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Just this weekend I finally checked out for myself this whole people-to-people lending thing you may have heard about. In a nutshell, a company named Prosper has basically created a marketplace which brings together people who want to borrow money with people who want to lend money. Typically, that function would be filled by a bank, which would layer on all kinds of overhead, thereby increasing the rates charged to the borrower and reducing the rates paid to the lender. Prosper cuts out that middleman and just fills the role of exchange.

From a marketing perspective, this is just a brilliant idea. It creates an eBay for money. One of the charms of eBay is the personal aspect of it– instead of dealing with a faceless mall, you actually deal with real people. Same on Prosper– you can communicate with the people who want to borrow or lend the money. This is giving lenders a greater sense of playing a role in the borrower’s life. Kind of like ‘It’s A Wonderful Life’-era America banking. Check out Prosper for yourself.

 I’m sure I’ll have more to say on it in the future. For example, if you want to borrow money, what are the best ways to market yourself to a community of lenders?…