What are the risks, and how do we reduce them

There's some risk

Credit Default Risk: LenDenClub Peer to Peer Lending platform puts its best efforts into sourcing the right borrowers, and do thorough underwriting, information verification, and KYC checks. However, there is still a possibility of fraud or credit default risk for the borrower. It’s part and parcel of any lending activity. Here, your money is lent into loans. In a way, it’s a lending activity. Though LenDenClub’s platform’s performance is good, and it delivered good results in the past, it is vital for you to understand the risk involved in the lending. To mitigate this risk, the amount you have lent should be divided into small amounts. On the LenDenClub platform, the capital matching algorithm helps you achieve the same.

Collection Risk: If a borrower does not repay, the platform uses various channels (which follow all RBI-specified guidelines) to recover the funds and ensure you receive your funds back. This includes digital follow-ups, physical meetings with the borrower, and initiating a legal recovery process against the borrower. Based on the loan amount, outstanding amounts, and physical connectivity of the place, the platform decides on the type of collection efforts in the best possible way. Again, because your lending amount are divided into hundreds and thousands of loans, the effect of non-repayment by a particular borrower will be very minimal.

We hate to keep anything hidden. Here are the platform fees you should know about.

Fees

Fees and Charges: To ensure that our P2P lending platform operates effectively and efficiently, while generating good returns for our lenders, a few fees and charges are applicable. Transparency is a key aspect of our service, and therefore, it’s crucial for you to understand these charges and why they are essential for a successful lending experience.

Platform Fee: This fee is charged for the range of services we provide to make lending smooth and hassle-free for you. It covers the costs associated with running the platform for lender-borrower matching, maintenance of a secure and user-friendly platform, and effective customer support. It ensures that we can continue to deliver an efficient and convenient lending experience for you.  It will be charged as usual on the principal portion of each installment and will vary based on the loan tenure.


Recovery Fee:This fee is only applicable on successful repayment of the delinquent loan from the borrower to the lender. The Recovery Fee is levied for the additional efforts our team puts into ensuring that delinquent loans are repaid, including any follow-ups and legal steps that may be required. The fee is a testament to our commitment to go the extra mile to safeguard your lending amount.

Each of these fees contributes to the overall effectiveness of our platform, enabling us to offer you a robust, trustworthy lending service. 

This fee applies only when a loan becomes NPA (90+ days overdue) and a recovery is successfully made.The recovery fee is charged in proportion to your contribution to the loan and varies based on the duration of the overdue period. If no recovery is made, no fee will be charged.

Total Recovery Fee includes:

  • 25% of recovered amount (third-party recovery cost)
  • Additional slab-based recovery fee applies. Click here to know more.


LenDenClub is India’s largest Peer to Peer lending platform which started operations in India in 2015. We have been helping lenders diversify their portfolio beyond traditional investment instruments ever since.

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*Calculated as per the last 6 months’ average returns by lenders who lent for 12 months tenure

LenDenClub, operated by Innofin Solutions Pvt Ltd (ISPL) is registered as a peer-to-peer lending non-banking financial company (“NBFC-P2P”) with the Reserve Bank of India (“RBI”). The Reserve Bank of India does not accept any responsibility for the correctness of any of the statements or representations made or opinions expressed by Innofin Solutions Private Limited, and does not provide any assurance for repayment of the loans lent through its platform.
Registration Number: N-13.02267.

LenDenClub is an Intermediary under the provisions of the Information Technology Act, 2000 and virtually connects lenders and borrowers through its electronic platform via the website and/or mobile app.

The lending transaction is purely between lenders and borrowers at their own discretion, and LenDenClub does not assure loan fulfilment and/or lending simple interest. Also, the information provided on the platform is verified or checked on the best efforts basis without guaranteeing any accuracy of the data/information verification. Any lending decision taken by a lender on the basis of this information is at the discretion of the lender, and LenDenClub does not guarantee that the loan amount will be recovered from the borrower, fully or partially. The risk is entirely on the lender. LenDenClub will not be responsible for the full or partial loss of the principal and/or interest of lenders’ lending amounts.

 

*P2P lending is subject to risks. And lending decisions taken by a lender on the basis of this information are at the discretion of the lender, and LenDenClub does not guarantee that the loan amount will be recovered from the borrower.

CIN: U65990MH2022PTC376689. 

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