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Follow on Google News | Recently released market study: UK Personal Lending 2010: Peer to Peer LendingNew Financial Services research report from Datamonitor is now available from Fast Market Research
Scope * Analyses and forecasts the shape and size of the peer to peer lending market * Identifies main competitors and their business strategies * Considers future avenues of market development Report Highlights Peer-to-peer lending has seen its market share of gross advances increase as a result of the credit crisis. However, it remains a small part of the unsecured personal lending market in the UK. Zopa was the UK's only player in the peer-to-peer lending market from 2005 to 2009, however recently there have been two new entrants into the market; Yes-Secure and Funding Circle. This has created more competition in the market and highlighted the low barriers to entry. Reasons to Purchase * Gain a comprehensive understanding of the Peer-to-Peer lending market * Make informed market decisions by understanding the future size and potential threat of peer-to-peer lending on the retail banking sector * Enhance credibility during sales pitches by understanding the future direction of the peer-to-peer lending market For more information or to purchase this report, go to: - http://www.fastmr.com/ Partial Table of Contents: DATAMONITOR VIEW 1 Catalyst 1 Summary 1 ANALYSIS 2 P2P lending is increasing its market share of gross advances as a result of the credit crisis 2 P2P lending companies are platforms that facilitate transactions between lenders and borrowers 2 Lenders invest their money into the P2P lending platform, seeking greater returns than those available on alternative financial products 2 Only consumers that have a good credit rating can become borrowers on P2P lending platforms 3 The market is subject to high level of adverse selection 4 P2P lending requires risk management to reduce the chances of lenders losing their investments 4 Default risk is usually shouldered by banks in the traditional lending and borrowing system 5 The P2P lending company is responsible for identity checks 5 Borrowers and investors are protected against the risk of the P2P lending company going bankrupt 5 P2P lending companies are not authorized and regulated by the FSA 5 P2P lending companies have to register with the Office of Fair Trading 6 P2P has lower overheads, but banks do not charge upfront arrangement fees 6 The P2P lending market has experienced exponential growth from 2007 6 The P2P lending market grew at a CAGR of 80.9% from 2005 to 2009 6 P2P lending made up a negligible percentage of the UK unsecured personal lending market over the past five years 8 P2P lending companies will not increase their market share of gross advances significantly in the near future 9 As the economy recovers, banks will increase their gross lending 10 New high street banks will increase competition for deposits and advances 10 Increased liquidity in the P2P markets will attract more investors 10 Zopa is the main UK player, although others are entering the market 10 Zopa is the main player in the UK market 10 The average Zopa lender is more mature than the average borrower 11 Zopa offers competitive market rates 12 Zopa's growing reputation has encouraged other players into the market 13 YES-secure start trading in June 2010 13 Funding Circle focuses on small business lending 13 Minor barriers to entry make it easy for competitors to enter the market 14 Competitors in the US could branch into the UK market 14 Aggregator websites and promotional offers attract new business to P2P lending websites 14 Existing players have performance data 14 Consumers are unaware of how the different types of risk will impact on the rate of return of their investment 15 Investors fail to realize the additional risks they face by investing in P2P lending 15 Investors cannot access their funds until the end of the contract 15 Reinvestment risk could see investors' risk/return ratios change over time 15 Naive investors who invest across different risk classes will not know the probability of expected returns deviating from actual returns 16 Listings allow borrowers to get competitive loan rates as supply outstrips demand 16 Consumers are more resistant to taking on debt than before the financial crisis 18 Movement between different markets requires borrowers to increase their record of successful borrowing 18 Product innovation and secondary markets could be the future for the P2P lending market 18 Secured personal lending could be the next step in P2P lending 18 Expansion into the mortgage market is likely to be too complex for P2P lending companies 19 The development of a secondary market would add sophistication to the field 19 The secondary market allows for notes to be bought and sold 19 The secondary market attracts a more sophisticated investor 19 The UK market could follow in the US' footsteps 20 A secondary market would increase liquidity and attract new members 20 P2P lending companies can attract the attention of a variety of different clients to increase growth 20 APPENDIX 22 Data 22 Definitions 23 Borrowers 23 Lenders 23 Listings 23 Further reading 23 Ask the analyst 23 Datamonitor consulting 23 Disclaimer 23 List of Tables Table 1: Zopa's average clientele 2010 12 Table 2: Average statistics on amounts borrowed using Zopa over the 30-day period starting July 10, 2010 12 Full Table of Contents is available at: -- http://www.fastmr.com/ About Datamonitor The Datamonitor Group is a world-leading provider of premium global business information, delivering independent data, analysis and opinion across the Automotive, Consumer Markets, Energy & Utilities, Financial Services, Logistics & Express, Pharmaceutical & Healthcare, Retail, Technology and Telecoms industries. Datamonitor's market intelligence products and services ensure that you will achieve your desired commercial goals by giving you the insight you need to best respond to your competitive environment. View more research from Datamonitor at http://www.fastmr.com/ About Fast Market Research Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available. For more information about these or related research reports, please visit our website at http://www.fastmr.com or call us at 1.800.844.8156. # # # Fast Market Research is an online aggregator and distributor of market research and business information. We represent the world's top research publishers and analysts and provide quick and easy access to the best competitive intelligence available. End
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