Lending Club, the Facebook exclusive person-to-person lending service has passed the $100,000 mark in loans to Facebook users.
Lending Club was an original Facebook Platform/ F8 partner having launched with F8 on May 24. The company closed its first loan on June 6, and has since closed 27 more loans for a total of $101,250. An additional $212,650 in loans will close in the next 12 days. More than $180,000 is currently available from 271 lenders with around 10-15 new lenders transferring money to Lending Club every day.
The social networking angle of Facebook allows Lending Club to leverage trust by enabling lenders to find borrowers within shared networks. Lending Club uses technology to pair the two parties based on shared connections without giving lenders direct access to the borrowers Facebook profile.
P2P lending is a rapidly growing market. Lending Club faces stiff competition from companies such as Zopa, CircleLending and Prosper. Although it may not be the market leader in terms of volume, Lending Club’s growing success demonstrates the potential of Facebook as a sales and finance platform.
http://www.abstract10.com
We are self funded and looking for potential investors. For a business plan request please email jbirdmobi@yahoo.com
Big congrats to my boy Rex who handles their blog. Amazing stats already.
When I did the 3 part series on social lending earlier this year, it was wildly popular and I never thought this was such a big topic. But alas, the feedback since then says it is.
http://www.centernetworks.com/.....ng-web-2-0
Wow. Some ingenious new business models are coming from F8. I never thought one company could spur the creation and growth of so many others the way Facebook is currently.
I don’t understand why LendingClub’s model is such a constructive use of Facebook. They tout the interconnectedness and “trust” behind Facebook, but then hide everyone’s identity, and instead make you rely on nebulous and meaningless Facebook groups.
Perfect example: “Largest Facebook Group Ever”, is listed as one of the “top groups” in the screen shot above. How is someone’s membership in that group supposed to help me decide whether or not to lend them money?
P2P lending on social networks - simply brillant!
Adam,
I must admit we’ve struggled with that one. It’s a delicate balance between exposing connections and protecting privacy. The way we’ve solved this for now is by leaving it to the borrower to decide to link his Facebook ID to his Lending Club screen name or not (by picking up the same name and/or installing a widget on his Facebook profile page). Also, lenders and borrowers are matched based on groups/networks and connections as “friends”.
Some Facebook groups/networks are certainly more meaningful than others: school networks like MIT or Stanford are usually found more relevant to help lenders make decisions than belonging to “If you remember this you grew up in the 90s”
Renaud from Lending Club
spam alert!
please remove spam from http://www.abstract10.com.
This is an excellent use of the F8 platform, and while there are a few issues, they can be worked out over time. What I want to see is a real “bank” in facebook.
bb dont spam alert me, i use just about every service on here, and just about everyone gives their web address, dont hate on me bro!!
jason jenkins
http://www.abstract10.com
BB
i bet ive done 10 times for the web than you will ever do, I DONT SPAM, I PARTICIPATE FOOL!! BEEN HERE SINCE 97!! HELP BUILD THIS INET, BOY!
heh - honestly /
- abstract10; If you want your site to be taken seriously it should atleast load properly in a 1024 x 768 … and most like even in a 800 x 600 ….
- IE (goog, MSN, Yahoo ((90% of most sites)
lol, Chad Hurley has come back in comments as Mark Zuckerberg! Who is this wierdo?
Concrete Stain
Your wish Is My Command, Any other suggestions? We are open to them.
thx
jason jenkins
http://www.abstract10.com
I go have surgery, and we get on TechCrunch! hahahha… My luck! Thanks guys for covering us. Nice post.
Rex
Great fake post by “Mark Zuckerberg” who in all the articles I have read, is genuine and humble.
I wonder how much of this leaned money went straight to the online poker sites???
As if college students weren’t in enough dept already.
Wow lenders are sure to lose money there, with a rate cap of 11.68% you can really lend to the best of borrowers in the Prime category.. Ones defaults hit lenders will be crushed…
Social lending on social networks is a GRAND idea. It is the only chance for p2p lending to go mainstream. Many online communities will benefit from their own efficient credit unions (P2P lending is not new — just low cost credit unions online). I hope that Lending Club goes beyond Facebook. But maybe the company could be less restrictive on borrowers — currently only borrowers with FICO over 640 are allowed.
Banks are always looking for alternate ways to isolate acceptable credit risks. It’s easy to find qualified people to lend to, much harder to find people who look bad but actually are low risk. They’ve pretty much maxed out using the traditional criteria so if a company can figure out how to do it with social networking, it could be huge. My advice would be to perfect the algorithms and then sell at a very high price to FICO or one of the big banks. Good luck!
I may not even be able to spell it right but “disintermediation” seems to be the key word here. Almost all functions of a bank can now be outsourced (marketing to Facebook, credit scoring to Experian/Equifax and so with identity verification, money transfer, billing, bad debt collection, etc.). Lending Club seems to be just a virtual bank — the ultimate outsourcing machine where even borrowing and lending is outsourced :). TechCrunch rules because it writes about great new ideas!
Marc,
Rates actually go all the way up to 18% for the most “risky” loans. The 11.68% rate is the expected net return AFTER defaults for a “G” portfolio (ie the most risky on a scale of A to G). You can find more information on rates, expected defaults, and expected returns at:
https://secure.lendingclub.com/info/check-borrower-rates.action and
https://secure.lendingclub.com/info/compare-lender-rates.action
Renaud from Lending Club
Marc,
Rates actually go all the way up to 18% for the most “risky” loans. The 11.68% rate is the expected net return AFTER defaults for a “G” portfolio (ie the most risky on a scale of A to G). You can find more information on
our site about rates, expected defaults, and expected returns.
Renaud from Lending Club