Why online lending is still stuck in analog

  • E-commerce focuses on price, as there is no other angle -- no local reputation (or vulnerability after bad service), no tires to kick.
  • Online has been just another means of access, the lending part unchanged, until some entrepreneurs tried to apply crowdfunding principles.
  • Technologists, bless their brave hearts, have been in a constant and massive effort to reinvent all of commerce, to see if online works better than the old way. Frequently, we’re left with businesses just as they were.

Oh, the pleasure taken by an old guy at a new tekkie pratfall! Schadenfreude, the Germans call it. Too bad about Lending Club. Shed a crocodile tear. The first online lending appeared about 25 years ago, about the time we got our first email addresses. Then or since, anybody can make a loan online, in the sense of gathering information, approving and closing.