I have always been beyond irritated with banks and the way the do business. Essentially paying ridiculous low interest rates on savings accounts and then charging extremely high interest on credit cards and signature loans. Well the Internet and a new online startup called Prosper.com has the potential to shake up the banking industry.
Here is how it works your looking to make some of your money work better for you, well you deposit some it with prosper.com and then when someone needs a loan they apply and then you can bid on how much money you will lend. Prosper.com only takes 1% of the fee and you keep the difference.
Prosper.com does a credit history on each loan applicant so you have essentially the same info the bank has when making loan recommendations. For those of you that want to diversify your portfolio a little this may be the answer. Banks are already using your money isn’t it about time we got our fair share of that revenue. [NYT]