You can consider a new option in the debt segment other than traditional debt instruments such as debentures and bonds – peer-to-peer (P2P) lending, which has emerged as an attractive avenue for people who don’t mind taking some additional risks for extra returns if you have money to invest for the short term. This involves lending cash to people or companies through online solutions that match loan providers with borrowers. Recently, perhaps the Reserve Bank of Asia (RBI) showed self- confidence when you look at the fledgling section by revising a loan provider’s publicity limitation across P2P platforms from Rs 10 lakh to Rs 50 lakh. Specialists say you can make returns that are good diversifying dangers across kinds of borrowers.
Key Regulatory Developments
P2P players have been around in presence since 2012, as soon as the very first platform ended up being launched. Initially, there clearly was extremely little oversight that is regulatory. Seeing the potential of the technology that is evolving development of financing in to the underserved, the RBI arrived on the scene with tips in September 2017, to transform P2P players into NBFCs by issuing NBFC-P2P licences. There are about 30 players that are p2P the nation of which 20 had got the NBFC-P2P licences as on October 31, 2019; the others have actually requested it.
One could spend as much as Rs 50 lakh across P2P platforms. The minimum amount is Rs 25,000. The RBI has specified that the tenure of the solitary loan cannot become more than 3 years. Read More