While online platforms may never replace conventional lending institutions, such as banks, it is important that the community development finance industry be aware of this emerging technology. Moreover, P2P finance platforms will continue to evolve—allowing for third-party issued loan sales, for example—which may fundamentally alter the way credit is allocated in the future. In either case, the potential community development finance implications are too significant to ignore.
Microplace.com (an eBay company) initially started with interest rates of up to 3% on offer. Over time the highest offered interest rate has risen. Currently the highest interest rate offer at Microplace is 6%.
social lending services enabling micro financing (e.g. Kiva, MyC4) – participants driven mainly by social motives
other concepts (e.g. Virginmoney which is special in the way that it does not do the matchmaking between borrowers and lenders, but supports the process between persons that already had offline relations- slogan “We manage loans between family and friends“)
Sites funding student loans can fall into any of these three categories or combine motivations.
P2P-Banking.com has created the following overview table listing services that are in operation and ranked them by loan volume. The loan volumes are not directly comparable for they are cumulative since launch of each service and represent different time spans.
Asked for a figure, a Microplace spokesman pointed out “…it is important to note that MicroPlace is not a P2P site. We are a platform that offers investments to the retail public.“. No loan volume was quoted, but he stated “investments purchased on our site have enabled over 26,000 microfinance loans.”
In total approx. 685 million US$ have been funded through peer to peer lending/social lending services so far worldwide.
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If you are a representative of a p2p lending service and want your service to be included in the next update of this table, please send me an email with information about your company.
I noticed prominently displayed Microplace ads on Technorati.com today. Not sure if it is really keyword-targeted or rather context targeted. When I did searches on Technorati on Globefunder or Kiva I was shown Microplace ads.
Technorati is an interesting choice for the campaign (if it runs only there – I did not check). Technorati is mainly used by bloggers and journalists. The ads would therefore target not the individual investor but the multiplier who might write about Microplace. I noted that the ad display is NOT using geotargeting meaning it is not only shown to US residents but to viewer worldwide (only US residents can use Microplace at the moment).
(Sample screenshot after search for globefunder)
(Another sample ad, original is larger and flash animated)