Lending is a recreational business.

People always seek means to finance their projects.

Loans are a business on their own.

The average Joe is accustomed to taking out loans.

This in the form of a loan for his car or the mortgage of his home.

Other loans include for renovations of a kitchen or bathroom.

Other, more ambitious and entrepreneurial people, to start up their businesses.

It is a flow of money.

And if money flows, it implies you can be a middle man and divert some of it into your own pocket.

Lending can thus become an asset.

Not by lending money from others or taking out loans yourself.

But by providing money others can lend to start their projects.

An initial gut-reaction can be the inability to be paid back.

Which implies money lost.

Or people bailing out with all your investments.

These were risks I took into consideration.

Instead of stopping myself, I sought ways and platforms where I could get a 100% guarantee to get my money back WITH interest.

Turns out there is an entire world dedicated to peer-to-peer lending.

Different platforms worldwide which enable private investors to put varying sums of money up on their platform and INVEST in other people’s projects.

Effectively lending your money to them with a guaranteed payback through various mechanisms.

Depending on the platform, an initial minimum amount must be made available to open up the account (and can be increased over time through monthly/weekly/semestrial payments).

Effectively increasing your portfolio on a steady basis.

For my Belgian readers; I am present as an investor on Mozzeno.

Mozzeno is an example of a Belgian peer-to-peer lending platform.

I have chosen for a local platform by reason of transparency AND the fact they offer a 100% asset protection.

I.e. even if the people can’t repay the loans I still can get my money back.

It also gives me the option to withdraw ALL my invested money in a few days time.

I choose to not subscribe to an international platform for the following reasons:

– Complexity of international relationships and finance.

– Additional transaction fees related to international trade.

– No guarantees on protection of the accumulated returns due to aforementioned.

Peer-to-peer lending is an asset which can almost be viewed as a traditional savings-account.

You open up an account with the platform which you trust most (and I suggest taking a platform from your own region/country in order to increase transparency and evade trouble in case shit goes down).

You upload money.

You get it reimbursed over a period of time by the loan-taker with interest.

To you, the investor, this seems like an old savings-account.

The money increases due to the interests earned.

The difference here is your money actually working for you by being invested.

This is different from the concept of “crowdfunding” like being done on Patreon or other Crowdfunding platforms.

Crowdfunding platforms do not give you monetary rewards in return.

They do not increase your wealth.

Crowdfunding platforms can be considered as platforms where you help people out by investing in their projects…. but getting liabilities in return (I.e. “art”, “previews”, “behind the scenes”, “early access”,… things which do not return value).

Peer-to-peer-platforms, for investors, are thus an asset whereby you can slowly increase your wealth.

Your money is put to work.

And it can be one of the safest investments to be made as it is NOT dependent on price-fluctuations.

How do they work?

It is fairly simple and involves opening an account and depositing money.

From here on out, and depending on the platform, you can invest the deposited money in either specific projects or choose to fund multiple projects.

I suggest doing the latter in order to avoid the risk of losing ALL money on a project flunking.

Most platforms have the possibility to invest through “nodes”.

Nodes are minimal deposits (on a project) to be made.

For example: if you are subscribed on a p2p-lending platform you will have the option to invest in different projects. 

The total cost of the project is the amount of money that needs to be funded.

The trading platform will chop this total amount in small increments so multiple investors can hold different “shares”.

These “shares” are the so-called nodes (i.e. minimum amount of money that needs to be invested to participate).

If you have enough money on your own you can fund the entire project.

But with increased risk not being paid back and carrying the brunt of the loss on your own.

Or you can invest through “nodes” by spreading your deposit over various projects.

In order to safe-guard, and help you as an investor, the platforms will also give pointers to the rendability (i.e. return of investment) as well as an in-house risk analysis.

General rule of thumb being: “the higher the ROI, the more risky the project”.

I have chosen to invest through nodes.

My monthly deposit is being chopped up and spread over a variety of projects.

Some nodes pertaining to projects I already have a share in.

Some nodes who are newly created.

I also automatized my gains to be reinvested into new nodes in order to increase my investments.

So, for example, if I get paid back a 100$ (with returns), that 100$ will automatically be re-used to invest in new nodes.

Effectively using my winnings to make more winnings.

What are the returns?

Returns are higher than a savings-account.

Do not expect to make BIG MONEY in a short amount of time.

Typical returns of investment on a monthly basis varies between 3% to 5%.

While small a snowball effect can be reached through the aforementioned automation of immediately re-investing effectively boosting it to the range of slightly less than 10%.

This depends on the risks willingly to take and the amount of money invested.

To learn more about peer-to-peer lending I suggest clicking here. 

For a variety of platforms, click here. 

Despite the given list I DO suggest looking up a local platform and subscribing there.

All good things take time.

Do not expect to become an overnight millionaire.

But this asset, projected over a long period of time (3-5 years with consistent monthly investments), holds the potential to make some decent money on the long run.

Take care,

Dimitri