Traditional lending practices are inefficient in today’s fast-paced business world. The federal regulations designed to protect consumers shut out small businesses while dragging out the lending process for qualified consumers. Online lending platforms address the need for diverse and efficient funding access. Borrowers can connect with the right lenders by identifying which type of lending marketplace best suits their needs.
Targeting by Industry
Online lending marketplaces offer matchmaking services by industry. These niche platforms exist to better serve the needs of their consumers. An independent filmmaker that would never have their movie project financed by a traditional bank can turn to crowdsourcing on an open-ended platform, like Kickstarter. The real estate industry is serviced by platforms based on industry segmentation. For instance, RealAtom specializes in commercial real estate debt, connecting borrowers and lenders. Other online platforms serve the market for single-family home investors, retail developments, and residential lending.
Platforms by Funding Type
Thanks to online marketplaces, lenders can save their time working exclusively with borrowers seeking their specific funding type. More online platforms specialize in distinct types of lending, like credit lines, bridge loans, private capital, and others. Should a marketplace offer several loan types, lenders can program searches to identify funding opportunities that match their specific criteria. These focused platforms help borrowers sort through the numerous funding sources to identify the potential lenders that match the deal they want to execute. A business seeking a quick cash advance can go directly to a cash advance lending platform.
Marketplaces by Amount
Traditional lenders typically target large-money transactions. After all, a 10-year 2% APR loan of $2 million will earn more over its lifetime than the same loan terms on $100,000. An online marketplace can match lenders seeking those large amounts with borrowers requiring significant capital. What about when a borrower needs a small sum to cover an emergency? Online lending marketplaces are making that connection. By creating platforms specializing in amount, marketplaces match investors willing to deal in reduced increments with the borrowers in need.
Online lending platforms’ capacity to connect diverse lenders and borrowers is transforming the financial industry. Borrowers appreciate the efficiency behind submitting one application package that is shopped to multiple qualified borrowers. Receiving the right terms to fit their needs and securing quick access to necessary capital is a huge benefit to using an online marketplace. For lenders, the ability to source potential qualified leads without spending hours sorting through unqualified borrowers inquiries improves their business efficiency.