LendingClub’s LCX Platform to Get Client-to-Client Transactions

LendingClub, the parent of LendingClub Bank, on Wednesday (May 25) announced it is adding client-to-client sales to LCX, its automated loan-auction platform.

The new capacity will let institutional investors sell LendingClub loans to each other directly, the announcement said. The change, according to LendingClub, should increase the liquidity for parties involved in transactions.

The added liquidity made possible by the elimination of intermediaries in transactions should make the service more attractive to buyers and sellers of loans, said Valerie Kay, chief capital officer at LendingClub.

LCX reduces settlement periods to days from weeks and gives loan buyers more insight into what’s happening in the market. Originally tied to individual loans, the platform now can be used to purchase complete loan portfolios, according to LendingClub.

The timing of the service may be just right for investors, if LendingClub Financial Health Officer Anuj Nayar was on the mark when he told PYMNTS that many consumers are showing signs of being unprepared for the shock of rising inflation.

Read more: Inflation Forces Further Belt-Tightening Among Already Tight Paycheck-to-Paycheck Consumers

“What we’ve been predicting for months is what is now happening,” Nayar said in April. “Inflation is affecting everybody’s pocketbook, no matter if you are at the higher or the lower end of the income spectrum. There’ll be belt-tightening, and there’s no time like the present to step back and take stock.”

In conjunction with the announcement, Gustavo Binnie of Latin American investment bank BTG Pactual said: “The API-driven technology behind LCX allows for transparency and operational ease, which simplifies our buying process.”

San Francisco-based LendingClub was launched 15 years ago.