Posted by John Donovan :: June 12, 2007 @ 8:28 am

Credit Card issuers earn just over $16 for every $100 in outstanding credit card balances. As you can see from the GAO analysis below, almost 80% of that revenue is generated from interest charged, with interchange (merchant fee), penalty fee and annual fee revenue following in the distance. Click the below graphic to view it fully.

Another way to look at the above chart is that borrowing on your credit card will cost you around 16%. We know from this same GAO study that more than half of all credit card accounts carry interest rates above 15%, and this revenue breakdown certainly gives further support.

How does Lending Club compare? If you are planning to borrow money, or preferably looking to consolidate your credit card debt, Lending Club helps you get loans at rates starting just over 7%, with an average interest rate of around 9%. 100% of the interest revenue goes to lenders, typically other people in your community. For comparison purposes, our borrower fees will add between 0.25% and 0.67% to the APR (our loan servicing fee divided by the loan term).

Here is something to think about today. You can help your community, and get better rates. It doesn’t get better than that!
• With Lending Club you will likely receive an average rate of 9.25% (versus a Credit Card you will likely receive an average rate of 16%).
• 100% of your interest goes to someone else, typically in your community, who funded your loan

See compare borrower rates or rates and fees for more information.

Better rates. Together.