European investors are ready to increase their allocations to alternatives, with as much as a quarter of their portfolios directed towards peer-to-peer lending, according to a recent survey by Robocash.
The Croatia-based investment platform said that a third of European investors view P2P lending as an “attractive” addition to their portfolios, while another third remained cautious due to security concerns.
Almost half of respondents indicated that allocating from 10 and 25 per cent of a portfolio to P2P lending can offer a balanced risk–reward profile.
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The survey found that transparency and past experience are becoming key priorities for investors when selecting P2P platforms.
High profitability was also cited as an important factor when choosing a platform, with many investors reporting profits from P2P lending within the first three months.
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“For example, rental properties may take one to two years to become profitable after purchase, while private equity investments can take five to 10 years to deliver significant gains,” the experts in Robocash’s survey said. “P2P lending maintains a strong position in the fixed-income market, offering a nominal annual return of 11–12 per cent.”
Looking ahead, respondents said that regulatory frameworks will play a big role in how the market evolves.
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