Archive Links

Consumer Archive
CU System Archive
Market Archive
Products Archive
Washington Archive
150x172_CUEffect.jpg
Contacts
LISA MCCUEVICE PRESIDENT OF COMMUNICATIONS
EDITOR-IN-CHIEF
MICHELLE WILLITSManaging Editor
RON JOOSSASSISTANT EDITOR
ALEX MCVEIGHSTAFF NEWSWRITER
TOM SAKASHSTAFF NEWSWRITER

News Now

CU System
Peer-to-peer lender back with service to connect FIs
NEW YORK (4/29/09)--Peer-to-peer lender Prosper Marketplace Inc. Tuesday relaunched a new service, "Open Market," which will enable financial institutions to resell loans to its investors, including small businesses. By offering loans to investors willing to bid on them, banks, credit unions, auto-finance companies and others gain access to funds they could use to make loans to more people, at a time when capital markets have largely been frozen, said the company (The Wall Street Journal April 28). Prosper shut down most of its peer-to-peer lending operations last October, according to the Journal, after it and similar lenders fell under increased scrutiny from regulators. Peer-to-peer lending still contains risks, said the article. The average lender return since the company was established in 2006 is 2.8%, after defaults. In March 2007, Prosper began providing more information about borrowers' credit and employment histories, and that improved lender returns to 4.8%. Prosper says investors benefit with potentially higher interest rates on loans that have already been vetted by a financial institution, are current, or have at least three months' payments already paid. But unlike traditional securitization markets that package loans into complex bundles and sell them to investors, Open Market will provide details about each loan to investors. Because Prosper's registration process is still ongoing with the Securities and Exchange Commission, it is operating under an intra-state exemption from the California Department of Corporations. That means only California residents and businesses can lend or invest in Prosper's loans, although it accepts loan applications from borrowers across the country. After the SEC registration is complete, however, financial institutions and lenders in other states will be able to use Open Market.


RSS





print
News Now LiveWire
What role are #creditunions playing in @gatesfoundation's 2030 vision of financial services? Read #NewsNow Monday
3 hours ago
Consumers fear inaccurate info lingers on credit reports, says @FTC study Read @CUNA's News Now: http://t.co/RzNLMnaROO
5 hours ago
@PCUA has formed a @LinkedIn networking group for former bankers turned #creditunion employees.
5 hours ago
.@politico reports Democrats haven't picked the city yet, but their 2016 convention will be held the week of July 25.
5 hours ago
.@cuna, @DCUC_HQ urge @CFPB to exempt #CUs from changes to Military Lending Act rules cuz CUs aren't part of the targeted problem. NN Monday
7 hours ago