Peer-To-Peer (P2P) Lending:
After digital payments and digital lending, the Reserve Bank of India is looking closely at platforms that facilitate direct, or peer-to-peer (P2P), lending between individuals.
- Peer-to-Peer (P2P) lending is done through a website that connects borrowers and lenders directly.
- Those who want to lend money, open an account with a P2P platform as a lender. And those who require a loan register themselves as a borrower.
- It enables individuals to obtain loans directly from other individuals, cutting out the financial institution as the middleman.
- In 2017, the Reserve Bank of India brought this service under its regulatory purview.
- Only an NBFC can register as a P2P lender with the permission of RBI. Every P2P lender should obtain a certificate of registration from the RBI.
- The minimum capital requirement to set up a P2P platform is fixed at Rs. 2 Crores.