Thursday, March 14, 2013
Prosper has decided to stop making bid information available. Currently all of the information I have about lenders is deduced from bids. Lenders are tied to bids, bids are tied to listings, and listings that get funded are tied to loans. Without the bid data this association falls apart and it will be impossible to track lender investments going forward.
Prosper has stated that they are doing this for privacy reasons. I can respect the fact that some lenders feel that to much information was being divulged However, I have to strongly disagree with the choice Prosper has made to address these lenders' privacy concerns. There were other approaches that could have been taken that would have struck a better balance between the desire for data transparency of some lenders with the desire for increased privacy of other lenders. First off, Prosper could simply have removed the linkage between lenders and bids and published anonymous bid data. Doing this would still have allowed better transparency of listing availability. Lenders could use this anonymous bid data to properly take into account timing constraints on their bidding strategies (because lets be realistic, with the current volume of listings, timing is critical since listings go quickly) as well as allowing retail investors to see if they even have a chance of investing in the current environment by knowing if loans are being eaten up in 1 or 2 bids. Taking this one step further, Prosper could have created an opt-out mechanism so only lenders who choose to opt-out would have their bid data published anonymously. This would have allowed for data analysis just like we have today (using tools such as those that my site currently provides) for a sizable portion of the Prosper data set, while still allowing privacy for those lenders who want it. Both of these options were presented to Prosper months ago, yet with no notice to their user community, they just started removing the availability of bid data. I find this to be a rather upsetting turn of events and wish that Prosper had handled it differently.
Now that my personal opinion is out of the way, let me clarify how this will impact my site in the short term:
Top Lenders will become more and more out of sync with reality as time goes on since no new loan information will get incorporated into lender portfolios. I will probably just remove this section of the site after awhile.
The Lender Activity page is still partially working since bids have only been removed from the data export at this time and the open/closed listing information is pulled from the API. However the API is supposed to be changed shortly as well. This will effectively render this page useless and I will delete it some time after the API is changed.
Previously Late Loans will continue to let you track loans that I know about, however no new loans will show up and you will have to go back to whatever your previous system was for tracking late loans (good luck with this one!).
Loan Analysis searches that use screen names and note size filters will only return results for older loans where I have bid data.
Now to address how this will impact my site long term:
I don't know what I am going to do! There is another major change that is supposed to come out shortly. Prosper is updating their API to have additional data elements for all listings. This change is not going to be incorporated into the data export. This means I have two options.
Option 1 is to leave my site mostly as is, which means half of it will have outdated information and the Loan Analysis will only support a subset of the data elements that Prosper will have available (i.e. those available in the data export).
Option 2 is to rewrite portions of my site to pull all the data from the API and allow searching on all available data elements. As part of this I would abandon the Top Lenders and Lender Activity pages. Using the new API I should theoretically be able to write new portfolio management tools as well (i.e. tools similar to the Previously Late Loans tool, as well as new ones) by allowing people to register their new API credentials and querying their personal note portfolio through the new API methods.
My availability of free time will be a major deciding factor on what happens going forward. I have some personal matters going on that are taking up a lot more of my time now then I did when I originally put this site together, so it is a wait and see for me as much as it is for everyone else.
P.S. I have been in touch with Prosper and have access to a beta version of the API and have started to plan out how I will change the site if time permits...