Peer Review

Peer-to-Peer Lending

Material Detail page

Reviewed:: Feb 19, 2021 by Business

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Ratings

Overall Rating:

Content Quality:

Effectiveness:

Ease of Use:

Overview:

This article discusses Peer-to-peer lending, a relatively new method for obtaining credit for borrowers that are unable to take advantage of traditional lending sources by connecting borrowers directly with investors instead of traditional lending institutions. Undergraduate students will realize the increasing popularity and benefits of capital sources outside of the normal, traditional lending institutions and the risk/return trade off. The student edition is readily accessible in pdf or html format.

Type of Material:

Assignment

Recommended Uses:

Recommended for in class discussions, lecture, research, and analysis projects

Technical Requirements:

browser (Firefox) or pdf reader

Identify Major Learning Goals:

Students will realize the increasing popularity and benefits of capital sources outside of the normal, traditional lending institutions and the risk/return trade-off.
The reader will have an understanding of Peer-To-Peer Lending.
Users will learn the importance of maintaining a good credit score.

Target Student Population:

Undergraduate college students - Finance, Business, Economics
Freshman and sophomore business students as part of a personal finance class or introduction to finance class.
May also be used as a reference tool in a Money and Banking, Financial Policy, or Investment Analysis course.
In the current economic environment, this article is relevant in studying the increased use of such tools due to economic uncertainties.

Prerequisite Knowledge or Skills:

Basic knowledge of loans.

Content Quality

Rating:

Strengths:

A direct, concise, and relevant concept that is very popular in financial discussions today.
Great graphic to describe how a credit score is determined.
Great research links in the “Notes” section at the bottom of the article.
Easy citation with the "cite this article" link
The information is easy to understand.
It is presented in a user-friendly format.
Someone with limited knowledge of loans will find the glossary useful.

Concerns:

None

Potential Effectiveness as a Teaching Tool

Rating:

Strengths:

Industry-specific terminology is clearly defined.
Great graphic to describe how a credit score is determined.
Supplementary material for teachers with email registration (Economic Lowdown)
Free student subscription to the Economic Research newsletter
The material was clearly presented and easy to read.

Concerns:

Could be enhanced with some sort of interactive tool to reinforce knowledge of the industry-specific terms used. Perhaps add a few links to other interactive services and free tools available to students.
One of the companies discussed, Lending Club, as well as all three of the credit bureaus has interactive sites to assist with consumer awareness.

Ease of Use for Both Students and Faculty

Rating:

Strengths:

Very informative and concise.
A great deal of information presented in a cohesive and efficient format.
Industry-specific terminology is clearly defined.
Great research links in the “Notes” section at the bottom of the article.
Supplementary material for teachers with email registration (Economic Lowdown)
The material clearly explains Peer-to-Peer Lending, including the risks involved.
It also outlines alternatives, which encourages further research.

Concerns:

The article does stimulate interest but external links to other helpful resources related to the topic embedded in the article may reinforce its applicability as a teaching and learning tool.

Other Issues and Comments:: This is a great read for business students to understand the basic concepts of risk and return as well as credibility. Credit influences perceived risk with influences the rate of return demanded for access to capital.
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