Decentralized Lending

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Just as the Decentralized Finance world is expanding and trying to be mainstream, I just discovered there is a decentralized lending and borrowing. The beauty of decentralized lending should be the ability to have access to loans or give loans without middle men, restrictions based on nationality or location. Unlike the usually centralized financial institutions like the banks, you need to have a credit score to be eligible for loans. This decentralized nature of this service is due to smart contracts.

This lending and borrow service is made possible through peer-to-peer Dapp platforms. The decentralized way of lending is way smarter and different from the usual centralized way.

Could it because of its smart contract use? Pun intended

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For anyone trying to borrow funds on any of the decentralized platforms, they need to have funds that are larger than the amount of funds they want to borrow.
This means that for you to have access to let’s assume $30 you need to have at least $90 in your wallet. This is really smart because this way, the system makes sure that the owner of the funds being lent to the person borrowing is paid back in time without hassle. And they earn interest as well. The borrower pays interest too when paying back.

Some of the Defi loaning platforms are Aave , Compound, Cream Finance , Liquity, Unit protocol & Venus