FAQ's


Lender FAQ

Answer

NDX P2P Pvt. Ltd (LiquiLoans) is an RBI registered NBFC – P2P. The Company received its seed funding in April 2018 from Matrix Partners (one of the largest VCs in India), which has invested in marquee companies such as OlaCabs, Treebo Hotels, ItzCash, Quikr, Cloud Nine etc. Matrix Partners & Renowned Angel Investors (Mr. Kunal Shah – CEO of CRED, Mr. Satya Bansal – Ex. CEO Barclays Wealth India, Mr. Abhishek Dalmia – CEO of Renaissance Group, Mr. Ashutosh Taparia – Ex. Owner of Famy Care) etc. have cumulatively invested Rs. 12+ crores in LiquiLoans, given the Company’s defined focus on P2P Segment and its proven execution capabilities.

Answer

As per RBI’s directives, an entity with valid KYC documents (PAN Card, Address Proof, Indian Bank Account, Email Id & Mobile No.) can lend via a Peer-to-Peer Platform. Eligible Entities include:

  1. Individual (18 years old or above)
  2. HUF
  3. Corporate (Incorporated under Indian Companies Act or RBI Listed Finance Companies)
  4. Partnership Firm
  5. Limited Liability Partnership (LLP)
  6. Body of Individuals
  7. Society
  8. Artificial Body

Answer

Each lender can onboard the platform by following a simple 3 step process:

  1. A Lender can sign up & create an account on the platform through the website / intermediary / partner dashboard by filling in the requisite details; adding / uploading their valid KYC documents and by agreeing to the privacy policy & terms and conditions stated on the website (www.liquiloans.com). On successfully creating an account, a welcome email shall be sent on the registered email id to log-into the account and view the lender’s dashboard. Our support team will verify each lender’s details / KYC and approve the lender’s registration generally within 24-48 hours.
  2. Once the registration is verified and approved, the lender will get an e-agreement on their email which has to be signed using OTP sent on the lender’s email; or opt to sign a physical agreement (if requested). The agreement will have complete Terms and Conditions which each lender should thoroughly go through before signing the e-agreement / physical agreement.
  3. Lending Funds / Making an Investment – Each lender needs to transfer funds into the Lender’s Escrow account either by using NEFT/RTGS/IMPS or through Payment Gateway provided on the lender’s dashboard (Wallet - Add Money Option) – Net Banking or UPI

Answer

LiquiLoans needs to verify the data and KYC documents provided by Lenders in accordance with the Master Directions laid down by RBI. LiquiLoans, however, reserves the right to reject any application for registration or terminate the registration of the Lender or refund any funds received from the Lender without reason.

Answer

As per the updated RBI guidelines of Dec 2019, the following limits are applicable to any person(s) lending on P2P platforms:

  1. A Lender can maximum lend INR. 50 lakhs across all P2P lending platforms
  2. A Lender can maximum fund INR. 50,000 per loan
  3. The maturity of the loans shall not exceed 36 months. However, LiquiLoans platform is currently only accepting a maximum of Rs. 10 Lakhs per PAN from any investor. The lender lending more than Rs. 10 Lakhs across P2P platforms shall mandatorily need to produce a certificate to P2P platforms from a practicing Chartered Accountant certifying minimum net-worth of Rs. 50 Lakhs. Liquiloans platform has various offerings for Lenders and depending on the scheme option the minimum amount / holding period can differ. Lenders opting for the auto-invest feature are strongly recommended to invest a minimum of Rs. 1 Lakh to have a granularly diversified borrower portfolio.

Answer

  1. Process to Lend Funds via the Platform:
    A Lender can remit funds to the lender’s escrow account using any of the following methods: Log in to their LiquiLoans account, click on Wallet, then click on “Add Money” icon on the top left corner of the dashboard and enter the amount they wish to transfer. The funds can be transferred in the Lender’s Escrow account through NEFT / RTGS / IMPS. The funds can also be transferred through the Payment Gateway using Net Banking or UPI. If the funds are remitted through NEFT / RTGS / IMPS, the lender mandatorily needs to update the fund transfer reference no. on the dashboard.
  2. Manual Lending Feature:
    Lenders who want to manually view / assess / analyse / underwrite individual borrowers seeking loans (as and when available on the marketplace) – their profile, loan requirement details, credit score, monthly income etc. can opt to do so & then fund either a part or the full loan amount (Upto Max. Rs. 50,000 to one borrower). As and when that borrower gets commitment of total funds seeked by them, the lender needs to enter into a loan agreement with the borrower & once the agreement is duly signed by all lenders subscribing to the same loan, the committed funds need to transferred to the escrow account. To ensure a seamless and swift process for the borrower, any requirement listed by a borrower is initially matched to the auto-invest criteria set by existing lenders, if any. If the entire loan requirement is fulfilled via such matching, the borrower is immediately informed and the loan is pushed to the next stage without listing on the primary marketplace. Such loans will be reflected under the recently funded tab in the primary marketplace. The unsubscribed portion of the loan, whether in part or full, will be listed in the primary marketplace.
  3. Auto-Invest Feature:
    Liquiloans platform offers an auto-invest feature to Lenders on the platform to have a hassle-free experience while lending to the borrowers. The Lender needs to define their criteria and basis the predefined parameters approved / mandated by the lender; funds will be automatically lent to the listed eligible borrowers / loans on the platform satisfying their predefined parameters. Auto-invest feature aims to granularly diversify the funds lent to the borrowers, which can be difficult while selecting borrowers manually. High level of diversification leads to negligible concentration on any one borrower hence reduces the risk of concentration with any particular borrower.

Answer

Liquiloans platform classifies borrowers into A, B and C category depending on their past credit history and other parameters used for due diligence and underwriting of borrowers. However, currently Liquiloans platform only lists borrowers classified as “A” category i.e., prime quality borrowers.

Borrowers are vetted through a proprietary algorithm which checks various parameters, some of which include the following: 

  1. The borrower’s credit profile (CIBIL / Credit Bureau Score & Re-payment track record) 
  2. Social (Location, Age, Current Job Designation) 
  3. Banking History - This information is used to assess the suitability of the borrower
  4. End use of the loan
  5. Past performance of similar loans basis their end use, Referrer of the loan etc.

Answer

Lenders can expect a net pre-tax yield ranging upto 7.50% to 10.50% XIRR Max. on the net invested amount. LiquiLoans, however, does NOT guarantee any returns. In the past, our Lenders have earned an average return up to 10.5% - 12% XIRR depending on the scheme opted by them. Each lender should evaluate their risk appetite and understand all the risks associated with the lending transactions and that P2P platform does not assure return of principal / payment of interest. The platform shall NOT be held liable for any loss of capital or returns. Reserve Bank of India does not accept any responsibility for the correctness of any of the statements or representations made or opinions expressed by the NBFC-P2P, and does not provide any assurance for repayment of the loans lent on it.

Answer

Each lender can opt to list their existing loan(s) for sale, as well as buy secondary loans from the secondary marketplace made available on the platform. Lenders shall have to define the sale / purchase specifications, and if a buyer / seller is available with matching requirements, the transaction will get executed and funds will be settled within 48 working hours. Secondary marketplace is purely a platform provided for transactional assistance (sell / purchase of loan/s) and should NOT be construed as a guarantee by LiquiLoans that such sale / purchases will be executed. In the past, lenders have been able to sell their loan portfolio in the secondary marketplace within 2 days on our platform. The borrower's rights and obligations under a sale / purchase shall not be adversely affected in any way by such sale / purchases. Liquiloans platform offers a secondary market feature to the Lender where they can sell / purchase in whole or in part, the rights, title and interest in any loan transaction to / from any other lender registered on the Website. The flow of funds of any such sale / purchases shall only be through disbursement escrow accounts. All these transactions can be done only with the prior consent of LiquiLoans.

Answer

LiquiLoans does not charge any upfront / transaction fee to the investor/lender. The platform brings complete alignment with the lender’s interests wherein the entire loan servicing fee of LiquiLoans is earned only after the lender makes their indicated yield i.e. If the lenders’ portfolio’s net pre-tax yield is above the indicative pre-tax yield (XIRR) of the scheme selected, then LiquiLoans’ fees will be the difference of Lender’s Actual Portfolio Pre-Tax Yield XIRR and the Indicative Pre-Tax Yield (XIRR) of the Lender; else will be NIL. The Indicative yield and loan servicing fees charged by the platform shall differ depending on the scheme options selected by the Lender on the platform. However, if the Lender wants to pay the fees upfront, they can indicate the same to LiquiLoans in writing.

Answer

  1. As with any type / form of lending, there are some risks, the biggest being that a borrower doesn’t repay i.e., there is a risk that a borrower may default.
  2. LiquiLoans minimizes the above risk by having the best-in-class risk management and borrower sourcing mechanism. LiquiLoans ensures that investment of each lender is diversified across a number of borrowers if the lender has opted for the auto-invest feature and hence protecting the lender from concentration risk of exposing oneself to only few borrowers.
  3. In case of a default, LiquiLoans uses a combination of soft and hard collections to collect missed payments on the lender’s behalf.
  4. LiquiLoans shall assist / facilitate the collection through its in-house collection mechanism and may also send a legal notice on behalf of the lender to the borrower. LiquiLoans has already signed up with collection agencies to recover monies from overdue borrowers, who then on the investor’s behalf will try and reach out to the borrower and get back the outstanding funds on case-to-case basis.
  5. LiquiLoans does NOT guarantee any part / full recovery from borrowers.

Answer

  1. Lock in period / MHP (Minimum Holding Period) on our platform refers to the minimum tenure for which the investor wants to reinvest his EMIs to enjoy the benefit of compounding returns.
  2. LiquiLoans platform offers various scheme options ranging from 0 months to 36 months.
  3. The investors will also have the choice to access the secondary marketplace to liquidate their loans or reinvest the funds once the MHP is over.
  4. In the past, lenders have been able to liquidate their underlying loan portfolios within 2 working days of executing the transaction. However, LiquiLoans does NOT guarantee any secondary sale nor does it promise or give any timeline for successful sale.


Borrower FAQ

Answer

Applying for a loan through LiquiLoans is simple and fast. You can complete the entire process online

  1. Step 1: Register as a borrower
  2. Step 2: Upload the documents required online and submit your loan application for review
  3. Step 3: LiquiLoans will review your loan application and once approved, the amount is disbursed within hours

Answer

The documents are required to identity-check, credit-check and risk-assess a borrower before registration. Apart from the Credit Bureau score, we use various other parameters like ability, stability, past performance and intention of the borrowers, which are evaluated basis these documents. The documents provided like salary slips, bank statements etc. help in taking a collective and transparent decision

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Once your loan is approved, the amount will reach your registered bank account within 2-3 business days

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A borrower can apply for loans upto 10 lakhs INR.

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Loan tenures are fixed from anything between 3 months to 36 months.

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Yes, the borrower has the freedom to choose his/her own date, on which the EMI will charged for every month.

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Interest rates are suggested to every borrower based on a credit appraisal system, that uses the personal and financial details provided by the borrower. Based on which the borrower is assigned an interest rate between 12% to 25% per annum.

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No. Liquiloans only provides unsecured loans, without any collateral of any form.

Answer

No. Liquiloans only provides unsecured loans, without any collateral of any form.