P2P Industry: How the Business Works

P2P Industry: How the Business Works

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We’ve created many pieces lately on the topic of P2P as a whole. Here is possibly the best description of the economy as such, and we wanted to share it with you before we dig deeper into how P2P business actually works. It comes from Investopedia and is framed as follows:

 “A peerto-peer (P2P) economy is a decentralized model whereby two individuals interact to buy or sell goods and services directly with each other, without an intermediary third-party, or without the use of a company of business. The buyer and the seller transact directly with each other.”

So why mention this? The description explains the need for businesses to evolve and adapt their business model and strategy to be able to compete with this new economy, and to consider the consumer as well as business needs that arise from it. Its fair to say that this definition mostly describes the direction P2P platforms in UK has decided to go, as platforms present in continental Europe mostly lists pre-funded loans rather than directly connects borrowers with investors.

 

Consider the way that Facebook, for example, started by realizing the social needs of people and providing a platform in which to meet those social needs by bringing millions of people all over the world together and giving them a platform or “means” in which to connect, keep in touch, and share moments, experiences, and memories with each other.

Small businesses also felt that there was a need to erase the gap between providing a service and building their brands and attracting more customers, and they naturally moved into commerce by allowing people to advertise their businesses, giving them a means via analytics and algorithms to advertise to very specific markets and demographics.

Ultimately the aim of the game is bridging the gap between a party with a certain need (in this case people who need money i.e. P2P borrowing) and people who can provide for that need (in this case P2P lending and investing). In terms of P2P lending both private individuals and consumer lenders may use P2P platforms to collect additional funding.

Now, in order for businesses to stay relevant, they’ve had to adjust their strategies based on this description. But as mentioned, it also gave new entrepreneurs and companies like VIAINVEST the opportunity to provide a platform that can bring the client and the provider together in a safe environment.

Let’s take a look at the average P2P business model as well as that of VIAINVEST so we can put things into a tangible perspective.

 

P2P Business Model: The Initial Case of Platforms in the UK

Customers.com explains this business model best with their examples of Lyft and Uber:

“The peer-to-peer business model works on the premise of playing matchmaker between individuals with a service to offer and others who could use that service. Your company can provide the platform, rules and regulations, and payment/remuneration methods to facilitate this type of community-based business. We look specifically at Lyft, a company that helps individuals who need a ride match up with people who have a car and want to earn a few bucks by giving them rides.”

As they put it, it’s a game of matchmaking between consumer and service or product provider.

Now having said that, you can be sure that these “matchmakers” will most certainly take their share of the pie.

Some of these companies may even take up to 20 percent of the transaction value before any profit is even made by the service provider because they have sole control over payment structure and price negotiation.

 

What Makes the VIAINVEST Business Model Different?

Unlike the traditional P2P model where individual requests are funded directly from investors without any intermediary involvement as consumer lender, VIAINVEST steps in to bridge that gap. But we make it financially worth your while.

VIAINVEST operates under the parent company VIA SMS Group, founded in Latvia in 2009. (Check out the write up from P2P Hero , which explains a bit more on how the company evolved and is put together as a whole.)

With VIAINVEST there is no fancy mumbo-jumbo or creative business jargon; the philosophy is very simply put as being; “An intermediary platform connecting borrowers with investors by offering safe and transparent investment opportunities. No service fees or hidden costs are charged for using this platform.”

But we also carry the risk for you in a sense. If you borrowed directly from a lender/person you didn’t know, you run the risk of being scammed, transactions being unsecure, or even fraudulent.

VIAINVEST ensures safe and secure transactions that are cost effective in terms of repayments, and provides a certain quality of standards you may not necessarily get when you go at it yourself.

Quite simply put, our model is to be the middleman that bring borrowers and investors together to complete a seamless transaction without the cost of a middleman.

VIAINVEST lists loans originated and pre-funded by VIA SMS Group to help to finance lending business adding even more security to your deals. It’s a fast-growing company that has originated millions of loans over the last few years, offers safe and reliable investments, and has thus become a leading P2P platform today that has great worth.

 

 

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VIAINVEST

Peer-to-peer lending platform

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