After running long in core financial products' race, Citi group ex-CEO Vikram Pandit is betting on alternative technology, actually financial technology. And he is not alone, Thomas Glocer, former Thomson Reuters's CEO and couple of Venture funds are also betting for the same. We are talking about Orchard Platform, a Manhattan based company founded in 2013 and betting on peer to peer lending technology.
Peer to peer platform by Orchard allows you to invest as low as $25 and sell your lending to other, forming a secondary transaction for borrowing; that too in bits and pieces. The lending may be done by as small as an individual and as large as a banking institution. The lenders are able to examine credit scores and other details before funding the deal. They will receive both interest and principal payment.
Although this is not the first instance when industry veterans have or wall street has invested in peer to peer lending technology company. Lendingclub and Prosper Loans Marketplace are two biggies in this area, each originating $3 billion and $740 million in past 5 years. Lendingclub has backing of Morgan's ex-employee.
Vikran Pandit, Thomas Glocer, Spark Capitals and Canan Partners have all together invested $2.7 million in the venture. As per industry experts this model is going to disrupt traditional banking business model. As of now there are at-most 50 peer to peer lending firms operational in market. And this is going to be big as big data and technology is never going to end.
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