On Tuesday Prosper.com, a person-to-person lending site that launched in February, will announce a couple of fairly significant milestones: 100,000 members and $20 million in funded loans.
They reached both milestones faster than UK-based competitor Zopa, which was recently named a Busines 2.0 “Disruptor.”
Prosper allows members to request loans of up to $25,000 (the average funded loan is $5,000), and then other members offer to fund the loan at various interest rates. Prosper breaks the loan up into multiple pieces to distribute risk, and then funds from the lenders offering the most attractive interest rates. Over 4,000 loans have been funded since the site launched in February 2006. Prosper earns revenue by taking 1% of the loan amount in fees from the borrower up front, and charging a 0.5% yearly loan maintenance fee to lenders.
Interesting fact: Benchmark invested in both Zopa and Prosper, and the two will soon be competeting directly as Zopa expands to the U.S. market.
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