How to mitigate risks when investing with Peer-to-Peer financing (P2P)

For small and medium-sized enterprises (SMEs), access to financing is often seen as a one-stop solution for growth. Many banks, fintech lenders, and government programs promote SME financing as a universal remedy, offering standardised loan products and financial packages. However, the reality is that not all businesses have the same financial needs, challenges, or growth trajectories . The idea that a single SME loan structure can suit all businesses is a myth. This blog will explore why SMEs need a custom financing approach , the limitations of generic loan options, and how businesses can find financing tailored to their unique needs. 1. The Problem with Standardized SME Financing A. Every SME Has a Different Cash Flow Cycle A restaurant, an e-commerce business, and a manufacturing firm all operate under very different revenue models. While one might have daily cash inflows, another might depend on large orders paid every few months. A standardised business loan in Malaysia with f...

  Securing the right business loan is a crucial step for any small or medium-sized enterprise (SME) looking to expand, manage cash flow, or invest in new opportunities. However, with various financing options available, selecting the best one can be overwhelming. Whether you are seeking SME financing for working capital, asset acquisition, or business growth, it’s essential to understand your options. Understanding SME Financing Options When it comes to SME financing , traditional banks and alternative lenders offer different types of business financing solutions. Here’s a breakdown of the common options available: 1. Traditional Business Loans Banks and financial institutions provide standard business loans , typically requiring collateral, a strong credit history, and a lengthy approval process. While these loans often come with lower interest rates, they may not be the best option for SMEs needing quick access to funds. 2. Government-Backed SME Loans In many countries, inclu...

 Have you ever heard of an investment product that provides positive returns without having any risk involved at all? Well, we all know the answer – it’s a big “NO”. Unfortunately, every investment platform and product comes with its own risks, as returns earned are a reward for risk borne. The returns for investment assets such as stocks and equities fluctuate every day, with a mix of good and bad days accumulating to form the returns over time. However, investment products with fixed returns such as fixed deposits, bonds, and Peer-to-Peer financing (P2P) help to mitigate the risk of volatile returns. As P2P financing continues to grow in Malaysia , we have identified the risks and proposed potential solutions in order to assist Malaysians to safely and successfully invest via P2P. Let’s dig deeper and find out how we can overcome the risks and maximise our returns associated with Peer-to-peer financing platforms.  1. Risk Involved: Losing principal invested While Peer-to-p...