Mary Meeker is at it (again)
News Comments Today’s main news: Online lenders tighten rules against default wave. UK P2P lenders join effort to overturn Brexit. Consumer credit sees the most financial complaints in UK. Today’s main analysis: Where is the most student debt? Today’s thought-provoking articles: How regulations will impact Ant Financial. The 7 most innovative fintech companies. Where is the fintech innovation right […]
- Today’s main news: Online lenders tighten rules against default wave. UK P2P lenders join effort to overturn Brexit. Consumer credit sees the most financial complaints in UK.
- Today’s main analysis: Where is the most student debt?
- Today’s thought-provoking articles: How regulations will impact Ant Financial. The 7 most innovative fintech companies. Where is the fintech innovation right now? What fintech investors want in Africa. About Canada’s P2P lenders.
- Online lenders tighten the rules against default wave. The market waxes and wanes. When defaults go up, it’s time to tighten the standard. They can be loosened again when lenders have confidence in borrowers’ ability to pay.
- Where is the most student debt? Another LendingTree study. Washington D.C. is No. 1. Really?
- Wells Fargo to get into auto lending again.
- Principal Financial acquires RobustWealth.
- Instead of lending money to family, try this. A video worth looking at.
- OppLoans named one of the best workplaces in the country by Inc. Magazine.
- Lendbuzz gets $30 million.
- Fifth Third Bank eBus offers financial advice for free.
- PLI 23rd Annual Consumer Financial Services Institute.
- P2P lenders join effort to overturn Brexit. It will be interesting to see if they make any headway.
- Consumer credit gets the most financial complaints.
- Investing in property without buying a home.
- Will FCA squelch robo-advice?
- P2P lenders join speaking team at Future of Fintech.
- How will regulations impact Ant Financial?
- GXChain to use blockchain for commercialized data marketplace.
- Australia: Banks’ $220 million bill for bad financial advice to rise.
- Australia: 52% of home buyers open to buying partially renovated property.
- India: ICICI wants to build its own tech stack.
- Malaysia: Funding Societies partners with United Overseas Bank.
- Vietnam: Fintechs need bank support.
- Japan: Gumi founder launches crypto fund.
- Africa: What fintech investors are looking for.
- Kenya: Country wants to regulate fintech lenders.
- Canada: P2P lenders will help SMBs stay afloat.
- Canada: Fintech Select ends Q1 with net profit.
- United States
- Online lenders tighten rules as default wave rattles investors (American Banker) Rated: AAA
- LendingTree Study: Which Places Have the Most Student Debt? (PR Newswire) Rated: AAA
- Wells Fargo Plans to Expand Auto Lending Again (Lend EDU) Rated: A
- Principal Financial acquires digital advice startup RobustWealth (Investment News) Rated: A
- What to Do When You Lend Family Money But They Can’t Pay You Back (Entrepreneur) Rated: A
- OppLoans Named One of the Country’s Best Workplaces by Inc. Magazine (Markets Insider) Rated: A
- Autoloans Company Lendbuzz Secures $ 30 Million in Funding (CTech) Rated: A
- Fifth Third Bank eBus offers free financial advice (The Blade) Rated: B
- PLI 23rd Annual Consumer Financial Services Institute (JD Supra) Rated: B
- United Kingdom
- Tech Entrepreneurs Launch Campaign to Reverse Brexit Vote (Forbes) Rated: AAA
- Consumer credit made up the bulk of financial complaints last year (Peer2Peer Finance) Rated: AAA
- How to invest in property without buying a home (City A.M.) Rated: A
- Robo-rumble: Will FCA scrutiny stop digital services moving further towards advice? (Money Marketing) Rated: A
- FIVE SPEAKERS JOIN ‘FUTURE OF FINTECH’ EVENT LINE-UP (Business Cloud) Rated: B
- How Will Ant Financial, China’s Fintech Giant, Be Impacted By New Regulations? (Forbes) Rated: AAA
- GXChain (GXS) Review – A Blockchain-based Commercialized Data Marketplace (Chain Bits) Rated: A
- 7 most innovative Fintech companies right now (Forex News Now) Rated: AAA
- Where In the World Is Fintech Innovation? (Bank Innovations) Rated: AAA
- Banks’ $ 220m bill for dudding customers to rise ‘significantly’ (The Canberra Times) Rated: A
- What you should look for when buying a partially renovated house (Domain) Rated: A
- ICICI Bank also wants to be a fintech (The Ken) Rated: A
- Funding Societies partners with UOB Malaysia to accelerate small business growth (Deal Street Asia) Rated: AAA
- Fintech firms need support from banks: SBV (Vietnam News) Rated: A
- Japan’s Gumi Games Founder Launches $ 30M Crypto Fund (Blockchain News) Rated: A
- Fintech in Africa: what investors are looking for (Fin24) Rated: AAA
- Kenya calls for regulation of fintech lenders (IT Web) Rated: A
- Peer-to-peer lending will help small businesses stay afloat (The Globe and Mail) Rated: AAA
- Fintech Select Records a Net Profit of $ 986k for Q1 Ending March 31 2018 (GlobeNewswire) Rated: A
Online lenders tighten rules as default wave rattles investors (American Banker) Rated: AAA
It’s gotten a lot harder to borrow money from the raft of fintech firms looking to bring online lending into the mainstream.
Besieged by a wave of defaults after several years of rapid growth, the biggest online lenders have been forced by bond investors to tighten underwriting standards. Social Finance, Prosper, LendingClub and Avant now demand higher average credit scores and offer shorter maturities to boost the quality of loans they repackage into asset-backed securities.
The shift in the $30 billion market comes after a swarm of borrower defaults in the past three years rattled ABS investors. It also marks a coming of age of sorts for the fintech startups that offered cut-rate loans to build a customer base. Now, with rates rising and a potential economic slowdown looming, the move toward higher-quality from the push for quantity has taken on added urgency.
According to Kroll, the weighted average of FICO credit scores of Prosper’s loans packaged in ABS increased to 717 in a March 2018 deal from 704 in a sale two years earlier.
LendingTree Study: Which Places Have the Most Student Debt? (PR Newswire) Rated: AAA
LendingTree today released its study on the places with the most student debt. To determine whether there are geographic variations in student debt, LendingTree analysts looked at a sample of anonymized users who logged into My LendingTree in the first quarter of 2018 and calculated how many had student loans, as well as the other reported statistics related to their balances.
Wells Fargo Plans to Expand Auto Lending Again (Lend EDU) Rated: A
Wells Fargo & Co. expects to increase its auto lending again. In mid-2017, Wells Fargo decided to reduce car financing and tighten its underwriting standards. In February 2018, the firm said it intended to finish consolidating its regional car loan centers by April, and that lending would expand within two quarters, reported Bloomberg.
For lenders in a $1.2 trillion U.S. auto loan market, they face a landscape with falling vehicle resale prices, making it difficult for them to soften losses from repossessing cars when borrowers default.
Principal Financial acquires digital advice startup RobustWealth (Investment News) Rated: A
Principal Financial Group is acquiring financial technology startup RobustWealth to improve its own technology offering and expand distribution capabilities among the banking, broker-dealer and registered investment adviser channels.
Principal also sees the RobustWealth’s platform — which includes digital advice, goal-based investment tools and client onboarding — as providing the foundation for a direct-to-consumer robo-adviser in the future.
What to Do When You Lend Family Money But They Can’t Pay You Back (Entrepreneur) Rated: A
Like many people, Entrepreneur Network partner Jeff Rose once has convinced himself it was a good idea to loan money to a family member. In reality, the situation can get messy when this close personal connection cannot return the investment. This does not mean Rose has given up on peer-to-peer lending, which is a helpful tool that can streamline the loan process.
OppLoans Named One of the Country’s Best Workplaces by Inc. Magazine (Markets Insider) Rated: A
Online lender and service provider OppLoans has been listed as one of the country’s 2018 Best Workplaces by Inc. Magazine. The award determination was based on employee survey results in areas like benefits, perks, executive leadership and opportunities for career development.
OppLoans enjoys a rating of 4.9 out of 5 stars on Glassdoor as well as a 98 percent retention rate and 99 percent approval rating for CEO Jared Kaplan. Last December, Glassdoor rated the Chicago-based startup as the sixth-best place to work nationally for small-to medium-sized businesses. The firm was named #219 on the 2017 Inc. 500 list of fastest-growing companies and the third-fastest growing technology company in Chicago by Built in Chicago.
Autoloans Company Lendbuzz Secures $ 30 Million in Funding (CTech) Rated: A
Boston-headquartered car financing service Lendbuzz Funding LLC has raised $30 million in financing, the company announced Tuesday. The round was led by BHI, the U.S. division of Israel-based Bank Hapoalim, by Viola credit, the growth and venture lending arm of Israel-based Viola Group, and by U.S.-based ConnectOne Bank.
The company, which currently offers its services in most U.S. states, says it reviews loan requests within 24 hours and transfers money immediately upon approval. Since its establishment, the company raised $43 million in both debt and equity funding.
Fifth Third Bank eBus offers free financial advice (The Blade) Rated: B
For the next week, a large bus operated by Fifth Third Bank will travel throughout Toledo, offering residents free money management advice and job-searching services.
The bus, called the Fifth Third Bank Financial Empowerment Mobile, or eBus, was located at the Lucas Metropolitan Housing Authority on Wednesday, and though it’s operated by Fifth Third, its services can be used by any residents no matter which bank they use, said Loretta Humphrey-Cruz, community development relationship manager.
PLI 23rd Annual Consumer Financial Services Institute (JD Supra) Rated: B
The third location of PLI’s 23rd Annual Consumer Financial Services Institute will take place in PLI’s San Francisco Conference facility and via concurrent live Webcast on June 25-26, 2018. This will be the first time in many years that the Institute will take place in San Francisco. Since the first location of this event in NYC on March 26-27 was well-attended, and the second location in Chicago on May 7-8 was sold-out, anyone interested in attending the program in San Francisco is encouraged to act quickly to register.
Tech Entrepreneurs Launch Campaign to Reverse Brexit Vote (Forbes) Rated: AAA
Could Britain’s leading technology entrepreneurs derail Brexit? More than 80 innovators and investors from across the UK’s tech sector have launched a new group, Tech for UK, which will campaign for a meaningful vote on the final terms of the Brexit agreement that the British Government is currently negotiating with the European Union. Such a vote should give Britons the option to vote for the UK to remain in the EU, Tech for UK argues.
The group boasts a string of high-profile business leaders from the tech sector, including Martha Lane-Fox, best-known as the co-founder of Lastminute.com, Giles Andrews, one of the founders of peer-to-peer lending pioneer Zopa, and George Bevis, the CEO of Tide Bank. It also features leading venture capital and private equity investors, such as Simon Murdoch, the managing partner of Episode 1 Ventures.
Consumer credit made up the bulk of financial complaints last year (Peer2Peer Finance) Rated: AAA
The FOS annual report for 2017/2018 found consumer credit products, which includes some peer-to-peer lending as well as payment protection insurance, accounted for the most complaints at 36,349 last year, up 40 per cent.
The Ombudsman upheld 47 per cent of complaints, up from 45 per cent a year before.
There was also an eight per cent increase in complaints about unsecured loans to 6,909, while credit card complaints were up 15 per cent to 11,073.
How to invest in property without buying a home (City A.M.) Rated: A
Over the past few years, property-oriented investment companies have been coming in thick and fast, bolstered partly by the launch of the Innovative Finance Isa (IFISA).
The minimum investment can be as little as £10, which isn’t a patch on the huge deposits needed to buy a house (the average deposit in London is more than £90,000).
Robo-rumble: Will FCA scrutiny stop digital services moving further towards advice? (Money Marketing) Rated: A
The FCA reviewed seven firms offering online discretionary investment management services and three firms giving automated advice.
It found service and fee-related disclosures at most online discretionary investment management firms in its sample were unclear.
Some firms did not make clear whether their service was advised, non-advised, discretionary or non-discretionary. Others also compared their fee levels with their peers in a “potentially misleading way”. For example, they compared a non-advised, non-discretionary service with a discretionary service solely on a cost basis without explaining the difference in the nature of the service.
FIVE SPEAKERS JOIN ‘FUTURE OF FINTECH’ EVENT LINE-UP (Business Cloud) Rated: B
Five speakers from the world of FinTech have been confirmed for BusinessCloud’s The Future of FinTech event in London on 12 July.
Nicola Horlick, a former investment banker turned high-profile player in the peer-to-peer (P2P) lending market, is the headline speaker for the breakfast event.
How Will Ant Financial, China’s Fintech Giant, Be Impacted By New Regulations? (Forbes) Rated: AAA
GXChain (GXS) Review – A Blockchain-based Commercialized Data Marketplace (Chain Bits) Rated: A
With the proliferation of data on the internet, there are many pain points for individuals. Since you do not own your data, someone can sell you information and personal data without sharing profits. In addition, data is often scattered among multiple platforms, making it difficult to manage. Finally, data is difficult, if not impossible, for individuals seeks to monetize and earn from it. They don’t know how the blockchain could be applied in this scenario to better their lives.
GXChain solves these pain points by obtaining user consent before collecting and storing user data on a blockchain.
GXChain wants to be the data trading network that protects user privacy and offers copyright protection and usability at the same time. It has real-world applications in insurance, online lending, consumer loans and banks.
7 most innovative Fintech companies right now (Forex News Now) Rated: AAA
Stripe-is one of the most valuable Fintech startups. It was worth over $9 billion in 2016.
Ant Financial-has a market capitalization of $60 billion, which makes it the most valuable Fintech company in the world.
Atom Bank-has raised over $290 million in financing.
Robinhood-Valued at $5.6 billion, offers its customers a mobile wallet that allows trading shares and exchange-traded funds without paying commissions.
Lufax-is an online peer-to-peer lending platform. It matches borrowers with investors for a fee of 4% and is valued at over $18.5 million.
SoFi-is valued at over $4.4 billion.
Coinbase-has over 13 million users and makes more than $1 billion in revenue a year.
Where In the World Is Fintech Innovation? (Bank Innovations) Rated: AAA
China is also at the forefront of innovation. The government is actively cultivating fintech there.
Fintech companies like Qudian, LuFax, and ZhongAn (owned by Ant Financial), China’s first online-only insurer, are now emerging. Investment bank CLSA ranks ZhongAn as the sixth most valuable e-finance company in the world. The Chinese government has also designated development zones, such as Zhongguancun and Shenzhen, for innovation industries.
Banks’ $ 220m bill for dudding customers to rise ‘significantly’ (The Canberra Times) Rated: A
Banks are set to refund “significantly” more than the $220 million already set aside for financial advice clients who were charged for services that were never provided, as institutions search their files for customers who were ripped off.
What you should look for when buying a partially renovated house (Domain) Rated: A
A recent survey by online lender State Custodians found 52 per cent of people would be open to a renovation project for their next purchase but only 19 per cent of people would be keen on tackling a full fixer-upper.
On the other hand, a quarter of respondents would prefer taking on a partially renovated home as a project, with Millennials in particular more open to the idea of buying a half-renovated house.
ICICI Bank also wants to be a fintech (The Ken) Rated: A
In mid-2017, B Madhivanan, the chief technology and digital officer of ICICI Bank, met Rohan Angrish, the chief technology officer of online lender Capital Float. Madhivanan had questions about online lenders’ small-ticket loans. Fintechs like Capital Float lend to underserved segments like kirana stores that banks don’t normally touch.
Funding Societies partners with UOB Malaysia to accelerate small business growth (Deal Street Asia) Rated: AAA
United Overseas Bank (Malaysia) Bhd has partnered with regional peer-to-peer financing platform Modalku Ventures Sdn Bhd (Funding Societies) to connect startups and small businesses with alternative financing solutions.
Through the partnership, startups and UOB Malaysia’s small business customers will be able to raise up to RM500,000 directly from individual and institutional investors using Funding Societies’ platform without the need to pledge collateral.
Fintech firms need support from banks: SBV (Vietnam News) Rated: A
The fintech (financial technology) sector is facing difficulties of capital mobilisation shortage, inadequate legal framework and banks’ hesitance in co-operation, said Lê Minh Hưng, Governor of State Bank of Việt Nam (SBV).
Hưng told the Việt Nam fintech forum 2018 held in Hà Nội on Wednesday that fintech and banks could contribute to expand financial universalisation, and promoting hunger eradication and poverty reduction while enhancing social equality and sustainable economic development.
Japan’s Gumi Games Founder Launches $ 30M Crypto Fund (Blockchain News) Rated: A
Japanese mobile games publisher gumi today launches a fund to invest in promising global cryptocurrency companies. With USD 30 million in initial investment secured, the venture capital fund is moving to open up the Japanese crypto startup market to international investors, honing in on a target that has, up to now, been a struggle to access and understand.
While the Japanese yen accounts for over 56 percent of Bitcoin volume, gumi believes that there is lack of understanding of Japan’s crypto market and the project’s leaders are keen to fill a void in the country that was also the first to legalize bitcoin.
He has helped to raise over USD 250 million to date for companies such as Bee Token, the Decentralized AirBnB and crypto lending platform Celsius Network.
Fintech in Africa: what investors are looking for (Fin24) Rated: AAA
According to EcoBank, more than 57% of all mobile money accounts globally can be found in sub-Saharan Africa, with the African fintech market set to grow from $200m currently to $3bn by 2020.
A recent study by McKinsey found room for growth in meeting unmet banking needs in Africa. These include borrowing, saving, and investing across the continent. South Africa alone is set to see an increase in banking revenues of $4bn over the next five years.
Kenya calls for regulation of fintech lenders (IT Web) Rated: A
A boom in lending by fintech firms in Kenya has led to an increase in predatory lending practices, the country’s central bank governor said yesterday, calling for the sector to be regulated.
Kenya built a reputation as a pioneer of financial inclusion through its early adoption of a mobile money system that enables people to transfer cash and make payments on cellphones without a bank account.
Peer-to-peer lending will help small businesses stay afloat (The Globe and Mail) Rated: AAA
One set of borrowers at greater risk are Canada’s 1.14 million small businesses, defined as companies that employ up to 99 workers. Statistics Canada reports that small businesses represented 98 per cent of all businesses, employed 70 per cent of workers, and generated 30 per cent of each province’s GDP on average. This category includes startups and high-growth firms, which represent Canada’s best hope for job creation and economic growth.
Fortunately, small businesses now have an alternative source for loans called peer-to-peer (P2P) lending. These online platforms match borrowers and investors directly and can provide loans cheaper and faster than traditional sources. How can that be? The answer is technology.
Fintech Select Records a Net Profit of $ 986k for Q1 Ending March 31 2018 (GlobeNewswire) Rated: A
Fintech Select Ltd. is pleased to announce that its financial statements for the Q1 ending March 31 2018 have resulted in a net profit of $986k. Q1 2018 Financial Statements and Management Discussion & Analysis (“MD&A”) have been filed on SEDAR.
By the very definition of FinTech, online lenders have been using technology to transform financial services. In the early days, this equated to moving the mountains of paperwork into digital forms and automating manual processes. Rather than optimizing transactions and speeding approvals, the same inefficient processes were often recreated. The same documents were required — […]
By the very definition of FinTech, online lenders have been using technology to transform financial services. In the early days, this equated to moving the mountains of paperwork into digital forms and automating manual processes.
Rather than optimizing transactions and speeding approvals, the same inefficient processes were often recreated. The same documents were required — now in a PDF format rather than paper. In fact, some lenders made the mistake of modernizing the front-end customer experience but didn’t link their digitization efforts to the back office.
User-Focused Design and Branding
What’s changed? Now, consumers are demanding more security, privacy and personalization from their banks and financial service providers. Online lenders and financial institutions must upgrade their user experience by speeding transactions, providing personalized pricing and integrating data sources to reduce documentation requirements.
A recent article in The Financial Brand magazine says consumer lending is entering a new era of digitization. The PwC Consumer Finance Practice team identified key trends that will drive the next era of innovation in digital lending:
- Evolving end-to-end workflows and processes
This long-running trend to simplify and streamline the often arduous loan approval process is now including new data sources. Financial institutions are re-thinking the requirements to originate a loan and reworking their customer experience and internal workflow to deliver a frictionless lending experience.
- Friendly Financial Advice Delivered Digitally
Borrowers value personal advice and often require 24/7 access to answers. Fortunately, digital tools are becoming more acceptable with the flexibility of self-service and collaborative models to deliver information quickly and efficiently.
The next generation of digital lending will engage consumers in new ways, such as digitally-augmented human support, voice interaction, AI-powered virtual assistants and chatbots, wearables, and augmented and virtual reality.
Since online-only lenders don’t have storefronts to develop in-person relationships, clear communications are critical for building trust. Opportunities to better serve online customers include:
- Discrete Research and Application Process
Plain Green Loans recently conducted another round of focus groups with customers and received feedback about the need for protecting their privacy. As a provider of short-term loans to consumers during emergencies, Plain Green’s customers require discretion as they research loan options online. Customers also expressed appreciation for a simplified and streamlined loan approval process. The consumers seeking emergency loans are on tight deadlines and need immediate responses to determine next actions. A fast review of applications and loan approvals are imperative to these consumers. In fact, a recent PwC survey of more than 1,600 adults with full-time employment found that 46 percent of those in the study – which typically has more stable finances than other groups – stated that financial challenges are the number one source of stress in their lives. The study concluded that lenders have tremendous opportunities to assist consumers in understanding their financial options and help them choose the best solution based on their personal situation.
- Building Consumer Confidence
Feedback from the Plain Green customer focus groups emphasized the need for authenticity, being real and believable.Creative Bloq’s list of big branding trends in 2018 cited the recent massive data breaches and natural disasters occurring one after the other as the reason consumers want extra assurance from brands that they will provide security. They say, “consumers are looking for clues to determine whether a brand can be trusted, from the overall design quality and experiential thoughtfulness, to ratings and feedback on social media. Brands have to view all of their activities through the lens of a skittish public and a tumultuous world; particularly online.”Online reviews were a major topic of discussion during the focus groups. Several customers said they don’t believe the reviews on websites because the testimonials are all positive or have high ratings. Instead, they preferred to research customer feedback on their own using Yelp, Google or other platforms to give them a broader understanding of experiences the general population may have encountered.
- Brand Images Reflecting Diversity
Focus group participants expressed a desire for more diversity in branding images. They want real people shown on websites and in communications that reflect wider demographic groups.Customers stated that they distrust images of people looking too happy, too sad or with fake, over the top emotions. Especially when making a financial decision, the customers want to see people with expressions that underscore the serious nature of the transaction.The focus groups provided meaningful insights that will inform our customer care team, website development, and acquisition and loyalty programs.
It’s clear that online lenders and other financial services providers must continuously seek customers’ feedback to align product development and business strategies to customers’ needs.
With more than 12 years of experience designing groundbreaking marketing strategies for Fortune 500 companies and financial technology brands, Guy Dilger, Guy Dilger, VP of Marketing, Plain Green, LLC, is known for generating engaging content and compelling concepts that resonate with targeted consumers. Prior to Plain Green, Dilger held senior positions within fintech and retail spaces where he managed national marketing campaigns and customer-centric loyalty initiatives for Sears and Kmart. Previously, he was part of the management team at Limited Brands, where his marketing work in support of Express brand included CRM, email, web-based programs and the redesign and relaunch of a private label credit card. Dilger has an MBA, as well as a bachelor of science in economics, from Southern Methodist University.
Money-can-buy coverage; “Einhorn should short Einhorn”; why Italy needs a Quitaly plan; the creepy rise of firms spawning fictional design; and more.
A tale of FX rates and CPI.
News Comments Today’s main news: GreenSky sets shares at $23 each, sold 38M. Elevate Credit doubles floor space. Tandem hits 100K clients. Lidya raises $6.9M in Africa. Today’s main analysis: PeerIQ recounts TransUnion Summit 2018. Today’s thought-provoking articles: An orthodontist racks up over $1M in student loans. CompareCards releases credit card fee report. The worst is over for Chinese microlenders. […]
- Today’s main news: GreenSky sets shares at $23 each, sold 38M. Elevate Credit doubles floor space. Tandem hits 100K clients. Lidya raises $6.9M in Africa.
- Today’s main analysis: PeerIQ recounts TransUnion Summit 2018.
- Today’s thought-provoking articles: An orthodontist racks up over $1M in student loans. CompareCards releases credit card fee report. The worst is over for Chinese microlenders.
- GreenSky raises over $800 million. Notable is the price of each share at $23 and the number sold at 38 million. Nice round. Congratulations.
- Elevate Credit doubles floor space in Addison, Texas. This represents significant growth.
- Dodd-Frank reform leads to VantageScore win. PeerIQ recaps Dodd-Frank reforms and the TransUnion Summit 2018, which includes some interesting reports on delinquencies and refinancings.
- One orthodontist racks up over $1 million in student loans. I didn’t see a mention of any specific lenders, but it seems “easy credit” is taking the blame for this. Still, an interesting read.
- CompareCards releases credit card fee report. An interesting look at which types of credit cards have the highest fees.
- Silver Hill Funding targets the underserved in small business lending.
- Affirm adds another San Francisco office.
- Kabbage tells small businesses when to expand.
- Are algorithmic advisors better than traditional financial advisors?
- Are we in the golden age of Fintech? Ron Suber thinks so. Great TV interview.
- Can a side gig fund retirement?
- RBC Wealth Management launches digital alternative investments platform.
- Alabama targets a crypto lender.
- 69% of millennials aren’t saving for retirement.
- Tandem reaches 100,000 clients. Awesome. Congratulations.
- SMEs are neglected opportunity for big banks. A huge opportunity for alternative lenders.
- Why scaleups shy away from debt, equity growth funding.
- Department store numbers fall by quarter.
- United States
- Fintech GreenSky raises more than US$ 800mln in its IPO (Proactive Investors) Rated: AAA
- Elevate Credit doubles space with ‘super floor’ in Addison office building (Dallas Business Journal) Rated: AAA
- VantageScore win, TransUnion Summit 2018 (PeerIQ), Rated: AAA
- Mike Meru Has $ 1 Million in Student Loans. How Did That Happen? (WSJ), Rated: AAA
- Silver Hill Funding’s Leslie Smith is Targeting the Underserved in the SBL Space (Commercial Observer) Rated: A
- Fintech adds another S.F. office (San Fransciso Business Journal) Rated: A
- Does Your Business Need More Space? A Lender Weighs In On Why And How To Expand (Forbes) Rated: A
- For Your Money, Which is Better: The Algorithm or the Adviser? (Kiplinger) Rated: A
- Are we in the Golden Age of Fintech? (Fintech TV), Rated: A
- Can your side gig fund retirement? (CU Insight) Rated: A
- CompareCards Releases 2018 Credit Card Fee Report (PR Newswire) Rated: AAA
- RBC Wealth Management – U.S. launches new digital alternative investments platform (PR Newswire) Rated: B
- Five Firms Hit by ‘Crypto-Sweep’ in Alabama as Regulators Step up Operation (Bitcoin News) Rated: B
- 5 Ways to Get ‘Free’ Money From Your Employer Without a Raise (Student Loan Hero) Rated: B
- United Kingdom
- Tandem reaches 100,000 clients, signs for Form3 paytech (Banking Tech), Rated: AAA
- SMEs: a neglected opportunity for UK big banks (SME Magazine) Rated: AAA
- Why scaleups still shy away from debt and equity growth funding (Real Business) Rated: A
- Department store numbers fall by quarter (Drapers) Rated: B
- Worst Is Past for Microlenders — Analysts (Caixin Global) Rated: AAA
- Credible Lab CEO Stephen Dash likens ASX to ‘junior Nasdaq’ (Australian Financial Review) Rated: A
- How the Fintech Industry is Drawing Young Talent in the Country (Entrepreneur) Rated: AAA
- Acko Gets $ 12 mn funding from Amazon, others (Elets Online) Rate: A
- Singapore Has Fintech Dreams, But It’s Short on Tech Talent (Bloomberg) Rated: A
- Lidya Scores $ 6.9 Million in Series A Investment (Finovate), Rated: AAA
Fintech GreenSky raises more than US$ 800mln in its IPO (Proactive Investors) Rated: AAA
The online lender priced its shares at US$23 each, raising a total of US$874mln in its first day of trading. The company sold 38 million shares, surpassing its expectation of 34 million shares.
Elevate Credit doubles space with ‘super floor’ in Addison office building (Dallas Business Journal) Rated: AAA
Elevate Credit Inc. will expand at Spectrum Center in Addison, doubling both the size of its footprint and the capacity for employees who can work in the office.
The fast-growing company is growing from 26,000 to 52,000 square feet in the 614,000-square-foot office complex.
VantageScore win, TransUnion Summit 2018 (PeerIQ), Rated: AAA
The House passed the Economic Growth, Regulatory Relief, and Consumer Protection Act which reforms the Dodd-Frank Act and provides significant oversight relief to small banks. Below are some of the main provisions of this bill:
- One of the most notable shifts lost in the headlines is that the legislation requires Fannie Mae and Freddie Mac to evaluate and consider alternative credit scores to FICO. The change introduces competition to the credit scoring market and is a big win for VantageScore.
- Regulatory Capital relief:
- The threshold for a Systematically Important Financial Institution has been raised to $250 Bn in assets from $50 Bn, which will exempt a number of regional banks. These banks will no longer be subject to onerous CCAR tests and reduce their compliance burdens. Banks with less than $10 Bn in assets are also exempt from the Volcker Rule – a win for Jeb Hensarling’s (R-TX) campaign to provide relief for community banks.
- Banks with less than $3 Bn in assets will have a lower frequency of regulatory exams, banks with less than $5 Bn in assets will have fewer reporting and compliance requirements, and all banks with less than $10 Bn in assets will have the same capital ratio.
- Lenders can now charge subprime borrowers higher rates for auto loans.
TransUnion Financial Services Summit 2018
Delinquencies in auto loans have picked up recently to 4.3%, with subprime auto doing worse. (The drop in auto performance can be attributed to longer auto loan terms, higher LTVs, lower used car re-sale prices, and the “Lyft effect”).
If a loan is prepaid before the 12-months mark the originator loses money as the net interest margin is not enough to compensate for the origination and servicing expenses. Only 23% of prepaid loans are refinanced, and most consumers go for a longer tenor loan with a higher balance.
Mike Meru Has $ 1 Million in Student Loans. How Did That Happen? (WSJ), Rated: AAA
Due to escalating tuition and easy credit, the U.S. has 101 people who owe at least $1 million in federal student loans, according to the Education Department. Five years ago, 14 people owed that much.
Silver Hill Funding’s Leslie Smith is Targeting the Underserved in the SBL Space (Commercial Observer) Rated: A
In March, Smith oversaw the formal launch of Commercial Direct, an online small-balance loan customization platform that’s a division of multibillion dollar real estate investment firm Silver Hill Funding, a subsidiary of Bayview Loan Servicing.
Commercial Direct’s lending strategy targets small business owners, entrepreneurs and investors who are relatively new to the commercial real estate arena or are looking to expand or diversify their portfolios. The platform finances commercial and residential condominiums, among many other asset classes, and closes loans in 30 days or fewer, according to Commercial Direct’s website.
With the backing of Silver Hill—which has funded more than 20,000 transactions since its founding—and Bayview Loan Servicing, the platform is off to a strong start.
Fintech adds another S.F. office (San Fransciso Business Journal) Rated: A
After snapping up a new headquarters last year, fintech company Affirm leased up 46,000 square feet in 550 Kearny St. in San Francisco with landlord Brickman.
The new space is around the corner from the company’s headquarters in 650 California St., where it leased 86,225 square feet.
For Your Money, Which is Better: The Algorithm or the Adviser? (Kiplinger) Rated: A
The reality is, the rapid growth and early-stage adoption of financial technology (FinTech) indicates an industry disruption is underway. Algorithm-based, digital advisory technology has brought us the increasingly popular “robo-advisers,” which replace human advisers with software programmed to understand and advise on clients’ needs. Robo-adviser firms have witnessed triple-digit growth since 2013. Research firm Cerulli Associates reported they had about $60 billion in assets under management (AUM) at the end of 2016, and could amass an estimated $385 billion by 2021.
Are we in the Golden Age of Fintech? (Fintech TV), Rated: A
Dubbed the ‘Mayor of Fintech’, Ron Suber discusses the current fintech landscape, and what technology has him excited about the future.
Can your side gig fund retirement? (CU Insight) Rated: A
Almost 40% of respondents in a recent Betterment survey said they feel unprepared to save enough to maintain their lifestyle during retirement. As a result, they have become members of the growing gig economy by either supplementing their full-time job or relying solely on their independent work/temporary contracts.
According to “The Gig Economy and Future of Retirement” survey, 76% of those 55 and older were using earnings from a second job to save for retirement, as were 65% of people 35 to 54. In addition, 42% of gig workers under 35 say they’re moonlighting to help save for retirement.
Online lender Earnest gathered data from tens of thousands of loan applicants to learn just how much people are actually earning from their gig. They found 85% of people take home an average of $500 per month from their side hustles.
CompareCards Releases 2018 Credit Card Fee Report (PR Newswire) Rated: AAA
Highlights from CompareCards 2018 Credit Card Fee Report:
- Two cards — both no-frills credit cards from credit unions — had only a single fee. One card in the survey had as many as nine fees.
- Credit union-issued credit cards have 2.73 fees per card, lower than 4.48 fees for cards issued by banks.
- The most common fee levied by issuers is the late payment fee: 99.5 percent of cards impose this fee, averaging $36.02.
- The average balance transfer fee, among cards that allow them, is 3.46 percent.
- The average cash advance fee is 3.99 percent.
- Foreign transaction fees, overall, average 1.48 percent, including cards that have no fee. But if cards assess the fee, most of the time the fee is 3 percent of the purchase price.
- When compared with smaller credit card issuers, larger credit card issuers assess higher cash advance fees (4.11 percent, versus 3.86 percent) and balance transfers fees (3.49 percent versus 3.42 percent), on average.
- However, average foreign transaction fees are lower at larger credit card issuers (1.22 percent, versus 1.76 percent at smaller issuers).
RBC Wealth Management – U.S. launches new digital alternative investments platform (PR Newswire) Rated: B
RBC Wealth Management-U.S., one of the nation’s largest full-service wealth management firms, is taking some of the mystery and difficulty out of alternative investing with a new digital alternative investment platform for high-net worth clients.
Developed in partnership with Artivest, an award-winning alternative investment management and technology solutions provider, RBC Wealth Management’s cloud-based investment platform gives financial advisors and their clients access to leading private equity and hedge funds across sectors, stages and styles.
Five Firms Hit by ‘Crypto-Sweep’ in Alabama as Regulators Step up Operation (Bitcoin News) Rated: B
Cease and desist letters have been sent to three Los Angeles based companies. The second firm form California, Leverage, has advertised itself as a crypto lending platform offering to investors a variable, daily interest. This case is again about an unlicensed security, the ASC said.
5 Ways to Get ‘Free’ Money From Your Employer Without a Raise (Student Loan Hero) Rated: B
2. Use your company’s 401(k) matching program
Saving for the long term can be a challenge: 69% of millennials surveyed are not saving for retirement, according to online lender Earnest. Although it can be hard to think about setting aside money when you have to manage student loan payments, it can help with future financial goals — especially if your employer offers a match on retirement plans.
Tandem reaches 100,000 clients, signs for Form3 paytech (Banking Tech), Rated: AAA
SMEs: a neglected opportunity for UK big banks (SME Magazine) Rated: AAA
Big banks are neglecting the SME market opportunity due to a variety of factors. One of the main problems is the onboarding process, where in many cases the ownership structure can be unclear, leading to difficulties around initiating relationships with SME businesses.
Second, the nature of the SME growth model makes it difficult for banks to determine the value of the business opportunity. This poses problems when it comes to granting credit facilities to SMEs, as they are seen as higher risk for conducting business with.
Third, banks follow bigger sources of revenue and SME profitability is lower than larger organisations.
Finally, existing legacy software systems prevent large banks from servicing SME customer demands which go beyond traditional offerings. For example, the desire to integrate P2P lending, blockchain, mobile wallets, and accounting and legal functionality all as one end-to-end service.
Why scaleups still shy away from debt and equity growth funding (Real Business) Rated: A
Some £2.9 billion was claimed in R&D tax credits during 2015-16, according to HMRC, with the average amount of relief claimed via the SME scheme increasing from £56,223 to £61,514.
Despite a dip in deal numbers in 2016, the crowdfunding boom returned. Beauhurst data claimed £8.27 billion was invested in 2017 – more than double the previous year.
Department store numbers fall by quarter (Drapers) Rated: B
A report by peer-to-peer lending platform Lendy found that the number of large department stores fell from 240 in 2009 to 180 in 2016. The total number of shops fell from 407,000 to 403,000 during the same period.
Lendy said department stores had been more negatively affected than the rest of the high street by online shopping, as the heavy debt burdens carried by their owners had hampered their own investment in ecommerce and store refurbishment.
Worst Is Past for Microlenders — Analysts (Caixin Global) Rated: AAA
Effects of a late-year regulatory crackdown on Chinese online lenders has most likely run its course by now, analysts said, even as shares of U.S.-listed companies continue to feel some lingering fallout.
Shares of online lenders Qudian Inc. and LexinFintech Holdings Ltd. have tumbled by 24% and 17% respectively since the firms released their first-quarter results a week ago, wiping out over $1.4 billion in combined market value. Yirendai Ltd., the first Chinese peer-to-peer (P2P) lender to list in the U.S., saw its shares fall by 4% a day after releasing its earnings results after trading on Thursday.
To curb excess in the 1 trillion yuan ($156 billion) unsecured short-term loan industry, regulators issued rules in early December that capped annual interest rates on loans at 36%, barred lenders from offering loans to borrowers with no source of income, and tightened scrutiny over funding sources.
Credible Lab CEO Stephen Dash likens ASX to ‘junior Nasdaq’ (Australian Financial Review) Rated: A
Credible Labs Inc founder and chief executive Stephen Dash said he had chosen an ASX listing for the company, which allows users to sort through US student loans, because a large number of the company’s early investors were based in Australia and Asia.
How the Fintech Industry is Drawing Young Talent in the Country (Entrepreneur) Rated: AAA
The fintech industry is creating new and exciting opportunities for the country’s workforce in such areas as payments, retail baking, peer-to-peer debt financing, personal finance, asset management, institutional investments, remittances, and financial research. However, the primary enabler for all these segments is data. The volume of data that is being generated and leveraged by the digital banking and financial services industry is massive and unprecedented. As a result, the demand for technically trained data scientists is growing rapidly among fintech companies. With an increasing number of people in the country consuming fintech products, data scientists are required to manage large, complex sets of data and organise them to facilitate faster and enhanced delivery of various services to consumers.
Acko Gets $ 12 mn funding from Amazon, others (Elets Online) Rate: A
Online insurance startup Acko General Insurance Co. has raised $12 million (around Rs 80 crore) in a new round of funding led by e-commerce giant Amazon, an official statement revealed.
The latest funding infusion that saw participation from Ashish Dhawan, angel investor and founder of private equity fund ChrysCapital and existing investor Catamaran Ventures, the family office of Infosys co-founder NR Narayana Murthy, takes Acko’s total external funding to nearly $42 million.
In recent times the online lender that has joined hands with cab aggregator Ola to offer in-ride insurance to riders is said to be exploring venturing into travel insurance and healthcare space.
Singapore Has Fintech Dreams, But It’s Short on Tech Talent (Bloomberg) Rated: A
Singapore’s goal of becoming a high-tech financial hub is running into real-world problems of labor supply and demand.
Technology startups in many countries are fighting to attract skilled workers like software engineers. Yet in the tiny city-state of Singapore, with a population of 5.6 million, the dearth of talent is particularly acute. The nation’s universities and polytechnic schools churn out what the government estimates are 400 graduates a year with the right qualifications, well short of plans to add 1,000 financial tech jobs annually, according to the Singapore Fintech Association.
Lidya Scores $ 6.9 Million in Series A Investment (Finovate), Rated: AAA
Nigeria-based digital bank Lidya landed a fresh round of funding this week. The bank pulled in a Series A round totaling $6.9 million, an amount that marks the round as one of Nigeria’s largest tech investments. Combined with the $1.25 million Lidya received last March, today’s round brings the bank’s total funding to $8.2 million.
Qualcomm can still avoid paying a 1-per-cent bonus to bondholders after a delayed deal
Glenn Branca; witch hunts; inequality; SAAS models; Katz’s; austerity Britain; and much more…