zcommodore

Most who read this blog know that I am the group leader of this group on Prosper.  I only point it out for those reading this from other sources.  I've had my ups and downs as it relates to being a group leader--ups from helping difficult HR borrowers get funded to downs when I couldn't get others funded, to say nothing of the frustration when one of the borrowers in my group stopped paying his loan.  I read a lot in the forums and see what lenders say about groups and their frustration with group leaders who are in it only for the rewards.  I see a lot of calls for Prosper to abandon groups entirely.

Today, after reading this thread on the Prosper forums, I am ready to agree with the other lenders who see nothing but scam artists being attracted to acting as group leaders on Prosper.  The rewards Prosper gives group leaders are nice but where there's money to be made, there will always be some scam artist looking for a way to make a quick buck.

I like the idea of person-to-person lending--helping people who need money to get money at a reduced rate while at the same time making a little myself.  If there were no rewards associated with being a group leader, I might not have started my group.  I started my group since I was already helping borrowers get funded by giving advice in the forums.  I figured I might as well get a small bit of compensation for my time so I started my group.  I do like helping people and this was just the next step for me.

Looking back over the time I've spent on Prosper which is rapidly approaching a year now, I remember some of my initial thoughts when I first came across the site.  I saw interest rates in the teens and thought, wow!  I can get a lot more than 5% on my money there rather than here in a savings account in addition to helping people by saving them money as well.  After reading up on the GL rewards/fees I remember thinking this is one way for scam artists to take advantage of people.  But I started a group anyway.

If anyone from Prosper reads this, go ahead and close down the group system.  There are only a handful of group leaders who lenders respect and they will understand I'm sure.