News Comments Today’s main news: Google gets EU eMoney license. JD launches online P2P lending service in China. Hexindai partners with Kunming Aotous. Today’s main analysis: Equity sector analysis. Today’s thought-provoking articles: Internet finance in a state of flux in China. P2P lending looking for a fresh start. Wonga collapse clears way for US payday lenders in UK. United […]
We have identified a $377 billion addressable U.S. online travel market. Millennials, the largest consumer group in the U.S., are shifting their spending from products to experiences.
We’ve also found that 55% of people are avoiding credit cards at checkout when paying for travel. 67% are looking for options to pay over time.
1. Consumers will demand more control over their data.
2. Alternative lending will continue to grow.
Given that around 80 percent of small business loan applications are rejected, startup founders are increasingly looking to nontraditional financiers for capital.
Chicago-based Enova, which also operates Pounds to Pocket and On Stride, saw UK revenue jump 20% to $36.6m (£29m). Texas-headquartered Elevate Credit operates in the UK under the Sunny loans brand, and saw its own UK revenue jump 23% to $32m, as new customer loans for Sunny rose 45% to $26,671.
Curo, which is behind WageDayAdvance, saw UK revenue jump 27.1% to $13.5m, while underlying earnings nearly halved from $8.1m to $4.2m. It was helped by a “high percentage of new customers”.
Ethical lenders that have been touted as alternatives to high-cost firms such as Wonga and BrightHouse are going out of business at the fastest rate in years, fuelling concerns that less well-off customers are in danger of losing access to credit.
The figures mark the worst year since at least 2010, as the sector battles against rising regulatory and technology costs.
Eight credit unions closed in 2018, and they affected an estimated 14,000 people with a collective £25 million in savings. Even some of the more successful CUs have had to curtail lending. Credit unions cap rates at 3 percent a month.
Despite initial reports of the feature’s disappearance, Hefeng Online Lending was still available until 4 p.m. on Wednesday. Previously, all products were labeled as being “sold out” after it was removed from the app’s main page. It has subsequently been completely removed.
E-commerce giant JD.com has become the first Chinese tech tycoon to launch peer-to-peer online lending products, CHNFUND.com reported on Sunday.
“Hefeng online lending” or literally “Hefeng Wangdai”, a platform providing information service on P2P online lending under JD.com, sold out all the products within seconds after it started operation on Sunday.
JD Finance has removed its second peer-to-peer (P2P) lending feature from its app after it had been online for less than 10 days, highlighting difficulties in China’s P2P loans sector.
Chinese peer-to-peer lending platform Hexindai (NASDAQ: HX) announced on Wednesday it has formed a funding sources partnership with Kunming Aotou Economic Information Consulting Co., Ltd. (Kunming Aotou).
Hexindai reported that through this agreement it will assess borrowers that are using its risk management and credit assessment capabilities before referring them to Kunming Aotou which will facilitate the loans through a trust fund.
Recently, the Beijing-based Chang An Property Casualty Insurance Co was reported to have compensated nearly 2 billion yuan ($290 million) for its joint business with a number of domestic peer-to-peer (P2P) online lending platforms, according to a report of the Time Weekly.
The Lengjing reported that so far 220 P2P platforms had submitted their self-investigation reports to the government.
The Lithuanian FinTech initiative now covers more than 100 licensed companies, with most of them involved in payments, electronic money and peer-to-peer lending and crowdfunding.
But even P2P Global Investments, the first investment fund dedicated to the sector when it launched in 2014, admits the initial “frenzy” of interest has died down.
It is considering changing its name because it no longer accurately reflects the fund’s interests.
Mike Bristow, chief executive of property lender CrowdProperty, suggested that some companies have tried to take advantage of the hype around peer-to-peer without making effective business plans.
Micro-lending: Mynt Philippine fintech, Mynt, talks about the business case and technology behind its current micro-lending efforts and where it is planning to head with other financial services, leveraging the customers and data of its majority shareholder, the country’s largest Telco.
Robocash – fintech crossing the borders
In 2017, peer-to-peer (P2P) platform Robocash started its operations in the European Union (EU). Since then, it attracted more than €4 million
Home Credit – to its credit In an exclusive tour of Home Credit’s (HC) operations in Prague, we met seven staff members and learned about its retail challenger Air Bank, P2P lender Zonky and Home Credit Venture Capital (HCVC).
Every loan involves a cost. From the time of signing up to delay in repaying the loan, here’s a list of charges a borrower needs to pay while taking a loan from a peer-to-peer (P2P) lending platform.
UMG Idealab has started its venture journey in Indonesia with 11 portfolios to date.
UMG Idealab is looking for startups in IoT, Big Data, Voice Recognition (VR), and Artificial Intelligent (AI). He aims to invest in 20 startups next year.
The State Bank of Việt Nam (SBV) has warned local people and firms to consider carefully and be cautious before taking part in peer-to-peer (P2P) lending as there are many potential risks related to the service.
When an industry develops at a breakneck speed, the law can take some time to catch up. Existing regulations usually do not fit new paradigms, and it can stifle innovation. A regulatory sandbox is the perfect solution because it allows for the testing of new innovations in a controlled environment. The term “sandbox” refers to […]
When an industry develops at a breakneck speed, the law can take some time to catch up. Existing regulations usually do not fit new paradigms, and it can stifle innovation. A regulatory sandbox is the perfect solution because it allows for the testing of new innovations in a controlled environment.
The term “sandbox” refers to the box of sand where small children play in a confined boundary. The term has received a new connotation in a commercial sense and refers to a closed environment used for experimenting and testing projects or new ideas. Regulatory sandboxes help in testing business proposals and prototypes under a regulator’s supervision. These testing grounds have an advantage of not being governed by current rules and, therefore, the business can explicitly experiment the validity of their projects without the danger of getting caught on the wrong side of existing law.
Such regulatory sandboxes are critical for the development of the alternative lending industry. The gist of having regulatory sandboxes in this sector is to comply with the regulatory directives that complement the growth of fintech companies without compromising on users’ safety and protection. The existence of suitable safeguards assists players in executing a live trial in the market without having to worry about the legal consequences.
The Dawn of the Regulatory Sandbox
Financial regulators across the globe understand the challenges and opportunities presented by innovations like digital-only banking, P2P lending, robo-advisors, and other fintech innovations. Some countries have taken the lead in ensuring that an ecosystem is created which helps startups experiment with their products and services without running afoul of current rules.
United Kingdom- The Pioneer
Seeing massive investor interest in this industry, the Financial Conduct Authority (FCA) proposed a regulatory sandbox as a part of its Project Innovate. It started accepting applications in mid-2016.
The UK has completed the successful testing of models from 18 out of 69 firms in the first phase and 24 out of 77 firms in the second phase. The sandbox has accepted 18 out of 61 firms for the third phase, and 29 out of 69 applications received qualified to the testing stage in the fuurth phase.
Participants in the UK sandbox came from sectors like retail banking, general insurance, retail lending, and wholesale lending. Around 35 percent of the participants in the secnd phase were from other countries, including the US and Singapore. The fourth cohort has almost 40 percent of startups experimenting with distributed ledger technology for disrupting traditional finance.
The UK regulatory sandbox includes:
A positive reaction from other global regulators.
The startup community’s eagerness is evident from each phase being oversubscribed.
It has reduced the time to get an idea to market. FCA claims that, during the first year itself, 90 percent of the firms were able to go for a commercial market launch of their product.
Also, many of the approved fintech companies were able to attract VC investment for their projects.
Singapore
The second jurisdiction to launch the concept of a regulatory sandbox is Singapore. The Monetary Authority of Singapore (MAS) introduced its sandbox in June 2016. It has launched a range of schemes for interested startups. Till date, the country has the maximum regulatory alliances and has entered into co-operation arrangements with eight countries including UK, Australia, and Japan.
Since its launch, the MAS has guided over 140 applicants from around the globe. About one in five applications has been approved for experimentation.
Startups in crowdfunding, financial advisory, artificial intelligence, cross-border funding, distributed ledgers, and more were able to experiment under the MAS scheme. The sandbox has helped Singapore attract overseas startups to come and do business in the country. And it is contributing positively in making Singapore a Smart Financial Hub by allowing these young startups to form partnerships with traditional financial institutions.
United States
The Consumer Protection Financial Bureau (CPFB) initiated the concept of regulatory sandboxes to ensure global compliance and to stimulate innovation in the fintech industry.
Arizona became the first state to open a fintech sandbox in the US by passing a legislation to create a Regulatory Sandbox Program. This program will enable finetch players to test their financial products without being subjected to the licensing provisions of the state. The move will come under the supervision of the Arizona Attorney General. Another state, Illinois, also on the footsteps of Arizona, has a separate regulatory bill (currently on hold) on the horizon.
Along with the regulatory sandbox, the US has also launched an ‘office of innovation’, which primarily focuses on blockchain and cryptocurrency technologies. The aim is to stimulate competition in the industry and expedite consumer advancement.
The participants included payment start-ups, financial technology companies, credit agencies, and lending companies.
The startups in the Arizona sandbox will be allowed to experiment with their financial products for a period of up to two years. The sandbox has promoted investment and job creation in the state. It will help improve the competitive position of the country in the global fintech industry. The concept has also helped early stage entrepreneurs surpass the legal hurdles with access to a trillion dollar opportunity.
Canada
The Ontario Securities Commission (OSC) launched its sandbox “LaunchPad” in February 2017. The government is said to create a “super sandbox” that will help foster communication between fintech players, financial institutions, regulators, and the government. It is a part of its 2016-2019 Business Plan to understand how technology affects the markets. An agency by the name Ontario Fintech Accelerator Office will also be instituted to provide assistance to start ups. The government plans to develop the retail payment and financial sector framework at the national level.
It has given a push to Canada’s innovation market as earlier, due to the domination of a few financial companies in the industry, innovation was slow. Now, it has allowed Canadian fintech companies to come forward and grow both locally and internationally. The new idea will benefit Canadian SMEs who could not access funding from traditional lenders.
Global Integration
The concept of regulatory sandboxes is currently running in over 20 nations. Apart from the countries mentioned above, Australia, Indonesia, Hong Kong, Malaysia, Denmark, and Thailand have sandboxes running to join the race. To promote interaction among participants at a global level, a GFIN (Global Financial Innovation Network) has been launched, aimed at knowledge sharing and facilitating cross-border testing of ideas. It is a joint effort of FCA and 11 other regulatory authorities. Organizations such as the US CFPB, Hong Kong Monetary Authority, UK FCA, MAS, and others, are a part of this network. The goal is to go past the idea of a sandbox and ensure that regulators are able to support the advancements in the fintech industry.
News Comments Today’s main news: OnDeck to enter equipment financing. SoFi releases video to destigmatize debt. RateSetter sees 47% revenue growth. Funding Circle fund expects lower returns. 360 Finance financials. Today’s main analysis: U.S. yield curve inverts. Today’s thought-provoking articles: Why did OnDeck file suit in Arlington? Fewer Americans rely on cash. More than half of Americans can’t cover a $1,000 […]
Fewer Americans rely on cash. Still, in this day of maximum credit card usage and digital payments, more than half of Americans still make some purchases with cash. I would hazard a guess to say it’s mostly older Americans and, most definitely, the underbanked.
OnDeck announced today that it will begin offering equipment finance loans to select U.S. small businesses next year, bringing its heralded technology and digital lending expertise to what has traditionally been a slow-moving, opaque, and complicated process.
At 2 p.m. on a Friday in mid-October, it’s judgment day for 13 small companies from across the country.
The plaintiff is On Deck Capital Inc., a publicly traded online small business lender based in New York that has sued each of the 13 companies for not repaying loans. Its choice of setting: the Arlington General District Courthouse.
SoFi today launched a campaign showcasing some of its members’ most intimate stories around their personal struggles with money. Produced in collaboration with director Tatia Pilieva, the filmmaker most notably known for her sensational short film ‘First Kiss,’ the video captures twelve SoFi members, strangers to each other, meeting for the first time to have open-ended, unfiltered conversations about their lives, their money, and their views for their futures.
The video, along with more about the members featured in the video, are now live at
Core CPI rose by 2.2% keeping the Fed on track to raise interest rates next week for the fourth time this year. The market-implied probability of a rate hike next week is ~77%, although the rate hike path in 2019 remains uncertain. The US yield curve saw its first post-crisis flatteningwhich we will look at in greater detail below.
US Yield Curve Inverts for the First Time Post-Crisis
The US yield-curve saw its first inversion post-crisis as the spreads between the yields on 3-year and 5-year Treasuries fell to -1 bps. The spread between the yields on 3-month and 10-year treasuries has been an accurate predictor of past recessions. As the chart below shows, there have been 6 recessions since 1970 after the 3-month – 10-year curve inverted. Currently, the 3-month – 10-year curve is 49 bps away from inversion, but markets are watching every part of the yield curve closely.
Source: Federal Reserve, PeerIQ
Spreads are Widening on New FinTech Deals
LendingClub and CommonBond are out with new securitizations. KBRA has rated the tranches on LendingClub’s latest $272 Mn deal CLUB 2018-P3 A-, BBB, and BB. The $300 Mn collateral pool consists of 17,825 Prime loans with an average balance of $16.8 k, a weighted average coupon of 14.58%, and a weighted average remaining term of 48 months. The weighted average FICO score of the borrowers is 703. The deal has an initial O/C of 9.2% and an excess spread of 9.1%. Both the O/C and excess spread are the lowest for LC’s 2018 prime deals. This deal priced 27-50bps wider than LC’s prior deal in September due to market volatility and widening structured products spreads, according to DebtWire.
Americans are becoming less reliant on physical currency. Roughly three-in-ten U.S. adults (29%) say they make no purchases using cash during a typical week, up slightly from 24% in 2015. And the share who say that all or almost all of their weekly purchases are made using cash has modestly decreased, from 24% in 2015 to 18% today, according to a new Pew Research Center survey that comes as some businesses experiment with becoming cashless establishments.
Only 48 percent of Americans say they could handle a $1,000 emergency expense using cash or savings in their bank accounts. Tapping savings was the most common strategy for handling an emergency, followed by borrowing from friends or family.
Six in 10 Americans have had an emergency in the past year that cost them $1,000 or more.
One-third of Americans are currently in debt from an emergency expense they couldn’t cover.
Of Americans who had to go into debt to cover a past emergency, a third still owe $5,000 or more for this expense and about 18 percent have emergency debt balances of $10,000 or more.
The majority of Americans would have to turn to other options to pay for an emergency:
Salt Lake City, Minneapolis and Pittsburgh are the metros where millennials are making up the largest percentage of purchase requests. In Salt Lake City, a majority of the total purchase requests in the area, 51 percent, come from millennials. In Minneapolis and Pittsburgh, 48 percent come from millennials.
In Tampa, Fla., Las Vegas and Miami, millennials are making the least purchase requests. Only 30 percent of purchase requests came from people under 35 in Tampa. That number was only slightly higher in Las Vegas and Miami, where 31 percent and 32 percent of purchase requests came from those under 35.
San Francisco, San Jose, Calif. and New York are where millennials wait the longest to buy homes. The average age for these three areas was 29.6 years old. This compares with an average of 28.7 years old across the remaining 47 largest metros in the U.S.
Salt Lake City, Louisville, Ky. and Cincinnati are the metros with the lowest average age of buyers under 35. In each of these areas, the average age for potential millennial homebuyers is around 28 years old.
San Jose, Calif., San Francisco and New York are the places where millennials had the highest average credit scores. In each of these areas, the average millennial homebuyer had a credit score higher than 704. By comparison, the average credit score for millennial homebuyers across the 50 largest MSAs in the country was 656.
Memphis, Tenn., Birmingham, Ala. and New Orleans are where millennials had the lowest average credit scores. Credit scores in these three areas were 622, 629 and 634 respectively.
Many people live paycheck to paycheck, relying on the next deposit that will hit their account to cover their living expenses, bills and debt payments. Despite many people having no or little savings on which to fall back, the vast majority of Americans (95%) in the largest 100 metros manage to pay their bills on time.
More Americans fell behind on their bills in December than at any other time during the 12-month period we reviewed. This timing coincides with spending for the holiday season, suggesting that some consumers stretched past their financial limits to celebrate this festive time.
Americans played a bit of catch-up on their holiday debt in January but fell slightly behind again in February. Year-end bonuses possibly helped some consumers pay immediate bills but didn’t resolve over-extension from holiday debt.
Many people caught up with their bills in April — right around tax refund time, a sign that many people rely on their refunds to get them current and caught up on payments. (Tax refunds in 2018 were delayed for millions of taxpayers due to extra scrutiny for people claiming certain common credits.)
The jump in people current with their bills continued through September. This continued trend suggests that the tax returns, and possibly improving economic conditions over the summer of 2018, helped people manage their existing debts going forward.
In the first complaint filed on December 14, 2018 in the U.S. Bankruptcy Court in Chicago, Argon’s trustee Eugene Craneasserts that, “During the course of the Debtors’ limited business operations spanning approximately two years, Argon Credit’s officers and members of its board of managers repeatedly breached their fiduciary duties of loyalty and care to the Debtors and to the Debtors’ creditors by:
(i) scheming to funnel assets away from the Debtors and their creditors,
(ii) transferring assets to insiders;
(iii) double-pledging assets to the Debtors’ secured lender and an insider’s lender;
(iv) knowingly submitting false or misleading financial information to the Debtors’ secured lender, including a false accounts receivable report;
(v) paying themselves exorbitant “commissions” without disclosure to or approval of the Debtors’ board of managers,
(vi) using company funds to pay for personal expenses unrelated to the Debtors’ business operations; and,
(vii) authorizing the Debtors to enter into purported loans with investors which were really contributions of equity and authorizing equity distributions to those investors at a time when the Debtors were insolvent.”
In the second complaint filed against Joseph Canfora’s Margon LLC, James Uihlein’s Little Owl Argon LLC, Mark Triffler’sTriffler Trust, and Barry Edmonson’s Cardinal Trust, Crane’s complaint contends,
“This action arises out of a series of transactions between Argon Credit and the Defendants by which the Defendants purportedly loaned funds to Argon Credit and Argon Credit made supposed principal and interest payments to the Defendants totaling more than $2.5 million on account of those purported loans. However, Argon Credit and the Defendants also entered into simultaneous subscription agreements by which the Defendants received equity in Argon Credit for no additional consideration and which was commensurate with the amount of their purported loans. In reality, these supposed loans were disguised equity contributions and Argon Credit’s principal and interest payments to Defendants were actually equity distributions.”
The Bankruptcy Court filings can be found here and here.
Roostify Offers Enhanced ADA Compliance to Lenders for a Better Consumer Lending Experience (Roostify Email), Rated: A
Virtual bank Radius Bank — which services small businesses (SMBs), micro-firms and consumers — is rolling out a revamped digital banking platform and a mobile banking app, the company said on Monday (Dec. 17). Resulting from its partnership with FinTech firm Narmi, the upgrades target the customer experience, according to Radius CEO and President Mike Butler.
Velocity Solutions announced today that its Akouba digital lending platform was selected by Entegra Bank to power the bank’s digital lending for its small and medium-sized business customers. Akouba provides community and regional banks with origination and underwriting services.
Lending Express, the technology company dedicated to increasing access to funding for small businesses, today announced the promotions of Ofer Ariel and Daniel Katz to Chief Product Officer and Chief Operating Officer, respectively. This announcement follows a period of impressive growth for the company, and is indicative of its commitment to provide best-in-class service to both its customers and partners.
UK based peer-to-peer lender RateSetter announced last week the results of its 2017-2018 financial year, which ended on March 31, 2018. The lending platform reported that revenues were up by 47% (which was £34.3 million) from the previous year (£23.4 million). The company noted that the year-end, there were 44,441 active investors on the platform with loans under management of £700 million.
A hit from its European Investment Bank transaction as well as higher UK loss rates have prompted a fall in expected returns for the Funding Circle SME Income fund.
The £332m Funding Circle SME Income Fund saw a fall in its net asset value (NAV) of 1.4 per cent in November as the investment trust’s board said it expected returns for the full year would be lower than previously anticipated owing to a higher expected rate of defaults among certain loan pools.
ORCA has opened a waiting list for investors interested in its self-select portfolio and Innovative Finance ISA (IFISA), with plans to launch both products in the first quarter of 2019.
The peer-to-peer lending analysis and investment platform, which first revealed its plans to launch a tax wrapper to Peer2Peer Finance News in October, said the Orca ISA will allow investors to hold multiple P2P loans from different providers in one tax wrapper.
Cross-border payments were ripe for disruption and doing more than most to shake up things is peer-to-peer (P2P) specialist, Transferwise. Its number of partnerships with banks is multiplying while, in parallel, it is adding settlement options, most recently for direct access to the euro payment infrastructure through a euro settlement account with the Bank of Lithuania.
At present, with one notable exception, the partner banks that have been announced are challenger or other low-end players. However, it now claims over four million people around the world using its service to transfer over £3 billion each month. In the UK, global head of partnerships, Stuart Gregory, says its share of consumer international transfers is around 15%, putting in on or close to a par with some of the largest UK banks.
N26, the provider of mobile banking services which launched in the UK last month with a free account, is now offering N26 Metal – its first premium membership for UK customers.
For the price of £14.90 per month, Metal members get access to an exclusive partner program, dedicated customer service, and worldwide travel insurance provided by Allianz. In addition, members benefit from free ATM withdrawals in pounds, free payments in any currency, free withdrawals worldwide, and LoungeKey airport access in over 1k destinations.
The head of innovation at one of Britain’s big high street banks told me earlier this year that he has a mantra when approaching a new problem: “What would Monzo do?”
Traditional banks are struggling to keep pace as Monzo pushes the boundaries. The startup sends smartphone push alerts when you spend money, knows when you’re abroad, lets you freeze your debit card if lost, and offers chatbot customer service — all through the app.
Onfido, the global identity verification company, announced Tuesday (Dec. 18) that it achieved 342 percent sales growth in 2018 compared with 2017 and that it has a four-year growth rate of 3,857 percent.
Megan Caywood, Starling Bank’s chief platform officer, is joining Barclays, as she handed in her notice a couple of weeks ago, according to TechCrunch.
360 Finance, an online consumer loan platform that spun off from China’s anti-virus service giant 360 Group, has joined a raft of Chinese fintech companies to go public in the U.S. over the last two years.
The company priced its initial public offering at $16.50 per share last Friday, raising $51 million by selling 3.1 million American depositary shares.
Hong Kong is preparing for the arrival of virtual banks (VB) — pure digital players that offer banking services solely through digital channels without bricks-and-mortar branches. In an exclusive article from Synpulse we discover the challenges associated with virtual banking.
What is your differentiating proposition?
With HKMA’s recent announcement of receiving 29 applications for VB, competition is expected to be intense.
Focus on Customer Needs
Basic banking services are about fulfilling three main needs of the customer:
How do I pay or get paid?
How can I borrow?
How do I grow or protect my savings?
Capitalize on strong partnerships
FinTechs have traditionally excelled in one particular area (e.g.p2p lending, remittance and FX conversion).
Avoid a Pure Discount Model
VBs can leverage their lower operating costs to provide lower fees, higher deposit rates or other price incentives to attract customers. However, without a clear differentiating proposition, a pure low-cost play will not be sustainable.
A leading individual financial marketplace, Jiayin Group Inc., is seeking to raise up to $57.5 million in an initial public offering on the Nasdaq Global Select Market in New York.
In July, Jinri Toutiao launched a fintech product named Safe Lending. Up to 20,000 users were permitted to borrow up to RMB 200,000 (around $30,000) per person per day. The company claimed the Bank of Nanjing was one of its loan partners.
The product became the subject of investigations by the media in September. ByteDance later shuttered the online money lending service, while thousands of Chinese P2P lending companies shut down in the second half of the year.
Pintec Technology Holdings Ltd. (“PINTEC”) (NASDAQ: PT) today signed a strategic cooperation agreement with China National Investment & Guaranty Corporation (“I&G”), a leading enterprise in China’s guarantee industry. The two sides will jointly develop the next generation digital lending technologies and nurture a dynamic credit financing ecosystem for small and micro-sized enterprises in China.
Germany based Fintech creditshelf Aktiengesellschaft, an SME financing platform, is launching a new partnership with CrossLend to offer the first digital securitization of SME loans in Germany.
On invitation of Crowdestor I travelled to Riga and met the founders of Crowdestor Janis Timma and Gunars Udris. Crowdestor is a Latvian p2p lending platform for SME loans. They launched a year ago. Loans are typically for terms of up to 18 months and interest rates are quite high – the current loan offer by a transportation company seeking expansion capital carries 17% interest rate. The Crowdestor website is available in English, German and Portuguese language. Currently most investors on the platform are Germans, followed by Spanish investors.
Both financial institutions and fintech startups have made serving SMEs a priority in 2018. However, despite business current accounts like Mettle being created this year, online comparison marketplace Funding Options has helped millions of firms across Europe, especially those that cannot get traditional bank lending because they are early-stage, high-growth or in difficulty, since its launch in 2012.
Finastra has appointed Eric Duffaut as President and Global Head of Field Operations. Based at Finastra’s London Headquarters, Duffaut will take responsibility for the company’s entire go-to-market organization including global sales, services and consultancy, as well as overseeing the Finastra partner ecosystem.
Token of Ethos.io, a leading cryptocurrency wallet provider and Blockchain Financial Services (BFS) platform, has been officially listed on Nitrogen Network, a new decentralized peer-to-peer crypto lending network.
Nitrogen Network enables market participants to lend and borrow cryptocurrencies on their own terms, all while maintaining control of their holdings and private keys. This supports effective portfolio management and a diverse range of investment views across a wide variety of crypto assets.
As banks rein in lending in the wake of the banking royal commission which revealed “irresponsible lending is endemic in Australia”, those who might have easily secured a home loan a few years ago now face much more stringent criteria.
Banks are looking more carefully at expenses and debts which, for 2.7 million Australians, will include a HELP (formerly HECS) debt.
Vivriti Capital, a Chennai-based lending platform for corporate entities, has raised Series A equity funding of Rs 200 crores from Creation Investments, an investment management company focused on financial services.
3. Peer-to-Peer Lending or Debt Crowdfunding: Peer-to-Peer Lending (P2P lending) is a form of crowdfunding used to raise loans which are re-paid along with interest. It can be defined as the use of an online platform that matches lenders with borrowers in order to provide unsecured loans. The borrower can either be an individual or a legal person requiring a loan. The interest rate may be set by the platform or by mutual agreement between the borrower and the lender. Fees are paid to the platform by both the lender as well as the borrower.2
4. Equity Crowdfunding:
The SEBI Consultation Paper furnishes proposals for a regulatory framework governing procedure of Security based Crowdfunding methods for Start-ups and Small and Medium Enterprises (SMEs).
The Directions define a “Non-banking financial company – Peer to Peer Lending Platform”4(NBFC-P2P) as a non-banking institution which carries on the business of a Peer-to-Peer Lending Platform. Peer-to- Peer Lending Platform5 has been defined as an intermediary providing the services of loan facilitation via online medium or otherwise, to the participants6(a person who has entered into an arrangement with an NBFC-P2P to lend on it or to avail of loan facilitation services provided by it). Non-banking institutions other than companies have been prohibited from undertaking the business of Peer-to-Peer Lending platform.7 The Directions provide the scope of activities, prudential norms (the aggregate loans taken by a borrower at any point of time, across all P2Ps, is subject to a cap of Rs.10,00,000/-), operational guidelines, inter alia other regulations.
To say that 2018 was a rough year for peer-to-peer (P2P) lending businesses in China would be a gross understatement. It was nothing short of a bloodbath, mirroring in many ways the US sub-prime mortgage crisis of 2008-09.
China, despite its economic power, shares the following crucial features with smaller markets in South and Southeast Asia:
A large percentage of small-to-medium enterprises (SMEs) and individuals without access to traditional banking services
High mobile penetration among the population
Easy access to investor funds, both domestic as well as international
The Southeast Asian approach to P2P lending regulation is more proactive than the Chinese model
In the heydays of P2P platforms in China, the authorities pursued more of a “wait and watch” approach. In marked contrast, the regulatory bodies of Southeast Asian economies have adopted more pro-active steps to regulation.
The average internet speed in South Korea is 26.7 megabits per second, faster than anywhere else in the world, according to French virtual private network developer Le VPN.
No Korean bank has ever been in the mix for this much-coveted prize. Nor did a single Korean firm appear in the latest Forbes rankings of the world’s 50 most innovative fintech companies. Indeed, it’s hard to identify a single well-known and home-grown fintech brand. There’s no Korean answer to, say, China’s Ant Financial, or Singapore-based ride-sharing-to-food-delivery service Grab.
The Financial Services Authority (OJK) committed to monitoring legal and registered financial technology (fintech) companies of peer-to-peer lending or online loan as an effort to maintain the security for consumers.
Because of the lack of legacy IT infrastructure within banks in Russia, the country has been listed in the top five leaders of digital banking in Europe, according to a new Deloitte and ID Finance report.
Vitacon, a leading construction company that is revolutionizing the way people live in São Paulo, is launching one more investment opportunity for people seeking new options for earning income and diversifying their portfolios. The company, which for the past nine years has been incentivizing the shared economy in its residential developments, is launching the possibility for any investor to invest directly USD250 in a CD, a fixed income security issued by Banco Topázio, with a 24-month maturity, which allows for annual yields of up to 12.8%.
This new method, P2P Lending, is similar to one introduced in 2015, when Vitacon launched the first real estate crowdfunding, which surpassed expectations and created an international benchmark in the field, raising 28% above what was expected for the construction of the VN Cardoso de Melo building in a very prime location of São Paulo, scheduled for delivery next year.
