The team here at Lending Hub is proud to announce our collaboration with the new online retailer Urbanities.com.au …”the Fun and Quirky Lifestyle and Living Store”. Urbanities is a new concept in online shopping experience for Australians and New Zealanders for homewares, kitchen wares, gadgets, kids stuff, wall art and designer toys.
The ethos on Urbanities is all about hard to find, exclusive, limit range products from boutique designers and artists… something to create that different look at home or the office.
Urbanities supports independent designers and artists both locally in Australia and New Zealand and International designers in Japan, Europe and the United States. The team is always on the lookout for new products that are edgy, cool and interesting and are more exclusive. If you are a designer or product creator then check Designing and Collaborations for Urbanities for more info on how Urbanities can help up and coming designers or create promotions and campaigns for new designs and products.
We have chosen to collaborate with Urbanities after an extensive search of new innovative concepts in the online space that meet the following needs for consumers – innovative, fun and with a high-end demographic profile. The team at Urbanities has extensive retail and digital business experience and is committed to creating a whole new experience in Australia and New Zealand for online shopping.
If you would like to know more then you can visit www.urbanities.com.au and browse the interesting and novel products or just read their fun and exciting blog at www.urbanities.com.au/blog.
Have fun shopping for your home and office on Urbanities!
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In this post we look at a few quick stats that might illustrate how big the peer to peer or social lending market could be in Australia. In the US which can be used as a good example for where Australia might be headed over the next 2-3 years, there are about four social lenders - Virgin Money US, Prosper.com, Lending Club and Loanio (there are others but these are the main ones at this time).
Prosper.com has reported it has generated about $200 million in social loans and has 840,000 members to date.
Virgin Money US (which was the former Circle lending business that Richard Branson invested in) has reported about $450 million is social loans to date.
In the UK it has been estimated that social loans might account for 10% of the total personal lending market by 2010.
Here is Australia we estimate the personal lending market to be about $30 billion and it is quite likely that over the next few years social lenders and P2P platforms will start to take a small share of this total market as has happened in the US and UK.
Of course unlike the US market Australia has fewer lenders in the personal loans market space and so competition is limited which leads to the higher interest rates that we see borrowers paying with less transparency. The social lenders such as Virgin Money US and Prosper.com are offering a consumer service that should help elevate the standards of the industry which, after the global financial crisis is evident is necessary for lending industries in many developed countries.
Our next post will look at the characteristics of some different investment asset classes.
The Lending Hub Team
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Lending Hub Online Loan Platform Goes Live!
We have been developing, coding and creating a peer to peer or social lending platform for personal loans between family and friends and today we finally go live!
Go to lendinghub.com.au to browse the site, or lendinghub.com.au/Info/AboutUs.php to learn a little bit more about Lending Hub in Australia.
Start a Loan Listing
Looking to borrow money from a friend or family member? Start at lendinghub.com.au/Borrowing/HowToBorrow.php to see how to create an online loan listing and start borrowing from your network of friends and family.
Want to Help a Friend with a Small Loan
Looking to help a friend or relative with a small personal loan that could make a real difference to their lives? The go to lendinghub.com.au/Lending/HowToLend.php to become a registered lender on Lending Hub and to bid on your friend’s loan. Remember that the borrower needs to create a loan listing on the Lending Hub loan market so why not send them a quick email first and get them online and listed!
Just Curious About P2P Lending?
P2P Lending is a truly novel and innovative concept that will revolutionise the way we think about money and lending. In the US, UK and Europe P2P lenders are taking off and proving to be extremely popular. This is a world wide phenomenon were consumers want an alternative to the traditional and old fashioned banks…and now its available in Australia.
See our information site for more help - Lending Hub Help Centre.
Alternatively browse the Lending Hub Blog which is full of articles and commentary on the Peer to Peer loan industry.
Who Can Start a P2P Loan?
Anyone with an Australian bank account and who is over 18 years of age.
From the Lending Hub Team…best of luck with your loans and we hope you enjoy an alternative to the banks!
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Today the Commonwealth Bank of Australia (CBA) increased its home loan variable interest rate by 0.1% to 5.74% even though the official cash interest rates have been falling and we are in the middle of an economic downturn and global financial crisis (also popularly known as the GFC).
It’s interesting to note that the ‘big’ banks continue to be true to form and alienate their customers, the borrowers by hiking up interest rates (and fees) when times are tough.
These sort of price hikes come about due to a lack of a real alternative in Australia to the traditional big banks…many of the smaller banks and non-bank lenders have been bought out or have effectively stopped lending.
This is a good example of why we have launched the Lending Hub Marketplace for Loans…we seek to provide ordinary individuals the way to sidestep the big institutions and lend and borrow directly person to person. Borrowers and consumers will hopefully benefit from the introduction of an alternative of to the expensive and old fashioned lenders.
Lending Hub …where ordinary people set the interest rate!
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US Lenders on Prosper can now Trade Loans
Prosper.com the US peer to peer lender has recently announced the launch of a new loan exchange where personal loans can be traded on a secondary market. Interesting concept as the loans are originated by Prosper approved financial institutions and then traded on Prosper where lenders can bid the interest rates on these loans.
This open market is a further example of the effectiveness that digital platforms can have in setting fairer and more transparent prices and allow for more effective distribution of risk amongst a wider set of lenders. We’ll be watching and seeing how this new product and exchange takes off in the US and maybe consider this for Australian borrowers and lenders in due course.
In Australia it is still early days for the P2P loan market which Lending Hub is building and developing but in the US there’s a great deal of innovation being driven by the size of the market and the tightening of credit by the financial institutions following the sub-prime credit crunch.
Further Info on Prosper.com
For further details see Prosper’s info page Prosper Open Market.
Prosper.com reports on its site at http://www.prosper.com/welcome/marketplace.aspx to have originated US$178 million in personal peer to peer loans at about US$6,100 average loan size.
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Circle Lending…Loans in the Family
Australians like many other cultures have often turned to their closest resource when needing to borrow money without the involvement of a bank or institutional lender. A Circle lending community and market though is a fairly new concept in Australia in terms of a structured market for friend to friend and family to family loans. If you are looking to setup a loan in the family here are a few things to consider and organise first.
Formalizing Family Loans
Borrowing or lending to a family member can sometimes be a little difficult to setup as it can be process influenced by the emotions of close family members. After all how easy is it to ask a parent or a sibling for money!
Instead of just asking for a loan from your relatives and having to ask the difficult question, Lending Hubworks by ‘formalising a family loan’ model. As a borrower you create a loan listing on Lending Hub and go through a quick application. At the end of the application you have effectievly created a formal request for a loan with a set repayment schedule, dfined interest rate and amount and you have stated the purpose and use for the personal loan.
Generating Interest in your Loan
The next step is to promote your loan listing to you family members (or close friends if you want to as well) by emailing them details of your loan listing on Lending Hub. Your family members can then view your commitment to the loan by viewing a loan listing similar to the ones at Lending Hub Sample Loan Listings.
Making it Easy for Your Family to Lend to You
Make it easy for your family to make the decision to lend to you by following a few simple points:
- State what you want to use the personal loan for and include some detail e.g. Loan for an Education Course
- Keep the amount you are asking for as small as possible by doing a quick budget of what you actually need
- Provide a little info about yourself…you’ll be surprised how often even people who know you forgot the specifics of your background!
- Set a reasonable limit on the interest rate, even if are prepared to pay a rate similar to a bank it will help show you are serious
- Be active in promoting your loan and need for a loan…persistance pays off
So instead of making vague promises and using the back of a napkin to borrow money from your parents or other family members, take an active step in formalising your loan.
Best of luck.
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There’s been a great deal of pessimism about the GFC (Global Financial Crisis), the economy, job prospects, the share markets in Australia (and the World) lately. Consumers are finding that the banks have started to tighten access to consumer loans and restrict lending all but their prime clients. In a country with four large banks Government decisions have helped these banks to snap up smaller rivals and effectively have lessened competition at a time when consumer need more competition rather than less.
Now, not only does it take longer to get a home loan or personal loan from one of the major banks but the LVRs (loan to value ratios) they offer are lower and potential borrowers with any blemish on their credit history are effectively being locked out of the loan market, even if it something small such as not paying a phone bill.
We at Lending Hub have been developing our person to person lending platform to allow Australian consumers who are either finding it hard to get a loan from the banks or just want a better deal. Lending Hub will let consumers and borrowers tap into the power of their network of friends and family and borrow small personal loans from people thye know.
Similar to other circle lending networks individuals looking to fund personal expenses can apply for a loan listing on Lending Hub and then market their loan to their friends and family.
Friends and family (and even work mates) are more likely to lend to someone they know and trust and the reward is that borrowers are more likely to repay on time.
The GFC may have caused a credit squeeze in the short term in Australia but soon to be going live Lending Hub will offer borrowers another avenue for their loan needs.
See us live in April 2009!
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