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P2P lending

View our range of peer-to-peer accounts

  • Lend to individuals, small businesses or against a property

  • Compare a wide range of P2P accounts

  • Choose your own risk level

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What is peer-to-peer lending?

Peer-to-peer lending enables you to lend to individuals or small businesses - cutting out the need for banks to be involved. You could earn higher returns than from other types of investment, but there are risks.

You can invest in some P2P products through an ISA – using your £20,000 annual ISA allowance. Your £20k ISA allowance can be spread across different types of ISA – such as cash, stocks and shares and an IFISA.

An ISA that contains P2P loans is known as an innovative finance ISA – IFISA. ISA tax rules apply. P2P products are not covered by the Financial Services Compensation Scheme  – including those in an IFISA.


What are the different types of peer-to-peer lending?

The type of peer-to-peer lending (P2P) you choose will in part depend on the type of borrower you are prepared to lend to...

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    Lending to an individual

    While you lend through a P2P platform, the borrowers are individuals who will be assessed first and then granted unsecured loans based on their credit score.

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    Lending to small businesses

    Your loan will be used to help small businesses. There may be additional security should a firm default, such as personal guarantees from the directors.

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    Lending against a property

    You could lend to fund development projects. In this instance your money will be secured against the property, offering some degree of security. 

What are the pros and cons of peer-to-peer lending as an investment?

There are lots of considerations to weigh up when thinking about peer-to-peer lending as an investment. These include…

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    • Potential to make greater returns than other types of investment

    • Loans can be secured, so you have some recourse should a borrower default

    • Some P2P platforms have provision funds should borrowers run into trouble

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    • Peer-to-peer lending is an investment and all your initial capital is at risk

    • There may be charges if you need to get your money back quickly

    • Returns can be lower than expected if the loan is paid back early

Why view peer-to-peer accounts with MoneySuperMarket?

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    It’s quick and easy

    See all options at a glance with key features and an easy-to-follow format

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    View our peer-to-peer lending accounts

    Choose accounts from our range of P2P platforms

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    Start investing today

    Once you’ve decided, click through and set up your account 

How do I choose the best peer-to-peer lending option for me?

Before making a decision on peer-to-peer lending as an investment, these are some of the factors to consider:

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    How much do you want to invest?

    Most P2P platforms will have a minimum and maximum investment amount, so check the terms and conditions are suitable for you 

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    What risk are you prepared to take?

    Peer-to-peer lending can be risky for investors. Make sure you understand the risks and are comfortable before proceeding

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    What is the credit rating of the borrower(s)?

     The higher the credit rating, often the more reliable the borrower. Some platforms have a high threshold for creditworthiness

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    What are the fees and restrictions?

    Check what restrictions and charges you might face for withdrawing your money early, for example, and if there are management costs or platform fees

Victoria Russell

Our expert says


Peer-to-peer lending can offer some eye-catching returns, but it is not without risk and unlike high street savings accounts your money is not protected by the Government if anything goes wrong. This doesn’t mean you should rule out P2P as an investment option though. Make sure you research the platform thoroughly before you lend and be as confident as you can that its provision fund is robust enough to cover any defaults that might arise.

- Victoria Russell , Money & Personal Finance Expert

View peer-to-peer accounts with MoneySuperMarket

You can easily see peer-to-peer lending options with MoneySuperMarket. 

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    It doesn’t take long

    We’ll show you a list of potential P2P investment platforms including more details about how they work.

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    Check the fine details

    See who you’ll be lending to, how often interest is paid, fees and charges, and how your money will be protected. 

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    Get ready to invest

    Once you have made your decision, you can click through to your chosen provider to find out more and start investing today.

If the peer-to-peer lending platform goes best it doesn’t automatically mean you’ll lose your investment. The loan is between you and the borrower, so whether an individual or firm, they will still owe you the debt. As part of the platform’s wind-down the loans are likely to be picked up by a third-party (potentially another P2P platform) who would be in a position to give you recourse. However, this may not always run smoothly, and you may get back less than you had loaned out. P2P accounts - including loans held in an Innovative ISA - are not covered under the Financial Services Compensation Scheme.

While both peer-to-peer lending and crowdfunding involve you giving money to an individual or company, the difference is that peer-to-peer lending is a loan that should be repaid. Crowdfunding does not usually need to be paid back.

It’s often wise to spread your investments because this helps spread the risk. Often peer-to-peer lending is seen as being at the higher end of the risk spectrum. But this could also lead to potentially much higher rewards. For this reason some investors use it as part of their overall investment portfolio.

You may have to pay tax on your returns, but some peer-to-peer investments can now be included tax-free within an ISA. This type of ISA is known as an innovative finance ISA and you can invest up to £20,000 in ISAs, either in stocks and shares, cash, or peer-to-peer loans, or you can invest in a combination of these. ISA tax rules apply.

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