What are P2P Lending Returns? An Explainer

Jul 19, 2020
P2P lending, cryptocurrency, borrow bitcoin, bitcoin lending, crypto lending

P2P lending is all rage these days. Both experienced and new investors are enamored by P2P lending. What's the reason that P2P lending is generating so much interest? The answer is quite simple, P2P lending returns are quite attractive when compared to the returns offered by the traditional form of investment options. 

This article discusses P2P lending returns for different platforms but also looks at safer lending options within the crypto industry and how you can get started with those. First of all, let’s compare the different P2P lending offerings.

What's the Average P2P Lending Returns Across all Platforms?

Many of the leading P2P investors have reported annual P2P lending returns above 10 percent. Did it surprise you? I hope not as it's not surprising. Typical P2P lending platforms offer loans to their customers at a rate of 6 percent to 36 percent. 

There is also an option to earn double-digit P2P lending returns too. If an investor opts for a portfolio of blender credit grades, they can easily earn P2P lending returns that are over double digits. The investor is likely to earn such a high interest even after they factor in the 1% management fee along with a few loan defaults in a financial year. 

Let's explore some of the popular platforms to know more about the average P2P lending returns. The following are the names of the leading platforms along with the average P2P lending returns offered by them. 

Bondora – 6.75%

Viventor – 15.51%

Bulkestate – 14.75%

iFunded – 5%

Mintos – 11.42%

October – 7.12%

Crowdestate – 11.73%

Reinvest24 – 8.01%

Points to Keep in Mind When it Comes to P2P Lending Returns 

There are some important points that you must keep in mind before you start calculating P2P lending returns. Tax is the most important point that you must always factor in to calculate your returns. Otherwise, the P2P lending returns that you will calculate won't be the real returns that you received on your investments. The taxes are something that entirely depends upon the country of your residence. 

There is no doubt that the attractive P2P lending return is a reason enough to invest through the P2P lending platforms. However, we must not forget the associated risks with these platforms. When investing in P2P lending, you must only invest the amount that you can afford to lose. It must not be such a high amount, that it will lead to disastrous consequences if your investment is lost. 

Alternatives of P2P Lending With Similarly High Returns?

Are there any other investment options that offer easy access to an average person and provide pretty high returns at the same time? There are none, as P2P lending platforms are second to none in terms of offering a higher rate of returns to the investors. 

If we talk about the subtypes of P2P lending that offer the highest returns, then yes, there is an option. It is even better than the fiat P2P lending as it offers better P2P lending returns compared to the fiat option. So, which investment option I am talking about? I am talking about Crypto P2P lending. Let's explore why crypto P2P lending is better compared to the fiat P2P lending option. 

Why Crypto-based P2P Lending is Better Than Fiat P2P Lending?

Both cryptocurrencies and P2P lending are like new kids on the block in the world of fintech. Yet, both share common objectives and complement each other's features. 

Crypto-based P2P lending is better than the fiat P2P lending in many ways. The entire Crypto-based P2P lending process is far more seamless for an example. The process of lending also takes a lot less time when compared to the general P2P lending process. 

The fiat-based P2P platforms do require any collateral from a borrower to borrow from them. Hence, an investor may also lose their money if the fiat platform lends their money to a borrower and the borrower defaults on their loan. This is not the case with the crypto P2P lending

A borrower must collateralize their crypto holdings to borrow money from crypto-based P2P lending platforms. The crypto P2P lending platform is free to seize the crypto assets of the borrower in case of a default and liquidate them to return the investor's money to them. 

The rise of crypto P2P lending has created a system of trust and has minimized overhead costs drastically. It has unlocked the next step of the P2P growth and has brought in many advantages for the end customers. Crypto P2P lending platforms have also proved to be quite successful in terms of attracting younger customers as their lending terms are quite flexible and they do have stringent vetting criteria. 


Every type of investment instrument has both pros and cons to it. An investor must invest in multiple options to spread the risk. As the saying goes, "Do Not Put All Your Eggs in One Basket."

We suggest investing regularly in crypto P2P lending platforms. However, it should not exceed the amount that you cannot afford to lose. There's a lot to gain when investing through the crypto P2P route but there's a lot to lose too. Yet, we believe that crypto P2P investment has a lot to offer to the P2P believers and crypto community. 

Want to learn more about taking a loan out with YouHodler? Or want to get started with earning interest by providing loans? We’ve got you covered with our crypto loans and savings account offering.

Get YouHodler Crypto Wallet App

An efficient and innovative tool powered by crypto-backed loans to help you capitalize on market volatility

YouHodler is regulated in  Switzerland and the EU

Partnership with regulated EU/Swiss payment providers

YouHodler S.A. Regulated Financial Intermediary and Pawn Broker

YouHodler Italy S.R.L. OAM Registration

VASP Registration wth the Bank of Spain