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P2P Lending [2024] | Top 7 Platforms to Invest | Pros & Cons

P2P Lending [2023] | Top 7 Platforms to Invest | Pros & Cons

Summary: In this guide, we delve into peer-to-peer (P2P) lending, a revolutionary approach to lending and borrowing that connects individual borrowers and lenders directly. We will explore the top 7 P2P lending platforms of 2024, offering detailed insights into their features, benefits, and potential drawbacks.

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What is a Peer-to-Peer lending?

P2P lending has been around for a long time and practiced among individuals even before banks had been established. Today, modern technology has allowed the lending process to take place online, prompting the rise of P2P lending platforms.

For a long time, banks were the primary loan providers by utilizing the funds made available by their clients (also the lenders) to whom the bank pays a low-interest rate, allowing banks to apply a higher interest rate to the lent money to make a profit.

The benefits of P2P lending are positive to both creditors and recipients: loans are provided faster, more conveniently (online) and more transparently. Mutual lending platforms do not have a fixed interest rate creating a natural competition between investors, that drives the interest rate down. 

Another important point is that lenders’ risk is diversified. This means that several to tens or even hundreds of creditors invest in one loan. This reduces the loss in case the borrower’s insolvency because the loss is shared between multiple investors.

Currently, most peer-to-peer lending platforms operate in the UK and the US with the trend coming to Europe and some Asian countries. The very first P2P platform, Zopa, was launched in the UK in 2005. The P2P lending In the UK became so popular, that even the government started to invest.

The benefits of P2P lending for investors and borrowers

Benefits for investors:

  • Peer-to-peer lending platforms are particularly attractive to those who want to get a higher financial return without putting in a lot of work. According to the data of the Eastern European banks, in 2019 the average annual interest rate on consumer loans ranged from 10.63% to 11.58%. However, with enough experience, knowledge and a clear investment strategy, you can earn up to 20% a year profit.
  • It is not necessary to invest large amounts: you can start investing with as little as 5 EUR.
  • It requires less knowledge and experience than other popular investment methods (such as stocks or bonds). Some of the platforms even have an automatic investment option.

Benefits for borrowers:

  • Fast loan terms: often, money is transferred to the specified account on the same day.
  • Opportunity to borrow money cheaper than taking a quick loan.
  • Larger amounts can be borrowed without collateral.
  • No down payment is required.
  • No need to go to the banks, fill out tons of documents and so on. Everything is handled online.

How to invest in P2P loans? Tips & Tricks

Before investing in loans through P2P platforms, you should thoroughly study all the terms and conditions and find answers to the relevant questions.

Risk management

When lending money, there is always a risk of losing your investment. There have been cases of insolvent borrowers on mutual lending platforms. It’s not advisable to invest a large amount of money into one loan.

However, if you intend to do so, you should pay extra attention and analyze who you are lending to, which is of course a good practice that should be applied to any loan you invest in. Mutual borrowing companies can provide data on a person’s credit rating and insolvency risk – to inform your decision better.

Example: insolvency risk ratio on the Neo Finance platform. Currently, some of the applications are now evaluated by Artificial Intelligence (AI) technology. The letter “R” indicates the loan purpose – refinancing.

Portfolio diversification

Diversification is a way of managing overall risk by investing in a variety of investment tools. Let’s say we invest 30% of our portfolio funds in real estate, 20% into corporate stocks and bonds, 10% each to gold, art treasures, foreign currencies, cryptocurrencies and loans.

  • Diversification can be applied not on your overall portfolio, but also within the P2P platforms themselves. You can achieve diversification by investing as little as possible in as many loans as possible, thus fragmenting the portfolio and reducing the risk of insolvent borrowers. Let’s say you decide to invest 1,000 euros in loans. You can lend the full amount to one person or lend 10 euros to 100 people. In the first case, if the customer is insolvent, you will lose all 1,000 Euros, in the second – only 10 Eur (of course, out of 100 people you may encounter more insolvent customers, but it is still less risky). Generally, the more money you invest in loans, the more borrowers you should have.
  • Diversifying loans over time. Too often, newbie investors want to invest a whole amount they have dedicated as quickly as possible to maximize their profits in the short-term. However, it’s important to understand that borrowers’ solvency is often dependent on the overall economy so there may be more insolvent customers when lending during specific periods of time. Also, there are periods of time when borrowers can face more expenses than usual such as after the biggest holidays of the year. So diversification over time is similar to price averaging strategy when buying stocks, you may miss out on some good opportunities, but the overall risk will be reduced.
  • Loan diversification between platforms. Different peer-to-peer lending platforms have slightly different business models and, at the same time, manage risk differently. So by dividing your investments between multiple lending platforms, you also reduce the risk of lending your money to insolvent borrowers.

Credit ratings

A loan or credit rating is an indicator that provides investors with information about the borrower’s ability to meet financial obligations. On mutual lending platforms, all clients are divided into categories 3 to 5 and receive an A to E rating:

  • A (A *) rating – low risk: The safest to lend, but lowest interest rates.
  • B (A) rating – lower risk.
  • C (B) rating – medium risk.
  • D (C) rating – higher risk.
  • An E (D) rating is a high risk, but when lending to E-rated customers, the highest interest rates (and profits, respectively) can be expected if the borrower will pay his contributions on time.

The lending rating is based on the borrower’s:

  • income;
  • financial liabilities available at that time;
  • credit history (verifies how the person has fulfilled financial obligations so far);
  • available collateral, etc.

Do not blindly rely on loan ratings alone, do your own due diligence on potential borrowers, sometimes even simple Google Search can reveal a lot. Also, keep your eye on the interest rates, the higher the interest rate, the more careful you have to be.

Investment plan

Your investment strategy should clearly define either your total or monthly investment amount, desired diversification level and loan management style.

Simply put, there are two types loan management styles:

  • Active loan management is when you spend a lot of time, actively analyzing, and selecting the loans in which you invest.
  • Passive loan management is when you let a platform invest automatically based on criteria pre-determined by you. 

It is best to form a long-term investment plan, usually ranging from 24 to 36 months and adhere to it consistently. You can always test both loan management styles at the same time and see which management style gives you the better results over time.

Cons of P2P investment

P2P investment also has several disadvantages:

  • Illiquidity is one of the main issues in P2P investing. As an investor, if you wanted to recoup your investment sooner than later, you would have to sell your loan portfolio on the secondary market. After selling the portfolio, you would only take out your principal investment and lose a commission percentage. Often, the process of selling a loan portfolio can take months or even more. You should only invest money that you won’t need anything else in the foreseeable future.
  • Unregulated P2P platforms that do not have financial institution status and/or license. This means that some P2P platforms out there are not supervised by any governmental authority and can end up using your deposits to make additional profits for themselves. In the event of a platform’s insolvency, you may lose the money you have invested. Therefore, you should always do your own due diligence on the P2P platform you plan to use. 
  • Lack of information about the P2P platform founders. Some P2P platforms are very secretive about their founders and shareholders; they purposely provide inaccurate data on companies’ activities and lack audits. This is another red flag that often points out unregulated P2P platforms. You should stay clear from the P2P platform if you suspect that information found can’t be verified via some other authority institution.
  • The procedure of recovering insolvent borrowers’ loans is, in some cases, unfavorable for investors. Some P2P companies in the EU (such as BONDORA) pass on debt collection costs to the investors. Another example is when the P2P platform fails to keep investors up to date on the loan recovery process for a long time. Below is an example of what notifications are received by investors on their insolvent loans:
Investors receive periodic notifications in most of the platforms’ investment dashboards. NEO Finance image.

Best P2P lending platforms

Here is our pick for the top 7 websites to lend money and earn interest (P2P lending): 

  1. Mintos
  2. Neo Finance
  3. Bondora
  4. PeerBerry
  5. EstateGuru
  6. Profitus
  7. Debitum Network

Let’s take a closer look at each of these platforms.

Mintos

p2p lending platform mintos
Mintos Loans. Source: Mintos.com
Loans funded on Mintos as of November 2023. Data last updated on: 17.11.2023. Source: Mintos.com

The firm works to invest in loans as straightforward as investing in real estate, stocks, ETFs, and any other major asset class. By redesigning how money moves across borders from the people who want to save and invest to those who want to borrow; Mintos is revolutionizing financial services and contributing to financial inclusion on a worldwide scale.

Mintos has demonstrated robust annualized returns when compared to various asset classes over a five-year period. With an annualized return rate of 7.9%, it has outperformed real estate, investment-grade bonds, high-yield bonds, and deposits, which stand significantly lower, with only stocks surpassing it at an 8.6% return rate. Consequently, investing in Mintos could potentially offer higher returns relative to several traditional investment classes.

Annualized return ranking among different asset classes. Source: Mintos.com

Indeed, a €100 investment  with Mintos in 2015 would yield higher interest as shown in the graph below. 

Investment growth on Mintos vs other asset classes. Source: Mintos.com

Martins Sulte, Martins Valters, and four angel investors launched the platform in 2015 in Latvia. These angel investors include Aigars Kesenfelds, Maris Keiss, Kristaps Ozols, and Alberts Pole. Mintos has raised around €7 million to date, and all of it has come from angel investors.

The team behind this platform is highly experienced to operate the leading marketplace for investing in loans. They work with a high sense of responsibility geared towards investors, clients, society, and the environment in general.

This company has offices in multiple countries around Europe, which makes its user base considerably large and diversified. Mintos develops the best practices and industry standards in the way they do their work.

Notably, the company is an equal opportunity employer, and it supports an environmentally friendly community. It runs its business by following all the responsibilities that are stipulated in the Mintos Environmental Policy.

Pros and cons of Mintos

Pros

Pros

  • Mintos is a peer-to-peer platform that offers high-interest rates. Thus, it is quite appealing for lenders. The platform and company are profitable, which makes it a viable investment option for anyone seeking to make some profit through lending loans;
  • Due to its wide coverage of many countries especially in the European zone, the platform offers a large number of loans. It has a high level of diversification with 70+ loan originators from 33 different countries. Furthermore, it offers automatic investing services with the same filters as manual investing;
  • For anyone seeking an early exit, the service is available through Secondary Market. The predictable cashflow with Buyback Guarantee makes the investment strategy a viable option for the lenders and those who are seeking loans.
Cons

Cons

  • Some of the loans have an indirect investment structure, and some of the Buyback Guarantees/loan originators are, to some extent, financially weak;
  • The platform needs lots of research since only the legally grey-zone lone originators are accepted;
  • All alternative investments with the possibility for high returns come with extensive risk, and Mintos is not an exception.

Recommended video: What is Mintos?

Short video about Mintos. Source: YouTube Mintos MarketPlace

Neo Finance

p2p lending platform neofinance
Neo Finance homepage. Source: Neofinance.com

Recommended Content:

Interview with NEO Finance founder Evaldas Remeikis.

Summary: During the interview, the P2P lending platform NEO Finance founder talks about the current state of the relationship between P2P platforms and traditional banks in attracting new clients. Additionally, he gave the future outlook of the P2P sector and notable trends to look out for.


At the moment, the platform has 15,223 active investors who have invested over €100 million euros. The company discloses that one active investor invests in 259 loans on this platform on average.

NEO Finance platform’s performance since the company was launched back in 2014.

It is the first and only Lithuanian P2P platform operator to have the unlimited EMI license that supports operations in the whole of the European Union. Neo Finance guarantees the safety of clients’ money since it is kept in an account that is separate from that of the company. Furthermore, the company is continuously supervised by the Bank of Lithuania.

Whenever the agreements with borrowers are terminated, the investor can sell their investments for 50-80% of their face value to Neo Finance. Interestingly, a unique service of the Provision Fund lets investors reduce their investment risk in the scenario that loan defaults, Neo Finance repays investors with all the company assets as collateral.

Pros and cons of Neo Finance

NEO Finance is a P2P platform that delivers higher transparency than most of its competitors. No wonder it has many advantages and only a few disadvantages:

Pros

Pros

  • No investment fees are charged on this platform which increases the profit margins for the investors;
  • The platform’s unique service of the Provision Fund lets investors reduce their investment risk if loan defaults arise;
  • Neo Finance comes with secondary market capabilities. Investors can sell their investments for up to 80% of their face value to Neo Finance when the agreements with borrowers are terminated. Neo Finance can auto-invest on behalf of the investors and it guarantees a high average return on investment.
Cons

Cons

  • Previous users have complained about a few diversification options that curtail the amounts of profits that they make.

Recommended video: NEO Finance

Short video about NEO Finance. Source: YouTube NeoFinance

Bondora

p2p lending platform bondora
Bondora’s homepage. Source: Bondora.com

The firm has a great record in P2P lending services and offers a great way to borrow and lend depending on their needs. Bondora primary target is to offer investors a smooth and fast user experience enhanced with automated investing in P2P loans.

The company focuses primarily on non-secured loans with a principal of 500 EUR to 10,000 EUR. The loans come with a repayment term that ranges from 3 to 60 months.

Peer-to-peer lending does not involve any bank. Lenders and borrowers are connected through platforms like Bondora. The firm is run by a professional operation team that has a strong background in asset management, consumer credit, and retail banking.

Besides the management and supervision members of the board, the main stakeholders in Bondora are mainly subsidiaries linked to a US-based private investment firm. That investment firm has over 3.4 billion USD, and Global founders’ capital is the biggest shareholder.

All the loans offered through Bondora Group are unsecured consumer loans. It is also possible to automate investments, and the loans can be traded on a secondary market.

For easy and simple lending, the platform has come up with a product known as ‘Go & Grow’ that enables users to get up to 6.75% from Bondora’s portfolio. The platform’s portfolio has more than 100,000 loans. The users still manage to withdraw the investment faster than if selling various individual loans on the secondary market.

Pros and cons of Bondora

Just like any other P2P lending platform, Bondora comes with its pros and cons. However, the pros outweigh the cons:

Pros

Pros

  • Spain, Estonia, and Finland are the company’s target markets. These nations have a low debt to GDP ratio, which makes them an excellent destination from a lender’s point of view;
  • Secondary Market and automatic investing are available on Bondora. The ‘Go & Grow’ feature enables users to get up to 6.75% from Bondora’s portfolio. Moreover, this feature supports fast diversification and quick withdrawal.
Cons

Cons

  • When using Bondora, the actual returns are noticeably lower than expected whenever investing in single loan notes.

Recommended video: Welcome to Bondora

Short video about Bondora. Source: YouTube Bondora

PeerBerry

p2p lending platform PeerBerry
PeerBerry’s homepage. Source: Peerberry.com

The leading P2P marketplace lets users earn their lifestyle investing in consumer loans originated primarily by Aventus Group and its subsidiaries. PeerBerry is carefully expanding its loan originators network seeking to provide users with more diverse investment opportunities. The team behind this project strongly believes that passive income assures a stable economy and a better lifestyle. Hence, their mission is to provide passive income to everyone.

Profitable since its first year in operation in 2009, Aventus has become a credible innovative, and successful lender. PeerBerry uses the most modern online tools and solutions to offer transparent, simple, and fast service. Its continuous investment in IT solutions and infrastructure to support growth and satisfy customer demands.

Pros and cons of BeerPerry

Pros

Pros

  • PeerBerry is an easy-to-use platform that offers a competitive return on investment;
  • Since the platform is owned by a profitable company, investors are guaranteed to get the promised return on investments, unlike other platforms that make promises that they sometimes fail to keep;
  • The platform offers excellent buyback guarantee terms that attract many investors;
  • Its auto-invest feature ensures that the investors can take advantage of any lucrative opportunities that come up even unexpectedly,
  • No investment fees are charged on the platform which increases the profit margins for the investors;
  • PeerBerry’s great loyalty program rewards the users for their unending endorsement and support for the platform.
Cons

Cons

  • Its only shortcoming is the lack of a secondary market which means that the investor must wait until their contract expires or the borrowers pays the entire amount equivalent to the loan given.

Recommended video: Reasons to get started with PeerBerry

Short video about PeerBerry. Source: YouTube PeerBerry

Estate Guru

p2p lending platform estateguru
EstateGuru’s homepage. Source: Estateguru.co

The platform uses wide-ranging risk assessment technology to analyze many data points to support the decisions made by the credit team. From the many applications coming from different European countries every month, EstateGuru releases those that pass strict screening processes on their investment platform.

Once they release a project to the investor pool, the funding round begins. After a project is fully funded, which might take just a few minutes, the involved parties sign the contracts and the money is released in full to the loan applicant. The borrowers repay based on the agreed schedule while the investors track all repayments on their portfolio pages.

Pros and cons of EstateGuru

Pros

Pros

  • The high-interest rates that it offers are unrivaled by its peers;
  • All loans available on this platform are collateral backed by property which increases confidence among the investors;
  • Since 2013, EstateGuru has created a remarkable track record offering interest rates of up to 12.5%;
  • The platform has a secondary market available for anyone who wants to to exit their commitments before the initially agreed upon timeframe with the funding recipients;
  • EstateGuru has a direct investment structure which makes it easy for the investor and recipients of the funds to work together seamlessly.
Cons

Cons

  • While EstateGuru presents alternative investment options with the possibility of significant returns, they come with a considerably higher level of risk;
  • In contrast to similar platforms that accept a minimum investment of €100, EstateGuru requires a higher entry point with a minimum investment of €250;
  • The platform offers lower yields than competitors and charges a 2% selling fee on the secondary market.

Recommended video: How EstateGuru works?

Short video about EstateGuru. Source: YouTube EstateGuru

Profitus

p2p lending platform profitus
Profitus homepage. Source: Profitus.com

The company’s business conforms to the highest standards since it is maintained by the Bank of Lithuania. All the investment opportunities on the Profitus platform are secured by a mortgage. The company raises money for the development of real estate projects and other business loans. However, in all cases, the borrower is required to pledge real estate as a guarantee to the investors.

Pros and cons of Profitus

Pros

Pros

  • Profitus is a very user-friendly real estate P2P lending platforms in terms of design;
  • Profitus enhances investor confidence by adhering to the highest market standards, maintained under the oversight of the Bank of Lithuania, and by collaborating with reputable institutions, thereby boosting its credibility despite the inherent default risks influenced by factors outside investor control;
  • All investments on the platform are secured by a mortgage which protects the investors from defaulters;
  • Profitus offers a 1% cashback bonus for new investors which is calculated from their investment within the first 30 days after registration;
  • The company’s commitment to increasing user trust is evident in its dedicated statistics page, providing transparency and fostering a more informed and confident user base;
  • It also holds users’ money in a separate bank account which ensures that no money is absorbed by the company which is meant for investment by the investors;
  • The company does not have any suspicious terms and conditions which makes it quite popular among investors of all levels.
Cons

Cons

  • The platform lacks investment opportunities, has no secondary markets, and does not have auto investment tools. As a result, unless Profitus begins listing new investment projects, it remains quite challenging for investors to build well-diversified portfolios here;
  • While other platforms allow selling of investment on the secondary market for anyone who wants to, Profitus requires you to wait until the end of the loan term or until the borrower repays to withdraw your investments. That can take from six to 18 months.

Debitum Network

p2p lending platform Debitum
Debitum’s homepage. Source: Debitum.network

While using this platform, all investments come with an extra guarantee for all investors. All loans issued through the platform are analyzed by third-party risk assessors. No fees are charged in the platform and all investors are accepted immediately after vetting. Debitum Network allows the depositing of GBP, EUR, and USD.

Each partner earns 10 EUR per lead provided that the lead registers, confirm the registration, and deposits at least 100 EUR on the platform. Asset-backed loans are offered immediately by loan originators to small and medium-sized businesses. Users can co-finance or refinance the provided loans enabling them to earn straight from day one.

Pros and cons of Debitum

Pros

Pros

  • Debitum Network provides you with a large volume of loans which makes it a viable investment tool;
  • Risk management on the platform is taken seriously will all the loans issued through the platform are analyzed by third-party risk assessors;
  • It is easy to use and convenient even for beginners since no fees are charged and investors are accepted shortly after vetting;
  • The site’s ergonomics have improved a lot letting users co-finance and even refinance the available loans enabling them to earn some profit from the first day of their investment;
  • There are short, medium, and long term loans available and they all come with a buyback guarantee. With just 10 Euros, you can invest through this platform.
Cons

Cons

  • Many investors complain about low returns and lack of a secondary market;
  • The platform requires you to wait until the end of the loan term or until the borrower repays to withdraw your investments.

Recommended video: What is Debitum Network?

Short video about Debitum Network. Source: YouTube Debitum.

Before investing in P2P/P2B platforms

We highly advise to consider the following points before investing in P2P/P2B (Peer-to-Business) platforms:

  1. Credit market share of P2P platform. Look into what credit market share the platform has. Generally speaking you want to find a P2P platform that is a leader in the space or at least has a significant credit market share. This is a good indicator that such a P2P platform can be trusted. 
  2. Platform transparency and results. How easy can you find information about the platform’s investment performance? While past performance is not intended to predict future performance, it is still critical in deciding whether a P2P platform can be trusted.
  3. Securing Your Money: Who Are You Lending To? Is the main contingent of borrowers – individuals or companies? How is a security assessed? How many loans are secured? What is the process of loan recovery in the case of the borrowers insolvency?
  4. What do other investors say? Read reviews from other investors, platform’s ratings, and more. It will also help you to decide if a certain P2P platform is the right choice for you.
  5. Approachability: If you have any questions or doubts, call and find out any ambiguities you did not find on the website and FAQs page, see how easy it is to get through to the agents. That will be a good indicator, how quickly they will be able to help you if you have an actual issue with the platform in question.

To sum up, while peer-to-peer lending platforms can be great investment tools, the great returns do not come without knowledge and experience, it will take a lot of practice, analysis and some luck to capitalize on P2P lending. Please also note, that any investment carries certain risks and never invest money you can not afford to lose.

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FAQs about P2P lending

What is peer-to-peer (P2P) lending?

Peer-to-peer (P2P) lending is a strategy that enables people to get loans directly from other individuals without the involvement of a financial institution as the middleman. Sites that support P2P lending have majorly increased its adoption as a viable alternative financing method. P2P lending is also known as crowdlending or social lending. It has only existed since 2005 but competitors in this space are increasing rapidly.

What is peer-to-business (P2B) lending?

Peer-to-business (P2B) lending offers individuals a chance to lend money to established businesses. This form of lending was only previously open to large institutions and banks. This method of financing works by matching funds from the public to property projects that are managed entirely by qualified, experienced, professional real estate developers and investors. Every opportunity is analyzed through the underwriting process to guarantee a fair and stable interest rate based on the risk and return profile of a specific loan.

How much can I earn with P2P lending?

There are some qualifications that one must meet before they start profiting from their investment in a P2P platform. The type of lending is verified among the users resulting in the current changes. P2P lending ensures that the user enjoys some financial gain. The amount of money acquired changes from one place to another and from one jurisdiction to the next. Thus, in the end, it is possible to make considerable amounts using P2P lending platforms normally between 5% and 10% annually.

What Is the minimum deposit needed to start P2P lending?

The minimum deposit needed to start P2P lending varies from one platform to the next. But, most of the major P2P lending platforms have set the minimum at around €50 – €100, but some platforms are accessible with the only €5 initial investment deposit. The debt-to-income ratio should always remain below 40% to ensure that the users get some significant amount of profits. A long term investment plan spanning at least 24 months may guarantee success for your investment. You can succeed in this field irrespective of the amount of money you decide to invest in the venture provided that you invest correctly.

What are some of the best P2P lending platforms?

Some of the best P2P lending platforms are Mintos, Neo Finance, Bondora, PeerBerry, EstateGuru, Profitus, and Debitum Network. Each platform has its unique features and investment opportunities, catering to different investor needs and risk profiles.

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