...Emerging Sector Challenges Banking: In just a few short years, marketplace lending has grown from a niche market to a more mainstream source of borrowing for consumers and small businesses in the U.S. Marketplace lending typically bypasses traditional banks by connecting consumers and small businesses directly with lenders, or investors. Significant cost savings can be achieved and passed through to borrowers via lower interest rates, as these platforms benefit from more efficient online operations and fewer regulatory burdens. Operational Advantages: Marketplace lending typically utilizes centralized platforms to conduct loan origination and servicing. Products are generally straightforward, fully amortizing installment loans with very limited renewals or modifications allowed. Automated Clearing House (ACH) payments are dominant in this space, which makes loan servicing relatively simple and any potential servicing transfers less cumbersome. Limited History and Other Challenges: Marketplace...
