Peer to peer lending websites Peer to business lending sites
Peer-to-peer lending need not be limited to person to person social lending, as person-to-business lending is also an option.
Lending to businesses may seem odd concept (it's normally the other way round), but there is a great appetite on both sides. Consumers have warmed to peer to peer lending, and businesses have struggled to get loans from traditional sources.
Below we list the two main peer to peer lending sites and what they can offer savers.
Funding Circle
Funding Circle is an online marketplace where you can lend money to established and growing small businesses with at least two years’ trading history. You can invest as little as £20 and spread your money across lots of businesses.
Information for borrowers
- Fees: Between 2% and 5%, one-off
- Loan period: 1, 3 or 5 years
- Minimum/maximum borrowed: £5,000 / £500,000
- Average rate: around 9.1%
Information for lenders
- Fees: 1%
- Minimum/maximum lent: £20 / no maximum (although maximum £2,000 per bid)
- Average rate: 9.1% (average gross yield)
- Range of rates: Average varies by risk band. (A+: 8.3%, A: 8.2%, B: 8.9%, C: 10.1%)
- Default rates: 1.2%
Thin Cats
Thin Cats offers secured loans to businesses. This puts the firm in direct competition with the banks rather than other unsecured lenders, including many in the peer to peer lending sector.
Information for borrowers
- Loan periods: from three months to five years (average three years)
- Loan amounts: minimum £50,000; Maximum £1 million
- Average loan interest rate: 12%
Information for lenders
- No fees for lenders
- Loan amounts: Minimum £1,000; no maximum
- Average interest rate (gross yield): 11.06%
- Range of interest rates: No
- Current default rate: Currently zero
Alternatives to peer-to-peer websites
If you're looking for a loan, it's worth checking out Which? Best Rate personal loans too.
And if you're looking for a safe home for your savings, consider putting your money into a Best Rate savings account or cash Isa. If you are content to take a little more of a risk for a potentially higher return, see our guide to investments.
- If you have a savings or borrowing query, call our experts on the Which? Money Helpline
- For alternative ideas, take a look at our guide to saving with a credit union
- Or take a look at our Best Rate cash Isas and savings accounts
