Is it advisable to invest in P2P lending with little experience in investment?

Hi,

Personally, I will avoid investing in P2P lending. I think the risk is high because there is no formalised credit rating and the interest rate is higher when it is at the P2P side as compared to the banks rate. For the company to use P2P means there is a high chance that bank reject their application for loan. Hence, you may be under compensated for the risk that you are taking because you don;t know what is the rate spread that the P2P take as commission.

Hello!

Before deciding whether to invest in P2P or any other investment areas it is essential that you know what exactly a certain investment is to decide whether or not you are comfortable with it.

P2P lending maybe a good form of investment for beginners since it does not require much capital since the minimum investment can go to as low as $100 or maybe even lower for some platforms.

P2P can also serve as a form of diversification for your portfolio as you start to invest in other platforms in the long run.

It also has attractive monthly returns of 10% or more. You will also be able to get monthly returns.

However, P2P investment carries a rather high risk since the loans are for SMEs, you may end up losing all your investment should the company default on the payment.

Ultimately it will still depend on the type of investor you are or plan to be. If you are willing to take risks as a beginner, P2P investments maybe a good form of investment.

Hope this helps!