Have you decided to get into lending? Great idea. This is a traditional and very ancient business, perhaps one of the oldest, and therefore it is very developed and popular. At first glance, it seems easy and pleasant. However, I must disappoint you: most likely, everything will go wrong. You risk losing not only your money but also your time and reputation. It’s better to abandon this idea right away.
Lending may seem like an easy way to make money, but in reality, it is a complex and risky process. It requires deep knowledge, an understanding of the market, and the ability to analyze credit risks. Your first mistake could cost you significant losses, and often newcomers underestimate all the pitfalls.
Moreover, dealing with clients can be challenging. You will encounter various types of borrowers: from those who repay on time to those who delay payments or refuse to pay altogether. You must be prepared to resolve conflicts, understand legal aspects, and protect your interests.
Consider alternative ways of investing or doing business that may be less risky and more predictable. For example, explore opportunities in the stock market, real estate, or startups. These areas also require knowledge and skills, but they can provide more stable and predictable results.
This concludes the introductory part on lending. Thank you for your attention. I hope I have convinced you to give up this risky idea and turn your attention to safer and more promising directions for investing your efforts and funds.