Charles Moldow, General Partner at Foundation Capital, believes the peer-to-space will exceed the $1 trillion mark as soon as 2025.
The alternative finance space has been rife with lofty predictions of late, but none have been quite so extravagant as Moldow’s forecast. It is certainly true that peer-to-peer lending is on a steep upward trajectory. As AltFi Data continues to remind us, growth rates across the sector are consistently staggering. Rarely does a platform’s monthly expansion rate dip below 5%. If such performance continues over a sustained period of time, perhaps scale of the kind predicted by Moldow is inevitable. And as he aptly points out – US consumers paid a massive trillion dollars in credit card interest alone throughout the 2000s. There is a stark, worldwide need for the fairness and efficiency that peer-to-peer can provide.
“Traditional lending works well. For the banks. For centuries, banking has remained fundamentally unchanged. In the simplest terms … banks played a part in the community, and served community needs. Today, they do neither. Consolidation has created national mega-banks that are more financial mega-stores than they are pillars of the community.
“But today technology and innovation are making possible a new generation of financial services that are more affordable and more available. That’s why we believe what we’re calling marketplace lending will be a trillion dollar market by the people, for the people.”