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There have been articles over the last few days in the Daily Mail and This is Money entilted "Savings fears as loan firm Quakle goes bust" and today in the FT entilted "Peer-to-peer loans company closes" about the demise of Quakle. This was bound to cause some waves, but I believe it is important to keep this in perspective. Quakle itself made less than 0.1% of all peer-loans so it was tiny in comparison to the market leaders Zopa, Funding Circle and RateSetter.
I remember reading about Quakle on the Zopa forum and after looking at the model I decided it was not for me. There appeared to be less checks performed on borrowers than would otherwise happen elsewhere. Less than a year after launch Quakle closed to new business. However this isn't the same as a bank going out of business as the contracts are between the borrower and the lender, not the borrower and the company, and are still legally enforceable. Quakle's collection agency are still chasing payments, and further action can and will be taken against borrowers who don't pay, just like any bank.
The peer-lending industry remains strong and is continuing to grow. There have already been announcements that there will be more new entrants to the peer-lending industry next year. Lets hope that these new entrants will join the P2P Finance Association which requires all companies to ensure high minimum standards of protection for consumers.