P2P Lending Industry Is Likely to Grow at a Momentous Pace; Here’s Why

The market participants and research reports are pointing shining future for P2P lending industry in the next five to ten years. Borrowing money through just a few clicks on the web makes this platform really attractive for people and small businesses all over the world.

Person to person lending along with lower fee structure and considerable returns for investors continues to expand the market share of this industry over the past five years.

The robust growth of this emerging industry in the past five years is evident by the performance of P2P lending platforms. For instance, Lending Club, which is one of the largest and regulated platforms in this industry, has loaned close $45 billion among 2.5 million customers. It’s also essential to note that Lending club has experienced significant growth in loans every quarter since 2013.

Other big platforms like Upstart and Fund Rise has also been reporting a similar type of numbers over the years. Both platforms are growing at a high double-digit rate.

P2P Lending platforms are offering opportunities to both borrowers and lenders; the borrower gets a loan on easy terms and conditions while the lender receives a better rate of return on invested capital. Fund Rise, for instance, has returned more than $65 million to investors in the last year alone and its average rate of return stood around 12% in the past five years.

Market participants are expecting high double-digit compound annual growth in peer to peer lending platforms. Allied Market research shows that this industry could easily grow by an average of 50% in the next four years. The interference of regulators and government agencies has made this industry more attractive and reliable for both borrowers and investors. The innovation of more solutions and loans types for micro, small and medium enterprises adds to the growth projections.