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Peer-to-peer lending in Canada

Your guide to peer-to-peer loans in Canada and how they work — for lenders and borrowers.

Peer-to-peer loans offer an alternative approach to borrowing and investing. P2P lenders operate online marketplaces that connect borrowers searching for loans with investors looking to earn a competitive rate of interest.

In this guide, we’ll show you how peer-to-peer loans in Canada work if you’re a borrower or an investor, plus take a look at the loan process on popular peer-to-peer lending platforms.

Peer-to-peer loans: How they work for borrowers

Peer-to-peer loans let you borrow money directly from average Canadian investors, without the need for a bank. It’s quick and easy to apply for a loan online, and P2P lenders often have less strict eligibility requirements than traditional lenders like banks and credit unions.

What is peer-to-peer lending?

Peer-to-peer lending in Canada involves borrowing money from anonymous lenders through an online platform. The platform connects you to average Canadian investors – just like you or me – who want to earn money on interest by loaning out their savings. From there, lenders can review your application and decide how much financing they might want to offer you. Sometimes, they’ll give you a portion of what you need and other times, they may give you the full amount.

Once you receive your financing, you repay your loan with interest through the P2P platform (along with an origination fee in some cases).

Peer-to-peer lenders in Canada

Let’s take a closer look at three popular peer-to-peer lending platforms in Canada and what they have to offer.

goPeer logo


  • Types of loans: Unsecured personal loans
  • How it works: You can apply online for a goPeer personal loan within minutes. Loans are available in all provinces, and there are no restrictions on how you use the funds. Once you’ve applied for a loan, loan offers are sent to your goPeer dashboard. Choose the offer that suits your needs and the money will then be deposited into your bank account.
  • Interest rates: 8.99% - 34.99%
  • Loan amounts: $1,000 – $35,000
  • Loan terms: 36 - 60 months
  • Turnaround time: Approval within 24 hours, funding usually takes a few days
  • Eligibility: You must:
    • Have a credit score of 600 or higher
    • Have a regular source of income of $15,000 per year or more (min. $40,000 is recommended)
    • Have a Canadian bank account
    • Have been a Canadian resident for at least three years
    • Have at least five years of credit history

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Lending Loop

  • Types of loans: Small business loans
  • How it works: You can fill out an online application with Lending Loop within 10 minutes. Your application is then screened by the Lending Loop team and you’ll be assigned a loan grade and sent a personalized loan offer. If you accept the offer, your loan will be listed on the Lending Loop marketplace to be funded by investors.
  • Interest rates: 6.00% - 24.93%
  • Loan amounts: $1,000 - $500,000
  • Loan terms: 3 - 60 months
  • Turnaround time: Applications assessed within 2 business days, loans can then be listed on the marketplace for up to 30 days to await funding
  • Eligibility: You must:
    • Be a citizen or resident of Canada
    • Be at least 18 years of age
    • Have a personal credit score of at least 600
    • Own a corporation, partnership or sole proprietorship that’s at least one year old and generates at least $100,000 in annual revenue

reddit logo


  • Types of loans: Short-term personal loans
  • How it works: /r/Borrow is a subreddit where Reddit members can offer short-term loans to other members. If you meet the eligibility criteria, you can post a loan request to the subreddit. You’ll need to list your location, the amount you want to borrow, when you’ll repay it by and the payment method. Other members can then perform their own vetting process — for example, they may ask you to private message them details such as your driver’s licence, address and social media handles, then review your account history — before deciding whether to offer you a loan.
  • Interest rates: Vary
  • Loan amounts: Up to $1,000
  • Loan terms: Vary
  • Turnaround time: Varies
  • Eligibility: Must have be a member of the subreddit for more than 90 days and have a minimum combined comment and post karma amount of 1,000

How to take out a peer-to-peer loan in Canada

Want to borrow through a P2P lending platform? You’ll typically need to follow these simple steps:

  1. Apply for a loan. Complete an online application with a reputable P2P platform and submit information about your credit score, income and financial situation.
  2. Wait for approval. The platform will assess your creditworthiness based on information such as your credit score and debt-to-income ratio.
  3. Get assigned an interest rate. You’ll be assigned an appropriate interest rate (based on your credit) and then your loan request will go live.
  4. Start receiving loan offers. You’ll receive loan offers from potential lenders. After looking at the offers, you’ll need to decide which one is the best fit for you.
  5. Choose an offer and get paid. Once you’ve accepted an offer, you’ll get your money deposited into your bank account.
  6. Repay your loan. Start making regular repayments based on the terms of your loan contract.

Loan eligibility requirements

To qualify for a peer-to-peer loan, you may need to meet the following eligibility requirements:

  • Be at least 18 years old or the age of majority in your province or territory.
  • Be a Canadian citizen or a permanent resident with a valid Canadian address and two valid pieces of identification.
  • Show proof that you can pay off your loan by showing pay stubs, bank account statements and other relevant financial documents.
  • Have a credit score of at least 600 (and submit to a credit check).

Types of peer-to-peer loans

You can access a wide range of loans through P2P lenders. Available options include:

  • Personal loans. There are secured and unsecured loans available, with minimum loan amounts starting at around $1,000.
  • Debt consolidation loans. With a debt consolidation loan, you borrow a lump sum to pay off all your existing debts. This allows you to save on interest and also simplifies your repayment schedule. Find out the best debt consolidation loans in Canada.
  • Car loans. Some P2P lenders allow you to take out a car loan to finance the purchase of a vehicle. If you’re struggling to qualify for a loan from a traditional finance provider, you may be able to find more lenient eligibility criteria from a peer-to-peer lender.
  • Business loans. P2P business loans can help you start or grow your business with low-interest financing (which can be hard to find from traditional lenders, especially for startups).

Choosing a peer-to-peer lender

Consider the following factors when choosing a P2P lending platform:

  • Fees. Check what fees you’ll need to pay to take out a loan, such as an origination fee. It’s also worth reading the fine print to find out what charges apply if you miss a payment. Learn more about personal loan costs.
  • Interest rates. Find out what personal loan rates the platform offers and what factors it takes into account when determining the rate for your loan.
  • Loan amounts. How much can you borrow through the platform? Is it enough to meet your needs?
  • Loan terms. Does the platform offer short-term loans only, or will you have a longer period to pay back what you borrow? Some platforms offer terms of up to five years.
  • Eligibility requirements. Before you apply, make sure to check the minimum eligibility requirements you’ll need to meet (e.g., credit score, monthly income) to qualify for a loan.

Pros and cons of peer-to-peer loans for borrowers

Thinking of borrowing through a peer-to-peer lender? Make sure you consider the pros and cons first.


  • Easy to apply. You can usually apply for a peer-to-peer loan in minutes online and get approved for financing on the same day.
  • Competitive rates. You can often access competitive interest rates through a peer-to-peer lending marketplace. In fact, it’s possible to get lower rates than you would get from a traditional lender.
  • Lenient eligibility criteria. If you’d struggle to qualify for a loan from a bank, P2P lenders sometimes have slightly more relaxed loan eligibility requirements. In some cases, they won’t just consider your credit score but also a range of other factors when assessing your application.
  • No prepayment penalty. In most cases, you won’t be charged a fee if you decide to repay your loan early.
  • Don’t need to deal with a bank. When you take out a peer-to-peer loan, you can help grow the savings of a Canadian investor instead of the big banks.


  • Fees. Be aware that you may have to pay a loan origination fee or set-up fee when you sign up with a P2P platform as a finder’s fee for matching you with a lender.
  • Hard to qualify with bad credit. If you have bad credit, you may need to look elsewhere for a loan. Learn more about the best bad credit loans.
  • There are faster ways to get cash. It may take multiple days for you to be matched with a lender and receive your funds, which is less than ideal if you need an emergency loan.
  • Fewer regulations. Peer-to-peer lending in Canada is a relatively new industry, which means it’s not subject to the same regulatory oversight as traditional lending institutions.

What are some alternatives to a peer-to-peer loan?

There are a few other types of loans you may be interested in pursuing if P2P lending doesn’t seem like the best fit for you:

  • Personal loans. Personal loans are traditional installment loans that you can borrow from banks or online lenders. Compare the best personal loans in Canada.
  • Bad credit loans. Bad credit loans are offered to people who have bad credit, but they typically come with very high interest rates. Compare the best bad credit personal loans.
  • Credit cards. If all else fails, you may be able to put your expenses on a low-interest credit card in the short term.
  • Borrowing from family or friends. If you’re struggling to get financing from a traditional lender, it could help to turn to your friends and family for financial assistance.

Peer-to-peer lending: How it works for investors

If you’re an investor, peer-to-peer lending offers an alternative way to earn interest on your savings. You’ll typically be able to earn higher rates than you would on a savings account from your bank, and it can also help you diversify your investment portfolio.

However, you’ll need to also accept the risk of borrowers defaulting on their loans, and find out what protective measures the P2P platform has in place for investors.

How to become a peer-to-peer lender

If you’d like to earn investment returns by offering peer-to-peer loans to other Canadians, here’s what you need to do.

  1. Choose a platform. Compare peer-to-peer lending platforms to find one that’s right for you. Be sure to consider factors such as potential returns, fees and how the platform screens borrowers, as well as what happens if a borrower defaults on their loan.
  2. Create an account. The next step is to sign up as an investor on your chosen platform. You’ll need to provide your personal information, contact details and proof of ID, while you may also be asked about your investment objectives.
  3. Deposit money into your account. Now it’s time to deposit the money you’d like to invest into your P2P platform account.
  4. Browse the marketplace. Browse the P2P platform’s marketplace to find a loan you’d like to invest in. Loans are often graded based on the borrower’s level of risk, and you’ll be able to review information such as their income, employment and credit score. You can also check the loan amount, term and interest rate.
  5. Choose the loan(s) you want to invest in. Select the loan you’d like to fund and the amount you’d like to invest. It’s often possible to fund only a small portion of the loan, as little as $10 in some cases, while some P2P platforms offer auto-investment services that select suitable loans for you based on your risk tolerance.
  6. Earn income. As the borrower makes repayments towards the principal and interest on their loan, you receive the money directly into your account. The P2P platform will typically charge a fee that is automatically deducted from your income.

Pros and cons of peer-to-peer lending for investors


  • Get a higher interest rate. You can earn a higher interest rate by investing in a P2P loan than if you put your money in a traditional savings account with your bank.
  • Low minimum investment. While investment minimums vary depending on the platform you choose, it’s possible to start investing in P2P loans with a relatively small amount of money.
  • Diversify your portfolio. Peer-to-peer lending allows you to access a unique type of investment. And because it’s possible to fund a portion rather than the full amount of a loan, you can spread your risk around across multiple loans.
  • Auto invest. Some platforms offer plans that automatically select loans for you to invest in based on your investment objectives and appetite for risk.
  • Easy. It’s quick and easy to create an account and start investing in P2P loans online.


  • Fees apply. You’ll typically need to pay a fee to the P2P lending platform, which will affect the total returns you earn on your investments.
  • Borrowers may default. There’s always the risk that a borrower may default on the loan and you will lose money. Make sure you’re aware of what steps the P2P platform will take to recoup your losses should this occur.
  • Limited protection. P2P lenders aren’t as regulated as traditional lenders, so investors can’t enjoy the peace of mind of protection from Canada Deposit Insurance Corporation or the Canadian Investor Protection Fund.
  • Interest rate risk. If interest rates rise after you invest in a loan, you could be locked into an under-performing investment. But if interest rates fall, the borrower might repay their loan early, resulting in lower returns.

Is peer-to-peer lending safe?

The key to safe peer-to-peer lending is making sure you deal with a reputable platform. Peer-to-peer loan platforms in Canada like goPeer and Lending Loop are regulated by the Canadian Securities Administrators (CSA), so use the CSA’s Are They Registered? tool to check whether a peer-to-peer lending platform is legitimate.

Of course, like any type of investment, peer-to-peer lending comes with a range of risks. The peer-to-peer lending sector is also less strictly regulated than the traditional banking sector, so you may not enjoy the same protections as you would when putting your money in a savings account.

One of the biggest risks to be aware of is that a borrower could default on their loan and you could lose your money. That’s why it’s important to understand how your P2P platform assesses a borrower’s risk, and what steps the platform will take to help recover your money in the case of a default.

There are a few other steps you can take to ensure that your money is safe, such as:

  • Making sure the platform keeps all client money in a segregated account.
  • Reading independent platform reviews from other peer-to-peer investors.
  • Checking any statistics the lending platform provides about loan defaults.
  • Staying up to date with economic developments (e.g., inflation, interest rate rises) that may affect a borrower’s ability to repay a loan.
  • If investing through a platform like Reddit, doing your due diligence to research a borrower’s financial situation before lending them money.

Peer-to-peer investing platforms in Canada

goPeer logo


  • Types of loans: Unsecured personal loans
  • How to invest: If you’d like to invest, you can sign up for a free goPeer account by providing your name, contact details and information about your investment goals. You can then browse the marketplace to find loans that match your investment goals, review the borrower’s details and decide how much you want to invest. The borrower then makes fixed monthly repayments on the principal and interest that are deposited into your account.
  • Fees: 1.5% annual servicing fee (0.125% monthly)
  • Minimum investment: $10 per loan
  • Eligibility criteria: Must be a Canadian resident
  • Auto invest feature: Yes

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Lending Loop

  • Types of loans: Small business loans
  • How to invest: You’ll need to provide your name, contact details, SIN number and verify your bank account to sign up with Lending Loop. You’ll also need to answer questions about your investment goals and risk tolerance. You can then access the peer-to-peer lending marketplace to find a loan that suits your investment needs. Investors purchase securities (called “notes”) that represent fractions of loans, and borrowers make fixed monthly payments towards the principal and interest.
  • Fees: 1.5% annual servicing fee
  • Minimum investment: $25 per loan
  • Eligibility criteria: Must be over the age of 18 and a Canadian resident. Not available to residents of Quebec. Minimum income and asset requirements apply if you want to invest more than $10,000 in any 12-month period.
  • Auto invest feature: Yes

reddit logo


  • Types of loans: Short-term personal loans
  • How to invest: Once you meet the eligibility requirements, you can browse requests for loans on the /r/Borrow subreddit. When you find a loan you’d like to fund, it’s up to you to perform your own vetting process, such as contacting the borrower via private message to request their personal details and account history. Once you and the borrower reach agreement on the loan, you send them the money (often via PayPal). The borrower then repays the principal plus any fee on or before the agreed date.
  • Fees: N/A
  • Minimum investment: N/A
  • Eligibility criteria: Must be a member of the subreddit for more than 90 days and have a minimum combined comment and post karma amount of 1,000
  • Auto invest feature: No

How to choose a peer-to-peer lending platform as an investor

Consider the following factors when choosing a P2P loans platform:

  • Rates. Check out what sort of yield you can earn by loaning money through the platform. It’s also important to find out how interest rates are set, and what level of risk you’ll need to accept to get the rate you want.
  • Fees. The lending platform will usually charge a fee on every loan you fund. Check the fee amount and work out how it will impact your returns.
  • How borrowers are graded. What is the platform’s process for assessing the creditworthiness of borrowers? What factors does it consider when assigning borrowers a risk rating?
  • Repayments. Next, check what loan terms are available through the platform — how long will it take to receive a return on your investment?
  • What happens in the case of a default. Check what steps the platform will follow to try to recover your funds if a borrower can’t keep up with repayments.
  • Legitimacy. Is the platform registered with the Canadian Securities Administrators? What do other investors have to say about it on independent review sites? What sort of track record does the platform have in terms of loan defaults and late repayments?

Bottom line

Peer-to-peer lending can help borrowers access competitive loan interest rates, and help investors diversify their portfolios. However, make sure you’re aware of all the risks involved before deciding whether peer-to-peer lending is right for you.

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