Want to be a bank, but without the teller window and vault? Peer-to-peer (P2P) lending lets you lend money directly to individuals or small businesses through online platforms, earning interest on your loans. Think of it as becoming a mini-bank, lending to people instead of corporations (and potentially earning bank-like returns).
P2P lending platforms like LendingClub and Prosper connect borrowers and lenders. You choose borrowers based on risk profiles and loan grades. Diversification is key – spread your lending across multiple loans to mitigate risk. Returns can be higher than traditional savings accounts, but P2P lending involves default risk (borrowers might not repay).
Do your research on platforms and borrower risk. P2P lending: Be the bank, earn interest, help people (or small businesses) get loans. Lend money, make money (potentially!).