Social Lending – peer to peer banking in Australia

Well, this sucks. From AsiaMedia.

AUSTRALIA: Web 2.0? Don’t bank on it just yet

Australian banks won’t provide latest online financial services, such as wikis or peer-to-peer lending, due to lack of infrastructure and low retention rates of skilled IT staff

AUSTRALIAN bank infrastructure is “not robust enough” to deliver secure web 2.0 banking and financial services.

That’s the warning last week’s Future of Banking and Financial Services event in Sydney heard but demand and overseas influence will change how banking is done, delegates were told.

Bank of Queensland chief information officer Iain Blacklaw said such plans captured the imagination but for his bank web 2.0 is “at the furthest edges of the radar screen”.

I asked the CIO of Westpac (David Backley) at a TiE event a couple of months ago about social network loans, and he hadn’t heard of peer to peer banking, social lending, Zopa or Prosper. That sucked too.

Clearly M’sieur Backley hadn’t read my blog. Fer Shame! A year and half ago, I posted about peer to peer loans and then followed it up with another piece on Bank 2.0 called Citizen Bankers and Peace Prizes – mostly Prosper and Zopa(UK, soon to be US). I’m interested to see how Zopa goes against Prosper. Zopa seems to have a much better community element. Anyway, this is what I said at the time:

You’re not silly – you are seeing where this is going.
1. It’s not just media that are facing the Web 2.0 squeeze, other industries will be affected almightily as well. Including “secure” institutions such as banks. Don’t believe me? Ask Dymocks or Borders if they felt threatened by Web 1.0 until Amazon opened their non-storefront doors.
2. It’s not just Bangladeshis benefitting from a grassroots collective banking. It’s also people in Orlando, Florida (according to the article) and London, Uk ( And, remember when I quoted Schwartz from Sun Microsystems off hand comment about eBay maybe becoming a bank?
Hmmm. Let’s see: Nobel Prizes, grassroots movement, Prosper, Zopa, Web 2.0 – methinks a large company will jump on this. Betcha 1,000 bucks. Borrowed of course!

…it only took them a year. And it wasn’t a large company. My life is full of strange coincidences. At the TiE event last week, the following the one I attended to listen to David Backley (CIO Westpac)…and also right after the Future of Banking and Financial Services conference… I bumped into into Phil Hopper from – the AUSTRALIAN PEER TO PEER LENDING BANK. Which just goes to show you that no-one has a crystal ball. Well ‘cept me. Here’s a press release for you and an explanation from the Aussie iGrin site.

What is person to person lending?

This is when people borrow and lend from each other โ€“ without having a bank in the way. This has been going on for centuries but with the use of the internet it has made it easier for parties to come together. Person to person lending has been a growing phenomenon overseas with the success of such sites as Prosper in the USA and Zopa in the UK. It also goes by other names such as Social Lending, P2P lending and Peer to Peer lending โ€“ whatever its name it is a great way to get a fair return on your money!

Anyway, back to David Backley. We are both presenting at the Online Social Networking conference in December. I shall endeavour to sign him up to this blog. Heh.

Let me reiterate my point from last year: social networks are NOT just social media. They will change the very foundation of business life. But it’s not the technology, it’s the personal connection. The best peer to peer banks will allow lead influencers to sign up a friend of a friend (FOAF) to help out with loans (private) and donations (not for profit).

My presentation at Making Links this week.

The social “grid” will create new production paradigms around telecommunications, energy and electricity, banking, and feeding the homeless. And screw your business models!

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