Banks are centralised institutions that, among other things, offer credit to individuals, groups and corporations. Historically, banks were a nexus of borrowers and lenders, matching the supply of liquidity to the demand for credit. The primary role of a bank was risk management in the form of the due diligence required to assess if a potential borrower was a worthwhile investment. With the advent of nation-state money printing and fractional-reserve banking, whereby money is lent into existence and losses are publicly subsidized by inflation and bailouts, the traditional care of risk management for loans has all but been obiliterated.
Peer-to-peer (P2P) lending has emerged as a means to decentralise the oligopolistic hold that banks possess in every category for lending. While P2P lending is still in early days, regulatory pressure is mounting making P2P lending