P2P lenders eliminate the requirement for small businesses to have to abide by the mandates set forth by larger institutions,
Boston MA (PRWEB) February 22, 2013
LeaseQ, one of the leading providers of business equipment leasing and financing in the United States, is seeing an increase in the practice of peer to peer lending, and indicators that this may very well be one of the waves of the business future. P2P lending pairs individual borrowers with proven credit histories with private lenders who make sizeable loans, usually at very favorable rates, without involving banking institutions as intermediaries.
“Market leaders Prosper and Lending Club have been responsible for the investment of more than $1 billion into the accounts of American citizens and their ventures,” Lewis Humphries of Investopedia reports. “It is also estimated that traditional banks in the U.S. are now responsible for just 25 percent of all lending.”
P2P lenders eliminate the requirement for small businesses to have to abide by the mandates set forth by larger institutions, many of which have been extremely hesitant to lend money to entrepreneurs at anything resembling a competitive rate.
P2P lending also works for those who have an abundance of cash. Since there is no bank involved, extraneous expenses such as advertising, deposit insurance, government licensing, and executive salaries no longer apply. As a result, P2P loans are priced much more attractively for lenders and borrowers at rates that would not be possible in traditional scenarios.
Another attractive option is the low risks associated with P2P. One reason for this is found in the careful vetting or borrowers, and another is that lenders can distribute their money across multiple loans, eliminating much of the damage that may be done to their investment capital if any one single borrower were to default.
Based in Boston MA, LeaseQ is one of the leading providers of commercial equipment leasing and financing options in the United States, with plans available to serve both new business startups and Fortune 500 companies.