The Kuflink Peer to Peer Investor Blog

Publish at: 2021-11-09 17:32:58

Is peer to peer lending passive income?

Most people earn income by making smart investments and having a system in place which helps them earn money without exerting much time or effort. This is called passive income.
Passive income means earning from sources other than an employer. This income comes from various sources without putting in a significant amount of effort, energy, time and other resources. Portfolio income, income from royalty, and rental income are some traditional examples of passive income. Some latest examples include peer to peer lending, YouTube channels, and eBooks.

What is Peer to Peer Lending?

Peer to Peer lending is a type of lending that directly connects the individuals who want to invest their money by lending to the individuals who need money. It cuts out the need for an intermediary such as a bank or financial institution. It offers benefits to both borrowers and lenders by enabling the lenders to earn higher returns and borrowers to get quick access to funds.

How to Earn Through P2P Lending?

Lenders get their money back, which they lend in the form of equated monthly investments (EMIs) that include their capital investment plus the interest earned. Borrowers repay the lenders every month through EMIs. Peer to peer lending platforms collect the monthly repayments from the borrowers on behalf of lenders and add them to the lender's account. Lenders can choose to withdraw or reinvest this money.

Lenders can earn stable and high returns by building a diversified portfolio. Moreover, with the help of a diversified portfolio, they can mitigate the risk of default by investing their money across borrowers with different risk profiles, occupations and demographic regions. However, selecting the borrowers or loans can be a time-consuming process. That is why peer to peer lending platforms like Kuflink offer innovative products such as auto-invest to make it easy for investors to build a portfolio without spending much time and effort.

How To Make Passive Income Through Peer to Peer Lending?

By definition, passive income is a type of income in which you do not need to put much time and energy. You can also earn passive income through peer to peer lending by making smart investments.

Automated Investment

Peer to peer platforms offers auto investment options that help investors build a portfolio without spending considerable time and energy. This way, you do not need to spend time reading borrowers’ profiles. Instead, you can add funds in auto investment and set specific lending criteria according to your investment strategy.
You can sit back and relax, let the algorithms build your portfolio automatically by matching you with the borrowers according to your investment goals and set criteria. Auto investment is a less time consuming and efficient method of investing in peer to peer lending that can help investors earn passive income.


Investors earn income from p2p loans as monthly instalments through EMIs, which is transferred to their escrow accounts. They can either withdraw this money or reinvest it to get more stable and high returns.

If you choose to reinvest your money, it can provide you with several benefits, such as the benefit of compounding interest. Investors who reinvest can earn more returns than those who do not reinvest. Furthermore, it reduces the time and effort of investors. By activating the reinvestment option, you allow a platform to auto-invest your money in the same products to continue generating profits. This way you do not need to spend more time investing funds again and again.

Systematic Income Generation Plans

One latest, least time consuming, and most efficient method of investing in peer to peer lending is a systematic income generation plan. It is used when a lot of investors pool their investments into a single portfolio so that they can achieve efficiency in building and managing a platform.
This pool uses new technologies such as artificial intelligence and data science to build and manage a portfolio that can provide them with stable and high returns.
You just need to deposit your money to an authorised peer to peer lending platform to disburse it in this type of investment. The platform will disburse your pool money in different types of loans and products from which you can get high aggregate returns.

Make Kuflink Your Passive Income Partner

Let’s discuss the reasons you should choose Kuflink peer to peer lending to earn better returns:

• Kuflink co-invests up to 5% alongside investors* (Select-Invest only)
• Entire loan book is secured against UK property* (1st & 2nd legal charges)
• Independently AUDITED Accounts since 2014 (Kuflink Group Plc)
• Peer to Peer Platform (Kuflink Ltd) profitable since 2020
• Bridging Loans since 2011 & Online P2P Platform since 2017
• Blended LTV & LTGDV 63.93% (Pool) (1st November 2021)
• Over 820,540 investments with over £91 million capital repaid (1st November 2021)
• Loan book monitored daily by our in-house collections team
• Collections use 30-day Default rule v 180-day FCA Default rule

Learn More

All the above is for information purposes only. Please always seek professional advice before acting. 

*Capital is at risk and Kuflink is not protected by the FSCS. Past returns should not be used as a guide to future performance. Securing investments against UK property does not guarantee that your investments will be repaid and returns may be delayed. Tax rules apply to IF ISAs and SIPPs and may be subject to change. Kuflink does not offer any financial or tax advice in relation to the investment opportunities that it promotes. Please read our risk statement for full details.

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