An interesting tidbit embedded in the news is that $22mm in loans was sold to a single investor - the model they talk about on the website is peer to peer, but this appears more peer-to-institutional-buyer (which I always kind of suspected, but this clarifies it)...
The language around the industry has changed over the past year as institutional investors began to make up more of the loan buying volume-so the name changed from "P2P" to "Marketplace Lending"
I think a lot of their volume is peer-to-peer, though, and there's nothing saying this $22m was from an institution and not a rich individual (though an institution seems more likely). I imagine this is more of a case of "I have a lot more money than your normal customer so I want special treatment" and Lendingclub then abusing that to take advantage of the investor. I wonder if the investor had taken their $22m to the automated web platform and setup their investment criteria if this would never have occurred.
I think you're dramatically underestimating the degree to which institutional investors are involved in peer-to-peer. There are entire software startups selling analysis software to hedge funds for peer-to-peer lending.
It almost certainly was not a single wealthy individual.
But how many loans was that? If that's $25 in 1 million loans, then there are other peers on each loan. Whereas if it's 22 thousand 1k loans, it's definitely just an alternative route to institutional lending.
An article on the trend: http://qz.com/355848/wall-street-is-hogging-the-peer-to-peer...