Report Overview

South Africa P2P Lending Market – Industry Trends & Forecast Report, 2029

South Africa P2P lending market size was estimated at USD 1.69 billion in 2022. During the forecast period between 2023 and 2029, South Africa P2P lending market size is expected to grow at a CAGR of 31.03% reaching a value of USD 11.12 billion by 2029. Major factors driving the growth of the South Africa P2P lending market are the emergence and rapid expansion of online P2P lending models across the country. The ability to create a regulatory framework that provides guarantees to market participants and consumers would be critical for a rapidly growing market. Growth expectations in the P2P lending sector are expected to remain steady due to variables, such as interest rate increases, competition with banks, and consumer market size. The lending is expected to accelerate the peak, smoothen corporate operations, and provide simple solutions for individuals and businesses. Several encouraging initiatives have been taken toward building a specialized legislative response to this emerging industry, which provides additional and critical channels of funding for people and startups.

South Africa P2P Lending Market - Overview

Peer-to-peer lending, also known as P2P lending, is a method of lending money to individuals or organizations via online services that connect lenders and borrowers. There is no intermediary (financial institution) between the lender and the borrower. User registration is the first step in the process, which also includes the gathering of online documentation, client identity and verification, loan approval, loan distribution, and loan recovery.

Growth Drivers

Increasing Popularity of Digital Banking Services

Lending operations are rapidly becoming digital due to globalization and the increased usage of Internet banking. This is one of the most key factors influencing how DLP is used in the banking, financial services, and insurance (BFSI) industry to make better decisions, provide better customer experiences, and save money. Also, due to the coronavirus infection (COVID-19) outbreak, financial institutions around South Africa are increasingly embracing digital channels to lend money and manage pandemic challenges. The market's overall expansion is further fueled by the rising use of financial services.

Restraints

Low Awareness and Lower Acceptance

The time-consuming and difficult traditional loan techniques are preferred by many businesses. Due to their fixed customer base and established techniques of credit underwriting, they are unable to adopt innovations. Therefore, it is anticipated that the low adoption of the P2P lending platform will hinder market growth during the forecast period. Also, a lack of understanding about P2P lending as well as a lack of training and skill sets to manage them are the key causes of the poor adoption of automated and advanced P2P lending procedures. These elements will significantly impede market expansion.

Impact of COVID-19 on the South Africa P2P Lending Market

The COVID-19 crisis led to expansion in all areas of fintech, including payments, lending, and conventional banking. Lending platforms have witnessed a significant increase in users despite having fewer users overall. This is partly because many businesses needed rapid loan approvals to continue operating during the tough times. To stop the infection from spreading, people have started to pick contactless transactions. Also, banks have been using digital means to distribute loans under the Paycheck Protection Program more often throughout the COVID-19 pandemic.

South Africa P2P Lending Market

Segmental Coverage

South Africa P2P Lending Market - By Type

On basis of type, South Africa P2P lending market is split into Consumer Lending and Business Lending segments. The consumer lending segment is a higher contributor to the growth of South Africa P2P lending market. It occurs between two people in the P2P loan sector. Rising disposable income and increased urbanization are driving the expansion of the peer-to-peer (P2P) lending market sector during the forecast period. The business lending segment is expected to be the faster-expanding segment during the forecast period. In the peer-to-peer (P2P) lending market, business financing is gaining traction. The expanding number of small and medium-sized businesses, as well as start-ups, is fueling South Africa (P2P) lending market.

South Africa P2P Lending Market - By End User

On basis of end user, South Africa P2P lending market is divided into Consumer Credit Loans, Small Business Loans, Student Loans, and Real Estate Loans segments. The small business loans segment dominates the South Africa P2P lending market. Small business loans are necessary to start a new business, invest in infrastructure, upgrade to the latest plant, expand operations and machinery, maintain inventories, or raise working capital, which ultimately drives the market growth.

Competitive Landscape

Major players in the South Africa P2P lending market include RainFin, FundingHub, Ozow, Fincheck, Lulalend, Naledi3d Factory, Fedgroup, Edge Growth, PeopleFund, and Inclusivity Solutions. The key strategies used by these market leaders are new product launches, mergers & acquisitions, and alliances. To grow their market share, these companies are also focusing on investing in innovations, collaborations, and expansions.

Scope of the Report

By Type

• Consumer Lending

• Business Lending

By End User

• Consumer Credit Loans

• Small Business Loans

• Student Loans

• Real Estate Loans

• Others

1. Research Framework
   1. Research Objective
   2. Product Overview
   3. Market Segmentation
2. Executive Summary
3. South Africa Peer-to-Peer (P2P) Lending Market Insights
   1. Industry Value Chain Analysis
   2. DROC Analysis
      1. Growth Drivers
         1. Increased access to technology and the internet
         2. Large population of individuals who may not have access to traditional banking services
      2. Restraints
         1. Potential borrowers may not have the credit history or financial stability to qualify for loans through P2P lending platforms
      3. Opportunities
         1. P2P lending platforms can provide a valuable service to borrowers
      4. Challenges
         1. Lack of standardization impacts the quality of Peer-to-Peer (P2P) Lending
   3. Technology Advancements/Recent Developments
   4. Regulatory Framework
   5. Porter’s Five Forces Analysis
      1. Bargaining Power of Suppliers
      2. Bargaining Power of Buyers
      3. Threat of New Entrants
      4. Threat of Substitutes
      5. Intensity of Rivalry
4. South Africa Peer-to-Peer (P2P) Lending Market Overview
   1. Market Size & Forecast, 2019–2029
      1. By Value (USD Million)
      2. Market Share and Forecast
      3. By Type
         1. Consumer Lending
         2. Business Lending
      4. By End User
         1. Consumer Credit Loans
         2. Small Business Loans
         3. Student Loans
         4. Real Estate Loans
         5. Others
5. Competitive Landscape
   1. List of Key Players and Their Offerings
   2. South Africa Peer-to-Peer (P2P) Lending Market Share Analysis, 2022
   3. Competitive Benchmarking, By Operating Parameters
   4. Key Strategic Developments (Mergers, Acquisitions, Partnerships, etc.)
6. Impact of Covid-19 on South Africa Peer-to-Peer (P2P) Lending Market
7. Company Profile (Company Overview, Financial Matrix, Competitive Landscape, Key Personnel, Key Competitors, Contact Address, Strategic Outlook, SWOT Analysis)
   1. RainFin
   2. FundingHub
   3. Ozow
   4. Fincheck
   5. Lulalend
   6. Naledi3d Factory
   7. Fedgroup
   8. Edge Growth
   9. PeopleFund
   10. Inclusivity Solutions
   11. Other Prominent Players
8. Key Strategic Recommendations
9. Research Methodology
   1.    Qualitative Research
      1.  Primary & Secondary Research
   2.    Quantitative Research
   3.    Market Breakdown & Data Triangulation
      1.  Secondary Research
      2.  Primary Research
   4.    Breakdown of Primary Research Respondents, By Region
   5.    Assumptions & Limitations

*Financial information in case of non-listed companies can be provided as per availability.

**The segmentation and the companies are subject to modifications based on in-depth secondary research for the final deliverable

List of Figures

Figure 1       South Africa Peer-to-Peer (P2P) Lending Segmentation

Figure 2       South Africa Peer-to-Peer (P2P) Lending Market Value Chain Analysis

Figure 3       Company Market Share Analysis, 2022

Figure 4       South Africa Peer-to-Peer (P2P) Lending Market Size, By Value (USD Million), 2019–2029

Figure 5       South Africa Peer-to-Peer (P2P) Lending Market Share, By Type, By Value, 2019–2029

Figure 6       South Africa Peer-to-Peer (P2P) Lending Market Share, By End-User, By Value, 2019–2029

List of Tables

Table 1 South Africa Peer-to-Peer (P2P) Lending Market Size, By Value (USD Million), 2019–2029

Table 2        South Africa Peer-to-Peer (P2P) Lending Market Size, By Type, By Value, 2019–2029

Table 3        South Africa Peer-to-Peer (P2P) Lending Market Size, By End-User, By Value, 2019–2029

Table 4        RainFin Company Overview

Table 5        RainFin Financial Overview

Table 6        FundingHub Company Overview

Table 7        FundingHub Financial Overview

Table 8        Ozow Company Overview

Table 9        Ozow Financial Overview

Table 10      Fincheck Company Overview

Table 11      Fincheck Financial Overview

Table 12      Lulalend Company Overview

Table 13      Lulalend Financial Overview

Table 14      Naledi3d Factory Company Overview

Table 15      Naledi3d Factory Financial Overview

Table 16      Fedgroup Company Overview

Table 17      Fedgroup Financial Overview

Table 18      Edge Growth Company Overview

Table 19      Edge Growth Financial Overview

Table 20      PeopleFund Company Overview

Table 21      PeopleFund Financial Overview

Table 22      Inclusivity Solutions Company Overview

Table 23      Inclusivity Solutions Financial Overview