Lending Club is the world’s largest online marketplace connecting borrowers
and investors. We believe a technology-powered marketplace is a more efficient
mechanism to allocate capital between borrowers and investors than the traditional
banking system. Our marketplace substantially reduces the need for physical
infrastructure and improves convenience and automation, which increases efficiency,
reduces manual processes, and improves the overall borrower and investor experience.
Qualified consumers and small business owners borrow through Lending Club to
lower the cost of their credit and enjoy a better experience than traditional
bank lending. We believe the range of loan products we facilitate are simple,
fair and responsible credit products that make it easier for consumers to budget
for monthly repayment and meet their financial goals.
Investors use Lending Club to earn attractive risk-adjusted returns from an
asset class that has generally been closed to many investors and only available
on a limited basis to large institutional investors. The capital to invest in
the loans enabled through our marketplace comes directly from a wide range of
investors, including retail investors, high-net-worth individuals and family
offices, banks and finance companies, insurance companies, hedge funds, foundations,
pension plans and university endowments, and through a variety of investment
channels.
We have developed our proprietary technology platform to support our marketplace
and offer a variety of our issuing banks’ loan products to interested
investors. Our proprietary technology automates key aspects of our operations,
including the borrower application process, data gathering, credit decisioning
and scoring, loan funding, investing and servicing, regulatory compliance and
fraud detection. Our platform offers sophisticated analytical tools and data
to enable investors to make informed decisions and assess their portfolios.
Our extensible technology platform has allowed us to expand our offerings from
personal loans to include small business loans, and to expand investor classes
from individuals to institutions and create various investment vehicles.
We generate revenue from transaction fees from our marketplace’s role
in accepting and decisioning applications for our bank partners to enable loan
originations, servicing fees from investors for matching available loan assets
with capital, and management fees from investment funds and other managed accounts.
Our business model is not dependent on using our balance sheet and assuming
credit risk for loans facilitated by our marketplace. In order to support contractual
obligations (Pool B loans), regulatory commitments (direct mail), the testing
of pilot loan programs, or customer accommodations, we may use our capital on
the marketplace from time to time and on terms that are substantially similar
to other investors.
We believe a transparent and open marketplace where borrowers and investors
have access to information, complemented by technology and tools, can make credit
more affordable, redirect existing pools of capital trapped inside the banking
system, and attract new sources of capital to a new asset class. We believe
that online marketplaces have the power to transform the traditional banking
system, facilitate more efficient deployment of capital, and improve the global
economy.
We believe the ability of individuals and small businesses to access affordable
credit is essential to stimulating and sustaining a healthy, diverse and innovative
economy. Lending to consumers provides financial flexibility and gives households
better control over when and how to purchase goods and services. While borrower
appetite for consumer and small business credit has typically remained strong
in most economic environments, general economic factors and conditions, including
the general interest rate environment and unemployment rates, may affect borrower
willingness to seek loans and investor ability or desire to invest in loans.
Access to Affordable Credit. Our innovative marketplace model, online delivery
and process automation enable us to offer borrowers interest rates that are
generally lower on average than the rates charged by traditional banks, credit
cards or installment loans.
Superior Borrower Experience. We offer a fast and easy-to-use online application
process and provide borrowers with access to live support and online tools throughout
the process and over the life of the loan.
Transparency and Fairness. The installment loans offered through our marketplace
feature a fixed rate that is clearly disclosed to the borrower during the application
process, with fixed monthly payments, no hidden fees and the ability to prepay
the balance at any time without penalty. Small business lines of credit have
rates based upon the prime rate and allow borrowers to draw in increments, reducing
their interest cost. Our platform utilizes an automated, rules-based engine
for credit decisioning, which removes the human bias associated with reviewing
applications.
Fast and Efficient Decisioning. We leverage online data and technology to
quickly assess risk, detect fraud, determine a credit rating and assign appropriate
interest rates quickly.
We believe that our marketplace provides the following benefits to investors:
Access to a New Asset Class. All investors can invest in personal loans facilitated
through our standard loan program. Additionally, qualified investors can invest
in loans facilitated through our custom program loan program in private transactions.
These asset classes have historically been funded and held by financial institutions
or large institutional investors on a limited basis.
Attractive Risk-Adjusted Returns. We offer investors attractive risk-adjusted
returns on loans offered through our marketplace.
Transparency. We provide investors with transparency and choice in building
their loan portfolios.
Easy-to-Use Tools. We provide investors with tools to easily build and modify
customized and diversified portfolios by selecting loans tailored to their investment
objectives and to assess the returns on their portfolios. Investors can also
enroll in automated investing, a free service that automatically invests any
available cash in loans according to investor-specified criteria.
171.13 %