I was in bitlendingclub before they folded and lost about 3 of 5 total bitcoin before I pulled out. The vast majority of borrowers actually did pay off their loans, but it only takes a few to wipe out your profit on tens or hundreds of loans(assuming you are trying to be smart and do tons of microloans.)

Another big issue is that when someone defaults, how do you go after them? If they are in your country and your country has a decent legal system you could try and get a lien put on them if they won't pay and pray that you eventually get your money back. However, how do you think you are going to get your money back from borrowers in second or third world countries? You're not!

It is a tough problem to crack and if anyone ever does figure it out they will become filthy rich. I just don't see anyone who has the solution yet.