p2p lending

Impact of Kenya’s crisis on p2p lending operations

wiseclerk

The unrest after elections in Kenya might also to some degree impact operations of Kiva and MyC4 which are funding p2p loans in Kenya. As Jessica Jackley Flannery of Kiva reports operations of the local MFIs in Kenya have been interrupted:

The situation on the ground appears to vary widely from community to community. However, one consistent report is that business is not operating as usual; most MFI operations have been interrupted or stopped altogether in the last week, whether due to imminent danger in their region or the general disruption in daily life caused by turbulence elsewhere. Thankfully, as far as we know, none of our partner MFI staff have been hurt. Unfortunately, due to the magnitude of the situation, we anticipate that many entrepreneurs will have been displaced, hurt, or otherwise adversely affected.

Please be patient as this situation unfolds. We expect possible disruptions in our Kenya MFI partners’ operations as the staff on the ground recover.

On MyC4.com the local provider Growth Africa Capital writes from Nairobi, Kenya:

It probably hasn't escaped your attention that the Kenyan elections didn't go a smoothly as we had all hoped and has resulted in a lot of unrest, violence, destruction and even deaths.

As I type (noon, 2nd January) things are slowly getting back to normal in Nairobi. The situation is also improving in Mombasa, though we are yet to get the same good news from the central Rift Valley, Western and Nyanza provinces.

We should have a full overview in terms of the wether any of the opportunities funded via MyC4 has been affected by the unrest by Monday (7th January).

Once safe to do so, we will look at the areas in Nairobi affected by the unrest and wether affordable funding will make a difference in the affected people's lives in terms of re-establishing their businesses. So stay tuned for opportunities that will help get Kenya and its enterprising people back to normal – your investment may make a huge difference.

While the situation in Kenya is somewhat unclear, the crisis is already impacting Uganda's economy. MyC4 only recently started in Kenya. The majority of loans are to entrepreneurs in Uganda. 
Ronald Isabirye of the local provider in Kampala, Uganda about the consequences: Continue reading →

Review of peer to peer lending developments in 2007

wiseclerk

2007 was an exciting and eventful year in the development of peer to peer lending. Looking back these were the highlights:

I will write another article on which trends to expect in p2p lending in 2008.

Loanland launches peer to peer lending in Sweden

wiseclerk 2 Comments

Loanland.se is the first Swedish p2p lending service. Founder Daniel Kaplan, who in 2006 headed the successful sale of Swedish auction site Tradera to Ebay for 48 million US$, sees a great potential for peer to peer lending in Sweden.

At Loanland, borrowers with the best credit grade can borrow up to 300,000 SEK (approx 45,000 US$), while borrowers with the lowest admitted credit grade can borrow up to 3,000 SEK (approx 450 US$). But borrowers are able to achieve a better credit rating by paying back on time and then can later borrow a larger amount, says Kaplan.

As of today the site had 4 loan listings with interest rates between 4 and 14 percent. Minimum bis seems to be 250 SEK (38 US$). Loan term seems to be customizable as 3 of the current listings are for 3 years and one is for 1 month.

Loanland is backed by experienced entrepreneurs. Aside Kaplan there are Mary Groschopp, before at OMX, Peter Nordlander, founder of Avanza, Peter Settman, founder of Baluba.

If you use Loanland please share your experiences in the wiseclerk forum.

Sources (1,2,3,4 all in swedish language)

Zopa US launch next week

wiseclerk

According to the Wall Street Journal p2p lending service Zopa will launch in the US next week. Zopa has been established in the UK since 2005. The long announced US start had been postponed several times due to regulation issues.

In the US Zopa will partner with six credit unions. Lenders will benefit since they can be sure to get their principal back – deposits are insured up to $100,000 per member. This is new for p2p lending, where lenders usually carry the default risk (only Dutch p2p lending service Boober.nl guarantees for certain credit grades the bulk of the pricipal via insurance against default.
According to the WSJ article neither lenders nor borrowers will have to pay fees to use Zopa but have to sign up with one of the six participating credit unions.

An article on Netbanker.com already spoke of congestion, since Globefunder and Loanio will launch at a later stage and Prosper, Lending Club and Virgin Money are active in the market.

What's your opinion on this? Post your thoughts in the wiseclerk forum!

Evolving Wiseclerk to a p2p lending information exchange

wiseclerk

As some of you might have noticed, the main page of Wiseclerk.com changed today and now offers a p2p lending discussion forum. I believe there is a huge need for information on the developing p2p lending services. In this spirit I started Wiseclerk.com in April 2006 to create useful overview reports on Prosper. While it was not the first site of this kind (some oldtimers may remember Savagenumber.com by atlantageek) it did grow quickly and built a loyal userbase among Prosper lenders.

Prosper did from the beginning support the efforts of developers by providing data publicly and later offering data export interfaces and APIs.

Both the Wiseclerk reports and the later added blog were started with a focus on Prosper. That was appropriate at that point in time but now I think a broader view is needed. Lenders can choose between several p2p lending services and the flow of information needs to be taken to a meta platform level. Lenders that lend on several platforms will not want to check several forums – each one tied to the single platform.

The new forum will also serve as a feedback and discussion location for ideas and news published in the p2p-banking blog. Later today I will add a display into the blog that shows the latest discussion threads from the forum.

Continue reading →