When you start your entrepreneurial journey, the first task is to get the funds to start your business, especially if you are looking for loans. Today, if you need fast credit, digital lending platforms are emerging as the best option.
Digital Lending platforms offer online systems, where borrowers can make a wide range of loans faster, flexible, and accessible to individuals and businesses. It is great for people who have low credit scores and need the funds quickly.
With the evolving digital era, we have many digital lending platforms available in the market; hence, it can be a daunting task to choose one. If you are looking for digital lending platforms, you can find the best one listed here and make your decision.
How to choose the Best Digital Lending platforms for Entrepreneurs?
Before you move on to learn about the best digital lending platforms available in the market, you should know how you can select the one that meets your goals. Before selecting your digital lending platforms, you should keep the following things in mind:
- Know your goals:
- You should determine the goal of your loan and the amount you will need while assessing your financial stability.
- The digital lending platforms offer different types of loans, such as short-term, long-term, and revenue-based finance.
- Check the costs and fees:
- When you go for the digital lending platform, you should also check the interest rate and platform fees to check whether it matches your goals.
- You ensure the platform is transparent about the fees and costs associated with the loans it offers.
- Platform Features:
- You must check the platform features, such as approval time, funding process, and flexible repayment options, and the specific type of loan.
- The best platform offers a user-friendly lending platform, which anyone can navigate through.
- Reputation and Industry experience:
- The next aspect you should focus on is the reputation of the platform in the market through the testimonials, customer service, and reviews.
- You can look for their industry experience and past records on lending and customer reviews.
- Technological advancement:
- Another important aspect for effective search is the technological advancement of the platform, as with the evolving digital era, it’s important you associate with a platform that is moving with the technological changes.
What are the best digital lending platforms for entrepreneurs?
If you are an entrepreneur and looking for the best digital lending platforms, here we have listed the 5 best platforms available in the market:
| Digital Lending Platform | Features | Pricing | Repayment |
| Bluevine | 10+ years of experience 1.3% APYCredit up to $250,000Business loan up to $500,000Data EncryptedTwo-factor authentication Bluevine Business Credit CardAPR lies between 20% to 50% | Standard Plan: No Free Plus Plan: $30/monthPremier: $95/month | Automatic repayment option available |
| OnDeck | Business funding up to $250k Best for short-term loansCredit Limits from $6000 to $200,000 Loan amounts from $5k to $250kNo hard credit pullsFast funding and an easy process625 FICO scores | 0% to 4% of your loan | Flexible repayment terms in 12, 18, or 24 months |
| Upstart | Low fixed rates with no hidden feesPersonal loans $1000 to $75,000Short-term Relief with APR of 36%Minimum annual income required is $12,000 | 0% to 12% of your loan | Offers AutoPay, by check, twice-monthly payments, and otherRepayment term 36 to 84 months |
| CAN Capital | 20+ Industry Experience81,000 businesses servedTransparent with no hidden feesCustomized funding options from $2500 to $250,000+ | Depending on the loan | Automatic on one weekday or each weekday |
| Peerform | Large network of lenders APR for personal loans 4.9% to 450%APR for Payday loans 200% to 1386% | Depend on the type of loan | Online payment via monthly installments, or depending on the loan agreements |
How do digital lending platforms make money?
The digital lending platforms are emerging as a great way to get money, but have you wondered how they make the money to operate and provide you with funds? Here is how the digital lending platform works and makes money:
- Interest Rate: The interest on the loans lent by the platforms is a major way of earning, as typically the interest rates are higher.
- Service fees: The digital lending platform can charge service fees for the financial services it offers, such as approving loans, managing them, and others. But every platform doesn’t need to have the same fee structure.
- Late Payment Fees: If you do not pay on time, the platform will charge extra fees on the repayment, which adds up to the platform’s income.
- Transaction fees: In the peer-to-peer lending model, the platform may charge a cost for transactions from one account to another, as such platforms are generally the mediator connecting borrowers and investors.
What are the future trends for digital lending platforms?
With the digital landscape evolving, the lending platform is evident to have some future trends that you should look forward to, such as:
- Decentralized Lending: With peer-to-peer and DeFi lending getting popular, the future can have more P2P lending, with reduced costs and new investment opportunities.
- Personalized lending: Though some platforms already offer customized lending, it’s a growing trend that is getting popular.
- AI and ML: Artificial intelligence and Machine learning can open new doors for accurate predictions, risk management, and enable efficient operations.
- Data Analytics: The AI and ML integration offer better data analytics, portfolio management, fraud detection, and others that can help in decision-making.
- Green Lending: With the increasing consciousness about the environment, platforms can offer special programs or lending options for green projects.
The market of digital lending is expected to be valued at $71.8 billion by 2032, so there is no doubt it will grow exceptionally, but while you take loans from lending platforms, make sure you evaluate all the risks.
