Lending Club Uses Social Media to Connect with Borrowers

Most of the major banks and other financial institutions haven’t made use of social media in any major way, but Lending Club, a California-based lending company, has made use of social media to promote and popularize its peer to peer lending platform.

Lending Club Senior Director of Product Strategy, Rob Garcia, recently told Bank Systems and Technology about their use of social media. Lending Club does not use social networking tools on its own website for security reasons, but does have a strong sense of social networking engrained into its business model. “We don’t want people to be sharing identity, password or loan information on a social network, that’s a scary proposition,” Garcia said. “We’re very careful about what we let people share.”

The company has made good use of social media in engaging its customer base and to get feedback from consumers of their product. “From a marketing perspective, we use social media to get people’s feedback on the site,” Garcia said. He noted that some borrowers promote their loan listings through social media tools such as Twitter, Facebook and personal blogs. He commented, “That’s good for creating buzz and adding investors to the platform, the loan typically gets funded in four to eight days.”

Lending Club has also made use of social media to verify information about borrowers and determine whether or not they are who they say they are. “We look at Twitter or Facebook personas for disconnects — why is this email associated with someone else? That helps us catch fraud among family members,” Garcia said. “Real people tend not to lie over social media.”

About Lending Club:

Lending Club is an online platform that enables the issuance of and investment in consumer loans. Lending Club brings together investors and creditworthy borrowers — eliminating the cost and complexity of traditional bank lending — to offer borrowers better rates and investors better returns. Lending Club was recently recognized as one of the 20 “Breakthrough Ideas for 2009” by Harvard Business Review, has been nominated for “Top 100 Innovators” by The Industry Standard, is on the JMP Hot 100 list, and the Always On Global 250 Top Private Companies list. In addition Lending Club won the Webby Award in 2008 for the “Best Banking Website”. Founded in 2006, Lending Club is headquartered in Redwood City, CA. More information is available at: http://www.lendingclub.com.