Types of Crowdlending

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Types of Crowdlending are classified based on who the individuals are financing, whether it is a company or a natural person. Let's see below what types of Crowdlending exist so that you can determine which one you can benefit from based on the type of investment:

P2P Crowdlending
On the one hand, we have loans to individuals (peer to peer or P2P) which hungary phone number list of financing consumer loans to individuals (mortgage loans are prohibited in Spain). It is called peer to peer since it involves individuals financing other individuals in exchange for a return.

In P2P crowdlending, the rates of return offered are usually higher, which is attractive to some investors. However, as with any investment, the higher the return, the higher the risk, so P2P represents a higher risk for individuals as they are financing other individuals rather than companies.



P2B Crowdlending
On the other hand, there are loans to companies (peer to business or P2B) which are the model through which individuals finance SME projects and ventures under the following three modalities:

Business loan: Basically a consumer loan for companies that need liquidity or working capital.
Real estate crowdlending: Private financing is aimed at the construction and subsequent sale of properties. It is not the same as real estate crowdfunding, where the purchased property belongs to the investors. In real estate crowdlending, the money is lent to the real estate developer.
Factoring or promissory notes: In this type of Crowdlending, money is advanced to a company that has promissory notes or a discount on an invoice, which guarantees payment of said invoice. Let's look at a variant of crowdlending to companies and factoring, crowdfactoring.