I love the idea behind prosper and would love to loan money to others to help them out. The problem? Like most people I don't have a lot of money to invest, what I do save is for emergencies and needs to be as liquid as possible (i.e. in a checking or savings account) and can't be tied up in investments. The little bit I do have for investing ends up in a traditional IRA so I can take the tax deductions. If there is anyway Prosper could set up IRA lending accounts so tax deductible money can be used for loans maybe it would attract a lot more smaller lenders.

Not to mention the earnings could grow tax defered (traditional IRA) or tax free (roth IRA) if they are left in the lending account or rolled over to another IRA.

I'd be very interested in an IRA option - given the current tax environment for interest income (punitive), being able to earn interest in a tax-deferred account would be a big win - also, there are a lot of people with money in 401(k) and IRA accounts that would like to put it to use, and a micro-lending IRA vehicle would be a wonderful option.

If you don't know where to start with this, I'd talk to the guys at Pensco <http://www.pensco.com> - they are a flexible self-directed IRA trustee company.