Author: wiseclerk

Germany – Do Borrowers on Smava Differ From the Average Population?

wiseclerk

A new study of the DIW Berlin (see page 3-9) (authors: Nataliya Barasinska, Nicola Jentzsch und Dorothea Schäfer) has analysed Smava loan data from the years 2007 to 2011 and found out that people who use p2p lending Smava for borrowing resemble the average population using conventional bank loans. Against expectations there was no major difference in age structure:

Regarding gender there is a gap, 28% of Smava borrowers are female; whereis in the comparison group 40% of borrowers are female. Regional distribution of borrower residence did not differ from average population. Continue reading →

New Study on P2P Microfinance and Zidisha

wiseclerk

Sander van Damme has written the master thesis ‘Peer to peer Microfinance: the case of Zidisha.org‘ at the Louvain School of Management (Belgium). The 70 page study dives deep into analysis of Zidisha‘s complete loan portfolio (Q4 2009 – Q1 2011). It offers a very comprehensive overview on the p2p microfinance operations of Zidisha, the motivations of lenders and borrowers and developments of the interest rates on the marketplace.

Excerpt from the conclusion:

When looking at the trends in social media, the propagation of the internet and the innovations in mobile banking, we believe this website offers us a glimpse of what the future of aid and banking will look like. Although not necessarily a mainstream tool for everyone on this planet, it will surely become part of many a person’s portfolio. Rather than donating anonymously to some big NGOs who will use the money for projects we do not know about; people want to see their impact and be able to connect with each other across the globe.
Whereas we set out to discover whether peer to peer microfinance was a viable solution in the first place, we came across a business model that in the long run could allow both investors and entrepreneurs to profit from their exchange.

Funding Circle Allows Multiple Loans and Higher Risk Loans

wiseclerk

Funding Circle will allow multiple loans by the same borrower and also open up to “C” rated borrowers which were so far excluded from loan funding. These changes will be enacted on Sept. 19th. In the blog Funding Circle explains the reasoning for allowing multiple loans:

Businesses typically have multiple finance needs throughout the year, for example they may need finance to purchase new assets or to fund new projects. Previously at Funding Circle, businesses were restricted to one outstanding loan. Many of our borrowers have come back to us with new finance needs and until now we have not been able to help them. In addition, a number of very creditworthy businesses have previously borrowed up to 50,000 GBP with Funding Circle when our maximum loan limits were lower, but which would have always passed our underwriting models for larger loan amounts (our current maximum is 100,000 GBP). …

and for introducing “C” band loans: Continue reading →

Growth and other Recent News in P2P Lending

wiseclerk

Zopa has announced that it reached the milestone of 150 million GBP in loans facilitated. Zopa says the new loan volume per month accounts for between 1% and 2% of new personal loan volume made in the UK.

P2P lending service Lending Club announced yesterday that it has been selected as a World Economic Forum 2012 Technology Pioneer. Lending Club was selected from amongst hundreds of applicants from around the world that hold the promise of significantly impacting the way business and society operate.

Both Lending Club and Prosper did continue their growth of monthly loan volume origination in August (Sociallending.net has charts and company comments).