loans

MyC4 – more then 1000 loans funded

wiseclerk

MyC4 has successfully funded 1000 loans to entrepreneurs in Africa since launch in May 2007. So far none of the loans has defaulted and average interest rate for lenders is 11.7%.
Tim Vang, one of the co-founders of the Danish startup told P2P-Banking.com that the MyC4 will release a new version in May with a new design and better interface. MyC4 also plans to provide loans in additional countries (currently Uganda, Kenya and Cote d'Ivoire).

MyC4's annual report 2007 is available on the Internet (English and Danish). While the company realised a loss of 2.8 million DKK (approx. 0.6 million US$) in 2007, it aims for break even in 2009.

MyC4 loan growth 
(Source: MyC4 loan statistics, Wiseclerk.com, Apr. 19th)

Big news – Prosper goes national with 36 percent max interest rate

wiseclerk 2 Comments

Announced today Prosper.com has achieved nationwide lending (exceptions South Dakota and Texas) with an interest rate maximum of 36 percent. Previously maximum interest rates varied on a state by state basis depending by the licenses Prosper had acquired.

Prosper chose the same construct to go national as did Lendingclub in December – both partnered with WebBank, Utah.

All loans originated through the Prosper marketplace are made by WebBank, a Utah-chartered Industrial Bank. Prosper provides services to WebBank in connection with the origination of such loans and Prosper services loans made to Prosper borrowers on behalf of registered Prosper lenders who purchase such loans.

This step has good potential to multiply the monthly loan volume originated by Prosper, as chances for obtaining a loan were in the past harmed in some states by low state interest rate caps (especially for lower credit grades).

Cashare launches first p2p lending service in Switzerland

wiseclerk 1 Comment

Swiss Cashare.ch recently launched as the first p2p lending platform in Switzerland. The company, owned by Michael Borter (link to German language interview) and Roger Mueller has partnered with the collection agency C&S Credit Management AG, which handles all monetary transactions.
Interest rates and loan durations are set by borrowers and lenders bid in a 14 day auction (minimum bid amount is 500 CHF which is approx 500 US$). If the loan is fully funded further bids in the remaining auction period will cause the interest rate to drop in 0.1 percentage steps, while old bids are outbid.

The fee schredule includes:

  • For lenders and borrowers: 5 CHF fee for identification process
  • For borrowers: 19 CHF listing fee
  • For borrowers: 0.75% of the loan amount per year servicing fee
  • For lenders: 0.75% of the loaned amount per year servicing fee

This results in borrowers having to pay even if their loan does not fund.

An unusual point in the process is that lenders have to sign a written contract for each successful bid and send it via postal mail to Cashare. That seems a bit uncomfortable to handle. 

As Cashare launched only recently there currently are only 4 active loan listings. 

If you have used Cashare as a borrower or lender, please share you experiences in the forum. Thank you.

Kiva to reach 25 million US$ loan volume

wiseclerk 1 Comment

Kiva.org, which allows everybody to help funding microloans to entrepreneurs in developing countries, will achieve the milestone of 25 million US$ loan volumn within the next two days.

Launched 2005 the amazing growth curve can be seen on this Kiva stats page. The growth accelerated in 2007 driven by major media coverage. Up to now more then 260,000 individual lenders have funded more than 37,000 loans in 42 countries.
The current default rate is only 0.11%. While Kiva lenders do not receive interest, borrowers pay interest to the local Kiva Field partners (microfinance institutions).

Kiva, founded by Matt and Jessica Flannery (picture), is  a non-profit which currently has 16 employees paid by optional 10% lenders can donate on top of loans. Apart from them many volunteers aid the Kiva cause.

A February 2006 survey showed that Kiva donors were evenly distributed between 25 and 60. Slightly over half were males, and 65% made more than $50,000 a year. But a $25 cap on individual donations is causing the demographics to spread; more older, younger, and less-well-off people are signing up. Kiva has about 15,000 to 20,000 visitors a day coming to the site now.

While lenders may withdraw funds via Paypal upon repayment, 90% decide to reinvest the money into new loans.

(Picture courtesy Kiva.org)

Lending Club hits 10 million US$ loan volume

wiseclerk 1 Comment

P2P Lending service Lendingclub.com, which launched last May, today surpasses 10 million US$ in loans. While the total amount is still much lower then the loan volume of competitor Prosper.com (currently over 120 million US$ loan volume) the growth acceleration of Lendingclub is really impressive.

Rob Garcia, Director Web production at Lending Club, told P2P-Banking.com:

This milestone confirms the validity of our approach to person-to-person lending, but more importantly, our value proposition to our borrowers and lenders.  Borrowers are realizing 20-30% better rates than going through the banks, while our lenders enjoy 12% average returns.  We are working to take this concept to a larger audience, so $10M is just a mile marker in our marathon.

The growth can be seen in this chart. For Prosper loan volume compare chart on this page. So basically in February Lending Club has originiated close to the amount Prosper did, when taking into account only those loans that would fit the minimum criteria of Lending Club's 640 FICO score and <30% DTI.

The statistic information at Lendingclub.com shows that over 1200 loans have been issued. So far few loans are late, but since most of the loans are very young, it is to early to tell which level of defaults will have to be expected. The statistic page also shows that Lendingclub declined over 80 million US$ in loan applications.

If you sign up via this link, you get a 25 US$ bonus by Lending Club (and I am paid a referral fee).

More p2c lending

wiseclerk

German startup Valuna.de wants to help companies to raise capital through loans from private investors without a bank. The first offer is by printing service QuickPrinter which offers 15 percent interest for a 7 year 100,000 Euro loan. Minimum amount for investors is 100 Euro. The platform Valuna offers marketing, but does not handle the financial transactions which are conducted directly between the lenders and the company. More information in an detailed article on the Valuna launch (German language).