The Future of Peer-to-Peer Lending in Germany: Trends and Outlook for 2023 and Beyond

Peer-to-peer lending, also known as marketplace lending, continues to grow. The following trends can be seen in Germany for the year 2023 and beyond:

• The transaction volume is getting loud gutekredit.de and Statista are expected to reach 31.32 billion euros
• The average funding per loan is around 610,000 euros
• Annual growth is estimated at 1.42% for the following years
• By 2027, the transaction volume will amount to 33.14 billion euros

The providers

There is an increasing number of platforms facilitating P2P lending. This makes choosing the right provider very important for both borrowers and lenders. These can be compared in a relatively short time via reviews and rating portals. For example, a look at the Ferratum credit experiences important information about the advantages and disadvantages of this provider is clearly available.

While on many platforms, such as cashcape, generally about the provision of finance as loans, other providers specialize in niche markets. These include loans for small businesses or for students.

The background to growth

The growth in P2P lending can be attributed to a number of factors, but by far the most significant is the need for alternative funding sources. This is especially true from the perspective of borrowers who need funding but are not eligible for a bank loan.

But using a P2P loan is also interesting for borrowers who are definitely qualified for a bank loan. This is due to the fact that with a good credit rating, more favorable conditions and, above all, lower interest rates are often waiting for you.

For investors, in turn, P2P lending offers opportunities to generate higher returns than other forms of investment. This leads to the surprising development that institutional investors are now becoming increasingly involved in this area.

The trend towards more institutional investors than the primary lenders is also related to the fact that the demand for the loans themselves has changed. While smaller sums used to be in the foreground, now the importance of larger loans is also increasing. The associated sums can be served more easily by this group of investors.

The importance of technology is also increasing significantly in this area. Online platforms allow to find borrowers and investors and it simplifies the lending process. With the trend towards more and more digital platforms, an increasing need for loans from small and medium-sized companies and the overall demand for alternative financing options, the market can be expected to continue growing.

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