Are Peer-to-Peer Loans a Good Small Business Idea?
Have you tried to get funding for your small business, only to get met with denials from banks and other big lenders? Peer-to-peer loans, or person-to-person loans, are a new and rapidly growing area where businesses can get some starter funding.
If you’ve heard of microfinance, the idea behind peer-to-peer loans is fairly similar. A large network of “lenders” come together to help borrowers raise money for various purposes.
Hundreds of lenders can ban together to help raise money.
Have you tried to get funding for your small business, only to get met with denials from banks and other big lenders? Peer-to-peer loans, or person-to-person loans, are a new and rapidly growing area where businesses can get some starter funding.
If you’ve heard of microfinance, the idea behind peer-to-peer loans is fairly similar. A large network of “lenders” come together to help borrowers raise money for various purposes.
Hundreds of lenders can ban together to help raise money. Lenders can put up between $25 to $1,000, reports The Wall Street Journal.
Popular sites for peer-to-peer lending include Prosper Marketplace and Lending Club. While most of the peer-to-peer loans on the site are for lenders who are looking to reduce their credit card debt, there is a growing contingent of small business owners, frustrated with the loan process with banks, who are also turning to the site, reports The Wall Street Journal.