Peer-to-Peer Lending (P2P) is a Reserve Bank of India approved lending and borrowing platform.
Individuals and Non-Individuals like companies, HUF, can participate in P2P Lending platform.
We at Vridhi Investment can help you in account opening and participate on the P2P platforms.
The banks borrow money from the investors commonly known Fixed Deposits and pay them a yearly return in the form of interest rates. The banks lend this money to those in need of personal and business purposes. The money is lent to the borrowers, and the banks charge an interest rate higher than the fixed deposit rates.
illustration: Mr.X takes his money, say Rs.1 Lakh, goes to a bank and starts a fixed deposit @ 7% p.a. Another person Mr Z requires capital for expanding his business. He borrows Rs. 1 Lakh from the bank as a Business Loan at a rate of 15% p.a. The difference between the bank’s borrowing rate and the lending rate, i.e. 15% minus 7% = 8% is the bank’s profit.
Under the p2p lending system, an individual can borrow money directly from other individuals by registering on a peer-to-peer lending website.
Thus, you skip the services of institutions like the banks, increasing the possibilities of generating higher returns on your investment.
Different types of Loans which your money is lent as.
All financial institutions raise money in the form of fixed deposits, bonds, debentures, etc. If you notice the rate of returns on these instruments, they are always almost similar, meaning not much difference. FD’s may give you 6%, Debentures 8% and the Bonds 7% with small variations. This money raised at an average rate of 6% to 7% interest rate is lent in different forms and at different rates, a few examples are:
- Housing Loans: 8% to 9%
- Vehicle Loans: 10%
- Business Loans: 12% to 15%
- Personal Loans: 15% to 18%
- Credit Card Loans: 36% and above
Your money is lent at average of 12% to 15% while you make not more than 6% to 7% *(All rate estimates as on Oct’2020)
P2P or the Peer-to-Peer platforms allows you to lend the money directly to the above borrowers, and you enjoy the benefits of higher returns that that of a fixed deposit or a bond.
The Peer-to-Peer Lending System
How to proceed?
- Open an account with a P2P lending platform at Vridhi Investment.
- Transfer money to the escrow account.
- Start choosing the borrowers and start lending.
- Receive a better return on your money than a fixed deposit.
- Reinvest or choose to withdraw the money as and when received.
Rs.50 lakhs is the maximum amount allowed per PAN number and there is no minimum entry amount. *As on Oct’202
Vridhi Investment has tie-ups with peer-to-peer lending platforms, you can choose them if you wish to.
Vridhi Investment will support you as an intermediary based on your expectations and will provide timely information.
The peer-to-peer lending is yet another option which you, as an investor, can choose to park some money as per your risk-taking ability, goals and expectations. This lending system provides another option to diversify your portfolio by becoming a lender directly. The awareness is yet to take off; hence this also is the right time to start and get better yields. As the awareness increases and the market gets crowded, the yields will surely come down. You have a chance to reap the benefits for a few years to come.
Once you decide to open an account and invest, we will help you understand the interface and learn how to lend to various profiles as per your profile. The system is quite simple and easy to understand. We hope you have an exciting experience with Vridhi Investment and can call us anytime for all support you may require. Do share this page with your friends and relatives and introduce them to the system.
Keep Photos of PAN Card, Cheque Leaf and Address Proof in the system. You will have to upload them while opening the account. After opening the account WhatsApp the Application Number to the above number for us to track the activation.