Prosper's Poor Collections

It has been an axiom that Prosper's collections need some, shall we say, improvement. I think it's important to back up this axiom with some hard data. Fortunately, Prosper provides some useful statistics for analyzing their default rate.

The easy answer is to look at their collection agency statistics. I'm only going to look at Penncro's collection information as they handle a large majority of the collections for Prosper (~97%).

	Current	Past 12 months	Lifetime
Amount sent to agency:	$1,015,661.09	$1,877,692.45	$1,881,095.05
Amount collected: Gross Net after agency fees	5.27% 4.64%	12.54% 11%	12.67% 11.11%
Accounts sent to agency:	1229	2265	2276
Accounts brought current: In 1st mo. at agency In mo. 2 In mo. 3 In mos. 4+	n/a	13.25% 8.74% 2.43% 1.32% 0.75%	13.58% 9.05% 2.46% 1.32% 0.75%

The number of interest is that Penncro has brought about 13.25% of referred accounts current in the last 12 months. That's rather depressing. This implies that if a loan goes 1 month late and makes it to the collection agency, the odds are exceedingly high (86%) that it's gone.

The new VP of Operations was brought in to help clean up collections. Hopefully he'll have an affect.