Peer-to-peer lending is a method of borrowing and lending money directly between individuals, bypassing traditional financial institutions like banks. In this system, borrowers can request loans, while lenders can offer funds, often through online platforms that connect them. This allows for potentially lower interest rates for borrowers and higher returns for lenders. The process typically involves creating a profile on a lending platform, where borrowers provide details about their financial needs and creditworthiness. Lenders can then review these profiles and choose to fund loans that match their investment criteria, making it a more personalized approach to financing.