Loans between private individuals, also known as social lending, originated in Great Britain in 2005.
It is a special method of personal loans where the traditional intermediation of credit or financial institutions is no longer valid. In fact, the loans are made exclusively between individuals through a special online platform managed by companies authorized by the Bank of Italy. sauvonslesrased.org has examples
The novelty introduced by this system is therefore the absence of intermediation between the loan applicant and the lender who makes available their money as an investment. But let’s see in detail how these personal loans work.
A private individual who decides to approach this type of loan does so because he may have been refused a request from his bank or because he has assessed a rate condition better than the classic personal loans .
In fact, the loans between individuals have the peculiarity that to every applicant of a loan the company that manages the platform assigns a reliability assessment by crossing the information of the various credit databases. The interest rate applied to the loan will depend on the rating of the applicant.
A reliable user who has never had any payment delays will be offered a contract with a very advantageous rate. On the other hand, if an applicant is deemed unreliable for his credit history, he will be assigned a low credit rating. And this will probably result in a higher rate.
To request loans between individuals, you must register on the website of the selected company, indicate the amount and the desired repayment duration and send the required documentation. Each company has different requirements both in terms of maximum disbursement (up to € 25,000 can be reached) and in terms of duration.
Once the loan application has been made, a quick but scrupulous analysis will be made of the applicant’s situation which, once deemed suitable on the basis of his credit history, will be submitted to the marketplace where the lenders will decide whether to accept the investment. and proceed with delivery.
All this takes place in very short time, often even within 24 hours .
Where does the lent money come from? From other individuals who decide to invest their savings in this new form of investment often more profitable than others.
The lender has the possibility of obtaining excellent returns and being able to manage his own money independently, deciding whether to opt for a more or less risky investment on which the type of return will depend. The possibility of diversifying the amounts allows to reduce the risks considerably. For example, if we decide to invest € 1000, this money will not be lent to one person but will be divided into shares of different loans.
Summing up we can say that the advantages are multiple. For example the speed of response and minimum delivery times, the rates benefit greatly. Or greater evaluation flexibility and absence of penalties in case of early extinction. For those who “lend” excellent returns and diversification of investment that reduces risks.