Consumer borrowing power isn’t what it once was. With tough economic times and a challenging job outlook, credit from traditional lenders — such as conventional banks — is scarce. Due to the Great Recession and the slow recovery, alternative forms of financing are becoming more popular. One of the fastest growing loan types is peer-to-peer (or P2P) lending.
So what are peer-to-peer loans and how does the lending process work? In short, the peer-to-peer lending platform acts like a match-making service that connects lenders with consumers in need of a loan. Prosper®, a leading peer-to-peer market place, has created an infographic to help explain how peer-to-peer lending works.