New Year’s Resolution: Start Investing with FinClub

If you are a peer-to-peer lender or have thought about becoming one in a professional capacity by teaming up with FinClub, kudos to you for prioritising your future. Getting started with Peer to Peer (P2P) Lending is easy. Below are some great tips to keep in mind to make sure you are doing everything right:

1.??????Start slow

If you’re just getting started with P2P lending as an investment tool, take it slow. Reading and research are great, but there is no better teacher than the first-hand experience.

Don’t feel like you need to rush and lend large amounts of money. Take advantage of the opportunity to lend smaller amounts, even MUR 1,000 per loan. Having a smaller amount invested at the beginning will give you time to understand the lending platform and prevent yourself from making costly mistakes.

2.??????Know your risk tolerance

Everyone has a risk level they’re comfortable with. You need to know yours before you begin investing. As with all investments, the higher risk usually equals a higher reward. Lending to a low-grade borrower will bring in potentially higher yields but greater risk than lending to a high-grade borrower. Think carefully about how much risk you are prepared to take.

3.??????Diversify your loans

If you want to minimize the risk of defaults and protect your investments, aim to invest in at least 100 different loans. If your money is diversified across hundreds or thousands of loans, your profits are likely to be higher than your defaults.

4.??????Reinvest your returns

Do not cash out your P2P returns straightaway. Take advantage of the compounding returns by continually reinvesting your returns into new loans.

5.??????Use automation to reinvest

Keeping your principal and interest fully invested is the best way to make the most of your investments. If you have to decide about every MUR 1,000 investment manually, P2P lending won’t be worth your time. Without automation, it’s a hassle to keep every bit of money constantly reinvested.

Make use of FinSmart, our automation investment tool, and let the lending platform do the dirty work for you.

6.??????Keep a strong emergency fund

Before you become a P2P lender, make sure that you have a strong emergency fund that can cover your own personal expenses. You won’t be able to withdraw money from the P2P platform on a whim.

Start your P2P investment journey with us now! Click here to register for free.

For more info, please contact us on 468 7400 or 5255 7413