Can You Make Money With Peer-to-Peer (P2P) Lending in 2023?

Can you make money with P2P lending

If you’ve been looking for ways to make money with passive income, you may have heard of peer-to-peer (P2P) lending. But can you make money with P2P lending?

The truth is, P2P lending can be a great way to generate income, but it’s not without risks. Before jumping in, it’s essential to understand what peer-to-peer lending is, how it works, and the potential risks and rewards involved.

What is Peer-to-Peer lending?

Peer-to-peer lending is a form of financing where investors (or “lenders”) provide money to borrowers through an online platform. The lenders are typically individuals or groups of individuals who are looking to earn a return on their money. The borrowers are typically individuals or small businesses who are looking to borrow money for a specific purpose.

The P2P platform acts as a middleman, connecting lenders with borrowers and facilitating the loan agreement. The platform also handles loan servicing, collecting payments from the borrower, and distributing them to the lender.

How much money can you make with P2P lending?

The amount of money you can make with peer-to-peer (P2P) lending depends on several factors, including the type of loan you offer, the interest rates you charge, and the risk of default you are willing to take on. Generally, P2P lending offers a higher return than traditional banking and investing options, but there is still a risk of default.

According to data from our website, the average return on P2P lending in Europe is around 8-15%, while in the United States, it is closer to 7-8%. However, these are just averages and you can make much more if you are willing to take on higher-risk loans.

The most important factor to consider when making money with P2P lending is the amount of risk you are willing to take on. Lower-risk loans tend to offer lower returns, while higher-risk loans can offer higher returns. The key is to find the right balance between risk and reward that works for you.

When it comes to setting interest rates, it is important to factor in the risks associated with the loan. If you are lending to someone with a low credit score, for example, you may want to charge a higher interest rate to compensate for the risk of default. On the other hand, if you are lending to someone with a higher credit score, you may be able to charge a lower interest rate.

Finally, it is important to remember that P2P lending is not a get-rich-quick scheme. It is a long-term investment that requires patience and diligence in order to benefit from the returns. So if you are looking to make money quickly, P2P lending may not be the right option for you.

How can you make money with P2P lending?

The primary way that investors make money with P2P lending is through the interest payments they receive from the borrowers. Most P2P lending platforms offer a variety of loan options, with different interest rates and repayment terms. Investors can select the loan options that they feel offer the best potential return.

You will first need to decide how much money you want to invest. With P2P lending, you can invest as little as €1 or nearly as much as you would like. The amount you can invest will depend on the lending platform you use and the risk you’re willing to take. You’ll need to decide what level of risk you’re comfortable with, as higher-risk investments tend to bring higher returns.

After you’ve decided how much you want to invest, it’s time to find a P2P lending platform. There are a number of reputable platforms you can use, such as Lendermarket, PeerBerry, and Esketit. Each of these platforms has different rules and requirements for investors, so it’s important to read the terms and conditions before you commit your money.

Once you’ve chosen your platform, you’ll need to fund your account. Most platforms accept payments via credit card or bank transfer, and you’ll need to make sure that you have sufficient funds available to make your investments.

Finally, you can start to invest in loans. Each platform will give you a list of loans to choose from, and you can select those that fit your criteria. You’ll need to look at the borrower’s credit score, loan purpose, and other factors to decide whether or not you want to invest. Once you’ve chosen a loan, you’ll have to transfer the funds to the platform and wait for your return.

Making money with P2P lending can be a great way to diversify your income and put your money to work. As with any investment, it’s important to do your research and understand the risks before investing. With the right platform, the right investments, and a bit of patience, you can make a good return on your investments.

What are the risks involved?

As with any investment, there are risks associated with P2P lending. The primary risk is the potential for default. If a borrower fails to make their payments, the lender may not receive the full amount of their loan. This can significantly reduce the potential return on the investment.

In addition, some P2P platforms may charge additional fees or have minimum investment requirements. This can further reduce the potential return on investment.

P2P lending is also not insured. This means that if the platform goes out of business, investors may be unable to recoup their invested funds.


Peer-to-peer lending can be a great way to generate income, but it’s important to understand the risks involved. Before investing, it’s important to carefully research the platform and the loan options available. With the right strategy, P2P lending can be a great way to earn a passive income.