Podcast
Questions and Answers
What does peer-to-peer lending involve?
What does peer-to-peer lending involve?
- Crowdfunding from the general public
- Direct lending between friends and family
- Borrowing exclusively from traditional banks
- Matching borrowers and lenders in a central marketplace (correct)
What determines how much the borrower will need to pay in interest in peer-to-peer lending?
What determines how much the borrower will need to pay in interest in peer-to-peer lending?
- Credit score
- Risk classification (correct)
- Loan duration
- Borrower's income
What has been a key factor contributing to the rapid growth of peer-to-peer lending?
What has been a key factor contributing to the rapid growth of peer-to-peer lending?
- Government subsidies for P2P lending platforms
- Lower risk compared to traditional banks
- Better interest rates offered than traditional banks (correct)
- Higher credit limits for borrowers
How is peer-to-peer lending perceived compared to traditional banking?
How is peer-to-peer lending perceived compared to traditional banking?
What is the main source of revenue for peer-to-peer lending platforms?
What is the main source of revenue for peer-to-peer lending platforms?
Why are peer-to-peer lending platforms heavily affected when there is no appetite for lending and risk in the market?
Why are peer-to-peer lending platforms heavily affected when there is no appetite for lending and risk in the market?
Why have the top lenders in the UK, Zopa and Funding Circle, struggled to make a profit?
Why have the top lenders in the UK, Zopa and Funding Circle, struggled to make a profit?
What does it mean when some lenders spread their investment over many different loans?
What does it mean when some lenders spread their investment over many different loans?
What would be a path to stability for P2P lending platforms according to the text?
What would be a path to stability for P2P lending platforms according to the text?
Why are provision funds set up by some P2P lending platforms?
Why are provision funds set up by some P2P lending platforms?
