Much has been written over the years about the increasing disintermediation of the banks. Their traditional role as lenders and – via their investment banks – issuers of equity capital, has been undermined by other market participants such as hedge funds, mutual funds and private equity firms.
Now, individuals are beginning to participate in this process too; lending to individuals via peer-to-peer lending schemes, and raising equity capital via crowd funding in search of a return. This edition of Acuity explores peer-to-peer lending, concluding that it’s an interesting innovation, but riskier than it might at first seem – and it will be a while before it’s a mainstream investing activity