How Peer Lending Works | LendingClub

A smarter way to invest and borrow.

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How does

an online credit



LendingClub uses technology to operate a credit marketplace at a lower cost than traditional bank loan programs, passing the savings on to borrowers in the form of lower rates and to investors in the form of solid returns. In fact, borrowers who are just paying the minimum on their credit cards could save nearly $1,300 over the course of their personal loan through LendingClub. 1

By providing borrowers with better rates, and investors with attractive, risk-adjusted returns, LendingClub has earned among the highest satisfaction ratings
in the financial services industry. 2

Innovation transforms lending

LendingClub is America’s largest marketplace connecting borrowers and investors, where consumers and small business owners lower the cost of their credit and enjoy a better experience than traditional bank lending, and investors earn attractive risk-adjusted returns. 4

Here's how it works:

  • Customers interested in a loan complete a simple application at
  • We leverage online data and technology to quickly assess risk, determine a credit rating and assign appropriate interest rates. Qualified applicants receive offers in just minutes and can evaluate loan options with no impact to their credit score
  • Investors ranging from individuals to institutions select loans in which to invest and can earn monthly returns

The entire process is online, using technology to lower the cost of credit and pass the savings back in the form of lower rates for borrowers and solid returns for investors.

Better for Borrowers

We cut the cost and complexities of traditional bank loans and pass the savings on to borrowers.

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  • Easy online application
  • Low fixed rates
  • Fixed monthly payments
  • Flexible terms
  • No prepayment penalties
  • Friendly service
How it works:
  1. Check your rate - it's fast and free
  2. Choose your offer, if given
  3. Watch as people invest in your loan
  4. Fast funding directly to your bank account
  5. Convenient, automated fixed monthly payments
  6. Prepay anytime with no fees

Check Your Rate

Better for Investors

At LendingClub you can earn attractive risk-adjusted returns by quickly and easily investing in a diversified portfolio of loans.

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  • Solid returns with historical returns
    by Grade A-C of 4.95% to 7.10%. 5
  • Monthly cash flow
  • Simple and straightforward
  • Easy to diversify across many Loans
  • 401(k) rollover and retirement accounts available
How it works:
  1. Open an account and transfer as little as a $0.01 minimum initial deposit.
  2. Quickly and easily build a portfolio by investing in a range of Loans in increments as little as $25
  3. Receive monthly payments of principal and interest as borrowers repay their loans
  4. Reinvest payments or withdraw

Start Investing

Your privacy is protected.

LendingClub strongly protects your personal and financial information. Investors and borrowers never know each other's identities; we will never sell, rent or otherwise distribute your information; and we only share what's necessary to complete your requested transactions. See our Privacy Policy for full details.

We're committed to transparency.

We’re proud to share information about our company and our services. Our website contains background information about LendingClub, and our statistics area gives a wealth of information on loan and investor performance. We also offer a downloadable file containing the credit and performance details on all loans eligible for funding by public investors.

1 Savings vary per customer. 3,690 randomly selected borrowers in a survey conducted from 1/1/18 – 11/30/18 reported an average interest rate on outstanding debt or credit cards of 20.5%. Assuming 3% annual fees, based on CFPB, “The Consumer Credit Card Market,” 2015, that yields an APR of 22.74%. From 1/1/18 – 11/30/18, borrowers who received a loan via LendingClub to consolidate existing debt or pay off their credit card balance received an average APR of 19.2% and average loan size of $14,700. With a paydown period of 36 months on an initial balance of $14,700, the monthly payment for credit cards is $550.06 vs. $513.91 for a personal loan, for total savings of $1,290.88 in interest and fees.

2 All loans made by WebBank, Member FDIC. Your actual rate depends upon credit score, loan amount, loan term, and credit usage & history. Source for savings % and satisfaction scores: LendingClub borrower surveys, 2013 – 2017.

3 This depiction is a summary of the processes for obtaining a loan or making an investment. All loans made by WebBank, Member FDIC, Equal Housing Lender. Investors do not invest directly in loans. Investors purchase Member Dependent Notes from LendingClub. Individual borrowers must be a US citizen or permanent resident and at least 18 years old. Valid bank account and social security number/FEIN are required. All loans are subject to credit review and approval. Your actual rate depends upon credit score, loan amount, loan term, credit usage and history. LendingClub notes are issued pursuant to a Prospectus on file with the SEC. You should review the risks and uncertainties described in the Prospectus related to your possible investment in the notes. Currently only residents of the following states may invest in LendingClub notes: AL, AR, AZ, CA, CO, CT, DC, DE, FL, GA, HI, IA, ID, IL, IN, KS, KY, LA, MA, MD, ME, MI, MN, MO, MS, MT, ND, NE, NH, NJ, NV, NY, OK, OR, RI, SC, SD, TN, TX, UT, VA, VT, WA, WI, WV, or WY. Our mailing address is: LendingClub, 595 Market, Suite 200, San Francisco, CA 94105.


5 4.95% - 7.10% average historical returns for loan grades A through C as of March 31, 2017. To be included in the historical returns ("Historical Returns") calculation, a Note must have been originated prior to September 30, 2015. Historical Returns are LendingClub's adjusted net annualized returns ("Adjusted NAR") for Notes with Grades A through C. Adjusted NAR is calculated using the formula described here . Historical returns are based on actual borrower payments received each month, net of fees, actual charge offs, recoveries, and estimated future losses. To estimate future losses, we apply a charge-off rate estimate to the outstanding principal of any loans that are past-due but not charged off. The charge-off rate estimate is based on historical charge-off rates by loan status over a 9-month period. Historical performance is not a guarantee of future results. LendingClub Notes are not insured or guaranteed and investors may have negative returns. Individual portfolio results may be impacted by, among other things, the size and diversity of the portfolio, the exposure to any single Note, borrower or group of Notes or borrowers, as well as macroeconomic conditions. Notes are offered by prospectus filed with the SEC and investors should review the risks and uncertainties described in the prospectus prior to investing in the Notes.

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