Legitimising collaborative lending

Vince Cable launches £110m loan scheme aimed at small firms headline in today’s Guardian It’s fascinating to see Government turning to the web‘s collaborative lenders. When companies like Zopa started I doubt that banks thought of them as serious competition. While the sums offered by government are relatively small, the principle is important. And if the scheme succeeds, by giving lenders a better return than a bank would offer, there’s the potential for a win-win in the private sector, at the expense of conventional banking. As digital businesses, it’s highly likely that when a model works it will also scale, rapidly. And while this initiative is underpinned by government funding, the legitimacy conferred by the scheme will fuel future growth in collaborative funding. Ht the guardian

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