Australia Social Finance: List of Peer to Peer loans and p2p banks

After the radio interview with Tony Delroy a few days ago, I’ve had an inordinate number of requests for information on social lending and microfinancing sites. Particularly Australian p2p banks. Remember a bank holds money that the community members have each – for example, salaries, or savings. Then the bank manager takes the community money and decides who to give loans to – back to a community member. Peer to peer loans (many members providing parts of one loan) simply disintermediates the aggregator/bank manager. Bypasses the middle man – the community members decide who they are going to lend the money to, themselves.  Sort of an eBay of loans but only if you consider reputation and trust. Otherwise its lots of people bidding to provide you with money.

I’ve blogged on peer to peer banks since 2006 or so, but here’s the latest list I have:

  • iGrin Opens in a new tab.Australia‘s p2p loans – doesn’t look very social but it is still social finance

    Kiss me Virgin!
    Kiss me Virgin! Cute.
  • Lending HubOpens in a new tab. – Australian
  • Fosik Opens in a new tab.Australian peer to peer lending
  • Peermint Opens in a new tab.launching in Australia
  • Prosper.com – waiting to upgrade to SEC.
  • Zopa.comOpens in a new tab. from UK
  • Peer-lend.comOpens in a new tab.
  • Pertuity Direct, which is launching an SEC-registered mutual fund that invests in person-to-person loans.
  • Lending Club, which recently registered with the SEC to create a secondary market for its loans, has been signing up twice as many lenders each week than it was last spring, and new loan originations are up about 40% over year-ago levels,
  • Loanio Opens in a new tab.– US based

NOT Social finance but still a social network around finance

  • Mozo in Australia Rank and review banks

Hope that helps – I gave a presentation on social lending a few years ago – heartening to see most of the banks moving onto SEC accreditation.

lending-clubPeer to peer lending in 200 million member Facebook (8 million Australians are members). That’s a reasonable size bank right there.

I’m keeping an eye on YadYap Opens in a new tab.– wouldn’t be surprised if they come up with a Twitter p2p loans solution.

FiLife Opens in a new tab.in conjunction with Wall Street Journal have these great tips:

Whether you’re a borrower or a lender, find the best P2P site by following these tips:

If you want to borrow money:

  • Check the longevity. See how long a site has been in business. While a company’s founding date is not a measure of future performance, you’ll at least see which ones have established a track record.
  • Determine the specialty. Before you choose a P2P site, see which ones focus on your needs. For example, it you’re looking to convert your student loans to one with a lower interest rate, two sites now specialize in education debt— Fynanz.com and CollegeDegreeFund.com.
  • Measure client satisfaction. One way to do this is to check independent online chat groups and read the praise and complaints. You can do this by typing the P2P site into Google + “forum.”
  • Know the terms. Read the site’s frequently asked questions (FAQ) to understand the rules, fees and risks—minimize disappointment.
  • Verify the score. Check the P2P’s credit-score cutoff point. Some sites use 640 as a minimum. Only consider sites where your credit score is higher than the one used. Doing so will make you more attractive to lenders. You can use the site if your score is lower, but you will be designated as a “high risk” borrower.

If you want to lend money:

  • Do your due diligence. Check the site’s longevity, client satisfaction and bank the site uses (see above).
  • Understand the risks. Most P2P sites explain the risks you face as a lender and what the site will and won’t due if a borrower is late paying, does not pay or defaults.
  • Consider making several small loans rather than one large one. This strategy will help you diversity your risk and improves the odds of higher returns, since you’ll likely hold many loans with different rates rather than just one.
  • Vet the borrower. Like eBay, many sites let you see buyer information and even contact the borrower to learn more about the individual or loan need. Consider contacting borrowers and asking for more information about their need for the loan and how they plan to repay it. You will, of course, be at the mercy of whatever they tell you, but banks have no guarantee of repayment either. Banks reduce risk by making lots of loans and lending only what they think they can afford to lose if a borrower defaults.

If you don’t want to pay back your loan, consider KickStarter Opens in a new tab.for more creative solutions. I love the first one there – not only is Allison Weiss 256% fundedOpens in a new tab. (yep, that’s OVER funded), she also gives away cool prizes to those who fund her next EP. Such as a song written about them.

Finally, WiseClerk Opens in a new tab.is the blog/forum I have been following for about a year now – always interesting news in both peer to peer banking and peer to peer mobile payment transfers.

Laurel Papworth

Named by Forbes™ Magazine in the Top 50 Social Media Influencers globally, named Head of Industry, Social Media (Marketing Magazine™) and in the Power150 Media bloggers (AdAge™). CERT IV Training and Assessment certified trainer (Diplomas and Certificates etc) Adult Education. Laurel has manager Facebook Pages for Junior Masterchef, Idol, Big Brother etc. and have consulted on private online communities for banks Westpac, not for profits UNHCR & governments in SE Asia. Lecturer, social media, University of Sydney for 10 years and Laurel has 11,000 online students. Laurel Papworth personally connects to 6 million followers online and has taught around 100,000 people in the last 10 years how to be social media managers.

23 thoughts on “Australia Social Finance: List of Peer to Peer loans and p2p banks

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  5. Great list!

    P2P lending still seems to be disappointingly in its infancy in Australia when you compare us to the UK and the US. I dug myself out of a debt hole and am now in a position to be lending, so I’d really like it to get a move on so I can start helping people who are like the former me.

    Perhaps this will be a good thing to come out of the current economic environment?

    sam @ moneypenny’s last blog post..Lifestyle Inflation – Are You A Victim?

      1. Mozo is a financial comparison site.

        It has up to date, objective data about pretty well all Australian financial products plus it has customers’ opionions (captured as ratings and reviews) about their banking experience with their financial provider.

        So you can find your ideal product by comparing your options, you can compare your current product with the market to see just how much value you are (probably not) getting, and you can give vent to your fiscal feelings.

        In other words, you can put your mouth where your money is.



        1. ayep. Nice ad 😛
          But the post was about peer to peer lending, not bank-to-customer lending with reviews.
          Still, if YOU are involved, it will be a good site!

  6. Hi Laurel
    Interesting article – would love a thorough update on Fosik (which has server errors), LendingHub (which seems to be frozen in time) and iGrin (which has written >$200k in loans but now has very little activity. Peermint, it seems, didn’t get going.
    Surely this is as good a time as any to get peer to peer happening?

  7. Interesting article but I think you have forgotten Society One Australia’s only P2P lender

  8. Sweet blog! I found it whil browsing on Yaho News. Do
    you have any suggestions on how to get listed in Yahoo News?
    I’ve beeen trying for a while but I never seem to get there!

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