Peer To Peer Lending with LenDenClub

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PEER TO PEER LENDING With LenDenClub
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1. What is Peer to Peer Lending ?
2. Why Peer to Peer Lending ?
3. How do P2P platforms handle defaults ?
4. Ideal diversification

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What is Peer to Peer Lending ?

• Parties involved in Peer to Peer lending
• Borrower A person looking for an unsecured
  personal loan
• Lender or Investor A person looking to finance
  the loan proposal by a borrower
• P2P Platform A marketplace where a borrower
  can request for a personal loan and an investor
  can finance that loan

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What is Peer to Peer Lending ?
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Why Peer to Peer Lending ?

• P2P lending is regulated by Reserve Bank of
  India with effective from October 2017.
  Regulations brought more transparency in the
  process.
• It increases portfolio returns even if you
  invest a small portion of your portfolio in p2p
  loans, it will increase overall portfolio level
  returns.
• Systematic investment possible based on your
  investment preferences across risk and return
  categories. You may choose to invest on monthly
  basis if you want.
• No volatility like equity and mutual funds.
  There could be default by the borrower, which can
  be mitigated through micro diversification.

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How Do P2P Platforms Handle Defaults ?

• Before loan approval Right Selection
• KYC (Know Your Customer) for identity check
• Credit assessment process before the loan
  approval which includes personal, professional,
  financial, social status and credit history of
  the borrower
• Physical verification
• After loan disbursal Right Follow-up
• Soft collection through tele calling
• Physical recovery process
• Legal recovery process
• Credit reporting of repayments to credit bureau

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Ideal Diversification
As per survey conducted. For a 35 years old
investor.
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Thank You
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