Taking loan is pain in ass. While banks have decreased the norms to take loans it is still not reachable to the masses yet. The unemployed, the students and those with no collateral still have problems in taking a loan. In the recent years there has been a rise in the number of FinTech startup in the country. FinTech is surely gonna change the whole lending system.
Faircent a peer-to-peer lending platform has raised $1.5 million funding from BCCL. Started in 2014 the startup has more than 30,000 lenders and borrowers combined. Peer-to-peer lending is loan from unlisted entities but with taking this online it has become more transparent. The main problem is the higher interest rate people have to pay to those private lenders. In P2P lending common people like us comes in to give loans to the ones in need. Every platform has its own set of rules for borrowing and lending. You can register yourself as a borrower or as a lender.
After full verification of the documents the platforms accept the person. We have seen a rise in these platforms as in 2015 the number was 20 and now it is about 30 in 2016. How useful this thing is can be guessed by the fact that china has more than 2000 P2P platforms.
Faircent has recently raised an undisclosed amount of funding in Series A. While with the recent funds raised they want to bring more and more people on board their platform. They have currently disbursed loan about Rs.6.5 crore.
RBI has also categorised these P2P in NBFC. P2P is a good way of investment for those with plenty and a good and easy way to borrow for those in need.