Peer to Peer Lending

Which are the Best P2P Lending Platforms in India?

The best P2P (i.e., Peer-to-Peer) lending platforms are consistently transforming the financial landscape in India. It is a valid alternative offering considerable loan options that bridge the gap between borrowers and investors. However, there exist numerous P2P lending platforms in India allowing investors to interact without the need for intermediaries such as banks and NBFCs.

Dive into the list of the best P2P lending platforms offering hassle-free and cheap interest rates for your investments.

Understanding P2P Platforms in India

The P2P platform in India is an innovative lending model which offers a win-win situation for both parties. The method ensures eliminating the dependency on the conventional financial institution. It is simply an effective choice for processing credits and finances without resorting to exploitative payday lenders.

The process for lending through P2P platforms in India is considered a feasible option contrary to applying through a bank. These platforms establish a direct connection for loan approvals and higher returns in comparison to other investments.

Why Entrepreneurs Choose P2P Platforms?

P2P lending, which is a source of financing, holds the potential to extend financial inclusion globally. Although P2P loans, primarily consisting of personal loans, offer borrowers another compelling reason to apply for P2P license, such as:

• Offer better interest rates
• Quick approval and disbursal
• Transparent process of borrowing
• Better eligibility than traditional banks
• Diverse borrowing options
• Flexible repayment terms

How Do the Best P2P Lending Platforms Work?

The working pattern of the best P2P lending platforms allows investors to earn interest on loan payments. Here’s a step-by-step guide explaining the working pattern of P2P lending platforms in India:

1. Register on P2P Lending Platform

The borrower seeking loans is required to initially visit and register an application available on the concerned P2P lending platform.

2. Evaluation of Application

The P2P lending platform is further required to conduct an evaluation and assess the risks associated with the borrower’s application.

3. Interest Rate

The P2P platforms are further authorized to assign an appropriate interest rate based on the creditworthiness of the borrower.

4. Review of Available Options

The borrowers seeking loans are authorized to review and make a choice among the available options for receiving the loan amount from the selected investor(s).

5. Credit of Loan Amount

The chosen investor(s) further credits the loan amount in exchange for responsible periodic interest payments on the principal amount at the time of loan maturity.

6. Charge of Fees

The P2P platforms facilitating the lending of funds also charge a nominal fee from both the borrowers and investors.

7. Payment of Taxes

The investors charging interest income from peer-to-peer lending are taxed under head Income from other Sources, similar to interest earned from other instruments such as FDs.

Future Prospects of P2P Lending Platforms

The Indian fintech industry is observing rapid growth, particularly in the P2P lending sector. Though P2P lending started in 2012, it quickly held its position in the fintech lending regulated by the Reserve Bank of India. Despite being a young industry, the P2P lending market in India is projecting a growth of around USD 10.5 billion by 2026, with an impressive annual growth rate of 21.6% since 2021.

India’s Top 10 P2P Lending Platforms for 2024 & 2025

After having a solid grasp of the working pattern of the best P2P lending platforms, have a look over the list of India’s top 10 P2P lending platforms for the year 2024 as enlisted below:

1. LenDenClub

LenDenClub, founded in 2014 is India’s leading P2P lending platform known for its quick loan disbursals. The platform which has around 2 crore registered users disburses more than 15,000 loan applications. It is an NBFC (Non- Banking Financial Institution)- Peer to Peer which offers a wide range of loan products including business, education, and personal loans.

The platform mainly allows retails and institutional lenders to fund personal loan to individual borrowers with an interest rate up to 15% per annum. The platform further allows zero withdrawal fees with funds. However, a platform fees including a facilitation fee of 0% to 4% of loan amount is historically charged through lenders.

2. Lendbox

Lendbox, established in 2015 is another best P2P lending platform which allows borrowers and investors to transact on short to medium term personal unsecured loans. Lendbox which is an RBI-licensed platform ensures managing all client loans and repayment in a single place. Simply, they provide a credit line product with numerous repayment options.

The investors at Lendbox require a minimum investment of Rs. 25,000 to generate up to 15.4% annual return on investment (ROI). The tenure of credits, which ranges from 6 to 36 months, ensures securing the ordinary investors’ access & fractionalization of debt instruments. Lendbox strongly enabled retail investors to create and form collaborations with various wealth management firms adopting a smooth API-integrated model.

3. Faircent

Faircent, started in 2013 is the India’s first platform which received an NBFC-P2P license from the RBI. The platform is established with the intent to ease liquidity-released stress on borrower-stricken by the pandemic. The online leading initiative further offers business, personal, and property loans.

Faircent, a tech-enabled platform is designed as a marketplace which connects individual borrowers with institutes offering credit/ funds. This platform which has a remarkable track-record of over 99% on-time loan repayments is simply considered a great option for earning flat returns on investments while helping increase portfolio stability.

4. Mobikwik Xtra

Mobikwik Xtra is another of the best P2P lending platforms which provides short-term loans with an emphasis on speedy approval. It is a financial service offered by Mobikwik, which is an application for digital wallets and online payments. Thus, the platform provides its P2P lending services linked with the Mobikwik Xtra mobile application.

Mobikwik Xtra P2P platform which is based on investment product allows users to earn daily interest of 12% per annum on their investment. However, the platform offers higher interest rates in comparison to saving bank and fixed deposits.

5. CRED Mint

CRED Mint which is one of the best P2P lending platforms is an extension of the popular payment application, CRED. It is an exclusive instrument designed to directly connect borrowers with the lenders. The platform which provides selected lending alternatives at competitive rate of interest (ROI) ensures checking the value of daily investments made on the CRED application.

CRED Mint in partnership with Liquiloans offers a flexible platform for withdrawal of money. The CRED members are required to make an investment or lend up to a value ranging from Rs. 1 to 10 lakhs with an annual return of up to 9%, which is significantly higher than traditional bank fixed deposits.

6. IndiaP2P

India P2P is yet another best P2P lending platform which assists borrowers to connect with individual lenders. The platform which is considered an alternative source of finance provides advanced security measures for safe and secure transactions. It further offers a variety of lending options including individual and medical loans.

India P2P lending platform is designed to provide great level of control allowing investors to select certain debtors for investment. The minimum investment of Rs. 5000 allows investors to attract a return of up to 18% annually. Furthermore, the platform prioritizes ethical practices, transparency and community values alongside financial gain.

7. Finzy

Finzy created back in 2016 holds a mission to enable risk- optimized investing is among the India’s 10 best P2P lending platforms. It offers various opportunities for investors to earn anywhere between 7.99 to 27.99% return based on their risk appetite. Finzy which is a convenient and attractive platform offers flexible repayment option.

Unlike other platforms, Finzy allows individuals to decide their investment period, risks, and amount for credit. The trending platform also employs a rigorous process for credit assessment and system for risk-based pricing of the borrowers. Simply, the application serves the employed and salaried people having the ability for quick repayment of debts through automated earning withdrawals.

8. Fello

Fello is among India’s 10 best P2P lending platforms designed for team collaboration and project tracking. The platform facilitates immediate communication among parties, resulting in increased transparency. The platform further integrates popular tools like Slack and Google Drive centralizing the project pieces of information.

Fello, as an intuitive interface helps visualizing workflows and tracking task deadlines for smooth communication between the team members. The platform which allows for potential returns of up to 15.5% requires a minimum investment of just Rs. 100.

9. iLend

iLend is another best P2P lending platform which is mainly concerned with lending of micro, small, and medium-sized businesses. It aims at revolutionizing the India’s credit market by providing a unique borrowing model which allows investors and borrowers to decide upon the terms of the loan.

iLend provide loan to individuals at an interest rate starting from 15% per annum on amount ranging from Rs. 25000 to Rs. 5 lakhs. Furthermore, the flexible tenure for loans provided through iLend ranges from 6 to 36 months.

10. i2i Funding

i2i Funding, established in 2015 is among the best P2P online lending platforms which differentiates itself by focussing on agricultural functioning. It serves as a bridge which connects individuals looking for unsecured personal loans with investors seeking attractive returns. Simply, i2i funding matches lenders with farmers who require loans for various agricultural purposes.

The i2i funding platform yield high potential returns of up to 36% annually, on the investments starting at Rs. 1000. The platform further provides a free recovery service which minimizes the loss in case of any default. However, the platform employs robust credit risk assessment tools and other user-friendly interface for securing lending in India. 

To Wrap Up

The P2P lending platforms have emerged as a game-changer in the Indian fintech landscape. India’s best P2P lending platforms are considered alternatives to traditional banking channels for both investors and borrowers. These platforms leverage cutting-edge technology and robust risk assessment techniques, which facilitate a seamless and transparent lending system in India. Additionally, a strong knowledge and understanding of the difference between P2P lending and traditional financial institutions might assist investors in making informed decisions.

Looking to explore the best P2P lending platforms in India for 2024? Visit our official website at https://enterslice.com/ to discover top platforms, compare options, and learn how P2P lending can enhance your investment strategy!

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