I’ve written before about my experiment with the social lending “Lending Club” site.
Well, I’ve had enough. The rate of return is barely half of the advertized (after 2 defaults and 2 notes paid off within months, I’m at ~6.5% net return, vs. >10% advertized for the most conservative portfolio offered to me). With such a rate, I can do better with mutual funds and ETF’s, without giving up the liquidity of my investment.
In addition, their customer service is below any minimal expectations. The web site has a lot of bugs, the error messages are not clear, and it is very difficult to understand what it is that you’re doing wrong. I have not received any proper tax documents. What especially got me upset is the ridiculous requirement to remember your old bank account if you want to change to a new one.
I mean, really? Not enough that they only allow linking a single bank account, but if you want to change from the one you closed before to a different one – you need to actually remember the account number you had set up there before! What world are they living in? I don’t even remember my own phone number, they want me to remember a bank account number for an account I’ve closed a year ago? What if the bank is out of business? What if the customer moved and cannot reach the branch to have the clerk retrieve the old account number?
Lending Club has a solution for them – pay them $15 and they’ll mail you a check. They’ve never heard of on-line identity verification, or a decent customer service. Well, I’m not going to be their customer.
Your Little Advisor.