asian new zealand IT


Prosper.com, better than Lotto and the banks

, posted: 12-Feb-2007 08:00

It was in the news last night, Prosper.com, the Ebay of loan, where people microlend and borrow of each other. Ebay is for buyers and sellers, while Prosper.com is for borrowers and lenders.

I think this is how it works for the lenders: for example if I have $1000 that I want to loan to people through Prosper.com, I could loan the money to five people, $200 each, and earn different amount of interest rates depending on each borrower's credit rating. For a borrower, Prosper.com says they will do some checking to filter possible fraud.

Apparently, some say the idea isn't new, nothing is new under the sun? I still think it's very exciting. I can't wait for something like this in New Zealand. At the moment Prosper.com is only for U.S. residents with U.S. bank accounts.

New Zealand bank interest rates are rather sad (7.5% is the highest at the moment). The highest interest rate I've seen of Prosper.com is 28%! Ok, so you get that sort of returns from people with rather risky credit ratings (like D or DD), but it's still better than buying Lotto I'd say. And I think their fees aren't that greedy either (lenders pay 0.5% yearly, borrowers pay 1% one off of amount borrowed).

I don't know how this kind of service will work in New Zealand since we don't have 'social security number' (perhaps I'm wrong here?). So will we have a trademe of New Zealand lending and borrowing anytime soon? Only time will tell.

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Comment by juha, on 12-Feb-2007 12:09

"Social Security Number" or SSN is for American citizens only...


Author's note by asianbro, on 12-Feb-2007 12:24

Yeah I know, I meant anything similar to SSN in NZ. Some sort of identification for everyone. I think in NZ, driver license is the only thing close to it.


Comment by Louis, on 18-May-2008 13:14

You are exactly correct about prosper. That is exactly what I did. I invested 1000 dollars in 11 different loans from 50 to 150 each. I am earning between 11% and 22% on those loans (average 14.53%). I only invest in people with AA and A ratings and so far they have all paid on time. In one month I get about 13 dollars in interest. Banks in the US are paying like 2.5 %, so it is a good investment. My username on Prosper is 'betterbank' feel free to contact me for more details. www.prosper.com/join/lend/betterbank Good post - I thought I would help confirm your findings. :) Louis


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