Peer to peer lending
Friday, November 2nd, 2007Last week’s Economist has an interesting article (”Crunchless credit“) on how the recent credit crunch affects peer to peer lending services such as Zopa and Prosper.
Apparently, private lenders haven’t raised their rates as much as the banks have because unlike the banks, they don’t face higher funding costs. The article highlights the intriguing point that peer to peer lenders might possibly be better at assessing risk than the bigger players.
On a related note, a new peer to peer lending site called MicroPlace launched recently. It allows users from industrial countries to invest in start-ups from the developing world.
