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P2P Lending (RBI NBFC-P2P)
Clears the 12% forward-return floor — eligible for optimizer by default.
P2P lending — critical caveat
- Advertised 10-18% is gross/pre-default marketing — not net return.
- RBI (Aug-2024) banned assured-return marketing, credit guarantees, secondary-market liquidity.
- Lender bears 100% of default loss. No deposit insurance. No SEBI protection.
- Illiquid — locked until each loan repays. No secondary market.
- Slab-taxed (no LTCG benefit).
- Realistic net: 6-10%. RBI publishes no official NPA series; inferred 4-12%.
- Caps: ₹50L aggregate across all P2P platforms, ₹50k per borrower.
- Recent enforcement: LenDenClub ₹1.99Cr fine, NDX ₹1.92Cr fine.
RBI-registered NBFC-P2P platforms
Verify current RBI-registered NBFC-P2P status before funding — some wallet "Xtra"-style products were restructured after the Aug-2024 crackdown. Spread across borrowers (RBI caps ₹50k per borrower, ₹50L aggregate across all platforms).
- LenDenClub — adv ~12% · net ~8.6% (one verified lender got ~1%) · ₹1.99Cr RBI fine
- IndiaP2P — adv up to 18% · net ~15-17% only at ~zero NPA · NPA self-reported
- Faircent — adv 12-24% · no verified net · ₹40L RBI fine
- i2iFunding — adv up to 36% · net ~13% (pre-2024) · protection fund killed by RBI
- Finzy — adv 11-16% · net ~13% · ₹10L RBI fine
- Lendbox — adv 10-14% · net ~7-8% (high-yield NPA ~9.75%)
- Monexo — adv 13-20% · net ~7-11% · possible licence cancellation
- RupeeCircle — adv ~25% · net mid-single/low-double, can go negative
- Cashkumar — adv 11-24% · net ~4-8%
- LiquiLoans — adv 10-12% · net 7.5-10% · PAUSED new lending · ₹1.92Cr fine
- IndiaMoneyMart — adv 12-25% · no audited data (opaque)
Wallet products — NOT real P2P (backend is someone else's licence)
- 12% Club (BharatPe) — backend LenDenClub+LiquiLoans · deposits HALTED
- MobiKwik Xtra — backend Lendbox · withdrawal FREEZE, police cases
- CRED Mint — backend LiquiLoans · net ~7-9%
- Fello — backend Lendbox · double-intermediation risk
Verdict: advertised rates (11-36%) are gross, zero-default, pre-fee, pre-tax marketing ceilings. Realistic net clusters 7-13% in good years, NEGATIVE in bad ones. No audited platform supports a durable 20%. Nearly every major platform has been RBI-fined or show-caused; wallet products have frozen withdrawals. Size small, money you can lock up and afford to lose.
Risk notes
ASSUMPTION: 20% is the return YOU have realized so far — a track record, not a guarantee. Reality check stands: advertised/realized 20% is PRE the next default cycle. RBI (Aug-2024) BANNED assured-return marketing, credit guarantees, secondary-market liquidity. Lender bears 100% of default loss; unsecured; NO liquidity; NO deposit guarantee; slab-taxed (no LTCG — a 20% gross is ~14% net at 30% slab). Independent research puts diversified net at ~6-10% across a full cycle. Vol shown low (0.06) DRAMATICALLY understates tail risk: P2P risk is sudden mass default + being locked in, not price wobble. At 20% return + 0.06 vol the optimizer will over-concentrate here — this is the model's blind spot, not a real free lunch. CAP THIS SLEEVE.
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