Welcome to BTCJam! We are excited that you are joining our great community and that you want to help other people realise their dreams while making solid returns on your investments.
How is Peer to Peer Lending better than other types of money lending?
At BTCJam, we really believe in Peer to Peer Lending, which allows investors to invest directly into borrowers in a very transparent way. This brings three core advantages:
- Low fees. The platform usually takes a low, around 1% transaction fee for checking credit/income/address and making the connection possible. This helps make great rates and great returns possible.
- Great Rates Since lenders decide who gets funded, the market will adjust interest rates in a way that borrowers will most likely receive the lowest possible interest rates they can get (otherwise they would leave for another service) and investors will get a high return/risk ratio (otherwise they would invest their money in other opportunities offering better return/risk ratio).
- Diversification Investing in peer to peer loans offers a very strong diversification from the stock market, as evidenced in this Seeking Alpha article: It summarises: “In this regards, and considering the affordable diversification, low correlation to the Stock Market and above-average returns, even after considering defaults, Peer Lending remain an attractive alternative asset.”
Why invest with BTCJam specifically?
There are many great reasons to be investing with BTCJam. On top of the ones listed above, BTCJam offers
- Even Better Returns. Check the returns of our best investors on our leaderboard!
- Even Lower Risk through extensive geographic diversification. We are the only site that operates globally!
- Help People in economically underdeveloped regions getting a credit for the first time and starting a new business or even new life!
Most developing countries need to attract capital from foreign investors to develop their infrastructure. To be competitive and since there is quite bit of risk involved, they have to offer quite high interest rates to those investors. Since the treasuries they are selling can also be bought by their local national banks, the interest rate banks are giving to consumers are higher as well, since they need to have a similar or higher internal rate of return on consumer lending in order to justify the investment of time and capital.
But with peer to peer lending, as long as we can create a better return/risk ratio for lenders than other alternatives they have access to, we will be able to offer loans to borrowers in those countries at rates, that in many cases are much lower than what they can get at their existing banks.
Since successful lenders are spreading their investments across many different borrowers across many different geographic and economic regions, they face a very low correlation of default between the rates.
Read more in our article How to Diversify we explain more in depth why the risk is lower and how our model allows investors to diversify really nicely.
Helping People: Socially conscious investing with BTCJam
Did you know that borrowing money can be a serious challenge depending on your credit situation or if the need of it is immediate? Around the globe, good people who can afford paying the cost of money, need to borrow it but can’t do so immediately. There are many roadblocks, the main ones being a high level of bureaucracy and incredibly high interest rates.
For example, in Brazil, if you have outstanding credit card debt, you are paying almost 200% APR (yes. two hundred percent).(Source: http://www.imf.org/external/pubs/ft/scr/2013/cr13149.pdf )
In many other countries around the world, people are facing similarly harsh conditions to get credit at reasonable rates.
The concept of peer-to-peer lending is already, by itself, a more democratic way to loan money. But, unfortunately, since we have countries and currencies boundaries, current peer-to-peer lending platforms don’t reach people located in developing countries or the poor people who happen to not have a great credit score yet. People who need it the most. With BTCJam we offer you the possibility to work with Bitcoin, so can take, together, this real first step to credit access around the globe.
We all know how necessary and, why not, fun, it is to make a profit. However, our conscience never allows us to forget about our responsibility to build a new and better world. How does it sound to actually help, solving people’s financials problems and at the same time you are getting paid for it?
It is possible. It’s already happening here at BTCJam.com.
Check out the newest listings we have for you on BTCJam.com