SAN FRANCISCO, Nov. 12, 2014 /PRNewswire/ -- Lending Club, the world's largest online marketplace connecting borrowers and investors (https://www.lendingclub.com), announced today the introduction of a new product offering through its Springstone subsidiary. Springstone facilitates financing for consumers seeking elective medical procedures and early education learning through thousands of healthcare providers, K12 schools and learning centers.
The new product offers no interest financing for a period of 6, 12, 18 or 24 months, depending on the specific plans offered by the healthcare provider. With the new product, borrowers make equal monthly payments that are designed to encourage them to pay off the full balance within the promotional period. If a customer happens to have a balance at the end of the promotional period, interest based on a variable Prime Rate index is charged on the outstanding balance only from that point forward. The new product is dubbed "True No Interest for X Months" to differentiate it from the deferred-interest product typically available in patient financing and other areas of purchase financing where if borrowers do not pay the loan off in full during the promotional period, they pay retroactive interest from the date the charges were first made.
"We're really excited about this product launch," said Lending Club's founder and CEO Renaud Laplanche. "We were able to leverage Lending Club's resources and market insights to create a better, more consumer-friendly product. Many consumer advocacy groups and the Consumer Financial Protection Bureau have raised questions about deferred-interest products in patient financing, and we're proud to lead the way in delivering a more consumer-friendly alternative that we believe provides enhanced transparency for borrowers."
Concurrently with the launch of the new product, Springstone is also implementing a series of patient-friendly policies designed to ensure that consumers fully understand their financing options and can make informed decisions, including a 3-day "consideration period" for dental consumers to request a full refund when a provider's office applies on their behalf for an amount in excess of $1,000, a requirement that services charged must be started within 30 days, enhanced provider training, and revised disclosures that communicate the new product terms in a straightforward way.
Education and patient financing customers will continue to also have access to fixed rate installment loans.
Lending Club's online marketplace is designed to provide a more efficient mechanism to allocate capital between borrowers and investors than the traditional banking system. Since launching in 2007 the platform has facilitated over $6 billion in loans, including nearly $1.2 billion in the third quarter of 2014, and the company has built a trusted brand with a track record of delivering exceptional value and satisfaction to both borrowers and investors.
About Lending Club
Lending Club's mission is to transform the banking industry to make credit more affordable and investing more rewarding. The company's technology platform enables it to deliver innovative solutions to borrowers and investors. Lending Club has been prominently recognized as a leader for its growth and innovation, including being named one of Forbes' America's Most Promising Companies three years in a row, a CNBC Disruptor two years in a row, a 2012 World Economic Forum Technology Pioneer, and one of The World's 10 Most Innovative Companies in Finance by Fast Company. Lending Club is based in San Francisco, California. More information is available at https://www.lendingclub.com. Currently only residents of the following states may invest in Lending Club notes: CA, CO, CT, DE, FL, GA, HI, ID, IL, KY (accredited investors), LA, ME, MN, MS, MT, NH, NV, NY, RI, SD, UT, VA, VT, WA, WI, WV, or WY.
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SOURCE Lending Club