Renaud Laplanche, founder and CEO of Lending Club in California recently spoke with Jackie Hyland from ABC News Money Matters about Lending Club, where borrowers with good credit can obtain personal loans from complete strangers. It was touted as providing a unique and creative way to get a loan that will offer lower interest rates than most credit card companies and banks can. (Note: Prosper is in a quiet period and has more or less shut down lender operations. Loanio (Loanio Blog) has just launched but lack the secondary market of Lending Club.

Here is my synopsis of the interview…

Lending club operates in the same way as a normal marketplace, however instead of having buyers and sellers, the website caters to borrowers and lenders. “Borrowers are there to get a loan, and lenders are there to make investments in these loans requested by the borrowers and fair interest rates as a result, and at the same time feel good about it because they’re helping other people.” Renaud Laplanche told Money Matters.

Peer to Peer lending or P2P lending allows borrowers and lenders to cut the middle man out, exchanging loans for an average interest rate of 10% to 12% instead of whatever high interest rates lending institutions are currently offering. With the recent credit crunch, not only is the demand for peer to peer lending alternatives going up, but Lending Club has also experienced a dramatic increase in the supply of lending options as lenders look for new ways to invest as returns on the stock market slow.

Since May of 2007 when Lending Club was founded, more than $20,000,000 dollars in loans have been offered through the website on a peer to peer basis. A new SEC-backed program was introduced to Lending Club only ten days ago, and has already facilitating the lending of more than $1 million dollars from lenders to borrowers on the website.

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• Big Lending Club News — Quiet Period Underway for Secondary Market UPDATE:  After a second reading I think my assumption about the secondary market is incorrect…  (My own hopes for such a market might have clouded my...
• Lending Club on ABC News Lending Club was featured on the ABC Nightly News…  P2P Lending is certainly starting to raise it’s profile… Social Lending Networks, New Alternative to Banks...
• The Lending Club Offers New Alternative for Consumer Credit Following $600 Million SEC Registration Back in April of this year, the Lending Club announced that it would be going into a quiet period due to the beginning of a...
• Lending Club Files S1 with SEC Lending Club has filed an S1 with the SEC (link to S1 filing). It looks to be similar in nature to the Prosper filed an...

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Lending Club

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1 million dollars, abc news, buyers and sellers, ceo, credit crunch, dramatic increase, high interest rates, interest rate, investments, jackie hyland, lenders, lending institutions, middle man, money matters, new ways, peer to peer lending, personal loans, quiet period, stock market, where borrowers