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Here’s The Best Way To Start Adding P2P Lending To Your Investment Portfolio Before The (Chinese) New Year

We’re in the time of the year when new year’s resolutions have just been set, and plans for the year ahead are in the midst of being  acted upon.

Now is also an opportune time to gain knowledge and add useful skills to your repertoire.

To help you with this, Funding Societies, Southeast Asia’s biggest peer-to-peer financing platform, is hosting a content-packed event to introduce you to the world of opportunities in peer-to-peer financing, and how you Funding Societies can help you find and make investments.

As you know, Funding Societies is licensed in Singapore by the Monetary Authority of Singapore (MAS) and has facilitated more than $365 million in peer-to-peer loans across the region.

Here’s what you can learn:

– Learn about how P2P Lending works for investors
– Understand the risks & returns of this investment type
– Hear first-hand from an SME owner about how your investments benefit SMEs in Singapore
– Sharing by Ming Feng from Seedly on how you can gain personal finance knowledge with the power of community

Date: 24 January 2019
Time: 6.30pm – 9pm
Venue: Lowercase Cafe @ 1 McNally Street (Walking distance from Rochor MRT)

You’ll also receive an exclusive goodie bag AND promotions for you when you attend the event.

Event Information And Registration

There really isn’t a better way to start the year and open the doors of opportunity in 2019. See you there!

If you have any questions relating to this and other events, please email Funding Societies at [email protected]

Complete Beginners’ Guide To Investing In P2P

By now, you’ve probably heard about P2P lending as a fast-growing alternative investment.

P2P lending allows investors to earn attractive interest on their money by lending it to businesses with growth potential and plans.  Returns come in the form of regular repayment of interest and principal. For any given loan, there could be hundreds of investors who put up the money and share the risks and returns of the investment.

There are some misconceptions about P2P lending, which you should be aware of so that you can make your own informed decision whether to invest in it or not.

Read Also: The Myths And Misconceptions About Peer-To-Peer Lending

The P2P Sector Has Grown And Matured

The alternative finance industry, or marketplace lending, has become increasingly popular regionally in recent times and has been growing at an impressive pace.

In 2016, Southeast Asia’s alternative finance market grew 363% from 2015 to a value of US$215.94 million, with marketplace business lending amounting to more than half of the market’s value. Further data showed that the market size of Singapore’s marketplace business lending grew almost 10x from US$9.43million in 2015 to $88.4million in 2016.

Funding Societies, one of the leading P2P platforms in Singapore and Southeast Asia recently surpassed $200 million in P2P loans successfully transacted through their platform, while maintaining industry-low default rates. The number of investors of P2P loans have also increased significantly – with 75,000 investors on Funding Societies’ platform alone.

Earlier this year, the Singapore Fintech Association formed the Marketplace Lending Committee, with the aim to represent all marketplace lenders, nurture and build relationships, design and promote good practices, and play a part in ensuring that the industry remains a reliable and viable source of alternative financing for business owners.

Why Invest In P2P Lending?

There are many good reasons why investors might want to consider investing in P2P, including flexibility, low investment amount, and transparency about the company you’re lending to, and their own skin in the game.

There are a few platforms that offer retail investors with P2P investing opportunities. One of them is Funding Societies, where users can enjoy loans with a short tenor, receive fast and frequent updates to their app and platform, as well as access loans with high potential returns.

Once you’re ready to take the plunge, head over to Funding Societies’ website to sign up for an account and take a look at the loans that are currently available for investing.

Read Also: 3 Good Reasons Why You Should Consider Investing In P2P

Sound Investing Principles Still Apply

Even though P2P lending is a new and nascent investment instrument, the fundamentals of investing still apply, such   as diversification, investing only what you can afford to lose, and knowing your own risk tolerance.

All investments carry risk, and you should be fully aware of what the risks are before investing your hard-earned money. The key risk being that of companies defaulting on their debt obligations.

Read Also: 8 Principles Of Investing For Beginners And Beyond

What Is Invoice Financing And How Can It Help Your Business?

In 2016, Funding Societies launched their second product, Invoice Financing. For those who are not familiar with the concept, here’s a quick introduction.

What is Invoice Financing?

Invoice financing is a product where business owners sell the future receivables or invoices they issued to their customers to get immediate cash.

Say there is a business owner and a buyer. Your customer purchased goods or services from you, the business owner, and was issued an invoice with a credit term of 60 days. This means the business owner will only receive payment after 60 days, at the earliest; but what if you need cash right away? This is where invoice financing comes in. Business owners can sell their invoices at a discount, in exchange for immediate cash, thus enhancing cash flow.

Utilised wisely, invoice financing can be a useful tool for business owners to fund business growth, even if their short-term assets are tied up in accounts receivable.

The process of getting upfront cash through invoice financing is significantly quicker than applying for a loan from a traditional financial institution, and unlike a business term loan, you are not taking on any additional debts. You are simply freeing up money owed to you, for the service you have already delivered to your clients.

Recently, Funding Societies announced the launch of Invoice Financing V2.0, an upgrade to their existing product, to provide SMEs with more flexibility and support in improving their cash flow.

With Invoice Financing V2.0, SMEs can expect:

  • Cash upfront for their invoices
  • Up to 80% of invoice value
  • No collateral required
  • Quantum up to SGD 1 million
  • Pro-rated interest on a daily basis

To help you better visualise the improvements they made, here’s a deep dive into Invoice Financing V2.0’s fresh new features:

1. Pro-rated interest on a daily basis

For regular invoice financing, interest rates are fixed to the invoice amount and loan tenor, and will not differ even if you or your clients repay early. Funding Societies’ Invoice Financing V2.0, on the other hand, pro-rates interest on a daily basis, providing SMEs with savings for early repayment. For example, if your clients were to repay a 100-day Invoice Financing in 90 days, only a 90-day interest will be charged, saving you a total of 10 days of interest!

2. Flexible Loan Tenors

For most Invoice Financing products, your loan tenor is fully dependent on your invoice terms, regardless of early or late repayments. In reality, however, companies often struggle with late invoice payments from debtors. With Invoice Financing V2.0, Funding Societies takes into account the client’s receivables aging history and offers up to 120 days tenor to provide SMEs greater flexibility and cash flow assurance through their invoices.


Funding Societies is dedicated to improving our products to better serve your financing needs. Invoice Financing V2.0 was crafted to help business owners like yourself have greater confidence in your business’ cash flow and provide SMEs with a quick turnaround option to fund operations and capture opportunities.

Funding Societies now takes into account invoices’ aging history for the approved loan tenor and also provides more flexibility for early repayment that would incur zero interest for the remaining invoice days.

Never miss out on another opportunity with Invoice Financing V2.0! For more information, you can live chat with Funding Societies today to find out more!

Largest Round Raised By P2P Lending Platform In South-East Asia

US$25 million – that’s the amount raised by Funding Societies in their latest round of Series B funding. With lead investor SoftBank Ventures Korea, other investors include Sequoia India, Alpha JWC Ventures (Indonesia) and Golden Gate Ventures.

Funding Societies (also known as Modalku in Indonesia) is a Peer to Peer (P2P) lending platform gives Small and Medium Enterprises (SMEs) access to capital by connecting them with retail investors. Earlier this year, Funding Societies surpassed the $100 million mark in crowdfunded SME loans, while maintaining a default rate of less than 1.5%.

Growth Of Alternative Funding Sources

P2P lending has been growing in popularity in Southeast Asia, due to the difficulty small businesses face in securing funding to grow their businesses and manage cashflow. According to a recent study by Ernst & Young, UOB and Dun & Bradstreet, 65.2% of the SMEs in Southeast Asia do not have easy access to business financing.

These small businesses cannot turn to traditional lenders like banks because they often lack collateral, have unproven track records, and need to pay prohibitively high interest rates.

P2P lenders like Funding Societies addresses this gap by providing fast and flexible funding for the growth of local SMEs, while allowing retail investors to participate in the growth story of Southeast Asian businesses. In fact, after just three  years of operation, Funding Societies  increased its lender base beyond 60,000.

Growing From Strength To Strength

Kelvin Teo, CEO and Co-founder of Funding Societies wrote in a blog post that the latest round of fundraising will help Funding Societies realise its vision of financial inclusion for the region. He shared, “It will enable us to help hundreds of thousands more underserved SMEs, while offering our lenders an even better user experience.”

The growth of P2P lending and the opportunities they provide for both companies and investors alike is an exciting prospect for the larger business eco-system.

This achievement of raising the largest amount of money for a P2P platform in Southeast Asia joins a long list of achievements for Funding Societies: Including being the first to introduce e-signing of contracts, implementing auto-investment algorithms for lenders and launching a mobile app for borrowers and lenders.

New To P2P Investing? Start Here.

You’ve probably heard about Peer-to-Peer (P2P) lending  as an alternative investment.

What Is P2P Lending?

P2P lending allows investors to earn attractive interest on their money by lending it to businesses with growth potential and plans.  Returns come in the form of regular repayment of interest and principal. For any given loan, there could be hundreds of investors who put up the money and share the risks and returns of the investment.

Peer-to-Peer lending is enjoying increasing interest and participation in Singapore for a few reasons.

#1 Higher Returns Than Traditional Investment Instruments

P2P loans could yield returns in the region of 10 to 14% per annum, which is very attractive, given the low interest rate environment.

#2 Short Investment Time Horizon

Compared to other investments than require you to hold an investment for years before seeing a substantial return on investment, yield from P2P investments can start to stream in months after the initial investment.

#3 Huge Capital Not Necessary To Invest

For as little as $100, you can begin to invest in P2P loans. This makes it ideal for young people who do not have alot of cash to spare and beginner investors.

#4 Relatively Simple Investment Mechanics

Investing in P2P loans do not require knowledge of technical analysis, performing stock valuations, or an advanced knowledge of finance. For each P2P investment, investors can examine a comprehensive factsheet that spells out vital information about the company and the terms of the loan. You can then decide for yourself if the returns promised is worth the risk will be taking on.

Interested To Learn More?

If you’re interested to learn more about P2P lending and how you can get started, Funding Societies is organising a seminar titled “What is Peer-to-Peer Lending?“.

Date: 24 January 2018
Venue: The Working Capitol (1 Keong Saik Road)
Time: 6.30pm – 8.30pm
(Registration: 6.30pm – 7pm)

Agenda:
– What is Peer-To-Peer Lending? – A global and local perspective
– How does investing in P2P lending work?
– Returns and risks in P2P lending
– How you can invest on Funding Societies’ platform
– Q&A session and networking

Drinks & light snacks will be provided.

You can head over to the event page for more details and register! The event is free of charge.

About Funding Societies

Founded in 2015, Funding Societies is an award-winning digital lending platform that enables SMEs to get unsecured loans and invoice financing, crowdfunded by individuals and institutional investors. It is licensed and operating in Singapore, Malaysia and Indonesia (as Modalku).

Backed by Sequoia Capital, it was the recipient of the MAS FinTech Award (SME category) and is also the only digital lender in Southeast Asia to be recognized as top FinTech 250 firms globally by CB Insights.

Success Story – P2P Loan To Manufacturer

This article first appeared Lets Crowd Smarter, a digital publication about crowdfunding and investing in Singapore and Asia.

Not all crowdfunding schemes are fraudulent. We (the Let’s Crowd Smarter Team) have invested in over 50 crowdfunding schemes across different platforms and our overall experience has been great.

Yes, there are a few problem loans whose repayments are always late. And we’re lucky not to have encountered any outright default yet. But we have seen more successes than failures.

We believe that as long as investors stick to the more established crowdfunding platforms (such as Funding Societies, MoolahSense, Capital-Match, Crowdo and New Union) and have a widely diversified portfolio, the overall returns should be positive.

As an example, our p2p loan portfolio is earning a cash return of about 1.5% per month, or about 12% so far this year.

Read Also: Spotting Red Flags in Crowdfunding Schemes

Crowdfunding Success – A Real Story

Here, we’ll share with you a crowdfunding success story – a p2p loan that we participated with Funding Societies in December last year. The effective interest rate was a cool 23.6% per annum. (We also have similar successes with other platforms and will share them next time.)

The loan ID is SB-1512005 but we’ll respect the borrower’s confidentiality and not disclose its identity. Below are some of the key features of the loan.

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To summarize, this company is borrowing $100k as working capital for a $780k project. It promised to repay over 6 months. Effective interest earned by the lender is 23.6% per annum. As this is a 6-month loan, the actual  interest earned is roughly half of that.

Funding Societies provided further financial information and comments on the borrower. We did a quick review and find the risk to be acceptable. Hence, we decided to lend $1,000 on this loan in December last year.

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Prompt Repayment

Over the next 6 months, this borrower repaid promptly every month. The final repayment was in June 2016. On this loan, we earned the 23.6% effective interest rate per annum – exactly as promised.

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Verifying Our Return On Investment

Now let’s verify that we are indeed earning 23.6% effective interest per annum.

But before we do that, we’ll need to explain the difference between effective and simple interest rates.

Effective interest rate refers to the interest earned on the outstanding loan. When the borrower repays its loan every month, the outstanding loan balance declines. The interest earned by this declining loan balance is known as the effective interest.

On the other hand, simple interest is basically the total interest earned by the loan as a percentage of the initial loan amount. It does not take into account the declining loan principal or the repayment every month.

We prefer to use effective interest rate. Using Excel’s IRR function as shown below, we easily show that the effective return is indeed 23.6% per annum.

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Is it really so easy?

If crowdfunding is so easy, why are there still plenty of negative news about defaults and frauds?

In our view, most of these platforms that ran into trouble are poorly managed. Many are fly-by-night operators that nobody has heard of. Their loan underwriting process is not credible at all. For the recent First Asia Alliance case, there were so many red flags, including the fact that the director of the crowdfunding platform is also the shareholder of the investee companies.

But there are also well-managed crowdfunding platforms that already have or in the process of getting CMS licenses from MAS. This includes Funding Societies, Capital Match, MoolahSense, New Union and Crowdo.

We (at Let’s Crowd Smarter) are comfortable with and have invested our own money with this second group of crowdfunding platforms. Overall, our investing experiences have been great. Of course, we do have some problem loans and late repayments, but these usually form less than 10% of our total portfolio. Success stories still far outnumber the failures we had.

If investors choose the correct platforms, investing into crowdfunding schemes can generate attractive returns without too much risk as shown in this example.

Read Also: Traits Of A Successful Trader

Funding Societies is a DollarsAndSense Brand Connect partner. Funding Societies is Singapore’s leading peer-to-peer (P2P) lending platform. They provide working capital loans for small and medium-sized enterprises (SMEs), along with attractive investment opportunities to the broader public. If you are interested to know them better, you can find out more on what they do on our DollarsAndSense Brand Connect Page.

How To Manage Your Investment Portfolio Like A Pro

Managing an investment portfolio is a lot like managing a business. With a disciplined, patient, and proactive approach, you can preserve and protect your wealth while attaining financial independence. Your investment strategies might differ, but you’ve to begin with some principles that are consistent at its core, which not only match the markets but your individual characteristics as well.

It’s also important to remember that not all investments in a portfolio may generate returns. It’s a lot like a badminton match – you will lose some points, but to win a game you’ll just have to win more points than you lose. Read the following keys to investing and know how you can ace those points!

Invest only in assets you understand

In many cases, retail investors take action in the fear of missing out on a “sure-shot” investment opportunity. The key is to avoid any frantic decision. Don’t worry about what you don’t know, worry about being sure on what you do know. If you don’t know how an investment actually works, you can’t know whether you really need it. There are plenty of alternative investment opportunities like P2P lending, which are easy to understand and implement. Consider investing in those.

Diversify

It is a prudent approach to create a basket of investments that provide broad exposure within asset classes. It spreads the risk and reward within your investment portfolio. When it comes to investing, the more diversified you are, the better.

We also advise diversification within an asset class or sector. For example, if you invest in P2P lending, you can distribute your investments across as many SMEs as possible to prevent loss in case an SME defaults. Even defaults hardly disturb your rate of return.

If you’re investing in stocks, make sure to not put more than 4% of your total portfolio in one individual stock. This will ensure that if a stock or two faces a downslide, your entire portfolio doesn’t suffer.

Invest for the long term

We believe that a long term horizon is a necessary ingredient for investment portfolio success. Investing is a marathon, not a sprint. Don’t get carried away with the ebb and flow of the market, and stay patiently invested. Also keep in mind that past performances are no guarantee of the future, and individual situations may vary.

Rebalance your portfolio regularly

Over time, your investments may fall out of sync with the original asset allocation. You may also want to restructure investment allocation. Re-assess your portfolio every six months or annually. Try not to tinker with your investment portfolio at short intervals of time – it’s also important to give time to investments.


This article was written by Funding Societies, Singapore’s leading peer-to-peer (P2P) lending platform. They provide working capital loans for small and medium-sized enterprises (SMEs), along with attractive investment opportunities to the broader public. 

Funding Societies is a DollarsAndSense Brand Connect partner. If you are interested to know them better, you can find out more on what they do on our DollarsAndSense Brand Connect Page.

5 Steps to Digitise Your Business in a Tech-Savvy World

Today’s technology grows at such breakneck speed. Compare the gadgets and online tools you are using today to ten, or even five, years ago. Technology is inseparable from daily life. Take online shopping. These days, many people prefer it to brick-and-mortar shops.

Business owners must adapt to the new digital age to stay afloat and thrive. Everyone needs to digitise their businesses. How to do so? Here are 5 steps:

Set a goal

Never build anything unless there is a set goal. Why do you want to digitize your business? What are your goals? Do you want to gain more sales? Do you want to create awareness for your business? Setting goals will help you decide which digital strategy you need to utilize.

Create your own sites

Invest your capital in creating your own business website. Make the address as simple as possible, preferably using your brand name as the web address. Prioritise design. Don’t hesitate to hire a web designer if you can’t do it yourself. Your company website is your business face. People will assess how professional your business is based on your site interface.

It doesn’t stop with design. You also need clear and useful content on your business website. Make sure that your content is related to your target market. You will gain more leads if you have high-quality content aimed to your target market.

Read Also: 5 Tips to Create & Manage the Best Business Website on a Budget

Use the power of social media

Now that you have your own website, you need to spread the word. This is where social media will help you in the most effective way. Create a Facebook page, an Instagram account, a Twitter account, even a LinkedIn page – utilise as many social media platforms as long as the platform is still within your niche and your company has the capability to maintain these accounts.

Invest in advertising. You can also broadcast your website’s high-quality content via social media accounts for branding.

Create a mailing list

Creating a mailing list will help you to keep in touch with customers. Hold promotions and discounts to attract more people into subscribing. You can also use referral campaigns to gain more subscribers from loyal customers.

Arrange your projects online

If possible, start digitising manual processes. By making your company more digital, you can cut down on inefficiencies and evaluate the overall workflow. Schedule periodic reviews to continue streamlining and evaluating your operations to keep your processes up to date.

Digitising your business is easier than you think. And the benefits are many. Adapting to digital technology will lessen the possibility of human errors and develop more efficient business processes. In the long run, digitising your business saves both time and money.

Read Also: Grow Your Business Without Breaking The Bank

This article was written by Funding Societies, Singapore’s leading peer-to-peer (P2P) lending platform. They provide working capital loans for small and medium-sized enterprises (SMEs), along with attractive investment opportunities to the broader public. 

Funding Societies is a DollarsAndSense Brand Connect partner. If you are interested to know them better, you can find out more on what they do on our DollarsAndSense Brand Connect Page.

Default Rates in Peer-to-Peer Lending Platforms

To paraphrase Crowdfund Insider’s “The Ultimate Crowdfunding Guide,” with peer-to-peer (P2P) lending, the risk an investor accepts is default. Every P2P lending platform has its own policy on default, and all investors need to take the time to understand these policies in order to protect themselves.

Because every P2P platform has its own default policy, and because the P2P lending business model is relatively young, we must be cautious when making generalizations about default rates across all platforms. Specific to Funding Societies, we fully aim to keep default rates close to banks – not exceeding 4 to 5% of loan amount to secure healthy returns for investors, even accounting for the cost of default.

The industry’s youth may cause investors with low-risk tolerance to view P2P lending as an unpredictable instrument. Generally, there is a consensus among investors that P2P lending constitutes a higher-risk, but higher-reward investment.

Is this belief true and valid? Let’s take a look at the global trend of default rates in P2P lending platforms.

Default Rates on P2P platforms in the USa

Let’s begin with default rates in USA platforms. In this fascinating article, the author analysed historical trends of default in two well-known USA platforms, then drew conclusions about the default rate of the P2P industry.

(Note that the article was published in 2014, so some might find it dated. However, the analysis within is worth a read)

The writer pointed out that from 2007 to 2008, the USA economy was doing very poorly and that both Lending Club and Prosper were operating under their earliest and most imperfect credit models, which means the default rates of 2007 and 2008 can be waved off. Since 2010, both platforms have averaged a 5% default rate and are likely to continue having solid repayment rates in the future.

The article ends with a positive conclusion about the P2P lending industry. The author wrote: “I see refined underwriting algorithms and mailed borrower marketing, encouraged investor capital and purpose-built technology all repositioning itself over and over for the past eight years until they are arrive at the stable place they hold today. I see analysis and sweat and reanalysis in these charts, and in the end I see it culminating into one of the most simple and creative investments our country has ever seen.”

His statement underscores that under the right circumstances, which includes an innovative team and rigorous credit policies, P2P lending platforms thrive and provide attractive returns while lowering default rates. The key is in selecting a trustworthy platform to invest in.

Read More: 5 Reasons To Invest in Peer-To-Peer Lending

DEFAULT RATES ON P2P PLATFORMS IN THE Uk

Moving on, let’s focus on a well-known and respected P2P lending platform from the UK: Funding Circle. In their statistics page, Funding Circle claims that its average annual default rate stands at 2%. The rate has also remained solid over the years (calculated from 2012-2017), showing that platform maturity and good credit underwriting will stabilise default rates.

funding societies’ DEFAULT RATES

What about our own platform, Funding Societies? Here is our own statistics page. Historically, our default rate across the region has lowered overtime, which reflects the analysis of P2P lending platforms in the USA: continuous platform improvement and rigorous credit policies will lower default rates.

Another worthwhile read about the risks in P2P lending is the study released by the UK Peer-to-Peer Finance Association (P2PFA). Some of the study’s pertinent points include:

  • The P2P industry has created more choice in the financing and investment market.
  • P2P lending platforms conduct credit risk assessment using the financial industry’s best practices.
  • P2P lending does not create systemic risk. Platforms are well-placed to weather a downturn in the credit cycle – defaults would need to increase at least threefold to reduce average interest rates for investors to below zero.

So let’s go back to the question we asked earlier: is P2P lending a higher-risk investment? Not necessarily.

However, the P2PFA study presented two caveats: that there is a good regulatory framework for the P2P industry and that investors are educated. For the first point, MAS has begun setting up regulations for P2P lending platforms. Funding Societies has always been compliant with regulations; we hold the CMS license required by MAS to operate, along with taking due diligence and our credit assessment process very seriously.

For the second point, there will always be risks in investing, including risk of default in P2P financing. But there are ways to mitigate such risks.

Read More: Investing In An Uncertain World

how can i diminish p2p investment risks?

How do you diminish P2P investment risks? You diversify your investment and reinvest your returns.

Diversification means distributing your funds across as many investment opportunities as possible to prevent loss in case of default. The more diversified you are, the more protected your investment. Even defaults hardly disturb your rate of return. If you choose not to diversify, you stand to lose most of your investments should a default occur.

Meanwhile, reinvestment refers to the act of funnelling your investment gains into new investment opportunities to maximise your returns. Without reinvestment, you only receive the expected rate of returns. But with reinvestment, you can maximise (sometimes doubling, even tripling) your returns while minimising your investment risks in case of default.

For more information on diversification and reinvestment, see here.

When investors fully understand the risks of P2P lending and take proper precautions to protect their funds, the advantages of investing in P2P lending clearly outweighs the risks. In fact, it’s very likely that most investors who keep diversifying and reinvesting their investment will continue to earn positive returns.


This is an updated version of an article posted on this blog. Click here for the original article.

This article was written by Funding Societies, Singapore’s leading peer-to-peer (P2P) lending platform. They provide working capital loans for small and medium-sized enterprises (SMEs), along with attractive investment opportunities to the broader public. 

Funding Societies is a DollarsAndSense Brand Connect partner. If you are interested to know them better, you can find out more on what they do on our DollarsAndSense Brand Connect Page.

Businesses That Should Consider P2P Loans

Peer-to-peer (P2P) lending is the practice of lending money to individuals or businesses through online platforms that match lenders and investors directly with borrowers. Anyone can take advantage of P2P loans, so long as they pass the required credit assessment.

P2P loans are particularly advantageous for small businesses and SMEs; applying for financing through a P2P lending platform offers a faster, simpler process – very useful for small businesses that need quick hits of working capital and cash flow aid. Whether or not you need a business loan depends on your financial condition, but if you are looking at financing options, P2P loans can be the loan product for you if you fit the categories below.

Businesses Looking to Grow

Looking to expand your business? P2P lending platforms can be the financing source for you. P2P lending platforms often target small businesses, with the appropriate revenue requirements and loan sizes to prove it.

Businesses Looking for More Working Capital and Cash Flow

A small business, no matter how profitable or healthy, needs constant cash flow. Because P2P lending platforms provide faster processing and approval notification time, businesses can get their funding faster than from a traditional financial institution. This is useful for certain businesses, as they need running cash flow more than others. Wholesalers, for instance, always need to buy more stock inventory.

Read More: 5 Useful Tips To Keep Your Business Finances Healthy

Younger, Smaller Businesses

Why is P2P lending an excellent option for young SMEs? Because even though they may be financially healthy and are generating good revenue, they usually have no suitable assets for secured loans. P2P loans generally have competitive rates and no collateral requirements, making it ideal for small businesses hungry to expand their companies (or maybe just need financing to fund a new project). P2P loans have a structure that is short-term with competitive rates.

Read More: When Should Your Business Apply For A Loan?