Explanation:

P2P can be defined as the use of an online platform that matches lenders with borrowers in order to provide unsecured loans.

It is used to raise loans which are paid back with interest.

The borrower can either be an individual or a legal person requiring a loan.

The interest rate may be set by the platform or mutual agreement between the borrower and the lender.

Fees are paid to the platform by both the lender as well as the borrower. Borrowers pay an origination fee — either a flat rate fee or as a percentage of the loan amount raised — according to their risk category.