Social Lending: Difference between revisions
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Social Lending is another name for the trend of people lending/borrowing money to each other without the intermediary of a bank. | Social Lending is another name for the trend of people lending/borrowing money to each other without the intermediary of a bank. | ||
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"The basic idea with social lending is that when you need money, others will pool their funds together and lend them to you at x% interest rate. Prosper uses your credit score to determine your risk rate and then based on that risk rate you bid for the loan with your terms. What makes Zopa & Prosper popular is the "social" aspect; that is you can post your story about why you need the money." | "The basic idea with social lending is that when you need money, others will pool their funds together and lend them to you at x% interest rate. Prosper uses your credit score to determine your risk rate and then based on that risk rate you bid for the loan with your terms. What makes Zopa & Prosper popular is the "social" aspect; that is you can post your story about why you need the money." | ||
(http://www.centernetworks.com/social-lending-web-2- | (http://www.centernetworks.com/social-lending-web-2-0) | ||
Revision as of 00:26, 13 May 2007
Social Lending is another name for the trend of people lending/borrowing money to each other without the intermediary of a bank.
It is also covered under our entries of P2P Finance and P2P Lending
Definition
"The basic idea with social lending is that when you need money, others will pool their funds together and lend them to you at x% interest rate. Prosper uses your credit score to determine your risk rate and then based on that risk rate you bid for the loan with your terms. What makes Zopa & Prosper popular is the "social" aspect; that is you can post your story about why you need the money." (http://www.centernetworks.com/social-lending-web-2-0)
More Information
3-part article on social lending starts here at http://www.centernetworks.com/social-lending-web-2-0
115 page report on the history of social lending, with case study of Zopa, at http://www.socialfuturesobservatory.co.uk/pdf_download/internetbasedsociallending.pdf