P2P Lending | Marketplaces That Give Back to Society
We see Peer-to-Peer lending companies throw out the term "democratize finance" rather frequently without really addressing what it means. So we're going to walk you through it.
The first piece of information you should understand: The emergence and development of financial technologies or smart applications have enabled average individuals to operate as their own bank, manage their finances, send money and transact.
The second piece of information you should understand: The same development that enabled everyone to become their own bank has also enabled average people to earn interest on their capital by lending it to others, the way banks do.
These changes have brought about alternations in financial power and have disrupted our current credit markets, and consequently, our economy. This democratization of finance that is so popularly thrown around is quite literally the disruption of the current financial market which many believe is too centralized, regulated and monopolized.
Peer-to-Peer lending serves as the facilitator of this disruption. The platforms who provide lenders and borrowers a place to safely interact and transact are those at the forefront of democratizing finance as we know it.
Peer-to-Peer lending is not designed for those with large amounts of capital. But because of the low barriers of entry and comparative returns P2P lending is emerging in our modern age as investment worthy of being in anyone's diversified portfolio.
Many platforms who are advocates of this message like to put their money where their mouth is and issue programs and campaigns to donate to charity. While others do it less, many platforms dedicate vast amounts of resources to helping people achieve a stable economic position.
EstateGuru
EstateGuru issues a yearly program in order to assist those in financial need. During same years they issue a percentage of net profit on made on EstateGuru or raise sums of capital. Since 2016, the P2P lending platform has issued out percentage based commitments to donate money to charity. Such events can be located in EstateGuru's campaign section for more updates on future charitable processes.
EstateGuru every year issues a program whereby their team raises up money for children hospitals in Estonia, Germany and Latvia. EstateGuru is an Estonian peer-to-peer real estate lending platform. They are considered one of the best platforms in the world due to their attractively yearly returns and 100 percent successful fund recovery rate. EstateGuru offers many different types of real estate lending options on their platform, all of which comes with either a 1st or 2nd rank mortgage.
EstateGuru offers competitive interest rates of 8 - 13 percent whilst being one of the safest platforms for investors. The minimum investment entry on EstateGuru is 50 EUR. Most of the real estate properties issued on EstateGuru are part of Eastern Europe and some properties in Spain and Denmark. EstateGuru though already quite large, is still growing and hopes to expand all over Europe. The management and brains behind EstateGuru have proven themselves to be a great and recommendable addition to any diversified portfolio.
Kiva
Kiva started off as a P2P lending platform that wanted to cure the world of poverty. The founder, Premal Shah, believed that there was enough money in this world so that everyone would have the chance to eat. Kiva's entire idea is based off the concept that anyone can be financially stable if they just had a leg up, a chance.
Kiva is exactly that, borrowers of any income level put the reason for a loan, generally, it will be a way to make money to pay the loan back. Investors pick out which borrower they believe would be the most able to pay it back and their loan is filled.
Kiva's entire mission is to enable those with limited access to credit, receive it. Kiva has bettered the lives of millions around the world. Investing on Kiva starts at 25 USD and investors receive no interest on their investment. They are purely lending out their 25 dollars and are confident that they will receive the 25 USD back. Investors on Kiva are exposed to a large marketplace filled with individuals from struggling nations with real business ideas and motivation to get out of their economic disability.
PeerBerry
Aventus Group and PeerBerry have consistently made payments over the last several years to Dobrodiy. A hospital that dedicates themselves to children with severe diseases. The hospital takes care of children who are afflicted with cancer, SMA and other serious diseases. The hospital, for several years had been financially struggling to acquire the proper medicine and technology to tend to all of their patients.
Since Aventus Group has become their sponsor the organization has been able to more effectively treat their patients. Aventus Group and by extension PeerBerry in 2019 and 2020 together have invested more than 200,000 EUR into Dobrodiy. The minimum investment entry on PeerBerry is 10 EUR and the interest rate or IRR ranges from 9 to 12 percent. While the majority of loans issued on PeerBerry are consumer loans there is great multitude of loans.
Investors on PeerBerry can invest in real estate loans, auto loans, business loans and consumer loans. All of which can come with collateral though that's not a prerequisite. PeerBerry has a well functioning auto investing tool and very little cash drag.
Companies With Character
It makes a difference if a platform actively practices what it is aiming to achieve. Allocating significant amounts of resources into developing and improving the environment that surrounds these businesses reinforces not only their success and reputation but also their character.
If we understand Peer-to-Peer lending to be an investing strategy that benefits from the number of participants, then the platforms at the forefront should be encouraging financial participation wherever it's truly needed. The genius of P2P lending is truly in its ability to scale. The more people brought out of poverty the more capital available in peer-to-peer networks. The invention of micro finance has enabled us to find justifiable profit in small portfolio borrowers and investors.
Companies that are using their profits to reinvest back into their localities are not only morally praise worthy. One should be aware that these people who are receiving donations from Peer-to-Peer networks may also then become participants of the network that once promoted them. Companies like EstateGuru and PeerBerry are building on their future networks and actively giving people the help they need to reach financial stability.
Doesn't matter if it's a yearly loan for building projects,donating to hospitals or making sure people get a hot meal in the dead of winter, help is help, and a little bit of help can make a world of difference.
Status
There is no need to beat around the bush here. Donating for charity is a wonderful thing. It's great for tax write offs and it's also kind of a flex. There is a certain status or privilege with being able to donate to charity.
There is a reason not every P2P lending platform is donating to charity. Although some may not be interested, the majority most likely don't have the ability. Donating capital to charity or allocating resources to charitable causes is an indicator of surplus resources. It is a beacon of success and a message to their competitors that they have either time or money to spare.
Market Type
Mortgage Loans
Average Returns
8 - 13%
Minimum Investment
EUR 50
Signup Bonus
0.5%
Registered users
150,000
Total funds invested
EUR 700 Million
Default rate
6%
Regulating entity
Bank of Lithuania
Buyback guarantee
Secondary market
Payment methods
Bank Transfer, SEPA, Credit Card, TransferWise
Withdrawal methods
Bank Transfer, SEPA, Credit Card, TransferWise
EstateGuru is a highly recognized and successful P2P Lending company. What makes EstateGuru as P2P Lender so profitable and secure? Explore the breakdown with P2PIncome's thorough analysis of EstateGuru's strengths and weaknesses.
Market Type
Charitable Loans
Average Returns
0%
Minimum Investment
USD 50
Signup Bonus
USD 25
Registered users
40,000
Total funds invested
USD 1.68 Billion
Default rate
4%
Regulating entity
Self-Regulated/SEC Compliant
Buyback guarantee
Secondary market
Payment methods
Bank Transfer, Credit Card, Debit Card
Withdrawal methods
Bank Transfer, Credit Card, Debit Card
Kiva is a P2P lending platorm built to help low income families find a consistent cash flow to survive. Lenders take no interest on the credit they provide but have the ability to lend out the same capital to multiple borrowers.
Market Type
Consumer Loans
Average Returns
9 - 12%
Minimum Investment
EUR 10
Signup Bonus
0.5%
Registered users
70,000
Total funds invested
EUR 1.8 Billion
Default rate
7%
Regulating entity
Self-Regulated/EU Compliant
Buyback guarantee
Secondary market
Payment methods
Bank Transfer, Bank Card, TransferWise
Withdrawal methods
Bank Transfer, Bank Card, TransferWise
PeerBerry is an excellent P2P platform to its 100 percent successful fund recovery track record. They offer slightly below market interest rates in exchange for a guarantee users will never lose their funds.
Verdict
The platforms listed in this guide are all greatly responsible for the betterment of lives around the world. Whether it's by allowing their investors to grow their portfolios or by giving back to their communities and even communities abroad. Though it was hard choice, ultimately, it makes the most sense to conclude with EstateGuru as the top Peer-to-Peer lending platform on the site.
EstateGuru is not only the top grossing Peer-to-Peer lending platform listed in this guide but has also consistently donated back to their communities in the form of a percentage of their earnings. This approach is not only sensible and affordable but it also something that EstateGuru has been able to accomplish annually and will most likely continue to accomplish for the years to come.
PeerBerry and Kiva both deserve special praise for what they have been able to accomplish. Investing capital into a hospital in order to help children and trying to cure the world of poverty are causes that are too noble to simply disregard.
However, EstateGuru donating a percentage of their total earnings is far more generous. From the side of an investor, your chances of profitability with EstateGuru may also be higher than with PeerBerry and will certainly be higher than Kivas.