Peer-to-peer investment is a good alternative to other traditional investment methods, when the two are compared, peer-to-peer platforms come forward as a better option as it deals with two issues in particular:
- If saving rates are low, private investors/lenders would rather choose a high-returns product
- For supporting fund deals and grow businesses, and borrowers need money
Should one invest in P2P lending? Let’s compare p2p with bank finance.
How does P2P compare to bank finance?
Compared with traditional financial products, what are the advantages and disadvantages of P2P? It can be said that the positioning of P2P financial management is the high rate of return for customers, but stability is the main goal of bank financial management. They are suitable for different types of investors.
1. Earnings Yield:
At present, the average return of bank products is about 4.5%, but the P2P yield is about 8% -9% or even more than 10%. The gap is still relatively large. If calculated on a one-year cycle, $ 5,000 is separately invested in bank products and P2P products. After expired, the interest of them is respectively about $ 5,200 and $ 5,500.
Bank financial management products are mainly divided into two categories: fixed income products and floating income products, which have always been considered as more secure financial management methods. Because the products are managed by bank professionals through diversified investments, hedging, and others. With the premise of ensuring the safety of funds, the operation has been perfected. Most people think that the approval of the national bank is very strict, and applicants need to have a good reputation. And P2P just came out shortly, it can be said that the security is far less than bank financial products. If your goal is a stable, fixed rate of return, in addition to buying bank-owned products, unstructured products are your other choice.
3.Professional and Objective：
Whether investing in the P2P platform, it is determined by the subjective judgment and objective basis of the user. The P2P platform is an online lending information intermediary platform, so there are no marketing or mandatory financial products.
Different people have different choices. It is recommended to combine actual conditions, make reasonable investments, and plan financial management. Finally, find out your investment positioning, recognize the core pursuit of yourself, and use various financial management tools carefully.