Trustbuddy – P2P Lending Service Listed at Public Stock Exchange

wiseclerk 3 Comments

I have been aware of Trustbuddy for some time. They are (at least internationally) pretty unknown since they do not do much marketing. I have only once written about them before, in order not to give publicity to a company which charges interest loans for rates in a height, that I deem could be called usury (on moral grounds not on legal grounds).
According to their own published figures on the site the current ‘Effective annual interest’ for a one year loan varies between 219% and 852% (733% to 5102% for a one month loan).
While Trustbuddy calls itself a p2p lending service, their rates are somewhat closer to Wonga (see Need a loan at 2334 percent APR).

Why do I now write about Trustbuddy then?

Well ignoring them, won’t make business models like these  disappear. And it seems to be profitable for the service as well for lenders as per the numbers that Trustbuddy supplied P2P-Banking.com.

But the main questions I ask lenders is: Do you feel it is ethical to earn the 12% p.a. interest rate given the costs the borrowers are charged? If you answer this with yes for yourself, then Trustbuddy may be a good choice for you.

Furthermore Trustbuddy is one of few companies in this business that have a drive for international expansion. Remember they bought Loanland operations earlier.

The following is information supplied by Trustbuddy:

TrustBuddy AB (2009), a Swedish P2P lending facilitation company. Using in-house developed and proprietary mobile-/web-based financing solutions, it facilitates smaller short-term loans between private consumers. The company does not lend out its own money; pooled loan-portfolio investors provide funding. TrustBuddy has already reached close to 40,000 registered members, of which more than 20,000 are active customers, in Norway and Sweden alone. This is done with virtually no marketing efforts, showing how popular the product is. Continue reading →

Lending Club Nearing Break Even

wiseclerk

Peter in an article over at SocialLendingNet has collected some interesting statements showing that Lending Club is close to be able reaching break even on cash flow terms.

Renauld Laplanche told him, that Lending Club  has topped 1 million US$ monthly revenue and could thereby cover it’s operating expenses, if investments in the future (technology, marketing) are disregarded.

Lending Club is the second major p2p lending service after Zopa to approach break even.

Lending Club is still a long way from making profit as it has a long way to go to redeem the money invested in the platform over the past years. But the growing volume and the ability to cover expenses a very good signs that p2p lending services can scale to profitability.

390,000 US$ P2P Loan Funded via Rebirth Financial

wiseclerk 2 Comments

Rebirth Financial announced that it facilitated a 390,000 US$ loan via it’s social lending platform to NOLA Brewing Company. You can read more about NOLA Brewing company here.

The press release says: “In the case of NOLA Brewing, Rebirth Financial matched the loan to ASI Federal Credit Union in less than one week. ‘Rebirth’s process was quick, easy, and helped us raise the necessary funding to can our beer,’ said Dylan Lintern, Vice President of NOLA Brewing Company.“.

If I read this right and the loan was funded by just one institutional lender you can hardly file this under Rebirth Financial’s claim “Rebirth Financial Inc. debuted America’s first person-to-business lending platform … in February. It allows people to lend small sums of money to small businesses in their community.“. I wrote to the founder Chonchol Gupta who replied: “This loan started as a p2p loan but was fully funded by the credit union, who would not have seen the loan or perhaps given thought to it, if it was not for the groundswell of community interest. Banks see it as great PR to fund loans important to the community.“

Recent News from P2P Lending Blogs

wiseclerk 1 Comment

Here are some recently published articles on several p2p lending topics:

Sociallending.net: The Best Day to Borrow Money at Lending Club

P2P Lending News: Prosper and Lending Club Compete for Investor Market Share

CreditUnionTimes: Consultant Warns Banks and CUs Risk Becoming Passé

DoughRoller: Lending Club Investment Strategy (Update)

Janari Rahablog: Omaraha.ee laenude vahenduse portaal

GlobalVoices: Brazil: Crowdfunding Potential

The Merge of P2P Lending and Crowdfunding

wiseclerk 3 Comments

P2P Lending and crowdfunding are two totally different concepts you say? True so far.
P2P Lending means the lender loans the borrower money. The amount is repaid together with interest.
Crowdfunding is usually applied to describe concepts were a crowd decides to finance project. The motivation there is to see the project getting done. The funds are not paid back but spent on the project and investors are sometimes rewarded with the art or products that are a result of the project. A good example for a crowdfunding platform is Kickstarter, which P2P-Banking.com covered earlier – see article: ‘Kickstarter – Pledge Money to Fund an Artist‘.

Moneyauction creates ‘Reward Funding’ – merges P2P Lending and Crowdfunding

Moneyauction, a leading p2p lending service in Korea, now announced their ‘reward funding’ option. Continue reading →