Marketplace Loans: How Might They Perform During A Downturn?

Published on: 3/20/2019. Revised on: 3/26/2019.

In this issue of Marketplace Insights, we focus on how marketplace loans might perform during an economic slowdown or recession.

Given the length of the current economic expansion, last year’s stock market dips, and growing recession concerns, investors have begun positioning for a more challenging investment environment. LendingClub’s experience of growth through the post-financial crisis period—to become the marketplace loan industry’s U.S. leader—supports our belief that marketplace loans’ unique features may make them resilient in a range of economic environments.

Highlights:

  • Marketplace loans may provide resiliency to diversified investment portfolios thanks to a combination of features including, relatively lower sensitivity to changes in interest rates and steady consumer demand for credit through different economic cycles.
  • LendingClub has deep expertise with consumer credit. Our platform is well-positioned to react to changing economic conditions.

In this piece we discuss marketplace loans as an asset class, review their historical performance, and discuss what that might mean for how they could perform during an economic downturn. We also highlight how LendingClub is preparing for a more challenging economic environment.

Read the full Marketplace Insights piece here.

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