In April 2005, we wrote about British Zopa, a person-to-person lending marketplace which we described as eBay for money. Recently, a similar initiative was launched in the US – Prosper.
As described by Chris Larsen, co-founder of Prosper: "Prosper gives people the opportunity to take back the marketplace for consumer credit. By providing the platform and tools for an efficient marketplace created by and for people, Prosper aims to make consumer lending more financially and socially rewarding for everyone."
How it works? People who need money request it, with a listing of why they need the money, and some numbers describing their credit rating. Other people then bid for the privilege of lending money to them. The lower the interest rate offered by the lender, the more likely he is to win the bid. Prosper facilitates, in return for a one-time 1% fee on funded loans from borrowers, and a 0.5% annual loan servicing fee from lenders.
Compared to Zopa, Prosper has added a number of community elements, the most important one being groups. Designated group leaders confirm that everyone in the group is real, and by joining a responsible group with a good payment history, borrowers get a good reputation by association, and lenders are more likely to offer good interest rates. Belonging to a group also adds old-fashioned social pressure: if a borrower stops making loan payments, he'll bring down the group's reputation with his own.
Let's face it: most banks suck, are paid huge amounts for providing terrible service, and are completely stuck in a 'provider versus consumer' mindset. Which means plenty of opportunity to shake up the industry. Start a Zopa or Prosper in Germany or Singapore, or, if you're an entrepreneur looking to fund a new business, why not cut out the middleman and go straight to the people? (Oh, and if you're a lender – make sure to diversify your loans. You can't trust 'em all ;-)
A new innovative group on Prosper.com called "Two Millionaires cover High Risk Loans, Restore Credit" is helping ordinary people prosper by providing a way for them to get a series of small loans at interest rates below 30% to move their credit grades from HR high risk to B or better.
In less than a month this unique group attracted 200 members, placed 10 loans, and had 50 active listings.
Two Millionaires is helping high risk borrowers who can't attract lenders even in the socially exciting Prosper.com people to people market. The goal of the Two Millionaires founders is to help sincere high risk members get to the point where they qualify as Prosper.com lenders and group leaders themselves.
Two Millionaires attracts lenders by offering a large selection of quality listings at high interest rates, and an opportunity to help others.
https://www.prosper.com/public/groups/group_home.aspx?group_short_name=Mayans2
Do you have to spam everywhere? Can't you just comment on the article without plugging your lame group?