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Lending on P2P platforms is risky

Possibility of 16-22% annual returns is attractive but analysts suggest caution till norms are put in place

Tinesh Bhasin  |  Mumbai 

Becoming a lender at a peer-to-peer (P2P) lending platform could appear attractive. You lend to an individual whose credit profile has been evaluated by the P2P platform and start earning equated monthly instalments the next month. The returns can be as good as 16-22 per cent returns a year, more than double most annual fixed deposit rates. But, this investment comes with much higher risk. “They are meant for investors who understand  there is no guarantee that all loans will be repaid and can stomach losses if a borrower goes delinquent,” says Lovaii Navlakhi, founder ...

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First Published: Thu, October 13 2016. 22:40 IST
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