The peer-to-peer (P2P) lending world comprises three major elements: The lender, the borrower, and the platform. Based on the concept of crowdfunding, a P2P platform makes it convenient for people to find borrowers interested in taking unsecured loans.

 After online deliberations, P2P companies undertake rigorous verification of the borrower at his residence as well as workplace.

If he is a good borrower, then we can forward his or her loan request to lenders within an hour or less. But If he (the borrower) is in a remote place, it may take up to 24 hours due to the verification process. 

Unlike banks, P2P platforms do not mainly depend on pay slips and KYC forms for loan issuance. Self-employed individuals can also avail of unsecured loans on the platform, provided they fulfill the eligibility criteria.

Social Media Footprints

Online lending companies may also refer to unconventional sources like X, Facebook, and e-commerce sites to assess a borrower’s creditworthiness. This means, that if you have checked for credit card offers and personal loans too often, it may not leave a great impression with these data-driven lending firms.

 Risk Categorization

People with credit scores below 7 are highly unlikely to get a bank loan. But P2P companies divide borrowers into different categories; namely very high risk, high risk, medium risk, low risk, and very low risk. Depending on an individual’s financial history, income, and repaying capacity- the borrower is given a rating by the concerned platform.

Borrowers with very high-risk profiles have a higher income-to-debt ratio. Therefore, a high probability of paying back but the volatility could be on the higher side. Such borrowers are more likely to be ignored by banks and financial institutions. Similarly, very low-risk or minimum-risk profiles offer the lowest rate of return for the lenders and maybe every bank’s delight.

 No Blacklists in P2P

Banks generally have a specific list of areas and profiles which they do not entertain. P2P companies look at every borrower as an individual and try to offer customized loans as per his or her requirements.

But this doesn’t mean that anybody can get a loan on a P2P platform. Despite the flexibility, the KYC norms and credit assessment algorithm are always in place. For example, we may get about roughly 40 applications out of which only 15 get to be listed and approved.

Are you in need of a personal emergency or business loan in Kenya? Worry not because kenfasp2p has made it easy for individuals to access credit through our various lenders registered on the platform. Contact us today to learn more!