P2P Lending for payday loans?

Discuss all general (i.e. non-personal) investing questions and issues, investing news, and theory.
Post Reply
Topic Author
gsartois
Posts: 2
Joined: Fri Jan 11, 2019 10:34 pm

P2P Lending for payday loans?

Post by gsartois » Fri Jan 11, 2019 10:39 pm

I'm just getting back into the peer-to-peer lending space and saw that there are a few platforms offering a p2p market for payday loans. Has anybody tried this out yet? How have your returns been? Pros, cons? I would appreciate any feedback.

Thank you so much :)

mhalley
Posts: 6518
Joined: Tue Nov 20, 2007 6:02 am

Re: P2P Lending for payday loans?

Post by mhalley » Fri Jan 11, 2019 10:59 pm

I would imagine those types of loans are very risky.
https://www.ibtimes.com/payday-loans-st ... ns-1864480

User avatar
willthrill81
Posts: 7290
Joined: Thu Jan 26, 2017 3:17 pm
Location: USA

Re: P2P Lending for payday loans?

Post by willthrill81 » Fri Jan 11, 2019 11:11 pm

As a lender, I wouldn't touch them with a 10 foot pole.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

Topic Author
gsartois
Posts: 2
Joined: Fri Jan 11, 2019 10:34 pm

Re: P2P Lending for payday loans?

Post by gsartois » Fri Jan 11, 2019 11:17 pm

Haha, but not a 39 and a half foot pole?

My concern is mostly with the default rate. From what I gather, the reason the interest rates are so high on these loans is that the default rate is around 20 to 40%. When almost half of your borrower aren't paying back your APR is going to be ridiculous. That said, there are still a ton of large even publicly traded companes (CSH & EZPW) that must make some profit in the industry otherwise they wouldn't be around anymore.

For reference, this was the post I had stumbled upon: https://budgetandthebees.com/new-horizo ... e-lending/

Post Reply