Crowdlending: what it is in simple terms, advantages and platforms

Ready to understand fintech terminology and real opportunities for investors once and for all? Crowdlending, crowdfunding, crowdinvesting – what is this and what benefits does it bring us today.

Crowdlending is a modern way of raising financing in which private investors (usually individuals) provide loans to entrepreneurs, startups or small businesses through specialized online platforms. Unlike traditional banks, there is no bureaucracy here, and the decision to issue a loan is made quickly and transparently.

Many people confuse crowdlending with crowdfunding, although there is a fundamental difference between them. Crowdfunding is the collection of funds on a voluntary basis, often without expecting a return: people donate money for the implementation of an idea, receiving symbolic gratitude or a product in return. Crowdlending, on the other hand, implies repayment — investors lend money at interest and expect income. That is, if crowdfunding is support, then crowdlending is an investment with the expectation of profit.

So, what is the essential difference between crowdlending and crowdfunding? The first is a loan with interest, the second is gratuitous assistance or pre-order. Both instruments share one thing in common: they allow you to bypass banks and attract funds directly from people.

The crowdlending mechanism is simple and understandable even for beginners. The process begins when a borrower (for example, a small business owner) registers on a crowdlending platform and submits an application to obtain a loan. The platform checks their creditworthiness, evaluates the business plan and sets the interest rate.

After approval, the application becomes available to investors — individuals wishing to invest their funds. They can invest any amount (often from 1,000 rubles), distributing risks among different projects. This is especially convenient for individuals who want to receive passive income but are not ready to invest in stocks or real estate.

Main participants in crowdlending:

• Borrowers — entrepreneurs and small businesses in need of financing;

• Investors — private individuals seeking alternative ways to invest money;

• Platform — an intermediary providing transaction security, verification and technical support.

Thus, crowdlending (loan) becomes a bridge between those who are looking for money for development and those who want to earn from someone else's success.

Like any financial instrument, crowdlending has its advantages and disadvantages. Among the key benefits:

- Accessibility for investors: minimal entry thresholds allow you to start investing even with a small amount.

- High profitability: interest rates on crowdlending loans often exceed bank deposits by 2-5 times.

- Support for small business: entrepreneurs receive financing without collateral and complex conditions.

- Diversification: you can distribute investments among dozens of projects, reducing overall risk.

However, the risks should not be forgotten:

- Probability of default: the borrower may not return the money.

- Lack of insurance: unlike bank deposits, crowdlending investments are not protected by the state.

- Insufficient regulation: especially in countries with underdeveloped legislation in this area.

Therefore, it is important to carefully select platforms, study borrower ratings and not invest all funds in one project.

Crowdlending in Russia has been actively developing since 2018, when the Central Bank began regulating this sphere. Today, there are more than 20 licensed platforms operating on the market, such as "Potentsial", "ActivInvest", "SmartInvest" and others. According to expert forecasts, by the end of 2025, the volume of the Russian crowdlending market may exceed 100 billion rubles, making it one of the most promising segments of fintech.

Abroad, crowdlending has long become a familiar tool. In the UK, USA and EU countries, it is used both for financing small businesses and for personal needs. Platforms like LendingClub, Funding Circle and Zopa process billions of dollars annually, offering investors stable income and borrowers flexible conditions.

The Russian market is gradually adapting best global practices, improving investor protection and expanding opportunities for borrowers. Niche projects are especially promising — for example, in the field of green technologies, transport or innovative production.

If you are looking for a non-standard but profitable way to invest funds, pay attention to innovative projects such as "New Generation Airships" (using a crowdinvesting platform) — a unique opportunity to invest in the future of air transport today. Learn more and become part of the technological breakthrough, if you are already ready, right here.