Social Loans, the solutions enjoying considerable popularity - witness the monthly amount of social lending operations and the fact of continuous activity sites mediating this type of operation. By some they are considered an excellent tool, while others treat them as too risky solution.
How does social lending?
Social Loans (called social lending - loans private, social), but has long enjoyed great popularity in Britain or the United States, in Poland is still relatively new - appeared at the turn of 2008 and 2009. Their assumption is that the loan is concluded without the participation of financial institutions, such as between two individuals. These transactions are carried out at the same time with the participation of the most dedicated social lending websites that do not participate, but only mediate in the process of the loan. The loans are thus finalized between users of the portal, which earns a commission on successful transactions.
It should be noted that each of the users of such portals can incarnate the role of both the borrower and the lender investing in this way their resources. Suitable loan auctions are issued on the website, then by mutual consent of the users comes to their confirmation, and then finalized.
Advantages and disadvantages
The unquestionable advantage of this kind of loans is their availability. In contrast to the standard financial institutions, nobody here will verify the size of our existing loans, or credit enumerated. The advantage is the variable value of the interest of such loans, ie interest rates (except for the so-called guidelines. Anti-usury law) is established between the partners and the transaction is not strictly fixed, so the loan will pay as much for how much the other person agrees to lend us their resources. The third advantage of such solutions is the large scale spread offered in social lending quotas. With as much success can borrow small amounts of 100 zlotys, as well as reaching tens of thousands of dollars.
It is also one of the drawbacks of social loans. Their values are not usually high, so if you want to borrow a large amount, then it may fail, or be associated with the necessity of borrowing under a variety of lenders. The large number may then become simply burdensome.
Another disadvantage is after all a relatively low level of social security loans and the possibility of fraud. The biggest risk is obviously burdened borrowers who borrow a certain amount of money actually does not have a guarantee that it will be returned. Of course, borrowing portals verify the data of its users, and the basis of the loan agreement is civil - legal, but it is nevertheless a small security reliability of the borrower.
Another issue discussed at the forum is the issue of taxation of such loans. The lender is achieved thanks to its profit, so it should be taxed 19% capital gains tax. If borrowers are behind in some situations a real possibility load their tax on civil law transactions.
Social Loans, as each solution, are not without advantages, but also disadvantages. They have their supporters and skeptics who never benefit from the tools of this kind.