People2Capital.com: Poised to Issue P2P Student Loans This Fall
I had the opportunity to hold an email interview with Alan Samuels, Chief Product Officer at People Capital this past week regarding their new P2P student loan platform.
People Capital will be launching this fall—first to institutional accredited investors under a private placement memorandum, and later they’ll be filling a S-1 to open their platform to all prospective peer to peer lenders.
People Capital will be providing legally-compliant “private student loans” which are not bankrupt-able, unlike other P2P loans. Mr. Samuels cites a potential $113 Billion gap in federal college funding limits and the actual costs of college attendance in the USA as a growing market for these private student loans. Also, many lenders are shying away from investing in student loans due to college students' lack of established credit history and the difficulty of measuring risk without a credit score.
Samuels explained to me how People Capital can navigate this marketplace better than any of the competition due to their patent-pending “Human Capital Score” which is a proprietary underwriting tool. The Human Capital Score will include the students’ field of study, test scores, and GPA to determine the student’s creditworthiness.
Loans will be available on a long term or short term basis, and a requirement of being a legally-compliant private student loan, enrollment verification is mandated. Like other P2P loans funding isn’t guaranteed, and depends on how attractive the borrower’s request is to prospective lenders, and how large the pool of lenders is.
People Capital is in Series B funding, and has just received an additional $500,000 from The Serious Change Fund, helmed by investor Josh Mailman. (Source: WealthReview News)
Jessica Ward is a freelance writer in the Seattle area and writes on family and finances. You can follow her on Twitter as @Jessc098