How P2P lending is changing the credit industry: "Cory Doctorow: Salon's Farhad Manjoo has a long feature today about new, net-based peer-to-peer loan services. These services, like prosper.com, encourage borrowers to post personal accounts of their financial situations -- the kind of material that doesn't show up on a credit report, like the fact that you accumulated your debt going through school and are about to graduate into a good job -- and then allows individuals to act as lenders by putting small sums together in a syndicate to make the loan. So if you want $5,000, you might get it from 50 people who share your interest over three years. Interest rates are also determined between lenders and borrowers, and are much lower than the predatory high-risk rates charged by credit cards and payday loan centers (which can charge a whopping 521 percent API). Lenders are encouraged to diversify their loans, spreading out their investment in $50-or-up chunks that are spread among borrowers with different risk profiles. The sites report that their default rate is no worse than a credit-card company's, even though t"