What describes 'peer-to-peer' lending platforms?

'Peer-to-peer' lending platforms are a financial innovation that connects individual borrowers directly with individual lenders, effectively allowing people to lend and borrow money without the involvement of traditional financial institutions, such as banks. This model enables borrowers to access funds often at more competitive interest rates while offering lenders the potential for better returns than they might find through conventional savings methods.

This direct connection between individuals allows for a more community-oriented approach to lending and can also streamline the borrowing process, reducing the time and complexity typically associated with getting a loan through traditional routes. Furthermore, peer-to-peer lending platforms often utilize technology to assess creditworthiness, making them accessible to a broader range of borrowers.

Other options don't accurately represent the nature of peer-to-peer lending. For instance, the platforms are not backed by the government nor exclusively for large businesses, and they don’t merely serve as intermediaries between borrowers and traditional banks. Instead, the essence of their operation lies in the direct connections they create between individual lenders and borrowers, which is what makes option C the correct choice.