Small, medium, and big organizations always need extra funding to ensure consistent growth of their businesses. They have to rely on loan providers, whether banks or financial services. They utilize the borrowed money for the following reasons:
When the need for funds arises urgently, won’t it be beneficial for SMEs to use a crypto Peer to Peer Lending Software to get instant assistance? Continue reading to learn about how FinTech is benefitted from Peer to Peer Lending Platform Software and how it is helpful in filling the gaps that remain uncovered by traditional banking systems.
Traditional banks require SMEs to complete a series of paperwork. As of now, banks are providing online services to their customers, which has made it comparatively easier for businesses to apply for loans, but it’s still time-consuming to fill out the necessary documents and get approval for loans. Thus, businesses will like to give preference to the use of crypto P2P Lending Software for finding quick assistance.
Here are some shortcomings in the traditional lending-borrowing processes:
As the trend of cryptocurrency is growing, it has resulted in the evolution of Peer to Peer Lending Platform Software that is backed by decentralized blockchain technology and smart contracts. It has opened new avenues for accessing financial help from the crypto community and ending sole dependence on the traditional banking infrastructure.
P2P Lending Software users are able to enter a loan agreement without involving any intermediaries. Rather, the self-executable smart contacts make it easier for lenders and borrowers to complete the transactions with complete trust and transparency. However, the requirement of collateral is one thing in similar in both, fiat-based loans sought through the banks and crypto-based loans sought through the P2P networks. When the borrower applies for a loan, the maximum amount that can be approved depends on the amount of collateral. Lenders get a fixed rate of interest from the borrower for the money provided. When we use crypto P2P Lending Software, the loans are automatically approved once the terms and conditions are fulfilled.
Crypto-banked loans are processed without involving intermediaries, which lowers the processing costs, shortens the settlement period, and helps to fulfill the needs of SMEs immediately. Thanks to the technologists who have been building Peer to Peer Lending Platform Software with amazing features and functionalities.
It’s beneficial for SMEs to use P2P crypto lending platforms for arranging funds. Let’s find out how!
Cryptocurrency is not always managed through decentralized networks. There are some FinTech companies like BlockFi, Celsius, and SALT that have centralized P2P Lending Software and play a similar role as a traditional bank or financial service provider. They follow KYC (Know Your Customer) protocols, keep your crypto assets under their custody and act as a middleman between the crypto and fiat currency ecosystems. These organizations create their own set of rules for lending money & setting interest rates and often avoid the usage of smart contracts.
On the other hand, decentralized lending focuses on offering crypto loans through the blockchain, without involving any intermediary. The Peer-to-Peer Lending Platform Software users can apply for a loan directly using the mobile app, through the decentralized platform. It is managed with the help of smart contracts.
Popular Decentralized Lending Borrowing Platforms
All the above-mentioned Peer-to-Peer Lending Platform Software platforms provide lending access to users, without completing KYC documentation or involving any centralized custodial intermediary. All transactions are managed through smart contracts, and a decentralized governance system helps to fix interest rates automatically. Variable interest rates can also be implemented using P2P Lending Software functionalities. This facility has made a considerable impact on the process of lending borrowing using technological advancement in the cryptosphere.
It has a promising future. Here’s why:
The evolving technology behind the development of Peer to Peer Lending Software apps acts like a game changer in the financial industry. There are numerous benefits to using such apps, which includes quicker loan processing, greater transparency, lower fees, low-interest rate, and easy access to lenders.
Peer to Peer Lending Platform Software helps to automate the loan approval process, as it uses smart contracts. This is what makes the P2P lending platform becomes more reliable and efficient. Are you feeling interested in creating such P2P Lending Software that can help businesses? Connect with the experts at Antier, the blockchain master.