{"id":18063,"date":"2020-10-17T12:15:52","date_gmt":"2020-10-17T06:45:52","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=18063"},"modified":"2020-10-17T12:15:53","modified_gmt":"2020-10-17T06:45:53","slug":"borrowing-money-from-p2p-lenders","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/borrowing-money-from-p2p-lenders\/","title":{"rendered":"Thing you Must Know before Borrowing Money from P2P Lenders"},"content":{"rendered":"\n

In the P2P platforms, individuals both borrow as well as lend from each other. Typically, borrowers who are incapable to obtain funding from a financial institute mostly due to inadequate credit score opts for these platforms. When in need of some credit, be it due to some urgency or to buy the car that you were hoping to purchase in the past, there are different ways to avail a credit; one of them is P2P lenders. These digitally-driven platforms have emerged as a reliable financing option for those having issues in availing of unsecured loans through conventional means. Their rate of interest is also nominal. <\/p>\n\n\n\n

Key Points you Must Remember to Raise Money through a Loan\nfrom Peer to Peer Lending Platform<\/h2>\n\n\n\n

If you wish to raise money through a loan from Peer to Peer lending platform, here are some key points you must remember<\/p>\n\n\n\n

\"Raise<\/figure><\/div>\n\n\n\n

Read our article<\/b>:NBFC-Peer to Peer Lending Platform \u2013 Compliance and Registration<\/a><\/mark><\/p>\n\n\n\n

Eligibility Criteria for Raising a Loan<\/h3>\n\n\n\n

Before applying for credit, the borrower\nmust satisfy the minimum eligibility criteria for raising a loan. Therefore, it\nbecomes essential for the person to get accustomed to the eligibility criteria\nof that platform. If you know what they offer and what their constraints are,\nit becomes easier for you to avail of a loan. If you eyeing on the higher limit\nof credit, find out the same as even though Reserve Bank has set a limit for a\nloan of Rs 10 lakhs to a single individual, there are various peer-to-peer\nlenders who have their own upper limit. <\/p>\n\n\n\n

Guidelines on Registration <\/h3>\n\n\n\n

These platforms are bound to follow the\nguidelines drafted by the Reserve bank. For example be it on the security\nfront, privacy, information, collection, etc. Therefore, you must look into the\nplatform and find out whether it has mandatory certificates and registration at\nthe disposal or not. These platforms also require intimate higher authorities\nlike CIBIL and Experian about the individual loan repayment details.<\/p>\n\n\n\n

With these individuals paying their monthly installments on time, they will able to score better CIBIL score, only if the peer to peer lender is Reserve Bank registered NBFC<\/strong><\/a> -P2P.<\/p>\n\n\n\n

Turn-Around-Time<\/h3>\n\n\n\n

If you are in a state of urgency to avail\nof financial help, scrutinize the lending platform regarding the disbursement\ntime. Typically, the platform offers a turn-around time, aka TAT for two to three\ndays which might differ if the platform lacks adequate lenders. According to\nexperts, if the credit amount is higher than ten lakhs then it is feasible that\none may not receive the credit amount even after waiting for two to three\nweeks. <\/p>\n\n\n\n

Additional fees for Loan<\/h3>\n\n\n\n

Firstly, determine whether the particular\nloan scheme comprises any additional fees. For example, many lenders charge\nprocessing + registration fees with the monthly installment amount which the\nborrower will have to bear. According to the experts, the borrower must act\nwisely in such a situation and should estimate the total expenditure to avail\nof a loan. <\/p>\n\n\n\n

Financial Credibility<\/h3>\n\n\n\n

Also, determine the financial credibility of the lender by looking into\nprevious charges or penalties. Even though most P2P lenders do not charge\npre-closure, it\u2019s better to determine if there are any. Therefore, go through\nthe loan agreement carefully and point out facts regarding charges, which you\nmight have to bear in case of repayment delay, change in the bank, check\nbounce, etc. <\/p>\n\n\n\n

Basics of P2P Lending<\/h3>\n\n\n\n

P2P lending site connects investors to\nborrowers. Rate, Terms & Conditions, and transaction mode could differ from\nplatform to platform. The majority of the websites have a wide bandwidth of\nrate of interest depending on the creditworthiness of the applicant. <\/p>\n\n\n\n

First, an investor opens the account on the\nP2P site and deposits some funds to be disbursed in loans. The applicant or the\nborrower posts a profile on the same site that is assigned a risk category that\nestimates the rate of interest the borrower will suppose to pay. The applicant,\nfurthermore, can review the offers and pick one. The transaction and repayment\nrelated matters are handled on the platform itself. Even though the platform is\nfully automated, it allows interested parties to haggle without any\nissues. <\/p>\n\n\n\n

Key Takeaways <\/h2>\n\n\n\n