All you need to know about the RBI guidelines for the P2P space in India

1. Capital Requirement:

RBI has mandated the capital requirement for the existing as well as the aspiring NBFC-P2P.

“Every company seeking registration with the Bank as an NBFC-P2P shall have a net owned fund of not less than rupees twenty million or such higher amount as the Bank may specify”

2. Effect of Guidelines on an existing p2p lending platforms in india:

The guideline has mandated registration of existing NBFC-P2P to the Department of Non-Banking regulation. An existing peer to peer lending platforms shall complete the application within three months from the date of issuance of the Directions.

“Companies that are undertaking the business of peer to peer lending Platform, as defined at paragraph 4(1)(v) of these directions, as on the date of effect of these directions, shall apply for registration as an NBFC-P2P to the Bank within 3 months from that date. Such companies, which have applied to the Bank for registration as an NBFC – P2P, shall be permitted to continue the business of a Peer to Peer Lending Platform till their application for issuance of CoR is rejected, subject to such conditions, including winding down of business, as the Reserve Bank may impose.”

3. Lending Guidelines:

The RBI, in the guidelines, has sought to reduce the risk to retail investor. The lending amount per person has been capped to one million rupees (INR 10,00,000/-) across NBFC-P2P. The guideline however is silent on institutional lenders. Also, exposure of a single lender to a borrower across NBFC-P2P has been capped to rupees fifty thousand (INR 50,000/-).

The capping amount is beneficial for retail lenders as it would reduce the risk. However, it would be a pain point for HNIs and UHNIs who understand their risk and are interested in taking a bigger exposure.

“The aggregate exposure of a lender to all borrowers at any point of time, across all peer to peer borrowing sites, shall be subject to a cap of 10,00,000/-.”

4. Nature of Loans:

The guidelines have only allowed NBFC-P2P to originate unsecured loans linked to its platform. It is good as well as bad. Secured lending products are complex in nature and RBI might have thought about instances of mis-selling of those Online loans. However, this will affect innovation in the sector to some extent.

“not facilitate or permit any secured lending linked to its platform; i.e. only clean loans will be permitted”

5. Capital and Return Guarantee:

RBI has mandated to receive explicit affirmation from participating lenders about the risks involved in the transaction. NBFC-P2P shall not guarantee any return and entire principal may be lost in case of a default by a borrower. NBFC-P2P also cannot guarantee the recovery of loans.

“not provide or arrange any credit enhancement or credit guarantee”.

6. Focus on Transparency:

The guidelines have emphasized on transparency during the activity of lending and borrowing. NBFC-P2P are required to disclose personal identity, required loan amount, interest rate and credit score, T&C of loan, likely returns, fees and taxes.

“An NBFC-P2P shall be required to disclose the following: (i) to the lender

(a) details about the borrower/s including personal identity, required amount, interest rate sought and credit score as arrived by the NBFC-P2P.

(b) details about all the terms and conditions of the loan, including likely return, fees and taxes;”

The emphasis is also on privacy as only a few details are asked to be shared between the lenders and borrowers.

7. Borrowing Limit and CIC reporting:

This is a significant step in the guidelines to discourage rampant borrowing across NBFC-P2P. In the best p2p lending sites for investors, A single borrowing individual can, at a time, borrow not more than one million rupees (INR 10,00,000/-) across all NBFC-P2P. Also, the details of the loan are to be mandatorily reported to CIC in the country.

“The aggregate loans taken by a borrower at any point of time, across all peer to peer sites, shall be subject to a cap of ` 10,00,000/-.

NBFC-P2P shall: (i) keep the credit information (relating to borrower transactions on the platform) maintained by it, updated regularly on a monthly basis or at such shorter intervals as may be mutually agreed upon between the NBFC-P2P and the CICs”

Click to know more: https://www.lendenclub.com/lending/

How does Vishal build a diversified financial future?

The success story of a LenDenClub Investor

Vishal is a Solution Architect at Infosys. Well-versed in traditional investment models, he wanted to try out new innovative investment avenues. Read about us in a news article, he decided to give LenDenClub a try.  Began his association with LenDenClub in April 2018 by investing INR 1,00,000 to get a feel of our platform.

Analysed and understood the investment platform and its unique features thoroughly, critically evaluated the process flow, he gained confidence and decided to considerably increase his investment. Also, he started diversifying his investments on borrower profiles across different buckets and maximized his returns.

Numbers that stand testimony for his success

Total amount invested:  INR 8,25,500
Annual Returns:  29.7%

His first investment (INR 50,000) was diversified across 30 different profiles.  As his confidence grew, he gradually increased his investment. Over a period of one year, Vishal diversified his investment on 550+ borrower profiles in various categories. Also, he kept on adding more funds and meanwhile rotated his EMIs every month. Not a rocket science though.  Some basic calculations and simple common sense. He is regularly earning annualised returns of 29.7%.

So, when you invest, don’t put all your eggs in one basket.

Start with an amount of your choice.  Choose your borrowers.  LenDenClub  as a money lending sites is a transparent platform and you are empowered to access the profiles of borrowers, analyse and choose wisely.  Diversify your investment across different profiles.  Wait and watch how it performs. One of the best p2p lending sites for investors where the investor start earning returns, increase your investment.  Also, you can reinvest the returns.  Up to 30% returns and that too from the very beginning is something you should not miss.

Like how Vishal did, distribute your eggs across baskets and earn solid returns immediately after investment.  Happy investing through online peer to peer lending

Click to know more at: https://www.lendenclub.com/

Started investing late in life? No worries. Let’s make the most out of it!

Maybe it took some time, some years, for you to settle in a stable job.  Maybe you were not one among those folks who got placed in MNCs during the last semester through campus interviews.  After graduation, you might have spent some time dabbling in some own business ventures.  Small ones.  And it didn’t shape up well.

Or you might have spent some years talking to that beautiful girl, without even being aware of what’s happening around you and where the world was heading for.  After she got married to a guy, to a ‘project manager’ who had been to North Carolina or San Francisco or Chicago for on-site projects, after the eye-opener, you got enlightened, found a job, worked hard and climbed on the ladder.  You reached a position of which you feel proud.

Now, you take pride in the fact that you have been paying income tax, the respect you enjoy and the responsibilities you have, that whenever you start talking to people around you, they lend an ear eagerly because you are a success and they want to emulate you.

But, in one aspect, you lag behind.  Savings.  Investments.  You are not alone though.  Most of the guys who began their career from zero in their late 20s are with you.

So what.  Let’s plan.  But, you cannot avoid that one thought that keeps on popping up in your mind as you go through the enticing ad banners on the Internet which prompts you to “Invest Now” - You should have started earlier.  Generally, mutual funds, a popular investment model in the market, consume a good amount of time to ripe.  A college junior, who got placed in an MNC during his last semester, who started investing at the age of 21, opined over WhatsApp that even if you start now, it may take more than a decade to see solid returns in your hands.  The duration and maturity periods mentioned in the websites of banks and famous investment companies are discouraging and disheartening.  Who can wait for years?  You are planning to get married next year.  You are planning to buy a car this year.  You cannot shell out a significant amount of money and wait for years.

But then again, is there any option?  An option from which you can reap benefits sooner. There might be and there must be.  But, it’s a risk to try such options.  They promise a bomb and suddenly one day they disappear. Why lose hard earned money?

Immediate returns and no risk are like day and night.  Can they exist together?

Yes.  They do.  On a reliable and transparent peer to peer lending platform.

For example, LenDenClub, one of the largest peer to peer personal loans platform in our country, has rapidly been gaining popularity among those who want to reap solid returns immediately after investment.  Traditional investment models demand a tiresome process and it might take years for maturity.

Whereas, a well-maintained investment portfolio in a reliable online money lending sites can fetch up to 30% annual returns which is not on the radar with other models.

Furthermore, the swift process, continuous support and guidance and flexible investment options have made LenDenClub the most sought after investment destination in the market.

So, for those who think they have started investing late in life, a p2plending platforms in india is the best choice to make up for what has been missed in the past.

Invest an amount of your choice at LenDenClub and start earning solid returns immediately after the investment.  Also, with your investment diversified on a range of profiles across categories, the risk is mitigated and no volatility.

Immediate returns.  No volatility.  Let’s go ahead and make the most out of it.

After all, life begins at 40.  Why not investment?  Happy investing!  

Click to know more at: www.lendenclub.com

Peer to peer lending platforms - Young generation’s favourite choice for investment!

Pranav, 27 years old, a software engineer, Bangalore.

He never thought he would find such a wonderful bride this soon.  Got engaged.  It was thrilling and exciting.  The phase of waiting.  Waiting for that wonderful woman to step into his life and tell what he should do and what he should not.  Time flew by.  The wedding date was just around the corner.  The initial excitement slowly subsided and it dawned upon him that life would not be the same any more.

Is he ready for married life?  What about his financial stability? A project manager in an MNC, he takes home a good package and has been honoured with bonuses at the right time.  But, in life, particularly after marriage, not everything can be planned and predicted. Some unexpected expenses would come up.  A birthday party, housewarming function, weekend trip, purchases on impulse, hospital emergency…Every day it will be a rollercoaster ride and some spare money in hands is crucial for a married man.

Pranav realizes that he needs a second income to lead a hassle free happy married life.  How can he rely on one single salary for which he has to wait for a month? A 30-day cycle is too long for this fast paced lifestyle.

Gopi, 26 years old, a BPO employee, Mumbai.

A charmer, he always gives his best to her.  Last February 14^th, it was a trip to Goa.  No one can be as creative as he is in fabricating occasions for gifts.  Can you guess how much he spends on gifts?

He never settles for anything less than 10 K!

You may wonder - a BPO employee, in the beginning stage of his career, how can he manage all these expenses?

He stays awake all night to attend the calls pouring from all around the globe - the labour of love.  Even though he works very hard to earn, he would exhaust his salary in the middle of the month.  He wished he had some extra money in his hands regularly so that he could impress her with more surprise gifts and outings.  However, a part-time job is not an option.  Already he is burning his soul round the clock at his current job.  No time or scope for such enthusiastic ideas.  He has some savings that’s in hibernation mode.  No movement.  No growth.  He can use it as capital to earn extra income.  But how? One mutual fund promises good returns in 36 months.  But there is a Saturday and Sunday every week.  He wants to see the returns sooner.

Karthick, 29 years old, a VFX artist, Chennai.

A responsible guy, the entire burden of his family on his shoulders, he has to keep an eye on every penny he spends.  After office hours, he comes back home and starts working on the projects he has committed on a freelance basis.  Even in the late evenings, you can spot him at his home, in the hall, sitting in front of his laptop, working; his wife in the kitchen; his kid, a toddler, laughing and screaming and walking around in the room.  A family man at work.  Always.

One thing that makes him lose sleep in the nights is, he hasn’t started saving or investing yet.  Sometimes it’s terrifying for him to think that there is no backup.  Now, whatever he earns in a month, in 30 days, is spent to survive the next 30 days.  The lion goes for a hunt, comes back with a prey, feeds the family.  The next day, the lion goes for a hunt.  Life cannot be like this forever.  The family needs a backup.  For dry seasons.  To manage emergency expenses.  With a blink of an eye, the kid would grow up and be ready for schooling.  The family expenses would keep on increasing in the future.  Apart from creating wealth and backup, there are festivals and occasions every month and the couple has to put a decent show in front of relatives, friends and neighbours.

Three different stories.  The conclusion is the same.  Be it Pranav or Gopi or Karthick, the reasons might be different.  The lifestyle might be different.  But what they need is ultimately money.

Million problems.  One solution.  And that is money.  Who can deny it?

Working and living in different cities, all 3 need some extra income regularly and have chosen to invest in peer to peer lending platforms.

While there are a range of traditional models and hundreds of options available in the market to invest, why did they choose p2p lending sites?

Because they cannot afford to take a risk.  Having said that, they want to earn solid returns from the very beginning.  Not sure whether it is possible with any of the traditional investment models. But an efficient and transparent peer to peer lending site can meet all the above mentioned demands without putting the hard earned money at risk.

For example, at LenDenClub, one of the largest online lending sites you can invest an amount of your choice and start earning solid returns immediately after investment.

Furthermore, the investment is diversified among as many borrowers as possible and thus the risk of poor performance is mitigated.

Flexible investment options.  Immediate returns.  No volatility.  All make sense.

So…Happy investing!

Click to know more at: https://www.lendenclub.com/lending/

Why peer to peer lending platforms are a prudent choice for investors?

For starters, let’s understand whatis peer to peer investing.  It’s an innovative investment method by which an individual with investment capabilities lends money through an  peerto peer lending platforms to another credible individual who needs money.  The online money lending sites enable, coordinate and facilitate people to lend and borrow money swiftly through moneylenders in india.  The entire process takes place through the mobile app and a great deal of time and effort are saved.  Then, the borrowed sum with interest is paid back to the investor on an installment basis as agreed. 

By investing in peer to peer lending, you can start earning extra income from the very first month.

As an investor, you get back the money with higher interest rates when compared to traditional investment options like mutual funds and fixed deposits.  No wonder, best p2p lending sites for investors has already become a preferred choice for those who look for hassle free investment options to earn returns quickly. 

As a responsible peer to peer personal loans platform in the market, we would like to share with you some thoughts.

Here it goes!  A good peer to peer lending companies  should empower you to access the profiles of borrowers and choose wisely.  You invest your hard earned money and you decide how much you lend to whom!  Interest rates might be enticing.  But, we shall bear in our minds that consistent support and service from the lending platform all through the process is as important as how much money you mint every month.  When you invest in peer to peer lending websites, make sure you invest your money on reliable sources / verified borrowers.  Of course, you can invest that extra income again in peer to peer sites, give a boost to your investment and grow your money exponentially.

Furthermore, you can start your investment with a small sum in online lending platforms. At LenDenClub, India’s leading peerto peer borrowing platform, you can start from as low as Rs. 500.  With a range of flexible investment options and higher interest rates, the platform has attracted and acquired thousands of investors – registered lenders – who have been earning ample returns every month.

For the aspiring Indians who have for all these years been just spectators in the investment field, this innovative investment option that promises quick returns has come as a boon.  Now, everyone can invest.  Everyone should invest.  Happy investing!

Click to know more: https://www.lendenclub.com/

Things you need to know about the P2P space in India

In the last few years, this world has witnessed many innovations in the field of finance. One of which is Peer-to-Peer Lending. It all started in UK when a company named ZOPA started peer to peer lending companies market place. Within no time, this lucrative idea was adopted by many in USA and countries around. The trend got spread rapidly across many nations, and soon India also became a part of this idea.

peer topeer lending india, commonly called as p2p lending investment, allows individuals to online lending platforms or borrow  money website to & from other verified individuals without any additional assistance from financial intermediary. p2p lending companies in india is a boon to people who may not be eligible to get loans from banks/non-banking financial companies (NBFCs). It lets customers take the position of lenders and earn interest. However, it comes with the same risk as bank loans.

However, the Reserve Bank of India (RBI) has come out with a discussion paper to regulate the fast-growing crowd-funding and best p2p lending sites forinvestors. Now that this space is gaining momentum and growing massively in India, the central bank finds it important to regulate the space.

RBI’s discussion paper signifies that the platforms should adopt a company structure that can then be regulated by the central bank and it can be treated as an intermediary NBFC. Currently, P2P platforms are run by individuals, proprietorship, partnership or limited liability partnerships — areas outside RBI’s jurisdiction. The discussion paper also sought to curtail the freedom of the peer to peer lending platforms companies significantly and said funds raised through the platforms should go directly from the lender’s bank account to the borrower’s.

After all these discussions, Peer to peer lending in India is witnessing impress growth owing to increase in demand of online loans and alternate credit instruments. The RBI regulation and digitization are also boosting the growth.

Though this idea is a little risky for a country like India, the power of advanced technology empowered best p2p lending india and got them many investors and lenders, making it one of the growing segments in India. If researches are to be believed, India can be one of the biggest offline contributions in peer to peer sites. Because, even today Indians rely on their families, friends and money lenders during cash crunch or financial requirements. Another study shows that the demand for p2plenders is about to increase soon as India will have more than billion internet users with each person getting access to online lending sites. Out of all this, did you know that peer to peer personal loans in India is expected to become Rs30,000 crore market by 2020? All these studies, researches, developments show that there’s still time for p2p lending companies in indiato become more organized and transparent. It holds tremendous potential and opportunities, and will only strengthen its roots further in India.

Read More at: https://www.lendenclub.com/

Debt Consolidation Loan – How to Get Over Credit Card Debts?

If you own multiple credit cards, you might be in debt. You can avail a debt consolidation loan from peerto peer lending companies to get over credit card debt.

Sudeep is an IT professional, owning three credit cards with different credit limits. Every month, his salary goes towards the payment of credit card bills, apart from home loan EMI and monthly household expenses. Most often, he fails to track the payment cycles of the credit cards and misses the payment within the due date. As a result, his credit cards are charged to exorbitant interest rates and late payment fee. He is neck deep in credit card debt. What he needs is a debt consolidation loan to make his life simpler.

What is a debt consolidation loan?

A debt consolidation loan is a fresh way out to refinance or clear out multiple loans with one single loan. In simple words, it means consolidating all your existing debts into one payment.

Why you need a debt consolidation loan?

• It can help you to pay off all your debts at a low cost.
• It can save you from keeping track of multiple cards, bills, EMIs and different payment cycles.
• It can improve your credit score in the long run.

Where can you avail a debt consolidation loan?

Several banks and financial institutions offer a debt consolidation loan. However, given your poor credit history and failure to make timely credit card payments, they may not be willing to give you a loan. Even if they lend you money, it would be at a very high interest rate and with stringent guidelines.

But, don’t be disappointed. The peer to peer lending companies in India will offer you a debt consolidation loan, no matter what your credit score, income or amount of debt is through p2p lenders.

What are the benefits of applying for this loan on a peer to peer personal loan? Easy processing

• Flexible interest rates based on an internal credit rating process
• A large database of personal money lenders in india
• Transparent transactions, no hidden fee
• Quick transfer of funded loans
• Easy repayment through pre-determined EMIs

What is the process of applying for this loan on a best p2p lending sitesfor investors? You have to fill up an Instant Personal Loan application form, pay a nominal registration fee and submit your KYC documents. A few peerto peer sites companies in India such as LenDenClub will approve your request within 18 hours. Post the approval, you can immediately start borrowing from instant personal loan online lenders registered with the portal.

A debt consolidation loan availed through a peer to peer lending marketplace can put all your multiple credit card management worries to rest.

Read more at: https://www.lendenclub.com/