Who can become a Lender?
LB is a market place for connecting lenders and borrowers – established to benefit both the lenders and borrowers. All the lenders are required to complete their diligence before investing in borrowers
The loanbaba.com P2P portal is a non-traditional lending platform for anyone willing to lend. It is a way of lending wherein the lenders do not have to share the interest incomes with the intermediaries. This portal allows lenders to have a greater control over their money.
A lender at loanbaba.com’s P2P portal needs to be:
An Indian citizen
Over 25 years of age
Have annual income of over Rs. 6 lakhs
Pan card holder
Valid bank accounts in India
Should have invested in fixed deposits, stocks, or other investments using trading or DEMAT account
Interest income less than 30%
Should lend from their surplus income and not borrow for the same
Agrees to adhere to loanbaba.com’s policies and lender code of conduct
List OF DOCUMENTS REQUIRED when you register as a lender
Profile photo Upload
Aadhaar Card/Voter ID
Last year’s Business/Personal ITR or Income Declaration
To whom do lenders lend?
Lenders lend to borrowers registered at loanbaba.com P2P portal. All the borrower profiles are fully verified before they are listed by loanbaba.com. The security checks are done for all the information they provide including, their office and residential address, bank statements, loan records, financial capacity and repayment plans. These borrowers provide varying interest rates to the lenders depending upon their requirement and credit worthiness. Every borrower has a profile, based on their personal, professional, financial, social and educational background that can be assessed by the lender to make an informed decision.
The Process of lending
Once the lenders have logged in, they can identify potential borrowers. Once identified, they can strike a deal with each other. Lenders disburse loans after the borrowers have signed the official loan agreement and provided the lender with post dated cheques for EMI payment. On successful loan disbursals, both, the borrowers and lenders pay an Origination Fee to loanbaba.com, post which there is no further intervention from loanbaba.com. The lenders and borrowers have the freedom to decide the EMI date. If a borrower delays in paying or misses a payment, they pay the penalty directly to the lender (Rs. 200 per day).
The Agreement between the Lender and the Borrower
The lender and borrower sign a contract before they enter into any monetary transaction. It is a legally binding agreement. Each has to get a print-out of the agreement, which is generated online. This hard copy of the agreement then needs to be signed, scanned and uploaded on the portal along with the other documents.
Loanbaba.com charges a listing fee of Rs. 500/- to the lenders. This fee is currently waived off.
Moral code for lenders:
Read and understand the terms, conditions and policies of lending at loanbaba.com P2P portal
Cannot borrow money to lend on this platform
Will honour the agreement with the borrower and with loanbaba.com
Will not harass the borrower during and after the completion of the loan tenure
Will not contact the borrower directly for additional information, loan recovery and verifying credentials
Will go through appropriate legal channels to recover loans if a borrower defaults
loanbaba.com is just a facilitator not a holder of funds, but has stringent policies to protect both the lenders and the borrowers. It is not responsible for the transactions or the decisions taken by any peer. The peers, lenders and borrowers, are responsible for following the rules related to this platform and the laws related to income tax.