LendingClub to cut 225 jobs as interest rate rises impact loan demand
Digital lending platform LendingClub is to lay off 225 employees – 14% of its headcount – citing the detrimental impact of recent interest rate hikes on the demand for loans.
LendingClub to cut 225 jobs
LendingClub is due to publish its Q4 results later this month, with Reuters reporting the company expects revenue to be between $260 million and $263 million and a net income between $21 million and $24 million for Q4.
In a statement, company executives said the layoffs are a result of “reduced marketplace revenue following the Federal Reserve’s historic pace of interest-rate increases”.
The company anticipates the job cuts will generate savings somewhere in the region of $25 million to $30 million this year, Reuters reports.
In October, LendingClub executives said they expected “more tempered loan volumes and marketplace revenue” in H2 2022 after the Federal Reserve hiked interest rates in a bid to drive down inflation.
The San Francisco firm, which offers low-cost loans, joins a long list of fintech firms that have cut jobs over the past year in the face of a looming global recession, with Crypto.com, Till Payments and Clearco among the latest to slash jobs.
In a statement, LendingClub CEO Scott Sanborn says: “It’s never easy to part with people who are not just outstanding contributors but also teammates and friends.
“We are working to help all our impacted teammates transition. We are providing bonus / incentive pay, making accommodations for foreign nationals on employment visas, providing ongoing support, and more.”
