Alternative Financing Market Size Worth $45.72 Billion By 2030

Alternative Financing Market Growth & Trends

The global alternative financing market size is expected to reach USD 45.72 billion by 2030, growing at a CAGR of 20.2% from 2023 to 2030, according to a new report by Grand View Research, Inc. Alternative finance products are often more flexible and convenient than traditional banking products. For example, online lending platforms allow borrowers to apply for loans from the comfort of their own homes, and many alternative financing options offer more flexible repayment terms and loan amounts driving the growth of the industry. Another driver of the industry is the lower costs associated with alternative finance products compared to traditional banking products.

For example, online lenders can offer loans at lower interest rates than traditional banks, as they have lower overhead costs and more efficient processes. This is particularly attractive to small businesses and individuals looking for more affordable financing options. Changing demographics also play a significant role in the growth of the industry. For example, the increasing number of millennials and younger generations entering the workforce is driving demand for more flexible and accessible financing options as they seek to start businesses and invest in their financial future. Overall, the industry is driven by a range of factors, including increased access to capital, flexibility and convenience, lower costs, innovation and technology, and changing demographics.

These drivers are helping to make alternative financing a more viable option for individuals and businesses looking for financing options outside of traditional banking institutions. One of the key positive impacts of COVID-19 on the global industry has been the increased demand for alternative financing solutions. Many businesses and individuals have been impacted by the economic slowdown and have been seeking out new and innovative ways to access credit and manage their finances. Moreover, traditional banks have become more cautious in their lending practices, making it harder for many to secure loans, and driving more people towards alternative financing options.

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Alternative Financing Market Report Highlights

• The peer-to-peer lending segment dominated the industry in 2022 owing to the ability to connect borrowers with investors directly, bypassing traditional financial intermediaries such as banks

• This can result in lower costs and more favorable loan terms for borrowers, as they are not subject to the same overhead costs as banks or other financial institutions

• The businesses segment dominated the industry in 2022 as alternative financing can provide businesses with access to a broader pool of potential investors or lenders

• With traditional financing options, businesses may be limited to a small group of banks or venture capital firms. In contrast, alternative financing options, such as crowdfunding or peer-to-peer lending, can connect businesses with a large, global audience of potential investors

• Asia Pacific is anticipated to emerge as the fastest-growing region from 2023 to 2030 as it is home to a large and rapidly growing SME sector, which is often underserved by traditional financial institutions

• Alternative financing providers are well-positioned to serve this regional market, providing SMEs with access to credit and other forms of financing that they might not otherwise have access to

Alternative Financing Market Segmentation

Grand View Research has segmented the global alternative financing market on the basis of type, end-user, and region:

Alternative Financing Type Outlook (Revenue, USD Million, 2017 - 2030)

• Peer-to-Peer Lending

• Crowdfunding

• Invoice Trade

• Others

Alternative Financing End-user Outlook (Revenue, USD Million, 2017 - 2030)

• Individual

• Businesses

Alternative Financing Regional Outlook (Revenue, USD Million, 2017 - 2030)

• North America

  • U.S.

  • Canada

• Europe

  • U.K.

  • Spain

  • Italy

• Asia Pacific

  • Germany

  • China

  • India

  • Japan

  • South Korea

• Latin America

  • Brazil

  • Mexico

• Middle East & Africa

List of Key Players of Alternative Financing Market

• LendingCrowd

• Upstart Network, Inc.

• Funding Circle

• OnDeck

• GoFundMe

• Wefunder, Inc.

• LendingTree, LLC

• Prosper Funding LLC

• Fundly

• Kickstarter, PBC