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Assisting consumer cash flow is the core goal of consumer to consumer Crowdlending. Interestingly, the market is now starting to mature from simple consumer loans, where the recipient choses where and how to spend the money, into products designed to tackle specific cash flow issues aligned with additional benefits as part of a package.
A novel approach to this is a new startup called CommuterClub. They combine a low-cost instalment plan loan so commuters can access savings offered by annual public transport passes. The tickets are funded up front through peer-to-peer lending and then customers can pay a monthly fee with interest on top. The overall cost for the year ends up cheaper than buying monthly travel passes and commuters can cancel at anytime.
With 2.5 million regular commuters in London alone, this is an interesting entrant into productised Crowdlending. The challenge for CommuterClub will be reaching these people and convincing them that their rate of 5.6% with the benefits outweighs a straight forward loan – with personal finance players outside Crowdlending like Hitachi Finance offering loans at 4.3% APR heavily marketed on the underground, this is going to be an interesting battle of bank versus Crowdlender.