Reuters - Video

Edition: U.S. | U.K. | IN | CN

Investing 201

How to play banker on the web

Tuesday, June 11, 2013 - 02:57

Peer-to-peer lending sites offer anyone the chance to lend money online to registered borrowers. People can lend as much or as little to as many people as they like. The interest rates can generate sizeable returns.

▲ Hide Transcript

View Transcript

You can do just about anything on the Internet -- your hands should be passed right here sheet and find out how much time you have left on -- I can even play banker. Making money by lending the strangers it's a novel way of getting high yield it's called peer to peer lending. Peta. Borrowers get much better interest rates that banks and credit card firms offer investors to get better returns and the interest that banks offer. Sure invest in loans as riskier than socking money away in savings but returns averaged roughly six to 10%. Vs past the interest of half a percent invest in the riskiest loans and net returns can be as high as 14%. After accounting for -- -- and a 1% -- here's how it works investors can choose from two sites and dominate the US to keep market. Lending club or prosper. They -- picked ala cart off a list of personal loans or have the site generate a loan portfolio in minutes based on how much risk the investors willing to take that to me. It's easy to diversify its value of offer investors -- in between that's -- -- 25 bottles. If you come in where it. Eight were 101000 bottles we recommend that investors. -- Q 25 total keys in the form dread. -- Typical entry will tell you how much money powers asking for what you'll use it for why he feels he deserves alone in -- stand -- These are prime loans typically ten to 151000 dollars lending club rejects 90% of all applicants prosper 80%. As bars make their payments investors get their pro rated share in cash each month. Keep in mind these loans are not guaranteed. So investors faced the risk that a borrowed one not paid back. Lending club says less than 3% of loans default prospered -- -- at less than 8%. The nice thing about the default risk here is that you're getting at least you're getting paid to take it. You know you're getting a nice yield on your loans are getting paid to accept some default risk here. That's very different. Then the circumstances that you're seeing in the long term bond market right now where you're running real interest rate risk in duration risk -- -- not being paid to take it. There is an economic risk if the jobless rate -- bounced back up. Borrowers would have a harder time paying back their loans peoples to rise and your returns will suffer. If you're worried about the legitimacy of the sites themselves take this to the bank. Last month Google bought a stake in lending club. And joining the club's board last year were former Morgan Stanley CEO John Mack and former Treasury Secretary Larry Summers.

Press CTRL+C (Windows), CMD+C (Mac), or long-press the URL below on your mobile device to copy the code

How to play banker on the web

Tuesday, June 11, 2013 - 02:57

Top News »

Most Popular »

Retirement »

Money Clip »

How to get out of debt How to get out of debt

Thu, Oct 30, 2014 - (3:37)

Will Apple Pay transform mobile payments? Will Apple Pay transform mobile payments?

Thu, Oct 16, 2014 - (2:45)

3 things to do before disaster strikes 3 things to do before disaster strikes

Wed, Sep 18, 2013 - (1:39)

Your must-do money list Your must-do money list

Wed, Sep 11, 2013 - (1:24)

The worst "best" financial advice The worst "best" financial advice

Wed, Sep 04, 2013 - (1:42)

Forget gold: The case for REITs Forget gold: The case for REITs

Fri, Apr 26, 2013 - (1:19)

3 rules for buying a house now 3 rules for buying a house now

Thu, Apr 18, 2013 - (1:39)

“Stalking” your dream home - Money Clip “Stalking” your dream home - Money Clip

Wed, Mar 27, 2013 - (2:50)

3 hidden tax deductions - Money Clip 3 hidden tax deductions - Money Clip

Thu, Mar 21, 2013 - (1:33)

How to break your prenup - Money Clip How to break your prenup - Money Clip

Thu, Mar 07, 2013 - (1:18)

Watch your wallet on Pinterest - Money Clip Watch your wallet on Pinterest - Money Clip

Thu, Feb 21, 2013 - (1:33)

Get set for the big bull run - Money Clip Get set for the big bull run - Money Clip

Thu, Jan 24, 2013 - (3:41)

Moving Pictures »

Images of December Images of December

Tue, Dec 23, 2014 - (0:30)

Tsunami - unclaimed possessions Tsunami - unclaimed possessions

Tue, Dec 23, 2014 - (2:23)

Images of November Images of November

Tue, Dec 02, 2014 - (0:30)

Images of October Images of October

Mon, Nov 03, 2014 - (0:57)

The world in a city The world in a city

Fri, Oct 31, 2014 - (1:30)

Real-life superheroes Real-life superheroes

Tue, Oct 28, 2014 - (1:44)

Dance of the northern lights Dance of the northern lights

Mon, Oct 20, 2014 - (1:08)

Images of September Images of September

Wed, Oct 01, 2014 - (1:00)

Still missing – MH370 Still missing – MH370

Fri, Sep 05, 2014 - (2:05)

Burning Together Burning Together

Mon, Sep 01, 2014 - (2:23)

Mending dolls, teddies and hearts Mending dolls, teddies and hearts

Fri, Aug 22, 2014 - (3:12)

Images of August Images of August

Fri, Aug 29, 2014 - (1:00)

"Old timers" sail the Chesapeake Bay "Old timers" sail the Chesapeake Bay

Mon, Aug 11, 2014 - (2:27)

Burned memories Burned memories

Fri, Aug 08, 2014 - (3:02)

Images of July Images of July

Thu, Jul 31, 2014 - (1:20)

World Cup: passion on the pitch World Cup: passion on the pitch

Fri, Jul 11, 2014 - (1:00)

A refugee in America gives back A refugee in America gives back

Thu, Jul 03, 2014 - (3:25)

A long search for refuge A long search for refuge

Fri, Jun 20, 2014 - (3:04)

World Cup: Around the globe in 50 goals World Cup: Around the globe in 50 goals

Fri, Jun 06, 2014 - (1:08)

VIVID – Sydney’s spectacle of light VIVID – Sydney’s spectacle of light

Fri, May 30, 2014 - (1:37)

The week that changed Boston The week that changed Boston

Mon, Apr 14, 2014 - (3:28)

360° snapshot of life in Kabul 360° snapshot of life in Kabul

Fri, Apr 04, 2014 - (1:26)

A blind teenager, living with vision A blind teenager, living with vision

Thu, Mar 27, 2014 - (3:51)

TIMELAPSE: Backstage at the Oscars TIMELAPSE: Backstage at the Oscars

Wed, Mar 05, 2014 - (2:49)

TIMELAPSE: Lunch with Oscar nominees TIMELAPSE: Lunch with Oscar nominees

Wed, Feb 12, 2014 - (2:55)

Sochi Highlights: Let the games begin Sochi Highlights: Let the games begin

Fri, Feb 07, 2014 - (0:40)

TIMELAPSE: On the Golden Globes red carpet TIMELAPSE: On the Golden Globes red carpet

Tue, Jan 14, 2014 - (3:28)

Pictures of the Year 2013 Pictures of the Year 2013

Fri, Dec 20, 2013 - (3:03)

Reuters Investigates »

Where the sea is closing in Where the sea is closing in

Thu, Nov 20, 2014 - (3:41)

Re-homing victim: "I could have been dead" Re-homing victim: "I could have been dead"

Wed, Feb 19, 2014 - (8:24)

Cops and loggers in the Amazon rainforest Cops and loggers in the Amazon rainforest

Fri, Jan 10, 2014 - (4:01)

"Passed around like a dog" "Passed around like a dog"

Thu, Aug 29, 2013 - (6:32)

Adopted, then abandoned online Adopted, then abandoned online

Thu, Aug 29, 2013 - (13:22)

How the DEA keeps its secrets secret How the DEA keeps its secrets secret

Mon, Aug 05, 2013 - (1:36)

How education lost its role as the great equalizer - Reuters Investigates How education lost its role as the great...

Mon, Dec 17, 2012 - (7:52)

Jihad Jane: From abused child to American jihadist - Reuters Investigates Jihad Jane: From abused child to American...

Sat, Dec 08, 2012 - (10:02)

Jihad Jane: The order to kill - Reuters Investigates Jihad Jane: The order to kill - Reuters...

Sun, Dec 09, 2012 - (10:40)

Lessons of the Jihad Jane case - Reuters Investigates Lessons of the Jihad Jane case - Reuters...

Sun, Dec 09, 2012 - (3:43)

Exclusive: Jihad Jane in her own words Exclusive: Jihad Jane in her own words

Sat, Dec 08, 2012 - (4:11)

Attorney: How a Maryland teenager became radicalized - Reuters Investigates Attorney: How a Maryland teenager became...

Fri, Dec 07, 2012 - (4:21)

Dateline Asia »

Asia stocks gain in January Asia stocks gain in January

12:40am EST - (1:25)

Samsung sees profits slide Samsung sees profits slide

Thu, Jan 29, 2015 - (0:57)

Chinese firms on overseas shopping sprees Chinese firms on overseas shopping sprees

Wed, Jan 28, 2015 - (2:28)

iPhone grabs top spot in China iPhone grabs top spot in China

Wed, Jan 28, 2015 - (1:40)

Robot replacements for Foxconn's workers Robot replacements for Foxconn's workers

Wed, Jan 28, 2015 - (1:12)

Alibaba could set sights on Yahoo Alibaba could set sights on Yahoo

Tue, Jan 27, 2015 - (1:24)

Fashion designers finding haste makes waste Fashion designers finding haste makes waste

Mon, Jan 26, 2015 - (2:07)

Be afraid, the Chinese are spending less Be afraid, the Chinese are spending less

Mon, Jan 26, 2015 - (1:33)

Asia markets shrug at Greek elections Asia markets shrug at Greek elections

Mon, Jan 26, 2015 - (1:36)

Asia markets toast ECB stimulus Asia markets toast ECB stimulus

Fri, Jan 23, 2015 - (1:42)

Asia Week Ahead: Markets await Greece vote Asia Week Ahead: Markets await Greece vote

Fri, Jan 23, 2015 - (1:18)

Netflix to push play in China Netflix to push play in China

Thu, Jan 22, 2015 - (1:41)

Japan in a tight spot over hostage crisis Japan in a tight spot over hostage crisis

Thu, Jan 22, 2015 - (1:05)

Behind the pretty face of K-pop Behind the pretty face of K-pop

Wed, Jan 21, 2015 - (2:09)

Record slowdown in China's economic growth Record slowdown in China's economic growth

Tue, Jan 20, 2015 - (1:52)

North Korean defector changes his story North Korean defector changes his story

Mon, Jan 19, 2015 - (1:03)

China stocks hit by credit crackdown China stocks hit by credit crackdown

Mon, Jan 19, 2015 - (1:16)

Xiaomi smartphones look to go global Xiaomi smartphones look to go global

Mon, Jan 19, 2015 - (1:54)

Clamping down on China's toxic toys Clamping down on China's toxic toys

Fri, Jan 16, 2015 - (1:11)

In China, a new a challenge to Apple In China, a new a challenge to Apple

Fri, Jan 16, 2015 - (1:09)

Ecstatic Filipinos cheer the Pope's arrival Ecstatic Filipinos cheer the Pope's arrival

Fri, Jan 16, 2015 - (1:11)

Investors rush to safe havens Investors rush to safe havens

Fri, Jan 16, 2015 - (1:35)

Hope from Japan's "economy watchers" Hope from Japan's "economy watchers"

Thu, Jan 15, 2015 - (1:34)

McDonald's tests a brand new image McDonald's tests a brand new image

Wed, Jan 14, 2015 - (1:19)

China's economy going to the hogs China's economy going to the hogs

Wed, Jan 14, 2015 - (1:36)

Second black box found in AirAsia crash Second black box found in AirAsia crash

Tue, Jan 13, 2015 - (1:11)

Facebook seeks friends in China Facebook seeks friends in China

Tue, Jan 13, 2015 - (1:37)

Made-in-China Volvos roll into U.S. Made-in-China Volvos roll into U.S.

Mon, Jan 12, 2015 - (1:18)

Sri Lanka votes strongman president out Sri Lanka votes strongman president out

Fri, Jan 09, 2015 - (1:12)