Lending Club Extends Privacy Protections for Borrowers
At Lending Club we pride ourselves on embracing new technologies and open communication, but we’re also very aware that we provide a financial service that calls for a very high standard of privacy and identity protection.
To that end, we have implemented a change that will reduce the possibility of exposing personally-identifying information about borrowers. Starting today, instead of writing a free-form loan description, borrowers will simply choose a loan purpose. In addition, borrowers will no longer be able to answer questions.
Historically, borrowers were able to provide a free-form description of their requested loan, and to answer in free form any of the pre-selected questions submitted by investors. Before publishing this content, Lending Club would review the description to ensure the content would not expose a borrower’s identity, potentially speak with the borrower to update the content, and then publish the information. This process could take anywhere from 24 hours to several days.
We know that in the past some investors enjoyed reading these descriptions and answers, but as the platform has grown, fewer and fewer investors are using this approach to inform their decisions. Fewer than 3% of investors currently ask questions and only 13% of posted loans have answers provided by borrowers. Furthermore, loans are currently funding in as little as a few hours – well before borrower answers and descriptions can be reviewed and posted.
We believe that reducing the opportunity to inadvertently expose personally identifying information is the right thing to do to protect the privacy of Lending Club borrowers.
As always, your comments are welcome as we continue to make improvements to our platform.