Anonymous
What other investments should i be considering instead of P2P during this period?
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Alex Chua
26 Feb 2020
Seedly student Ambassador 2020/21 at Seedly
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Not necessarily. You need to compare the interest rates and lending period as well as the terms and conditions before you can ascertain if the loan from P2P is worthwhile.
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The answer is subjective.
P2p lending has their metrics to understand their ability to pay off their loans
The general rule of thumb is their cash flow.
As long as the profit generated is more than the debt, I don't see the reason to not pay off loans.
However as you mentioned, an economical downturn will reduce economic activity, reduce disposable income and profit. You will expect a longer loan frame, possible defaults and unpredictable repayment
This is subjective to their market and business models
On the other end, u could see a higher supply of loans as banks have lesser tendency to issue loans during recession. The interest may be higher
In general, the level of risk is set according to your comfort and experience level. I feel that as long as the borrower and the platform are responsible, the repayment will still be back to you