Pune, Aug. 27, 2024 (GLOBE NEWSWIRE) -- Peer-to-Peer Lending Market Size Analysis:
“The SNS Insider report the Peer-to-Peer Lending Market was valued at 5.94 bn in 2023 and is anticipated to reach USD 30.54 billion by, growing an annual growth rate (CAGR) of 20% over the forecast period of 2024-2032”
Market analysis
The peer-to-peer (P2) lending market is booming as individuals and small businesses turn to these types of funding sources instead of traditional banks. Traditional banks typically have high standards, meaning it can be tough for people with poor credit scores or those starting a business to qualify for loans. P2P lending platforms solve this by providing access to more available and flexible funding options. With the help of online platforms and digital infrastructure, lenders can communicate directly with borrowers without any intermediates handling credit assessment on their behalf. Credit scoring and fraud detection too have paved the way with machine learning, AI, enabling faster lending decisions to better risk management. Moreover, returns on P2P platforms are lucrative for investors as they generally earn 5 to 7% annually. A 2024 survey found that faster loan approval times were the primary driver for 70% consumers would choose P2P lending over traditional banks, while 65% people also saw being able to adjust their loans amounts and repayment terms.
The emergence of fintech companies and their integration in BFSI sector foster the growth of this market. Greater transparency is also being encouraged by regulatory changes, such as the European Union's new disclosure requirements on P2P platforms. However, inconsistent regulations across regions present challenges that need addressing to sustain growth and ensure market stability. The P2P lending industry continues to thrive because of technological advancements, growing demand for alternative finance and an evolving regulatory landscape. According to a 2023 survey, nearly 60% of small business owners used alternative financing (including P2P lending) because difficulties in obtaining loans from traditional banks.
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Major Players Analysis Listed in this Report are:
- Avant, LLC.
- Funding Circle
- Kabbage Inc.
- Lending Club Corporation
- LendingTree, LLC
- OnDeck
- Prosper Funding LLC
- RateSetter
- Social Finance, Inc
- Zopa Bank Limited.
Peer-to-Peer Lending Market Report Scope:
| Report Attributes | Details |
| Market Size in 2023 | USD 5.94 Bn |
| Market Size by 2032 | USD 30.54 Bn |
| CAGR | CAGR of 20% From 2024 to 2032 |
| Base Year | 2023 |
| Forecast Period | 2024-2032 |
| Historical Data | 2020-2022 |
| Key Regional Coverage | North America (US, Canada, Mexico), Europe (Eastern Europe [Poland, Romania, Hungary, Turkey, Rest of Eastern Europe] Western Europe] Germany, France, UK, Italy, Spain, Netherlands, Switzerland, Austria, Rest of Western Europe]), Asia Pacific (China, India, Japan, South Korea, Vietnam, Singapore, Australia, Rest of Asia Pacific), Middle East & Africa (Middle East [UAE, Egypt, Saudi Arabia, Qatar, Rest of Middle East], Africa [Nigeria, South Africa, Rest of Africa], Latin America (Brazil, Argentina, Colombia, Rest of Latin America) |
| Key Growth Drivers | • Growing need for alternative financing options, especially for individuals and small businesses that find it challenging to secure loans from traditional banks. • Innovations in digital platforms, advanced algorithms, and data analytics streamline the lending process, making P2P lending more efficient and accessible. |
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Recent Developments
- Jar (Tiger Global) & Non-banking Financial Company LenDenClub launched "a P2P lending venture named Jar Plus" in partnership with, March 2024 Jar is currently being alpha tested with a small number of users and feedback will be used to drive further changes before the platform goes live.
- In August of 2023, Avant Inc. is revealed to be working on a grid-native supercomputer While expected to rapidly transform the AI software and big data processing markets, this innovation benefits applications including scientific simulations and climate modeling.
- In the U.S., almost 40% of peer-to-peer (P2P) lending platforms employ artificial intelligence / machine learning for credit scoring and risk management.
Segment Analysis
On the basis of type, consumer lending segment dominated the market with revenue share more than 58% in 2023. P2P lending platforms can provide borrowers with significantly lower interest rates as compared to traditional banks because it operates on low fixed overhead cost. The automated underwriting process of these platforms further cuts lending costs a benefit to borrowers in the hunt for lower interest rates. The business lending segment is expected to grow with the highest CAGR at a rate of 21.8% throughout the forecast period. Unlike bank loans, which could take a couple of months for approval and include various procedural approvals that are to be complied with P2P lending gets the lenders their required amount in less than 72 hours. Startups and small businesses particularly like this segment as they can keep topped up on capital with little paperwork.
Based on end user In 2023, the non-business loans segment led the P2P lending market and accounted for over 73% of total revenue share. The main reason for such dominance is the rapid consumer adoption of personal loans among those in need of convenient and financially suitable access to credit. P2p lending platforms address this demand by offering a quick and concise loan initiation process along with competitive borrowing rates.
Peer-to-Peer Lending Market Key Segmentation:
By Type
- Consumer Lending
- Business Lending
By Loan Type
- Secured
- Unsecured
By Purpose Type
- Repaying Bank Debt
- Family Celebration
- Credit Card Recycling
- Buying Car
- Education
- Home Renovation
- Others
By End-user
- Non Business Loans
- Business Loans
Regional analysis
North America led the P2P lending market and with more than 33% revenue share. The dominance of the region is attributable to high fintech innovation adoption and its strong financial infrastructure. P2P lending platforms have grown in importance, especially in the US as technology has improved and alternative financing options become more popular.
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Key Takeaways
- Technological Advancements and Growing Demand for Alternative Financing to Drive the Peer-to-peer Lending Market
- With notable technological innovation such as AI and machine learning that bring added improvements to credit risk assessment, streamlining of lending processes.
- Regulatory developments, such as increased disclosure requirements in the European Union, are building legal and investor safeguards within P2P lending.
- The Business Lending Segment is Expected to Witness the Highest Growth as Compared To The Consumer Lending Segment. Non-business loans account for a substantial share of the market, as well.
Table of Contents – Major Key Points
1. Introduction
2. Executive Summary
3. Research Methodology
4. Market Dynamics Impact Analysis
5. Statistical Insights and Trends Reporting
6. Competitive Landscape
7. Peer to peer lending Market Segmentation, by Type
8. Peer to peer lending Market Segmentation, by Loan Type
9. Peer to peer lending Market Segmentation, by Purpose Type
10. Peer to peer lending Market Segmentation, by end user
11. Regional Analysis
12. Company Profiles
13. Use Cases and Best Practices
14. Conclusion
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