Funding Circle investor review: Everything you need to know before investing

Peer to peer lending today is a rapidly developing multi-billion dollar industry. Lending platforms like Funding Circle are now a much more reliable option for investors to earn compared to banks. In this Funding Circle investor review, we’re going to give you all the information you need before investing on the platform.

So, how much can you earn on Funding Circle?

Earnings 5–7% APR
Earnings 5–7% APR

As an investor on Funding Circle, you can expect roughly 5–7% in annual earnings.

Your returns on Funding Circle depend on the risk levels you can handle, the number of borrowers defaults that occur, and your portfolio diversification. We’re going to break this down a little bit for you.

How does Funding Circle work?

Funding circle investor reviews
Funding circle investor reviews

Funding Circle offers medium-term secured and unsecured loans to small, creditworthy businesses. To apply, all businesses must have been in existence for at least three years. Repayment schedules span six months to five years.

As an investor, you’ll evaluate borrowers and — if you find an eligible one — you send them money and they’ll pay you back with interest.

Funding Circle spreads your money across many loans and sets the interest rates for you. They also allow you to sell your stakes in different loans to other lenders if you want out. However, their secondary market is not currently available in the US.

The Funding Circle web portal allows you to view details regarding the business that received a loan from your investment, including the industry, the number of employees, location, and other details.

Funding circle risks: What to watch out for when investing

Like other P2P investments, Funding Circle has its risks. Before you invest your hard-earned money, here’s what you should watch out for.


Even though Funding Circle does a rigorous assessment of the small businesses it provides loans to, some may miss some payments, or fail to pay the loan at all. The loans it provides borrowers are secured (have collateral), but you still risk losing part of your investment if Funding Circle can’t recover collateral.

Due to default risks, Funding Circle requires you to pay an extra percentage of your investments into a provision account. This fund is used to help offset your losses during defaults. It essentially means you are being taxed for the platform’s shortcomings.

Liquidity issues

Funding Circle has no secondary market for US investors. Therefore, you should only invest in the lending firm if you can hold the loan until maturity.

Interest loss

Funding Circle has no early repayment charges, which means that you will not earn the interest you would normally receive if the borrower paid till the end of the term. Funding Circle’s auto-invest tool will instead invest your funds into other notes.

How safe is Funding Circle?

How safe is funding circle
How safe is funding circle

So, is funding circle safe?’

Most Funding Circle investor reviews agree that Funding Circle is safe to invest in, especially now that it has achieved some stability, scale, and profitability. Funding Circle minimizes the risks for P2P investors by taking steps like:

  • Auto-diversification: Funding Circle’s policy does not allow you to put more than 2% of your initial investment in one note. Initial investments on Funding Circle are a minimum of $250,000.
  • Stringent loan eligibility requirements: Funding Circle ensures that only businesses that meet their rigorous creditworthiness assessment get access to the loans. This step, however, does not eliminate all possibilities of bad debt.

Should I invest in Funding Circle?

Funding Circle is not a platform for all investors.

Investing in Funding Circle comes with higher risks than more traditional avenues. That means you must be an accredited investor in the US or have earned an income exceeding $200,000 or $300,000 per year.

Our conclusion for our Funding Circle investor review is that it’s a reputable and high-quality platform for earning steady P2P gains. But unfortunately for many investors, Funding Circle has placed itself at a very exclusive price point and may not be a realistic option.

Fortunately, if you want good returns on P2P investments and don’t have a couple hundred thousand to spend there are other options…

Constant provides secure growth for the average investor from just $50.

Constant is a Pro P2P Lending
Constant is a Pro P2P Lending

Investors and borrowers set their terms

On Constant, we match parties from both sides according to their desired interest rates and term lengths. You can invest anywhere from $50 with no upper limit on earnings at rates up to 7.5%.

Better risk management

Constant uses a cryptocurrency-based loan collateralization process. Borrowers must put up at least 150% of their loan’s value as collateral. It is sold off if the collateral value drops too low or the borrower defaults. In most cases, you keep both your principal and earned interest if borrowers default.

More choice

Everyone likes choice, and we deliver. On Constant, you can choose from a couple of different investment options including 4% APY with any time withdrawals through our Flex lending pool. If that isn’t your speed, you can get 9% APR placing your crypto assets with our liquidity partners.

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Peer-to-peer lending built on peer-to-peer technology. Refer & Earn $10 | Website

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