Peer to peer lending
Peer to peer lending is simply stated as the money from the financier is given to the borrower (A single person or company) for certain interest in returns. To order to minimize the market risk, experts prefer to make this trade with partners in the business investment. Let us take an example, a group of 5 people contributing an equal share in the loan amount of 5 million with an interest of 2% per month will get everybody 20,000 every month. Considering the investment of 1 million, there is a yearly return of 10.2%.This type of trading with lower risk factors and comparatively higher returns is a considerable investment for new investors. As an outcome, the borrower will also be benefited from lower interest rates when compared with the leading banking and finance companies. Here there is a mutual growth policy between the borrower and the investor. In this method, the money invested will be multiplied in a short span, thus can be used for investing in investments with the lower risk factor. Leading investors are mainly focusing on the stocks of a company, but on the comparison, the risk factor here is still low. With proper documentation and legal procedures, a valuable asset is pledged for financial security, Which will give you a stronger hold on your money.
Note: Everything stated above should be done only after consulting a legal adviser and should be properly verified by the investor.
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