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Seedly's Product Comparison Page Listing Guidelines
For P2P Lending products to be listed on Seedly's Product Comparison Page, they have to fulfil the following criteria:
Peer-to-peer (P2P) lending enables individuals or small companies to obtain loans directly from other individuals.
It's an alternative method of financing which cuts out the middleman (eg. financial institutions like banks) and allows very young companies or SMEs with a brief credit history to crowdfund and raise money.
A P2P lending platform allows such activities to be carried en masse and allows such individuals or companies to avoid wasting time, spending unnecessarily on financial costs, and overcome the limitations imposed by traditional financial institutions when it comes to seeking funding. These platforms connect borrowers directly to investors and enable such transactions.
If you're an individual investor who is seeking better returns on your cash savings as compared to what a high-interest savings account can give, you can become a P2P lender and potentially get better returns!
Naturally, these P2P loans carry an inherent risk too. Since these individuals or companies lack a strong financial record, you'll notice that P2P lending platforms will post a wide range of interest rates based on the creditworthiness of the applicant. Most importantly, as an investor, you'll also want to take note of the defaults rates to make sure that you don't lose your capital (as much as possible, of course... P2P investing is a high-risk investment!).
Currently, these are the few major P2P lending platforms in Singapore:
To help you make a smarter investment decision when it comes to picking the best P2P lending platform, you can always check out the reviews left by real users on SeedlyReviews to find out more about what the user experience is like with the platform, what is the quantity and quality of deals you have access to, how transparent is the portfolio, and how helpful is their customer support!
These are valuable insights which aren't usually published by the companies or P2P lending platforms but usually gleaned when investors use these platforms firsthand.
If you need more information like what are the fees involved and what are the default rates like for loans taken out via the P2P lending platform, you can always check out our comprehensive comparison of the various P2P lending platforms in Singapore!
Got more questions about P2P lending and what are the risks and rewards involved?
You can always ask the Seedly community!
Contact us at [email protected] should you require any assistance or spot any inaccuracies.
The difference between peer-to-peer and crowdfunding is that peer-to-peer earns from the payable interest on the loan provided to a business whilst crowdfunding typically offers equities in return for funding.
In order to start investing with p2p lending, you will first need to register with your selected p2p lending platform and create an investor account. There might be settings you need to set such as interest rates you would prefer to incur on the funds you are borrowing out to. Once you're done with registration, then all you have to do is browse and pick the loans that you want to invest in.
Yes, P2P Lending is legal in Singapore. While there are no regulations that specifically apply to P2P lending in Singapore, this form on investments are being regulated under the Securities and Futures Act (SFA) and the Financial Advisers Act (FAA) both of which involves licensing requirements.
P2P Lending are generally considered a form of investments that can potentially generate high yields from 7% to up to 16%.
One of the purpose that P2P lending serves to individuals is to allow them to invest into a market where business are looking to acquire funds from individuals as an alternative to using financial institutions as a source of securing funds.
P2P Lending platforms generally work by connecting business that are looking to secure funds to investors looking to invest and earn interests out of the loans they give out. This is done either by programmatic matching or by browsing on the platform for potential businesses with requirements that best suits your offering.
As with all investments, there are risks attached to it. One of the biggest risks with P2P lending is the risk of default. So due diligience is required by the investor before participating in P2P Lending.