Milestone: Lending Club Facilitates $1 Billion/2nd Qtr.

By Charles H. Green

In 2013, CAN Capital funded nearly $1 billion through their merchant cash advances, a crowning feat after spending 10 years to distribute $1 billion, 3 years to distribute the second $ billion, and 2 years to fund their third $ billion. But that rate of growth has now been eclipsed.

Lending Club, announced this week that it has facilitated over $5 billion dollars in consumer Lending Cluband business loans since inception, $1 billion of which was facilitated just in the last quarter ending June 30, 2014.

“This milestone brings us another step closer to our goal of transforming the banking system, one billion at a time,” said Lending Club founder and CEO Renaud Laplanche. “We believe we can make the system more cost-efficient, more transparent and more customer friendly, and are committed to offering cost efficient products that help people achieve their financial goals.”

Lending Club is a peer-to-peer lending platform that facilitates people seeking credit to get their request in front of other persons seeking to invest in these kinds of consumer and business loans. Lending Club evaluates each application and grades it, which provides the investor with an indication of risk and determines the ultimate loan pricing.

Commercial lenders might think they must deal with too much paperwork, but non-bank loans are actually recognized as a security in the eyes of the Securities & Exchange Commission (SEC). That means that a registration filing must be submitted by Lending Club to them for each and every loan. Their average loan size is just shy of $14,000, meaning that in the second quarter alone, they filed over 71,400 security registration notices with the SEC.

The average investor participation of each investor on these loans was not readily found on their website, but Lending Club’s online investment discussions encourages investors to diversity their portfolios. As an example, this information cited the example of spreading a $5,000 investment over 200 loans with $25 each.


This entry was posted in ABL, AdviceOnLoan, CRE, SBA
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