The relatively young marketplace lending market has yet to withstand a severe economic crisis. We estimated performance of P2P loans in times of economic downturn (2008 crisis) using bank credit card debt statistics.
Several developments negatively influenced performance of Lending Club shares, casting doubts on future prospects of the company and marketplace lending industry as a whole. Mike Lobanov, partner at Target AM, believes that this temporary decline presents a great opportunity to invest and enter the market. Most fears about the company and the P2P lending sector are either short-term or farfetched, while the long-term outlook for the industry remains strongly positive.
Marketplace lending platforms could substitute banks and offline providers for most straightforward and standardized financial products – and mortgage lending is one of the most prominent among them. The key remaining issue here is the U.S. regulation of marketplace lending, which is currently being developed by the regulators.