P2P lending

: here to stay or flash in the pan?

Abstract

This thesis examines peer-to-peer (P2P) lending as an alternative to traditional banking services and analyzes its potential for individual investors and borrowers. Increasing digitalization and technological progress have significantly changed the financial industry, resulting in the emergence of P2P lending as an innovative form of financing. Through a combination of expert interviews, quantitative survey data and a comprehensive literature review, the study explores the competitive advantages, challenges and risks of P2P lending compared to traditional banking. The findings indicate that P2P lending is currently acting as both a complement and a competitor to banks, especially for specific customer groups and market segments. The analysis highlights that P2P platforms have advantages due to their flexibility and speed of lending, but have weaknesses compared to banks in the areas of trust, transparency and regulation. While P2P loans often have higher interest rates and risks, they still offer an important source of financing for borrowers who are not served by traditional banks. In conclusion, it is recommended that P2P platforms should improve their transparency and security measures in order to strengthen user confidence and increase their competitiveness. At the same time, the potential of P2P lending as a dynamic and innovative part of the financial market is highlighted.

Date of Award	10 Feb 2025
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Peter V. Rajsingh (Supervisor)