Why are these lenders important to the financial system

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Reference no: EM131107434

In the recent past, small business lenders (for example 'biz2credit', 'kabbage', 'CANCapital', and 'LendingClub') have become popular. Their major function is to provide loans to small businesses to carry on the day-to-day business operations. You may not need to do research in order to answer the following questions. But most definitely you would have to use your analytical mind and make connections to the material learned in the class.

a) Why are these lenders important to the financial system? Include the competition from the financial institutions (such as commercial banks, shadow banks) discussed in the class.

b) What do you think about the long run sustainability of these lenders? Think about what does it take to survive as lenders and what may be major hurdles for their survival.

Reference no: EM131107434

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