How Can P2P Lending Loans Make SMEs in Indonesia Grow More? – As quoted by Good Finance, the contribution of the Micro, Small and Medium Enterprises (MSME) sector to gross domestic product has increasingly stretched in the last five years.
Play an important role in the development and economic growth.
The Ministry of Cooperatives and Small and Medium Enterprises (SMEs) in Indonesia noted the contribution of the MSME sector increased from 57.84% to 60.34% in 2016. MSMEs in Indonesia are currently considered to play an important role in the development and economic growth.
Among MSMEs, the creative economy industry also contributed positively to the growth of 5.6% since 2010. Its contribution to gross domestic product (GDP) reached 7.1%. For this matter, the government is targeting GDP contribution to reach 7 – 7.5% by 2019.
By looking at the facts, of course, it is the duty of the community to continue to drive the progress of productivity of MSMEs in the future. However, currently, a large number of MSMEs in Indonesia still face a big problem, in the form of limited business capital.
Overcoming this problem, P2P Lending loans are the best solution for the needs of SME funds. P2P Lending loans allow small business owners to get capital faster.
Why do we say that P2P Lending financing is one of the right answers as an alternative to SME capital?
Reasons Why P2P Lending Loans Can Be the Right Answer as an Alternative to SME Capital?
1. Without Guarantee
Limited access to capital loans faced by SMEs in Indonesia is due to mismatches between financial products offered by traditional institutions and the needs of SMEs. Most traditional institutions require borrowers to provide guarantees before loans can be disbursed.
Meanwhile, most SMEs tend to lack assets or collateral to be able to meet the requirements of institutions such as banks.
Loan products from traditional institutions also require a loan process that is quite complicated and usually requires a long time in the process of withdrawing money. This is certainly more difficult for SMEs who need fast loans to meet business capital needs.
P2P Lending loans, on the other hand, are suitable loan options for SMEs because they do not require collateral. P2P Lending loans are based more on whether SMEs are considered feasible or credible enough for the funds requested.
To get funds from P2P Lending loans, SMEs need to submit capital requirements to the P2P Lending platform. If the proposed business is deemed feasible, the P2P Lending loan company will collect the requested funds from a group of individual investors.
Funds obtained from investors are then directly given as a form of capital loans for SMEs that apply for loans.
2. Simplified Borrowing
Usually, capital loans submitted by SMEs will be used for working capital and cash flow from a business. Certainly making a capital loan is needed quickly to support the sustainability and development of a business. Example: You are an electronics shop business owner.
Once a lot of the latest electronic models came out, where the model is very best-seller among users. To sell the latest electronic products, of course, you need to buy it first to the manufacturer before you sell it.
In this case, you will need enough capital as one of your business development needs. The faster you are able to provide the latest products, the sooner you can benefit from the product that is the best seller.
In this case, it can be seen that an SME is also a race against time-related to capital needs needed for business development.
Unfortunately, some types of bank loans usually take 2-3 months to get approval. Without enough capital, SMEs are in a dangerous position. One of the selling points of P2P is a simple and fast application process, usually based online.
If a business is indeed considered feasible, then the disbursement process will not take long. Most P2P activities are provided by fintech companies which will allow you to easily open the P2P Lending company website, register and register for an account, and complete the application for SME loans within 10 minutes.
3. Lower interest
P2P Lending loans tend to provide lower interest rates compared to other similar loans.
For example, currently, Good Lender as one of the existing P2P lending platforms that have been registered with GFI is able to provide loans with an interest rate of only 0.75% – 1.67%. The small interest given will certainly be very helpful especially for SME owners in Indonesia.
4. Ask Anytime and Anywhere
Along with advances in the field of fintech today all things are very easy and possible to do. Nowadays, you can easily apply for a loan anytime, anywhere.
Only by visiting the website of the existing platform, the proposed loan will be disbursed within a specified amount of time.
5. Faster Disbursement Process
Applying for a loan of funds to traditional institutions usually takes about one month before the money is disbursed. Now, through the P2P Lending platform, you can shorten your waiting time faster.
Without the need to wait long, if you are able to complete the requirements needed, the loan will usually be disbursed within a period of several days. This, of course, can happen because the loan you are proposing comes from thousands of investors on the P2P Lending platform.
Benefits of P2P Lending
Is it clear that it’s not about the benefits of P2P Lending? With the various facilities offered, of course, able to make this type of loan to be the right alternative for those of you who need a loan.
The faster and more profitable loan you get, the more business you have. So, don’t hesitate to apply for your loan right now, if you really need the loan!