Vietnam's P2P lenders suffer high default rates amid rising demand for loans

Vietnam’s nascent P2P lending industry has been paralysed by high default rates with the ratio of non-performing loans (NPLs) estimated anywhere between 8 to 20 per cent of their portfolio, industry observers reckon. The situation is expected to further escalate as the COVID-19 outbreak triggers greater demand for loans from non-traditional avenues, resulting in possibly a higher rate of NPLs.

Vietnam’s P2P landscape is dominated predominantly by about 23 lending startups, including the likes of iCare, Tima, Vaymuon, Growthwealth, Avay, Fiin, Interloan, RoboCash and Finizi, according to data from news aggregator fintechnews.sg.

A majority of these lenders target individual borrowers while a small number, including Nextlend and Lendbiz, focus on the micro and small business segment. Companies that DealStreetAsia spoke to said that demand from borrowers has jumped 20-30 per cent since the COVID-19 pandemic outbreak in the country.

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