9 Things To Consider To Earn Higher Returns Using P2P Lending

Aug 4, 2022

9 Things To Consider To Earn Higher Returns Using P2P Lending

In the past decade, the internet has become a catalyst for change creating many new opportunities for millions of people across the world. For instance, it is now possible to create business opportunities worldwide just sitting on a computer with an internet connection blurring the boundaries within.

P2p Lending is a recent phenomenon in the industry of finance disrupting the traditional channels of the lending industry that capitalizes on the opportunities presented by the digital economy.

P2P lending works similarly to traditional lending. But instead of working with banks as an intermediary, you work directly with borrowers who are looking to borrow some money from your investible excess. Ofcourse, you undertake a degree of risk. But, with a comprehensive credit check of borrowers in place, LendenClub is well-positioned to mitigate such risk and generate good returns from your investments.

If you’re one of those people seeking a solid investment opportunity, you’ve probably heard about P2P lending India. But to succeed as a P2P lender and earn fantastic returns, you must bear the following in mind:

Start Small, Build Big

Big profits are only theoretically attainable if you don’t burn your hands on the way. Depending on your risk tolerance, start with baby steps by investing a small amount that you can keep aside without affecting your finances. Let your investor portfolio expand naturally and steadily.


One important lesson for investors is that they should not put all their eggs in one basket. It’s advisable to divide the investment into different blocks and place each block in an investment plan with a different lock-in period. While the money invested in a five-year plan gives better compounded returns, the one-year plan ensures investors’ liquidity.

This diversification will help you reduce your overall risk as the chances of every borrower defaulting is close to zero.

Hope for the Best, Prepare for the Worst

P2P lending delivers handsome returns. But investors must also be wary about the risk of default. After all, it deals with other human beings as borrowers and investors should always factor in that risk. However, LenDenClub’s detailed research on borrower profiles minimizes the default risk by ensuring borrowers’ credibility. The platform AI-based system also minimizes the risk for investors by spreading the risk to a large number of borrowers.

Risk Averaging

The portal would already include profiles of the borrowers that are listed there. Before determining the loan amount, tenure, and interest rate for each loan, LenDenClub’s underwriting algorithm conducts a thorough credit assessment and verification process. Staying invested for a longer period not only increases investors’ returns but also averages out their risk as their investment gets disbursed to more number of borrowers.

Information is Wisdom

The majority of lenders join the P2P trend in anticipation of large profits. But keep in mind that great rewards are usually accompanied by risk. Your P2P lending platform should also provide you with a seamless flow of information that supports your decision-making process. As a leading P2P lending platform, LenDenClub provides detailed and easy-to-use borrower profile analysis. This is further supported by our AI-based lending mechanism which matches your risk profile to the right pool of borrowers and ensures that your investments work for you!

Think Compounding

With LenDenClub’s P2P lending platform, you can benefit from the compounding effect as your money never sits idle. Even for a minute! You can choose a time-frame for your investments for up to 5 years and that’s how long your money stays invested. This ensures that you come out with higher than returns on your investments with compounded returns.

Lend According to Your Risk Appetite

Every person has a different level of risk appetite. With high risk comes high returns but you also need to understand that an unusual amount of high risk leads to losses. P2P as an alternative investment asset class has the ability to generate above-average market returns but patience is the key. It’s always good to earn 12% every year where the chances of losing your money are quite low when compared to a return of 36% where losing your money is inevitable. Always remember that 36% is just a number on the paper. It’s not true until you’ve received it!

Tax Compliance

A trustworthy P2P lender will guarantee adherence to the law of the land. According to the individual’s taxes law, the interest component of EMIs (monthly repayments) collected from the borrowers is taxable. Therefore, this income must be reported as income from other sources per Section 80(C). Lenders are in charge of making sure that P2P lending-related income taxes are paid on schedule.


P2P platforms like LenDenClub currently provide the discriminating investor with various alternatives, including several plans with different tenures and payout options. About their investment goals, these enable lenders to find a match in terms of returns and liquidity.

The borrower and the lender have access to low-cost, quick loans through simple online, contactless methods that guarantee seamless income creation.

As a result, P2P lending is quickly becoming the best investment possibility available.

Allowing consumers to invest without being concerned about the market risk associated with traditional investing options.

On top of that, online marketplaces like LenDenClub further simplify the process for investors. Let us see how –

  • A family of more than 2 million people
  • AI-powered Auto investment
  • Allows diversification and reduces risk
  • Screens borrower’s profile through 200+ data points to reduce the risk of default.
  • Provides returns up to 10-12% p.a*.
  • Market-risk free returns
  • Safe and Secure transactions using the ESCROW mechanism.

Hop on the bandwagon with 2 million+ investors. Register now!

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