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Investing in Lending Company

I have lately seen adds for something called “peer to peer lending” which sounds like it would be a good thing to invest in, as there are minimal losses involved. However, the question is if there is an issue of ribis involved?

To cite a specific company the Lending Club www.lendingclub.com.

Answer:

According to most authorities, there would be no prohibition in investing in such a company, provided that the owners of the company (or the majority shareholders) are not Jewish. For further details, see the article on the site entitled “Kosher Shareholding.”

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2 Comments

  1. This answer appears to be misunderstanding the question. Peer to Peer lending does not involve an ownership stake or shareholding in the lending company; it involves direct loans to individuals enabled and processed by the given lending company (in this case Lending Club). See their website for a full understanding of the model.

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