The consumer online lending market is experiencing difficulty, with increasing delinquency and default. When questions were raised regarding the lack of due diligence in online loans, they were initially dismissed. What could go wrong? Now two years later the answer is clear as defaults are leading to business closures. Business lending for asset-based revolving lines of credit, however, has taken a different path.
Consumer online lending pulling back amid defaults
In October of 2014, Dick Bove saw potential problems with online consumer "peer-to-peer" lending. The Rafferty Capital Markets analyst specifically pointed to questionable investor due diligence and loan packaging / transparency issues, ValueWalk previously reported.
Bove warnings came to pass nearly two years later as delinquencies and defaults have been increasing...
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