P2P lending

As there has been set more and more legislation limiting the market of payday loans, peer to peer lending has done more rising to be one of the channels to borrow money, when it is most needed. Similar to crowdfunding, peer to peer lending is method where group of investors invest and lend money to personal or business use.

Small and medium sized companies use p2p loans to invest in their business or pay the debts. The interest rates in peer to peer loans are lower (in general) compared to payday loans, but also the requirements for the applicant are bigger. As payday loans are highly restricted by the law, peer to peer loans are still easier to get. Especially, if you compare p2p loans to traditional personal loans, the interest rates are higher, but the requirements are lower. 

Even the p2p loans have been around for long time already, the remain pretty unfamiliar to many of normal people. The applying process for p2p loan is simple and straightforward. You register to a website, choose how much you want to loan and give some background information about yourself. Then you simply click and apply for the loans. Next the lenders will see you application and can decide if they want to invest on your loan or not. The decision is based on the amount you are applying among other things. They will calculate and base the decision on your home city, your salary and your credit score, etc.

In UK and U.S.A the markets of peer to peer lending are billion markets. Some of the major US companies are Prosper and LendingClub. Before making the decision to take a peer to peer loan, it is a good idea to compare the interest rates among other details of the loans.