The rise of P2P lenders

Peer to Peer (P2P) platforms available in Australia are steadily increasing – so should you consider using one if you’re looking for a personal loan?

P2P (peer to peer) lenders have been on the increase since late 2014. P2P lending has a long history in the USA and the UK, but it’s only recently arrived on our shores here in Australia. It involves borrowers taking out a loan with investors directly instead of going through a bank or other financial institution.

If you’re in need of a personal loan but you don’t want to give your money to a big bank, P2P could be an affordable alternative. Just be aware that they generally only offer small loans; you’re not going to be able to put your mortgage through a P2P platform. There aren’t any huge risks for borrowers in P2P lending, although there are some risks involved for investors.

Here’s our list as at November 2015:

 

Related article

Who offers peer to peer lending in Australia

 

ASIC Commissioner Greg Tanzer gave a speech in May 2015 about the benefits of P2P lending and other innovative methods of providing financial services, such as crowdfunding, digital currencies, and robo-advisors.

There are currently not any specially-designed regulations for P2P lending in Australia, because there are several different business models in operation, but P2P lending platforms must still be regulated by ASIC. There are several aspects of P2P lending platforms that are currently regulated by ASIC: