Companies could be throwing money into a black hole in peer to peer lending.
Prosper Marketplace is in a similar business, offering a kind of peer to peer lending system, attracting a range of borrowers including the underbanked.
Unlike the more traditional forms of lending, there are some additional risks to be aware of with peer-to-peer lending.
He adds that other firms hoping to create peer-to-peer lending businesses have given up after similar warnings.
He also likes the fact that during 2008 and 2009, when the financial system was severely tested, peer-to-peer lending held up to the stress.
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Most borrowers on peer-to-peer lending sites are seeking loans to fund debt consolidation.
It is a pioneer of social lending in Estonia and the oldest peer-to-peer lending platform in Scandinavia.
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Peer-to-peer lending sites are drawing more borrowers and lenders who prefer to make their deals directly with each other.
Now it is possible to do business directly with a stranger, using a peer-to-peer lending site.
Similar to peer-to-peer financing site Lending Club, Mosaic puts the burden on investors to assess the risks in project prospectuses.
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Peer-to-peer lending, or making personal loans via the Internet using websites like LendingClub.com and Prosper.com.
People Capital - People Capital is a revolutionary peer-to-peer lending platform for students.
Commercial peer-to-peer lending, using the web as a conduit, is an emerging business.
David Black, of the information firm Consumer Intelligence, points out that there is one major guarantee missing from these peer-to-peer lending schemes.
So why is the peer-to-peer lending world, where loan seekers with little more than a credit score and a user profile, becoming increasingly popular?
Some of the leading crowdfunders fall into different categories like Equity ( see my earlier post), Donation, Reward and Debt (a.k.a.micro finance and peer-to-peer lending).
And in August, Ron Lieber wrote in the New York Times about options for the fed-up like peer-to-peer lending and the Slow Money movement, where locavore types invest in local food producers.
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Returns on investment on peer-to-peer (P2P) lending sites (a similar funding method) have been in the 10% range.
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Going one step further, peer-to-peer models and online lending circles enable the traditional practice of individuals helping one another without a traditional bank in the middle, but with a technology enabled matchmaker in the middle.
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If you place your money with a peer-to-peer lender like Zopa, you are not lending to Zopa, in the way that you are lending to Barclays if you put your money on deposit with Barclays.
The couple turned to peer lending after realizing they wouldn't qualify for a traditional bank loan.
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Peer-to-peer loan sites, such as Prosper.com and LendingClub.com, allow lending directly between individuals.
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These days Lending Club is one of a handful of peer-to-peer lenders filling a gap created by tightfisted bankers.
But Mike Benson is unimpressed, and is thinking of turning to other lending schemes which do not involve banks, like peer-to-peer lenders.
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