Getting a peer-to-peer loan from private individuals online: A guide
07.06.2025
9
Minutes
Katrin Straub
Managing Director at nextsure
Are you looking for an alternative to a traditional bank loan? A peer-to-peer loan from private individuals online can be a flexible and often faster solution. This article explains in three steps how the process works and what you need to pay attention to.
The topic in brief and concise terms
P2P loans connect borrowers directly online with private investors and bypass traditional banks.
The credit check is often more flexible than at banks, which also gives groups such as self-employed people or students a chance.
In addition to interest, platform fees of three to six per cent apply, but special repayments are usually possible free of charge.
How P2P lending works: four steps to a personal loan
A peer-to-peer loan connects borrowers directly with private investors via an online platform. This process, which has existed since around 2005, makes traditional banks as intermediaries redundant. The entire process is designed for efficiency and digital handling. The majority of applications can be completed in under 30 minutes.
The process of applying for a P2P loan is standardised and transparent:
Registration and application: You register on a P2P platform and submit a digital loan application, stating the loan amount, term and intended purpose.
Credit assessment: The platform carries out a credit assessment, which often takes hundreds of features into account and not just the pure SCHUFA score.
Funding: Your anonymised loan project is presented to private investors, who decide whether they want to invest. Often dozens of investors jointly finance a single loan.
Disbursement and repayment: Once the target amount has been reached, the loan is disbursed following a final review. Repayment is made in monthly instalments to the platform, which distributes the money to the investors. For a smooth process, an accurate online household budget calculation is crucial.
This direct connection between borrower and lender creates a new dynamic in the financial market.
Terms and Costs: Maximising interest advantages and fees
The interest rates for P2P loans depend heavily on your individual creditworthiness. While investors can expect returns of over ten per cent, the effective annual interest rates for borrowers can vary greatly. Platforms also charge brokerage fees, typically between three and six per cent of the loan amount. This fee is often deducted directly from the loan amount.
A key advantage is the flexibility in repayment. Many providers allow free early repayments, which often incurs additional costs with traditional banks. Moreover, the loan with no restrictions on use of funds is the norm, giving you maximum freedom in how you use the money. The possible loan amount ranges from small sums to €250,000 with some providers. However, the exact terms depend heavily on the respective platform, which is why comparing options is essential.
Regulation and Security: Understanding the Role of BaFin
Although P2P platforms are not banks, they do not operate in a legal vacuum. The operation of such a platform in Germany is subject to supervision by the Federal Financial Supervisory Authority (BaFin). The exact structure of the licensing requirement depends on the platform’s business model. Many P2P providers therefore work with a licensed partner bank to meet all regulatory requirements.
For borrowers, this means a high level of security in data processing and contract handling. However, there is no deposit protection as with banks, which is primarily a risk for investors. Since 30 December 2023, the Secondary Credit Market Act (KrZwMG) has regulated the sector even more strictly and strengthened borrowers’ rights. A loan comparison with TÜV seal can help you identify reputable providers. The regulatory framework creates trust and stability for all parties involved.
Target audience analysis: Who benefits most from P2P loans
P2P loans appeal to a broad target group that often has difficulty obtaining financing from traditional banks. These include three groups in particular: self-employed people, students and employees on fixed-term contracts. For these groups, proving a regular and secure income is often a hurdle. P2P platforms use extended scoring that takes more than just the usual key figures into account.
People with a less-than-ideal SCHUFA score also have a fair chance here. While a negative entry at a bank often leads to immediate rejection, a loan without Schufa may be possible via P2P platforms under certain circumstances. It is important that you can demonstrate that you are able to repay the loan. The digital and fast process also makes this type of loan attractive to young, digitally savvy people who are looking for straightforward financing. This opens up new ways to finance personal or business projects.
Expert tips: How to optimise your loan application
To obtain the best terms for a peer-to-peer loan from private individuals online, you should prepare your application carefully. A transparent and honest presentation of your financing project increases investor trust. This can increase the likelihood of funding by up to 20 per cent.
Our expert tip: Describe the purpose as specifically as possible. Investors are more likely to invest when they can understand what the money is needed for. Another tip is to upload all requested documents completely and promptly to speed up the process. A fully digital process often enables a instant online loan approval. Be aware that a credit enquiry is also recorded with SCHUFA for P2P loans. Good preparation is the key to success.
Request your individual risk analysis now: Have your insurance situation checked free of charge and receive specific optimisation suggestions.
More useful links
Statista provides forecasts for fintech transaction volume in the alternative lending sector in Germany.
The German Bundestag provides a document on the topic of P2P loans.
The Deutsche Bundesbank publishes statistics on interest rates for consumer loans to private households (instalment loans).
The Deutsche Bundesbank also offers statistics on deposit and lending rates.
The Federal Statistical Office (Destatis) provides information on assets and debts.
A press release from the Federal Statistical Office (Destatis) provides information on current developments.
FAQ
What happens if I can no longer pay my instalments?
If you are having payment difficulties, you should contact the P2P platform immediately. In general, a reminder process is initiated, which is transferred to a debt collection agency if the default continues. This leads to negative SCHUFA entries and additional costs.
Can I repay a P2P loan early?
Yes, with most P2P platforms, free special repayments and complete early repayment of the loan are possible at any time. This is a key advantage over many bank loans.
What documents do I need for the application?
As a rule, you will need a valid identity card or passport for identity verification (e.g. via VideoIdent), recent proof of income (payslips, tax assessments) and bank statements from the last few months.
Do private investors find out my name?
No, the process is anonymous for both sides. Investors only see relevant, but anonymised data about your loan project, such as credit rating class, loan amount and purpose. The platform acts as an intermediary.
Can I apply for a P2P loan for my business?
Yes, many platforms also offer P2P loans to self-employed people, freelancers and small businesses. This is often a flexible alternative to traditional business financing from a bank.
What are the fees for a P2P loan?
In addition to the interest, the platforms charge a one-off brokerage fee. This is usually between three and six per cent of the loan amount and is deducted directly when the funds are disbursed.
