Category: P2P Lending | Page 6

🔥 Mintos Review 2024 – My Results in 6 Years and Over €150,000 Invested

Last updated: November 26, 202495 Comments

Mintos is a peer-to-peer lending platform in Europe. Like many other FinTech companies of this type, it is based in the Baltic region; in Latvia specifically.

Currently, Mintos has four offices employing more than 160 people in Riga, Vilnius, Berlin and Warsaw.

Mintos started operating in 2015 but has experienced rapid growth due to getting many things right and becoming popular with financial bloggers due to its ease of use and transparency.

The average interest rate is around 12%, with close to 500,000+ investors registered worldwide and 600m euros under administration.

Another important statistic to look at is the loan book growth, and here again, Mintos is doing very well as can be seen in the following screenshot.

The total money invested so far is higher than 8 billion Euros, which is a staggering number for such a young platform. There is no doubt that Mintos is the biggest player in P2P lending in Europe at the moment, with over 50% market share of the total p2p lending market. There are some good competitors, but none of them provide the security and track record that Mintos does.

The management team of Mintos is clearly displayed on the website with links to the Linkedin profiles of each person on the team. Mintos is currently the biggest employer in the P2P lending space.

Being able to view the team and also check out various YouTube videos with their CEO Martins Sulte enhances the feeling of transparency and peace of mind. I am one of those who take a look at these pages on a website and use them when judging whether I should invest on a platform or not. Everything counts.

I have personally interviewed Martins on my podcast Mastermind.fm, so be sure to check out that episode if you like podcasts.

Mintos is a platform that is in line with EU law, so when you invest you won’t have any trouble with your accountant or tax authorities back home in terms of explaining what you are doing.

Finally and very importantly, Mintos as a company is profitable, so they are not only running on investor money but are actually turning a profit, which means that they have a much higher chance of standing the test of time compared to some other competitors that are still in startup mode.

The biggest number of investors come from Germany, Spain and the Czech Republic respectively, but this is mostly a reflection of those countries’ familiarity with this type of investing. There are more than 340,000 investors that have used Mintos and they come from 90+ countries.

More than 60 lending companies offer their loans on the Mintos platform, with over 25,000 people working at these companies and spread over 33 countries, so you can have a global reach when investing on Mintos.

The company supports 10 languages via its multilingual support team, while the website is available in 6 languages and there are loans available in 10 currencies.

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💥 Lending Platform Lendy Goes Bust – Lessons Learnt

Last updated: March 15, 20223 Comments

In May 2019, UK lending platform Lendy (previously known as SavingStream) went into administration following an announcement by the FCA.

This didn’t come as much of a surprise to many investors on this platform since things had been going downhill for some time. However, it’s always a sad moment when a platform you’ve invested money in goes out of business, possibly taking with it your money.

It’s also a moment to learn some lessons that will serve us well for future investments.

How did Lendy Work?

Lendy was a platform where property developers could apply for and obtain bridging and development loans. Most of these loans returned 1% per month and Lendy sometimes paid bonuses on loans that were overdue or simply defaulted. The loans were for the ranges of 3-12 months however many of them ended up defaulting or running for much longer than agreed.

These loans were secured against property or land with LTV ratios of 11-70%. There was also a discretionary provision fund that allegedly held 2% of the entire loan book in reserve.

All loans were secured against property or land. Lendy used to loan against boats and other items but they veered away from these types of loans in favor of property developments. The loan-to-value ratios on the properties and land ranged from 11-70%.

According to estimates, around 20,000 investors were operating on Lendy, with a total of £165m invested in the firm at the time of its closure. The platform had offered returns of upwards of 12% before things went south. It had been operating since 2013.

The money investors had invested in loans on the platform is now in jeopardy. Many investors also had uninvested money on the platform, and there are also doubts whether that part of their funds can be obtained eventually or not.

Concerned investors have launched the Lendy Action Group (LAG) that has the following aims as stated on its website:

To act as a point of support and provide coordination, news and information to Lendy investors affected by their collapse.
To work collectively to recover our investment. We are many but dispersed – together we become strong.
To be a voice for investors to the administrators, regulators and press.
To explore potential opportunities for further actions (if they become necessary and legal basis can be defined for such).

ORCA Money’s chief executive Iain Niblock has slammed failed peer-to-peer platform Lendy as a “typical example of poor P2P lending”, as he urged investors to seek out less risky loans.

Niblock who also co-founded the P2P investment aggregator and analysis firm said that it was “no surprise that Lendy had gone into administration, citing the platform’s “extremely poor” loan book performance and regulatory issues, which had been a cause for concern among investors for some time.

“Disappointingly, the lender was at one time one of the more popular UK P2P platforms with cumulative lending volumes reaching £428m,” Niblock added. “Over 22,661 lenders were attracted to its simple one percent interest per month offering.

“The platform grew rapidly in 2016 with cumulative lending growing from £79m by the end of 2015 to £271m by year end 2016. The company has suffered from extremely poor loan performance with worryingly high numbers of loans in defaults. Currently, on the platform there is £97m worth of loans in default and, only £65m of loans repaying.”

Now that an investigation is underway, it has become apparent that there was foul play by the owners of Lendy, Liam Brooke and Tim Gordon (see video of them further down):

Detailed investigations have been undertaken into the Company’s affairs during the period covered by this report, with the assistance of the Joint Administrators’ instructed solicitors Pinsent Masons LLP. The investigations have included carrying out reviews of the Company’s books and records, performing detailed analysis of the Company’s bank statements and reviewing the results of key word searches of the c480,000 Company emails held by the Joint Administrators. The Joint Administrators have now also carried out interviews with both Liam Brooke and Tim Gordon, the former directors of Lendy. The investigations have been concerned with a number of transactions, most significantly payments of approximately £6.8million that were paid to entities registered in the Marshall Islands for apparent marketing services carried out for Lendy. It is the Administrators’ position, however, that these payments were ultimately for the benefit of Liam Brooke and Tim Gordon. As a result of these investigations, on 1st June 2020 the Joint Administrators made an application to Court for a worldwide freezing injunction to be granted over the assets of Liam Brooke and Tim Gordon, as well as proprietary injunctions on the properties owned by companies linked to the directors, RFP Holdings Limited and LP Alhambra Limited. The Order was granted on the 4 June 2020. Proceedings have now been commenced against Liam Brooke, Tim Gordon, RFP Holdings Limited and LP Alhambra Limited. Owing to the nature of these claims, the Joint Administrators are unable to provide further information at this time. The Joint Administrators are continuing to investigate the affairs of the Company, however again, we are unable to provide further information at this time so as not to prejudice these investigations.

It is quite evident that they were scamming investors, as can also be indicated by this other article.

So let’s talk about those lessons I mentioned earlier. One of the biggest reasons behind my investing in P2P platforms and real estate crowdfunding is to learn how to invest as well as analyze my feelings when an investment is a success or when it tanks. The knowledge I get and the awareness of my feelings will guide my investing decisions further on in life, when being careful with my money will be of even more paramount importance due to aging, lower earning potential, and the necessity to support my children.

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Should You Invest in Peer-to-Peer Lending in 2025?

Last updated: November 28, 20248 Comments

Peer-to-Peer investing is an excellent alternative investment. It can be compared to some other traditional investments to see whether it makes sense to invest in peer to peer platforms.

Contents

Peer-to-Peer platforms solve two problems:

Private lenders/investors need returns because savings rates are low
Borrowers need money to support and grow businesses or to fund deals

Whether you should invest or not in P2P lending is a multi-faceted question. I think we should start by comparing P2P lending with other investment alternatives.

P2P Lending VS Crypto Lending

By crypto lending, we usually mean a form of P2P lending that features crypto assets as collateral. The interest rates are typically lower than those available for traditional P2P lending, however, the fact that the loans are overcollateralized can bring a much higher degree of safety. On the other hand, many people still distrust anything crypto-related. I personally think that crypto lending platforms like YouHodler and Nexo provide a better deal than most traditional P2P lending platforms, but it can easily be argued that the risk-profile is higher.

P2P Lending VS Crowdfunding

Peer-to-peer lending is actually also known as crowdlending, which gives you a clear indication that there are lots of similarities with crowdfunding. The latter is a way to raise money for a project, without having to resort to venture capital.

The difference is that with crowdfunding the end goal is to fund a product, and usually receive the product in return, as in platforms like Kickstarter, while with P2P lending the investors are buying parts of loans with the aim of receiving back principal plus interest (the profit).

With crowdfunding of products, we can’t really talk about return percentages, although we can have a look at crowdfunding of real estate, in which case you will have a percentage return.

P2P Lending VS Real Estate Deals

There are many ways of investing in real estate, and then again many types of real estate deals. If we compare P2P lending to real estate crowdfunding via online platforms, we can see that P2P lending has the clear edge when it comes to returns.

With real estate crowdfunding, you can expect 3-7% returns while with P2P lending you can expect 10-15% consistent returns.

Of course, this comes at an extra risk. Real estate investing has a lower risk profile simply because in the case of borrower problems or default you can resort to having a claim on the underlying property, and thus it is easier to recover debt, at least partially.

P2P Lending VS Bank Savings

Bank savings rates are still abysmally low. If you have large amounts of sitting in bank savings accounts for a long time, you will lose money to inflation as the cost of living and goods increase. If you need your funds in the short term, holding the money in a savings account can make sense, but if you don’t need the money, then you would be better off taking the necessary investment risks to grow your money using compounding interest.

P2P Lending VS Company Bonds

Bonds are usually unsecured and when you invest in a company bond or mini-bond, you are investing money directly into the company which is risky. If the company goes out of business (which does happen), bond investors are usually treated as unsecured creditors and are at risk of losing their capital. To top it off, bond rates aren’t even that attractive with most bond offerings paying between 3.5-7%.

If you are going to take risks, it makes more sense to invest through reputable FCA regulated peer to peer lending companies offering secured loans that pay equal or more interest than private bonds pay.

P2P Lending VS Stocks

Equities had a pretty poor year in 2018, and when we compare stocks versus P2P lending we can see that the latter’s returns were 26% higher. They’re also risky in their own right. I would still suggest investing in stocks for the long-term, however, if you want to start earning money right away then P2P lending is the way to go.

Bank savings accounts, stocks, and bonds are the most popular investment options for much of the population, so for the purposes of this post, I won’t delve into other options such as cryptocurrencies, gold, startups, etc.

With those alternatives covered, let’s talk about something that very few people seem to consider when it comes to investment, especially P2P lending…

Downsides of P2P Lending

There are several potential downsides that we should keep in mind when considering investing in P2P platforms.

Risk

Let’s make this clear. P2P lending is an investment class that carries moderate risk, and you should always be aware of that. In the event of the world economy going south, I expect P2P loan originators and platforms to suffer considerably, with a potential loss of some of the capital I have invested.

Having said that, there are several ways of managing risk. Besides the fairly obvious risk management technique of diversifying into other types of investment apart from P2P lending, you can also use several P2P lending platforms, several loan originators and always invest little money in each loan, so you end up with thousands of microloans instead of a few loans in which you are highly invested.

Also make sure you invest in the right platforms, you can take a look at my favorite European P2P lending platforms to find some highly rated ones.

Time Investment Required

Investing on P2P platforms like Mintos and Twino can be as simple as using the platform’s auto invest strategy, putting in an amount of money, activating the strategy and sitting back to wait until the interest starts rolling in. This takes just a few minutes.

On the other hand, if you’re going to be investing in several platforms and digging deeper into how the platforms and different types of loans work, you will spend a considerable amount of time on your P2P lending investments.

Frankly, when I see the net worth reports and monthly income reports of many FIRE bloggers, I wonder what’s the point behind all they’re doing. The only explanation for spending so much time for so little return is that they are making much more money off the affiliate commissions they get when promoting some P2P platforms. It doesn’t make sense to spend say 20 hours a month on something when you’re earning €100 in interest. That’s not even taking into consideration the risk of your capital invested due to platform or loan originator bankruptcy.

Again, that’s why I would recommend just investing your money on something like the Mintos Invest & Access system as it’s very low maintenance and very liquid.

There is, however, one possibility where it is justified to spend a lot of time on P2P lending platforms even if you don’t have a huge chunk of money to invest. This is when you’re doing it as a learning exercise in order to get into the investing world and learn how everything works. I’ll talk about this in more detail in the Advantages section further down.

Advantages of P2P Lending

High Returns

I don’t know of any other investment class that is so easily accessible to the average person and provides such high returns. Cryptocurrency is the other investment class that comes to mind, but it’s way riskier and much more difficult for the average person to enter due to a high technical barrier of entry, developing legislation, and high complexity.

If you want to really grow your net worth aggressively, P2P lending is a great option.

Learning about Investing

While I spend a lot of time on real estate crowdfunding and P2P investing, the main reason why I’m doing all this is that a few years ago I set a target for myself to really learn the ins and outs of investing in different asset classes.

P2P platforms and crowdfunding websites are the perfect places to learn about investing.

Since you’ve got your money at stake, you’re much more likely to take things seriously and really learn the stuff than if you were just reading a book about investing.

It’s important that you learn not only how things work, but also how you react to things. At the end of the day, investing is also about handling your emotions.

What do you do when you’re riding a huge way of optimism, such as the Bitcoin bull run of 2017?

And how do you feel when everything you invested in seems to be burning to ashes?

Knowing how you react will help you become a better investor, as you will learn that perhaps certain asset classes stress you out too much and are best avoided, or maybe that you are not very risk-tolerant and would prefer to invest in a globally diversified index fund than pick investments yourself.

Whatever the lesson, the guarantee is that you will learn a lot, and in my opinion that knowledge and experience are far more valuable than the monetary returns.

Conclusion

Every single investment method has its pros and cons, including property (high cost of entry, increased stamp duty taxes, landlord headaches), stocks, shares and funds (if the market crashes, your capital and emotions could spiral downwards), and bonds (returns are low).

Peer-to-Peer lending is not without its issues. Some companies are complicated to understand and have a higher investment learning curve. If you invest through the wrong companies, don’t diversify correctly, only choose high risk/reward loans chasing returns or select the wrong loans, your returns could be in the red. But if diversify correctly by spreading your money across several companies and loans, P2P lending can be a very positive investment vehicle.

You can read about my favorite platforms here, but if you want to cut to the chase I can tell you right away that my absolute favorite is Mintos, and that’s where I put most of my money. I’ve been able to achieve 11,42% returns per year which I’m very happy with.

You will also notice that there are now a ton of bloggers that write about their portfolios and favorite platforms. I advise you to select 2-3 platforms that look interesting and read as much as you can about them, don’t just trust me or any blogger when choosing platforms. It’s your money and you should make an informed decision on how you invest it.

You should also always consider the taxation consequences of every investment you make. I’ve even covered taxation of P2P platforms in a separate post so you can check that out for starters, although you’ll obviously need to check the specific tax rates in your country of residence.

If you had to ask me for just one platform that you should check out and dig deeper into, as I said, Mintos is currently the biggest, most liquid and most transparent P2P lending platform in Europe. Next up I would say Twino and Bondora are the ones I’m liking the most.

How P2P Lending and Property Crowdlending is Taxed in Spain

Last updated: September 29, 20225 Comments

Crowdlending is very popular in Spain, and I have written about my experience with property crowdfunding platforms in Spain before. For the purposes of this article, crowdlending and crowdfunding are interchangeable as they are treated the same for tax purposes.

This includes P2P lending platforms in Europe; as a Spanish resident this income will also be taxed according to the savings rates.

Any interest obtained is declared as benefits from movable capital. This is pretty much the same as profits obtained from deposits or dividends from stocks. You need to declare interest even if that same interest has been re-invested or never withdrawn from the crowdfunding platform. If you receive dividends in 2020, you will declare them in 2021; always one year later.

In the IRPF form, look for box number 23, where you will need to insert the total amount of profits, without discounting any retenciones imposed by the platform.

If you are receiving dividends from foreign crowdlending platforms, they will be declared in the same way as the Spanish ones. Remember that in the IRPF you declare your worldwide income. There is no other obligation to comply with when investing in foreign platforms.

Most Spanish crowdfunding platforms will automatically deduct 19% from your profits and declare them to Hacienda. Once you access your Hacienda account, you will be able to see all your retenciones.

Income from property crowdfunding is classified as savings income in Spain. There are the following tax bands in place:

Spanish tax rate on savings income up to €6,000: 19%
Spanish tax rate on savings income from €6,000 to €50,000: 21%
Spanish tax rate on savings income over €50,000 to €140,000: 23%
Spanish tax rate on savings income over €140,000: 27%

You might have noticed that the lowest band is 19%, and that is why the Spanish crowdfunding platforms automatically pay tax of 19% on your behalf. If your income from such platforms is higher than €6,000, you will have to pay additional tax according to the bands above.

If you are participating in property crowdfunding on platforms that are based outside of Spain, they will normally send you the full proceeds from any dividends or capital gains due to sales of property. You will then have to declare the income on your IRPF tax form, which is due for submission between April and June of the following year.

I hope that helps you understand what taxes you typically have to pay after investing in property crowdfunding platforms.

Note that you will also have to take into consideration the Modelo 720 when thinking about taxation and reporting. While modelo 720 does not require the declaration of any loans given out to thid parties, you might have idle cash sitting in your platform’s accounts and sometimes these need to be declared.

If you have any further questions let me know and I’ll do my best to answer them.

You can find more information about paying taxes in Spain on this site.

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Please note that I am not an accountant or financial advisor, the above is the fruit of my personal research, and might contain inaccuracies. Before you submit any tax returns, I highly recommend you contact a tax consultant or accountant to check your numbers.

💶 The Best European P2P Lending Platforms in 2025

Last updated: March 17, 202593 Comments

Amongst all the online investment platforms available today, European peer-to-peer lending sites are the ones that offer the highest returns.

Let’s have a look at how P2P lending works and which are the best European P2P lending sites.

Why do I focus on Europe? Simply because I am European and currently based in Europe. Most US lending sites, as well as some UK lending platforms, prohibit European citizens from investing, so this post focuses exclusively on those platforms that are available to all European citizens. The nice thing is that the majority of European P2P platforms accept international investors.

Another reason for focusing on Europe is that currently, the European platforms offer higher returns than those in the United States or Asia.

Without further ado, let’s jump straight into a list of what I consider the best platforms available nowadays. I will then proceed to talk about the P2P lending space in general for those who are new and want to learn more about this asset class.

The Best European P2P Lending Platforms

Now let’s explore each of them further.

If you’re unsure which platform to invest in, one of the best things you could do is to check the platforms’ ratings on multiple channels. I’ve analyzed most of the platforms out there, used several, and taken a look at their Facebook, Trustpilot, and Google scores, so here’s the list of top P2P platforms in Europe at the moment.

I also keep an eye on the market data on European P2P lending every month, as this is an important indicator of whether any of the platforms are in trouble or whether they are in a healthy growth and profitability stage.

Mintos

Mintos is undoubtedly the powerhouse of European P2P lending platforms. Founded in 2015 in Riga, Latvia, Mintos has quickly grown to become the largest and most trusted platform in the region. It offers a plethora of investment opportunities across a wide variety of loan types, including personal loans, business loans, and mortgages. With more than 340,000 investors and a stunning €7 billion in funded loans, Mintos has established itself as the go-to platform for P2P lending enthusiasts.

The interface is great; everything is understandable and you don’t need to fish around for data. You get a daily report in your inbox and you can also use the auto-invest functionality, which I always do.

See also: My full review of Mintos – I invested €150,000

Mintos has a solid secondary market which provides investors with liquidity. If you want to sell off your loans at any point, you can put them on the secondary market, choosing whether to apply a discount (making them more attractive) or add a premium (less attractive). If you want to sell quickly, applying a discount is the best way to do this.

The minimum investment in any single loan on the primary market is EUR 10, DKK 80, GEL 25, PLN 50 or CZK 300. There is no minimum for investments in the secondary market.

You have to be careful when setting the auto-invest parameters on Mintos. Check out the Mintos lender ratings post on Explorep2p as well as the Mintos loan scanner to see which are the most trustworthy lenders on the platform.

The income earned at Mintos is taxed for each investor based on the legislation of the respective country where the investor is a tax resident. Each investor can receive extensive information necessary for tax returns when logged into their Mintos investor account.

You can add funds safely via your online banking directly in the app, by bank transfer, or with a debit/credit card. I recommend using N26, Wise or Revolut when doing deposits and withdrawals as you avoid fees altogether.

Companies can also invest through Mintos without any problem. There are specific documents that need to be provided in order to comply with AML legislation, but it’s pretty straightforward.

During the past three years, Mintos experienced significant growth, making it the peer-to-peer lending market leader for continental Europe with a 38% market share according to AltFi Data. Since their establishment, they have exceeded EUR 660 million in cumulative investments by investors and they expect the number of loans funded to reach EUR 1 billion by the end of the year.

Over the past years, Mintos have made considerable investments in technology, people and the marketplace, making the service even more convenient for investors. The number of investors has been growing in exponential numbers year on year. As an investor, this is reassuring, as I know I’m not alone using this platform, but I’m joined by tens of thousands of others like me.

On Mintos, you can expect returns between 6% and 18%, and the minimum investment per loan is €10.

Lonvest

Lonvest is a promising newcomer in the European P2P lending space, offering investors an opportunity to earn passive income through carefully selected loans. Despite being a relatively new platform, Lonvest has positioned itself as a serious player by focusing on transparency, investor security, and attractive returns.

The platform provides investors with access to loans that are backed by a reputable loan originator, ensuring a layer of protection against potential defaults. With a straightforward and user-friendly interface, investors can easily navigate their portfolios, set up automated strategies, and track their earnings in real time. Lonvest also offers competitive interest rates, making it an appealing choice for those looking to diversify their investment portfolios beyond traditional assets.

See also: In-depth review of Lonvest

One of the standout aspects of Lonvest is its commitment to building a sustainable and secure lending environment. The platform implements rigorous due diligence processes to assess loan quality and borrower credibility, ensuring that investors are exposed to well-vetted opportunities. Additionally, with buyback guarantees in place on many loans, investors have an extra layer of confidence when deploying their capital.

For those seeking a fresh yet reliable P2P lending option in Europe, Lonvest is certainly worth considering. Its combination of solid returns, transparency, and security features make it an attractive addition to any investor’s passive income strategy.

Swaper

Swaper is one of the latest entries into the P2P lending space in Europe, having started operations in May 2019. They have found success pretty quickly though, amassing more than 4000 active investors, 160m euro in investments and 2.1m euro in interest paid back to investors.

See also: In-depth review of Swaper

I really like this platform and the team has been extremely pleasant to deal with whenever I contacted them.

Join Swaper

PeerBerry

Launched in 2017, PeerBerry has been gaining quite a lot of popularity among peer-to-peer platforms recently. As with many crowdlending platforms, PeerBerry originated in the Baltics – specifically Riga, Latvia.

This platform has an average annual investment return of 11.51%, a solid return for most platforms. With more than 18,000 investors and over €212 million in funded loans, PeerBerry is certainly making some waves in the peer-to-peer business.

As with many peer-to-peer platforms, PeerBerry offers an Auto Invest function and a BuyBack guarantee. Unfortunately, however, no secondary market is available yet.

I really like this platform and its website. PeerBerry has the potential to be one of the big players in European P2P over the coming years.

Open an account with Peerberry

LANDE Finance

LANDE was started in 2019, when two experienced professionals from the secured lending sector Ņikita Gončars and Edgars Tālums became aware that there is a niche in the crowdlending market, as none of the existing market players offered low-LTV investment deals.

LANDE is going after the agricultural loans niche. There is currently a big gap between the financing needs of farmers in Eastern Europe and what’s available to them from banks and other lending providers.

Read more: My full review of LANDE

All projects are first rank mortgage, which is the most secure type of mortgage you can get. Other platforms offer second-rank mortgages which are riskier, but can have higher interest rates.

I would recommend having a look at LANDE as it might be one of the most innovative players in the space going forward. It’s worth mentioning that LANDE also has skin-in-the-game for every project launched.

Invest on LANDE

Bondora

Bondora is one of the oldest peer-to-peer lending platforms, and I joined early on in my P2P lending journey, around 2016.

While this platform has been criticized by investors in the past, my portfolio has been chugging along quite well over the years, and my only complaint would be about the graphics and UI of the platform, which I find really ugly.

Read more: My in-depth review of Bondora

I’ve obtained a return of 17% while investing on Bondora.

If you’re looking for a reliable platform I would recommend taking a look at Bondora, as they have one of the best track records in the industry.

Invest on Bondora

Profitus

Profitus is a Lithuanian real estate crowdfunding and investments platform that has been operating successfully since 2019.

Read more: My review of Profitus P2P lending

The platform acts as an intermediary between investors, who are looking to employ their free money and those who want to receive funding for business ideas and real estate projects.

Try Profitus

What about Other Platforms?

There are several other sites that I consider either a scam or badly managed and on the course toward bankruptcy and loss of investor funds. Be very careful who you trust when investing in these platforms.

Many people just want to paint a nice picture for any platform just to take in commissions, and the platforms themselves all try to emphasize how safe they are and what great opportunities they are offering to investors. Don’t believe everything, and check out my list of worst P2P lending platforms before you proceed.

If you’re concerned about the safety of P2P platforms, make sure you also read my post on whether it is safe to invest in P2P lending.

🌍 Who Can Invest in P2P Lending Sites?

These European lending sites are open to all European investors, possibly even those outside of Europe in some cases. The only exceptions are the UK-based platforms, which are typically restricted to investors resident in the UK. CapitalRise is one such example. It’s been around since 2005 but is restricted to UK-based people.

The majority of platforms that are open to other countries are based in the Baltic countries.

Many of these platforms are available in more than one language, precisely to cater for the fact that in Europe people speak so many different languages and might not be comfortable investing their money if the site is only available in English.

From my experience, at the moment in Europe, the country with the most investors in P2P lending is Germany, leading by a long margin. German investors love P2P platforms. Germany is a country where people have a high purchasing power and they are looking for good returns on their savings, and hence P2P lending platforms are a great match for them.

What Returns Can Lenders Expect?

The returns that lenders/investors can expect vary depending on the economic climate. If interest rates are low in general, then we can expect that platforms will offer lower rates as well. This is the current economic outlook worldwide. But 15-20 years ago bank interest rates were very high, so it would not have made sense to invest in P2P platforms when your savings account already rewarded you with 10% returns guaranteed.

Nowadays, you barely find any bank accounts giving you 1% returns, so the returns of 10-15% offered by P2P lending sites are way better in comparison.

It is important to understand that such investments are to be considered alternative investments with a rather high-risk profile. You will most probably have loans that default, but the idea is that the overall returns will eclipse these minor defaults.

Risks of P2P Lending

For each investment class, and indeed every investment you make, you need to carefully consider the risks involved. There’s a lot to say about the safety of P2P lending and what risks you need to consider, so I wrote a separate guide on whether P2P lending can be considered safe that you should find interesting.

Alternatives to P2P Lending

If, like myself, you want to diversify beyond P2P lending, I would suggest you read up on real estate crowdfunding platforms as well as crypto interest accounts. You can obtain similar rates of return (usually 3-4% less than P2P lending) but these other types of investors tend to be safer as they involve collateral.

✅ Conclusion

If you’re interested in trying out peer-to-peer loan platforms, I suggest you start with Peerberry or Swaper.

If you have any questions about any of the platforms I mentioned, or how the model of peer-to-peer loans works, please leave a comment and I’ll do my best to answer your questions.

Before you make any investment decisions, I also encourage you to have a look at how your country taxes proceeds from peer-to-peer lending. You can check out my article on how peer-to-peer lending is taxed to get started on this topic.

You should also read about the risks of P2P lending before making any investments, and make sure you are comfortable with that level of risk for the money you are putting into P2P lending platforms.

Have you invested in p2p lending platforms? What has been your experience with these platforms?