peer to peer lending personal loans

Peer to Peer Personal Loans

Peer to peer loans are flexible, offer standout rates, low fees and fast access to funds - on the same day in some cases! Generally, peer to peer lenders use a risk-based tier system, which means the best rate will be given to those people with a good credit rating. Check out the table below to compare peer to peer personal loans.

Peer to peer lending personal loan comparisons on Mozo - last updated 24 July 2021

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    Mozo Experts Choice 2021
    No Fee Unsecured Personal Loan (Fixed)

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    5.95% p.a.to 17.95% p.a.
    5.95% p.a.to 17.95% p.a.based on $30,000
    over 5 years

    NOW Finance has permanently removed all establishment, account keeping and early repayment fees on new unsecured loans up to $50,000. For a simple borrowing solution, get your rate without affecting your credit score today.

    Terms from 2 to 7 years. Representative example: a 5 year $30,000 loan at 5.95% would cost $34,757.21 including fees.

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    Mozo Experts Choice 2021
    Low Rate Personal Loan (Fixed, Unsecured)

    Excellent Credit

    interest rate
    comparison rate
    Monthly repayment
    5.45% p.a.to 8.48% p.a.
    6.07% p.a.to 8.84% p.a.based on $30,000
    over 5 years

    Terms from 1 to 7 years. Representative example: a 5 year $30,000 loan at 5.45% would cost $34,590.57 including fees.

    OurMoneyMarket offer competitive low rates on loans up to $75,000, plus free extra repayments and fee-free redraw facility. Winner of Mozo's Experts Choice Unsecured Personal Loan 2021 award.

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    Personal Loan

    Unsecured, Fixed, Excellent Credit

    interest rate
    comparison rate
    Monthly repayment
    5.44% p.a.to 7.49% p.a.
    5.44% p.a.to 8.19% p.a.based on $30,000
    over 5 years

    Terms from 3 to 5 years. Representative example: a 5 year $30,000 loan at 5.44% would cost $34,332.26 including fees.

    With low rates for borrowers with excellent credit, a quick 1 minute rate estimate and simple online application, there’s a lot to love about this loan! You’ll not only benefit from no exit fees, there are also no early repayment fees. To qualify, simply earn above $25,000 and you’ll be on the way to start spending.

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    Mozo Experts Choice 2021
    Personal Loan

    Unsecured, Fixed

    interest rate
    comparison rate
    Monthly repayment
    5.45% p.a.to 19.99% p.a.
    5.45% p.a.to 19.99% p.a.based on $30,000
    over 5 years

    Terms from 1 to 5 years. Representative example: a 5 year $30,000 loan at 5.45% would cost $34,340.57 including fees.

    Excellent credit score needed to obtain this rate. Enjoy no-fuss personal loans of up to $30,000 with Alex. No hidden early repayment penalties. Terms from 6 months to 5 years. Convenient and fast 100% online approval. Must be over 18 to be eligible. Winner of Mozo's Experts Choice Best New Loan Product award 2021^.

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    Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    6.49% p.a.to 19.95% p.a.
    6.76% p.a.to 20.26% p.a.based on $30,000
    over 5 years

    Terms from 3 to 5 years. Representative example: a 5 year $30,000 loan at 6.49% would cost $35,405.64 including fees.

    Low personalised rates, ideal for borrowers with excellent credit. No monthly account fees, no early payout fees, so you can pay off your loan sooner. Borrow between $5,000 and $63,000. Easy online application, receive a response in minutes and approved funds within 24-48 hours!

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    Unsecured Personal Loan

    Excellent Credit, Fixed

    interest rate
    comparison rate
    Monthly repayment
    5.95% p.a.to 10.49% p.a.
    5.95% p.a.to 12.83% p.a.based on $10,000
    over 3 years

    Terms from 2 to 5 years. Representative example: a 3 year $10,000 loan at 5.95% would cost $10,943.74 including fees.

    Be rewarded for your good credit history with low rates. No ongoing fees. Pay off your loan with no early repayment penalties. Apply online and get a quote in minutes

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    Unsecured Personal Loan

    Fixed

    interest rate
    comparison rate
    Monthly repayment
    5.35% p.a.to 24.79% p.a.
    6.14% p.a.to 25.74% p.a.based on $30,000
    over 5 years

    Terms from 1 to 5 years. Representative example: a 5 year $30,000 loan at 5.35% would cost $34,832.61 including fees.

    Fast, easy and 100% online, this is a low cost loan with no ongoing fees or extra repayment penalties. It's perfect for savvy borrowers with great credit. If you’re over 18 and earn above $30,000, you'll likely qualify.

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    Personal Loan

    interest rate
    comparison rate
    Monthly repayment
    6.25% p.a.to 19.95% p.a.
    7.64% p.a.to 21.35% p.a.based on $30,000
    over 5 years

    Terms from 1 to 5 years. Representative example: a 5 year $30,000 loan at 6.25% would cost $36,103.67 including fees.

    Enjoy flexibility with the ability to make additional repayments. Borrowers with excellent credit rating can receive interest rates as low as 6.25% fixed rate (7.64% comparison rate*). Loan terms between 1 to 5 years.

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^See information about the Mozo Experts Choice Personal loans Awards

*WARNING: The Comparison Rate combines the lender's interest rate, fees and charges into a single rate to show the true cost of a personal loan. The comparison rates displayed are calculated based on a loan of $30,000 for a term of 5 years or a loan of $10,000 for a term of 3 years as indicated, based on monthly principal and interest repayments, on a secured basis for secured loans and an unsecured basis for unsecured loans. This comparison rate applies only to the example or examples given. Different amounts and terms will result in different comparison rates. Costs such as redraw fees or early repayment fees, and cost savings such as fee waivers, are not included in the comparison rate but may influence the cost of the loan.

Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.

While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.

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FAQ

Peer to peer lowdown

If you're looking to borrow from a non-traditional lender, then you may be wondering if a peer to peer provider could be a good alternative. But what exactly is peer to peer lending and is it the right option for you?

Let our quick P2P lowdown answer all those tricky questions to help you decide:

What is P2P lending?

What happens when you remove the banks from the borrowing equation and connect investors directly with borrowers? Well, according to the peer to peer movement you'll get a better personal loan deal with lower rates and fees. Peer to peer platforms aren't just limited to the personal loan world either but include all sorts of services including car-sharing, house swaps, clothes swaps and more...

For instance, house swapping platforms like AirBnB allow homeowners to rent out their property to holiday goers for a short stint. The homeowner gets some much-needed cash and the holiday-goer benefits from paying a cheaper amount for their overseas accommodation.

Traditional peer to peer lending and borrowing works in the same way, as an individual investor uses the P2P platform to lend directly to a borrower. The investor benefits from earning a profit through the interest charged and also gets that good feeling of helping out a stranger, whilst the borrower receives a more competitive rate and lower fees than what is offered by the big banks.

Learn more about peer to peer lenders by reading our tell-all guide here.

Who are the major peer to peer players?

In Australia there are only a few main players (so far) for personal lending:

SocietyOne: As the first peer to peer platform to launch in Australia back in 2011, SocietyOne has a slightly different lending model to the traditional peer to peer platforms overseas because instead of connecting individual investors with strangers, the platform connects wholesale investors with borrowers.

Plenti: Originating in the UK, Plenti was brought to Australian shores in 2014 and was the first peer to peer platform to offer investment opportunities to everyday Aussies and is also known for introducing the concept of a provision fund aimed at protecting lenders if the borrower defaults on the personal loan.

MoneyPlace: The newest player to enter the game of peer to peer lending in Australia is Melbourne start-up MoneyPlace. Like SocietyOne and Plenti, this P2P provider offers competitive rates to creditworthy borrowers. In 2015, MoneyPlace entered into a five year $60 million strategic partnership with Auswide Bank, which will support the P2P lender during its initial growth stage.

You can compare the P2P providers side by side in the comparison table at the top of this page by interest rate, comparison rate (a calculation that shows the cost of both the rate and fees) and the features.

How can a P2P lender give me a better deal?

By removing the banks from the borrowing equation, peer to peer lenders have vastly lower overheads, as they don't have to pay dividends back to shareholders. Plus, they are run entirely online, which means they don't have to pay the high cost of branches and managers either.

What's the difference between a P2P lender and a credit union?

Just like peer to peer lenders, credit unions are also part of the strangers helping strangers social movement, as they are completely customer owned and run by the philosophy of passing profits back to customers not shareholders.

However, there is a distinct difference between the two, as credit unions don't offer the option of becoming an investor like with a P2P player.

As a borrower though, your experience should be the same whether you go for a P2P lender or credit union - you apply for the personal loan and once approved you pay it back in set instalments over an agreed period of time (usually between 1 to 5 years). So if you're trying to choose between going for a P2P lender or credit union, the decision breaker should really be the better deal.

Am I eligible for a peer to peer loan?

As long as you meet the conditions of the P2P provider - e.g over 18 years old and are an Australian resident - you'll be eligible for a peer to peer loan. But keep in mind if you have a poor credit rating you'll have to pay more in interest, as peer to peer lenders use a tier based pricing system reserving their best interest rates for creditworthy borrowers.

For instance at the time of writing, one of the peer to peer players we looked at was offering a low 8.95% interest rate if you had an "excellent" Veda Credit Grade but if your credit rating was "below average" you would receive a high 17.23% interest rate.

Is a peer to peer loan right for me?

If you're a creditworthy borrower looking for a loan under $35,000 for a term of 1 to 5 years then a peer to peer loan could be for you, as peer to peer providers generally have smaller borrowing amounts and shorter timeframes compared to the major bank providers, whose loans can reach up to $100,000 and stretch over a 10 year period.

It's also perfect for borrowers who don't have any security like a car or house to secure a loan with, as peer to peer loans are usually unsecured. Plus if you're on a strict budget, you'll love the fact that P2P loans generally have fixed interest rates that are locked in for the life of the loan.

But if this doesn't sound like you, compare the personal loan market

here, to find the right borrowing match for your needs.

What features should I look for?

Just like any other personal loan, it's important to look for flexible features to make the loan work for you. Here are some things to keep an eye out for:

Extra repayments facility: When you get some extra cash in your pocket, you'll be thankful if the P2P loan you signed up with allows you to make extra repayments, as a little bit extra can go a long way in the long run. For instance, if you take out a $30,000 loan over 5 years with a 9% interest rate and make an extra repayment of $200 each month you will save $2,187 in interest and slash your personal loan by 1 year and 5 months.

Redraw facility: While paying off your personal loan early should be your ultimate goal, if you need some money for unexpected bills or a new family car down the track, the option of dipping into those extra repayments you've made could come in handy.

Flexible repayment frequency: Another feature that can help you pay down your loan sooner is setting up your repayments over a fortnightly cycle rather than monthly. With 26 fortnights in the year, compared to just 12 months this will mean you will pay an extra month every year of the life of the loan. For example, if your fortnightly repayments are $500 you will pay off $13,000 in a year, whereas if your monthly repayments are $1,000 you will only pay off $12,000.

Does a peer to peer provider sound like the right match for your borrowing needs? Scroll to the top of the page to start your comparison. Or alternatively use our personal loan comparison tool to search Mozo's personal loan database that covers over 100 loans in the market today.

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JP Pelosi
Managing editor

Jean-Paul (JP) Pelosi is an experienced journalist and editor who has contributed to many of Australia's leading media outlets including The Guardian, News.com.au, Domain.com.au, Investment Magazine and ANZ's Bluenotes. He has also edited news and communications for large financial services companies such as CommBank, Suncorp, Allianz and Amex. He loves a well told story and applying his editorial experience to content that readers both care about and enjoy. JP heads up our writing team.

More FAQ about peer to peer loans

Do peer to peer loans have fixed or variable interest rates?

The majority of major peer to peer (P2P) players in Australia only offer unsecured fixed interest rates, but there are variable rate options available in the market.

How do interest rates work on P2P loans? 

Generally, peer to peer lenders use a risk-based tier system, which means the interest rate is scalable depending on your credit profile. The best interest rate will be offered to those with a squeaky clean credit rating.

Do peer to peer loans have fees?

Yes, however, peer to peer borrowing fees are generally lower than those attached to personal loans from the big banks, with some P2P providers offering no application, ongoing fees or exit fees.

How do I apply for a peer to peer loan?

Peer to peer providers will have an online application page and you'll need regular information on hand like income details, bank and ID requirements. The benefit of a P2P loan is the fast online approval process, which in some cases means the funds will be in your account on the same day.

How is peer to peer lending different from crowdfunding?

Both peer to peer lending and crowdfunding provide you with funds. The critical difference between the two is that P2P lending gives you a loan that must be repaid with interest, while crowdfunding gives you a sum of money with no expectation of repayment.

Is peer to peer lending safe for borrowers?

As a borrower, a P2P loan is a regular loan. The difference is that it comes from investors rather than a large financial institution. 

That said, you want to be a savvy borrower, so do your homework. You should always check out the investor requirements of the P2P platform you are using before taking out a loan.

You also want to make sure you are informed of your financial position, so you can make the best decisions when it comes to signing off on your loan. Visit our Mozo personal loans hub as a jumping-off point.

Is peer to peer lending good for investors?

Compared to other types of investments peer to peer loans may offer lenders a higher rate of return. Also, a simple P2P platform might make transacting relatively easy and accessible.

Many investors also enjoy the idea of their money going to an individual in need of a loan while also making money themselves. 

Is peer to peer lending a safe investment?

Like all investments, it is important to decide if peer to peer lending is right for you, as it does come with risks. There is no government guarantee of peer to peer lending, like most investments, so it is solely on the lender if the borrower cannot pay. Most P2P loans are also unsecured

To protect yourself as an investor, it is essential to make sure the P2P platform is reputable - operating with an Australian financial services license and registered with the Australian Securities and Investments Commission.

Is peer to peer lending good for people with good credit?

In short: Yes. P2P lending operates on a risk-based tier interest rate system, which means that your rate is customised to you, so If you have good credit, you will be rewarded with a low rate.

Is peer to peer lending good for people with bad credit?

Borrowers with poor credit can benefit from peer to peer lending. As it is a customised market, although you will be paying more than those with good credit, you may have options that would not be presented to you otherwise.


Personal Loan Reviews

ING Unsecured Personal Loan
Overall 1/10
Very very bad new look rate check

Very bad service with new look I don’t like. Different credit score

Read full review

Very bad service with new look I don’t like. Different credit score

Price
1/10
Features
1/10
Customer service
1/10
Convenience
1/10
Trust
1/10
Less
Vidya, New South Wales, reviewed 5 days ago
ING Personal Loan
Overall 1/10
Too bad this new credit score based personal loan.

Too bad this new credit score based personal loan. I am getting different score than with actual score. Too bad I should get 8.99 interest rate but I am getting 10.99. Very very bad.

Read full review

Too bad this new credit score based personal loan. I am getting different score than with actual score. Too bad I should get 8.99 interest rate but I am getting 10.99. Very very bad.

Price
1/10
Features
1/10
Customer service
1/10
Convenience
1/10
Trust
1/10
Less
Vidya, New South Wales, reviewed 5 days ago
Great Southern Bank Secured Car Loan (Fixed)
Overall 5/10
Online application not check.

After applying for a car loan online I was unsuccessful. As directed online, I was told to phone if I wanted clarification. I did. All I was told was that the program worked it out. I asked further questions as we have a home loan with GSB (which has money available for redraw) and had a previous personal home loan which was paid out early. I also checked my credit rating which is excellent. Nothing. I was simply unsuccessful. No going through the details of what I had entered to check if I had filled out the online application correctly. Started another application for a reduced amount and stopped. GSB phoned to see if I needed help with this application. I represented the first loan scenario and a review was taken to see why I wasn’t successful. Low and behold, I had claimed $200 per week for phone use instead of $200 per month. My application would have been successful. Thank goodness for Mazda finance. Approved in less than 24 hours and I got to work with a person faced to face. I’m now taking my home and contents insurance and car insurance elsewhere. GSB have lost my trust.

Read full review

After applying for a car loan online I was unsuccessful. As directed online, I was told to phone if I wanted clarification. I did. All I was told was that the program worked it out. I asked further questions as we have a home loan with GSB (which has money available for redraw) and had a previous personal home loan which was paid out early. I also checked my credit rating which is excellent. Nothing. I was simply unsuccessful. No going through the details of what I had entered to check if I had filled out the online application correctly. Started another application for a reduced amount and stopped. GSB phoned to see if I needed help with this application. I represented the first loan scenario and a review was taken to see why I wasn’t successful. Low and behold, I had claimed $200 per week for phone use instead of $200 per month. My application would have been successful. Thank goodness for Mazda finance. Approved in less than 24 hours and I got to work with a person faced to face. I’m now taking my home and contents insurance and car insurance elsewhere. GSB have lost my trust.

Price
8/10
Features
9/10
Customer service
3/10
Convenience
6/10
Trust
6/10
Less
Gary, Queensland, reviewed 10 days ago

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