This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Lending Club Is First of Many Disruptive Bank-Techs to Go Public

NEW YORK (TheStreet) -- Peer-to-peer lending is going public. Lending Club, an online-only bank, announced it is planning a stock offering. But, this is just the leading edge of Silicon Valley's move into the banking business.

This effort is typical of how Silicon Valley does business. First, pick out an industry, next, transform the various pieces of the industry through technology and then see the industry respond. While large banks have focused on providing "one stop" banking, the wave of the future appears to be going to different providers that address specific needs.

Read More: Warren Buffett's Top 10 Dividend Stocks

Banking is being transformed and something like Lending Club is a great way to get involved and be a part of the new wave. You can be sure this is the first of many more.

Like many of the companies in this crowd funding space, Lending Club uses sophisticated computer algorithms and "big data" to screen borrowers and lend money to those whose loans are too small or whose credit may seem a bit shaky.

This is typical of what is happening today. Not only have a substantial number of other peer-to-peer lenders been started, there are other "new" lender-types that are moving onto the bankers turf.

This is the future. Banking has to change. Take a look at the current lot of teenagers. They never go into banks and wonder what all those "little" bank buildings are for. But, they are very familiar with electronic gadgets. In five to ten years, these individuals will be the foundation of the new wave of "bank" customers. Banking is going to have to change to accommodate them. As a consequence, there are going to be a large number of Internet-based companies coming public over the next few years.

For another example, let's take the payments system, long the bread-and-butter of the commercial banking system. What is the future of the payments system?

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $124.25 -0.14%
FB $81.66 -0.67%
GOOG $542.56 -0.99%
TSLA $187.59 -0.63%
YHOO $44.13 -0.69%

Markets

DOW 17,698.18 -77.94 -0.44%
S&P 500 2,059.69 -8.20 -0.40%
NASDAQ 4,880.2280 -20.6570 -0.42%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs