There was a presentation about Zopa which gave an overview. There’s no need to repeat it here except to say that the top requests at the moment are for car loans, weddings and (which I have to say I was surprised about) surgery and medical expenses. And a note to the Chancellor: they have only 0.2% bad debt.
There was also a talk from Kubera money, about “rotating savings and credit associations” (ROSCAs) but the chap said he didn’t want to give away anything about the company because it was pre-launch so I didn’t write anything down. He did introduce some interesting points about the way in which these kinds of credit associations work in existing trusted circles (and therefore don’t need to credit check, which saves lots of money) and I thought that might be an interesting subject to explore at a future seminar.
Midpoint & Transfer introduced us to the “foreign exchange revolution”. The idea is to match currency buyers and sellers directly and cut out the exchange (and spread) from f/x transactions. It all sounded quite promising — I worked on a feasibility study for a similar idea for a UK-based financial services company about five years ago, only for a handful of major currencies, but they concluded that it was not something they wanted to pursue — and I thought their claim that they would guarantee that any f/x would match intraday was bold (it turns out that they will buy the currency needed to make the match if no sellers are on the system).
I enjoyed the panel discussion, because I always enjoy panel discussions that have real experts on them and James, Giles and Umair all made terrific points. A couple of memes that I have flagged for future reflection: the cost of regulation (is it worth it?) and the scaling of social lendin (does it only work on a small scale),
Now, of course, I was more interested in the digital money aspects rather than the lending aspects, but the idea of creating new currency by creating new kinds of “credit” is central, I think, and to follow Umair’s lead and demand that genuinely innovative thinking about banking means genuinely innovative thinking about culture and relationships, it makes me wonder about the kind of structures that make sense. Suppose, for example, I lend (via Zopa) not Sterling or Euros but bandwidth or entertainment? Could I match (like the Midpoint and Transfer guy) supply and demand closely enough to make the business model work, like a barter system for future and options?
None of this seems implausible to me — and other people, such as lateral thinking guru Edward de Bono (who wrote the CSFI pamphlet on “The IBM Dollar“) — have had the idea before, but I wonder if we are at a technology-induced cusp, where the pervasiveness and maturity of mobile phones means that transacting in a subset of truly exotic currencies becomes viable? I’m going to write an article about this for a magazine.
These opinions are my own (I think) and presented solely in my capacity as an interested member of the general public [posted with ecto]