ILEND

The bulk of the lenders filling up the rosters of prominent P2P platforms are return-hungry retail investors and traders with surplus cash flows. Low fixed-income returns prompting these high net worth individuals and family offices are writing larg...

RBI identifies peer-to-peer lending startups as a special category of non-banking fin companies

i-Lend has partnered with credit risk assessment and verification company Lenddo which uses social and non-traditional data for credit scoring. Singapore-based Lenddo.

Mohandas Pai, who has backed Faircent, said the RBI's regulatory guidelines will bring clarity, which will attract more players and intensify competition.

ET recently reported that P2P startups had decided to form an association with an intention of self-regulation. The association expects to complete their registration process by January and will be headquartered in Mumbai.

They fear that these issues could eventually drive potential investors out of this segment as well.

From established players like Faircent to early-stage companies like IndiamoneyMart, PaisaDukaan and OMLP2P, all are trying to develop the industry’s first blockchain platform.

Recognition of peer-to-peer lending startups, revised guidelines for digital wallets & finalising charges for epayments can help fintech sector grow organically in the next two years

An NBFC-P2P shall not lend on its own and not provide any credit enhancement or credit guarantee.

The Hyderabad-based company recently started operations in Bengaluru and plans to expand to a few more cities in the coming months. It is also looking to raise Series-A funds later this year.

The startup, which was launched earlier this year, will act as a marketplace to connect institutions that need to lend, which companies or individuals who want to borrow.

The online marketplace connects borrowers who are in need of money to lenders who are ready to invest for higher returns.

Banks and NBFCs are looking to lend via alternative lending platforms following the government's push for digital transactions which is incentivising online lending.

Trusteeship services tend to be very expensive and push up lending costs for borrowers, killing the growth prospects for this sector, say industry insiders.

P2P companies are in the process of forming an association with an aim to create a fair practice code within the industry players and grapple with ethical issues together.

While some have already started offering insurance products, most of them are waiting for the RBI to issues guidelines.

"Besides capital infusion into the platform, these partnerships will enable select institutional lenders to gain access to a largely underserved market."

Many industry observers expect the central bank to legalise a contractual system that integrates blockchain technology as a platform by the end of the financial year.

The RBI's move to regulate the peer-to-peer (P2P) lending business has evoked good response with most participants saying that it could provide greater confidence to lenders and borrowers, as also to venture capitalists.