Which type of alternative funding primarily assesses risk through a business plan?Online lendingPeer-to-peer lendingCrowdfundingAll of the above
Question
Which type of alternative funding primarily assesses risk through a business plan?Online lendingPeer-to-peer lendingCrowdfundingAll of the above
Solution
The type of alternative funding that primarily assesses risk through a business plan is Peer-to-peer lending.
Here's why:
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Online lending: While online lenders do consider a business's plan, they also heavily weigh credit scores and financial history when assessing risk.
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Peer-to-peer lending: This type of lending primarily assesses risk through a business plan. Investors in this scenario are often more interested in the viability and potential of the business idea, and less concerned with credit history.
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Crowdfunding: While a business plan is important for attracting crowdfunding, this type of funding is often more about marketing and public appeal than risk assessment.
So, the answer is Peer-to-peer lending.
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