According to Liberum, P2P lending in the UK will grow at 98% year-on-year in 2015, with £3.5bn presently lent out. Worldwide in 2015, it’s estimated that $77bn will be lent via P2P platforms – $60bn China, $12bn USA and $5bn UK. Morgan Stanley’s Huw Steenis says: “While marketplace lending is still [about] 1% of unsecured consumer and SME lending in the US, we think it can reach [approximately] 10% by 2020…. We forecast the global market to grow to $150-$490bn by 2020.” As Liberum’s Cormac Leech says: “We are witnessing the biggest changes to the banking sector for 400 years.”
P2P lending offers huge opportunities, mainly at the expense of banks, whose biggest margins are traditionally in unsecured lending. Herein is the layer of fat P2P platforms are guzzling, picking off the banks’ best customers. P2P platforms have also proved superior at harvesting and managing big data, and have lower cost bases than banks.