It's alternative lending week at The Wall Street Journal. First on Wednesday, Jane Kim profiles person-to-person lenders Prosper and Lending Club (here). Supporting market forecasts came from our earlier work at Online Banking Report (see Online Banking Report #127, and note 1, 2). 

Today, Anne Marie Chaker looked at Web-based student loan marketplaces (here). Each market works differently, but the basic approach is to get detailed info from the prospective borrower, then provide the borrower with a variety of specific loan options from specific lenders. In the case of College Loan Market and Student Loan Scout, a full application, including credit check, is required. But that allows participating lenders to offer firm financing quotes, similar to LendingTree's approach in the broader loan market. Apparently, this student loan sector is seeing increased activity, and scrutiny, due to the recent conflict-of-interest scandals at a number of college financial aid departments. 

Here are the links to the student lending specialists named in the article:

• College Loan Market <collegeloanmarket.com>
• eStudent Loan <estudentloan.com>
• Insight by Graduate Leverage <graduateleverage.com>
• Simple Tuition <simpletuition.com>
• Student Loan Scout <studentloanscout.com> **Not yet open for business**

Of the five, only eStudentLoan has an inviting appearance, with big orange "Web 2.0" students and parents buttons and the all-imporant name-dropping of its lenders along the bottom (see screenshot below).

Notes:

1. Our original forecast was published in OBR #127 in March 2006; the model was updated and the forecast increased by about 5% in November 2006. The updated numbers were cited in the Wall Street Journal article. We are increasingly bullish on the space and will publish updated forecasts this fall.

2. Also mentioned in the WSJ article: CircleLending, Loanio, and Zopa.