Wednesday, 21 Nov 2018

Need to Borrow Money: Opt for Private Loan Lenders

If you want to borrow money, you go to the bank. Or maybe you look at your parents. But did you know that you can also borrow money from private investors in Singapore? This can be borrowed through peer-to-peer loans. Peer-to-peer is attractive for both parties. For the investor, the interest rate is more attractive than that of a savings account. For the borrower it is cheaper than a loan from the bank. Unfortunately, peer-to-peer lending in our country has not yet got off the ground. But with the increasing number of private loan lenders in Singapore, it seems that it will not take much longer.

With peer-to-peer (also called p2p) you borrow money from other individuals. Why would you take out a loan from a bank at 8% interest? There are individuals who want to lend you money at 4.5% interest. As a saver you jump a hole in the air with 4.5% interest and as a borrower you cannot get cheaper. Banks continue to fall back on their strict standards. The private investor must also have guarantees, but will be more flexible.

Delivering a dream for a high return

Suppose you have a plan to start your own business. You draw up a business plan and you go with it to the bank. Before 2008, the plan was looked at with a positive eye, now you probably walk up against a wall. Banks do not want to dare to think anymore. There are wealthy individuals who are looking for an alternative way to invest money. Peer-to-peer brings these parties together.

What does peer-to-peer mean?

The bank is removed as an intermediary. A consumer lends money directly to the consumer. The principle is simple, but the implementation is difficult. You cannot simply provide loans in Singapore. The consumer is protected against himself for fear of overconsumption. You probably know the slogan: “Pay attention! Borrowing money, costs money”

New initiatives from the same thought

You can now find multiple parties on the internet that try to bring borrowers and lenders together. The idea is to find several small investors instead of one lender. Submit your plan and let investors register. Based on the financing that is being channeled through online sites, this initiative falls under the heading crowd funding.

The success of Online Sites

The peer-to-peer website is the fastest growing Singapore lender. These sitesare an online broker between the lender and the borrower.

Peer-to-peer is a good way to help each other. Savers want to put their money away against a high return. Consumers who just need extra money temporarily do not meet the perfect profile according to the banks. They cannot borrow money. Peer-to-peer could also be the solution for loans to SMEs. Banks are going to do more and more difficult. Let’s help each other!