European P2P market could grow by 4.4pc next year
The continental European peer-to-peer lending market could grow by 4.4 per cent in 2025, breaking a historical growth record that was set in 2019.
A new analysis from Croatia-based P2P lending platform Robocash found that the average annual rate of return will reach a plateau of 11.6 per cent next year, thanks to recommitments by long-term investors, and rising demand for alternative investments.
“Increasing demand for alternative investments created favourable conditions for the market in 2019,” said the Robocash analysts.
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“The last five years have been challenging for the industry due to several economic and geopolitical events. In 2025, the sector may become more stable and predictable for its major players.”
P2P market yields are expected to grow from an annual average of 11.21 per cent by the end of 2024, to 11.64 per cent in 2025. However, the analysts wanted that market yields will gradually enter a ‘plateau’ stage, demonstrating the limits of nominal and real yields.
“P2P investments will have to compete with high-yielding alternative assets for a place in portfolios, as European investors are more willing to accept risk for higher returns,” the analysts added.
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Robocash found that long-term investors are at the heart of the sector’s growth, with forecasts for the number of new market customers showing a downward trend.
According to the lender, approximately 106,000 new investors will be interested in P2P lending in 2025, representing a drop of 16.5 per cent from 2024.
“In our recent research, we’ve already noted that it is experienced investors who are becoming the main driver of the market,” the analysts added.
“They are quite selective in their choice of P2P platforms and will continue to focus on trusted companies.”
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