Analysts of the P2P platform Robo.cash have identified the most likely trends for the further development of alternative lending in Europe. The most prominent include the increasing importance of the P2P sector in its mainland part, gradual creation of a pan-European space for crowdfunding and stronger cooperation of P2P platforms with banks.
While the growth of the UK P2P market is slowing down due to uncertainties around the upcoming Brexit, continental Europe continues increasing issuance volumes. Apart from the continental leaders – Germany and France – there are other promising countries. The 2017 statistics show a significant annual increase in P2P volumes in Poland (270%), Latvia (240%), Slovenia (208%) and Bulgaria (678%). Most of them are located in East and Southeast Europe, which confirms good prospects of the region and coincides with recent data from Robo.cash’s research.
Although the European P2P market remains quite closed, the previous year showed strengthening of cross-national financial ties. This is facilitated by the gradual formation of a single regulatory zone in Europe. Even if 2020 does not become a turning point for the development of a unified European economic zone, it will definitely accelerate this process.
The openness of P2P companies to technological experiments and their focus on innovations, which allow platforms to work faster and save investors’ time, are another important trend in the industry. Such innovations include automatic decision making and supply generation for investors, as well as the development of scoring models.
Apart from new solutions, there will be changes in approaches to using big data. Along with GDPR, there is a growing influence of PSD2 aimed at increasing the transparency of payments. These directives are regularly updated and have a particular effect on P2P lending. Offering platforms more chances to stay competitive, the new standards also create the need for complex remote identification procedures and special conditions to store and handle user data. In this respect, a number of upcoming EU regulations expanding PSD2 and GDPR can make 2020 challenging for the segment.
Finally, the further development of P2P lending may be supported by its closer collaboration with banks. This interaction may become symbiotic: P2P services can use banks as validators, to increase the market reach, offline presence and access to additional banking services, while banks will benefit from fintech tools, higher flexibility of transactions and access to venture capital.
Robo.cash is a Croatia based fully automated P2P platform with a buyback guarantee on investments operating within the European Union and Switzerland. Launched in February 2017, the platform belongs to the financial holding Robocash Group that unites non-bank consumer lending companies in seven markets in Europe and Asia. As a part of the group, Robo.cash works according to a “peer-to-portfolio” model providing an opportunity to invest in consumer and commercial loans issued by the affiliated companies. For the time of operation, it has attracted over €9 mln of investments, which has allowed to finance €140 mln worth of loans.
