BizSugar.com › Raising Capital › Smaller Business Will Increasingly Bypass Traditional Funding Methods

How will small and midsize business fund their IT spending next year? Don't be surprised if many turn to online peer-to-peer (P2P) lenders. P2P lending will continue to surge in 2008, even as the economy teeters on recession. According to the Wall Street Journal,"Roughly $100 million in new person-to-person loans will be issued this year [2007], mostly by Prosper.com, with new loan originations expected to jump to as much as $1 billion in 2010 and $9 billion in 2017, according to Online Banking Report, a research firm." Most started as consumer sites, but many P2P lending sites now offer business loans to help smaller businesses get off the ground or expand without having to go through traditional financial channels: