P2P Lending- Banking the Unbanked
PaisaDukan introduces loans for elderly people with Varishtha Nagrik Vittiya Samadhan (VNVS)
There were a lot of people who were not privy to the banking system. This has been curbed down, with the introduction of P2P lending, where it has exposed this large population to such a financial system directly. It has become an alternate source to borrow money for borrowers and a way to diversify their investments in order to reduce risk for investors.
The P2P platform provides a lot of transparency. Companies report to RBI and any kind of non-compliance can result in them losing their licence or getting imposed a heavy non-compliance penalty. By such reporting, the platform magnifies transparency and increases the trust amongst the general public.
Regulation has brought a lot of positive impacts in the industry. P2P companies have eliminated intermediaries and they facilitate in matching borrowers and lenders through their platform for easy lending and borrowing. More than 70% of the businesses are turning bootstrap and fund themselves. The number increases tremendously when it comes to individuals.
PaisaDukan, is the first new entrant to get in principal approval of Reserve Bank of India, it has been on the rise since getting the Certificate of Registration (CoR). They have shown steep growth in their segment and are one of the top ten emerging P2P lending companies in India.
The way our government is inculcating this digital culture amongst us, it has motivated many people to venture in this business. PaisaDukan aims to contribute in making India digitally advanced. Their focus is to serve India’s traditionally under-served populace; they ventured into peer to peer loan business where their mission is to provide a world class platform for borrowers & lenders.
The past few years have transformed the NBFC sector in to an important segment of the financial sector in India, because of its substantial growth, it contributes to almost 10 per cent of the total assets in the financial sector. P2P lending platform in India is predicted to play a crucial role in enriching India’s growth. Currently this sector is at an introductory stage, but is poised to be a USD 4-5 billion industry by 2023.
Risk v/s Reward
P2P market place provides lenders an opportunity to diversify their investments which makes it more rewarding. This helps investors to diversify their portfolio across multiple risk buckets. With the help of advanced primary and secondary research that has been performed by the industry experts and analysts through the best accessible techniques, this has enabled the creditworthy borrowers to lower their cost of loans and individual lenders/investors to lend directly to their peers and community thereby earning higher returns and eliminating the scope of middlemen whatsoever.
Varishtha Nagrik Vittiya Samadhan
In order to get everyone in to the system, they have introduced the same facility to the elderly people and they aim to make a more friendly system for the people wherein they can get loans according to their needs and also generate alternate income. It gives them the opportunity to earn Risk Adjusted Return of 10% to 12%.