How P2P platforms manage flow of funds between lender and borrower?
Thursday, November 2, 2017, 6:19 PM
P2P platforms use an Escrow Account. An Escrow account or a holding-account becomes necessary to seamlessly manage the fund flow in a P2P environment. The Escrow does the work of holding the lenders’ funds, transferring funds to the borrower and collecting monthly repayments. The Escrow also ensures that the lenders’ funds is always at arms length and cannot be misappropriated by the P2P platform.