giffgaff claims to be “the network run by you”, so perhaps it shouldn’t be quite so surprised when the online community objects to what was a mobile phone company suddenly deciding it’s a bank.

The “run by you” bit means that the company worries a lot about what customers say in the forums. And what the “owners” are saying is that they don’t like it. One contributor says “giffgaff [are] selling their soul”, while others are questioning how the model where “owners” get commission on getting others to sign up for a giffgaff phone will translate to siging up for a giffgaff loan. giffgaff did originally propose a “payback” scheme, but this was shouted down and the plans to do that now seem to have been nixed.

The mechanism by which the loan works is that it’s through a company called RateSetter, which co-ordinates peer-to-peer lending. In its FAQ, giffgaff says:

Is giffgaff money a niche product within the financial sector?: The financial services market is still dominated by the big banks, but there have been new entrants. The supermarkets have launched banks to compete and the growth of peer-to-peer lending has provided an alternative opportunity for investors to gain better returns and lower borrowing rates. giffgaff believes that by working with RateSetter to promote a fairer, more transparent way of borrowing that we can help grow this sector of the market. At the moment, it is fair to say that it is a niche sector, but one that is growing fast.”

Which hints at ambitions to be a big lender.

The scheme allows people over 21 to borrow sums of between £750 and £7,500 for up to five years. There are light credit checks and the rate depends on the person doing the borrowing. It’s grown out of a system of loans for buying a handset. giffgaff will allow customers to take out a loan, using RateSetter to buy the handset with the mobile deal being SIM only.

Despite the forum malcontents, a spokesperson for giffgaff told El Reg that the move into moneylending followed consultation both online and offline, adding that giffgaff was “all about the individual”.

Of course, giffgaff isn’t truly run by you: it’s 100 per cent owned by O2, which for the moment is owned by Telefonica. It remains to be seen what Three will do with giffgaff when it acquires O2.

RateSetter and giffgaff are clearly well matched to one another. One has a capital too many and one has a capital too few. giffgaff money is due to launch in a couple of weeks. ®