Australians are using P2P loans to consolidate debt

New data from P2P lender RateSetter shows an average loan of $20,666.

Peer-to-peer (P2P) lending, while having first been introduced in 2012, is still a new concept to many Australians. However, the idea seems to be catching on. The P2P lending space is becoming more competitive, with new lenders being announced all the time, and more Australians are starting to take advantage of the competitive rates on offer. According to new data, these rates are being utilised by borrowers looking to reduce the interest they’re paying on current debts.

P2P lender RateSetter has released an update of its loan book data, which contains details of every loan originated since 2014. Previous updates, which were released by the lender in the name of transparency, have offered fascinating insights into who is applying for P2P loans, what rate they’re receiving and why they applied for the loan.

RateSetter’s latest update is showing that the majority of borrowers are applying for loans to consolidate their debt. This is supported by data from finder.com.au, which places three P2P lenders – RateSetter, SocietyOne and MoneyPlace – in the top 20 lenders people opt for when looking to consolidate their debt over the past 12 months*.

RateSetter P2P Loans

RateSetter customers that are using their loans to consolidate debt

$20,666

Average loan amount for debt consolidation

8.23%

Average annual rate for debt consolidation loans

725

The number of people earning between $50,000 and $100,000 that held debt consolidation loans

64.5%

Percentage of males applying for debt consolidation loans

Based on data from RateSetter analysed by finder.com.au

Source: Australians are using P2P loans to consolidate debt | finder.com.au