Peer-to-Peer lending (“P2P”) connects borrowers with non-bank lenders at rates lower than typical bank or credit card rates. In May 2013 Google invested $125 million in Lending Club, a sign that the P2P market is gaining traction. Banks may become challenged by these P2P networks. It should be noted that Lending Club’s board includes Mary Meeker formerly of Morgan Stanley, John Mack former CEO of Morgan Stanley and Larry Summers former Treasury Secretary which makes you wonder how long before these platforms begin to look like traditional banks.
We expect the “P2P” market to evolve and expand more substantially to commercial lending.
See a Forbes article here: Article Link