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Citibank and the online marketplace lender Lending Club, with the help of Varadero Capital, will provide $150 million in loans geared toward fulfilling Citi's community reinvestment obligations.
April 14 -
Prosper Marketplace, one of the leading U.S. consumer marketplace lenders, announced $165 million in equity funding from large banks and other investors Wednesday.
April 9 -
The Securities and Exchange Commission just gave unregistered banks a way to quickly raise capital at a fortuitous time and marketplace lending platforms a way to reclaim their peer-to-peer roots.
March 26 -
Lendio, an online lending marketplace for small business, raised $20.5 million of equity capital in a recently completed funding round.
March 24
Prosper Marketplace, the second-largest consumer finance marketplace lender by origination volume, and OnDeck Capital, a direct online lender to small businesses, have agreed to partner on customer referrals.
Each company will pay a referral fee to the other for customers received. Neither lending platform directly competes with the other, said OnDeck chairman and chief executive Noah Breslow.
"We felt these efforts were complementary mainly," he told American Banker shortly after arriving at the LendIt conference, ongoing this week in New York. "We have customers who come to us who don't have fully formed businesses yet. They look more like consumers."
Hence the companies reckon a strategic partnership benefits them more, at least in the short-term, than branching out into different types of lending and the different credit scoring required to support it.
"Underwriting consumers and underwriting small businesses are very different," Breslow said. "Customer acquisition is very different as well."
Though he would not elaborate much, Breslow said his company and Prosper anticipate "getting more and more integrated," though no merger's in the works. "OnDeck and Prosper are both very successful, independent companies," he said.
Lending Club, rival to Prosper and the leading consumer finance marketplace loan originator, has already begun to diversify into small-business lending. Small-business customer acquisition and underwriting remain challenges for the company, its founder and chief executive Renaud Laplanche acknowledged Monday.
Still, Laplanche said (without giving specific numbers) that the platform's small-business lending numbers are, "slightly ahead of plan," thanks to partnerships with Google and Alibaba.
Lending Club has gathered more data to make its small-business lending more efficient, he said. "We've learned a lot over the first year."
