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Peer to Peer Lending: The Basics

Peer to Peer Lending

You may have heard of peer to peer lending but what is it?

Peer to peer lending involves lending money directly to people and businesses who need it cutting out the banks and passing more of the profits to the people who’s money is being used. Peer to peer lending also appeals to investors as the interest rates are typically much higher than the abysmal rates offered by banks on savings at the moment.

How does P2P Lending work?

Peer to peer lending is really simple platforms match together people who require money with people who have money to invest. As an investor you can choose which platforms you use which offer a range of different levels of flexibility around which opportunities the money you invest is used to fund.

Who am I lending money to?

When you invest money in peer to peer platforms some allow you to choose specifically who you lend money to you. Most platforms lend to businesses but there are some that lend to individuals. A lot of platforms also do credit checks on the businesses and individuals that they lend to.

Why I Love Peer-to-Peer Lending. The Best Alternative For Beginner… | by  Chris Tsounis | Medium

Is it safe?

As with all investments there is always a risk of losing your capital but peer to peer lending has a good track record, always check the individual platforms you are using to see there statistics. I also recommend only using platforms that are FCA approved or the equivalent in your country. Lots of the peer to peer sites also secure the loans they are making against assets to reduce the exposure. All investments come with their own risks make sure you know the risks and safeguards that are in place before investing any money.

How do I get started?

If you like the sounds of peer to peer lending and want to give it a try you can get started today. All you need is the money you are willing to invest and you can get started.

Some of the peer to peer websites I recommend and use personally are:

Funding Secure

Funding secure have a reliable track record and also allow you to choose which investments you invest your money in and how much you invest in each one. Their site is very clear and easy to use and they send you emails to let you know when new opportunities are available. They also offer an IFISA so you can make your investments tax efficient. Funding Secure also offer interest rates of over 10% on most of their opertunities which makes it very appealing.

You can also look at their statistics to see what their books look like.

If you sign up using my link and invest over £1000 you will get £25.

Lending Crowd

Lending Crowd also have a good track record. They also allow you the choice between an auto investment account where you just put your money in and they automatically spread it across a range of opportunities for you and ensure that there your money is well diversified, which is important when making any investment.

If you sign up using my link you will get £50 if you invest £2000 or more, terms and conditions can be found on Lending Crowds website.

Covid-19: support and information for businesses - LendingCrowd


Kuflink are a relatively new peer to peer platform, what makes them appealing is that they invest up to 20% of their own money in each investment opportunity, this makes the investments much safer and also increases investor confidence in the opportunities.

If you sign up using my link and invest £500 or more you will receive £100 which is an instant 20% return on your investment! Terms and conditions can be found on Kuflink’s website.

Other Platforms

There are also many other platforms available so if none of the above ones appeal to you then I would recommend searching the web and checking out some others.

When investing I would always recommend that you do your research and check out exactly who you are giving your money to and what they will do with it to check its safe.


Diversification is always important when making peer to peer loans its always a good idea to spread your money across a range of different platforms and different opportunities within those platforms.

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