P2P loan schemes
The business model is simple: They connect lenders and borrowers and take commission for connecting these two. They don’t guarantee your money and leave the entire risk of default on lenders. At most they will hire some recovery goons at your cost. No wonder avg rate of return(?) is 21%. In such unregulated finance market rates are on monthly basis generally 3%+ per month. (I have seen people charging 10% per month).
- For a lender it is risky unregulated market with insufficient track record. For diversifying your investment there are much better avenues. We can discuss on that.
- For borrower with poor credit rating and who can’t get loan, can try this instead of local finance shops.
My suggestion is NO to this. For people who seek some excitement in investing can invest 10K (minimum as mentioned by loanmeet).