Do you know how your loan gets funded on P2P platforms

Final decision on the interest rate is made by the borrower. Once the platform decides the interest rate as per the profile of the applicant. The borrower has to approve it before his loan is listed on the platform

Fractualization is the percentage of the loan the investor plans to lend to a single borrower. The lender can either opt for auto-invest or choose borrower profiles manually. This helps him in creating a diversified portfolio to get better returns.

As per the RBI guidelines, the P2P platform needs to open two escrow accounts, one each for the lender and borrower to service the loan. These accounts are operated by a trustee, appointed by the escrow bank, maintaining the escrow account. The lender makes the loan disbursements through his escrow account and the borrower repays through his. P2P lending restricts any cash transfer between the parties and advocates that all fund transfers are made through banking channels only.