The Traditional Lending Segment to Witness a Remarkable Growth in The Peer-To-Peer Lending Market, Boasting A Substantial Market Share and Projected to Advance at CAGR of 29.3%


Corporations worldwide fund numerous SMEs, which has prompted the FinTech industry to implement online P2P lending. Further, the increased use of smartphones and other mobile devices has encouraged online P2P lending providers to focus more on small- and medium-sized businesses, which is anticipated to create profitable opportunities for the peer-to-peer market’s growth.

New York, United States, Nov. 07, 2023 (GLOBE NEWSWIRE) — Peer-to-peer lending is a system that allows individuals or businesses to obtain loans directly from other individuals or lenders, bypassing financial institutions and the banking industry. Peer-to-peer lending offers secured as well as unsecured loans. However, the majority of loans made through P2P lending are unsecured personal loans.

According to Straits Research, “The global peer-to-peer lending market size is Projected to reach USD 9,76,299 million, registering at a CAGR of 29.9% during the forecast period.” P2P lending solutions don’t require massive workforces, infrastructure, or facilities like traditional banks. Web-based services power the P2P lending platform. These lending platforms make money by charging fees to debtors and deducting expenses from investor loan repayments, which encourages the market’s growth. P2P lending platforms also help reduce operational costs by lowering the cost of physical branches, labor, and branch maintenance, which promotes market expansion. With the help of peer-to-peer lending platforms, investors can reduce various market risks, such as interest rate, unemployment rate, and property price risk, further encouraging global market growth. Additionally, this platform supports effective decision-making, a critical factor in the growth of the peer-to-peer market, by using technology to grade and assign interest rates to loan applicants quickly. Along with the widespread use of smartphones, there has been an increase in internet users worldwide, which has significantly accelerated online lending in recent years and supported the growth of the peer-to-peer market.


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Growth Opportunities

The Chinese know the strategic importance of making capital available for investment in their nation’s economy. Therefore, getting money online is a great idea. Furthermore, it is impractical to increase the number of banks and lending offices to meet the growing financial needs of the nation, given China’s enormous population. Traditional Chinese banks have unusually high-interest rates when compared to alternative lending platforms. Furthermore, when the population’s share of accounts is taken into account, China has lower levels of bank penetration than other developed economies, which ultimately encourages peer-to-peer lending in the nation. Additionally, many SMEs are being funded by corporations globally, which has stimulated the FinTech industry to introduce online P2P lending. Additionally, as more people use smartphones and other mobile devices, online P2P lenders are focusing on lending to small and medium-sized companies, which is expected to generate lucrative opportunities to expand the peer-to-peer market.

Regional Insights

North America will command the market with the largest share while expanding at a CAGR of 26.8%. An increase in online marketplace lending in the United States and a rise in investor and borrower awareness of alternative funding methods are driving the growth of the peer-to-peer lending sector. Due to the public’s growing reliance on online platforms, peer-to-peer lending is also widely used in the region. In North American countries, the end-to-end credit journeys have also undergone a digital revolution, which has contributed to developing a specially tailored and user-friendly lending experience.

Europe will expand at a CAGR of 34.8% and hold USD 2,76,200 million. Because of the increasing number of borrowers and investors in European cities, the market for peer-to-peer lending platforms is growing. The industry is growing due to increased digitalization in banks and financial institutions for selecting qualified borrowers and providing safe loan procedures. Additionally, by streamlining the credit loan application process and encouraging the growth of the peer-to-peer market, the development of alternative online financing in European countries has benefited the FinTech sector.

Key Highlights

  • Based on end-user, the small business loans section is projected to advance at a CAGR of 29% and hold the largest market share.
  • Based on regional analysis, North America will command the market with the largest share while expanding at a CAGR of 26.8%.

Competitive Players in the Market

  1. Avant Inc.
  2. Funding Circle Limited
  3. Kabbage Inc.
  4. Lending Club Corporation
  5. LendingTree, LLC
  6. On Deck Capital, Inc.
  7. Prosper Marketplace Inc.
  8. RateSetter
  9. Social Finance Inc.
  10. Zopa Limited

Market News

  • In 2022, Funding Circle Limited partnered with Pitney Bowes Inc to encourage small business lending. 

Global Peer-to-Peer Lending Market: Segmentation

By Business Model

  • Alternate Marketplace Lending
  • Traditional Lending

By Loan Type

  • Consumer 
  • Business 

By End-User

  • Consumer Credit Loans
  • Small Business Loans
  • Student Loans
  • Real Estate Loans

By Region

  • North America 
  • Europe
  • Asia Pacific 

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About Straits Research Pvt Ltd.

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