P2P loans increase competition with traditional banking
European countries with stable and developed economies are leading in terms of consumer and business lending. The complete digitalization of the financing process becomes one of the most important advantages of P2P loans compared to traditional banks.
Germany leads in consumer lending among other European countries due to above the average socio-economic indicators. The main reason for the popularity of such loans here is the conservatism of the banking sector, which makes it more difficult to get a quick loan. A similar situation is observed in France, where loan approval can take about a month.
Another reason for the steady growth in the popularity of the P2P lending is online access to finance. In Germany, the Internet penetration reaches 96%, which allows the majority of the population to use online services and significantly save time.
Full digitalization allows to maintain a high level of transparency in the loans issuance and the interest calculation. This is very important for the client, but it is not always feasible with traditional ways of financing. In Switzerland, for example, almost every platform claims full disclosure of information about client commissions and full reliability of services.
P2P lending platforms have softer requirements for the borrower, so it is easier for young people who do not yet have their own capital and a long credit history to get funds. Thus, P2P platforms in Switzerland offer student loans, loans for the purchase of furniture, etc.
The UK is the leader in business lending. The priority here is still the speed of service provision, reduced requirements and carrying out processes online. This is important, since the main clients of P2P lending are small and medium-sized businesses that develop innovative projects and new products. Such processes require significant funding and implementation in a short time.
“P2P platforms, as representatives of the fintech industry, normally allow to implement financing in a short time, providing transparency and customer focus. The share of repeated loans of Robocash Group, which is the parent holding of the Robo.cash platform, is 82% in average for 2021, which indicates a steady growth in demand for the product and an increase in its competitiveness with traditional financial systems.” - comment Robocash analysts.