Is It Better To Lend Money To A Friend Or At P2P?

Lending always seems to be a riskier proposition which can only be justified on the grounds of good return in the form of interests over it. If you have a surplus of funds, it is judicial to invest in some profitable avenues so that you can earn some considerable yields over it. It is highly appreciated if you employ them in helping out a friend if he is in need of the same. But chances are fair to experience ‘bad’ consequences as losing your money as well as friend in case of default as finances have been a major reason for distances in relationships.

So, if you have a fair chance to politely turn down such a request and direct them to platforms like, it will not only shrink the possibility of such ‘bad’ experiences but also assure them that you are inclined to help them out. And you can also employ your funds by becoming an Investor and ensure that your investments are in a safer hands with good yields.

But how this mechanism works out is yet to be explored! I2I funding is basically based on the concept of Peer 2 Peer (P2P) lending where lenders get connected to the borrowers eliminating the traditional brick-mortar institutions. This is an online platform where you can fetch number of people sourcing your requirements in real time. Not to mention, the process here is hassle free and quick.

As borrowers are judged over 50+ parameters being CIBIL score just one of them, chances of rejection for loan application of borrowers  in case of low CIBIL score is quiet low. But does that mean your investment is not in the safer hands?

Absolutely not! As the platform like I2I funding has less than 4% default rate till date by its borrowers. A stringent background check is followed before approving any loan application. A contingency reserve is also maintained known as Principle protection fund to ensure that if any borrower commits a default, the investor shall not forgo with his/her principle amount. Principle protection ranging from 25% to 100% is offered to the investor depending upon their risk appetite.

Depending upon the credit-profile of every borrower, they are assigned to a risk category as A to F. While Category A ensures lowest risk from good credibility of borrower, Category F represents the highest risk. The rate of interest is directly proportional to the risk involves i.e. Greater the risk, greater the returns. So, every lender has a fair chance to earn interest depending upon his/her risk-appetite.

P2P lending is a surely a trusted ‘wave’ of investment solutions which must be explored by every investor so far!

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