Peer-to-Peer Lending: Examining the Industry and the Borrower Experience

Online peer-to-peer (P2P) lending websites, often referred to as “Shadow Lenders”, have gained significant traction since the credit crunch resulting from the 2008 financial crisis. The purpose of these rapidly-growing websites is to facilitate loans of under $35,000 between borrowers and investors. The result is a transparent loan platform where individual investors can determine a borrower’s credit worthiness and partially or fully fund a loan at an attractive interest rate. This slide deck offers background on the P2P lending industry and takes a closer look at the borrower experience by profiling two leading firms in the space – Prosper and Lending Club. Five key takeaways and tips for P2P lenders are also highlighted.