#AD
Are you looking for new ways to invest and grow your wealth, apart from the traditional investment methods? In recent times, peer-to-peer investing has become a popular investment avenue with the potential for great returns.
While P2P investment involves investing in instruments that lend money directly to people or businesses through online platforms like 13Karat, traditional investments include stocks, bonds, and mutual funds. But if you are confused between P2P investing and traditional investments, then here is a brief read for you.
Let’s compare 13Karat’s P2P high interest rate investment returns to traditional investments so that it becomes easy for you to decide where to invest money to get good returns.
What is P2P Investing?
P2P investing, or peer-to-peer investing, allows people to invest in P2P loans, where their money is given directly to individual borrowers or businesses using online platforms. Investors can sign up on these P2P investment platforms and offer loans to borrowers to earn huge returns.
What are Traditional Investments?
Traditional investments are the well-known avenues which have been in existence for quite some time now. They include stocks, bonds, and mutual funds. While stocks let you buy shares in a company and offer great growth and dividends, bonds are loans to governments or companies that pay you interest over time. Mutual funds, on the other hand, pool money from many investors to help you buy a mix of stocks, bonds, or other assets.
P2P Investments Vs Traditional Investments
Now, let’s compare P2P investments and traditional investments and understand the differences on various aspects:
| Aspect | P2P Investments | Traditional Investments |
| Returns | High return investment |
|
| Risk | Moderate risk |
|
| Liquidity | Low | High |
| Cost | Nil/Low investment cost | May include additional fees and charges |
| Ease of Investment | Easy to Invest | May require extra knowledge and effort |
Learn more about them in detail here:
- Returns
P2P lending returns can be higher in comparison to traditional investments. Stocks can give high returns but can also be very unpredictable. Bonds give more stable but lower returns. With P2P investment apps like 13Karat, you can avail the best investment plan with high returns of up to 13% per annum.
- Risk
There is no doubt that P2P investing carries the risk of borrower defaults. Moreover, as the rules and regulations are still developing for P2P lending, investing here is not considered safer than fixed deposits or savings accounts. However, 13Karat has certainly reduced this risk by checking borrowers’ creditworthiness. On the other hand, traditional investments like stocks and mutual funds come with higher risks due to market fluctuations.
- Liquidity
Liquidity is all about encashing your investments, which means how easily you can turn your investment into cash. Traditional investments like stocks and bonds are usually more liquid than P2P loans. It is because whenever you are in need of urgent cash, you can quickly sell stocks on the market or trade your bonds. However, it is not the same with peer-to-peer lending. P2P loans usually have fixed terms and hence, it is not easy to withdraw early without any charges.
- Fees and Costs
P2P investment platforms usually have lower fees in comparison to traditional investment managers. This is mainly because P2P investing eliminates the need for middlemen. And as there are no middlemen, the platform’s costs are lower. On the other hand, traditional investments, like mutual funds, often have management fees and other charges that certainly reduce your returns.
- Ease of Investment
Using a P2P investment app like 13Karat is easy. All you need to do is download the app, sign up, create an account and add funds to start your investment journey. Moreover, as the platform is user-friendly, it is quite simple to choose and manage investments. But for traditional investments, you need more knowledge and effort, especially if you buy stocks or bonds directly.
13Karat’s P2P Investment Platform
13Karat is a P2P-enabled investment platform that helps investors invest in peer-to-peer lending instruments without any involvement of banks. It makes peer-to-peer investing simple with its user-friendly application. Just sign up on the platform, create an account and you are free to choose different investment options.
The app offers 6-month and 3-month investment plans, offering returns of up to 13% per annum. Moreover, 13Karat’s P2P investments are non-market-linked investments, so the risk involved is minimal.
Benefits of 13Karat’s P2P Investing
There are numerous benefits which you can avail when you sign up for 13Karat’s peer-to-peer investing. The significant ones are:
- Enjoy great returns of up to 13% per annum.
- Smoothly manage your loans and investments on the 13Karat app’s easy user interface.
- Start your investment journey with as low as ₹500.
- No joining fee, processing fee or any hidden charges.
- Non-market-linked investments from 13Karat can help you earn twice as much as FD savings.
With all these benefits, 13Karat’s P2P investing makes for one of the best investment options in India.
Final Word
So, there are several differences between peer-to-peer investing and traditional investments. Regardless, both have unique benefits and risks. Make sure to consider all these merits and demerits before you invest your money and expect returns.
