P2P lending can be employed by small and medium-sized enterprises as an alternative way of obtaining working capital in addition to traditional bank loans.
In November 2018, Dr Lerong Lu published an article “Solving the SME Financing Puzzle: Has Online P2P Lending Got the Midas Touch?” in Journal of International Banking Law and Regulation (2018), Vol. 33, Issue 12, pp. 449-460.
Abstract: This article investigates the financing dilemma of small and medium-sized enterprises (SMEs) in the UK. After the global financial crisis, banks have become risk-averse and refuse to lend to small business borrowers. Meanwhile, the recent decade has witnessed the rapid growth of online peer-to-peer (P2P) lending activities, which to some extent substitute bank credit for SME financing. The article analyses the advantages of P2P loans and relevant regulatory issues.
Keywords: SME finance, loan-based crowdfunding, P2P lending, financial regulation, fintech, banking law, company law, corporate finance
Dr Lerong Lu 