'P2P model is a solution for many small businesses'

By Sangeet Modi

NBFC-P2P provides a pool of opportunities to both the lenders and the borrowers to engage in business. P2P model is a solution for many small businesses that are struggling for funds. Digital lending has changed the face of many developing countries’ economies because of the transparent environment and paperless approvals.

So, from the perspective of Peer-to-Peer (P2P) industry in India, it has tremendous opportunities because this industry is still at a nascent stage and requires encouragement through tax benefits.

Tax benefits can be provided on the interest income from peer-to-peer (P2P) lending business that will encourage investors to invest in this business. We also demand relaxation in norms to allow NRIs to be lenders on the platform and the interest income should be repatriable.

At this point, bad Loans are not good for the health of P2P industry and should be allowed to be adjusted against the interest income through P2P until the industry has settled in. It’s not only about business but a P2P lending revolution can help Financial Inclusion to a great extent.

The author is Co-Founder & Director at IndiaMoneyMart