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Prosper Reports Record Month in April

Prosper has just finished its best month ever for loan originations – we have reached $20.2M in loans for April, and $500M since inception. April’s performance was achieved with the largest volume and the highest average loan amount in history with 1,969 loans and $10,277 respectively. This amount is a 34% growth over March, 2013 and 74% year over year from April, 2012.

Over the past week, many of you have asked about the changes in loan volume. We have seen two trends; first, there have been fewer B through HR rated loans available. Second, loan origination volume through Prosper’s platform has actually gone up, as you can see above. To explain these seemingly contradictory trends, I’d like to start by saying that I believe the industry has reached an inflection point. Peer-to-peer lending is increasingly accepted as a viable investment class. Both retail and institutional lenders are realizing that peer-to-peer loans represent a very interesting and potentially profitable way to obtain unprecedented access to investing in consumer loans. As a result, the industry (not just Prosper) is experiencing a spike in demand. We are aggressively ramping borrower marketing campaigns to generate more loan inventory to meet that lender demand. We are also looking closely at the borrower user experience and application process over the coming months.

All in all, these short term challenges are a positive development for the industry. As we grow, we will help more consumers get their loans funded and therefore offer our lenders more opportunities to expand their investments in consumer loans.

As I mentioned in my April update, we introduced a whole loans program in a beta period for our institutional investors. This has been going well – over $5.8M in loans originated through the whole loan pool in April. This makes up about 28% of loans originated through the platform in April and the remaining 72% originated through the fractional loan pool. On May 3rd we will officially add the whole loans pool as a permanent part of our service.

Here are some details on how it will work:

Prior to posting times, Monday thru Friday only, a subset of randomly selected loans will funnel into a whole loan pool, while all others will post normally into the standard, fractional loan pool. Those loans in the whole loan pool will remain there exclusively for a brief 45 minute period of time. If the loans are not purchased from the whole loan pool within 45 minutes, they will funnel into the fractional loan pool at regularly scheduled posting times, becoming available for funding on the standard Prosper platform. On Saturdays and Sundays all loans will funnel into the standard loan pool, giving our retail lenders the opportunity to bid on all loans available during that period.

This new process is in line with market conditions and enables us to offer whole loan buyers a solution to meeting their mandate and specifications without disrupting the retail lender experience. Additionally, for loans in the fractional loan pool, lenders will now be limited to 75% funding, ensuring that all retail lenders continue to have equal access to a large number of loan options.

Now back to April. In addition to a record month in terms of loan originations, we also made some great progress. We launched a new logo and identity. We would love to hear what you think. As promised, we increased the loan cap from $25,000 to $35,000. Many of you have noticed that this change also included removing our one year loan option. The reason for removing this is simple; one year loans are not in high demand by our borrowers. We will continue to make changes and enhancements like these to balance the needs of both lenders and borrowers.

We also welcomed back our Washington lenders. We appreciate your patience while we worked with the Securities Division of Washington’s Department of Finance to obtain approval and reopen peer-to-peer lending in Washington.

Finally, we are approaching the deadline to transfer to the new enhanced API service we introduced to our lenders back in March. The feedback on this has been tremendous and we are transitioning everyone over. The last day to transition to our new API for lenders is May 1st. If you’re interested in this, please email us at investorservices@prosper.com. If you’re already using it, great! A new password functionality in the settings section will be available in May. Stay tuned.

More exciting things are still to come over the next couple months.

  • Improved collections: We are still very focused on increasing the success of our collections. We have made several changes over the past couple months to increase call intensity and work closely with delinquent borrowers. We continue to enhance this service and will keep you updated here as changes are made.
  • Document Update Functionality: We have begun development on a tool that will allow our borrowers to upload documents directly to our site. This will help to streamline the borrower experience and allow our verification team to move more quickly on verification initiatives.
  • Ramping Borrower Inventory: Over March and April we focused a lot of resources and attention on the lender side of our platform. This has allowed us to onboard a lot of eager lenders. As stated above, in May, we are ramping up our borrower marketing initiatives to meet these new lender needs and will be funneling more and more loans onto the platform.

We are really proud of the progress we’ve made so far, and have many more exciting updates to come as we work to make Prosper the best peer-to-peer lending platform. I’d like to thank everyone who commented on my March post for their thoughtful questions and considerate debate. I’ll be reading and responding so feel free to ask questions or add comments below.

Thank you,

Aaron Vermut
President

04/30/2013 by in Borrowers, Featured, Lenders, Prosper News

A Note from our President, Aaron Vermut, as Prosper Looks to the Future

It’s been a little over two months since CEO, Steve Vermut and Head of Global Institutional Sales, Ron Suber, joined Prosper’s management team, and this week, I am excited to be joining them full time as President. I wanted to let our community know that we intend to use this blog as a method of communication to continuously inform both our borrowers and lenders of what we are working on here at Prosper, and of what new and exciting things are coming in the near future. It’s important to all of us that our customers understand we are striving to make Prosper a leader in customer service and technology. With valuable feedback from our customers, we are able to deliver products and solutions that will enhance the user experience across the platform.

I want to give everyone an idea of all the exciting things the Prosper team has been working on since bringing on the new management team. In February, we focused on building and launching tools and improvements vital to the platform’s performance. Our new API gives lenders the tools they need to customize their Prosper experience in ways never before possible, and Prosper Funding LLC provides increased security and protection for our lenders. We also extended our customer service hours to provide more one-on-one support for more hours of the day.

As we come to the end of March, we’re excited to report $15.1 million in loan originations, a 60% growth over February and our best month since October. We also project $25 million in new loan listings on the platform this month. In fact, at the time of this post, there are 200 new loans now available to lenders.

We have also been looking at various ways to improve our service and product offerings for our retail and institutional lenders, as well as for our borrowers. Here are some of the priority items that we’re focusing on over the next few months (in no particular order):

•   New Prosper Logo/Identity: Along with the technology enhancements to our product, on April 2nd we are launching a rebranded web experience including a new logo and identity. We have been working on this for a while and are excited about the changes. Let us know what you think.

•   Improved collectionsOver the past several months, we have focused on improving collections by increasing call intensity, and working with our delinquent borrowers to be the payment of choice during tax refund season. As a result of these changes, we have had 3 consecutive record months of collections. Moving forward, we will be adding a new collections agency and will send delinquent accounts to collections at 16 days past due rather than 31 days past due. This will enable us to expand our call coverage and skip tracing capabilities, which will provide better results for our lenders.

•   Washington State (and more)We are currently engaged in communication with the Security Division of Washington’s Department of Finance and hope to reopen the platform to Washington lenders very soon. We apologize for the inconvenience to our Washington customers – the blackout is a result of the implementation of Prosper Funding LLC’s New Note Offering. With this implementation, we have also added West Virginia and Michigan, and plan to have several additional states join the platform in the near future.

•   Whole LoansIn April we are launching a whole loan product in beta for our institutional lenders, which will be separate from our traditional pool of fractional loans. The beta version of this product is in test mode and we will communicate more details as they develop.

•   Additional ImprovementsSome of the many other things we are working on are a new IRA trading option on Foliofn, an increase in the loan cap on the platform to $35,000, enhancements to our Automated Quick Invest tool (AQI), and expansion to both our customer support and technology teams.

Steve, Ron and I are committed to creating a transparent relationship with our borrower and lender communities. This asset class and market place are changing rapidly. We will continue to make ourselves available to answer any questions. Please check back here regularly as I publish new posts with updates as well as gather questions and feedback from our community at large. We welcome any comments and/or questions below.

Thank you,

Aaron Vermut
President

03/30/2013 by in Borrowers, Featured, Lenders, Prosper News

Transitioning to the New Prosper API

At the beginning of March, we announced the launch of our new, enhanced API service for lenders. The new API gives our lenders the tools they need to customize their Prosper experience, as well as build more robust tools in less time. Among other features, the new lender API service encompasses a RESTful interface which supports OData query operations, making it easier and more convenient for our lenders to code against. With the new API, we also offer more than 550 data points to each credit profile as well as individual Note details including specifics about payments and reasons for default.

As a result of launching this new API, effective May 1st, the existing API service will no longer be available. Over the next month, all lenders have the opportunity to convert and map their applications to the new API service, which offers a much more comprehensive set of data points, including access to raw listing data and enhanced data sets for analysis and reporting.

To obtain access to the new API for your lender account, please email us at investorservices@prosper.com. We always welcome your comments and feedback below as well.

03/26/2013 by in Featured, Lenders, Prosper News

Prosper Unveils New Protection for Lenders

Over the past several months, Prosper has been working with the SEC on implementing an important new protection to offer enhanced safety and soundness for all lenders on the Prosper platform.  We’re very happy to share that we are the first peer-to-peer lending platform to provide all of our lenders further security of assets. This industry-leading protection, along with our recent fundraising efforts and additions to the management team, represent important milestones for our customers.

First, some details on how this works. A new legal entity called Prosper Funding LLC has been established, which is a wholly owned subsidiary of Prosper Marketplace, Inc. Prosper Funding LLC is now the owner of all loans and the issuer of all Notes on the Prosper Marketplace. As a result, all Notes (both new and previously issued) are now fully protected in the unlikely event of a Prosper bankruptcy.

In order to purchase Notes from Prosper Funding LLC, lenders simply need to agree to the new registration agreement. If you have not done so already, you will be alerted to accept this agreement next time you sign into your account. New lenders are automatically registered with Prosper Funding LLC. In addition, you can review a “Risk Factors” section in the Prospectus for information regarding the risks and benefits of this new offering.

Thank you for your continued participation on the platform. This new protection demonstrates our ongoing commitment to bringing best-in-class tools and services to our lenders.

02/14/2013 by in Featured, Lenders, Prosper News

New Data Enhancements for Investors

We are excited to announce three new enhancements that we believe provide our investors with more decision-making data than any other peer-to-peer lending platform.

Expanding Investor Data Access

First, we now support a CSV download format for a view of our loan performance data. For each loan, you will find a selection of credit attributes from the loan application as well as variables related to the performance of that loan, like final loan status and total principal and interest paid. By combining these sets of data, we have made it possible for investors to more easily construct and test their own investment strategies. This simplified data format will replace the more cumbersome XML format that we’ve used to date. Note that this means that certain types of data, including information related to group membership, member profiles, and bids, will no longer be available in the data export.

You can find the Loan Data Export file on our new Download page. (You can also access this page via the “Download Data” link on our Performance page while logged into your account.) This file will dynamically update on a daily basis.

Expanded Underwriting Information Preview

We are also working to make new sources of data available to guide your decision-making where we can. In 2011 we initiated a project to expand the amount of information considered when determining our Prosper Score. This expanded information will allow us to make better underwriting decisions across the platform, and we are also making it available to you today.

The first component of this data is the Expanded Underwriting Archive, also available on our Download page. The Archive file has a large number of application attributes and performance variables, allowing you to test and develop a wide variety of investment strategies.

Most of these variables are not yet available to investors through our API, however. To enable you to execute your new strategies based on the expanded dataset in the short term, we are also making available a Recent Listings Sample with Expanded Underwriting Data. This file includes a sub-set of recent listings for which we have these expanded bureau attributes.

Finally, we are releasing an Underwriting Archive Data Dictionary for use with the Archive and Listings Samples. There is a lot of data included in those files, but the Data Dictionary should make it easy to understand what you’re working with.

We are truly excited about these developments and believe that they provide our investors with far more information than any other investment platform. Thank you for continuing to invest with Prosper, and please contact us directly at investorteam@prosper.com or leave a comment below if you have any questions about the new data enhancements.

12/03/2012 by in Featured, Lenders, Prosper News

 

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Notice: Blogs and other materials posted on or linked from this page that use the name "Prosper" generally use that name to refer to Prosper Marketplace, Inc. if published before January 31, 2013 and to refer to Prosper Funding LLC if published on or after February 1, 2013.