Crowdfunding

Crowdfunding is used by startups or individuals to collect small amounts of money from many people instead of relying on a few large investors.

It is commonly done through online platforms where people can contribute money in different ways, such as:

Donations

Rewards (like early access to products)

Lending (peer-to-peer lending)

This method helps businesses raise funds without giving up ownership or taking loans from banks.

However, success is not guaranteed, and platforms may charge fees.

Example:

If a startup raises ₹10 lakh by collecting ₹1,000 each from 1,000 people through an online platform, it is called crowdfunding.