Best Lenders for Peer to Peer Loans

peer to peer lending

In the past, if you needed a loan, you didn’t have many options other than your local bank or credit union. In 2021, you can still go to a traditional bank, but you can also shop for loans from a variety of other types of lenders. Peer to peer loans match investors who want to make money or help out their community by being lenders directly with borrowers. This guide will cover some of the best peer to peer lending networks.

5 Best Lenders for Peer to Peer Loans

  • Prosper: Best for people with good to excellent credit
  • LendingClub: Best for people with average credit
  • Kiva: Best for first-time borrowers
  • Peerform: Best interest rates
  • FundingCircle: Best for small businesses

Best Lenders for Peer to Peer Loans: Top Picks

Prosper — First Peer to Peer Lender in the United States

Established in 2005, Prosper was the first peer to peer lending marketplace in the United States. Prosper’s loans range between $2,000 and $40,000 in three- or five-year terms at interest rates of 7.95%–35.99%. There are no prepayment penalties, and once approved, borrowers can have the money directly deposited into their bank account. No collateral is required for these loans, but borrowers without excellent credit may be charged high interest rates or not be approved at all.

LendingClub — Variety of Loan Products

Borrowers can choose peer to peer loans for personal loans, business loans, auto refinancing and patient solutions from LendingClub. Personal loans are available for up to $40,000 and can be used for almost any purpose. Qualified business owners can borrow as much as $500,000 to use for business purposes. Auto refinancing is available for cars that are less than 10 years old, have fewer than 120,000 miles and meet the rest of the qualifying criteria. The LendingClub Patient Solutions plan is for assistance with medical and dental bills. LendingClub is a good option for people with average or better credit who need or want non-traditional financing options.

Kiva — 0% Interest on Business Loans

Kiva is a nonprofit organization founded to help people eliminate poverty through lending. Customers can get peer to peer loans up to $15,000 with no interest to use to grow a business. However, customers must do a bit more of the legwork than with other lenders. Once qualified, borrowers are given the option to invite friends and family to contribute to their loan and make their loan public, similar to a crowdfunding platform. However, unlike crowdfunding, borrowers need to repay the loan over three to five years. Kiva loans don’t require a minimum credit score to qualify, but borrowers do need to convince investors to invest in them. Those who manage to fund their projects benefit from a complete lack of interest charges.

Peerform — Low Interest Rates

Peerform offers peer to peer loans from $4,000 to $25,000 at rates starting at 5.99%. There are no hidden fees and no prepayment penalties. Funds are directly deposited in borrower’s accounts in a few days. The main draw of a Peerform loan is the low interest rates; however, only customers with the best credit will receive the best rates. Customers with lower credit scores may pay up to 29.99%.

Funding Circle — Higher Loan Amounts for Growing Businesses

Funding Circle focuses on the needs of small businesses. By completing one application, borrowers can be matched with peer to peer loans for lines of credit, Small Business Administration Loans, cash advances and more. Funding is available as soon as the next day after approval. Loan amounts range from $5,000 to $500,000 at rates down to 6% for terms of three months to ten years. There are no prepayment penalties, and funds can be used for any business purpose. The variety of loan products and the ability to borrow substantial amounts make this an ideal option for small business owners who need to cover immediate expenses or need capital to grow their business.


Peer to peer loans can be an ideal way to obtain funding for people who need or want to bypass traditional lenders. Whether you need money for your small business, want to consolidate your debts or take a family vacation, there is a lending option for you.

Quick Questions

What are peer to peer loans?

These loans are loans made directly from one individual to another, though they are often facilitated by lending networks. 

How do peer to peer loans work? 

On the borrower’s end, most loans work the same way as traditional loans. However, on the back end, instead of the funds coming from a bank or other financial institution, they come from individual investors.

Are peer to peer loans safe?

Most of the risk in this kind of lending is taken on by the investors. However, using a reputable lending network helps ensure that both borrowers and investors are protected.

If you’re interested in more traditional options have a look at our list of the best personal loans available now.

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