P2P lending is part of the rapidly evolving economic model of the sharing economy. This type of lending allows people to step into the shoes of a bank and lend to other people through online platforms. The principle of operation is as follows: a potential borrower applies for a loan, the platform assesses his creditworthiness and gives him a score, then lists the loan request along with information about the borrower on the platform and enables investors registered on the platform to finance the loan. The platform mediates between investors and borrowers and takes care of protecting the rights of both parties. In addition to direct funding from platform investors, loans can also be funded by non-bank financial institutions, called originators, which can then be sold to investors on p2p platforms of this type. In the latter case, the platforms serve only as an intermediary between the investors and the originators.
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We believe in the future of the financial industry and beyond.
We at Cashlend believe that a person should be able to freely manage their money, which is why we created Cashlend.
The crisis of 2008 made banks much more conservative in granting loans to businesses and individuals, which created opportunities for the emergence of numerous peer-to-peer (P2P) lending platforms that offer an alternative way of investing and providing financing for both businesses and individuals.
This revolutionary service, part of the rapidly growing sharing economy, allows ordinary people to earn a high return by lending money to others who have the opportunity to borrow under favorable conditions. One of the reasons consumers use P2P lending is that, compared to traditional bank loans, where applicants must provide multiple documents and wait for approval for several days, P2P lending offers an easier and quicker way to obtain credit, and in some cases, it can even be a more cost-effective option compared to traditional bank loans.
Another reason for using P2P lending is the possibility of consolidating multiple obligations to different institutions, where the borrower covers all obligations with a P2P loan, resulting in a reduction in interest rates and the total amount of monthly payments.
Yet another reason is that most platforms offer a fixed interest rate for the entire term of the loan, whereas not all bank loans have a fixed interest rate, and a variable interest rate can lead to increased loan payments in the event of an unfavorable economic situation.
The flexibility of operation offered by P2P platforms makes them increasingly preferred partners for consumers, and their popularity has grown significantly in recent years.