SnoozyWaffle

P2P Lending firms self regulating to stop instant withdrawals from 1-Apr

https://m.economictimes.com/tech/startups/p2p-lenders-to-stop-liquid-funds-as-rbi-peers-into-business/articleshow/108686922.cms

https://twitter.com/ravihanda/status/1771021456287088858

9mo ago

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CosmicQuokka

Paralleldots9mo

So what they'll do, next day withdrawal?

SnoozyWaffle

Stealth9mo

P2P Lending works like this.

InvestorA invests money.
That money will be lent to multiple people (to avoid concentration risk) by P2P Lending platform.
BorrowerA pays back as EMI or full amount
Investor gets only their share of money with interest that was lent to BorrowerA.

If the borrower doesn't pay the investor will not get money.

i2iFunding is one of the initial companies that started P2P Lending and they still operate correctly. I

These VC funded companies like Liquiloans changed that by saying that return is guaranteed which is not the case. This might be become a Ponzi scheme when borrowers doesn't pay back.

SnoozyWaffle

Stealth9mo

the platforms can't allow anytime withdrawal

WobblyJellybean

Bain & Company9mo

P2P lending platforms like CRED mint and Mobikwik Xtra? Unregulated, vicious cash traps. RBI sambhalo, please! Now, aren't you concerned about your investment risks?

GoofyHamster

Swiggy9mo

Doesn't this affect the investors rather and actually benefit the lending platforms? Or maybe I'm misunderstanding how stopping instant withdrawals equals to self-regulation?

SnoozyWaffle

Stealth9mo

Ideally P2P lending platforms should not offer anytime withdrawal option. But, most of them offer. RBI commented recently that such practices are incorrect. So, these platforms seem to be self regulating to avoid any regulatory interference.

So, If any investor parked their liquid money here, they should reconsider it now.