Zopa.com is a social lending service and kiva.org is a micro-loan service. At last weekend many British newspapers wrote about Zopa. Now when all banks have a lot of bad loans, Zopa has done very well. And it seems to be a surprise for many traditional finance sector people that Zopa has very few bad loans. Independent writes “Andrew Hagger, from the financial advice website Moneynet.co.uk, admits that when Zopa was launched, he had misgivings. These, he says, have eased over time. ‘I was worried about the possibility of savers losing out due to borrowers defaulting, but after three years there is no sign of this. The key is that, through precise credit scoring, Zopa does tend to be careful over who gets the loans.’”
Independent summarizes “On the other side of the coin, borrowers have seen credit-card, loan and overdraft rates rise as banks grow ever more reluctant to lend. Even people with a good credit history are being charged more or refused a loan altogether. Against this backdrop, any initiative that offers to cut out the banks is bound to appeal. This is where Zopa.com, the money-exchange website, fits in. It styles itself as a market offering ‘loans from people, not banks’. Basically, it matches individuals with cash to lend to individuals looking to borrow.”
Zopa.com and kiva.org are good examples, how new kind of finance and funding concepts can work in the Internet. They are social, they are open and transparent, and they are for longtail. There are still a lot of people who are skeptical, whether this kind of models can really change finance models and business. But we start to have enough evidences that at least these new models have demand and space to grow. And the current crisis of financial institutions will accelerate the growth of new models.
