The 5 advantages – not always so evident – of online consumer credit

Everyone is talking about FinTech in a continuous and pervasive way. Often not in the right way: some myths to dispel and factors that are still not entirely clear, especially in P2P lending dedicated to people, resist. We tried to list the five advantages of the sector, from the point of view of the applicant and the real economy. Here they are.

 

Speed

credit Speed

One of the major strengths of P2P lending is the time that saves. In traditional consumer credit, it can take up to a week from the moment in which the bank receives all the required documentation to that in which the desired amount arrives on the current account (with overall times that can in some cases reach up to 3 or 4 weeks.). Online, the answer on the outcome of the question is practically in real time: once the data has been entered on the platform, the feasibility of the request is verified (in essence it is verified that there are no protests or delays). When the platform receives the ok, the customer can send the complete documentation as requested: from the moment of correct reception of the same, the platform takes 48 hours to carry out the preliminary investigation and to transfer the money to the account. of the customer.

 

Digital and flexible experience

credit debt

All the procedure takes place online, without the mediation of consultants and without the need to go to the counter. This results in further savings of time and kilometers of ground to go to a physical location on several occasions. The digital nature of the experience guarantees flexibility. It is the customer who decides times and ways of interaction and, while not physically interfacing with a consultant, can enjoy telephone assistance always available and personalized.

 

Disintermediation

Disintermediation

P2P lending is the market where the two sides of the loan relationship meet. On the one hand, the applicant, who needs funding for different purposes – from buying a car, to renovating a home, to financing a holiday or a study period abroad, just to give some examples. On the other, the lender who agrees to lend to a diversified basket of borrowers and signs a contract detailing the timing and methods of returning the capital.

 

Competitive interest rates

interest rates

We immediately clear the field of a false belief: that P2P lending applies high interest rates in exchange for the advantages described above in terms of speed and convenience of use. The rates applied depend on two characteristics: the customer’s risk profile (for example in the Sparkborrow Financing classification there are three) and the match between supply and demand (the lender can request to receive a given rate and wait for the market to appear someone willing to pay him). For these reasons, interest rates vary over time: in the last four months, the TANs registered on the Sparkborrow Financing platform have moved between 2.41% and 5.16%. In the lower part of the range it is a very competitive value compared to the rates applied by traditional operators.

 

The ethics of P2P lending between people

The ethics of P2P lending between people

True, everything happens online through the Sparkborrow Financing platform. But this must not make us lose sight of the focus of P2P lending between people: that is, people. At the center of FinTech there is always man and this is why it works. Without considering that this market segment contains in itself a strong ethical content: investor side because they finance the dreams and projects of other people; on the applicant’s side because a gap in the supply of credit is facilitated which facilitate domestic consumption, that is, it supports the demand for products that contributes to GDP growth. Somehow it feeds the real economy in a joint effort that involves, we like to repeat it once again, the people.

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