P2P-crediting

1. P2P-crediting as service exists since 2005. The British company Zopa which during the existence issued loans for £500 million and being the largest player in the British market of p2p-crediting about more than 500 thousand clients was now the first in the market.

2. P2P-crediting is not crowd funding. At classical crowd funding individual investors integrate and finance the company owning property in exchange for a share in it. At p2p-crediting creditors finance directly the individual, the owner. At crowd funding the investor receives increase in the capital, and at p2p-crediting — income, and the risk level at p2p-crediting is lower, than at classical crowd funding.

3. Select three types of p2p-crediting — consumer, financing of small and medium business, crediting of the real estate.

• In consumer p2p-crediting small unsecured loans are issued to individuals. As a rule, it is used for financing of large purchases, weddings, holidays, repair of the house, or for consolidation of debts.
• When financing small and medium business the loan is issued to the company and can be unsecured, either the secure property of the company, or personal guarantees of the director or shareholders of the company. The type of loans is most often used for financing of growth of the company or purchase of assets.
• At the crediting of the real estate used by individuals and the organizations for purchase of housing and a commercial real estate, the loan is provided with pledge of the first stage on property.

4. Loans at P2P-crediting are separated into small parts. It allows creditors to lower a risk degree, financing a set of small loans from $25 and if some of them are not returned, it will affect quality of a portfolio a little.

5. The most reliable method secure a loan at p2p-crediting — pledge of the first stage on property. At this form of protection of the credit the property which is in pledge can be sold for a debt covering, and the p2p-credit — the first that will be covered after pledge sale.

6. Monthly through p2p-platforms there pass millions of dollars. It is planned that by 2016 the size of the market of p2p-crediting will be £5 billion in Great Britain, to $30 billion in the USA and to $60 billion worldwide.

7. The credits through the p2p-platform are on average cheaper, than on the credit card. It is shown by practice of Lending Club, the largest operator of p2p-crediting in the USA. If to compare loans in $10,000 taken through Lending Club under 12.4% and via the credit card under 18.5% in five years according to the card it is necessary to pay $3050 more for the credit. It is not surprising that the vast majority of the p2p-credits is issued on restructuring of bank debts.

8. Investment into p2p-platforms can be less risky, than investment in the stock market. During financial crisis in 2008 the stock market of the USA dropped by 53%. Investors in p2p-crediting for the same period lost about 3% (statistics of Lending Club).

9. It is more profitable to give the credits for a holiday, than for training. Profit maximization requires from the p2p-investor to select the financed loans more than by 30 different criteria. On average most of all profit is made by loans for refinancing of a debt (8.5%), they are followed by loans for the organization of weddings (8%), for moving (4.2%) and for a holiday (3.8%). Loans for training bring to investors profitability less than a percent.

10. Loans with a good ratio of benefit to risk are financed within thirty seconds. New loans are available to investors several times a day, but among investors the competition for profitable loans is so high that the last are financed almost instantly. It makes work of the p2p-investor in something similar to high-frequency trading — it is necessary to manage to intercept the advantageous offer before others.

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