In the US, two peer-to-peer lenders made initial public offerings in December 2014, namely LendingClub, which loans money to consumers, and OnDeck, which serves small businesses.
Now, after an initial trial period where it offered small loans - USD 50,000 or less - to Canadian firms, OnDeck has set its sights on expanding north of the border, joining a handful of homegrown startups including Fundthrough, which lends to small businesses, and Grouplend and Borrowell, serving consumers.
OnDeck, which has delivered over USD 2 billion in loans since 2007, will now be offering loans of up to USD 150,000 to Canadian companies.
For consumers, peer-to-peer loans are cheaper than typical credit card rates and less cumbersome than borrowing from a bank. For small businesses, borrowing from marketplace lenders may cost more than going through a bank. However, many small business owners dont have a choice.
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