If someone wants to invest in peer to peer lending platform, then he must accept few risks associated with his investments. A Peer-to-Peer lending player cannot offer 100% guarantee to his principal, as it is impossible to do mathematically. If a Peer to Peer lending marketplace does offer you 100%, then you must ask collateral or fixed deposit that backs 100% principal guarantee. Having said that, we at LoanMeet ( www.loanmeet.com ) had zero defaults so far.
We at LoanMeet did face few payment delays due to job loss, and other reasons. The bigger question is why does an individual delays his EMI payments. We can put defaulters in three categories – intentional defaulters, defaulters who want to check if they can delay, and defaulters who do not have funds to make EMI payments. Our LoanMeet algorithms eliminates most of the intentional defaulters. When we noticed high risk with a borrower, we either declined the loan application, or gave a short-term loan of six months to the borrower.
There are a number of individuals who delayed EMI payments, and see what the consequences of payment delays are. It is critical to inform these individuals about consequences right away. If you are soft on them, then they would always delay payments. That’s why one must be vigilant about these individuals. If an individual does not have funds, then one must be careful in dealing with them. If you press them too much, then they would resign from making EMI Payments, and ask you to do whatever you can. To manage them, you need to work closely with them, and work on an alternative plan.
Out of more than 100 borrowers to whom we have given loans, we faced below payment delays of ten or more days.
|1||Reena||60 Days||Lost Job for Two Months|
|2||Gopal Krishna||20 Days||Excuses|
Reena lost her job, and she could not make EMI payments for the period of the two months. After two months, she started working as freelancer, and then she made EMI payments. Gopal Krishna always has a new excuse for payment delays. On few occasions, he said that his bank account is not working, or he was out of town. Since he stopped taking calls from our office number, so we started calling to his office landline. Abdul is also quite innovative with his excuses. He always tells us that he would make the payment today. Ishank told us that his friend would make the payment. Varun had multiple loans, and it seems that he was in financial distress. He made the entire principal payment in one shot. Please note that these were temporary payment delays, and everyone is back on track with the EMI payments.
Below are the steps to become a lender at LoanMeet.
- Open your web browser on your laptop or mobile phone
- Enter loanmeet.com
- Click “Invest” at the top
- Fill your basic details and start earning 20% or more on your investments
- Please reach out to firstname.lastname@example.org or 7259355400 for questions or concerns
The payment delays and defaults are always part of banking systems, but the trick is what would you do in those situations. We reach out to borrowers whenever there is a payment delay. In most cases, we reach out to them on a daily basis. If the person does not pick our calls, then we use different phones to make calls. Due to the above payment delays, we lost few lenders. The lenders who gave loans to Reena and Varun have stopped lending on our platform. If a lender does not have risk appetite for payment delays, then we suggest him to not invest in peer to peer lending. We aim to bring good credit worthy borrowers to our platform, provide high returns to our investors, and follow up with borrowers in case of payment delays.