In the risk reward paradigm, invested money can provide higher profits only if the investor is willing to accept a higher possibility of losses. Therefore, it follows that the expectation of returns should commensurate with the level of perceived risk by an investor. 

For example, the property-backed secured loan generally offers a lower interest rate as these loans are backed by assets which reduce the associated risk.



Conducting Due Diligence

As with any other investment, performing the necessary due diligence is of paramount importance before committing your money to it. This is especially so given that P2P lending is widely considered to be a risky investment product largely due to the inherent credit risk associated. 

Even though FS does not consistently disclose the identity of the borrower, a loan factsheet will invariably be provided before the commencement of the funding process. The document contains the necessary details of the loan, such

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