Prosper Marketplace, the peer-to-peer lending company that has originated more loans than any other company in its industry, recently has come under fire for being an investment that is too high-risk and has now outlined what steps that it has taken to reduce the potential losses that its investors might face.
Lending Socially recently interviewed Prosper Marketplace CEO Chris Larsen on the topic of risks associated with peer-to-peer lending. Larsen said that when the company had launched in 2006 that it did not place any limitations on borrowers, lenders, and interest rate bidding.
“It was available to borrowers across the credit spectrum (including subprime), and lenders were free to bid as low as they wished whether it be for financial or, more commonly in the early days, social reasons,” said Larsen.
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