Is P2P Lending Really Safe?

Is P2P Lending Really Safe? || bekifaayati #youtubepartner #youtubeshorts #shorts

The risk involved with peer-to-peer lending is the risk of default by the borrower, i.e., the borrower doesn't pay the interest and the principal amount. If a borrower defaults, a P2P platform can assist the lenders in recovery and file legal notice against the defaulter. But that is all the platform can do.

With P2P lending - Unfortunately, as investors, you are entirely at the mercy of the P2P lending platform’s evaluation. So if the platform’s risk-scoring model is not great and it cannot correctly gauge the risk levels of the borrower, you end up taking far higher risk than you might want to.