In a recent interview with Finbold, NEO Finance founder and Chairman of the board, Mr. Evaldas Remeikis, talked about P2P platforms and traditional banks' relationship. He noted that the P2P industry has grown to offer competitive products to customers just like traditional banks.

NEO Finance is a Lithuanian based Peer to Peer lending company.

With the coronavirus pandemic significantly impacting the global economy and businesses, Mr.Evaldas explained how the crisis affected P2P operations. The NEO Finance founder explained how new and experienced customers reacted to the pandemic from his personal experience. According to Mr.Evaldas: “First of all, it should be noted that the most loyal investors have been able to shop very profitably in the secondary market, while less experienced investors started panicking and selling off their investments into loans”.

On future growth, Mr. Evaldas believes that investors will keep shopping around for businesses that pose less risk, with NEO Finance best positioned to reap. He explained that: "We should expect to continue seeing a growing number of investors until the annual returns reach 4-5%, as investors continue to “migrate” to platforms where the return-to-risk ratio is best, and the NEO Finance platform has really great potential in this regard."

Increase in the number of investors amid health crisis

Amid the pandemic, most investors were uncertain about putting their money in different businesses, especially during the first and second quarter of 2020. During the interview, Mr. Evaldas highlighted how investors had shown faith in the sector despite lingering uncertainty. He revealed that: "Considering the uncertainty surrounding the Covid-19 situation, I would say that the fact that investors still trust the P2P platform is a good result. There was a particularly high increase in the number of investors in the second half of 2020".

During the session, Mr. Evaldas also highlighted the drivers for P2P sector growth in recent years. At the same time, he talked about advancement in the P2P industry to shake off some of the initial perceptions. He states that: “P2P platforms are now actively competing for borrowers with banks and balance sheet lenders. We can offer attractive terms to the customers of both banks and other lenders, and although we have heard the story that P2P platforms are only useful for customers who do not qualify for bank loans, we can say this is definitely not true. Those times are long over – in fact, I would say this stage ended in 2017. Since that time, the platforms have grown, became stronger and now have a powerful money supply thanks to a large number of investors.”

He added that there is a possibility of traditional banks partnering with P2P platforms after realizing the opportunity they present. Mr. Evaldas projected that: "We may see an emergence of banks or other institutional investors who have recognized the trend for developing platforms and decide to become partners, to lend their capital through the platform while acquiring a significant stake in the process."

Read the full interview here: https://finbold.com/neo-finance-founder-p2p-platforms-are-now-actively-competing-for-borrowers-with-banks/.