Peer to peer lending is the process, which enables individuals or businesses to obtain loans directly from other individuals or lenders without the involvement of financial institutions or banking sector. In addition, many peer to peer companies offer online services with an attempt to operate with lower overhead cost and provide loan services more economically to the lenders. Furthermore, this platform provides investors with the opportunity to make low-risk investments and to build up a diverse portfolio of assets.
The growth of the global peer to peer lending market is driven by lesser operating costs and lower market risk associated with P2P lending for the lenders and the borrowers. In addition, digitization in the banking sector, which adds more transparency over the traditional banking system fuels the growth of the market. However, the risk of losing money, implementation of government regulation for loan processing, and low awareness of P2P lending benefits among the population hamper the growth of the market. On the contrary, the increase in demand for alternative lending options such as P2P lending platforms that offer a convenient and faster way to access funds is expected to provide lucrative opportunities for the growth of the market.
The peer to peer lending market is segmented into business model, loan type, end user, and region. By business model, the market is differentiated into traditional lending, and alternate marketplace lending. On the basis of loan type, it is segmented into consumer credit loans, small business loans, student loans, and real estate loans. Depending on end user, it is fragmented into business and personal. Region-wise, the market is segmented into North America, Europe, Asia-Pacific, and LAMEA.
The key players operating in the peer to peer lending market include Funding Circle Limited, LendingClub Bank, SocietyOne, Harmoney Australia Pty Ltd, Linked Finance, Lending Loop, LendingTree, LLC, Prosper Funding LLC, Upstart Network, Inc., and goPeer. These players have adopted various strategies to increase their market penetration and strengthen their position in the peer to peer lending industry.
The growth of the global peer to peer lending market is driven by lesser operating costs and lower market risk associated with P2P lending for the lenders and the borrowers. In addition, digitization in the banking sector, which adds more transparency over the traditional banking system fuels the growth of the market. However, the risk of losing money, implementation of government regulation for loan processing, and low awareness of P2P lending benefits among the population hamper the growth of the market. On the contrary, the increase in demand for alternative lending options such as P2P lending platforms that offer a convenient and faster way to access funds is expected to provide lucrative opportunities for the growth of the market.
The peer to peer lending market is segmented into business model, loan type, end user, and region. By business model, the market is differentiated into traditional lending, and alternate marketplace lending. On the basis of loan type, it is segmented into consumer credit loans, small business loans, student loans, and real estate loans. Depending on end user, it is fragmented into business and personal. Region-wise, the market is segmented into North America, Europe, Asia-Pacific, and LAMEA.
The key players operating in the peer to peer lending market include Funding Circle Limited, LendingClub Bank, SocietyOne, Harmoney Australia Pty Ltd, Linked Finance, Lending Loop, LendingTree, LLC, Prosper Funding LLC, Upstart Network, Inc., and goPeer. These players have adopted various strategies to increase their market penetration and strengthen their position in the peer to peer lending industry.
Key Benefits For Stakeholders
- The study provides in-depth analysis of the peer to peer lending market along with current trends and future estimations to illustrate the imminent investment pockets.
- Information about key drivers, restrains, & opportunities and their impact analysis on the peer to peer lending market size are provided in the report.
- The Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the industry.
- The quantitative analysis of the peer to peer lending market from 2022 to 2032 is provided to determine the market potential.
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Key Market Segments
By Business Model
- Traditional Lending
- Alternate Marketplace Lending
By Loan Type
- Consumer Credit Loans
- Small Business Loans
- Student Loans
- Real estate Loans
By End User
- Business
- Personal
By Region
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Rest of Europe
- Asia-Pacific
- Australia
- India
- Japan
- South Korea
- Singapore
- Rest of Asia-Pacific
- LAMEA
- Latin America
- Middle East
- Africa
- Key Market Players
- Funding Circle Limited
- SocietyOne
- Linked Finance
- Prosper Funding LLC
- LENDINGCLUB BANK
- Harmoney Australia Pty Ltd
- Upstart Network, Inc.
- goPeer
- LendingTree, LLC
- Lending Loop
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Table of Contents
CHAPTER 1: INTRODUCTION
CHAPTER 2: EXECUTIVE SUMMARY
CHAPTER 3: MARKET OVERVIEW
CHAPTER 4: PEER TO PEER LENDING MARKET, BY BUSINESS MODEL
CHAPTER 5: PEER TO PEER LENDING MARKET, BY LOAN TYPE
CHAPTER 6: PEER TO PEER LENDING MARKET, BY END USER
CHAPTER 7: PEER TO PEER LENDING MARKET, BY REGION
CHAPTER 8: COMPETITIVE LANDSCAPE
CHAPTER 9: COMPANY PROFILES
List of Tables
List of Figures
Executive Summary
According to the report, the peer to peer lending market was valued at $152.98 billion in 2022, and is estimated to reach $1.70 trillion by 2032, growing at a CAGR of 27.5% from 2023 to 2032.The peer to peer lending market is likely to experience a significant growth rate of 27.5% from 2022-2032, owing to an increase in technological advancements, and a rise in adoption of peer to peer lending platforms.
Peer-to-peer lending is the process, which enables individuals or businesses to obtain loans directly from other individuals or lender without the involvement of financial institutions or banking sector. In addition, many peer-to-peer companies offer online services with an attempt to operate with lower overhead cost and provide loan services more economically to the lenders. Furthermore, this platform provides investors with the opportunity to make low-risk investments and to build up a diverse portfolio of assets. In addition, it protects investors’ money by spreading investments across loans, thereby reducing the risk of the borrower.
Furthermore, in September 2020, goPeer, a financial technology startup, announced the public launch of their digital lending platform. goPeer connects creditworthy Canadians seeking a loan with people looking to invest, disrupting the traditional lending model through its online marketplace. goPeer provides investors with access to consumer loans, an asset class that presents attractive risk adjusted returns and lower duration risk relative to other fixed income investments. Therefore, such strategies drive the growth of the peer to peer lending market.
The market also offers growth opportunities to the key players in the market. Key players are adopting strategies to strengthen their market positions in the peer to peer lending industry, including new technology adoption, product developments, mergers and acquisitions, joint ventures, alliances, and partnerships. For instance, in August 2021, Fintech startup Cred will enable peer-to-peer (P2P) lending for its members. Cred Mint, launched in partnership with P2P non-bank LiquiLoans, allows users to ‘invest’ their savings in a capital pool, which then be used to on-lend to other customers on the platform seeking personal loans. CRED Mint was launched in partnership with RBI-registered P2P non-banking financial company (NBFC) Liquiloans, and this feature was rolled out to some users.
The peer to peer lending market is segmented into business model, loan type, end user, and region. By business model, the market is differentiated into traditional lending, and alternate marketplace lending. On the basis of loan type, it is segmented into consumer credit loans, small business loans, student loans, and real estate loans. Depending on end user, it is fragmented into business and personal. Region wise, it is analyzed across North America (the U.S., and Canada), Europe (UK, Germany, France, Italy, Spain, and rest of Europe), Asia-Pacific (Australia, India, Japan, South Korea, Singapore, and rest of Asia-Pacific), and LAMEA (Latin America, Middle East, and Africa).
The key players profiled in the study are Funding Circle Limited, LendingClub Bank, SocietyOne, Harmoney Australia Pty Ltd, Linked Finance, Lending Loop, LendingTree, LLC, Prosper Funding LLC, Upstart Network, Inc., and goPeer. The players in the market have been actively engaged in the adoption of various strategies such as business expansion, product launch, collaboration, and partnership to remain competitive and gain an advantage over the competitors in the market. For instance, in February 2022, Funding Circle partnered with Chaser so customers of the credit control app can apply for a loan from the peer-to-peer lending platform directly from their account. Chaser contacts its eligible customers to let them know they can apply for a business loan or state-backed recovery loan scheme finance from the P2P platform.
Key Market Insights
By business model, the traditional lending segment was the highest revenue contributor to the market and is estimated to reach $1.18 trillion by 2032, with a CAGR of 26.4%. However, the alternate marketplace lending segment is estimated to be the fastest-growing segment with a CAGR of 30.5% during the forecast period.By loan type, the small business loans segment was the highest revenue contributor to the market, and is estimated to reach $590.46 billion by 2032, with a CAGR of 25.5%. However, the consumer credit loans segment is estimated to be the fastest-growing segment with a CAGR of 32.2% during the forecast period.
By end user, the business segment was the highest revenue contributor to the market, and is estimated to reach $1.02 trillion by 2032, with a CAGR of 26.7%. However, the personal segment is estimated to be the fastest-growing segment with a CAGR of 28.8% during the forecast period.
Based on region, North America was the highest revenue contributor, accounting for $94.40 billion in 2022, and is estimated to reach $938.21 billion by 2032, with a CAGR of 26.1%. However, Asia-Pacific is estimated to be the fastest-growing region with a CAGR of 30.8% during the forecast period.
Companies Mentioned
- Funding Circle Limited
- SocietyOne
- Linked Finance
- Prosper Funding LLC
- LENDINGCLUB BANK
- Harmoney Australia Pty Ltd
- Upstart Network, Inc.
- goPeer
- LendingTree, LLC
- Lending Loop
Methodology
The analyst offers exhaustive research and analysis based on a wide variety of factual inputs, which largely include interviews with industry participants, reliable statistics, and regional intelligence. The in-house industry experts play an instrumental role in designing analytic tools and models, tailored to the requirements of a particular industry segment. The primary research efforts include reaching out participants through mail, tele-conversations, referrals, professional networks, and face-to-face interactions.
They are also in professional corporate relations with various companies that allow them greater flexibility for reaching out to industry participants and commentators for interviews and discussions.
They also refer to a broad array of industry sources for their secondary research, which typically include; however, not limited to:
- Company SEC filings, annual reports, company websites, broker & financial reports, and investor presentations for competitive scenario and shape of the industry
- Scientific and technical writings for product information and related preemptions
- Regional government and statistical databases for macro analysis
- Authentic news articles and other related releases for market evaluation
- Internal and external proprietary databases, key market indicators, and relevant press releases for market estimates and forecast
Furthermore, the accuracy of the data will be analyzed and validated by conducting additional primaries with various industry experts and KOLs. They also provide robust post-sales support to clients.
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