Fynanz, the social lending web site aimed at college students, is leaving the P2P loan frat house for the theoretically safer role of service provider, a move that may portend a larger trend of P2P lending sites looking for a side door. “Lending has been substantially reduced, and P2P is no exception. We’ll see more of these kinds of lenders moving to fee-based services,” says Angela Baljeu, a senior manager in the emerging markets and decision analytics division of Experian in Costa Mesa, Ca, who says there are risks inherent is student loans that makes for a tough time in a rough economy.“We are thinking about the younger generation, which is more likely to pay for a cell phone or a car loan before a student loan.”

Only about a year old, Fynanz targeted college students looking for loans in a tight credit market. But since the market’s now arguably even tighter, the company’s stopped taking new members, though it’s still servicing existing loans. Fynanz, which wouldn’t answer requests for an interview, also plans to offer its Web based lending platform to banks and credit unions looking to establish their own student loan operations. “They want to go to financial institutions because of the unknown nature of P2P lending,” says Rodney Nelsestuen, an analyst for TowerGroup, Needham, Ma. “So is this a business opportunity, or a move they’re making because they can’t make a living in peer to peer lending? In some ways, this is a flight to safety.”

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