prosper is dead
I have to say that the whole peer-to-peer lending world is looking shaky these days. As pointed out by my fellow Money Writer, Lazy Man, Prosper abruptly moved into their quiet period. Prosper sent an email today saying that their quiet period was beginning, just after Lending Club finished their 6-month quiet period. I imagine Prosper’s quiet period will be shorter, but still several months. I’m not sure how everyone else reacts to this news, but I don’t view it as a net negative or positive for p2p lending. I think it has a future, but I think we need to wait until Prosper is out of the quiet period to see where it’s going to go. Zopa pulled out of the US, eliminating another p2p lender.
On the other hand…with the market as crazy as it is, I don’t think p2p lending is a bad investment at all. These SEC requirements regarding quiet periods are strange, I’ll grant, but I’m going to keep my small investment in both Lending Club and Prosper going. It’s a non-market investment and I’m comfortable risking a small amount of money to see where it goes – so far I’ve been collecting my money and I’m happy with the returns. The way I see it, any “alternative” investment is worth it at this point!
photo credit: Chris Fleming
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I'm not so certain Prosper is dead. I think they will come back strong if/when their secondary market is approved. The P2P market is changing though, and I think it has a decent future. With many credit streams drying up, people will look to alternative methods of getting loans. And don't forget about Loanio which was late to the party, but still has time to make an impact in this fledgling industry. I think it will be an interesting few months for the industry.
Thanks for the link, but did you have to steal my title
I did – that's why I put the link to your article in, to make sure you'd notice
I feel very optimistic about it, honestly. It's important to note that, since the “quiet period” is to allow the SEC to approve *selling* of loans, that it's actually a sign of these sites' success, not failure. If they can afford to suspend new accounts for 6 months…wow. And afterwards, they stand to make only more money as a wave of small loans are sold on the market.
Like I mentioned on Lazy's site, Prosper isn't dead. They will come back from this stronger and better than ever. This is a good thing – not bad.
Like I mentioned on Lazy's site, Prosper isn't dead. They will come back from this stronger and better than ever. This is a good thing – not bad.