Since the Federal Reserve hiked rates in December, Lending Club has raised its own rates twice — it made an announcement shortly before Christmas about an equivalent 25bps hike and then followed up with a bigger move in January, which Tracy Alloway spotted over at Bloomberg.

The company hasn’t stopped there. Last week it hiked the interest rate charged to its riskiest borrowers, pushing rates up by an average of 250bps relative to January, according to an investor presentation seen by FT Alphaville.

The hike on February 19 affects Lending Club’s “near-prime program” loans, which have FICO scores from 660 to 600 and are sold only to institutional investors. Rates on those loans are now 340bps higher than in December, according to the presentation, with interest rates ranging between 19.99 per cent and 31.89 per cent.

Renaud Laplanche, Lending Club’s chief executive, declined to comment on the hike on near-prime loans. But he did say in an email that Lending Club’s previously reported rate increases were a “precautionary measure … to provide investors with additional ‘loss coverage’ in case the U.S. economy does indeed slow down”.

According to the Lending Club presentation, which shows data up to Q3 of 2015, “loss rates are tracking to forecast” with the exception of a batch of loans originated in Q3 2013.

Rival Prosper Marketplace has also increased rates on its loans recently, saying that the moves reflected negative investor sentiment in the broader market. “We have to adjust to make sure the product is attractive,” said Prosper’s chief risk officer, Josh Tonderys.

The more bearish interpretation, which we discussed earlier this week, is that the moves are related to an uptick in delinquencies in the second half of 2015, particularly on the risker end of the credit spectrum.

We’ll have more on that soon, but in the meantime it’s clear marketplace lenders are having to push the boat out a little more to keep investors interested in their loans.

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