by Colin Henderson, Chief Technology Officer, CommunityLend
The original vision for peer-to-peer lending was formed at a time when internet models were evolving from web sites to social interactions. The notion of wisdom of crowds and the ability of a larger group to prepare better decisions than discrete individuals was prevalent. Prosper to their credit took that vision literally and applied it to peer-to-peer lending.
Zopa and later Lending Club took a more traditional personal lending approach when implementing their model. The spectrum of peer-to-peer lending has evolved from those early days over a five year period, to one with clearly defined risk management principles in place, and generally one, based on solid borrowers with good credit.