What does P2P finance mean? What is the difference with traditional finance?

One, P2P finance:

This refers to the small amount of borrowing and lending transactions between different network nodes, which need to use the e-commerce professional network platform to help borrowers and lenders to establish borrowing and lending relationships and complete the relevant transaction procedures. Borrowers can release their own borrowing information, including the amount, interest, repayment methods and time, and decide on their own lending amount to realize self-help borrowing.

The difference between P2P financial model and traditional finance.

1, P2P is a very effective financial channel, which provides a large amount of information, the threshold of entry is low.

And the traditional investment and financing channels have too high a threshold, so that individuals and weak small and medium-sized enterprises can not meet their financial needs through it.

2, P2P operation process is simple, low cost.

And the traditional financial model of the operation process is complex, high cost, which is why the traditional financial model is rarely involved in microfinance.

3, P2P model of high transparency.

Through some online lending platforms, lenders and borrowers can know each other's identity and credit information, and lenders are able to keep abreast of borrowers' repayment progress and living conditions.

While the traditional financial model has lower information transparency and only one-sided borrowers, the interest rate is unilaterally set, there is no opportunity for negotiation.

Expanded information:

p2p financial model and the traditional financial similarities:

< p>1, are used as a financial medium to meet the borrowing and lending double hair for the demand for funds.

2, the occurrence of lending and borrowing business are risky. p2p financial risk compared to the traditional banking model is more risky, weak regulation.

3, P2P financial model and traditional financial model in negotiating a business will analyze the borrower's credit.

Baidu Encyclopedia-P2P Finance

Baidu Encyclopedia-Traditional Finance