Lately, I’ve been hearing a lot about Prosper, which is a person-to-person finance site. Basically, people ask for a loan, and any number of people can offer a portion of the loan. If enough people are interested to fully fund the loan, the borrower will receive the loan.

As a borrower, it really doesn’t look that interesting — the interest rates generally seem very high compared to bank-based lending. However, once I actually have some money to invest, it looks like a pretty safe investment - if you spread loans of $75 among 100 people, for example, you would likely get a fairly good return on your money with very few defaults.

A little twist on the concept is Zopa. With Zopa, borrowers take out a personal loan from a bank, with a hope that friends (and random other people) will take out a CD from Zopa (at a very competitive rate), and designate a certain percent of their returns to help pay off the borrower’s loan. Looks like a very interesting way to get family and friends involved in your financial life. No risk to the people investing their money, and the possibility of good returns for the borrower.

If you’ve had any experience with solutions like these, I’d love to hear about it!