Lending Club: borrowers and lenders can work in harmony
Trust, relationship, and money are words that should go great together. Today’s banking system, especially as it relates to unsecured loans and credit cards, does not fully recognize trusted connections and relationships. Lending Club is changing that.
Facebook provides Lending Club with a solid platform of potential borrowers and lenders. These users are connected via alumni relationships, geographic relationships, and hundreds of others. While no one trusts every Facebook friend, what’s critical is that they are not completely anonymous. Borrowers can decide to keep their identity anonymous and disclose only the groups and networks they belong to. In this case, the privacy of the borrowers is protected but the lenders gain valuable information such as verified affiliations to university or companies. Borrowers can also decide to publicly link their Lending Club anonymous screen name to their Facebook profile, and invite friends and members of their groups to lend them a hand.
We use the best of the financial system and banking infrastructure to take care of the rest of the problem: we verify identity, credit score and bank account, and handle electronic payments through our partner Bankserv, a financial service processor that supports over 400 banks in 52 countries and operates a PCI-compliant data center.
The lender feels safe, as they know that Lending Club pre-screens all potential borrowers. We pull a credit report on each borrower. Facebook members that are interested in borrowing must have a 640 FICO score or greater to qualify for a loan. Therefore, we do not facilitate sub-prime borrowing.
All borrowers’ identities are verified. Their privacy is not compromised, but we must be confident the person is who they say they are. The lender can feel secure in knowing that the screening process is all handled just like a bank or credit card company. We have obtained all the necessary licenses to be a lender.
We do not share personal information, or sell it. We couldn’t be in a trust-based business if we did! The only entities that receive updates are credit agencies and, when needed, collection agencies.
We are presenting another, and new, financial option to Facebook users. This option leverages trusted relationships and connections. We present a more human option.
Tuesday, May 29th, 2007 at 10:11 am