Peer-to-peer lending is a type of Crowdfunding, which originates from the USA. Recent financing and investment models show extraordinary growth rates. By now, the German market is the third largest online intermediation market for loans in Europe with € 140 million in 2014. Especially for smaller traders, freelancers or newly founded companies, peer-to-peer lending has become a real alternative to bureaucratic bank financing.


Peer-to-peer lending is the practise of granting loans to capital seekers by a group of people. This is done through special online platforms, which enable contact between capital providers and capital seekers, as well as mediating and managing activities. This enables the possibility of financing projects and objects without the role of a bank as the credit provider. The potential creditors may not have been able to receive funding through other means or they may want to diversify their financing structure. By presenting his project or product on the platform, the credit seeker promotes trust in the investors, so that they can provide him with the necessary funds for a financial consideration. The platforms will do a preliminary credit check of all applicants and allocate credit seekers in corresponding risk classes. In addition to the description of the investment objects, the online platforms also provide information such as the interest rate, the loan term as well as payback details. As soon as sufficient financiers have been found, the loan is paid out.


Peer-to-Peer Lending

The credit platforms connect private capital seekers and financiers. Investors are seeking higher returns than classical financial investments provide due to granting a private loan.

Peer-to-Business Lending

The capital seeker is a company that wants to realize a business project. The project needs to be feasible, as capital providers expect a risk adequate return for their assets. The capital seeker replaces a classical business loan from a financial institution by taking a peer-to-business loan. Through this type of financing entrepreneurs are able to finance new developments, innovative technologies and investments for modernisation and business start-ups.

Social Peer-to-Peer Lending

Social Peer-to-Peer Lending is a special type of financing in which the economic factors are not necessarily the focus of the investment. Instead providing funds for a charitable or nonprofit initiative are considered. The social aspect of the financing prevails, lenders do not receive any form of compensation such as interest, bonuses or any other monetary benefits.


The benefit of peer-to-peer lending for capital seekers lies in the uncomplicated granting of funds. If the capital seekers can convince the crowd of the sense of purpose and profitability of their project, they will be granted a loan even if banks do not consider them creditworthy. Investors may take more interest compared to conventional investments. Associated risks are spread out due to the large number of lenders who provide funds starting from € 25 or more.


Digital credit brokering is a multifaceted sector. In general, simple online credit brokering in Germany does not require approval by the BaFin. Credit seekers and credit providers sign a mutual loan agreement in accordance with the BGB. Any requirements for clarification of the investors by the platform providers are regulated in the German Investment Provisions Act (VermAnlG) and the German Small Investments Act (KASG).

Auxmoney is the market leader in the P2P lending sector. Kapilendo is in a leading position in the financing of German start-ups and medium sized businesses by private investors. Business owners themselves can, for example, invest successfully in the market and raise funds.

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