How to Create a Peer-to-Peer Money Lending App? | Eastern Peak

Understanding P2P money lending apps

How a P2P lending app works

Pros & Cons of using P2P lending platforms

Convenience and cost-effectiveness

Favorable rates

Tailored loan conditions

Multiple customers for a single lender

Safety and trust

Limited accessibility

Loan amounts are lower

Debt collectors are still there

The main types of P2P loans

  • Personal loans. Personal loans from private individuals are a widespread type of peer-to-peer money lending, as it has fewer restrictions, lower rates, and requires less application paperwork. These loans cover a wide range of needs for common people, from different types of bills and purchases to debt consolidation.
  • Business loans. Some P2P lending apps invite companies to become a borrowing party. It’s a more complicated process than individual on-demand money lending because you need to prove the credibility and prospects of your business. For that reason, startups have fewer chances of receiving peer-to-peer loans.
  • Home loans. People often need loans to buy a property or furnish it. Some of them prefer adaptable online lending options, with the interest rates calculated based on the borrower’s paying capacity.
  • Car loans. Vehicles are arguably as demanded as real estate which makes car loans a common request. Car P2P money lending works similarly to home loans, just the interest rates may be higher.
  • Educational loans. Students pay for higher education, and it’s often the case that they can’t afford their dream college or university because of exorbitant costs. That’s when P2P money lending platforms come into play and help make the students’ dreams come true.
  • Medical loans. Medical insurance is essential for healthcare yet unaffordable or burdening for many citizens. That is why some P2P lending apps include this type of loan into their service spectrum.

Examples of peer-to-peer lending apps

Payoff

Upstart

Peerform

Upgrade

Prosper

How to create a money lending app

1. Do market research

2. Security and legal compliance

  1. Authentication. Identity verification protects users’ personal data. Luckily, developers possess a huge choice for authentication methods, from passwords and 2-factor authentication to face recognition and fingerprint scanning.
  2. Encryption. On P2P lending platforms, data encryption is vital. Use only secure server connections and leverage all tools and means to avoid data breaches and other privacy issues.
  3. Legal compliance. Besides technical matters, regulatory aspects are highly important for apps that contain users’ sensitive information and mediate money transactions. Make sure you know global and local laws and comply with them.

3. Choose a business model

4. Must-have and additional features

  • Registration form. It’s the first step your potential clients make after app installation. It’s important to make the registration process fast and simple. Consider adding a possibility to sign up with social media accounts or a phone number.
  • Personal profile. On this page, users can edit personal data or add more information about them or even track their in-app activities. Design it clearly, so users can navigate intuitively.
  • Loan application. This tab is the heart of a loan app. First-time users would highly appreciate a brief guide on the basic functions and possibilities of the loan application procedure.
  • Loan calculator. Automated loan calculation simplifies the process of choosing the most appropriate lender. Potential borrowers don’t need to count monthly payment amounts, interest rates, and other crucial points on their own.
  • Payment tab. This section lets users track their payments and commitments. Also, make sure you have multiple payment and withdrawal options to satisfy a broader audience.
  • Payment schedule. The feature breaks down a loan amount into yearly, monthly, or weekly payments. So, the borrower gets a payment plan that helps design the budget.
  • Notifications. While in many other apps this function can be optional, it’s essential for peer-to-peer lending platforms. Users need to pay off the loan on time, so it’s better to notify them a couple of days before the upcoming payment.
  • Credit score. In many peer-to-peer lending websites, lenders consider the borrower’s credit history before they decide to provide them with a loan, so it’s an important metric for such services. Connect your loan app to a credit score service to help users track their creditworthiness.
  • Ratings. It’s kind of a reward for users who meet their loan obligations reliably and in due time. Just like credit score, the higher your ranking, the more chances you have of finding a loan partner.
  • Chatbot and live chat support. Your app should be as comprehensible as possible, but some users may still want to get some assistance. Make sure they can reach out to a human or bot for help.
  • Geolocation. If your app has a payment option that allows the use of ATMs, the geolocation feature can help users find the nearest spot.
  • AI-based analytics. This feature provides quality real-time analysis of in-app activity. Users can get additional info about potential lenders and borrowers. App admins use AI-based analytics to get an insight into the app usage and user experience to further improve the app.

5. APIs integration

6. UX/UI

7. Develop an MVP

8. Gather user feedback and scale the app

Summing up

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Eastern Peak is a custom software development company which possesses deep expertise in working with startups and building intuitive mobile apps from ground up.

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Eastern Peak

Eastern Peak

Eastern Peak is a custom software development company which possesses deep expertise in working with startups and building intuitive mobile apps from ground up.

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