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So offer more. It seems like, this case of fraud notwithstanding, there's plenty of room for new participants in this market. Suppose you were to show up and
by fredkbloggs 11y ago
So offer more. It seems like, this case of fraud notwithstanding, there's plenty of room for new participants in this market. Suppose you were to show up and offer these people an effective interest rate of 12% instead. Surely even someone with a mental disability would take $100 instead of $50 for the same thing.
- mikeash 11y agoI don't really feel like being a bank, though. There's already plenty of competition for loans, this is just a case where predators are soliciting customers who don't understand that, and probably don't even know that the product they're signing up for is a loan. Maybe it means there's room for better marketing by banks in this space, although there can't be that many clients. It may be that it's only worth targeting this group if you rip them off outrageously.
- fredkbloggs 11y agoPossibly. I know for sure that I would love to have access to this market. I would be happy to offer a much more fair price than the existing players are paying. In a ZIRP world, who wouldn't love 12%? Or even 8%? We're all banks, whether we like it or not. It might not be worth it for Citigroup, but a $100m market is definitely worth it for you and me. Just look at LendingClub and Prosper.