Big growth potential! Morgan Stanley estimates that less than $25 million has been lent to consumers so far by SocietyOne and competitor RateSetter. A third P2P lender, MoneyPlace, is preparing to launch. Marketlend and UK-based Thin Cats are also in the Australian market offering P2P loans to small businesses but P2P SME lending so far has been negligible.
The value of loans made through peer-to-peer lending platforms in Australia will surge to $22 billion in the next five years, investment bank Morgan Stanley predicts - crimping the profits of the big banks and forcing them to speed up investment in new technology. By 2020, P2P lending to Australian consumers will soar to $10.4 billion and comprise 6 per cent of total consumer lending in Australia, suggesting the investment in Australian market P2P leader SocietyOne by media moguls James Packer and Ryan Stokes in December was well-timed. In addition, P2P lending to small businesses would grow to $11.4 billion over the same period, Morgan Stanley said, at rates of growth faster than consumer credit, given constraints on big bank lending to SMEs.