Thursday, 4 February 2016

Route to Alternative Financing

A lot has been written about Peer to Peer lending (P2P lending) and some of the users have taken the benefits of this unique and growing concept.

One might think what is in for me? Can this really benefit me?

The answer is YES. Consider the following, these are some of the points that are adopted by almost all P2P lending sites or platforms:

  1. No minimum salary or income requirement
  2. CIBIL Score (above a certain level) not mandatory – considering all P2P lending platforms have their own unique way of credit checking
  3. No minimum continuation of the job or businesses continuity or vintage criterion
  4. No collateral
  5. Speed processing
  6. Relatively lower interest rates
  7. Online and hence 100% transparent

Honestly, the list can go on…

Not to say that P2P lending platforms do not do credit checks; almost 60% of applications received by a P2P platform can get rejected too. However, the reasons for rejection would not be based on salary or balance sheet size. As mentioned above every platform has its own unique way of credit assessment.

Some of the studies for India have said, that approximately 70% of Indian population is still unbanked because of the ‘stringent’ eligibility criterion formulated for obtaining loans from the financial institutions.

Considering above the borrowers should be happy to deal with the P2P platforms and start obtaining loans for whatever needs they have from education to business… through this route of Alternative Financing.

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