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Author Topic: What is p2p lending  (Read 193 times)
Quidat
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April 20, 2019, 05:33:10 PM
 #21

I won't go into the definition of the p2p lending because it is already available in various resource which can be fetched through Google search! Rather, I would tell you about my experiences with it! It is a failed business idea in crypto space! BTCJAM was one of the pioneers of crypto p2p lending which closed down their operations back in 2017 or in 2018 beginning. I had an account and I used to lend to a lot of highly ranked borrowers. Only 90% people defaulted and I received only 10% of my investment back. I would be at least 4 bitcoins richer today if I had avoided this p2p lending business back in 2016 and 2017. It's a flawed business idea because you can't really track down a person in Nigeria from USA for few hundred dollars! 
4 freaking BTC? Damn. I always knew that the p2p model was not sustainable or feasible in the long term due to the risks involved, but I did not know that this model was so heavily flawed in the crypto world.

Why do people even bother when there are way better alternatives out there? Plain stupidity.
Its always been the risk involved behind these p2p lending business.We say it is really flawed but there are still investors who do still sustain into this field.Not all people who do plan to have a lending business would succeed.
4 BTC is freaking a big amount and you cant really do anything yet tracing them down wont be an easy task and it would even cost you more.This is why most lendors of this forum do ask out some collateral which is more than on the amount you are borrowing incase they decided out to default.

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April 21, 2019, 06:50:19 AM
 #22

https://medium.com/@info_60688/what-is-peer-to-peer-lending-6d714dadc4e2
An article on peer to peer lending by Btccredit to explain the proposition of lenders and borrowers.
Do share your comments and suggestions.

I think it's more convenient to use p2p lending thank banks. However, with regards to security traditional lending is more secured than p2p lending. P2P lending cuts off interes rates from the bank plus service charge or fees. A lot of p2p lending had popped-out in our country, it's really easy to apply and it only takes hours or days to be approved. The lender takes higher risk since there's no way or limited ways for them to verify credibilty when it comes to timely payment.
I haven't fully understood how this p2p lending works because I have a lot of concerns, and one of this concern I have is that how can the lender be sure that he/she is going to get their money back in due time, since this is the blockchain space and you don't need to see the other party before you would be able to make transaction with them, I have been thinking of a method that would be suitable and save for both the lender and the borrower but I haven't seen any method yet, so how does this really works.
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April 21, 2019, 07:40:34 AM
 #23

P2p way of lending money i think is alot reliable then lending money from the bank,in p2p lending you can talk about the rates of interest and not be forced to pay in huge interest.Compared to bank where you need to pay huge fix interest rate
In the bank loans, you have the options to choose of whether a fixed or flexible rate of interest charge to the total loan amounts.
Or it can be a fixed rate for the 4 years and flexible on the remaining periods. But the common advantages of P2P credit systems is the low on interest rates compare to banks even the credit score you have from the bank records aren't as good.
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April 21, 2019, 07:56:38 AM
 #24

The risk is on the lender more than the bank, after delivering the coins there isn't much of a chance of getting them back unless legally secured against a valuable asset
That is right! But the lender got a protection against such circumstances. Actually, I sometimes go to Lending section of this forum to find something interesting in there and also taking a chance to learn someting new and here's what I noticed. The lender do not easily accept applicants, they interview it first mostly asking about their means of living or how they gonna pay their debt. Then if both parties agree, the applicant should give a collateral before closong the deal. The purpose of it is to let the lender at least get something valuable if the applicant suddenly btoke their deal. Collaterals could be in a form of crypto or crypto, bitcointalk account is not accepted.

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April 21, 2019, 10:04:43 AM
 #25

The risk is on the lender more than the bank, after delivering the coins there isn't much of a chance of getting them back unless legally secured against a valuable asset

I would like to mention here that on our platform there is a system that borrower has to deposit a collateral in Bitcoin or BTCC tokens, then only he can get loan. So the lender's fund is safe. Our goal is to ensure the fund protection and help others in need.

Ah! My question in mind has been answered. Risk is more on the lender's part and that kinda bothered me. Also, there was nothing mentioned in the article about collateral (as far as I can recall) so I wondered that if I was the lender, how will I be guaranteed that what I will lend will return to me, right? But since you have already mentioned about it, then I was relieved. At least, I am ensured that my fund is protected.

PS. If you are advertising this platform of yours, maybe you should move this article to a different section. Services section, perhaps?

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April 21, 2019, 10:48:00 AM
 #26

https://medium.com/@info_60688/what-is-peer-to-peer-lending-6d714dadc4e2
An article on peer to peer lending by Btccredit to explain the proposition of lenders and borrowers.
Do share your comments and suggestions.

P2P lending is a good concept and getting popular in crypto world,  but security and trust is big issue in this concept.  P2p lending is much cheaper and fast.  Cheaper because banks or other financial institutions is not involved in between so their interest cut and institution running cost is saved,  so it both lender and buyer got its benefit.  Moreover legal formalities can also be lenient and easy to fulfill.  But trust between two panties is the major factor for any such transaction,  which is really difficult to fulfill.
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April 21, 2019, 11:01:31 AM
 #27

https://medium.com/@info_60688/what-is-peer-to-peer-lending-6d714dadc4e2
An article on peer to peer lending by Btccredit to explain the proposition of lenders and borrowers.
Do share your comments and suggestions.

I think it's more convenient to use p2p lending thank banks. However, with regards to security traditional lending is more secured than p2p lending. P2P lending cuts off interes rates from the bank plus service charge or fees. A lot of p2p lending had popped-out in our country, it's really easy to apply and it only takes hours or days to be approved. The lender takes higher risk since there's no way or limited ways for them to verify credibilty when it comes to timely payment.
Although lenders exposed to many risks, the profits they earn are very high. There are many similar services available on this forum, and this is a service that many people use. To minimize risks, lenders only make unsecured loans to people with positive credibility. On the contrary, you must mortgage some equivalent assets to secure the loan.

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April 24, 2019, 08:40:36 AM
 #28

P2P lending would be a revolutionary ecosystem if it can be implemented with the help of the blockchain technology and can be totally decentralized.
I wanted to start my own p2p lending company but still trust is an issue for this. The one problem is the assurance that the people who gets the money should give to the lender if he is not able to return the money back.
Collaterals like Bitcointalk accounts etc. aren't a guaranteed strategy in my opinion.

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April 24, 2019, 08:47:35 AM
 #29

It is just the common form of lending that we see within our forum. Here no intermediary is found, no added charges same as that of the banking and collateral is a must. With banking there is a need for referral, collateral, then documentation charges. With p2p lending everything happens through internet ans this makes it riskier to the lending person.

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April 24, 2019, 11:42:50 AM
 #30

But the common advantages of P2P credit systems is the low on interest rates compare to banks even the credit score you have from the bank records aren't as good.

Really? You have some numbers to back this claim?
Btcpop has 15%, Ing has 6%

It is just the common form of lending that we see within our forum. Here no intermediary is found, no added charges same as that of the banking and collateral is a must. With banking there is a need for referral, collateral, then documentation charges. With p2p lending everything happens through internet ans this makes it riskier to the lending person.

Yeah, and everything is so perfect, let's get rid of the banks because we have this marvelous system. /sarcasm

So, let's take this scenario
a) traditional
- I went to the bank, filled the paperwork got a loan and I bought my house, close to 200k euros.

b) p2p
- I must gather 300k euros in coins , deposit them and I get a 200k loan so I can buy my 200k.....
If you don't see what is wrong with it then.....

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April 25, 2019, 05:34:23 AM
 #31

If you ask me I'd say that p2p is no better option because you're still going to give an asset that is worth the same amount of cash that you're borrowing from the platform. You're giving your asset because you don't want to sell it and you think that the price of the asset is going to increase, so you want to keep it locked in p2p lending and borrow cash and get back your assets when you return the cash you have borrowed with the interests.

I don't really fancy that, cause I'm not even sure of the assets, cryptocurrency is something volatile and you don't really know where it's heading to.
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