What is P2P Lending | How to Apply for Peer to Peer Lending License | Benefits | Process – Corpbiz
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#PeertoPeerLendingLicense #P2PLending #Corpbiz
Peer to Peer Lending License?
Peer to peer is a type of #NBFC. Under this model, one can apply for a loan from individuals instead of applying for a loan from banks or financial institution.Peer to Peer lending #companies are regulated by the #ReserveBankofIndia. Peer to peer lending model is proving profitable for lenders as well as borrowers in such a way that lenders can earn higher rate of interest while borrowers can borrow at lower rate of interest.
How does Peer to Peer Lending platform works?
On #peer_to_peerlending platform, loans are taken by the borrowers from the individual investors (lenders) who are willing to lend their money to the borrowers on an agreed rate of interest.
On #P2P lending platform, the profiles of the borrowers are displayed, from where lenders can freely choose the borrowers’ profile and take decision of lending money. It is not necessary to have any relationship between lender and buyer.
It is not necessary that proposed borrower receive full loan amount, he may get certain amount of what he asked for from an investor. For the remaining amount, the loan may be given by one or more investors on the #P2Plending platform.
Characteristics of Peer-to-Peer Lending
• P2P Lending platform involves online transactions
• Prior relationship between lenders and borrowers is not necessary
• On P2P platform, lenders can freely choose borrowers to invest in
• No direct intermediary negotiating interest rates or amounts
Eligibility Criteria for Obtaining Peer to Peer Lending License
Company must be registered in India
1. It is essential for applicant to have technological, entrepreneurial and managerial resources
2. a candidate must have satisfactory capital structure;
3. Proposed Directors must satisfy the fit and legitimate models
4. There must be a legitimate arrangement for proficient Information Technology System
5. A feasible #Business Plan
6. Thought process to serve in public interest
Benefits of Peer to Peer Lending Platform?
For Borrowers
1. The borrowers can avail the benefits of low interest rates as compared to banks and credit cards. In some cases reduction of about 35% has been witnessed.
2. This type of platform provides the leverage of fixed rate of interest even in the case of late payments, thereby, it acts as a lucrative option in the hands of the borrower.
3. The customers are provided with exclusive digital experience of facilitating rapid flow of transactions.
4. The platform charges lower fees as compared to other modes of finances. Moreover, no penalty is attracted to pre-payment
For Lenders
1. Generally, the returns offered to the investors are higher, depending upon the type of risk you undertake.
2. For investors, there is a wide variety of options available to put their capital into.
3. The platform provides the lenders an option to directly communicate with borrowers and finalizes their deal with the borrowers.
Types of Peer to Peer Lending Model?
Consumer Lending
Small personal loan like for cars / family or self-weddings / holidays / home repairs / repayment of credit card dues.
Small Business (SME) Lending
SME loans are provided to small business for the following purposes:
1. Working capital
2. Business expansion
3. Asset finance
Generally, founders offer a personal guarantee against the loan.
Property Lending
This is secured P2P lending against the 1st charge of the commercial or residential property. The loan is borrowed for personal mortgages, Buy-to-lets, Residential refurbishment, and developing commercial loans. This model is not popular in #India.
Procedure of Obtaining Peer to Peer Lending License
• Any business unit whether Private Firm or Public Firm is eligible to commence the business of P2P lending, to begin they need to apply to RBI for the P2P license. For this, they need to fulfil the following:
• Organization ought to be registered in India as #PrivateLimitedCompany or Public Limited Company with the principal motive of financing;
• Least net possessed assets of INR 2 crores.
• WebSite/Mobile App Work Flow
• The online application is accessible on #RBI’s site (COSMOS).
• Accommodation of printed copy of the application alongside joined documents will be submitted to RBI Office.
• The permit will be allowed simply after watchful review of the application and documents connected with it.
Read more – https://corpbiz.io/peer-to-peer-lending-license
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Email:- info@corpbiz.io
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How to Do p2p Lending, What is P2P Lending | How to Apply for Peer to Peer Lending License | Benefits | Process – Corpbiz.
A Good Look At Prosper Loan And What It’s All About
Bonds can also be safe investments if you get a strong company. You just get to share the assets with the rest of the bond holders. Although whenever the economy suffers, these commodities do extremely well.
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Start A Small Business Now?
In these cases, your monthly allotment will not be enough. As great as that may sound, this option should be carefully scrutinized before making a decision to apply for a loan. Let’s say you need to borrow $400 today to get your car fixed.
Investment planning is important from the point of view of your future. The planning cannot be done in just one day and you will have to take smaller steps towards attaining investments that work well for you. Here is some information about how to plan for your investments.
Go with INTERMEDIATE-TERM bond funds to lower your interest rate risk (losses due to interest rates going up). Go with high to medium quality CORPORATE BOND FUNDS vs. government bond funds to boost your interest income without greatly increasing your risk. To get the best Peer-to-peer lending investment look for no-load funds (no sales charges) with expense ratios of less than.25%. Why pay 3% or 4% in sales charges and over 1% a year in expenses to earn 2% to 3% in interest income with the possibility of losing money if interest rates go up in 2012 or in the years that follow?
In today’s real estate market, many LTV’s are between 50 – 60%. This means that real estate values would have to drop by half before your principal investment would be at risk. At no time in history has this ever happened, so for the most part, this is considered a very acceptable risk. On top of this, there is a second layer, or level of protection for investors. It’s called the Buyout Agreement. This is a contract whereby you are guaranteed to get your money back if the borrower defaults for any reason on your note. Keep in mind that this second layer of protection is not offered by most trust deeds, so you must ask for it.
One of the most popular ways of getting low-interest rates loans using the Internet is Peer-to-peer lending. These are lending networks of many individual lenders (investors) who give out small loans to people that need it. When you borrow money or an unsecured loan from a bank and you default, the bank losses a lot of money.
Investments for beginners can be tricky. You may be weary of the risks involved yet you must be comfortable with the fact that with some Investments, loss is a risk. There are some low risk and risk free investments that can be made. You should learn in the beginning what your options are.
Whatever the situation may be, this is a viable solution to your problems. Here, you never have to wait for your monthly settlement payments again. Here, you get to have most of the money that is due to you immediately. However, how does this process work?
If you have money saved in a 401k plan with your employer, you can usually borrow up to 50% of the value of your account. You pay interest on the loan, but the interest goes back into your account. Be aware that you have an opportunity cost with this option. The money you borrow is not able to grow as an investment until you repay the loan. Also be aware that you will have to pay back the loan in full shortly after you leave the company. Consult your tax professional to understand the tax ramifications that this may cause in retirement. Your interest is usually considered pre-tax money and will be taxed upon retirement, even though you paid it with after-tax dollars.
Mutual fund investments are designed for every-day people. What really happens if you take a debt consolation loan is something more than you bargained for. We just need to compare specific key points between coins and bonds.
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