With several headlines going on in the P2P lending world, from China’s peer-to-peer Ponzi scheme (Ezubao) who collected $7.6 billion USD from 900,000 people, to LendingClub where some of their employees falsified data on certain loans sold to an investment bank, forcing the CEO to step down. This understandably raises public eyebrows on the future of P2P lending / crowdfunding marketplace and is an opportunity to pause for thought and think about how the P2P industry might evolve over the coming years.

So what does this all mean to everyone?

P2P lenders are already making its way around the globe, changing the way businesses access finance and at the same time providing savvy investors access to new asset classes.  These platforms offer faster, simpler and more flexible finance to borrowers.  More and more borrowers are moving towards P2P marketplaces to access funding.  Investors are also getting savvier in diversifying their investments.

However, P2P lenders are sometimes expected to grow quickly, especially those who are backed by venture investors. There needs to be a more balanced approach between growth and risk. Better control and transparency are required to minimise wrong behaviour.

Having said that, it is very unlikely that the events of the past few weeks will put an end to the P2P marketplace – one step back would not revert the entire innovation.

Sustainable approach – P2P crowdfunding

We believe transparency is key, by providing relevant and complete information, allowing our investors to analyse data and conduct assessments prior to making investment decisions.  We also aim to have a good balance between different type of investors (from retail, high net worth individuals and family offices) and encouraging our investors to diversify their portfolio.

At InvoiceInterchange, we believe in quality investments over quantity.  Our highest priority is to protect our investors’ hard earned money, and not be pressured by high growth expectations that sometimes come with being in the Fintech industry.  P2P platforms must develop strong risk management discipline to protect against the likes of loss rates and fraud.

We continuously focus on originating quality investments as well as invest in technology and operations to better serve our customers.