Peer-to-peer Lending Market Size, Share & Trends Analysis Report, By Type (Student Loans, Real Estate Loans, Consumer Credit Loans), By Business Model (Marketplace Lending), By End Use, By Region, And Segment Forecasts, 2023 To 2030

Peer-to-peer (P2P) lending is the practice of extending credit to other users of online marketplaces that bring together lenders and borrowers. P2P lending is frequently less expensive than traditional financial institutions and can provide larger returns for lenders. The majority of loans made through this lending process, also known as "crowd-lending", are unsecured personal loans, while secured loans backed by expensive assets like commercial real estate are also possible. P2P lending encompasses a number of loan forms, including factoring, payday loans, secured company loans, leasing, and student, commercial, and real estate loans. P2P platforms can reduce market losses brought on by loan defaults by setting aside some money.

Two key factors, reduced operating costs and lower market risks for lenders and borrowers, drive the worldwide peer-to-peer lending business. Because peer-to-peer lending platforms operate online and have lower overhead costs than traditional banks, they have lower operating costs. As a result, borrowers pay less in interest and lenders earn more money. Furthermore, peer-to-peer lending platforms reduce market risks by diversifying loans among numerous borrowers, which lessens the impact of any one borrower defaulting on the loan. The loan procedure is now more transparent thanks to digitization in the banking industry, which has also contributed to the expansion of the peer-to-peer lending market. According to the economic times, P2P lending has helped to empower SMEs in India, as many individuals don’t have good credit scores, they prefer to move towards P2P lending which comprises almost no paper works and lesser interest while not having a need to mortgage anything.

The growth of the peer-to-peer lending market is propelled by technological advances, such as the emergence of smart contracts using blockchain technology, which offer dependable and transparent borrowing and lending facilities. Furthermore, there is a growing preference among consumers for online loans due to the desire to avoid time-consuming lending processes and extensive documentation requirements, fueling the market’s growth. For instance, in 2018, Paytm launched its Paytm Postpaid where business individuals can borrow the amount from the app and can pay it back later and a specific limit will be approved.

North America is anticipated to keep holding sway over the worldwide peer-to-peer (P2P) lending sector. Due to the increasing acceptance and ubiquity of P2P lending platforms among investors and borrowers, the area is expected to keep holding the top spot. Additionally, it is anticipated that the region's demand for P2P lending platforms might be further fueled by the growing use of cutting-edge technologies like blockchain and machine learning.

Peer-to-peer Lending Market Segmentation

• By Type

  • Student Loans

  • Real Estate Loans

  • Consumer Credit Loans

  • Small Business Loans

• By Business Model

  • Marketplace Lending

  • Traditional Lending

• By End-use

  • Personal

  • Business

• By Region

  • North America

    • U.S.

    • Canada

  • Europe

    • UK

    • Germany

    • France

    • Italy

    • Spain

    • Denmark

    • Norway

  • APAC   

    • Japan

    • China

    • India

    • Australia

    • South Korea

  • Latin America

    • Brazil

    • Mexico

    • Argentina

  • MEA (Middle East and Africa)  

    • South Africa

    • Saudi Arabia

    • UAE

    • Kuwait

Key players

• OnDeck

• Prosper Funding LLC.

• Funding Circle

• LendingClub Bank.

• LendingTree, LLC.

• RateSetter

• Avant, LLC.

• Social Finance

• Zopa Bank Limited

• auxmoney GmbH