The Latest Threat to Online Lenders
Many online lenders have not detected the “stacking” of multiple loans of borrowers who slip through their automated underwriting systems. Online lenders sometimes have hurried, algorithmic underwriting, usage of “soft” credit inquiries and patchy reporting of resulting loans to credit bureaus. The practice is currently proliferating in the sector – led by LendingClub, OnDeck and Prosper Marketplace
“The marketplace lending industry – which last year hit $18 billion in annual loan originations.”
New revelations of loose lending could make it harder for the sector to win back trust from concerned investors. The marketplace lending industry – which last year hit $18 billion in annual loan originations – has seen plummeting share prices and the retreat of some major backers, including BlackRock and Citigroup.
Related Reports: Reuters
About Lending Club
We are the world’s largest online credit marketplace, facilitating personal loans, business loans, and financing for elective medical procedures. Borrowers access lower interest rate loans through a fast and easy online or mobile interface. Investors provide the capital to enable many of the loans in exchange for earning interest. We operate fully online with no branch infrastructure, and use technology to lower cost and deliver an amazing experience. We pass the cost savings to borrowers in the form of lower rates and investors in the form of attractive returns. We’re transforming the banking system into a frictionless, transparent and highly efficient online marketplace, helping people achieve their financial goals everyday
Visit: Lending Club
We’re 100% focused on small business. We launched OnDeck in 2007 to solve a major issue facing small businesses: financing. We combined our passion for Main Street with cutting-edge technology to evaluate businesses based on their actual performance, not personal credit. That’s enabled us to say “yes” more often and faster than traditional lenders. And that lets owners spend their time where it should be—on growing their business, not seeking financing.
About Prosper Marketplace
Prosper is America’s first peer-to-peer lending marketplace, with more than 2 million members and over $6 billion in funded loans. Prosper allows people to invest in each other in a way that is financially and socially rewarding. On Prosper, borrowers list loan requests between $2,000 and $35,000 and individual lenders invest as little as $25 in each loan listing they select. Prosper handles the servicing of the loan on behalf of the matched borrowers and investors. Prosper Funding LLC is a wholly-owned subsidiary of Prosper Marketplace, Inc.
Visit: Prosper Marketplace
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