Friday July 6 2018, Daily News Digest

p2p loan korea

News Comments Today’s main news: PayPal, Synchrony close consumer credit portfolio deal. Personal loans hit record high. Funding Circle updates projected returns. Furongbao gets $121M investment. Creditshelf to IPO on Frankfurt Stock Exchange. Today’s main analysis: Swindlers in Korea tarnish P2P lending. Today’s thought-provoking articles: Why Kabbage isn’t ready to go public. Why a lack of local payment options hurts […]

p2p loan korea

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United Kingdom

China

International

India

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News Summary

United States

PayPal closes sale of consumer credit portfolio (FinExtra) Rated: AAA

PayPal Holdings, Inc. (NASDAQ: PYPL) today announced the closing of its consumer credit receivables transaction with Synchrony (NYSE: SYF).

Under the terms of the transaction, and related transactions with unaffiliated third parties, Synchrony acquired $7.6 billion in receivables, including PayPal’s U.S. consumer credit receivables portfolio, which totaled $6.8 billion at the time of closing, and approximately $0.8 billion in participation interests in receivables held by unaffiliated third parties. PayPal received approximately $6.9 billion in total consideration at closing.

Why This Ambitious Startup Isn’t Going Public–Yet (INC) Rated: AAA

Petralia was discussing her Atlanta-based company’s ambitious expansion plans this year, which include buying other startups and rolling out new payments products. But she was also joking about what’s shiny and new in the world of financial technology startups: everything and anything involving cryptocurrency, relating to the blockchain, or connected to artificial intelligence. Such startups were heavy on the ground in mid-June, when I interviewed Petralia and her co-founder, Rob Frohwein, at the annual MoneyConf event in Dublin, a 5,000-person gathering of entrepreneurs and established companies in every corner of the fintech ecosystem.

Lending remains a large draw for fintech-focused venture capitalists, who put $900 million into the sector in the first quarter of 2018, according to an April CB Insights report. However, venture capitalists are “on pace for a new low” of money spent on lending startups, even while overall global fintech investment is “on pace for a new high,” the report found. Instead, investors are increasingly willing to bet on startups working in wealth management or robo-advising, insurance and blockchain or cryptocurrency.

Karrot Personal Loans Got Chopped: Here’s Where to Borrow Instead (Student Loan Hero) Rated: A

In 2014, Kabbage introduced Karrot, a program that provided unsecured personal loans up to $35,000.

But Kabbage recently stopped offering Karrot personal loans to grow its other offerings. Customers who already borrowed Karrot personal loans can continue making payments online. But those in need of a personal loan will have to look elsewhere.

Business Loan Company Receives Highest Award from TopConsumerReviews.com (Markets Insider) Rated: B

TopConsumerReviews.com recently awarded their best-in-class 5 star rating to OnDeck, a leader among online lenders who facilitate Business Loans.

SoFi Elects Peggy Alford & Magdalena Yeşil to Board of Directors (Crowdfund Insider) Rated: B

On Tuesday, SoFi announced the election of Peggy Alford and Magdalena Yeşil to its Board of Directors. According to the online lender, Alford is the Chief Financial Officer and Head of Operations for the Chan Zuckerberg Initiative. Previously she held positions at PayPal as CFO of Americas, Global Credit and Global Products and COO in the Asia Pacific region. Most recently, she served as the head of Human Resources-People Operations as well as the head of Cross-Border Trade for PayPal.

Personal Loans Surge to a Record High (Bloomberg) Rated: AAA

Personal loans surged to a record this year and are the fastest-growing U.S. consumer-lending category, according to data from credit bureau TransUnion. Outstanding balances rose about 18 percent in the first quarter to $120 billion. Fintech companies originated 36 percent of total personal loans in 2017 compared with less than 1 percent in 2010, Chicago-based TransUnion said.

Web-based firms like LendingClub, Prosper Marketplace Inc. and closely held Social Finance Inc. are driving the expansion of personal loans. LendingClub said in a filing that personal-loan originations in the first quarter soared 20 percent from a year earlier to $2.1 billion.

Why DC Developers Heart Crowdfunding (Commercial Observer) Rated: A

Small Change, was founded by Eve Picker, an architect and urban designer, with the idea of connecting investors with real estate professionals. The company’s first offering was for a tiny house in Pittsburgh, Penn in 2015. (Picker and Small Change could not provide comment due to federal law. Regulation Crowdfunding requires that all information about an offering reside on the Small Change portal and nowhere else.)

While Small Change is one of the newer platforms to the scene, other online real estate crowdfunding platforms, like Fundrise and Patch of Land, have been around for years.

19 State Attorneys General Unite Against “Madden Fix” Bills (OLPI) Rated: A

The Attorneys General of 19 states and the District of Columbia (the “AGs”) on June 27, 2018, publicly opposed to previously proposed pieces of legislation pending in Congress often referred to as the “Madden fix” bills.   Namely, the AGs made their views against HR 3299 (“Protecting Consumers’ Access to Credit Act of 2017”) and HR 4439 (“Modernizing Credit Opportunities Act”) in a letter (“AG Letter”) to Majority Leader McConnell, Minority Leader Schumer, Chairman Crapo, and Ranking Member Brown.  A copy of the letter can be found here: AG Letter.  HR 3299 passed the U.S. House of Representatives and is pending in the Senate and revises various laws to state that a loan valid when made does not become invalid when it is sold, transferred or assigned.  HR 4439 pending in a House committee would explicitly state that a bank’s being named lender is not affected by any arrangement is has with a service provider.

Nelnet Files Application for Industrial Bank Charter (Nelnet) Rated: A

Nelnet (NYSE: NNI) today announced it has filed an application with the Federal Deposit Insurance Corporation (FDIC) and the Utah Department of Financial Institutions (UDFI) to establish Nelnet Bank, a Utah-chartered industrial bank. If the charter is granted, Nelnet Bank would operate as an internet bank franchise with a home office in Salt Lake City. Nelnet Bank would be a separate subsidiary of Nelnet, and the industrial bank charter would allow the company to maintain its other diversified business offerings.

Nelnet has hired Andrea Moss to lead the application process, and then Nelnet Bank if the charter is granted.

PayNet Sees Small Business Lending Reaching New Heights (Business Wire) Rated: A

The Thomson Reuters / PayNet Small Business Lending Index (SBLI) jumped 9.4 points to 152.7 in May and is up more than 10% on the year. The SBLI 3-month moving average also rose in May and is 11% above its year-ago level.

Of the ten largest states, growth was led by Texas (+12.9% Y/Y) and North Carolina (+12.3% Y/Y), which both climbed to record highs. The majority of industries also experienced growth in May, led by Transportation & Warehousing (+15.0% Y/Y), Mining (+9.4% Y/Y), and Construction (+7.5% Y/Y). Notably, all four of the industries that declined on a year-over-year basis are in the service sector, including Information (-9.3% Y/Y) and Accommodation & Food Services (-8.1% Y/Y). However, Health Care posted its third consecutive monthly gain (+4.1% Y/Y) after a steady two-year decline.

The PayNet Small Business Default Index (SBDFI) fell two basis points to 1.82% in May and is down seven basis points compared to a year ago, its sharpest annual decline since late 2014. On an annual basis, more than half of the major industries saw defaults fall in May, led by Mining (-183bp Y/Y), Transportation & Warehousing (-133bp Y/Y), and Professional Services (-32bp Y/Y). Regionally, defaults fell in eight of the ten largest states on a monthly basis, but were up in half of the largest states relative to year-ago levels. Notably, Texas (-36bp Y/Y) has seen defaults fall by double-digits in each of the last nine months.

United Kingdom

Funding Circle updates projected returns (Bridging & Commercial) Rated: AAA

Following the latest review, the P2P platform has updated the projected returns it displays for each lending option and will now show these returns as a range.

Projected returns are the annual returns that a diversified investor could earn after fees and bad debt, but before tax.

The projected returns for its balanced and conservative lending options are now:

• balanced: 6-7%
• conservative: 5-5.5%

P2P platform Lendy tops £400m funding (Mortgage Finance Gazette) Rated: A

Lendy’s latest milestone comes as some banks pare back their lending and more property developers seek out alternative finance options.

The firm reached £300 million in lending in April last year and has funded hundreds of bridging and commercial property development loans since its launch in 2012. These include residential developments, commercial property, and conversions.

The £400 million has been invested by over 21,500 investors who have earned more than £40 million in interest so far.

Money saving product recommendations “biggest incentive” to use Open Banking (Credit Strategy) Rated: A

Six months into Open Banking, two fifths of customers willing to share their bank transaction data with a new lender would do so if it provided product recommendations which save them money.

That’s according to research carried out by Equifax. Other motivations to share transaction data through Open Banking include the ability to easily compare products from different financial institutions (36 percent), being offered tailored incentives for switching to a new provider (34 percent), and a streamlined process when applying for mortgages (28 percent) and loans (25 percent).

Record first half for Scottish alternative lender (Business Insider) Rated: A

LendingCrowd , the Scottish alternative lending specialist, has reported record first half lending of almost £14m in 2018 and has upped its proportion of loans to Scotland-based businesses, helped by its £2.75m partnership deal with Scottish Enterprise’s investment arm.

After three consecutive months of record lending in April, May and June, the Edinburgh-based company loaned £13.9m in the first six months of the year, compared to £4.9m for the same period last year. Activity during the second quarter also reached an all-time high, with lending of £8.8m – a 225 per cent increase on the £2.7m delivered in the second quarter of 2017.

LendInvest notches another year of profit (AltFi News) Rated: A

Its loan originations came close to doubling, up 91 per cent to £536m. Revenues were also up, increasing to £53m for the year. Originations look set for further growth too, with lending capital growth of 94 per cent to £791m.

However, despite a surge in these key metrics, profits remain relatively modest at just £1.9m before tax for the period, up from £0.1m before tax the previous year, according to the firm’s gross management accounts. By IFRS standards, LendInvest recorded a similar £1.8m in profit last year, but made a loss of £1m in the preceding year (ending 31 March 2017).

Landbay co-founder looks to shake up property market (Peer2Peer Finance) Rated: A

GRAY Stern (pictured), the co-founder of buy-to-let peer-to-peer lender Landbay, is aiming to shake up the UK property market with his new company.

The investment portal, called Dot, enables amateur landlords to invest in UK and US properties that it has already sourced via estate agents and property portals. The properties come with a pre-approved mortgage, enabling anyone with a 30 per cent deposit to buy them instantly.

As part of its package, Dot provides all the services a landlord would need, including insurance, tax compliance, lettings and management, thereby taking some of the hassle out of the process.

Who is guiding the Big Three? (Peer2Peer Finance) Rated: A

The ‘big three’ P2P lenders – Zopa, Funding Circle and RateSetter – have often led the way in this process.

And as these firms have evolved, their board members – both executives and non-executive directors (NEDs) – have reflected these changes.

Here we look at the make-up of these boards and analyse the expertise and experience of the people who are guiding the big three.

Orca Cofounder Jordan Stodart Shares Update and Quiz Info (Crowdfund Insider) Rated: A

In preparation of its Lending Challenge, the P2P investment aggregation provider Orca partnered with UK P2P Lending Knowledge Leaderboard and posted a quiz targeting investors and industry players to see how much people know about the P2P knowledge. Neither questions nor answers will be posted here to keep the quiz fair.

Orca has teamed up with Peer2Peer Finance News; all winners will receive a print subscription to the magazine. The top 3 quiz placers will win:

  • 1st place: £100 John Lewis voucher, P2P Finance News magazine subscription & Trophy
  • 2nd place: Amazon Echo Dot and P2P Finance News magazine subscription & Silver medal
  • 3rd place: Regency Hamper and P2P Finance News magazine subscription & Bronze medal
China

Chinese P2P Lending Platform Furongbao Receives $ 121M Strategic Investment (China Money Network) Rated: AAA

Chinese peer-to-peer lending platform Furongbao announced that it has received a RMB800 million (US$120.6 million) series B round, strategic investment from a controlling shareholder of Wanjiale Gas Appliances, a Chinese household appliances manufacturer.

Chinese P2P platform fails to pay back $ 15m (Global Times) Rated: A

A Hangzhou-based peer-to-peer (P2P) lending platform  has failed to pay around 100 million yuan ($15 million) back to its investors, media reports said on Thursday.

An investor surnamed Zheng who is based in Hangzhou, East China’s Zhejiang Province, told the Global Times on Thursday that he had invested about 50,000 yuan on niubangold.com, but now he cannot withdraw money from the platform. “[Investors] have reported the case to local police,” Zheng said.

According to a statement posted on niubangold.com late Tuesday, projects worth 98.5 million yuan are overdue.

DLA Piper Adds Beijing Partner From Shearman (The American Lawyer) Rated: B

DLA Piper has recruited capital markets partner Yang Ge in Beijing from Shearman & Sterling, where she was counsel.

Ge’s practice focuses on equity and debt securities offerings. During her time at Shearman, which she joined in 2011, she was involved in several Chinese companies’ initial public offerings in the U.S., including advising the underwriters on online lender LexinFintech Holdings Ltd.’s $124.2 million Nasdaq IPO earlier this year and online micro-lender China Rapid Finance Ltd.’s $60 million listing on the New York Stock Exchange last year.

European Union

Creditshelf Plans Initial Public Offering on Frankfurt Stock Exchange in Q3 (Crowdfund Insider) Rated: AAA

Creditshelf Aktiengesellschaft, a Germany based online lender, has announced its intent to do an initial public offering (IPO) on the Frankfurt Stock Exchange. The IPO is currently scheduled to take place for the third quarter of 2018. The offering is expected to be newly issued shares with a capital increase in the amount of around € 15-20 million. Creditshelf says that Hevella Capital GmbH & Co. KGaA (backed by Rolf Elgeti) has placed a backstop order of up to € 15 million if and to the extent the shares are not subscribed for by investors in the course of the offering.

Creditshelf is an online lender that targets the German marketplace providing access to capital for SMEs. The platform targets a larger ticket size than many other SME lenders with an average loan size of around €500,000 and €600,000 – and moving higher.

International

‘Dollars On The Floor’ — Why A Lack Of Local Payment Options Hurts Retailers (PYMNTS) Rated: AAA

As digital technology keeps bringing new efficiencies to transactions, and more consumers around the world turn to eCommerce for retail and other purchases, an accompanying trend is making life interesting for merchants and payment providers. Local payments options are increasing, resulting in a sector that promises to undergo more fragmentation in the coming years.

Scandinavian consumers have embraced Klarna and other pay-by-invoice services — for reasons not entirely understood by Booth and other analysts, it seems.

If a Chinese consumer trying to make an online purchase cannot do so through Alipay or WeChat Pay, that consumer is more likely to search for another merchant that takes that form of payment rather than, say, using their own UnionPay-branded payment card, Booth said.

Key Learnings at the Cambridge Centre for Alternative Finance 2018 Conference (Lend Academy) Rated: A

Greg Medcraft is the former head securities regulator in Australia and is now the Director of the Directorate for Financial and Enterprise Affairs of the OECD. He talked about trust and how trust in business is low today, particularly in finance. The power of the crowd is impacting trust where companies misdeeds are amplified and public opinion can turn against a company quite quickly. One of the antidotes to this is distributed ledger technology that can create networks with more trust, transparency and traceability.

Probably the country with the biggest success story when it comes to financial inclusion is Kenya. While I have heard the story of M-Pesa before I have never heard it from the person that was in charge of overseeing the economy as it was transforming Kenya. Professor Njuguna Ndung’u was the Governor of the Central Bank of Kenya from 2007 to 2015 during which time M-Pesa went from a curiosity to having half of the country’s GDP flowing through its platform. The introduction of such a system was a major challenge for central bankers as they worried about KYC concerns and financial instability.

India

PolicyBazaar.com Becomes First Indian Unicorn Foraying into Blockchain (BW Disrupt) Rated: AAA

Blockchain has been the talk of town primarily because of bitcoin and other crypto tokens’ parabolic rise in price and then the recent downfall. However the underlying technology, blockchain, rarely gets its fair share of limelight. But when a billion-dollar fintech startup plans a foray in this tech, it deserves attention.

In a chat with their CTO and CPO, Ashish Gupta, he revealed their plans to implement blockchain technology at PolicyBazaar.com, his outlook on the technology as well as how it could affect the fintech space in general.

Artha Venture Fund makes first close at Rs 40 crore (The Economic Times) Rated: A

Early stage venture capital firm Artha Venture Fund (AVF) has achieved the first close of its maiden fund having raised Rs 40 crore. Artha Venture Fund I, which received the approval of the Securities and Exchange Board of India in March this year, will have a corpus of Rs 200 crore along with a greenshoe option of Rs 100 crore.

The fund, which is structured as a Category I alternative investment fund, will invest in startups across seed, pre-series A and series-A levels of growth.

Lending platform BigWin Infotech gets NBFC-P2P certification from RBI (Media Nama) Rated: B

Fintech start-up, BigWin Infotech (PaisaDukan.com) has received its Certificate of Registration (CoR) from the Reserve Bank of India (RBI), paving the way for the launch of its Financial Platform – PaisaDukan.com, a release from the company said today.  Though the company received an in-principle approval from RBI to set up an NBFC Peer-to-Peer lending platform in May, the operations could only commence after the firm received a CoR from the central bank. The RBI issued those guidelines last October, to register and accredit P2P lending firms that resell loans from individuals who have money to invest.

P2P platform Monexo Fintech to raise $ 5 million in equity (The Economic Times) Rated: B

Armed with a licence from the banking regulator to operate an NBFC-cum-P2P lending platform, Monexo plans to invest in IT and infrastructure, which require continuous capital injection in the initial stages of any online marketplace.

The Mumbai-headquartered firm received the RBI licence last Friday.

Asia

Swindlers tarnish P2P loans’ reputation (Korea Joongang Daily) Rated: AAA

Korea’s peer-to-peer (P2P) lending market is turning out to be a Wild West of hucksters and frauds, and government regulations are nowhere in sight.

According to Crowd Institute, a research center that specializes in P2P financial markets, to date, about 3.65 trillion won ($3.2 billion) of P2P loans have been taken out in Korea, about five times the amount from two years ago.

Indonesia’s OVO platform to start peer-to-peer lending in Q4 – head (Nasdaq) Rated: B

Indonesian conglomerate Lippo Group’s payment platform OVO plans to start peer-to-peer lending in the fourth quarter of 2018, its head said on Thursday.

Authors:

George Popescu
Allen Taylor

Wednesday May 9 2018, Daily News Digest

Gross Revenue and Net interest

News Comments Today’s main news: SoFi is planning a credit card. LendingClub reports Q1 results. OnDeck reports Q1 results. Kabbage closes Orchard acquisition. Cross River passes $600M in monthly originations. Mintos achieves profitability. iZettle to pursue $1.1B valuation through IPO. TransferWise moves into Canada. Today’s main analysis: Review of OnDeck earnings. Today’s thought-provoking articles: Review of Marcus. Cities where borrowers save the most […]

Gross Revenue and Net interest

News Comments

United States

European Union

International

India

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News Summary

United States

SoFi Is Said to Plan Credit Card With Help From Former Citi Executive (Bloomberg) Rated: AAA

Social Finance Inc., a startup looking to offer a range of banking services to millennials, is working on a credit card and is bringing in a former Citigroup Inc. executive to help oversee the initiative, said people familiar with the matter.

The San Francisco-based company hopes to offer credit cards within the next year, said the people, who asked not to be identified because the plans are private. In preparation, SoFi is hiring Richard Garside to help lead the company’s operations, the people said.

Financial highlights for the first quarter include:

  • Delivered revenue of $151.7 million, up 22% year-over-year
  • Achieved 18% year-over-year growth in originations to over $2.3 billion
  • Improved Contribution Margin to 49.1% from 42.7% in the same quarter last year
  • Delivered Adjusted EBITDA of $15.3 million, or a 10.1% Adjusted EBITDA margin, compared to an Adjusted EBITDA of $0.2 million, or a 0.1% Adjusted EBITDA margin, in the same quarter last year
  • GAAP Consolidated Net Loss was ($31.2) million, including $17 million of expenses related to outstanding legacy issues disclosed by the Company in 2016, related to ongoing legal costs from government investigations, as well indemnification costs for the previous management.

Operational highlights for the first quarter include:

  • In the first quarter of 2018, LendingClub continued to execute on its mission to make credit more affordable and investing more rewarding, now having served over 2.4 million borrowers.
  • For Borrowers: LendingClub saw strong adoption of a new feature called Direct Payoff that allows borrowers to seamlessly pay off their credit card balances in exchange for a better rate – thereby improving their financial profile and lowering their monthly payments.
  • For Investors: LendingClub’s recently launched innovation, CLUB Certificates, attracted over $160 million in funding from several of the top names in asset management. The new CLUB Certificates give investors easy access to consumer credit and provide a single security that offers greater flexibility and liquidity.
  • Scott Sanborn, LendingClub CEO said, ‘We feel good about how we’ve kicked off the year and the fundamentals of our business continue to be strong. Our strategic initiatives are working on both sides of our marketplace and we’ll keep innovating to help more Americans on their journey to financial success.’.

 

OnDeck Reports First Quarter 2018 Financial Results (PR Newswire) Rated: AAA

OnDeck (NYSE: ONDK) today announced first quarter 2018 Gross revenue of $90 million, Net loss of $1.9 million, and Adjusted Net income of $6.4 million.

“Our first quarter results reflect a strong start to 2018 as we continue to execute on our strategic priorities to position our business for future success,” said Noah Breslow, chief executive officer, OnDeck. “We delivered 8% sequential loan growth while managing our sales and marketing costs, and had positive credit performance, as the 15+ Day Delinquency Ratio and Net Charge-off rate both improved significantly from a year ago.”

Review of OnDeck Q1 2018 Earnings Results (Lend Academy) Rated: AAA

While the company posted a net loss of $1.9 million for the quarter, this was within guidance. Gross revenues were $90 million, coming in at the top end of projections for the quarter. The increase in revenue was attributable to higher interest income or the company’s effective interest yield, or EIY which came in at 35.6%, compared to 34.8% in the previous quarter. OnDeck also beat on adjusted income which came in at $6.4 million (Q1 2018 guidance was between $1 and $5 million).

Source: Lend Academy

Originations were up 8% from the previous quarter at $591 million.

Source: Lend Academy

OnDeck swings to loss, but loan demand surges (American Banker) Rated: A

The New York company recorded a net loss of $2 million, or 3 cents per share, versus a loss of $11 million in the same period a year ago.

OnDeck earned $5.1 in fourth quarter, its first quarterly profit in two years. In a news release Tuesday, the company said that it would have earned $6.4 million in the quarter that ended March 31 if not for charges it took to cover the costs of leases terminations New York and Denver, severance for laid-off workers and other one-time expenses. The lease terminations are expected to save the company $2 million over the next eight years.

 

Kabbage’s Acquisition of Orchard Officially Closes (Crowdfund Insider) Rated: AAA

Orchard co-founder Matt Burton has emailed industry members stating the previously announced acquisition of his company by SME lender Kabbage has formally closed. The purchase had been rumored for weeks with an official announcement hitting the press at the end of April.

Burton, and co-founder and Chief Analytics Officer David Snitkof, have both joined Kabbage in leadership roles. In total, Kabbage will add more than twenty Orchard employees who are predominantly focused on advanced analytics, data science and engineering to its New York City office.

 

We tried Goldman’s Marcus, here’s our conclusion (Business Insider) Rated: AAA

Goldman Sachs’ consumer lending platform, Marcus, appears well on its way to becoming a full-scale digital banking offering. The platform has originated some $2.5 billion in loans since launching in October 2016, and now offers savings accounts with a minimum threshold of $1.

Source: Business Insider

Here’s why FIs should be worried about Marcus:

  • It’s backed by Goldman’s reputation, and deep pockets.
  • The interface is sleek and consumer friendly.
  • Its offerings are extremely competitive.

LendingTree Reveals Cities Where Borrowers Save the Most by Shopping Around for Mortgage Loans (PR Newswire) Rated: AAA

LendingTree today released its Mortgage Rate Competition Indexes for the 50 largest cities in the U.S. to assess how different markets behave across the country.

Source: LendingTree

Cross River Passes $ 600 Million in Monthly Loan Originations (The Public Opinion) Rated: AAA

Continuing its strong record of growth, Cross River, a leader in the emerging Fintech industry, announced today that it has set a new monthly loan origination record of more than $600 million in April.

Cross River’s April 2018 volume represents approximately 60% growth in loan origination from April 2017, and keeps Cross River on pace to exceed $7 billion in loan originations for 2018.

MoneyGram Seeks More Digital Gains In 2018 (PYMNTS) Rated: A

MoneyGram revenue declined 2 percent year over year in the first quarter, to $380 million. That was lower than analyst expectations of about $386 million. Net income declined 19 percent, to $7.1 million, with earnings per share at $0.15 per share — below analyst expectations of $0.26.

Moneygram.com, the digital business, posted a year-over-year revenue gain of 21 percent in the first quarter, with most credit going to customer acquisitions, the company said in its financial release. Digital revenue accounted for 16 percent of all money transfer revenue in the first quarter.

Credit Karma Partners with SpyCloud to Add Dark Web Data Monitoring (Finovate) Rated: A

Credit Karma has expanded its identity theft monitoring offering to include data from the dark web. Courtesy of a partnership with fellow Finovate alum – and Best of Show winner – SpyCloud, Credit Karma will dramatically increase the number of data breaches it is able to review for its 80 million users. Currently searching 4.5 billion public breaches, the new service will boost the total number of data breaches searched to 13 billion.

Data Sheet—Zillow’s Audacious House Flipping Plan Scares Wall Street (Fortune) Rated: A

Looking merely at the numbers, Zillow reported a fine quarter Monday. The Seattle company doesn’t make money. But it does grow quickly on top of a billion-dollar-plus annual-revenue clip. It is worth more than $10 billion and is the winner of its category, having absorbed competitor Trulia and outlasted others.

Yet Zillow isn’t satisfied. It is starting a new home-flipping business using its own balance sheet to buy, touch up, and sell homes. Wall Street hates the idea, wondering why a perfectly respectable online business would wade into the messy and highly variable world of investing real money in actual houses.

Fintech Companies Should Move On From The Millennials (Forbes) Rated: A

These days, for consumer fintech companies in wealth management (we will call them fintechs for short), it is, to paraphrase Meghan Trainor, all about the millennials. Fintech unicorns are courting millennials and garnering billion-dollar valuations for succeeding at it. The Robinhood is 28, and 78% are under 35. The average age of a Betterment customer is 35 and .  With three million accounts, Acorns has primarily a millennial customer base as well. However, if these companies and their millennial-chasing brethren are hoping to raise meaningful assets under management, it is time for them to move on from the millennials.

According to the , millennials today have just 4% of the nation’s wealth, compared to 50% for Baby Boomers and 33% for the Silent Generation.

3 Strategies To Help You Say “Bye, Felicia” To Student Loan Debt (Forbes) Rated: A

Goldman, Wells Fargo Look to Credit Cards for Bigger Returns (Bloomberg) Rated: A

Two of the biggest U.S. banks, Goldman Sachs Group Inc. and Wells Fargo & Co., are on the brink of piling into credit-card lending, seeking a share of the $183 billion in fees and interest tied to the product.

Making the Ask, Part 1: The Key to Entrepreneurial Success (Newswise) Rated: A

Professor Saras Sarasvathy, a renowned scholar of entrepreneurship at the University of Virginia Darden School of Business, has discovered that successful entrepreneurs are not only relentless “askers,” but they also have a repertoire of asks for different startup scenarios.

Rather than develop business plans to raise money, experienced entrepreneurs start with their means at hand — who they are, what they know and whom they know — exploring what they could do with those means. At the same time, they enlist others who want to work with them. Together, they iteratively co-create new products, ventures and markets. As more stakeholders self-select, committing their resources to the emergent ideas, the goals start to coalesce.

In the early stages of venture creation, effectual asks start as open-ended conversations.

SmartBiz Loans Adds Seacoast Bank to Technology Ecosystem (Business Wire) Rated: B

SmartBiz Loans today announced the addition of Seacoast Bank ( to the company’s unique technology ecosystem, taking the total number of banks on their platform to nine. SmartBiz Loans’ intelligent technology platform matches Florida-based Seacoast Bank to the right loan customers in a fraction of the time a referral typically can take, allowing the bank to originate SBA loans more efficiently while increasing the likelihood that small business owners get approved for funding.

 

With student debt levels reaching crisis proportions in the United States, Fidelity Investments announces significant response to its Student Debt Employer Contribution benefit, with 25 employers making plans to offer the Fidelity program and nearly 9,000 of their eligible employees expected to be enrolled in the program by the end of June.

 

 

 

 

 

 

 

 

 

 

United Kingdom

What are the benefits of IFIsas? (Bridging & Commercial) Rated: A

Over a third of UK savers (36%) would place their money in an IFIsa if they had the available funds, a new study has found.

The Next Gen: Investors and Savers report from P2P lending platform ArchOver found that 61% of respondents acknowledged the prospect of higher returns and better interest rates from an IFIsa.

However, over half (57%) claimed that they still didn’t fully understand the service.

China

Chinese Rural Fintech Firm Shenma Completes $ 47.3M Series C Round (Chinese Money Network) Rated: A

Shanghai-based Shenma Finance, a fintech company focused on rural mobility, has raised a RMB300 million (US$47.25 million) series C round led by China Growth Capital, Hina Group and Chinese fintech firm Tongbanjie Group.

Existing investors Credit Ease Financial Industry Investment Fund and ChinaEquity Group also participated in the round, the firm announced on its official WeChat account.

European Union

Riga-based fintech startup Mintos reaches profitability as it eyes global expansion (EU Startups) Rated: AAA

Three years after launch, the Riga-based fintech startup Mintos has turned an annual profit for the first time. The company’s revenue increased more than four-fold in 2017 to over €2.1 million and net profit for 2017 was €197K.

In more than three years since its establishment, Mintos has exceeded €660 million in cumulative investments by investors and the company expects the amount of loans funded to reach €1 billion by the end of the year.

Swedish fintech group iZettle to seek $ 1.1bn valuation in IPO (Financial Times) Rated: AAA

Some of the biggest names in payments, including Mastercard, American Express and Santander, have invested in iZettle, as have venture capital firms including Index Ventures and Dawn Capital.

International

ArthaCoin ICO (ATH Token): Long Term Crypto Lending Program? (Bitcoin Exchange Guide) Rated: A

Arthacoin is a sustainable investment-lending platform that aims at providing prosperity and guaranteed returns to its investors. Arthacoin is viewed as an alternative investment, which uses different investment methods to ensure investors get active returns using their collected funds. The platform purposes to create returns by use of derivatives and leverage in cryptocurrencies.

Besides, it is a self-managed financial system, which supports peer-to-peer transactions with a basis on the open-source platform. Arthacoin is built with a vision of creating a regular passive and sustainable income in the end for its investors.

What’s The Difference Between Trading Crypto VS. Lending Crypto (Finsmes) Rated: A

When it comes to investing in cryptocurrencies, the most common way to invest is by trading. Cryptocurrencies have revolutionized how we do business, make investments and raise funds. Some would even call blockchain technology the invention that would shape the 21st century. Trading cryptocurrencies is a fast and easy way to profit and can be interesting too.

But there is also another way to earn profits from cryptocurrencies and make your money work for you – crypto lending.

Let’s take a look at both crypto trading and crypto lending.

Crypto lending is a relatively newer way to earn profits. It revolves around the concept of shorting.

Australia

Do You Still Only Have One Bank Account? Here’s How Many You Should Have By Now (MyDomaine) Rated: A

If you’re living from pay cheque to pay cheque and can’t seem to break the cycle, chances are you’re not alone, dear millennial. In fact, it may not have even been bad shopping habits that landed you here. Whether it’s an underpaying job, or a weekly rent payment that is far from sensible, in the words of financial adviser, from Honest Money, Jacqui Park: “There’s no time like the present” to stop spending frivolously and start saving. But before you downsize, start a side-hustle, or, cut up the credit cards; it’s worth noting the basics of saving, so when you do decide to forgo life’s little luxuries you are able to make the most of it.

India

BigWin Infotech gets P2P lending licence (The Economic Times) Rated: AAA

Online lending platform BigWin Infotech has received an in-principle approval from RBI to start peer-to-peer lending operation as a non-banking finance company.

The company claims to be the first among all the P2P applicants to have received the licence and is planning to commence operations under the brand name of Paisadukaan.

The Future Of Credit Is Here (Businessworld) Rated: AAA

Fintech companies have netted the lower-middle income consumers who have, until now, been ill-served by banks as far as credit is concerned and have had to resort to gold loans or source other types of collateral. The lending landscape has transformed in the recent times with a host of startups that provide direct and simple credit for consumers. These companies broadly offer two types of products: Cash credit from companies such as Walnut & PaySense, that can be used for any purpose.

EMI loans to purchase electronics or white goods from companies like Zest Money or Kissht competing against industry giants such as Bajaj Finance. Then there are companies like MoneyTap that provide a flexible hybrid product that is an app-based credit line.

Fintech startups that provide credit to SMEs include CapitalFloat, KredX, LendingKart, NeoGrowth, Indifi and others.

P2P loan marketplace Finzy wants to change how India sees lending (Your Story) Rated: A

The rules of investment have changed over the years. First it was traditional methods like saving with fixed deposits, and then came insurance and stock markets.

However, the rules have changed yet again, and peer-to-peer lending is being viewed as an investment avenue that is expected to give returns to the tune of 18-22 percent, according to industry estimates.

According to the company, the rate of return for investing in Finzy is 15.5 percent for investors.

 

Latin America

Ripio CEO: Reinventing P2P Lending With The Blockchain (PTMNTS) Rated: A

Ripio has had more than one name in its evolution as a firm – but only a single goal. Originally known as BitPagos at launch, and then rebranding to Ripio in advance of its late 2017 ICO – the Argentina-based firm wants to use the blockchain to unlock the power of P2P lendingon a global scale.

The problem with traditional credit systems, according to Ripio, is that when it comes to access, geography is more or less destiny in many cases.

Canada

Fintech company TransferWise to launch borderless debit card in Canada in 2019 (Financial Post) Rated: AAA

European financial technology company TransferWise is planning a Canadian launch next year for its borderless debit MasterCard, which allows users to hold and spend a balance in multiple currencies with lower fees than traditional banks.

Kaarmann says there would be no transaction fees for people making purchases on the borderless debit card in the currency a balance is held in.

Authors:

George Popescu
Allen Taylor

Monday February 26 2018, Daily News Digest

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News Comments Today’s main news: Revolut breaks even, prepares for global expansion. RateSetter finances divorces. Which Isas pay 6% or more. Half of all employers offer financial advice. CoAssets increases revenue by 471% in half a year. Today’s main analysis: Do Americans really want a bank branch? Today’s thought-provoking articles: Ron Suber, Godfather of Fintech. Unscrupulous banks fueled the rise […]

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United Kingdom

China

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International

Australia

India

APAC

Africa

News Summary

United States

How Helping Your Employees Improve Their Credit Helps Your Bottom Line (Forbes), Rated: AAA

One possible cause of an employee’s poor attitude is that he or she has looming debts or is attempting to climb out of a credit score canyon. Workers facing these challenges are often unable to completely focus on their job responsibilities. It’s no surprise that constant stress over meeting financial obligations leads to a loss of focus and time dedicated to work obligations. And because employees work for paychecks that go toward their debts, it makes sense that they begin to associate the two.

Defeating Debt-Fatigue

About 

Giving the middle class credit: New bill a step in right direction (The Hill), Rated: A

Consumers need access to credit, and bank-fintech partnerships are one way to meet their needs. Indeed, bank-fintech partnerships are good for both consumers and banks.

As I noted, consumers benefit because banks can use fintech to deliver safer, more transparent, lower-cost and more convenient financial products and services over the internet and mobile devices.

Banks benefit because fintech companies can leverage big data and technology, offering the infrastructure banks need to serve and welcome more people into the financial system.

An excellent example of community banks using fintech to compete with the Wall Street banks is Radius Bank, a $1-billion asset institution in Boston, which according to news reports is establishing “long-term relationships” with fintech providers, and is finding them to be “mutually beneficial.”

Ron Suber, the Godfather of Fintech (Lend Academy), Rated: AAA

In this podcast you will learn:

  • Ron’s background and how he became interested in marketplace lending.
  • Why he saw a big opportunity for Prosper back in 2012.
  • What was behind Ron’s decision to leave Prosper last year.
  • What rewirement means to Ron and why it is important.
  • How the typical work week looks today for Ron.
  • Highlights of some of the trips he has taken recently.
  • What it was like doing the road show for the Credible IPO in Australia.
  • Details of the meeting Ron recently had with the Australian Treasurer.
  • What Ron is doing at Prosper these days.
  • Knowing what he knows now, what he would have done differently at Prosper.
  • What the marketplace lending industry still needs to improve upon today.
  • What inning the industry is in today.
  • What Ron looks for when he considers a new investment.
  • Why he pulled the trigger on some of his recent investments.
  • Ron’s view on Marcus and its impact on the online lending space.
  • What area of fintech Ron is most excited about today.
  • How he is able to maintain so many connections in fintech.
  • What is next for Ron Suber.

 

Chris Larsen Of Ripple (XRP) @Google (ValueWalk), Rated: A

Fed Minutes (PeerIQ), Rated: A

The Fed released the minutes of the January FOMC meeting and provided a bullish outlook to the economy with upside risks due to tax reform. The committee indicated that they were on track to raise interest rates in the March meeting, and market participants are expecting 3 rate hikes in 2018.

Meritize Raises $ 6.8M in Seed Funding (Finsmes), Rated: A

Meritize, a Frisco, Texas-based student lending platform, raised $6.8M in seed funding.

Colchis Capital, Chicago Ventures and Cube Financial Holdings led the investment round with participation from ECMC, College Loan Corporation, University Ventures, City Light Capital, PC Squared and Meritize management.

LendingPoint Co-founder Weighs in on Lending Club’s Earnings Report (deBanked), Rated: B

“In my view, [Lending Club’s] underlying problem is that they don’t have alignment of interest between their stakeholders,” Tavares said. “At LendingPoint, we have a different approach. We look at it really as a balance sheet model, which means that we put everything on our books. We use our own equity. We leverage other investors’ capital, but we’re not an origination platform…Lending Club’s model primarily is that they have to continue feeding the beast, so to speak, in order to continue making their revenues. They don’t have inventory to continue generating assets or to monetize going forward. That’s a significant shortcoming in their model,” he said.

Bay Area Man’s Opportunity Fund Giving Small Businesses A Leg Up (CBS Local), Rated: A

About 8,000 small business loans are denied every day in this country, according to the U.S. Federal Reserve. It’s a story Alicia Villanueva knows all too well.

So in 1992, Weaver founded Opportunity Fund, launched with a consortium of 15 banks. But although the San Jose-based non-profit works with traditional lenders, its business practices are a bit different. Weaver says Opportunity Fund delves into an applicant’s financial picture and character.  And since it lends to people with bad or non-existent credit, a granted loan comes with an automatic offer of hands-on financial management support, and a hefty dose of financial responsibility.

Today, Opportunity Fund loans about $5 to $7 million a month to small business owners in California and 13 other states. The money comes from business and private donations. An average loan can range from $2,600 to $250,000. Under Weaver’s leadership, 6,200 businesses have received loans.

Opportunity Fund, along with other partners like Lending Club, is set to expand into other parts of the U.S. later this year.

A Look at CUneXus’ Strong Growth in 2017 (Finovate), Rated: A

Lending automation company CUneXus published some impressive growth stats today. Here’s a quick overview of a few of the California-based company’s success metrics:

  • Grew from 45 FI clients to 72 over the course of one year, from 2016 to 2017, a 60% year-over-year increase
  • Reaches more than 6.5 million potential end consumers across the U.S.
  • Averaging more than $6 million in new loan requests per day
  • Generated more than 140,000 loans totaling more than $2.5 billion with its 1-click borrowing solution

These and other FI clients have reported that CUneXus has helped contribute to their own success, including:

  • Loan processing times cut in half
  • A 110% increase in pre-approved lending activity
  • A 135% spike in funded loan amounts

3 Ways Technology is Bringing in New Real Estate Investors (Realty Biz News), Rated: A

Today, in addition to teaming up with development companies, many investors are using technology solutions to research options remotely. Here are the three trending ways technology is revolutionizing how new investors step into the real estate market space.

Mobile apps like Vacation Rentals by Owner (VRBO) and Airbnb have become popular and more people are now looking to invest in such short-term rentals.

Big data is now a critical offering for the public, and the real estate niche is looking for ways of gathering and presenting the information for driving purchase behavior.

Following the success of the customer-centric applications, it’s clear to see that the industry holds a huge potential if technology is leveraged to bring in new investors. Real estate is the largest global economy asset with figures hinting at $217 trillion – surpassing the world’s GDP of $80 trillion! This is a clear indicator that there is a huge potential for financial freedom creating entrepreneurs looking to tap into the real estate market.

New York Federal Reserve: Fintech Has Improved the Mortgage Lending Market (Crowdfund Insider), Rated: A

The New York Federal Reserve has published a staff report pertaining to “The Role of Technology in Mortgage Lending”.

While still relatively small, this segment of onlien lending has grown annually by 30% from $34 billion of total originations in 2010 or 2% of the market, to $161 billion in 2016 or 8% of the market.

The Fed research finds that Fintech lenders reduce mortgage processing time by about 10 days, or 20% of the average processing time.

Additionally, default rates tank by a whopping 25% indicating the credit process is superior to the antiquated analog method of traditional banks.

 

 

Do the Majority of Americans Really ‘Want’ to Use a Branch? (The Financial Brand), Rated: AAA

According to research conducted by Novantas, 60% of Americans said they would rather open a new checking account in person at a bank branch than on a phone, tablet or desktop computer. Reinforcing this finding is the reality that most consumers still only use digital channels for the most basic banking functions, such as checking account balances and transferring funds. For more complicated issues, like problems with an account or advice, most consumers prefer human contact.

The reliance on branches in North America is almost double other countries, where better digital offerings have been introduced. In fact, according to Novantas, 75% of consumers in Australia report visiting the branch less than once per month, or even less! The UK is very similar while, interestingly, only about half of US consumers exhibit the same behavior.


The banking industry has seen the closure of 1,700 branches in the 12 months ending in June 2017 – the largest one-year decline on record. Capital One Financial Corp. has cut 32% of its branches from mid-2012 to mid-2017, while SunTrust Banks Inc. cut 22% and Regions Financial Corp. has cut 12%.

U.S. Bank Offers New Online Tool to Help Consumers Get Fast, Convenient Car Loan Approvals (BusinessWire), Rated: A

Working with financial technology startup AutoGravity, U.S Bank created a new platform on USBank.com that provides a simplified, streamlined loan application process for users that typically takes just minutes to receive a loan decision.

Car buyers using the new U.S. Bank tool simply:

1) Pick their car and select a dealership online

2) Apply for a pre-approval for a U.S. Bank loan online

3) Close the loan at the dealership and drive off in their new car

When Weak Bank Lending Is a Good Sign (WSJ), Rated: A

Total commercial and industrial loans extended by U.S. banks were up just 1% from a year earlier on Feb. 7, according to weekly Federal Reserve data. For the month of January, C&I loans were down an annualized 10.8% compared to December, according to calculations by Keefe, Bruyette and Woods.

Asked how demand for loans has changed over the past three months from large and medium-sized firms, 84% said it was “about the same” or “somewhat stronger,” while just 16% said it was “moderately weaker.” For small firms with annual sales of less than $50 million, 88% of bankers said loan demand was about the same or better, while only 12% said it was weaker.

Financial incumbents are starting to care about financial education (Tearsheet), Rated: A

On Wednesday, Greenlight Financial Technology — the creator of a smart debit card for kids, teens, and college students — closed $16 million in a Series A funding round. Its investors went beyond your traditional venture capital firm, including a disparate coalition of  financial services bigwigs like SunTrust Bank and Ally Financial as well as the Amazon Alexa Fund, among other VCs. Greenlight, whose mission is to help strengthen financial literacy among kids and give parents a platform to raise “financially smart kids,” will use the new funds to develop its products.

That coalition of Greenlight partners signals a renewed understanding of the reality of most Americans’ financial lives — 57 percent of Americans are financially unhealthy according to the Center for Financial Services Innovation — by legacy financial services companies coming to terms with the fact that they need to be in the business of financial health in order to keep customer relationships in tact over the long term.

Don’t be THAT credit union. Offer short-term loans to your members. (CUInsight), Rated: B

CashPlease is an innovative new short-term, small-dollar loan solution that allows credit unions to implement a consumer loan product efficiently and compliantly.  Here’s how:

  • No additional loan officers or other additional staff needed
  • Underwriting technology that is automated and proven
  • Assistance with compliance best practices
  • Data-driven marketing to educate consumers about the availability of lower-cost loans

ATTORNEY GENERAL HERRING OBTAINS FULL RESTITUTION FOR CUSTOMERS OF ONLINE LENDER (Virginia.gov), Rated: A

Attorney General Mark Herring announced today that his office has reached a settlement with eight affiliated online lenders and debt collectors to resolve allegations that the companies offered unlawful open-ended credit plan loans and engaged in unlawful debt collection practices including contacting borrowers’ employers and implementing wage garnishments. As a result of the settlement, borrowers will receive nearly $150,000 in restitution and forgiven debt.

The settlement includes the following key terms relating to loans made by the lenders during the period from January 2015 through June 19, 2017:

  • The Lenders agree to refund all interest and fees paid by consumers in excess of 12% of the loan amount, totaling approximately $85,000;
  • The Lenders agree to forgive all outstanding remaining debt of Virginia consumers, totaling over $63,000;
  • The Lenders agree to a permanent injunction against consumer lending activity in Virginia;
  • The Debt Collectors agree to a permanent injunction against all debt collection activity in Virginia;
  • The Lenders agree to pay $10,000 in civil penalties and $10,000 in attorneys’ fees;
  • The Debt Collectors agree to pay $75,000 in civil penalties and $10,000 in attorneys’ fees.

The companies include six lenders (Field Asset Service Team, LLC; VIM Holdings, LLC; MR Capital Group, LLC; Nascent Holdings, LLC; B Financial, LLC; and DTS Capital, LLC, collectively “the Lenders”) and two debt collectors (Bradley Goldberg & Miller, LLC and U Solutions Group, LLC, “the Debt Collectors”) that acted in concert to provide and collect open-end credit plan loans made over the Internet to Virginia consumers.

The Lenders offered open-end credit plan loans and imposed “service fees” as high as $160 per month. The Debt Collectors then emailed consumers in an effort to collect on these loans and contacted the consumers’ employers to implement wage assignments and collect money directly from the consumers’ paychecks.

CFPB Drops Lawsuit Against Payday Lender (JD Supra), Rated: B

The CFPB has dropped a recent lawsuit against a payday lender accused of charging up to 950% interest.

The case is CFPB v. Golden Valley Lending, Inc., et al., Case No. 17-cv-02521 (District of Kansas).

United Kingdom

Difficult divorce? RateSetter can help (P2P Finance News), Rated: AAA

The ‘big three’ peer-to-peer lender has been offering a family finance product for a number of months, whereby individuals can apply for a loan to pay for their divorce litigation.

The P2P platform offers personal loans ranging from £500 to £35,000, with terms between one year and five years, according to its website. Borrower rates range from 3.9 per cent to 29.9 per cent.

Unscrupulous banks have fuelled rise of alternative lenders (RealBusiness), Rated: AAA

Now it emerges that one bank was actively working against small businesses in its greed-fuelled quest for profits and bonuses. RBS has been exposed for making up fees, imposing punishingly high interest rates, acquiring equity and property from failed businesses – and pocketing huge bonuses off the back of it.

As a result, it is alternative lenders that are now the go-to for independent businesses in need of assistance when it comes to growth. Take, for example, the business cash advance, which is sometimes referred to as a merchant cash advance. This funding can be from as little as £500 up to £300,000 and is advanced to the business against future credit and debit card turnover.

These Isas pay 6% and more – but should you invest? (Which?), Rated: AAA

Last week, Ratesetter launched an Isa paying a top rate of 5.8%, while yesterday (24 February), Easyjet founder Stelios Haji-Ioannou launched an tax-free account aiming to pay 4.05% per year.

Other innovative finance Isas are currently paying returns as high as 16% a year.

Zopa is currently paying between 4% and 4.6%. Zopa primarily lends to individuals, Ratesetter lends to both individuals and businesses whereas Funding Circle lends exclusively to small businesses. The latter’s innovative finance Isa is only available to existing customers, but is projecting an annual return of 7.5%.

EasyMoney launches Innovative Finance ISA (P2P Finance News), Rated: A

EASYMONEY, part of Sir Stelios Haji-Ioannou’s ‘easy’ family of brands, has launched in the UK with an Innovative Finance ISA (IFISA) offering a target rate of 4.05 per cent a year.

Jacob Rothschild-backed firm plans £100m float (Professional Adviser), Rated: A

Augmentum Fintech, which is preparing to float next month, has unveiled plans to issue a target of 100 million ordinary shares at a price of £1 each, with a maximum issue size of 125 million shares.

FCA seeks feedback on its ideas for a global sandbox (Mondaq), Rated: A

The FCA’s new webpage contains its ideas for a global sandbox [14.02.02]. Its current sandbox only allows firms to test their ideas in the UK.

It highlights three areas:

  • addressing “pre-identified challenges” in areas known for “regulatory problems that cross jurisdictional boundaries” e.g. AML and KYC on-boarding.;
  • enabling firms wishing to expand in different markets to “bring their ideas to market more quickly and easily, creating more effective competition.” The FCA asks for firms who could benefit from testing out their ideas in a number of markets to get in touch; and
  • policy and regulatory challenges – the FCA suggests the sandbox could be used to convene “joint events and papers on emerging trends and challenges” using the experiences of the range of firms and regulators taking part to develop “consistent approaches”.

Brexit to shut the door on lengthy London house price boom (Euronews), Rated: A

British inflation will outstrip gains in house prices this year and next, particularly in the capital, as uncertainty over Brexit and weak consumer spending power hits demand, a Reuters poll found on Friday.

Next year, house prices will rise 0.9 percent in London and 2.0 nationally, still both below the 2.1 percent expected inflation rate. In 2020, London prices will increase 2.0 percent and by 2.3 percent nationally.

“Quite simply, with loan-to-income ratios for first time buyers sitting at around four times, average salaries of 33,000 pounds ($46,000), and your average flat in London costing over 500,000 pounds, it’s extremely difficult to see how London can be viewed as anything but very expensive,” LendInvest’s Lockhart said.

China

Hang Seng Bank deploys fintech to simplify mobile banking, mulls use of facial recognition at ATMs (SCMP), Rated: A

Hang Seng Bank plans to expand the use of fintech to mobile banking services and is also toying with the idea of incorporating facial recognition, after initial success with iPhone X, to allow customers to withdraw cash from its ATMs across the city, according to its chief executive.

The global facial recognition market is forecast to be worth US$6.5 billion by 2021, up from US$2.3 billion in 2016, according to estimates from research company Technavio.

European Union

Klarna Bank AB appoints Niklas Savander to Board of Directors (LeapRate), Rated: B

Klarna Bank AB has announce the appointment of Niklas Savander to the Board of Directors with effect from Thursday 22nd of February 2018. Niklas Savander will replace Niklas Adalberth.

International

Digital banking start-up Revolut breaks even as it prepares global expansion (CNBC), Rated: AAA

Revolut said Monday that it had broken even for the first time in December, and that its monthly transaction volume surged to $1.5 billion, an increase of over 700 percent in the last 12 months.

The start-up has signed up a total of 1.5 million users to its mobile app, up 50 percent from a figure it achieved in November.

Cryptocurrency A Risk Factor, Bank Of America Says In Annual SEC Filing (International Business Times), Rated: A

The 10-K filing referred to cryptocurrencies, without naming any specific one, three times under a subsection titled “Risk Factors” and described three different ways in which they could pose problems for the bank’s business.

The first reference was under geopolitical risks, with the bank talking about international money-laundering.

The third reference was along similar lines, with BoA saying: “The widespread adoption of new technologies, including internet services, cryptocurrencies and payment systems, could require substantial expenditures to modify or adapt our existing products and services as we grow and develop our internet banking and mobile banking channel strategies in addition to remote connectivity solutions,” adding it “might not be successful in developing or introducing” competing products at lower prices.

 

Australia

SPOTCAP AWARDS SCHOLARSHIP TO ASPIRING FINTECH ENTREPRENEUR (Global Banking & Finance), Rated: A

Spotcap today announced Vishal Uppal as the winner ofthe Fintech Scholarship 2017. The first of its kind in Australia, the scholarship awards one aspiring graduate with an interest in fintech $10,000 towards the cost of their tuition.

India

Guide to smart banking: Why P2P lending is an ‘interest’ing idea (Business Line), Rated: AAA

P2P lending, on the other hand, is a completely tech-driven investment, which gives a net annualised return of 18-22 per cent to lenders, who start earning their principal and interest back from the very first month. The returns are higher because you can lend directly to the borrower and the intermediary costs are drastically reduced.

A majority of investors on these platforms are salaried professionals aged between 20 and 35 years looking for additional sources of income.

On Faircent.com lenders can invest as low as 750 per loan size or choose tech-enabled processes like auto-invest to save time. These features are a major attraction for millennials and, in fact, according to the last Research and Analytics report on P2P lending published by Faircent.com, 64 per cent of lenders are below 35 years of age.

Retirement plan: How real estate investment can help millennials secure their future (Financial Express), Rated: A

A growing number of millennials are also opting for investments into commercial real estate, as opposed to investments into residential properties made by their parents.

Commercial real estate: better yields for better financial security

Leases on these properties are usually taken out for multiple years by blue-chip companies, thus ensuring that steady rental income is assured for a specific duration of time. With India’s rise as a prominent international business destination, the sector is also witnessing remarkable growth; the country’s 537 million square feet of rent-generating commercial real estate inventory is currently estimated to be worth nearly $70 billion.

How technology is enabling millennials to make high-value real estate investments

The investments can start as low as Rs 5 lakh, making the entire process extremely affordable for millennial buyers whilst also allowing them to make multiple investments to diversify their portfolio, increase rental incomes, and minimise risk. Average rental returns to the tune of 7%-8% are quite common, while the overall returns can be as high as 22%.

India is projected to become the youngest country in the world by 2020, with a median age of 29.

Movers And Shakers Of The Week [19-24 Feb 2018] (Inc42), Rated: B

BigWin Infotech, a government recognized fintech startup has appointed Suneel Mohnot a the Director on its board.

BigWin Infotech is a self-funded startup who has recently forayed into P2P lending business through its solely owned market place PaisaDukan.com post revised RBI guidelines for NBFC-P2P and one of the strong contenders for NBFC-P2P license.

APAC

CoAssets Reports Half-Year Results With 471% Increase In Revenue (AsiaOne), Rated: AAA

CoAssets Limited (“CoAssets” or the “Group”) (ASX: CA8), a leading crowdfunding platform and Fintech lender specialising in facilitating funding for businesses reported its financial and operating results for the half year ended 31 December 2017, together with an update on the Group’s growth and capital strategy to the Australian Securities Exchange (ASX) on 22 February 2018.

Total reported revenue increased by 471% from S$446,040 in 2016 to S$2,547,554 in 2017. Group’s profits in year 2017 was S$2,046,013, from a loss of S$3,899,325 in 2016. This increase in profits was due to business activities as well as investment gains. Operating expenses decreased from S$3,570,287 in 2016 to S$2,577,013 in 2017. This represents about S$1million or 28% in cost savings. Registered investor base reached 433,805 as at 31 December 2017. This represents an 88.17% increase from 30 June 2017.

Singapore — CoAssets Pte Ltd (“CAPL”)

After receiving the Capital Market Services (CMS) licence from the Monetary Authority of Singapore (MAS) in June 2017, the company crowdfunded more than S$5.11million worth of deals from 1 July 2017 to 31 December 2017.

Singapore — CoAssets International Pte Ltd (“CAI”)

The company disbursed more than S$6.65million worth of loans over the last 6-months, with its loan book growing to more than S$16.21million as at 31 December 2017.

China — CoAssets China

This represents the Group’s fastest growing market, achieving remarkable growth in registered user base of more than 117% (from 173,000 to more than 375,000 members) from 1 July 2017 to 31 December 2017. The CoAssets platform in China funded more than RMB28.15million (S$5.94million) worth of crowdfunding projects over the last 6-months in 2017.

Hong Kong — Fintech Pte Ltd

In April 2017, the Group acquired Fintech Pte Ltd, an online corporate cash management platform called “PiggieBank ” in Hong Kong.  Since then, PiggieBank has successfully managed funds flow of more than S$21. 39million as at 9 February 2018.

Hong Kong — Brighten Finance Limited (“BFL”)

As at 31 December 2017, BFL’s loan book was worth HK$36.91million (S$6.27million).

EF, KoinWorks Serve Online Loans for Courses (netral english), Rated: A

English First, an English Education Institute signed a joint venture with KoinWorks – a Indonesian Peer to Peer Lending Platform – that serves investments and online loans without collateral for various productive loans.

Africa

Blockchain and financial services disruption (Punch), Rated: AAA

Key areas of the financial services that are most likely to be affected by blockchain include transfers, payment and lending. We have seen different start-ups such as OneFi, Inspire, Upstart, and Funding Circle, playing critical roles in peer- to -peer lending and services to individuals.

The closest we have seen so far is what VoguePay, a leading online payment start-up, has done.

It recently launched a multi-currency payment platform to enable businesses to send and receive payment from local and international customers, allowing merchants to accept payment in dollars, Euros, Rands, Cedis, Naira and Bitcoin payment.

The average Nigerian bank pays about five per cent interest rate on fixed deposits while requesting for two-digit interest rates on loans from customers. Economically, this does not make much sense because the margin is too wide when compared to what they offer for holding customers’ fund. Many people are tired of the highly monopolistic nature of banking.

Authors:

George Popescu
Allen Taylor