Lending Club Re-launches at Finovate
Lending Club received regulatory approval from the SEC, and re-launched the Lending Club site at the Finovate 2008 conference in New York. CEO Renaud Laplanche presented the newly-launched site along with a secondary market hosted by registered broker-dealer FOLIOfn. The core borrowing and lending components of the Lending Club site have remained largely the same, although new income and net worth requirements may prevent less-than-wealthy investors from participating. The same requirements apply for buying and selling notes on the Trading Platform by FOLIOfn.
The trading platform is an entirely new web site where lenders can take notes they have purchased through Lending Club, and offer them for sale to other lenders. Only notes created after Lending Club’s quiet period can be traded, and are sold in a fixed price marketplace. To sell a note, the seller chooses the price for the note based on the principal outstanding and accrued interest. On the buying side, investors can search through the notes being sold, view the details of each note, including credit score history, and buy notes one-by-one or in bulk. When a note is sold on the secondary market, the seller pays a 1% transaction fee to FOLIOfn, and the buyer gets the note in their Lending Club account.
As of now, lending is only available to customers from 16 states, but should eventually be available nationwide as Lending Club gets clearance from more state securities regulators. Notably, Lending Club hasn’t yet secured approval from regulators in California, where they are headquartered.
Watch LendingClub’s presentation at Finovate.
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