WASHINGTON—The Consumer Financial Protection Bureau is now accepting complaints from consumers encountering problems with loans from online marketplace lenders.
The Bureau said it is also releasing a consumer bulletin that provides an overview of marketplace lending and outlines tips for consumers who are considering taking out loans from these types of lenders.
“When consumers shop for a loan online we want them to be informed and to understand what they are signing up for,” said CFPB Director Richard Cordray. “All lenders, from online startups to large banks, must follow consumer financial protection laws. By accepting these consumer complaints, we are giving people a greater voice in these markets and a place to turn to when they encounter problems.”
Marketplace lending—often referred to as “peer-to-peer” or “platform” lending—is relatively new and includes companies such as Lending Club.
A marketplace lender uses an online interface to connect consumers or businesses seeking to borrow money with investors willing to buy or invest in the loan. Generally, the marketplace lending platform handles all underwriting and customer service interactions with the borrower. Once a loan is originated, the company generally makes arrangements to transfer ownership to the investors while it continues to service the loan.
The CFPB’s consumer bulletin offers information for consumers who are considering a loan from a marketplace lender.
Meanwhile, the CFPB noted it began accepting complaints as soon as it opened its doors nearly five years ago in July 2011. Because marketplace lenders offer several types of consumer loans, a consumer submitting a complaint must select among the different complaint categories for products and services that best apply to their situation.