Definitions & Terms

A Buyback Guarantee obliges loan originators to buy back overdue loans from investors. The buyback guarantee is a protection mechanism for retail investors and is also often referred to as a buyback obligation. All buyback guarantees aim to protect investors from non-performing loans and to recover the investments from borrower default. This article will teach you everything you need to know about Buyback Guarantees.

Peer-to-peer lending (P2P) is an innovative form of borrowing and investing money without the involvement of traditional financial institutions. P2P lending is also known as "social lending", "lending-based crowdfunding", or "crowd lending". Learn how it works.

Secondary markets are financial marketplaces where investors trade previously issued assets like stocks and bonds. These markets enable securities exchange between investors, driving prices toward their actual value and providing liquidity.

In balance sheet lending (also called portfolio lending), the platform entity provides a loan directly to a consumer or business borrower. The loan is on the platforms balance sheet. The loan process is direct, like working with a bank.

Online P2P lending began in 2005 with the launch of Zopa in the UK. Back then “shady”, or "niche" at best, was eagerly used words to describe the sector. Fifteen years on, people lend and borrow billions. Here is the history of P2P Lending.

First-rank mortgage (also first-rank, first-lien or senior debt) refers to the most secure available form of loan security. Senior debt takes priority over other more “junior” debt (such as mezzanine debt or equity). Learn about First-rank Mortgages and what it means for lenders and borrowers.

In the Crowdfunding context, a ring-fence is the act of segregating investor funds from assets of the platform. It serves the purpose of creating a barrier against any claims to a platform itself for the protection of investor funds.

The history of crowdfunding goes back to 1200 when crowds financed shipping ventures, but the game changed with the internet. Crowdfunding as we know is a recent innovation but the history tells the story: Crowdfunding is here to stay.

Not a long time ago, crowdfunding was a niche associated mostly with local charities or struggling rock bands. Today it is possible to crowdfund a court case through litigation crowdfunding. But how exactly does litigation crowdfunding work?

Provision funds helps to reduce the risk of investing in P2P lending by creating a safety buffer that P2P platforms can use to anticipate unforeseen circumstances. The goal is to offer a higher level of protection against losses. Does it work?

Reward crowdfunding is a very popular way for startups and entrepreneurs to receive the necessary capital in order to initialize the first steps of getting a business up and running. This is mostly done by pre-selling a product to fund the campaign.

For social enterprises, it can be challenging to find sufficient unrestricted funds via bank finance to scale up their activities or develop a new line of business. Social Impact Lending can be a solution to earn a return while impacting societies.