surely p2peer is just that. If I have $100 and you want to borrow $100 I lend to you. I get a rate of return on this and the p2peer company take a cut on that rate for being the middle-man. They don't act as guarantor, if you fail to repay the $100 I loose out (and they loose their cut of the interest).

When you "lend on" money you yourself borrowed in peer2peer lending at this point you cede access to that money. Unlike when you save with a bank where your money is lent out (except the 10% reserve) yet you have a demand deposit for the full amount. Hence the multiplier effect.

I think your description above is totally wrong. Banks in the UK had leverage at over 20 times assets to capital. It was precisely this high level of gearing which meant that our banks collapsed very quickly when there was a shift in the economy.

Banks lend most of the money out back out based on the probability that most loans won't default. Your 1+2 isn't correct.