Exploring the Path to Digital Lending Opportunity for Lenders and Borrowers

traditional lending vs alternative financing 1

Digital lending is the future of personal and business financing as it offers flexibility and comfort that are not available with traditional banking institutions. Considering this, it is no surprise that global digital lending is expected to grow from USD 5.1 billion in 2018 to USD 12.1 billion by 2023.

Financing methods in the 21st century

One of the most recognizable features of digital banking is the mobility it offers to both lenders and borrowers. While most traditional banks require you to visit their office at least once in a while, digital lending services pride themselves with a completely mobile structure, which allows customers to do banking on the go. The fact that all of these services are based on online platforms also means that customers won’t have to deal with excruciating amounts of paperwork.

AssetStream is a microfinancing platform riding the wave of popularity which digital financing is currently experiencing. Their peer-to-peer structure allows borrowers to connect directly with lenders and thus, the amount of taxes and additional charges for both sides are decreased considerably.

AssetStream also offers extensive information on basic financial concepts and practices to educate their customers and allow them to be part of the process. By 2020, the platform aims to have created a detailed educational guide in order to help both borrowers and lenders to steer clear from making bad decisions regarding their finances.

Access to financing and information is a crucial advantage offered by digital lenders, but not by traditional banks.

But is digital lending secure?

One of the main concerns potential customers have when they are first introduced to digital lending is security. However, it is a myth that if you carry out your financial operations through a digital provider they are at risk of being hacked.

In fact, platforms like AssetStream are more secure because they are built on the blockchain, which allows zero interference from outside sources. Loan terms are on smart contracts, which means that only the lender and the borrower have access to their agreement.

AssetStream also provides a detailed financial profile of both borrowers and lenders, so that both sides are aware of the background of the other. This adds a layer of security and helps build the trust between the two parties involved in the lending process.

As with traditional lending, there are certain risks for lenders when they give their money on credit. AssetStream protects lenders against possible non-performing loans. Thus, if a borrower is not paying the agreed installments, AssetStream will invoke the powers of local laws to invite the borrower to clear their debt.

Choosing to go down the path of digital lending is choosing the future

Digital lending is predicted to play a central role in the financing world from now on. Digital lending is clearly the future of financing, so the sooner you decide to join, the better you will be at keeping up with the trends.

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