In the present investing world, where accessibility, convenience, and tailored solutions are at the forefront, investors have turned to alternative lending. The global alternative lending platform market is estimated to reach $30.15 billion by 2033 with a 24.1% CAGR. Approximately 40% of retail customers believe a non-banking institution will provide better investment services.
The sudden yet anticipated increase in alternative lending has given rise to some promising and innovative investment instruments. The choice between these offerings has become complex as investors look for options beyond traditional investments.
We will discuss about two of the options in this space: peer-to-peer (P2P) lending and LoanX. So, what should you choose between the two? Read the article to determine the most-suited alternative lending option per your investment goals and risk profile.
Alternative lending refers to the range of loan options for consumers and business owners outside conventional bank loans. Simply put, it means borrowing loans from non-banking financial institutions without a full banking license.
Below are reasons for the rising demand for alternative lending solutions:
Peer-to-peer lending or Marketplace Lending is among the most popular alternative lending solutions. It uses an online platform to match investors with borrowers. In essence, P2P lending refers to direct money lending to businesses or individuals without an intermediary.
Peer-to-peer lending offers several compelling advantages for lenders and borrowers. Besides the streamlined process, the following benefits make it an attractive alternative to traditional financing methods:
Nothing comes without limitations, and P2P lending is no exception. Some notable downsides to engaging with the market include
LoanX is an investment-grade solution for a streamlined approach to gaining fixed income from short-term investments. It is a regulated and NSE/BSE-listed instrument and allows you to tap into unexplored investment opportunities. LoanX introduces a robust framework to secure your investment interest.
Although new to the market, LoanX is distinctly positioned to offer a range of benefits. It ensures every investor can access favourable investment opportunities to curate diversified and healthy portfolios. The primary perks of LoanX investment are as follows:
LoanX is a structured investment solution that harbours a compliant framework. However, it is not immune to inherent risks with any investment. The potential drawbacks include:
Selecting between P2P lending and LoanX can be challenging due to their unique advantages. Here are the factors you must consider for the ideal option
Here is a tabular comparison between P2P lending and LoanX to help you make an informed choice.
Ultimately, the right choice depends on your financial goals, risk tolerance, and preferences. It is wise to conduct thorough research and start with a minimum investment to test the waters before committing significant funds.
The versatile peer-to-peer lending allows you to diversify your portfolios across various loan types and enhances risk management. However, the actual returns can be uncertain and unreliable. Meanwhile, LoanX provides compliance and grants exposure to a diversified pool. The additional security measures enhance investor confidence.
Grip offers an easy-to-use platform to participate in alternative investments. It presents various solutions and products to help you meet your financial goals. Explore Grip Invest to begin your journey today and explore LoanX as an alternative investment option.
Want to stay at the top of your finances?
Join the community of 2.5 lakh+ investors and learn more about Grip, the latest financial knick-knacks and shenanigans that take place in the world of investing.
Disclaimer - Investments in debt securities are subject to risks. Read all the offer-related documents carefully. The investor is requested to take into consideration all the risk factors before the commencement of trading. This communication is prepared by Grip Broking Private Limited (bearing SEBI Registration No. INZ000312836 and NSE ID 90319) and/or its affiliate/ group company(ies) (together referred to as “Grip”) and the contents of this disclaimer are applicable to this document and any and all written or oral communication(s) made by Grip or its directors, employees, associates, representatives and agents. This communication does not constitute advice relating to investing or otherwise dealing in securities and is not an offer or solicitation for the purchase or sale of any securities. Grip does not guarantee or assure any return on investments and accepts no liability for the consequences of any actions taken based on the information provided. For more details, please visit https://www.gripinvest.in/.
Registered Address - 106, II F, New Asiatic Building, H Block, Connaught Place, New Delhi 110001.