Got an idea for a business but need some extra funds? Prosper cuts out the middle man (banks) by being "the online marketplace for people-to-people lending". They charge a small fee to both borrowers and lenders but you have control over what you invest in or who invests in you. (Only available in US currently)
Peer-to-peer lending has the double benefit of helping out people who don’t qualify for traditional loans, while giving fairer returns to those who invest their extra cash. This is no smooshed together idealistic service either, Prosper is serious about finance: your credit rating gets checked and if you don’t pay the loan back you will be refered to the debt collection agency. The loans are also small, you can ask for anything up to $25,000, but the end result can be a combination of funds from any number of investors, so their risk is minimised.

We are big fans of knowing where our money goes to and comes from. Investors normally have entrust their money to a bank who can invest in any old thing they like, and banks aren’t known for having the most ethical of investments. It’s also a great way to get personal contact with people who have money and really back your idea.

I found out about prosper from Beancounter, who wrote a very nice review that you should also check out, and because sometimes thes ideas seem just a little too wild and crazy to actually invest in, check out Propser’s media center for real life stories of people using the service. I will try to keep you updated to the progress of the peer-to-peer banking craze down towards this end of the planet :)