What is Peer-to-Peer Lending?
Peer-to-peer lending (or P2P lending) gives more established businesses the opportunity to raise funding from private investors, providing an alternative method to traditional bank lending.
Funding is provided as a loan – or multiple loans depending on the sum required – to help businesses secure the finance required to fulfil a wide range of business purposes, for example to purchase new machinery, buy new stock or fund a new order.
Investors effectively bid for your custom through an auction, citing the sum they’re prepared to offer and quoting their required interest on the loan. As bidding intensifies investors will commonly drive the interest rates down – often below those offered by traditional lenders – leaving you with a choice of partners to work with.