- Today’s main news: Affirm debuts shopping app. Zopa profits tick upward. RateSetter recovering from loan scandal. PPDAI stock rises 7% with lift in institutional-funded loans. Oportun ends Nasdaq debut with 8% gain. Australia: RBA cuts interest rates, online lenders follow.
- Today’s main analysis: The Future of Finance: Marcus, Neobank, and fintech. (A MUST-READ)
- Today’s thought-provoking articles: Peter Renton’s quarterly marketplace lending results. Loans for sneakers. Lessons learned from LendIt Fintech Europe. What’s happening in fintech worldwide.
- Affirm debuts new app for shoppers. The app allows consumers to shop and check out with “virtually any retailer.” This Business Insider article highlights Affirm’s need to step up its game in order to compete with Amazon, 66 percent of whose customers begin their search for new product at Amazon. Affirm will have to offer better deals for consumers and make it easy to purchase things. With Affirm’s relationship with Walmart, that shouldn’t be too much of a challenge. However, it will be a challenge.
- Affirm app allows for bill splitting.
- Interview with Max Levchin, founder and CEO of Affirm.
- OnDeck survey indicates small businesses are concerned about economy. Old news, still interesting.
- Marcus, jobs, the economy, housing prices, and Oportun. From PeerIQ, well worth the read.
- Peter Renton’s quarterly MPL results. For Q2 2019. Always interesting to read how Renton’s investments have been doing. With lots of charts.
- The rose of “loans for sneakers” as a business. The focus is on Afterpay, an Affirm competitor, but this is a good read because it tackles POS lending from a consumer’s perspective. Insightful and interesting.
- What happened to Borro?
- Auto, home equity are soft spots in consumer lending.
- Maker offers multi-collateral DAI lending.
- A $40 billion pile of leveraged loans battered by huge losses.
- CFPB ruling shorts debt collectors.
- The SEC is hiring a data chief.
- Voyager selects Celsius Network for asset management.
- Zopa’s profits tick upward.
- Zopa says 9 out of 10 shoppers are confused by car finance options.
- RateSetter recovering from loan scandal.
- Wonga customers average 118 GBP payout.
- Savvy secures 20 million GBP funding facility.
- Interview with founder of Blend Network.
- Crowdfunding options for startups explained.
- Lessons learned from LendIt Fintech Europe.
- Linked Finance launches ‘Beyond Brexit’ business loans.
- ID Finance to double revenues within two years.
- Binance launches next phase of crypto lending program.
- What’s happening in the fintech revolution worldwide. A great read with interesting charts.
- Marcus, Neobank, and fintech developments. This is today’s must-read. Very detailed with lots of charts, but the focus is mostly on digital banking. Still, a very good read.
- Blockchain: The future of finance.
- China: PPDAI stock soars 7% on institutional-funding lending increase.
- Australia: RBA cuts rates. Online lenders do too.
- Australia: loans.com.au cuts rates.
- Bahrain: Beehive funds first SME.
- Malaysia: The risks and rewards of SPV 2030.
- Australia: OnDeck appoints national broker chief.
- Canada: BFS Capital opens data science and engineering hub in Toronto.
- United States
- OnDeck Survey: Economy is Top Concern for Small Businesses Ahead of 2020 Election (New Kerala), Rated: AAA
- Affirm debuted a new app encouraging customers to start their shopping journeys with it (Business Insider), Rated: AAA
- Affirm ships new shopping and bill splitting app (Finextra), Rated: A
- Max Levchin On The Future-Present Of Everywhere POS Lending (PYMNTS), Rated: A
- Latest Macro; latest from Marcus; Oportun goes IPO (PeerIQ), Rated: AAA
- My Quarterly Marketplace Lending Results – Q2 2019 (Lend Academy), Rated: AAA
- The Maybe-Dubious Rise of the Loans-for-Sneaker Business (GQ), Rated: AAA
- What Happened to Borro? (deBanked), Rated: A
- Auto, home equity are soft spots in consumer lending (American Banker), Rated: A
- Finally! Maker Offers Multi-Collateral DAI Lending (Cryptovest), Rated: A
- A $ 40 Billion Pile of Leveraged Loans Is Battered by Big Losses (Bloomberg), Rated: A
- Ruling cuts short debt collectors’ victory lap over CFPB proposal (American Banker), Rated: B
- The SEC is hiring a chief data officer (Business Insider), Rated: B
- Voyager Selects Celsius Network to Manage Certain Assets (AP News), Rated: B
- United Kingdom
- Zopa’s P2P profits tick up but group losses widen due to heavy investment in bank (P2P Finance News), Rated: AAA
- Zopa: nine in 10 shoppers confused by car finance options (Verdict), Rated: A
- Ratesetter recovering from loan scandal (The Times), Rated: AAA
- Wonga customers’ average compensation payout may be just £118 (The Guardian), Rated: A
- Payday loan alternative Savvy secures £20 million funding facility (Finextra), Rated: A
- MEET THE FRENCHMAN WHO WANTS TO SOLVE THE UK’S HOUSING CRISIS (Business Leader), Rated: A
- Crowdfunding a start up options explained for businesses and investors (What Investment), Rated: A
- Landlords wary of tax changes (Money International), Rated: A
- PPDAI Stock Soars 7% on Increase in Institutionally-Funded Loans (Capital Watch), Rated: AAA
- European Union
- What we learned at this year’s LendIt Fintech Europe (Business Insider), Rated: AAA
- Linked Finance launches ‘Beyond Brexit’ business loans (Bridging and Commercial), Rated: A
- ID on track to double revenues as it eyes €300m+ of revenue within 2 years (Fintech Finance), Rated: A
- Binance Launches New Lending Program Phase (CoinCodex), Rated: A
- A Guide to What’s Happening in the Fintech Revolution (Bloomberg), Rated: AAA
- Goldman’s $ 1.3B Marcus burn, Neobank £200MM loss; plus 14 short takes on top developments (Lex), Rated: AAA
- Blockchain: the future of finance (Financier Worldwide), Rated: A
- Hot home loan rates starting with a 2 (mozo), Rated: AAA
- loans.com.au jumps on October RBA home loan rate cut party (mozo), Rated: AAA
- OnDeck appoints Robbie Fidler as new national broker chief (IT Wire), Rated: B
- SPV 2030: Sharing of risks and reward (The Malaysian Reserve), Rated: A
- Beehive funds first SME in Bahrain (Arabian Business), Rated: AAA
- BFS Capital Opens New Data Science and Engineering Hub in Toronto (Financial Post), Rated: B
OnDeck Survey: Economy is Top Concern for Small Businesses Ahead of 2020 Election (New Kerala), Rated: AAA
OnDeck today announced the results of a national survey of U.S. small business owners that finds economic issues are the most important factors in determining their choice for president in 2020.
- Economic concerns arise in several dimensions, including tax policy, job growth, support for small businesses, government spending and the overall economic climate. These issues were cited as the top concerns of more than 33% of those surveyed;
- Immigration was an issue of interest for 11.3% of small business owners surveyed, ranking second behind the economy as a concern.
- 57% of small businesses surveyed said they were either Very Optimistic or Somewhat Optimistic about the economic outlook for their businesses;
- 93% of those surveyed said they plan to vote in the 2020 election.
- 60% of small business owners surveyed said they already know who they plan to vote for in the 2020 presidential election.
Affirm debuted a new app encouraging customers to start their shopping journeys with it (Business Insider), Rated: AAA
The point-of-sale (POS) financing provider
Affirm ships new shopping and bill splitting app (Finextra), Rated: A
Affirm’s app also allows consumers to pay at any brick-and-mortar store that accepts Apple Pay or Google Pay, which is increasingly important as 24% of consumers want the flexibility to look online and shop in-store.
Those with Apple Pay or Google Pay enabled have also seen up to 14% of transactions driven in-store, making the Affirm app a rare omnichannel solution for customer acquisition.
Max Levchin On The Future-Present Of Everywhere POS Lending (PYMNTS), Rated: A
Since Affirm’s launch, the landscape in the POS space is radically different than it was when Affirm entered. It is, first and foremost, a much bigger and more populated space than it once was. Other startups have come to the field — Afterpay, Uplift and Sezzle for example — but also bigger and more established names in financial services. In the last 12 months alone Square, Mastercard, PayPal and Chase have all rolled out POS installment lending products or enhancements as the market continues to pick up popularity among consumers, particularly younger ones.
Latest Macro; latest from Marcus; Oportun goes IPO (PeerIQ), Rated: AAA
Q4 is off to a brisk start. The jobs report released this past Friday shows 114K in net new jobs (vs expectations of 120K), generally flat wages, and a drop in the unemployment rate to 3.5%.
On the one hand, the US economy is near ‘stall speed’ – around 1 to 1.5% growth rate.
House prices are expected to rise 5.8% over the next year due to low mortgage rates.
Two major financing announcements this week. FinTech lender, Oportun, led by CEO Raul Vazquez, ends its Nasdaq debut with an 8% gain. The debut is notable as it represents a positive shift in the sentiment to the reception of lenders to the IPO market.
My Quarterly Marketplace Lending Results – Q2 2019 (Lend Academy), Rated: AAA
The upward trend in my returns continued in Q2, making it the fifth quarter in a row with increasing returns. My preliminary return for the 12 months ending June 30, 2019 is 6.20% (one investment is still not final), the best I have achieved since Q3 2017.
The Maybe-Dubious Rise of the Loans-for-Sneaker Business (GQ), Rated: AAA
Afterpay is one of a number of platforms that have sprouted up over the past couple years that are willing to float customers a couple hundred or thousand dollars to shop. In addition to it, there are Affirm, Sezzle, Klarna, and Quadpay. They are positioned as a more consumer-friendly option than credit cards, a whole host of services bent on—because this is 2019—disrupting the powers that be.
Globally, Afterpay, which launched in Australia, has over 4.6 million customers and 35,000 retail partners. In the U.S., where Afterpay only launched in May of last year, it has two million customers and is available at 6,500 retailers. Over three million people use Affirm, while another 500,000 have shopped with Sezzle.
Silicon Valley promises aside, Afterpay is, at best, a platform that allows you to take out what amounts to a small loan on an item. After an approval process—Afterpay does not check a credit score; others like Affirm do—the customer pays a fourth of the price upfront and the rest is paid off in three equal installments every two weeks.
Also new is the $1,500 limit, up from $500, that Afterpay raised after Hyde-McCormick proved himself a responsible shopper and the $87.50 payments currently due every two weeks.
What Happened to Borro? (deBanked), Rated: A
In 2013, Borro, an innovative online lending company that was poised to disrupt pawn shop lending forever, invited me to their stylish offices at 767 Third Avenue in Manhattan.
Borro made $50 million worth of such loans in 2013 and doubled that number in 2014.
Auto, home equity are soft spots in consumer lending (American Banker), Rated: A
In its quarterly report that tracks consumer delinquency trends, the American Bankers Association said that 30-day past-due rates ticked up in eight of 11 categories in the second quarter when compared with the first quarter, but stressed that delinquencies remain well below historic norms.
Finally! Maker Offers Multi-Collateral DAI Lending (Cryptovest), Rated: A
Maker DAO, the most active decentralized finance app on the Ethereum network, has announced a date for its long-awaited multi-collateral DAI generation. According to observers, November 18 may be the date MKR starts accepting other assets as collateral.
Multi-collateral DAI creation has the potential to be riskier in comparison to ETH-based models. Currently, Maker is deliberately over-collateralized at above 300%, with the minimum at 150%, due to the high volatility of crypto assets.
A $ 40 Billion Pile of Leveraged Loans Is Battered by Big Losses (Bloomberg), Rated: A
Loans tied to more than 50 companies have lost at least 10 percentage points of face value in just three months, according to data compiled by Bloomberg. Some have dropped a lot more, with lenders lucky to get back just two-thirds of their investment if they tried to sell.
Energy is the hardest-hit sector on the list, with more than $12 billion of loans falling more than 10 cents on the dollar. Consumer and health care follow, comprising around $8 billion and $5 billion of loans outstanding, respectively.
The SEC is hiring a chief data officer (Business Insider), Rated: B
The Securities and Exchange Commission is hiring its first chief data officer, according to a job posting for the role.
Voyager Selects Celsius Network to Manage Certain Assets (AP News), Rated: B
Voyager Digital, LLC, a subsidiary of publicly-traded Voyager Digital (Canada) Ltd (Ticker VYGR.CN), an industry-leading best execution crypto asset broker, today announced a partnership with Celsius Network, in which Celsius will manage a portion of Voyager’s digital assets.
Zopa’s P2P profits tick up but group losses widen due to heavy investment in bank (P2P Finance News), Rated: AAA
Zopa Group – which incorporates the P2P platform and upcoming digital bank – reported a pre-tax loss of £18.295m for the year ended 31 December 2018, compared to a pre-tax loss of £5.536m the previous year.
Zopa: nine in 10 shoppers confused by car finance options (Verdict), Rated: A
In a survey of 2,000 consumers, 47% of people who had recently bought a car with finance are unable to identify which type of finance deal they signed up for. Zopa estimates that the average car buyer could save up to £11,000 over the course of their lifetime by working out the best finance deal available.
Wonga customers’ average compensation payout may be just £118 (The Guardian), Rated: A
Customers who were mis-sold loans by the collapsed payday lender Wonga are expected to receive less than 10% of what they are owed in compensation after administrators revealed that only £41m will be put aside for claimants.
Payday loan alternative Savvy secures £20 million funding facility (Finextra), Rated: A
Stockport and Wilmslow based fintech company Savvy.co.uk is to create 25 jobs after securing a £20 million investment.
MEET THE FRENCHMAN WHO WANTS TO SOLVE THE UK’S HOUSING CRISIS (Business Leader), Rated: A
WHY DID YOU START BLEND NETWORK?
I started working in the financial industry as an FX trader before moving to trading gold and copper, both much more inefficient markets than FX. I realised that the UK property market was a hugely inefficient market in the sense that lenders and borrowers are not meeting. On the one hand, you have very experienced property developers across the country who are trying to access funds to build homes but traditional lenders are no longer active in providing development finance.
Instead, we lend in places such as Coventry, East Anglia, Doncaster, Northern Ireland. Northern Ireland is a very good example of our strategic approach to lending. Last year, we did around 80-85% of our business in Northern Ireland.
Crowdfunding a start up options explained for businesses and investors (What Investment), Rated: A
Crowdfunding a start up brings to mind the statement ‘Nothing worth having comes easy’, never truer than in the case of launching a start-up. Getting a new business off the ground will often require capital. Something which a lot of people don’t know how to go about getting.
- Reward based crowdfunding;
- Equity based crowdfunding;
- Debt based crowdfunding, and
- Donation based crowdfunding.
Landlords wary of tax changes (Money International), Rated: A
Half of the 200 landlords approached agreed tax changes and tougher mortgage borrowing criteria have thwarted their plans to buy more properties, while 15% admitted they had been put off buying homes to rent.
A third who still wanted to invest are considering a switch from buy to let to peer-to-peer lending secured against property, while 8% have already done so.
PPDAI Stock Soars 7% on Increase in Institutionally-Funded Loans (Capital Watch), Rated: AAA
The stock in PPDAI Group Inc (NYSE: PPDF) closed 7% higher on Wednesday, at $2.83 per American depositary share, after it announced a positive trend in funding of loans by its institutional partners and increased loan origination volume.
For the third quarter, the Shanghai-based company, which operates an online consumer finance marketplace, said in a statement on Wednesday that the volume of loans facilitated by its institutional funding partners jumped to $2.64 billion, up 91% from the second quarter. Total loan origination volume was above PPDAI’s guidance, it said, as it reached $3.51 billion, up 14% from the previous quarter.
What we learned at this year’s LendIt Fintech Europe (Business Insider), Rated: AAA
At the conference, Business Insider Intelligence identified four emerging themes that we expect to set the tone for the space for the next year: further proliferation of partnerships between banks and fintechs, increased focus on digital banks’ sustainability, accelerated innovation and disruption from small- and medium-sized business (SMB) lenders, and more challenges ahead for the UK’s P2P lenders.
- CYBG bank and price comparison site GoCompare recently partnered to offer an energy compare and switch service for all of CYBG’s B customers.
- Barclays bank partnered with SMB finance fintech MarketInvoice last year to give Barclays’ SMB clients access to MarkeInvoice’s solutions.
- French Banking-as-a-Service platform Treezor was acquired by Société Générale last year, as the bank looked to enhance its ability to innovate and decrease time to market.
Linked Finance launches ‘Beyond Brexit’ business loans (Bridging and Commercial), Rated: A
The new 18-month loan period will allow borrowers to access working capital facilities of up to €300,000 (approximately £265,194) in just 24 hours.
ID on track to double revenues as it eyes €300m+ of revenue within 2 years (Fintech Finance), Rated: A
ID Finance, the fintech operating in Europe and Latin America, saw revenue growth of over 100% in the first 9 months of 2019 and is on track to double its revenues to €90m revenue this year. The data science, credit scoring and digital finance company is now planning its first equity crowdfunding round via Crowdcube as it targets €300m+ of revenue within 2 years.
Binance Launches New Lending Program Phase (CoinCodex), Rated: A
The Binance cryptocurrency exchange has launched the latest phase of its relatively new lending program. For the program’s eighth installment, Binance is sticking with the model of short-term loans, as users only have to commit their crypto for 14 days.
A Guide to What’s Happening in the Fintech Revolution (Bloomberg), Rated: AAA
These underbanked markets, led by countries in Asia and Africa, have inspired fintech innovation that’s leapfrogging the technology available in the developed world. Ant Financial Services Group’s Alipay and Tencent Holdings’ WeChat Pay in China, Paytm in India, and Safaricom’s M-Pesa in Kenya are some well-known examples.
Take Facebook Inc.’s plan to launch a digital currency called Libra in 2020. The social network’s gigantic reach—more than 2.4 billion active monthly users—could draw a much wider audience to Libra than has used previous cryptocurrencies. For instance, global remittances by migrants reached a record $689 billion last year, according to the World Bank.
San Francisco-based 500 Startups staked 43 such companies in the 12 months ended June 30.
Goldman’s $ 1.3B Marcus burn, Neobank £200MM loss; plus 14 short takes on top developments (Lex), Rated: AAA
Goldman is losing $1.3 billion on Marcus, trying to build a Fintech leader. Etrade is going to lose $75 million from cutting trading fees to $0 to keep up with Robinhood. Revolut is losing £35 million on £60 million in revenue, with another £140 million burned by Atom, Monzo, Tandem, and the rest.
Generally speaking, from a deposit point of view, these are still all small businesses at £1 billion in assets (e.g., Betterment manages $20 billion).
The first is that the Robinhoods and Monzos of the world are 10x overpriced relative to the payments apps. I can sort of buy this — though money in motion is way easier to capture than money at rest. The second is that venture investors think a finance user is worth $1,500 in a digital bank.
Blockchain: the future of finance (Financier Worldwide), Rated: A
Recent examples of blockchain’s impact on financial markets go well beyond these initial applications or P2P lending or crowdfunding.
The first wave of applications in finance and banking is being driven by easily achievable gains in actively traded assets.
MasterCard incorporated a blockchain payment system providing vendors real time, lower cost settlements on cross-border transactions. Representing a consortium of more than 40 of the world’s largest banks, fintech firm R3 launched a payment system built on DLT platform Corda, to expedite intra-bank transfers.
St. Regis Aspen, a Colorado resort, is a partnership formed with a crowdfunding site, Indiegogo, that in lieu of a traditional IPO completed a private placement via DLT financing real estate. This sale of ‘tokens’ – fractional interests in the underlying property – raised $18m, compliant with securities laws.
Hot home loan rates starting with a 2 (mozo), Rated: AAA
The RBA has cut official interest rates for the third time this year, and already a handful of lenders have responded by slashing rates across their range of variable rate home loans. Right now, if your home loan doesn’t have a ‘2’ in front of it, you’re missing out.
OnDeck appoints Robbie Fidler as new national broker chief (IT Wire), Rated: B
Online SME lender OnDeck Australia has appointed experienced commercial lending operator Robbie Fidler as its national broker channel manager.
SPV 2030: Sharing of risks and reward (The Malaysian Reserve), Rated: A
BFS Capital Opens New Data Science and Engineering Hub in Toronto (Financial Post), Rated: B
BFS Capital, a leader in small business lending, has officially launched a data science and engineering hub in Toronto as the company accelerates its plans to develop best-in-class digital financial products for small businesses across the globe.
Internet 1.0 is HTML websites. Internet 2.0 is a social network and user-created content. How is Internet 3.0 coming along? What is Internet 3.0? Are you familiar with Napster, Kazaa, and BitTorrent? Today, Bittorent has met Bitcoin and given birth to the following startups, networks, or organizations: Decentralized computing power. Golem, among others, is a […]
The post A Discussion About Internet 3.0 , Decentralized Everything appeared first on Lending Times.
Internet 1.0 is HTML websites.
Internet 2.0 is a social network and user-created content.
How is Internet 3.0 coming along?
What is Internet 3.0?
Are you familiar with Napster, Kazaa, and BitTorrent? Today, Bittorent has met Bitcoin and given birth to the following startups, networks, or organizations:
- Decentralized computing power. Golem, among others, is a peer-to-peer market for putting your computer’s excess CPU power to use for other people. It works because there is no easy way to pay anybody on the planet fractions of a dollar for having used their CPU for 1 minute. This is, however, possible via blockchain.
- Decentralized exchanges. Ether Delta, among others, is a cryptocurrency exchange which operates in a decentralized way (i.e., without a central counterparty). Decentralized exchanges allow peer-to-peer trading, which means that when a trade is executed the items are exchanged directly between the traders without touching any third party, and without the traders being able to stop the exchange. This approach eliminates counter-party risk entirely. On the other side, it also allows people to trade completely anonymously.
- Decentralized protocol approval. Tezos, among others, is an open-source platform for assets and applications and allows the participants to vote to change its rules and protocols. Participants can choose to change the fee structure, rules, the protocol APIs, nearly everything. This protocol change-mechanism is built within the network rules, and nobody has the right of veto or override. Imagine if eBay merchants could vote to reduce the eBay fees without the eBay management being able to stop it. Of course, this opens the doors to politics, and also to oligarchies as having more Tezos coins obviously gives you more power to influence the votes.
Other similar companies include but are not limited to:
- Decentralized file storage (Filecoin)
- Decentralized domain naming (Namecoin)
- Decentralized cloud storage (Storj)
- Decentralized databases (BigchainDB, IPFS)
- Decentralized internet address allocation (JACS)
- Decentralized Video Encoding and Streaming (Livepeer).
- Decentralize financial services (Bitcoin, Litecoin, etc.) and more.
Centralized online marketplaces , like Amazon, Uber, E-Bay or Lending Club, typically earn roughly 10%-35% of the value exchanges through the platform.
Other online platforms like Facebook or Google don’t share any of the ad revenue earned from the personal-data exchanged through the platform. They keep 100%.
In addition, all centralized marketplaces and platforms exert full control over who can advertise, who and what can be sold, to whom, where, etc.
Their full control, when the company is young or fragile, is not being exercised much. They want to attract users and customers. However, as the company grows, and pressure from investors and the financial markets increases, the platform position of the de facto monopoly in their sector is usually leveraged to increase fees and to control who and what can be transacted on the platform. For example, Google has a history of banning certain ad categories on its platform. Most people agree that the bans, so far, have been legitimate and are targeting harmful or mostly fraudulent industries from selling their products and services. However, Google’s power of life-or-death over entire industries is troublesome.
In comparison, decentralized networks and organizations have so far mostly tried a few different business models.
Financing and crypto coins
Traditional , centralized, startups sell their equity to investors. Equity is scarce by definition, to 100%. And once sold, investors typically have a contractual right preventing startups from creating more shares and diluting them without their approval.
Equity is a problem in a decentralized project. Equity to what? What does an equity holder control?
Most decentralized organizations mentioned above have created their own crypto coins in order to finance their creation. Their usual business model is to make the coin, artificially or legitimately, a required part of each transaction on their network. As the number of transactions grows and the coin inventory is limited, the coins become more valuable. And the network itself uses its own inventory of coins to finance its expenses. In addition, some decentralized networks also take a percentage of the value exchanged on their platforms.
However, the token approach has, so far, failed to work for most networks.
The most successful tokens today have thousands of active daily addresses.
This is not surprising. All these decentralized organizations are new startups. It takes time for startups to build traction. A handful of them will have millions of users after 3-5 years. Most startups may still be viable businesses even though they only have hundreds of daily active users, but their tokens will not have any real value due to over-inventory. Therefore, maybe relying on token activity and scarcity to finance all decentralized projects may not be a viable way to finance these projects.
I believe an alternative token model is needed for most of these projects. A model that will have significant return to investors even if the network only achieves modest success of 100s of transactions per day. However, this may require an increase in network fees.
The X Open questions of decentralized entities
As I think of decentralization, many questions are on my mind:
- What are these entities? Are they businesses, networks, organizations, protocols, or something else? The concept of Decentralized Autonomous Organization, or DAO, has been used in the past. But to my knowledge, no actively operating entity using a real DAO model is live and generating revenue today. All entities have executives, employees, bank accounts, offices, etc. Or is it? The Bitcoin network itself, with all the developers in various organizations who are trying to contribute to it, is fairly decentralized.
- Governance: Leaders in centralized entities are required. Often, leaders aren’t any good at taking decisions, but making some decision is often better than not being able to make any decision. Many an organization has died because nothing at all was done. Are decentralized organizations able to make decisions fast and efficiently over 5 to 10 years while they grow?
- Are decentralized networks cheaper to run, and do they have a disruptor advantage over centralized networks? It is not clear. Lending Club, one of the first P2P lending startups, argued that their cost structure was cheaper than banks’. However, it turns out the cost of capital lending and cost of customer acquisition were under-estimated and banks have cheaper capital and cheaper customer acquisition. Lending Club’s profit margins are not impressive. Neither is Uber’s. Nor are Amazon’s. I believe there is no single answer to this question, but assuming that a decentralized entity is more cost effective than a centralized entity is not obvious. In human history, disciplined centralized organizations (armies, empires, …) have clearly been more successful than federations, communes, etc.
- Is there value built, and where is it? The startup/VC model has worked since the Dot Com boom because it was a profitable model for everybody involved. VCs made money, and successful entrepreneurs attracted more smart wannabe entrepreneurs. It is very important to see the founders and investors in these decentralized organizations be successful or there will be no second generation decentralized entities.
What is the innovation here?
I believe that an exchange that can work without counterparty risk is a real innovation.
I believe that a method to pay fractions of a dollars efficiently to anybody on the planet is a real innovation.
I believe one day we will see the Netflix of Internet 3.0 bankrupt the Blockbuster of Internet 0, 1.0, or 2.0.
However, questions remain. Is decentralization in business similar to communism in politics? Does this model really work? In 1990, in Moscow, everything was rationed, bread was extremely scarce. When a communist leader asked the London mayor who is in charge of the bread supply to London so they can learn their secrets, the mayor, confused, answered “Nobody!” Our modern food supply is a decentralized market, and fewer and fewer people are going hungry.
The post A Discussion About Internet 3.0 , Decentralized Everything appeared first on Lending Times.
News Comments Today’s main news: Morningstar to rate blockchain securities. nCino raises $80M. RateSetter rolls out Access, Plus, Max. Revolut losses double. Today’s main analysis: Race and homeownership. Today’s thought-provoking articles: Big banks are losing mortgage share. Race and homeownership. LendIt Fintech Europe highlights. International P2P lending volumes for September 2019. United States Morningstar to offer […]
- Today’s main news: Morningstar to rate blockchain securities. nCino raises $80M. RateSetter rolls out Access, Plus, Max. Revolut losses double.
- Today’s main analysis: Race and homeownership.
- Today’s thought-provoking articles: Big banks are losing mortgage share. Race and homeownership. LendIt Fintech Europe highlights. International P2P lending volumes for September 2019.
- Morningstar to offer ratings on blockchain securities. This should have been easily seen. Blockchain-based securities is growing fast and could overtake traditional securities in volume in short order.
- nCino raises $80 million. nCino is working to make banks more competitive with fintech.
- Big banks are losing mortgage share. Of course, they’re losing that share to non-bank lenders and alternative lenders.
- White Americans are largest homeowner segment. Across the board, white Americans are the largest homeowner segment, however, there are markets where they don’t dominate.
- BFS Capital eliminates upfront fees.
- Self launches first-of-kind secured credit card without a credit check.
- Crowdfunding may not come to commercial real estate.
- RiverNorth Marketplace Lending announces monthly distribution of $0.18 per share.
- Robots will eliminate 200,000 bank jobs in 10 years.
- Goldman traders kicked off desk.
- The 7-year auto loan.
- Naborly raises $7.5 million.
- How much can you get from a business loan?
- Best mortgage lenders for first-time buyers.
- Coinbase to offer 1.25% APy on USDC holdings.
- Curo wants to drop lawsuit.
- eOriginal chief product officer honored.
- OYO partners with Biz2Credit on small business financing for hotels.
- Finastra launches Fusion Mortgagebot Data Insights.
- Seattle Bank expands relationship with Finastra.
- RateSetter rolls out Max, Access, Plus.
- Revolut doubles losses.
- Visa expands Revolut partnership.
- LandlordInvest asks staff to avoid EU travel as P2P lenders prepare for Brexit.
- Small business owners should beware when backing business debt.
- Fintech is the future of finance.
- Brokers should be Open Banking advocates.
- Drapers, Klarna to launch Next Generation Entrepreneurs.
- Bunq to launch in UK.
- Entrepreneurs reveal how failures, triumphs shape who they are.
- Ex-city minister shines spotlight on P2P lending secondary markets.
- How Linked Finance links Irish SMEs with quick loans.
- LendIt Fintech Europe 2019 highlights.
- Bnext raises $25 million.
- Australia: RateSetter partners with PLAN Australia.
- Indonesia: Pawnshop PT Pegadaian to invest $35 million in local fintech.
- Canada needs to take more chances on fintech.
- South Africa: CredoLab to drive financial inclusion.
- Australia: National Australia Bank to provide $57 million to Symple Loans.
- Asia: INLOCK listed as one of the largest crypto exchanges.
- Australia: Which banks have cut home loan rates?
- Singapore: 40 solutions shortlisted for 2019 fintech awards.
- United States
- Morningstar Inc. will offer ratings to blockchain based securities (Ripple Coin News), Rated: AAA
- North Carolina-based Fintech Startup nCino Raises $ 80M (Crunchbase), Rated: AAA
- Bank Wars; ABS East + Blockchain; Housing (PeerIQ), Rated: AAA
- White Americans Have the Highest Homeownership Rates but There Are Large Differences Among Cities (LendingTree), Rated: AAA
- BFS Capital Eliminates Upfront Fees to Simplify Financing for Small Business Owners (Yahoo! Finance), Rated: A
- Self Announces The Self Visa Credit Card, A First-Of-Its-Kind Secured Credit Card That Does Not Require A Credit Check (Globe Newswire), Rated: A
- The Crowdfunding Revolution Might Never Come To CRE (Bisnow), Rated: A
- RiverNorth Marketplace Lending Announces Monthly Distribution of $0.18 Per Share (Crowdfund Insider), Rated: A
- The Robot Revolution Will Wipe Out 200,000 U.S. Banking Jobs in the Next Decade (Fortune), Rated: A
- Goldman Sachs Tries Banking for the Masses. It’s Been a Struggle. (WSJ), Rated: A
- Small bank’s big digital goal: Launch 3 niche banks (American Banker), Rated: A
- The Seven-Year Auto Loan: America’s Middle Class Can’t Afford Its Cars (WSJ), Rated: A
- Naborly Raises $ 7.5M in Seed Funding (FINSMES), Rated: A
- How Much Money Can I Get From a Business Loan? (All Business), Rated: A
- Best Mortgage Lenders for First-time Buyers (Benzinga), Rated: A
- Coinbase Announces 1.25% APY on USDC Holdings (DeFi Rate), Rated: A
- Investors Say Curo’s Bid To Nix Their Suit Misses The Point (Law360), Rated: A
- eOriginal Chief Product Officer Honored as a 2019 HousingWire Tech Trendsetter (PR Web), Rated: B
- OYO Announces Partnership With Biz2Credit to Provide Small Business Financing Options to Hotel Owners (Globe Newswire), Rated: B
- Finastra Launches Fusion Mortgagebot Data Insights to Help Financial Institutions Optimize their Mortgage Business (Financial Content), Rated: B
- Seattle Bank expands relationship with Finastra to drive innovation (Finastra), Rated: B
- United Kingdom
- Welcome to Access, Plus and Max! (RateSetter), Rated: AAA
- Fintech unicorn Revolut’s losses double as it pushes for global expansion (CNBC), Rated: AAA
- Visa Expands Alliance with Revolut to Grow in Fintech Space (Zacks), Rated: A
- LandlordInvest staff asked to avoid EU travel as P2P lenders prepare for Brexit deadline (P2P Finance News), Rated: A
- Small business owners should beware when backing their business debt (Money Week), Rated: A
- The future of finance is fintech (Raconteur), Rated: A
- Brokers should be Open Banking advocates (Bridging and Commercial), Rated: A
- Drapers and Klarna launch Next Generation Entrepreneurs (Drapers), Rated: A
- Dutch app-only bank Bunq to launch in UK this week (AltFi), Rated: A
- 10 Respected Entrepreneurs Reveal How Failures and Triumphs Shaped Who They Are Today (Digital Journal), Rated: A
- Ex-City minister shines spotlight on P2P lending secondary markets (P2P Finance News), Rated: B
- European Union
- How Linked Finance is Linking Irish SMEs With Quick Loans (deBanked), Rated: AAA
- LendIt Fintech Europe 2019 Conference Highlights (Lend Academy), Rated: AAA
- Bnext raises $ 25 million for its mobile banking alternative (TechCrunch), Rated: A
- International P2P Lending Volumes September 2019 (P2P-Banking), Rated: AAA
- P2P lender partners with aggregator (Broker News), Rated: AAA
- National Australia Bank to provide $ 57m warehouse funding facility to Symple Loans (AltFi), Rated: A
- Which banks have cut home loan rates already? (mozo), Rated: A
- Indonesia’s State-Owned Pawnshop PT Pegadaian to Invest $ 35 Million in Local Fintech Firms (Crowdfund Insider), Rated: AAA
- Another Milestone Comes True: INLOCK Is Listed on One of the Largest Crypto Exchanges (NewsBTC), Rated: A
- 40 Innovative Solutions Shortlisted for 2019 FinTech Awards (MAS), Rated: A
- CredoLab set to drive financial inclusion in South Africa (Next Billion), Rated: AAA
- Stability’s important, but Canada needs to take more chances with fintech (Financial Post), Rated: A
Morningstar Inc. will offer ratings to blockchain based securities (Ripple Coin News), Rated: AAA
Chicago-based financial service provider, Morningstar Credit Ratings announced plans to diversify its business operation by providing ratings for debt securities issued on public blockchains, also known as crypto-assets. Morningstar Inc, the parent company of the rating agency is valued at $6.4 billion. Last year it generated $1.7 billion in revenue. The company is well known for rating mutual funds from giants of the financial world like Prudential and Morgan Stanley among others.
North Carolina-based Fintech Startup nCino Raises $ 80M (Crunchbase), Rated: AAA
Bank Wars; ABS East + Blockchain; Housing (PeerIQ), Rated: AAA
In U.S Housing, borrower home equity is hitting all time highs. Homeowners with a mortgage saw equity increase by 4.8% since 2Q2018. This equates to $4,900 gained per American homeowner and a strengthening of the US consumer balance sheet.
Over the past ten years, the largest American banks – Wells Fargo, JPMorgan, and Bank of America – have seem their share of home loan originations fall 30% as digital customer friendly non-banks such as Quicken Loans take share.
White Americans Have the Highest Homeownership Rates but There Are Large Differences Among Cities (LendingTree), Rated: AAA
Americans who identify as white own a disproportionately large percentage of homes in all of the nation’s 50 largest metros. White Americans make up an average of 59% of people in the metros featured in our study, but they own around 73% of owner-occupied homes.
Where white Americans own the most homes relative to their overall population
% of the population – White alone: 46.99%
Median household income – White alone: $91,806
% of owner-occupied homes – White alone: 68.65%
Difference between % of owner-occupied homes and % of population: 21.66%
% of the population – White alone: 46.20%
Median household income – White alone: $80,276
% of owner-occupied homes – White alone: 65.37%
Difference between % of owner-occupied homes and % of population: 19.17%
% of the population – White alone: 56.41%
Median household income – White alone: $64,423
% of owner-occupied homes – White alone: 75.17%
Difference between % of owner-occupied homes and % of population: 18.76%
Where white Americans own the least homes relative to their overall population
% of the population – White alone: 85.82%
Median household income – White alone: $59,089
% of owner-occupied homes – White alone: 93.29%
Difference between % of owner-occupied homes and % of population: 7.47%
BFS Capital Eliminates Upfront Fees to Simplify Financing for Small Business Owners (Yahoo! Finance), Rated: A
BFS Capital today announced it has eliminated all upfront fees on its financing solutions, including loans and business advances, as it simplifies pricing for small business owners.
BFS Capital customers can now apply for and receive up to $500,000 in financing with no origination fees, no processing fees and no upfront costs.
Self Announces The Self Visa Credit Card, A First-Of-Its-Kind Secured Credit Card That Does Not Require A Credit Check (Globe Newswire), Rated: A
Self, a leading fintech startup offering people a way to build their credit while also saving money, today announced the release of the Self Visa® Credit Card. This first-of-its-kind secured card uses a unique funding model to provide customers with a line of credit without the need for a significant upfront investment or a credit check – two areas that perennially sideline subprime consumers who are looking to build their credit scores.
The Crowdfunding Revolution Might Never Come To CRE (Bisnow), Rated: A
Crowdfunding has not coalesced into the influential force in commercial real estate some may have expected, and is at risk of being decimated by the next economic downturn.
RiverNorth Marketplace Lending Announces Monthly Distribution of
RiverNorth Marketplace Lending Announces Monthly Distribution of $0.18 Per Share (Crowdfund Insider), Rated: A.18 Per Share (Crowdfund Insider), Rated: A
RiverNorth Marketplace Lending Corporation, an established and currently operating as a closed-end interval fund dedicated to the marketplace lending asset class, announced on Tuesday its monthly distribution of $0.18 per common share for the months of October, November, and December 2019.
The Robot Revolution Will Wipe Out 200,000 U.S. Banking Jobs in the Next Decade (Fortune), Rated: A
Technological efficiencies will result in the biggest reduction in headcount across the U.S. banking industry in its history, with an estimated 200,000 job cuts over the next decade, Wells Fargo & Co. said in a report.
The $150 billion annually that the country’s finance firms are spending on tech — more than any other industry — will lead to lower costs, with employee compensation accounting for half of all bank expenses, said Mike Mayo, a senior analyst at Wells Fargo Securities LLC.
Two dozen of Goldman Sachs Group Inc.’s most profitable traders were kicked off their desk last year to make room for the swelling ranks of the firm’s Main Street lending arm.
Small bank’s big digital goal: Launch 3 niche banks (American Banker), Rated: A
The first one, introduced this summer, is called “booyah” and is aimed at college students and young graduates. The $122 million-asset bank sees it as a way to target a specific audience outside the central Florida area and boost deposits in order to ward off competitive threats from fintechs.
Walk into an auto dealership these days and you might walk out with a seven-year car loan.
That means monthly payments that last well past when the brake pads give out and potentially beyond when the car gets traded in for a new one. About a third of auto loans for new vehicles taken in the first half of 2019 had terms of longer than six years, according to credit-reporting firm Experian PLC. A decade ago, that number was less than 10%.
Naborly Raises $ 7.5M in Seed Funding (FINSMES), Rated: A
Naborly, a San Francisco, CA-based credit bureau for the rental industry, closed its $7.5m seed funding round.
How Much Money Can I Get From a Business Loan? (All Business), Rated: A
It’s rare for two loan offers from two lenders to come out to exactly the same number. Different lenders (traditional banks, online lenders, alternative lenders) evaluate a variety of factors, have different algorithms, and may place more emphasis on different aspects of your business history.
Coinbase Announces 1.25% APY on USDC Holdings (DeFi Rate), Rated: A
This announcement comes amid the DeFi boom in 2019. While 1.25% APY is substantially higher than traditional savings rates at banks, it’s still lagging behind the broader DeFi lending market. As of writing, Compound currently offers 5.34% APY on USDC holdings while dYdX offers 3.85% APY – View current USDC lending rates. This doesn’t account for other stablecoins, such as Dai, where holders can earn upwards of 8%.
Investors Say Curo’s Bid To Nix Their Suit Misses The Point (Law360), Rated: A
eOriginal, a digital lending technology pioneer, is proud to announce that Simon Moir, Chief Product Officer, has been named to HousingWire’s Tech Trendsetters list for 2019. HousingWire’s inaugural award recognizes the impactful and innovative technology leaders serving the housing and mortgage finance industry. This is on the heels of eOriginal’s second consecutive listing as one of HousingWire’s HW Tech 100TM in April 2019.
OYO Announces Partnership With Biz2Credit to Provide Small Business Financing Options to Hotel Owners (Globe Newswire), Rated: B
OYO, the world’s third-largest and fastest-growing chain of hotels, homes and spaces*, has partnered with Biz2Credit to provide working capital and commercial real estate loans to existing and potential hotel partners across the United States.
Finastra Launches Fusion Mortgagebot Data Insights to Help Financial Institutions Optimize their Mortgage Business (Financial Content), Rated: B
Finastra has launched Fusion Mortgagebot Data Insights – a powerful new tool that benchmarks mortgage borrower behavior and demographics for banks and credit unions against that of more than 1,400 other Fusion MortgagebotPOS users. The solution leveraged Big Data and machine learning to provide users with new insights into consumer behavior to drive a better borrower experience.
Seattle Bank expands relationship with Finastra to drive innovation (Finastra), Rated: B
Seattle Bank, a single branch boutique bank with $650 million in assets, has selected Fusion Phoenix from Finastra to be the open, modern core to run its banking operations, enabling the bank to better serve clients. The core banking system will be integrated with additional Finastra solutions, including Fusion Mortgagebot, Fusion Card Payments, Fusion Analytics, Fusion Item Processing Services, Fusion LaserPro, and Fusion Digital Banking.
Welcome to Access, Plus and Max! (RateSetter), Rated: AAA
I am delighted to say that our three new investment products – Access, Plus and Max – launched today and are ready for you to enjoy.
Fintech unicorn Revolut’s losses double as it pushes for global expansion (CNBC), Rated: AAA
British financial technology start-up Revolut’s losses doubled in 2018, the firm said Tuesday, as the company embarks on an aggressive global expansion.
The London-headquartered firm recorded a £32.8 million ($40.3 million) net loss on revenues of £58.2 million for 2018. That was more than double the £14.8 million loss it posted a year earlier, while revenue climbed 354%.
Visa Expands Alliance with Revolut to Grow in Fintech Space (Zacks), Rated: A
LandlordInvest staff asked to avoid EU travel as P2P lenders prepare for Brexit deadline (P2P Finance News), Rated: A
LANDLORDINVEST has asked staff to avoid travelling outside the UK after 31 October as peer-to-peer lending platforms prepare for the latest Brexit deadline.
Small business owners should beware when backing their business debt (Money Week), Rated: A
After all, one argument for setting up a business as a limited company, rather than operating as a sole trader, is that you separate your affairs from the company’s.
However, while this is true in theory, it may not pan out in practice. If your business needs to borrow, lenders often expect owners to stand behind the loan. They ask for a personal guarantee that the debt will be repaid. These guarantees aren’t secured – they’re not tied to a particular asset, such as your home – but they do give lenders a legal right to come after your personal wealth in the event your business defaults.
The future of finance is fintech (Raconteur), Rated: A
When Innovate Finance was formed five years ago, with a mandate to represent an emerging UK fintech community, the picture was different to today. The focus was on models challenging traditional approaches to banking, disrupting the incumbents’ model that had stood for decades.
In the years since, peer-to-peer lending became simpler, management of personal finances became more accessible, and remittance processes became faster and more affordable.
Brokers should be Open Banking advocates (Bridging and Commercial), Rated: A
It’s now more than a year and a half since the introduction of Open Banking, which allows people to securely share data about how they spend their money with other parties.
Drapers and Klarna launch Next Generation Entrepreneurs (Drapers), Rated: A
Drapers’ Next Generation Entrepreneurs are the founders and chief executives that we think are changing fashion. The list shines a light on the new wave of game-changers, innovators and boundary-breakers that are making their mark on the UK fashion industry, as well as emerging businesses that exhibit innovative, entrepreneurial spirit.
Dutch app-only bank Bunq to launch in UK this week (AltFi), Rated: A
The Dutch app-only bank bunq is to launch in the UK this week, saying there are “too many traditional banks” in the UK.
10 Respected Entrepreneurs Reveal How Failures and Triumphs Shaped Who They Are Today (Digital Journal), Rated: A
– Courtney Nichols Gould, Founder& co-CEO, SmartyPants Vitamins
– Annie Jackson, co-founder & COO, Credo Beauty
– Sarah Kauss, Founder & CEO, S’well
– Stephen Kuhl, co-founder & CEO, Burrow
– Renaud LaPlanche, co-founder & CEO, Upgrade, Founder of Lending Club (NYSE: LC)
– Jody Levy, Founder, CEO & Creative Director, World Waters (Maker of WTRMLN WTR)
– Betty Liu, Founder of Radiate, Executive Vice Chairman of The New York Stock Exchange (NYSE)
– Ben McKean, Founder, Hungry Root
– Sasha Plavsic, Founder & CCO, ILIA Beauty
– Nat Turner, co-founder & CEO, Flatiron Health
Ex-City minister shines spotlight on P2P lending secondary markets (P2P Finance News), Rated: B
The former City minister, who has already tabled several parliamentary questions regarding the role of the Financial Conduct Authority (FCA) in the collapse of Lendy and Collateral, has widened the scope of his P2P queries.
He has tabled two parliamentary written questions in the past week.
How Linked Finance is Linking Irish SMEs With Quick Loans (deBanked), Rated: AAA
The nation’s Central Statistics Office puts the number of active enterprises in the private business economy at over 250,000. As of June, Linked Finance had made more than 2,100 loans for a grand total of more than €100 million.
LendIt Fintech Europe 2019 Conference Highlights (Lend Academy), Rated: AAA
We have just wrapped up what I think has been the most successful European conference LendIt has ever had.
We kicked off the show with Rishi Khosla, CEO and Co-Founder of OakNorth. Their approach to underwriting is super interesting. While they have very much a digital approach, they are originating loans typically for £5 million to £10 million to fast growth companies.
Bnext raises $ 25 million for its mobile banking alternative (TechCrunch), Rated: A
Fintech startup Bnext has raised a $25 million funding round. The Spanish company is building a banking product and has managed to attract 300,000 active users.
You can lend money to small and medium businesses and earn interest through October, you can save money using Raisin, you can get a loan, a mortgage, an insurance product, etc. Bnext generates revenue from those partnerships.
International P2P Lending Volumes September 2019 (P2P-Banking), Rated: AAA
Milestones in culumulative volume lent crossed this month:
P2P lender partners with aggregator (Broker News), Rated: AAA
Peer-to-peer lender RateSetter has announced a partnership with PLAN Australia that will make its unsecured personal loan and car loan products available to the group’s 1,700 brokers and their clients.
National Australia Bank to provide $ 57m warehouse funding facility to Symple Loans (AltFi), Rated: A
Australia’s biggest business bank is furnishing a $57m (£46m) warehouse funding facility to personal lender Symple Loans, as part of its $2bn (£1.63bn) commitment to fund technology startups.
Which banks have cut home loan rates already? (mozo), Rated: A
It’s been two days since the Reserve Bank board made the call to lower the official cash rate from 1.00% to 0.75% – an historically low rate in Australia.
Athena and Homestar raced out of the blocks following Tuesday’s RBA announcement – both delivering full 0.25% cuts to their respective variable rate home loans before the ink on RBA Governor Philip Lowe’s monetary policy statement was dry.
Fellow online lender UBank wasn’t far behind after announcing a 0.25% rate cut of its own across a number of variable rate offers.
Indonesia’s State-Owned Pawnshop PT Pegadaian to Invest $ 35 Million in Local Fintech Firms (Crowdfund Insider), Rated: AAA
The state-owned pawnshop PT Pegadaian in Indonesia is reportedly planning to invest Rp 500 billion (appr. $35.26 million) in several local Fintech firms this year.
Another Milestone Comes True: INLOCK Is Listed on One of the Largest Crypto Exchanges (NewsBTC), Rated: A
On September 30, 2019, after nearly six months of preparation, the INLOCK project, a peer-to-peer lending solution, was listed on the Liquid by Quoine exchange, one of the largest Japanese crypto exchanges in the Asian region, with a daily turnover of $150-200 million.
INLOCK is a peer-to-peer lending platform; its customers can lend or borrow using their cryptocurrencies as a collateral.
40 Innovative Solutions Shortlisted for 2019 FinTech Awards (MAS), Rated: A
The Monetary Authority of Singapore (MAS) and The Association of Banks in Singapore (ABS) announced today that 40 finalists have been shortlisted for the FinTech Awards to be presented at this year’s Singapore FinTech Festival x Singapore Week of Innovation and Technology (SFF x SWITCH).
CredoLab set to drive financial inclusion in South Africa (Next Billion), Rated: AAA
Credit scoring fintech company, CredoLab announced on Tuesday, 1 October 2019, that it has officially launched in Africa. Starting in South Africa, CredoLab is aiming to drive financial inclusion in emerging economies on the continent by credit scoring more people, especially those who are new to banking or credit.
Stability’s important, but Canada needs to take more chances with fintech (Financial Post), Rated: A
According to Ernst & Young’s 2019 Global Fintech Adoption Index, Canada is 14 points, and the U.S. 18 points, behind the global average of 64 per cent consumer fintech adoption, and we trail world leaders like China, India and Russia by even more. The two countries’ approaches to regulating fintech, which in many ways reflect enduring national stereotypes, almost certainly have contributed to our continent’s fintech lag.
News Comments Today’s main news: Prosper reports Q2 results. Figure to raise $1B. Funding Circle shares rise. RateSetter to stress test provision fund. LendInvest raises 200M GBP. Two more Chinese P2P firms shut down. N26 eyes IPO. Today’s main analysis: Gen Z’s credit market activity. Today’s thought-provoking articles: Radius Bank’s rebranding to banking as a […]
- Today’s main news: Prosper reports Q2 results. Figure to raise $1B. Funding Circle shares rise. RateSetter to stress test provision fund. LendInvest raises 200M GBP. Two more Chinese P2P firms shut down. N26 eyes IPO.
- Today’s main analysis: Gen Z’s credit market activity.
- Today’s thought-provoking articles: Radius Bank’s rebranding to banking as a service. European fintechs escape banking troubles. German yield curve, GreenSky’s sale. Is alternative data the great lending equalizer?
- Prosper’s Q2 results. Total net revenue increased to $42.9 million while core revenue decreased to $50.7 million.
- Figure to raise $1 billion. Can Mike Cagney’s second act be as strong as his first? Some people are banking on it.
- Gen Z comes of age as credit market activity shows growth. Where millennial buyers shunned credit for the most part, Gen Z seems to be embracing it.
- Radius Bank transitions into banking as a service. A very interesting read.
- Klarna challenges PayPal. Not exactly new news, but worth a read.
- Lendio facilitates $50 million in small business loans.
- LendingPoint hits #17 on Inc. 500 list of fastest growing private companies.
- OppLoans on the Inc. 500 list for fourth straight year.
- Finicity to power digital solutions for employer student loan contributions.
- Fannie Mae, Freddie Mac consider FICO alternatives.
- Review of Zoca Loans.
- HSBC launches digital lending platform for personal loans.
- Napa Valley gets a P2P lending service.
- Regulators should expand small investor opportunities.
- Former Coinbase CTO joins DeFi.
- Tricolor launches auto insurance for low income credit-invisible consumers.
- Artivest makes new executive appointment.
- Former Lending Club worker hired by Healthline Media as VP of communications.
- Funding Circle shares rise.
- RateSetter to stress test provision fund.
- LendInvest raises 200 million GBP.
- Klarna research uncovers SME retail barriers to innovation.
- More on SME retailers.
- Tandem Bank leverages open banking for mortgages.
- 5 things Starling’s 2019 annual report teaches us.
- Barclays releases 100,000 GBP for unsecured SME lending.
- Nexa Finance launches.
- Personal Finance Society publishes P2P guide.
- Atom Bank, iwoca, others receive BCR grant.
- Former Wonga employee discusses who much he’d have if he got paid.
- Zendai shuts down two P2P units.
- Laocaibao folds.
- Local authorities send cease and desist letter to Fincera.
- Fincera to sell Kaiyuan Finance Center.
- Senmiao Technology reports unaudited Q1 results for FY 2020.
- N26 has eye on IPO. This doesn’t really surprise us, and it likely will be in the U.S.
- Google executive joins N26.
- European fintechs escape bank troubles.
- FlexMobility, Klarna raise funds.
- EstateGuru looking to attract 5 billion euro of European real estate financing market.
- Finleap to launch new business unit.
- Germany’s yield curve, Greensky’s sale. A MUST-READ.
- Is alternative data the great lending equalizer? A great read.
- Celsius Network to increase crypto loan accessibility.
- Ontology blockchain partners with DeFi.
- India: Faircent raises more money.
- Latin America: Fintech debt investors follow equity.
- Australia: CBA’s FY19 results.
- Indonesia: Musketeer completes P2P platform registration.
- India: Keep retail indulgence in check.
- Philippines: OF Bank to relaunch as digital-only.
- Brazil: VEF invests in FinanZero.
- United States
- Prosper Reports Second Quarter 2019 Financial Results (Business Wire), Rated: AAA
- SoFi Co-Founder’s New Startup Aims to Raise Funds at $ 1 Billion (Bloomberg), Rated: AAA
- As Gen Z Comes of Age, Credit Market Activity Shows Significant Growth (TransUnion), Rated: AAA
- Swedish Fintech Unicorn to Challenge Paypal with U.S. Expansion (150sec), Rated: A
- Lendio Franchising Facilitates $ 50 Million to Small Businesses (Crowdfund Insider), Rated: A
- Atlanta-Based LendingPoint #17 on Inc. 500 List of Fastest Growing Private Companies in the USA (The Daily Times), Rated: A
- Fintech Firm OppLoans Named to Inc. 500 for Fourth Consecutive Year (Globe Newswire), Rated: A
- FINICITY TO POWER DIGITAL SOLUTIONS FOR EMPLOYER STUDENT LOAN CONTRIBUTIONS (Finicity), Rated: A
- Fannie, Freddie to Consider Alternatives to FICO Scores (WSJ), Rated: A
- Zoca Loans Review: Installment Loans for Bad Credit Borrowers (Moneycheck), Rated: A
- HSBC launched a digital lending platform for online personal loans (Business Insider), Rated: A
- Virtual Bank Aims to be Primary Account Engine Behind Fintech Brands (The Financial Brand), Rated: AAA
- New financial lending program available through UpValley Family Centers (Napa Valley Register), Rated: A
- It’s Time For Regulators To Expand Opportunities For Smaller Investors (Forbes), Rated: A
- Former Coinbase CTO Balaji Srinivasan Joins DeFi Blockchain Project Findora (Yahoo! Finance), Rated: B
- Tricolor Launches New, Affordable Auto Insurance for Low Income, Credit Invisible Consumers (Globe Newswire), Rated: B
- Artivest Achieves Critical Platform Momentum, Announces Executive Leadership Appointment (Yahoo! Finance), Rated: B
- Netflix alum Steve Swasey to lead communications at Healthline Media (MMM-Online), Rated: B
- United Kingdom
- Funding Circle Shares Rise on Positive Report (Crowdfund Insider), Rated: AAA
- RateSetter to introduce stress testing to provision fund (P2P Finance News), Rated: AAA
- LendInvest Secures £200 Million Investment from the National Australia Bank to Expand Reach in Buy-to-Let Market (The Fintech Times), Rated: AAA
- SME online fashion retailers face barriers to innovation, Klarna (Retail Tech Innovation Hub), Rated: A
- SME online retailers look to overcome barriers to realise innovation ambitions (Retail Times), Rated: A
- Tandem Bank leverages Open Banking to offer competitive mortgages (Finextra), Rated: A
- 5 things we learnt from Starling’s 2019 Annual Report (AltFi), Rated: A
- Ex-RateSetter business finance head launches new P2P platform (P2P Finance News), Rated: A
- Personal Finance Society publishes P2P guide following uptick in queries (P2P Finance News), Rated: A
- Atom Bank, iwoca, Modulr Finance, & Currencycloud, All Benefit from BCR Grant (Crowdfund Insider), Rated: A
- I Never Got Paid From Winning Wonga Fantasy League in 2010 (TechRound), Rated: A
- Shanghai-based Zendai closes two P2P units worth US$ 1.4 billion as Beijing intensifies crackdown (SCMP), Rated: AAA
- Another Peer-to-Peer Lending Platform Stumbles (Caixin Global), Rated: A
- Peer to Peer Lender Fincera Targeted by Local Chinese Government in Demand to Cease Lending Operations (Crowdfund Insider), Rated: A
- Fincera Announces Intention to Sell Kaiyuan Finance Center (Benzinga), Rated: A
- Senmiao Technology Announces Unaudited Financial Results for First Quarter of Fiscal Year 2020 (Yahoo! Finance), Rated: A
- European Union
- German mobile bank N26 eyes eventual IPO, CEO tells newspaper (Reuters), Rated: AAA
- Google exec joins N26 as chief banking officer (Finextra), Rated: B
- European Fintechs Escape Troubles Afflicting Established Banks (Bloomberg), Rated: AAA
- FlixMobility and Klarna raise a lot of money (Tech.eu), Rated: A
- EstateGuru Seeks to Carve Out €5 Billion of European Real Estate Financing Market (Crowdfund Insider), Rated: A
- Barclays releases £100,000 for unsecured SME lending through app and online banking (Finextra), Rated: A
- German Fintech Finleap Announces New Business Unit “Finleap Connect” (Crowdfund Insider), Rated: B
- Global Yields Crash, GSKY for sale, LC earnings (PeerIQ), Rated: AAA
- Alternative Data: The Great Equalizer To Lending Inequalities? (Forbes), Rated: AAA
- Celsius Network Announces Increased Accessibility To Crypto-Backed Loans with Updated Terms for Borrowers (Business Wire), Rated: A
- ONTOLOGY BLOCKCHAIN HIGH FIVES WITH DEFI (ICO Examiner), Rated: B
- CBA FY19 results a mixed bag, digital metrics positive and Klarna will be a hit (Verdict), Rated: AAA
- Faircent raises fresh funding from investors led by Das Capital & Gunosy Capital (India Times), Rated: AAA
- Keep retail indulgence in check (livemint), Rated: A
- Hexindai-backed Musketeer Completes Registration for Its P2P Platform in Indonesia (Yahoo! Finance), Rated: AAA
- Philippines to Relaunch OF Bank to Create Digital-only Bank (Regulation Asia), Rated: A
- Latin America
- Fintech Debt Investors Follow Equity Dollars Into Latin America (Forbes), Rated: AAA
- Financial report for the second quarter and six months period 2019 (Yahoo! Finance), Rated: B
Prosper Reports Second Quarter 2019 Financial Results (Business Wire), Rated: AAA
Prosper, a peer-to-peer lending platform connecting borrowers and investors, today reported financial results for the second quarter of 2019. Personal loan originations increased 27% compared to the first quarter of 2019, and the company has now generated positive adjusted EBITDA in eight out of the last nine quarters.
- Total Net Revenue, which includes the non-cash impact related to warrants to purchase preferred stock, increased to $42.9 million in Q2 2019 compared to $31.7 million in Q2 2018.
- Core Revenue(1), which excludes the non-cash impact related to warrants to purchase preferred stock, decreased to $50.7 million in Q2 2019 compared to $52.3 million in Q2 2018.
- Net Loss decreased to ($0.6) million in Q2 2019 compared to a Net Loss of ($12.6) million in Q2 2018.
- Adjusted EBITDA(1) decreased to $5.3 million in Q2 2019 compared to $8.8 million in Q2 2018.
Key Operating and Financial Metrics (Unaudited) (in thousands)
SoFi Co-Founder’s New Startup Aims to Raise Funds at $ 1 Billion (Bloomberg), Rated: AAA
Mike Cagney, the former embattled chief executive officer of Social Finance Inc., is raising more than $100 million for his new startup Figure Technologies Inc. at a $1 billion valuation just less than two years after its founding, according to people familiar with the matter.
San Francisco-based Figure uses blockchain technology to provide home equity loans online in just a few days, with approval happening in minutes. The company made its first loan in 2018, and is on pace to provide more than $80 million in loans this month alone, according to one of these people, who asked not to be named because the details are private.
As Gen Z Comes of Age, Credit Market Activity Shows Significant Growth (TransUnion), Rated: AAA
Gen Z, those individuals born in 1995 or after, increasingly took part in the consumer credit market during the first half of 2019. The newly released Q2 2019 Industry Insights Report from TransUnion (NYSE: TRU) found that growth is coming from the entire Gen Z demographic who are 18 years or older – not just those who became credit eligible for the first time.
Approximately 14 million Gen Z consumers (44% of this group) were carrying a balance as of Q2 2019, up from 11 million in Q2 2018, according to the report. The number of Gen Z consumers who were credit eligible (18 years or older) increased by 4.5 million in the last year, rising to 31.5 million in Q2 2019. Over the next three years, it is anticipated that another 13 million Gen Z consumers will become credit eligible.
Gen Z Consumers Carrying a Balance Rising at High Rates
|Credit Product||Q2 2019||Q2 2018||YOY Growth %|
Credit cards are the most popular product among Gen Z consumers, with 55% carrying a balance—though they still only constitute 5% of the U.S. population carrying card debt. Mortgages had the largest year-over-year growth rate spike with Gen Z consumers (112%), but from a low base. Mortgages are still the credit product Gen Z consumers are least likely to have, with only 0.5% of mortgages held by members of this generation.
The Percentage of Gen Z Consumers Carrying a Credit Balance is Growing (Data as of Q2 2019)
|Credit Product||Gen Z
(carrying a balance)
(carrying a balance)
Q2 2019 Credit Card Trends
|Credit Card Lending Metric||Q2 2019||Q2 2018||Q2 2017||Q2 2016|
|Number of Credit Cards||437.1 million||420.0 million||409.8 million||391.0 million|
|Borrower-Level Delinquency Rate (90+ DPD)||1.71%||1.53%||1.46%||1.29%|
|Average Debt Per Borrower||$5,645||$5,543||$5,422||$5,247|
|Prior Quarter Originations*||15.3 million||14.5 million||15.0 million||15.3 million|
|Average New Account Credit Lines*||$5,773||$5,649||$5,817||$5,466|
See TransUnions infographic here.
Swedish Fintech Unicorn to Challenge Paypal with U.S. Expansion (150sec), Rated: A
If Klarna is a threat to the online payments pioneer Paypal, it’s very much the challenger, with the latter enjoying 30 times greater revenue. Notwithstanding this, Klarna is making impressive gains, increasing transaction volume by 36% in 2018.
According to a recent press release, Klarna is now serving the needs of 60 million consumers and 130,000 merchants. It has achieved transaction rates in the region of 1 million transactions per day and believes it can generate an annual revenue of $1 billion in the foreseeable future.
Lendio Franchising Facilitates $ 50 Million to Small Businesses (Crowdfund Insider), Rated: A
Lendio Franchising, Lendio’s marketplace lending franchise program, announced on Tuesday it has facilitated $50 million in loans to over 1,800 small businesses around the U.S. According to Lendio, the loans through the franchise provide a boost to small businesses in industries ranging from healthcare to trucking, with an estimated economic impact of $165,505,834 across local economies.
Atlanta-Based LendingPoint #17 on Inc. 500 List of Fastest Growing Private Companies in the USA (The Daily Times), Rated: A
Inc. Magazine today ranked commerce platform LendingPoint No. 17 on its 37th annual Inc. 5000, the most prestigious ranking of the nation’s fastest-growing private companies. LendingPoint joins companies such as Microsoft, Dell, Pandora, Timberland, LinkedIn, Yelp, Zillow, and many other well-known names who gained their first national exposure as honorees on the Inc. 5000. LendingPoint has hit successive funding records year-over-year and is on pace to reach $100 million per month in loan originations by the end of 2019.
Fintech Firm OppLoans Named to Inc. 500 for Fourth Consecutive Year (Globe Newswire), Rated: A
OppLoans has been named to Inc. magazine’s prestigious 2019 Inc. 500 list for the fourth year in a row. Only four companies on this year’s list, including OppLoans, have placed on the Inc. 500 at least four or more times. With a three-year annual revenue growth of 1,435%, OppLoans placed #321 on the annual ranking of the fastest-growing companies in the U.S., 19 spots higher than the firm placed in 2018. OppLoans has achieved rankings of #340 (2018), #219 (2017) and #445 (2016).
FINICITY TO POWER DIGITAL SOLUTIONS FOR EMPLOYER STUDENT LOAN CONTRIBUTIONS (Finicity), Rated: A
Finicity, a provider of real-time financial data access and insights, announced today the rollout of its Student Loan Account Verification product, which will simplify employer benefit repayment programs, where employers are looking to contribute to or help repay employee’s student loans.
Fannie, Freddie to Consider Alternatives to FICO Scores (WSJ), Rated: A
One firm’s dominance over the credit scores used to vet many U.S. mortgages is getting a shake-up.
Fannie Mae and Freddie Mac, two mortgage-finance firms that back nearly half of U.S. mortgages, will have to consider credit-score alternatives to Fair Isaac Corp.’s FICO score when determining a mortgage applicant’s creditworthiness, under a new rule issued on Tuesday by the mortgage-finance giants’ federal overseer.
Zoca Loans Review: Installment Loans for Bad Credit Borrowers (Moneycheck), Rated: A
By going through a simple online application process, you have the chance to obtain between $300 and $1,000 – all of which can be funded the very same day.
HSBC launched a digital lending platform for online personal loans (Business Insider), Rated: A
HSBC USA partnered with Amount, a tech provider for financial institutions, to launch a digital lending platform that streamlines online personal loan applications. Consumers can evaluate loan options, submit applications online, and receive a credit decision within minutes.
HSBC will initially lend up to $30,000 with terms ranging from two to five years and it says funds will be available as quickly as the next day. The bank will charge fixed monthly payments starting 50 days after customers receive the loan. Amount’s platform — which has cumulatively originated $6 billion in loans to 800,000 customers — has been customized to HSBC’s preferences, including its proprietary risk models.
It’s Time For Regulators To Expand Opportunities For Smaller Investors (Forbes), Rated: A
In the past decade we’ve seen a new financial movement take shape: a focus on giving more investors a seat at the table. More and more people and organizations are realizing that investors of all income levels and backgrounds could (and should) have the opportunity to access more asset classes. In this technology-enabled age of access, data and transparency in investing, there is an opportunity to update our laws to ensure that smaller investors are not excluded from the opportunity to create wealth — opportunities that have emerged under the financial ethos of fintech: crowdfunding, peer-to-peer, financial literacy and inclusion.
Former Coinbase CTO Balaji Srinivasan Joins DeFi Blockchain Project Findora (Yahoo! Finance), Rated: B
Balaji Srinivasan, the former CTO of Coinbase, has just joined decentralized finance blockchain project Findora.
Tricolor Launches New, Affordable Auto Insurance for Low Income, Credit Invisible Consumers (Globe Newswire), Rated: B
Tricolor, the used vehicle retailer focusing on the sale and financing of vehicles to the Hispanic consumer, today unveiled a groundbreaking new affordable auto insurance option for low-income and credit invisible customers through its affiliate company Tricolor Insurance. After testing the product earlier this year, Tricolor will begin rolling out the new insurance offering throughout all of its markets in Texas and California.
Funding Circle Shares Rise on Positive Report (Crowdfund Insider), Rated: AAA
Last week, online lender Funding Circle (LSE:FCH) released its 6-month report and the shares have responded positively to the numbers. Six-month Revenue was reported at £81.4 million versus H1 2018 at £63.0 million – up 29%. Loans under management rose 37% to £3.54 billion and originations jumped 14% to £1.19 billion.
RateSetter to introduce stress testing to provision fund (P2P Finance News), Rated: AAA
RATESETTER is planning to introduce stress testing to its provision fund over the next financial year.
The ‘big three’ peer-to-peer lender’s provision fund is a buffer that protects investors against losses should any of its loans default. Borrowers pay cash into the provision fund in accordance with RateSetter’s assessment of their creditworthiness.
LendInvest Secures £200 Million Investment from the National Australia Bank to Expand Reach in Buy-to-Let Market (The Fintech Times), Rated: AAA
LendInvest has now raised over £1.8 billion of debt and equity from investors, making LendInvest one of the largest non-bank mortgage lenders in the country.
This new funding expands LendInvest’s capacity to lend in the UK Buy-to-Let market. LendInvest launched its first Buy-to-Let mortgage product in late 2017 after agreeing a substantial funding line with Citigroup. LendInvest has already lent more than £370 million in Buy-to-Let loans and is taking market share in the bank dominated market. In June this year, LendInvest also become the UK’s first Fintech business to securitise its own portfolio of assets worth £259 million, which received a AAA rating from Moody’s and Fitch.
SME online fashion retailers face barriers to innovation, Klarna (Retail Tech Innovation Hub), Rated: A
Small online fashion retailers in the UK are open to embracing innovative technologies, but various challenges are preventing widespread adoption, according to research by Klarna.
In terms of challenges, 53% said the cost of introducing flexible payment options was the biggest barrier to adoption.
SME online retailers look to overcome barriers to realise innovation ambitions (Retail Times), Rated: A
The research — conducted across 100 UK SME decision makers at online retailers in 2019 — shows the UK’s SMEs understand the need to embrace flexibility and innovation. Over the next 12 months they plan to prioritise investing in flexible payment options (49%) and e-commerce capabilities (48%) to meet consumer demand for a frictionless shopping experience.
Tandem Bank leverages Open Banking to offer competitive mortgages (Finextra), Rated: A
Mobile bank Tandem is developing the UK’s first crowd-designed mortgage for those hoping to get on the property ladder, allowing priced-out consumers to share their personal mortgage must-haves with the digital challenger.
5 things we learnt from Starling’s 2019 Annual Report (AltFi), Rated: A
1. Ireland is taking ages
Last November, when Starling actually filed its return, the bank reported a lending balance of £8.9m, or an average lending balance per active customer of £429.
That compares to Monzo which posted a total of £19.2m of lending by February 2019, along with an expected credit loss of £3.1m.
3. Marketplace revenue is tough to come by
For 2018 Starling reported just £35,000 of revenue from Marketplace commissions, versus the £1.47m it took from the interchange paid by retailers for customer card transactions.
4. We’ll have to wait until 2020 for Banking as a Service revenue
5. Starling is working on a financial AI
Ex-RateSetter business finance head launches new P2P platform (P2P Finance News), Rated: A
RATESETTER alumni Brian Cartwright has launched new alternative property lender Nexa Finance, with a focus on the East Midlands.
Cartwright (pictured), managing director at Nexa, previously worked as head of business finance at ‘big three’ peer-to-peer lender RateSetter.
His new venture, which bills itself as a regionally-focused business lender, aims to connect East Midlands-based small- and medium-sized enterprise (SME) property developers and house builders with funders.
Personal Finance Society publishes P2P guide following uptick in queries (P2P Finance News), Rated: A
MEMBERS of the Personal Finance Society (PFS) have been showing an increased interest in peer-to-peer lending, leading the PFS to produce its own ‘good practice’ guide to P2P.
The financial planning trade body has partnered with Octopus Investments to create the guide, which tells advisers that recommending P2P products could help them to increase their own assets under management, adding that “for suitable clients, it could prove a useful vehicle for excess cash holdings which may currently fall outside of the adviser’s view.”
Atom Bank, iwoca, Modulr Finance, & Currencycloud, All Benefit from BCR Grant (Crowdfund Insider), Rated: A
The BCR has awarded £10 million each to the following platforms:
- Atom Bank PLC – a digital challenger bank
- iwoca Ltd – an online lender for SMEs
- Modulr Finance Limited – a digital payment platform
- The Currencycloud Group Ltd – a cross border payment platform for businesses
I Never Got Paid From Winning Wonga Fantasy League in 2010 (TechRound), Rated: A
I worked for Wonga.com in 2010, back when you couldn’t even go to the bathroom without hearing their jingle on the radio. Like most offices today, everyone put in £10 to play in the office fantasy league and with Van Persie and Rooney in their prime, this was my year.
After doing some calculations, my £160 owed to me in 2010 would now be worth £2,752. (based on £24 per month for 9 years)
Without the price cap, you have 4 of those years at £30 per month. Making the total figure £3,040.
But again, I am being kind. This does not include default charges of £25 per month for every missed payment.
Shanghai-based Zendai closes two P2P units worth US$ 1.4 billion as Beijing intensifies crackdown (SCMP), Rated: AAA
Zendai Group, a closely held private investment company in Shanghai, abruptly shut down two peer-to-peer lending units valued at 10 billion yuan (US$1.4 billion), as Chinese financial regulators ratchet up measures to clean an industry fraught with frauds and defaults.
Another Peer-to-Peer Lending Platform Stumbles (Caixin Global), Rated: A
Laocaibao, a peer-to-peer (P2P) lending platform ultimately owned by private conglomerate Zendai Group, is the latest casualty of the troubles that have engulfed the scandal-hit industry over the past three years.
Laocaibao has stopped providing loans and Zendai’s investment and consulting arm, which directed clients to the platform, has fired employees, according to statements from the companies and investigations by Caixin.
Peer to Peer Lender Fincera Targeted by Local Chinese Government in Demand to Cease Lending Operations (Crowdfund Insider), Rated: A
According to a note from Fincera, the Hebei provincial government, where Fincera is based, has requested that Fincera “cease P2P business operations.”
Fincera Announces Intention to Sell Kaiyuan Finance Center (Benzinga), Rated: A
To protect the interests of all its stakeholders-investors, borrowers, brokers, and employees, Fincera has announced its intent to sell the Kaiyuan Finance Center, which has an estimated valued of over RMB4.0 billion.
Fincera is the largest Hebei-based company operating in the peer-to-peer lending industry, comprising over 90% of the province’s market with approximately RMB9.0 billion in unpaid principal balance.
Fincera Inc. (“Fincera” or the “Company”) (OTCQB:YUANF), a provider of internet-based financing and ecommerce services for small and medium-sized businesses (“SMBs”) and individuals in China, today announced that businesses operating within the P2P (peer-to-peer) lending industry in Hebei province, including the Company, have received requests by the Hebei provincial government to cease P2P business operations. The Company vehemently disagrees with the request and is taking steps to protect its many stakeholders, including initiating the process of moving its business registration to Beijing where local regulators are supportive of the P2P industry.
German mobile bank N26 eyes eventual IPO, CEO tells newspaper (Reuters), Rated: AAA
Berlin-based digital bank N26 is planning an eventual stock exchange listing, its chief executive has told a German newspaper.
Google exec joins N26 as chief banking officer (Finextra), Rated: B
N26 today announced the appointment of Thomas Grosse as Chief Banking Officer. The newly introduced role is yet another step towards realizing N26’s ambition to become the first truly global and fully digital retail bank. As Chief Banking Officer, Thomas will oversee the set-up of regulated N26 banks and bank partnerships within the N26 Group, thus ensuring the highest standards in product, processes and customer experience across all markets.
Thomas will begin his new role at N26 this October, reporting directly to N26’s co-founder and CFO, Maximilian Tayenthal.
European Fintechs Escape Troubles Afflicting Established Banks (Bloomberg), Rated: AAA
Its latest fundraising gave Klarna, which facilitates online installment payments, a $5.5 billion valuation. European fintech companies raised $3.3 billion in venture capital in the first half of 2019, up from $1.9 billion in the same period last year, according to data compiled by CB Insights. In contrast, an index of European Union banks has dropped 39% the past 18 months.
FlixMobility and Klarna raise a lot of money (Tech.eu), Rated: A
Tech.eu Podcast hosted by Natalie Novick and Andrii Degeler is a show in which we discuss some of the most interesting stories from the European technology scene and interview leading entrepreneurs and investors from across the region.
EstateGuru Seeks to Carve Out €5 Billion of European Real Estate Financing Market (Crowdfund Insider), Rated: A
EstateGuru, a crowdfunding platform based in Estonia, is out with a release predicting it will claim €3-5 billion of the European real estate financing by 2025
EstateGuru adds that approximately 70% of SMEs lack access to credit and this is a major constraint to their growth. The company claims that 12% of all loans are set to be financed by alternative providers, including crowdfunding platforms, by 2025 as it appears to be interested in expanding into other financing verticals.
Barclays releases £100,000 for unsecured SME lending through app and online banking (Finextra), Rated: A
New research released by Barclays has revealed that over half of the UK’s small and medium enterprises (SMEs) have woken up at night with a new business idea (57 per cent), while the most popular time for an idea to be dreamt up is between 2-3 am (28 per cent).
In a High Street banking first, Barclays has launched £100,000 unsecured lending for SMEs on its award winning app and online banking platform, with thousands of SMEs set to benefit from access to faster finance.
German Fintech Finleap Announces New Business Unit “Finleap Connect” (Crowdfund Insider), Rated: B
FinLeap, the fintech start-up platform behind Germany’s SolarisBank, announced on Wednesday the launch of its new business unit, FinLeap Connect. According to FinLeap, the fintech platforms finreach solutions and infinitec solutions will become part of this business unit.
Global Yields Crash, GSKY for sale, LC earnings (PeerIQ), Rated: AAA
Today, more than $15 Tn in sovereign debt trades at a negative yield. In Germany, for instance, bond investors have moved from charging 75 bps last year to a willingness to pay for the privilege of providing < 0% money for 10 years.
GreenSky shares sank ~37% after a strong earnings report was paired with news that the marketplace was exploring a potential sale or merger.
Alternative Data: The Great Equalizer To Lending Inequalities? (Forbes), Rated: AAA
Alternative data has come into the spotlight in financial services, and it presages a significant shift in credit availability for unbanked and underbanked consumers. There are about
Celsius Network (work/), the industry-leading cryptocurrency platform, announces updated terms for borrowers aiming to provide millions of users with increased accessibility to low-interest crypto-backed loans. In addition, Celsius has reduced its minimum requirement for loan requests to $1,500. Recently Celsius announced it will expand its lending operations throughout Europe.
The latest updates to Celsius Networks lending service include:
- Lowered minimum requirement for loan requests from $3,000 to $1,500
- Up to 30% discount for CEL token holders paying loan interest in CEL with yearly rates as low as 3.47%
- Borrowers can request a loan in USD or supported stablecoins
- Loans are issued the same day
- Members can apply through the Celsius mobile app or on the Celsius Network website
ONTOLOGY BLOCKCHAIN HIGH FIVES WITH DEFI (ICO Examiner), Rated: B
Ontology (ONT), a project offering linking and bridging solutions for multiple blockchains, has announced five new partnerships with companies operating in various geographical locations within the decentralised finance (DeFi) arena.
The latest handful of businesses to be attracted to Ontology’s framework of compatibility are Hong Kong registered Babel Finance, USA-focused crypto loan specialists SALT Lending, cryptocurrency services provider LendChain, Hong Kong-based Fountain Financial, and Chinese trading platform HOX.
CBA FY19 results a mixed bag, digital metrics positive and Klarna will be a hit (Verdict), Rated: AAA
CBA FY19 underlying net profit for the year to end June falls by 5% to A$8.49bn ($5.75bn). The bank’s overall results do not quite match analyst forecasts. But there is a strong argument that in all the circumstances the results represent a resilient full fiscal.
Release of the CBA FY19 earnings also serve to highlight the bank’s success in upping its digital strategy.
Operating income is 2% lower on margin pressure.
Net interest income is down by 1.2% on lower retail mortgages margins and higher funding costs.
Business lending increases by 4% while retail mortgage growth is also strong delivering 4% volume growth for the year.
Faircent raises fresh funding from investors led by Das Capital & Gunosy Capital (India Times), Rated: AAA
Faircent.com, a P2P lending company, has recently raised capital in a funding round. The latest funding, led by Singapore-based Das Capital and Gunosy Capital, also saw participation by existing investors Starharbor Asia Pte Ltd, and M&S Partners Pte Ltd (Sin Growth Partner Pte Ltd).
Keep retail indulgence in check (livemint), Rated: A
Overspending is a big problem for many. “They buy things they don’t need with money they don’t have to impress people they don’t like. Not passing a judgement here, but money does buy some kind of happiness for many,” said Rachit Chawla, chief executive officer, Finway, a registered non-banking financial company (NBFC).
Payday loans, digital lending platforms, and P2P lending have evolved, so has the penetration of credit card, personal loans, and the like. At a behavioural level, de-linking debt with shame has also made it easy for people to borrow.
Fintech Debt Investors Follow Equity Dollars Into Latin America (Forbes), Rated: AAA
News Comments Today’s main news: Morningstar completes DBRS purchase. Figure issues $85M in loans per month. Zopa chief says banks are trying to put fintech lenders in a box. DBRS praises Funding Circle. Yirendai’s Q1 results. Octopus expands into Germany. Today’s main analysis: Over 60% of purchase borrowers received mortgage rates under 4.5% last week (A […]
- Today’s main news: Morningstar completes DBRS purchase. Figure issues $85M in loans per month. Zopa chief says banks are trying to put fintech lenders in a box. DBRS praises Funding Circle. Yirendai’s Q1 results. Octopus expands into Germany.
- Today’s main analysis: Over 60% of purchase borrowers received mortgage rates under 4.5% last week (A MUST-READ).
- Today’s thought-provoking articles: How much time it takes to close a mortgage in 2019. Mortgage fintech innovation. Can commercial real estate be democratized? Can buy now, pay late lock in Gen Z shoppers at Abercrombie?
- Figure issues $85 million in loans per month. And the interesting thing is this is a blockchain company that doesn’t mention the blockchain. Congratulations on a great achievement.
- Over 60% of purchase borrowers received mortgage rates under 4.25% last week. A must-read from LendingTree.
- It takes less time to close a mortgage in 2019. Interesting.
- Mortgage fintech innovation. From PeerIQ.
- Can commercial real estate investment be democratized. I’m not a huge fan of the ‘democratization’ label, but this is a good read.
- Abercrombie & Fitch partners with Klarna on buy now, pay later; can they snag Gen Z shoppers? This story is a good illustration on how buy now, pay later in retail could be the next big competitive advantage.
- Guaranteed Rate breaks 15 company records. Congratulations.
- Cadre ramps up the proptech revolution.
- 7 reasons why long distance real estate investing isn’t as risky as you think.
- BlueVine hits $2 billion in total funding volume. Congratulations!
- Finitive secures $100 million credit facility for Platinum Auto.
- 35 stores that use Affirm.
- rue21 adds Klarna.
- Denver ranks fifth in business profitability nationally. Seattle is first. Interesting LendingTree study.
- Consumer borrowing climbs on bigger credit card balances.
- Small business loan approvals at big banks hit record highs.
- 45% of newlyweds went into debt for their wedding. Another LendingTree study.
- How fintech can help pay off student loans.
- Digital identity study shows changing consumer behaviors.
- 3 alternative financing options for small businesses.
- MoneyLion attempts to get usury case put in arbitration.
- Zopa CEO says big banks are trying to put fintech lenders in a box. A classic play. They feel threatened.
- Zopa to grow secured auto financing arm of business.
- DBRS backs Funding Circle on tightened lending strategy.
- Brits are more open with bank balance than Netflix password.
- Crowdcube sees record six months.
- Esme hits 60 million GBP lending milestone.
- Habito launches buy-to-let mortgages.
- FCA probes into retail finance misconduct increases by a third.
- OakNorth lends 19.5 million GBP to Care Concern Group.
- Klarna partners with We Out Here festival.
- Yirendai’s Q1 results.
- Court upholds ruling that put two P2P lending exex in prison for life.
- China Rapid Finance vs. X Financial.
- Foreign investment restrictions in P2P lending intermediaries.
- Bitmain co-founder launches Matrixport, a crypto lender.
- Octopus expands into Germany.
- P2P lending investors put 9 billion GBP to work in Europe.
- Revolut sets up hub in Berlin.
- Lagan Investments takes 10% stake in Property Bridges.
- Morningstar names president after DBRS acquisition. The big news of the day.
- OakNorth partners with Deutsche Bank.
- CoVEX Exchange to offer P2P crypto lending.
- United States
- Former SoFi CEO Mike Cagney’s New Blockchain Startup Is Issuing $ 85 Million In Loans A Month (Forbes), Rated: AAA
- Over 60% of Purchase Borrowers Received Mortgage Rates Under 4.25% Last Week (LendingTree), Rated: AAA
- It’s Taking Less Time to Close on a Mortgage in 2019 (LendingTree), Rated: AAA
- Mortgage Fintech Innovation (PeerIQ), Rated: AAA
- Guaranteed Rate Companies Breaks 15 Company Records with Exceptional June Production Volume (Yahoo! Finance), Rated: A
- Can Commercial Real Estate Investment Truly Be Democratized? (Commercial Observer), Rated: AAA
- Ryan Williams Is Bringing the ‘Proptech’ Revolution to Real Estate Investing (Fortune), Rated: A
- 7 Reasons Why Long Distance Investing Isn’t As Risky As You Think (Forbes), Rated: A
- BlueVine Reaches $ 2 Billion In Total Funded Volume (Bluevine), Rated: A
- Finitive Announces $ 100 Million Credit Facility For Platinum Auto (Crowdfund Insider), Rated: A
- Affirm lets you pay off a large online purchase over time — here are 35 stores that accept it (Business Insider), Rated: A
- Will Abercrombie & Fitch’s “Buy Now, Pay Later” Plan Lock in Gen Z Shoppers? (The Motley Fool), Rated: AAA
- rue21 is Totally on Trend with the Addition of Klarna (Yahoo! Finance), Rated: A
- Metro Denver businesses mostly seeing green, not red (Denver Post), Rated: A
- U.S. Consumer Borrowing Climbs on Bigger Credit Card Balances (Bloomberg), Rated: A
- Small Business Loan Approvals at Big Banks Hit Record Highs (Yahoo! Finance), Rated: A
- LendingTree Survey Finds 45% of Newlyweds Went into Debt for Their Wedding (PR Newswire), Rated: A
- How Using Fintech Can Help Pay Off Student Loans (Yahoo! Finance), Rated: A
- 3 Alternative Financing Options for Small Businesses in 2019 (Digital Journal), Rated: B
- New Study on Digital Identity Shows Changing Consumer Behaviors (Lend Academy), Rated: A
- Online Lending Startup Tries To Push Usury Suit To Arbitration (Law360), Rated: B
- United Kingdom
- Zopa boss Jaidev Janardana: big banks are trying to ‘put fintech lenders in a box’ (The Telegraph), Rated: AAA
- Zopa survey finds Brits are more open about bank balance than Netflix password (P2P Finance News), Rated: A
- Zopa looks to grow secured car finance offering (P2P Finance News), Rated: B
- Ratings agency backs Funding Circle strategy to tighten lending (AltFi), Rated: AAA
- Investor fintech demand drives record six months for Crowdcube (AltFi), Rated: A
- NatWest-backed Esme hits £60m lending milestone (AltFi), Rated: A
- Habito launches buy-to-let mortgages (Which), Rated: A
- FCA misconduct probes into retail financial services firms increase by a third (P2P Finance News), Rated: A
- OakNorth lends £19.5m to Care Concern Group (Fintech Finance), Rated: B
- Klarna teams up with UK festival We Out Here (Retail Tech Innovation Hub), Rated: B
- China/Hong Kong
- Yirendai Reports First Quarter 2019 Financial Results, Closing of Business Realignment Transactions with CreditEase (GlobeNewswire), Rated: AAA
- Reviewing China Rapid Finance Limited (XRF)’s and X Financial (NYSE:XYF)’s results (NBO News), Rated: A
- Court Upholds Ruling That Sent Two Peer-to-Peer Lending Executives to Prison for Life (Caixin Global), Rated: AAA
- Foreign Investment Restrictions in P2P Lending Intermediaries (Lexology), Rated: A
- Bitmain’s Affluent Co-Founder Establishes the New Crypto Startup Matrixport (All Stocks), Rated: A
- European Union
- Online Lender October Pushes into Germany as it Continues Expansion (Crowdfund Insider), Rated: AAA
- Investors are putting £9bn to work in P2P Lending across Europe, UK still dominating (AltFi), Rated: A
- Revolut brings the fintech battle to Berlin with a new hub (Yahoo! Finance), Rated: A
- Lagan Investments takes 10% stake in Property Bridges (Irish Times), Rated: A
- Morningstar Names Detlef Scholz President of Expanded Credit Ratings Organization (Morningstar), Rated: AAA
- Deutsche Bank in partnership talks with SoftBank-backed OakNorth (Reuters), Rated: A
- CoVEX Exchange — A Single Platform to Complete the Entire Crypto Lifecycle (Coinfomania), Rated: B
- Australia/New Zealand
- An alternative loan scheme could help 2.1 million Australians in financial distress (UNSW Sydney), Rated: AAA
- Alexa Chung partners with Klarna challenger Laybuy (AltFi), Rated: A
- The true role of the SME broker (Australian Broker), Rated: A
- ‘NiYO’ Raises US$ 35 Mn in Series B Round led by Horizons Ventures & Tencent (Yahoo! Finance), Rated: AAA
Former SoFi CEO Mike Cagney’s New Blockchain Startup Is Issuing $ 85 Million In Loans A Month (Forbes), Rated: AAA
Since the streamlined HELOC Mike Cagney, the co-founder and former CEO of fintech unicorn Social Finance (SoFi), knows that it is essential to focus on customer experience to build a loyal client base. Today, he is using that knowledge to create a platform aimed at driving mainstream adoption of blockchain technology in the financial sector.
Over 60% of Purchase Borrowers Received Mortgage Rates Under 4.25% Last Week (LendingTree), Rated: AAA
Mortgage Rate Distribution
- For 30-year, fixed-rate mortgages, approximately 60.1% of purchase borrowers received offers of 4.25% or less. That is up from 57% of borrowers the previous week. A year ago, 0.06% of offers were under 4.25%.
- Across all 30-year, fixed-rate mortgage purchase applications on LendingTree, 4.125% was the most common interest rate. This rate was offered to 14.3% of borrowers.
- Of 30-year, fixed-rate mortgage refinance borrowers, 72.8% received offers of 4.25% or less, which is up from 70.4% the previous week. A year ago, no refinance offers were under 4.25%.
- Across all 30-year, fixed-rate mortgage refinance applications, the most common interest rate was 3.875%, offered to 18.9% of borrowers.
Mortgage Rate Competition Index
- Across all 30-year, fixed-rate mortgage purchase applications on LendingTree, the index was 1.19, down from 1.22 the previous week.
- How big of a deal is it to get a mortgage APR that’s 1.19 percentage points lower than the competition? Over 30 years, that could translate to $56,826 in savings on a $300,000 loan (see Mortgage Savings Tracker graphic below).
- The index was wider in the refinance market at 1.35, up from 1.34 the previous week. Refinance borrowers could have saved $65,108 by shopping for the lowest rate.
It’s Taking Less Time to Close on a Mortgage in 2019 (LendingTree), Rated: AAA
- The time to close in new purchase transactions has been steadily declining, from 74 days in 2017 to 51 days in 2018 and just 40 days thus far in 2019.
- For refinances, the decline has been less dramatic: from 55 days in 2017 to 43 days in 2018 and just 38 days so far in 2019.
- Some of the decline can be attributed to lower mortgage volumes, as refinancings have been on a downward trend. But increased digitization is also playing a major role.
- Closing times vary based on the characteristics of the mortgage type and borrower. Having a higher credit score can knock a few days off: Purchase borrowers with scores above 760 averaged 38 days in 2019 compared with 45 days for those below 720. Refinancings did not show much variation by credit score.
- Loan-to-value ratios below 80% had shorter closing times for refinances, at 37 days compared with 42 days on mortgages with a ratio above 95% in 2019.
- Loan amounts also affect closing times, with lower amounts, perhaps surprisingly, taking the most time. Loans under $150,000 averaged 47 days compared with 39 days for those above the conforming limit ($484,350 in 2019). Why? Higher loan amounts are typically being made to more credit-worthy borrowers. Lower-priced homes may be in some form of distress or have some type of damage; lenders thus may require more extensive appraisals to better estimate the home’s value and this adds time to the process.
Mortgage Fintech Innovation (PeerIQ), Rated: AAA
In broad-brush strokes, mortgage innovation centers on:
- Customer experience (Better, Roostify, Blend, HomeCaptain) solutions are re-inventing the onerous mortgage with a digital experience, speeding decision times and opening up the lending buy box in the process.
- Intermediation (OpenDoor, HomeLight, Zillow) – Some platforms are stepping in between buyers and sellers to provide liquidity, capturing transaction fees in the process
- Data (House Canary, Zillow, Atom Data) – are amassing large data sets to providing accurate, standardized pricing models for investment decisioning
- Banking 2.0 (SoFi, ZeroDown) – seek to provide a range of banking or investing services to consumers
Guaranteed Rate Companies Breaks 15 Company Records with Exceptional June Production Volume (Yahoo! Finance), Rated: A
Guaranteed Rate Companies, one of the largest retail mortgage lenders in the nation, announces 15 new company milestones—breaking its monthly total locked volume for the fourth consecutive month in June.
Breaks its record of total locked volume with $5.31 Billion earned across more than 15,000 units
Can Commercial Real Estate Investment Truly Be Democratized? (Commercial Observer), Rated: AAA
Most real estate crowdfunding sites continue to highlight the equalizing benefits of the model. Fundrise provides “access to a once-unattainable investment class,” and Rich Uncles, which has a minimum of $5, wants to “level the playing field” for the average investor. The sites offer investments in funds that focus on income-producing assets, like single-tenant office, multifamily housing and convenience centers nationwide.
Jeff Holzmann, the former COO of crowdfunding site iintoo, says the definition of an accredited investor is very divisive: “You can have an economics degree, and if you make $199,000 a year, you can’t invest, but Kim Kardashian can walk right on up and buy a multifamily building for $200 million. Should our bar be set by how much money you make?”
Ryan Williams Is Bringing the ‘Proptech’ Revolution to Real Estate Investing (Fortune), Rated: A
Real estate is an industry notoriously stuck in its ways and slow to change. Cash-generating, bricks-and-mortar assets are at the very heart of the enterprise, and in many ways, business is conducted the same way it was 100 years ago. Until recently, real estate owners, investors and brokers had little patience for the kinds of technological advances that have swept through myriad other industries.
But that’s all changing now. Just as there’s fintech, medtech, edtech and regtech, so is there proptech—and there are few companies in the realm of real estate technology as closely watched as Cadre, led by a 31-year-old Blackstone Group and Goldman Sachs alum named Ryan Williams.
7 Reasons Why Long Distance Investing Isn’t As Risky As You Think (Forbes), Rated: A
In 2019 we have many ways we can verify the information we are provided when we invest outside of our own market. These methods will be the focus of this article. By the time you’re done with this, I think you’ll have a much better understanding of how to conduct due diligence, why out out state investing isn’t as risky as you thought, and why I’m such a big proponent of it
There is very little you can’t find out with a little online searching.
2. You Can Find Rent Estimates Easily
Websites like Rentometer and Craigslist make a preliminary rent search fast and easy.
7. You Can Find Comps Yourself Online
BlueVine Reaches $ 2 Billion In Total Funded Volume (Bluevine), Rated: A
This past month, BlueVine achieved a major milestone, having provided access to more than $2 billion in total working capital to businesses across the nation.
Finitive Announces $ 100 Million Credit Facility For Platinum Auto (Crowdfund Insider), Rated: A
Finitive announced on Monday its client Platinum Auto of Tampa Bay secured a $100 million credit facility through its platform. Platinum notably purchases auto loan contracts from a network of over 300 auto dealers in the southeast region of the U.S.
Affirm lets you pay off a large online purchase over time — here are 35 stores that accept it (Business Insider), Rated: A
You can apply for a loan as you’re shopping at one of many Affirm’s partner stores, which include women’s and men’s fashion, furniture, sports and fitness, electronics, jewelry, and watch brands.
You can see which online retailers accept Affirm below.
They’re divided by category and we’ve also designated which ones offer loans starting at 0% APR with an asterisk.
Will Abercrombie & Fitch’s “Buy Now, Pay Later” Plan Lock in Gen Z Shoppers? (The Motley Fool), Rated: AAA
Abercrombie & Fitch (NYSE:ANF) recently partnered with payment solutions provider Klarna to let U.S. shoppers split purchases into up to four interest-free payments over two months. A&F is aiming this “buy now, pay later” system — which its rival Urban Outfitters (NASDAQ:URBN) has also adopted — at younger shoppers with less spending power.
But will “buy now, pay later” work?
Only a third of millennials have credit cards according to Bankrate. The average millennial in the U.S. also has a net worth of just $8,000 according to Deloitte, which gives them significantly less spending power than previous generations. Most Gen Z shoppers don’t have credit cards yet. They mostly use debit cards or linked payment apps, which restrict purchases to the amount of cash in their bank accounts.
rue21 is Totally on Trend with the Addition of Klarna (Yahoo! Finance), Rated: A
Klarna, the global alternative payments provider, is getting trendy with the Millennial favorite fashion brand rue21. Customers can choose to pay with four equal payments collected bi-weekly – with no interest or fees. With Klarna, these cool customers get the ability to stay ahead of trends even faster with a smooth checkout and a payment option that boosts flexibility and purchase power.
The necessity for businesses to keep up with the customer is increasingly important considering that U.S. shoppers admit to buying clothes and accessories online an average of 10 times a year. For Gen Z shoppers, aged 16-24, this number increases to 18 times per year, with nearly a quarter (23%) of them admitting to shopping online 1-3 times per month. Millennials are shown to shop online 14 times per year and the 55+ age group, 8 times per year. Considering these Millennial and Gen Z demographics are credit card averse and debt conscious, Klarna delivers an appealing and accessible method for shoppers to take control of their finances in a manageable way.
Metro Denver businesses mostly seeing green, not red (Denver Post), Rated: A
Of 42,610 businesses in metro Denver, 29,560 or 69.4 percent reported turning a profit, according to an analysis from online lender LendingTree.
That placed fifth out of the 50 metro areas that LendingTree ranked based on Census Bureau data. Seattle had a business profitability rate of 70.9 percent, making it the leader nationally. The only other cities ahead of Denver were Louisville, Ky.; Indianapolis and Portland, Ore.
U.S. Consumer Borrowing Climbs on Bigger Credit Card Balances (Bloomberg), Rated: A
U.S. consumer debt climbed in May at about the same pace as a month earlier, led by the largest advance in revolving debt outstanding since October, suggesting Americans’ favorable economic outlook is underpinning continued spending.
Total credit rose $17.1 billion from the prior month, in line with the median estimate of economists, following a $17.5 billion gain in April, Federal Reserve figures showed Monday. While credit card and other revolving debt outstanding increased at a faster rate, non-revolving credit posted the smallest increase in almost a year.
Small Business Loan Approvals at Big Banks Hit Record Highs (Yahoo! Finance), Rated: A
Approval rates for small business loan applications inched up to yet another record high of 27.6% at big banks ($10 billion+ in assets) in June, while the approval percentage also climbed at small banks, hitting 50% for the first time in 2019, according to the Biz2Credit Small Business Lending Indexreleased today.
Small bank approvals of small business loan applications climbed one-tenth of a percent from 49.9% in May to 50% in June.
Small business loan approval rates among alternative lenders dropped one-tenth of a percent to 57.0% in June, down a notch from 57.1% in May.
LendingTree Survey Finds 45% of Newlyweds Went into Debt for Their Wedding (PR Newswire), Rated: A
Approximately 45% of newlyweds between the ages of 18 and 53 went into debt to pay for their wedding. And once married, nearly half of the newlyweds who obtained wedding-related debt said money has caused them to consider divorce. On the flip side, only 9% of couples without wedding-related debt contemplate divorce.
How Using Fintech Can Help Pay Off Student Loans (Yahoo! Finance), Rated: A
Companies like SoFi, Laurel Road and Splash Financial are just a few of the fintech industry names that have made their way into the student lending world.
Credible. This is a platform that allows you to compare student loan refinance rates from eight different lenders.
LendKey. Similar to Credible, Lendkey is a platform that allows the borrower to compare refinance rates side by side.
CommonBond. CommonBond for Business offers a flex contribution program that includes an option to directly contribute to paying down employee student loans, or to work with employees on financial literacy techniques for reducing their debt.
Gradifi. Gradifi is another fintech offering refinance options, bundled with employee benefits packages called SLP, or “student loan paydown”.
Earnest. This fintech offers refinance options to individuals with a more limited credit history that may not qualify for other traditional options.
FutureFuel. FutureFuel uses behavioral economics, which is the study of human behavior to explain economic decisions people make.
3 Alternative Financing Options for Small Businesses in 2019 (Digital Journal), Rated: B
Online finance is a very popular option to emerge of late. A few click on the website can bring about quick processing and loan approval.
Another alternative financing option is that of merchant cash advance.
Crowdfunding is an innovative and extremely popular way to raise money for new ideas, concepts, prototypes and creative products.
New Study on Digital Identity Shows Changing Consumer Behaviors (Lend Academy), Rated: A
Today, according to Pew Research Center more than 50 million American adults are mobile-only consumers.
Each year, IDology publishes a Consumer Digital Identity Study aimed at giving businesses visibility into how consumer preferences and opinions related to identity and fraud are shifting. This year’s study confirms the continued movement toward mobile, finding that in the last 12 months, for the first time, consumers opened more new accounts online with their mobile devices than on computers. A closer look at the data shows that 50 million American consumers (20% of all online adults) registered for new accounts exclusively on a mobile phone, up 10% from last year. This growing number has implications for financial service providers as they strive to keep fraud out while giving consumers a seamless digital experience.
Online Lending Startup Tries To Push Usury Suit To Arbitration (Law360), Rated: B
Online lending startup MoneyLion told a North Carolina federal court Tuesday that a suit over alleged unlicensed payday lending belongs in arbitration, arguing the proposed class of borrowers had signed valid arbitration agreements when taking out their loans.
Zopa boss Jaidev Janardana: big banks are trying to ‘put fintech lenders in a box’ (The Telegraph), Rated: AAA
In just a few months, a string of Zopa’s rivals in peer-to-peer lending have collapsed. Others have exited the sector altogether.
The latest company to fall into administration, Lendy, resulted in £165m of customer cash being put on the line and affected more than 20,000 investors.
Zopa survey finds Brits are more open about bank balance than Netflix password (P2P Finance News), Rated: A
A survey of 2,000 adults by the peer-to-peer lender found that 47 per cent of respondents felt more comfortable revealing details about their bank accounts with their partner than their most intimate secret, while the same percentage would prefer to give an insight into their finances over their Netflix password.
Zopa looks to grow secured car finance offering (P2P Finance News), Rated: B
ZOPA is readying to launch its secured car finance product as a direct offer on its website, as it looks to expand this segment of the business.
Ratings agency backs Funding Circle strategy to tighten lending (AltFi), Rated: AAA
SME focused peer-to-peer lender Funding Circle was correct to proactively take the decision to tighten its lending criteria in pulling back from higher-yielding lower-quality loans, according to ratings agency DBRS.
Investor fintech demand drives record six months for Crowdcube (AltFi), Rated: A
Crowdcube saw revenues soar 39 per cent to £3.72m in the first half of 2019, compared to the same period in 2018, with £103.4m pledged to companies through the platform.
NatWest-backed Esme hits £60m lending milestone (AltFi), Rated: A
Esme Loans said it has hit over £60m of lending to UK small businesses just two years after its launch.
The small business lender unit said its loans have leapt 20 per cent since the end of April.
Habito launches buy-to-let mortgages (Which), Rated: A
Online mortgage broker Habito has launched a comprehensive range of buy-to-let mortgages, as it makes its first foray into lending.
The brokers offers a range of two and five-year loans for landlords, as well as more niche three, seven and 10-year fixed terms.
FCA misconduct probes into retail financial services firms increase by a third (P2P Finance News), Rated: A
THE NUMBER of Financial Conduct Authority (FCA) cases opened into misconduct in retail financial services has increased by 29 per cent in the past year.
The number of cases has increased to 101 for the 12 months ended 31 March, up from 78 the previous year, the FCA said in its annual report on Tuesday.
The regulator also said that the overall number of enforcement cases it is undertaking is up by 31 per cent over the past year – rising to 650 from 496 at the beginning of the year.
OakNorth lends £19.5m to Care Concern Group (Fintech Finance), Rated: B
Klarna teams up with UK festival We Out Here (Retail Tech Innovation Hub), Rated: B
PayTech venture Klarna has announced a partnership with new jazz and electric festival We Out Here.
It will unveil a ‘Smoooth Sanctuary’ at the event, which will be held in Cambridgeshire in August.
Yirendai Reports First Quarter 2019 Financial Results, Closing of Business Realignment Transactions with CreditEase (GlobeNewswire), Rated: AAA
First Quarter 2019 Operational Highlights
Consumer Credit—Yiren Credit
- Total loan originations in the first quarter of 2019 reached RMB 10.9 billion (US$1.6 billion), representing a decrease of 45% from RMB 19.8 billion in the first quarter of 2018.
- Cumulative number of borrowers served reached 4,404,812, representing an increase of 15% from 3,824,341 in the first quarter of 2018.
- Number of borrowers in the first quarter of 2019 was 149,715, representing a decrease of 48% from 287,166 in the first quarter of 2018.
- The percentage of loan volume generated by repeat borrowers was 38.8% in the first quarter of 2019.
- Total outstanding principal balance of loans reached RMB 63,213.8 million (US$9,419.2 million) as of March 31, 2019, representing a decrease of 16% from RMB 75,271.5 million March 31, 2018.
Reviewing China Rapid Finance Limited (XRF)’s and X Financial (NYSE:XYF)’s results (NBO News), Rated: A
This is a contrast between China Rapid Finance Limited (NYSE:XRF) and X Financial (NYSE:XYF) based on their analyst recommendations, profitability, institutional ownership, risk, dividends, earnings and valuation. The two companies are Credit Services and they also compete with each other.
Earnings & Valuation
|Gross Revenue||Price/Sales Ratio||Net Income||Earnings Per Share||Price/Earnings Ratio|
|China Rapid Finance Limited||1||0.27||N/A||-0.85||0.00|
Table 1 shows the top-line revenue, earnings per share (EPS) and valuation for China Rapid Finance Limited and X Financial.
Court Upholds Ruling That Sent Two Peer-to-Peer Lending Executives to Prison for Life (Caixin Global), Rated: AAA
Shanghai Kuailu Investment Group Co. Ltd., along with two affiliated companies, and 15 defendants were convicted of fraudulent fundraising or illegal fundraising or both, according to the final ruling (link in Chinese) made by the Shanghai High People’s Court on Tuesday.
Kuailu, along with its affiliates, illegally raised more than 43.4 billion yuan ($6.3 billion) from the public, causing 40,000 people to take financial losses, the court said.
Foreign Investment Restrictions in P2P Lending Intermediaries (Lexology), Rated: A
The Interim Administrative Measures for the Business Activities of Peer-to-Peer Lending Information Intermediaries define “peer-to-peer lending” as direct lending/borrowing realized between peers on an internet platform. Peers include natural persons, legal persons and other organizations.
Bitmain’s Affluent Co-Founder Establishes the New Crypto Startup Matrixport (All Stocks), Rated: A
With the hope of capitalizing on the recent rise of the Bitcoin price, the co-founder of the mining giant Bitmain, Wu Jihan, has organized a group to develop “Matrixport,” a financial services startup for cryptocurrencies. According to its CEO Ge Yuesheng, Matrixport will function as a one-stop-shop for not just safekeeping of digital assets but also for crypto lending and over-the-counter trading.
Online Lender October Pushes into Germany as it Continues Expansion (Crowdfund Insider), Rated: AAA
Marketplace lending platform October, which is based in France, has expanded in Germany, according to a blog post by CEO and founder Oliver Goy.
October has selected Thorsten Seeger, a Funding Circle veteran, as CEO of October Deutschland as its plots its ongoing expansion across Europe. October currently operates in France, Spain, Italy, and the Netherlands.
Investors are putting £9bn to work in P2P Lending across Europe, UK still dominating (AltFi), Rated: A
The peer-to-peer lending market is now funding more than £9bn of loans across Europe each year with two thirds (67 per cent) of this funding coming through UK platforms.
Revolut brings the fintech battle to Berlin with a new hub (Yahoo! Finance), Rated: A
British fintech startup Revolut is opening a new European tech centre in Berlin, the home turf of its online-banking rival N26.
Lagan Investments takes 10% stake in Property Bridges (Irish Times), Rated: A
Lagan Investments, a fund founded by the North’s biggest house-builder, Kevin Lagan, has taken a 10 per cent stake in peer-to-peer lender Property Bridges and is to supply it with €5 million in lending capital.
Morningstar Names Detlef Scholz President of Expanded Credit Ratings Organization (Morningstar), Rated: AAA
Morningstar, Inc. (Nasdaq: MORN) has named Detlef Scholz as president of its expanded, global ratings organization. The leadership announcement comes as Morningstar today completes its previously announced acquisition of DBRS, the world’s fourth largest credit ratings agency, for a purchase price of US$669 million.
Scholz will assume his new role Aug. 1, 2019 and report to Morningstar Chief Executive Officer Kunal Kapoor.
View the Morningstar/DBRS overlapping ratings.
Deutsche Bank in partnership talks with SoftBank-backed OakNorth (Reuters), Rated: A
Deutsche Bank (DBKGn.DE) is in talks with SoftBank-backed (9984.T) British fintech firm OakNorth to use the latter’s credit analysis and monitoring platform, a source with knowledge of the discussions told Reuters.
CoVEX Exchange — A Single Platform to Complete the Entire Crypto Lifecycle (Coinfomania), Rated: B
P2P loan: The CoVEX platform also implementing a decentralized p2p lending service. This allows users across the world to receive loans in lesser time and even reduces the repayment fee while at the same time protecting the interests of the lender.
An alternative loan scheme could help 2.1 million Australians in financial distress (UNSW Sydney), Rated: AAA
A social lending scheme could help bridge the gap between traditional lenders and government welfare for the 2.1 million Australians under high levels of financial stress.
Alexa Chung partners with Klarna challenger Laybuy (AltFi), Rated: A
Payments platform Laybuy has struck a new retail partnership with fashion brand of Alex Chung – called ALEXACHUNG – allowing customers to spread the cost of purchases over six equal weekly payments.
New Zealand’s largest digital buy now, pay later app launched in March with its first partnership with Footasylum.
The true role of the SME broker (Australian Broker), Rated: A
Yet SMEs are being stiffed by traditional lending practices: 44% of small businesses have been knocked back for finance in the last 12 months. Put simply, SMEs are being underserved and ignored by the banks.
‘NiYO’ Raises US$ 35 Mn in Series B Round led by Horizons Ventures & Tencent (Yahoo! Finance), Rated: AAA
Indian new-age digital banking start-up NiYO Solutions has raised US$ 35 million in Series B funding round from Horizons Ventures, Tencent and existing investor, JS Capital. NiYO is founded by banking veteran Vinay Bagri and technology veteran Virender Bisht. NiYO had previously raised US$ 14 million in funding rounds led by Prime Venture Partners. With the current round the total fund raised by NiYO is US$ 49 million.
Though the 2008-09 crisis scarred a lot of real estate investors, the fact is that the US real estate sector has been on a secular growth spree in this decade. The sector plays an integral role in the US economy and contributed $1.15 trillion to the country’s economic output in 2018, which is 6.2% of the nation’s […]
The post How QuantmRE Tokenizes Real Estate on the Blockchain appeared first on Lending Times.
Though the 2008-09 crisis scarred a lot of real estate investors, the fact is that the US real estate sector has been on a secular growth spree in this decade. The sector plays an integral role in the US economy and contributed $1.15 trillion to the country’s economic output in 2018, which is 6.2% of the nation’s GDP. As a matter of fact, till Q3 2018, individuals owned US$25.6 trillion in real estate, and total mortgages amounted to US$10.3 trillion, which implies that home equity stood at US$15.2 trillion until Q3 2018. That’s a record in itself. Approximately 14.7 million homes have 50% or more of their total equity in their houses.
This represents a massive untapped financial asset for American homeowners. But wary of piling on more debt and with selling the house not an option, homeowners need a new solution to monetize their homes. QuantmRE has brought to market a win-win framework with its shared equity contract agreements. In conversation with Matthew Sullivan, founder/CEO of the company, Lending Times gets a front seat view on how the blockchain-powered solution will help millions of homeowners generate additional liquidity without taking on debt.
The QuantmRE Solution
The fundamental concept behind the company’s platform is “the home owner has equity and wants cash, whereas, the investor has money and wants equity.” QuantmRE’s solutions enable an individual to realize the value of their home’s equity without incurring any further debt. QuantmRE’s funds will purchase a fraction of the owner’s home equity and then tokenize it, building a marketplace for both owners and investors, with new financial opportunities. How?
The explanation lies ahead.
Structure of the Contracts
The QuantmRE contracts are flexible to cater to the needs of different stakeholders and are built to suit varied interests of the homeowners – with some contracts having a 10-year commitment attached to them and some contracts committing for 20-30 years. Along with this, the equity ownership framework will rely on risk profiles of the different contracts.
To illustrate, when the owner wants to part with 10% of the current value of their home, they are selling the future rights to its appreciation. When the owner sells the house in the future, they will provide the investor with a 15%-18% of the value of house. Thus, the company is buying 15%-18% of the future value of the owner’s house at 10% of the present value. This 10% is the shared equity. The company will cap the return in the initial years and the ROI will also be capped at 18%-20% per year.
These are strictly real estate contracts and not loans; here the homeowners simply agree to share the present or future appreciation or depreciation of the value of their real estate. The investor is investing in a real estate option and not investing in any debt.
Under the scenario where the house owner does not sell the house, the contract shall either be refinanced under the same terms as before or shall be renewed on new agreeable terms on all sides.
What are the returns for the investors?
Investor in the funds: The fund will buy the equity instruments from individual homeowners, and the investors will benefit from the overall diversification of the fund. The returns are usually asymmetric and are geared for strong positive alpha and downside protection (due to the structure where it pays for 10% on Day One but receives 15%-18% of future value). Even in the scenario where the house prices remain flat or fall marginally, the funds shall still deliver positive returns. But there is still risk involved, as the downside buffer is limited to an extent.
The company is developing a cryptocurrency token with real intrinsic value: EQRE. These tokens shall be backed by audited pooled real estate assets; the tokens derive their value from the equity interests in the single-family owner-occupied homes. These tokens will be launched in the near future.
It provides a platform to the owners and investors to tap the previously illiquid real estate asset class in a stock market environment enabling the fractional interests in the real estate investments to be traded on the blockchain. The tokenization of real estate will allow small mom and pop investors to diversify their real estate holdings and provide institutional players a platform for liquidity in their real estate investments.
QuantmRE To Date
QuantmRE was founded in December 2017 and has successfully originated close to 100 transactions of over $25 million across a few states. Albeit, currently these transactions are not all QuantmRE contracts. Since its inception, the company has developed its technology, contracts, and design. and is just a few weeks away from launching its EQRE token.
As far as funding goes, the company raised close to US$2 million in 2018 in a seed round. The company plans to raise $5 million for working capital and expansion.
The company offers homeowners an opportunity to liquidate a part of their house without taking on more debt. Investors get to partake in the growth of single-family residential units. This is structured through a shared equity contract. These contracts will further back the token of the company that can be traded. The token of the company (EQRE) is being developed and shall be soon launched. QuantmRE plans to integrate the blockchain and cryptocurrency technology with the real estate sector allowing for liquid profitable real estate investments. The company has its eyes on the $15 trillion unmortgaged equity in US homes and is poised to leverage blockchain tech to make it a strong investment proposition.
Written by Heena Dhir.
The post How QuantmRE Tokenizes Real Estate on the Blockchain appeared first on Lending Times.
News Comments Today’s main news: SoFi launches ETF for gig market. LendingClub’s higher fees lead to earnings win. CrowdStreet hits $500M in real estate investments. Funding Circle offers manual lending in foreign markets. Marcus delays German launch. Today’s main analysis: LendingClub, GreenSky, and OnDeck earnings. Today’s thought-provoking articles: GDP growth continues. The pros and cons […]
- Today’s main news: SoFi launches ETF for gig market. LendingClub’s higher fees lead to earnings win. CrowdStreet hits $500M in real estate investments. Funding Circle offers manual lending in foreign markets. Marcus delays German launch.
- Today’s main analysis: LendingClub, GreenSky, and OnDeck earnings.
- Today’s thought-provoking articles: GDP growth continues. The pros and cons of leveraged loans. Affirm, Kabbage, and Tala. Managed security for fraud threats. International P2P lending volumes.
- SoFi launches gig-focused ETF. There are 56.7 million freelance workers in the U.S. The gig market, already huge, is growing. Forbes reported last year that 35 percent of the workforce was made up of gig workers, and that number is expected to increase to 43 percent by 2020.
- LendingClub’s higher tranaction fees account for earnings. As a result, the company’s stock price shot up to $3.70.
- Still, LendingClub registered a net loss of $11.25 million.
- One analyst expects LendingClub to produce an adjusted EBITDA margin of 20% by end of year.
- A look at LendingClub, GreenSky, and OnDeck Q1 earnings. A Lend Academy analysis.
- GDP continues to grow. A PeerIQ analysis.
- CrowdStreet hits $500 million in real estate investments.
- The pros and cons of leveraged loans. An excellent read.
- Affirm, Kbbage, and Tala. How much each company has been funded.
- Managed security for fraud threats. A must-read report.
- BlackRock is creating a stock-lending platform.
- Avant settles with the FTC for $3.85 million.
- TransUnion says delinquent borrowers can benefit from another loan.
- Monzo to launch in U.S. this summer.
- Resolve launches B2B financing platform.
- Kabbage partners with builders association for minority business funding.
- Fig Loans gets Community Development Institution certification.
- Consumer Financial Protection Bureau proposed new lending rules.
- A look at Genesis Capital’s lending business.
- Ocrolus, inFactor partner on Merchant Cash Advance.
- Funding Circle offers manual lending in foreign markets.
- Esme Loans hits 50 million GBP lending milestone.
- Marcus reaches 250,000 customers in the UK.
- Investors are more comfortable with P2P ISA.
- What’s the best provision fund structure?
- Tandem recognized as best new digital bank.
- OakNorth launches mortgages for high net worth individuals and people with atypical income streams.
- P2P lending volumes for April 2019.
- The credit card with a carbon spending limit.
- Over 50 banks trial trade finance app on blockchain.
- What are real estate tokens?
- How one crypto lender is helping Bitfinex raise $1 billion.
- Cred partner with Tron, Bitcoin.com on crypto lending.
- Fvndit launches $10 million equity-backed digital security offering.
- TomoChain, Constant partner on stablecoin.
- Creci wins Innovate Finance Global Summit award.
- China: Jiayin Group prepares $40 million IPO in U.S.
- Germany: Marcus delays launch.
- Mexico: Nubank to open office.
- Southeast Asia: Brankas to bring banks, e-commerce into digital era.
- China: P2P lending is in crisis.
- Indonesia: Singapore-based Validus Capital to launch.
- Australia: YOZO offers business lending.
- United States
- SoFi launches gig-focused ETF (TechCrunch), Rated: AAA
- LendingClub Records Higher Transaction Fees on the Way to Earnings Beat (TheStreet), Rated: AAA
- Higher Fees Drive LendingClub’s Earnings Beat (PYMNTS), Rated: A
- Why LendingClub Stock Leapt 12.4% Today (The Motley Fool), Rated: B
- LendingClub, GreenSky and OnDeck Q1 2019 Earnings Results (Lend Academy), Rated: AAA
- Strong GDP Growth Continues (PeerIQ Email), Rated: AAA
- Online marketplace reaches $ 500M in online real estate investments (Real Estate Weekly), Rated: AAA
- The Pros And Cons Of Leveraged Loans (Seeking Alpha), Rated: AAA
- BlackRock is building a team of 30 data scientists to create a next-generation stock-lending platform (Business Insider), Rated: A
- ONLINE LENDER SETTLES WITH FTC FOR $3.85 MILLION (Lawyers and Settlements), Rated: A
- Providing Additional Liquidity to Some Delinquent Borrowers Can Actually be a Win-Win (Yahoo! Finance), Rated: A
- Monzo plots US launch as soon as this summer (The Telegraph), Rated: A
- Affirm, Kabbage, Tala — The Big Three of Online Loans (Bitnews Today), Rated: AAA
- Resolve launches as a B2B online financing service (Digital Commerce 360), Rated: A
- Kabbage Teams with BTEA to Fuel Access to Funding for Women- and Minority-Owned Businesses (Finanzen), Rated: B
- In The Face Of Growing Fraud Threats, Finance Firms Should Look At Managed Security (Forbes), Rated: AAA
- Fig Loans Becomes First-Ever FinTech to Receive CDFI Certification (Yahoo! Finance), Rated: A
- CFPB plan a mixed bag for debt collectors (American Banker), Rated: A
- Behind The Scoop: An inside look at Genesis’ lending business (The Block Crypto), Rated: A
- Ocrolus, inFactor Partner on End-to-End Automation for Merchant Cash Advance Lenders (Ocrolus), Rated: B
- United Kingdom
- Funding Circle still offers manual lending in other markets (P2P Finance News), Rated: AAA
- Digital Lending Platform Esme Loans Hits £50 Million of Lending to UK Businesses (Crowdfund Insider), Rated: A
- Goldman Sachs’ digital savings account Marcus just reached a UK milestone (AltFi), Rated: A
- Investors are getting more comfortable with the P2P ISA (AltFi), Rated: A
- What is the best provision fund structure? (P2P Finance News), Rated: A
- Tandem Recognized as Best New Digital Bank (Crowdfund Insider), Rated: B
- OakNorth launches mortgages for HNWIs, SMEs, and clients with atypical income streams (Fintech Finance), Rated: B
- Jiayin Group Readies $ 40 Million U.S. IPO (Seeking Alpha), Rated: AAA
- P2P lending in crisis as regulatory bubble pops (Technode), Rated: A
- European Union
- Goldman Delays Marcus’ Germany Launch (PYMNTS), Rated: AAA
- International P2P Lending Volumes April 2019 (P2P-Banking), Rated: AAA
- This credit card won’t let you buy anything else after you’ve hit your annual carbon limit (Fast Company), Rated: A
- Over 50 Banks, Firms Trial Trade Finance App Built With R3’s Corda Blockchain (CoinDesk), Rated: A
- Real Estate Tokens: What They Are and How to Invest (Bitcoin Market Journal), Rated: A
- Bitfinex Releases Whitepaper to Confirm $ 1 Billion Initial Exchange Offering (CryptoGlobe), Rated: A
- Cred Partners with Tron and Bitcoin.com to Provide Crypto Lending and Borrowing Services (Bitcoin Exchange Guide), Rated: A
- Fvndit Launches $ 10M Equity-Back Digital Security Offering (Financial Buzz), Rated: A
- TomoChain teams up with Constant to bring first stablecoin to its platform (Cryptoninjas), Rated: B
- Creci Wins its Category at the Innovate Finance Global Summit (PR Web), Rated: B
- YOZO a quick and open answer to business lending maze (Mirage News), Rated: A
- Southeast Asia
- Brankas wants to bring Southeast Asia’s banks and e-commerce into the digital era (TechCrunch), Rated: AAA
- Singapore Fintech Firm Heading into Indonesia (Retail News), Rated: A
- Latin America
- Brazil fintech Nubank opens Mexico office as it seeks Latam expansion (Reuters), Rated: AAA
SoFi launches gig-focused ETF (TechCrunch), Rated: AAA
Today, the company announced a new exchange-traded fund (ETF) product focused on the gig economy. GIGE, which trades on Nasdaq, is an actively managed fund advised by Toroso Investments that allows investors to capitalize on this hot sector of the economy. Toroso offers a range of services around creating and managing ETFs.
The company also announced the creation of an ETF focused on high-growth stocks. That ETF, which trades as SFYF on the NYSE, is designed to identify and capture the growth of the top 50 of the 1,000 largest publicly traded issues.
LendingClub Records Higher Transaction Fees on the Way to Earnings Beat (TheStreet), Rated: AAA
Online-loan marketplace LendingClub (LC – Get Report) was rising more than 14% Wednesday to $3.70 after reporting a surprise profit in the first quarter, though the company’s guidance was short of expectations.
LendingClub reported a 22% increase in transaction fees that led to a 15% increase in revenue to $174.4 million and adjusted earnings of 2 cents per share. Wall Street was expecting the company to report revenue of $169.4 million and a loss of 3 cents per share.
Higher Fees Drive LendingClub’s Earnings Beat (PYMNTS), Rated: A
The marketplace lending platform reported adjusted net loss of $11.25 million, or 3 cents a share — red ink, but less than the 4 cents per share loss analysts were forecasting.
That stronger-than-expected revenue outcome was driven by stronger-than-expected loan originations during the first quarter, which rose 18 percent year-on-year to $2.73 billion. That increase in originations drove an increase in transaction fees, which were up 22 percent to $135.4 million.
For the second quarter, the company expects net revenue between $185 million and $195 million, with the high end slightly below the average analyst estimate of $196.7 million.
Why LendingClub Stock Leapt 12.4% Today (The Motley Fool), Rated: B
Wedbush believes LendingClub’s improving operating efficiency will help it produce an adjusted EBITDA margin of 20% by the end of 2019. The firm also expects LendingClub to grow revenue by 12%-15% annually in the coming years.
LendingClub, GreenSky and OnDeck Q1 2019 Earnings Results (Lend Academy), Rated: AAA
LendingClub rounded out 2018 originating the most loans in the company’s history at $10.9 billion. With their Q1 2019 results, the company is off to a great start in 2019. Originations were $2.7 billion, up 18% year over year. The company reported that application growth was 31% over the same period.
Net revenues came in above high end guidance of $172 million at $174.4 million for the quarter, up 15% year over year. GAAP Consolidated Net Loss was $(19.9) million, compared to $(31.2) million in Q1 2018. Finally, the company delivered adjusted EBITDA of $22.6, up 47% year over year and well above their projections of $13-$18 million. LendingClub is on track to become adjusted net income profitable over the second half of 2019.
GreenSky Q1 2019 Earnings
In Q1 2019 GreenSky increased transaction volume on the platform 20% to $1.2 billion. They also grew revenue 22% to $103.7 million form the prior year period. GAAP Net Income in Q1 2019 was $7.4 million. The company had aggregate commitments of $11.8 billion from nine bank partners of which $4.5 billion remain unused. The company ended the quarter with $268 million in cash.
OnDeck Q1 2019 Earnings
Originations fell for the quarter to $636 million compared to $658 million for the previous quarter. This was attributed to OnDeck tightening their credit box during the quarter. The company shared that their line of credit product reached an all time high of $150 million for the quarter.
Strong GDP Growth Continues (PeerIQ Email), Rated: AAA
Unemployment fell to 3.6% – the lowest level since 1969. The last time unemployment levels were this low, the first humans landed on the moon. The inflation rate was 5.5% The DJIA was 800. The average cost of a new home was $15K, and the average salary was $9K. A gallon of gas cost a scorching thirty-five cents.
On the regulatory front, Senator Durbin introduces a bill to create a 36% APR Cap on Consumer Loans. The 36% cap matches a similar rate for loans offered to service members and is superseded by strict state-level caps, and offers no preemption of the patchwork of state laws for digital models.
Online marketplace reaches $ 500M in online real estate investments (Real Estate Weekly), Rated: AAA
CrowdStreet, Inc., a technology provider with an online marketplace for direct equity investment in commercial real estate (CRE), announced that in March it crossed the $500 million threshold in total online investments with a record number of new individual investors.
The news accompanies a record quarter with over $75 million invested.
The Pros And Cons Of Leveraged Loans (Seeking Alpha), Rated: AAA
Corporate America has taken on substantially more debt in the aftermath of the Great Recession. Today, the underlying structure of that leverage looks different. Fewer bonds are being issued. Bank loans to indebted companies now match junk bonds in total issue. This article will review the market for leveraged loans – a marketplace that has grown tenfold in the new millennium and has passed the $1 trillion threshold.
In 2017, nearly 70% of levered loans were refinanced at lower interest rates. That creates a lot of turnover.
BlackRock is building a team of 30 data scientists to create a next-generation stock-lending platform (Business Insider), Rated: A
BlackRock founded a Palo Alto, California-based group called AI Labs last year, directed by the Stanford professor Stephen Boyd. Now, according to job postings reviewed by Business Insider, the 30-member team is tackling projects ranging from next-generation lending platforms to automating human tasks.
ONLINE LENDER SETTLES WITH FTC FOR .85 MILLION (Lawyers and Settlements), Rated: A
Avant LLC, the online lending phenomenon which had previously been hailed as a “breakout financial success story,” has agreed to settle a lawsuit brought by the Federal Trade Commission (FTC) for $3.85 million. Although the lawsuit largely relied on a different federal statute, it shares much of the consumer financial protection zeal of the excessive overdraft fee lawsuits recently leveled against credit unions, banks and payday lenders. But it also reveals shortcomings in federal consumer protection laws.
Providing Additional Liquidity to Some Delinquent Borrowers Can Actually be a Win-Win (Yahoo! Finance), Rated: A
Consumers who fall behind on credit payments may find an unexpected lifeline—another loan from their lender. A new TransUnion (TRU) study found that, in some instances, both lenders and consumers can benefit when additional loans are extended to customers during difficult times. The findings were released today during the 2019 TransUnion Financial Services Summit, attended by more than 300 executives from across the globe.
In the study, 31% of delinquent borrowers experienced improvement on one or more of their delinquent debts when securing a new personal loan. In addition, 24% of borrowers also performed well on the new loan.
Monzo plots US launch as soon as this summer (The Telegraph), Rated: A
Monzo, the mobile banking app known for its coral coloured debit cards, is planning to launch in America as soon as this summer, The Daily Telegraph has learnt.
The £1bn start-up challenger bank is in the process of hiring executives to lead its product and marketing arms in the US. It is expected that the company will choose Los Angeles as its base.
Affirm, Kabbage, Tala — The Big Three of Online Loans (Bitnews Today), Rated: AAA
Affirm is a company that provides payday loans online and at points of sale. To receive an approval decision, a potential Affirm client does not have to wait long — the company’s scoring system processes its questionnaire, profiles in social networks and other documents very fast.
Kabbage also provides loans online using an automated system. However, the clients of this company are not ordinary consumers, but owners of SMEs. When the founders of Kabbage decided to launch a new project in 2009, there was a gap between personal loans for consumers and credit lines allocated to small businesses in the lending system.
- the initial idea of the company’s founder Shivani SIROYA to start her own business was that “the existing credit system works very poorly”;
- to assess the creditworthiness, Tala uses its own scoring system, which examines a set of data about the potential borrower, using machine learning technology and big data;
- the intellectual service works in automatic mode: it investigates, makes a decision, issues loans.
Resolve launches as a B2B online financing service (Digital Commerce 360), Rated: A
Financial technology company Affirm is betting that what works for online retailers will also work for B2B merchants who want to offer online financing to customers.
Affirm has launched Resolve as a B2B version of an online financing service that Affirm provides to retailers.
Kabbage Teams with BTEA to Fuel Access to Funding for Women- and Minority-Owned Businesses (Finanzen), Rated: B
Kabbage, Inc., a cash flow technology and automated lending platform for small businesses, has formed a strategic alliance with New York’s largest contractor association, the Building Trades Employers’ Association (BTEA), to provide access to fast and flexible small business funding for BTEA members through the Kabbage platform. The alliance will support women and minority-owned business enterprise (WMBE) contractors who often have difficulty accessing the funding required to procure contracts for New York’s largest construction projects.
The alliance between BTEA and Kabbage provides BTEA’s 1,300 contractor companies, including more than 100 MWBE contractor members, the opportunity to access lines of credit as high as $250,000 and attain greater financial capacity.
In The Face Of Growing Fraud Threats, Finance Firms Should Look At Managed Security (Forbes), Rated: AAA
Financial institutions face a complex array of threats — from the immediate such as synthetic identities which have been used to defraud individual firms multiple times.
In 2018, more than 43,000 breaches across all industries involved the use of customer credentials stolen from botnet-infected clients, the Accenture report said.
Read the full report here.
Fig Loans Becomes First-Ever FinTech to Receive CDFI Certification (Yahoo! Finance), Rated: A
Fig, a mission-driven FinTech company that offers credit building alternatives to predatory loans for low-income borrowers, has become the first-ever FinTech company to become both a Certified B Corporation and federally certified Community Development Institution (CDFI). VilCap Investments and Techstars are early Fig Loans investors.
CFPB plan a mixed bag for debt collectors (American Banker), Rated: A
The Consumer Financial Protection Bureau released a plan Tuesday to restrict how often debt collectors can call borrowers about unpaid credit and to allow consumers to opt out of other types of communications.
The proposal to overhaul the debt collection industry would limit phone-based collection attempts for the same consumer to seven calls per week. Debtors could also opt out of allowing collectors to contact them via voice mail, email and text messages.
Read the full text of the proposed rule here.
Behind The Scoop: An inside look at Genesis’ lending business (The Block Crypto), Rated: A
- $250m worth of outstanding loans gives it an estimated 2/3 share of the total outstanding crypto loan pie
- Genesis has seen its total USD value of borrows increase 35% QoQ in 1Q19, vs. lending protocols which saw a ~20% decline; Genesis total borrow volumes were almost an order of magnitude greater than all of borrows on lending protocols in 1Q19
Ocrolus, inFactor Partner on End-to-End Automation for Merchant Cash Advance Lenders (Ocrolus), Rated: B
Ocrolus today announced a partnership with inFactor, the financing platform that brings clarity and security to small business financing. This partnership combines two powerful technology solutions to drive end-to-end underwriting automation for Merchant Cash Advance (MCA) lenders
Funding Circle still offers manual lending in other markets (P2P Finance News), Rated: AAA
FUNDING Circle is still offering investors the option to self-select their loans in its three overseas markets, its annual report revealed last month.
The peer-to-peer business lender scrapped its manual lending option in the UK in 2017, saying that its auto-invest product ensures better diversification.
Digital Lending Platform Esme Loans Hits £50 Million of Lending to UK Businesses (Crowdfund Insider), Rated: A
Esme Loans, the NatWest backed standalone digital lending platform for SMEs, announced last week it has hit £50 million of lending to UK businesses. The online lender reported that it has seen a continued period of strong growth, following an uplift in lending of 337% between 2017 and 2018.
Just eight months since launching in the UK, Goldman Sachs’ digital savings account has attracted a quarter of a million customers.
Investors are getting more comfortable with the P2P ISA (AltFi), Rated: A
In the 2016/17 tax year just 5,000 customers opened IFISAs with a total £36m subscriptions (these figures were disputed by some platforms as being too low). In the following 2017/18 tax year this shot up 31,000 investors backing the IFISA with £290m subscribed in the tax year and a total of £366m in outstanding balances in IFISAs at 5 April 2018.
What is the best provision fund structure? (P2P Finance News), Rated: A
PROVISION FUNDS are designed to cover peer-to-peer investors in the event that a borrower defaults on their loan, but the way they are funded and operated varies widely across platforms. So what should investors be looking for and is there an optimal structure to reduce their chances of losses?
One key difference is whether pay-outs from reserve or provision funds are automatic or discretionary.
RateSetter is credited with the invention of the provision fund concept, which has been part of its business model since it launched in 2010. It is funded by borrowers’ repayments and money is automatically reimbursed to investors if loans go into arrears.
Tandem Recognized as Best New Digital Bank (Crowdfund Insider), Rated: B
Challenger bank Tandem has been recognized by CFI.co (Capital Finance International) as the “Best Neo Bank UK 2019.”
OakNorth launches mortgages for HNWIs, SMEs, and clients with atypical income streams (Fintech Finance), Rated: B
OakNorth – the bank for entrepreneurs, by entrepreneurs – has today announced it is entering the retail mortgage market with lifetime tracker rate products, aimed at affluent individuals with atypical sources of income.
The six largest banks in the UK dominate 77 percent of the mortgage market, but often find it commercially unviable to create bespoke mortgages for these individuals as they lack the appropriate cost base and expertise to cater to them. These individuals therefore require more bespoke lending solutions, and as a lender that has provided over £3bn in bespoke loans to UK entrepreneurs since its launch, OakNorth has the necessary expertise and tailored credit analysis models to cater to this unique market niche.
Jiayin Group Readies $ 40 Million U.S. IPO (Seeking Alpha), Rated: AAA
According to a 2017 Oliver Wyman report on Chinese FinTech firms, outstanding loan balances for online peer-to-peer lending platforms have exploded in recent years, from RMB 31 billion ($467 million) in January 2014 to RMB 856 billion ($129 billion) by January 2017.
P2P lending in crisis as regulatory bubble pops (Technode), Rated: A
Chinese peer-to-peer (P2P) lender Dianrong, once hailed as the “LendingClub of China,” appears to be in crisis following an announcement that it is closing around two-thirds of its offline branches and laying off as many as 2,000 employees. At around the same time, it was accused of falling behind on wages and severance payment. In mid-April, the company reportedly sought $100 million in investment to meet new capital requirements.
Goldman Delays Marcus’ Germany Launch (PYMNTS), Rated: AAA
International P2P Lending Volumes April 2019 (P2P-Banking), Rated: AAA
The total volume for the reported marketplaces in the table adds up to 571 million Euro.
Milestones achieved this month (total volume since launch):
- Mintos crossed 2 billion EUR
This credit card won’t let you buy anything else after you’ve hit your annual carbon limit (Fast Company), Rated: A
Doconomy is launching two versions of the card later this year. One just tracks your carbon footprint as you spend, and the other, called Do Black, takes the additional step of setting a hard limit on your footprint for the year. Initially, the data used to calculate the impact of each purchase will be imprecise—the system pulls the category code of a merchant that classifies it as a particular kind of store, then makes a calculation based on the general carbon footprint of the industry, whether you’re buying something from a fast-food joint, a clothing store, or an airline. The limit is based on a country-specific calculation of how much carbon each citizen can emit to stay on track with the 2030 goal to cut emissions in half.
Others are working on similar solutions; a startup nonprofit called Poseidon Foundation is beginning to work with retailers to track the impact of specific purchases and let customers instantly buy a carbon offset equal to their emissions. Ben and Jerry’s tested the concept at an ice cream shop in London last year.
Over 50 Banks, Firms Trial Trade Finance App Built With R3’s Corda Blockchain (CoinDesk), Rated: A
ABN Amro, Standard Chartered, ING and around 50 other banks and companies have participated in tests of a trade finance application called Voltron.
The tests saw firms across 27 countries use Voltron, which was developed by R3 using its Corda platform, to make simulated letter of credit transactions.
Real Estate Tokens: What They Are and How to Invest (Bitcoin Market Journal), Rated: A
Put simply, a real estate token is a virtual asset used to represent ownership of land, apartments, homes, and various other real properties. The intent is to eliminate antiquated and outdated methods of dealing with real estate. Instead, buyers and sellers complete transactions with digital tokens.
Currently, it can be a challenge to find the right place to invest in real estate tokens; however, there are a few platforms that can get you started.
The Harbor platform provides users with a way to trade real estate on a blockchain network. Assets available on Harbor include private REITs, real estate funds, building ownership, and land. Using blockchain technology means Harbor provides transparency, efficiency, fractional ownership, and, of course, liquidity.
Additionally, Slice gives users the ability to hold, trade, or liquidate their tokens with its built-in security exchange platforms. The platform is available to anyone who has $10,000 he or she is willing to invest.
Meridio is a platform that gives its users the ability to invest in shares of real estate on the blockchain. Through Meridio, properties are split into digital shares, which gives investors and owners a way to interact with one another seamlessly.
Bitfinex Releases Whitepaper to Confirm $ 1 Billion Initial Exchange Offering (CryptoGlobe), Rated: A
Cryptoasset exchange Bitfinex has confirmed that it is planning to raise $1 billion through an initial exchange offering (IEO).
Dong has also been accepting pre-orders for Bitfinex’s upcoming token sale through his crypto-lending application Renrenbit. The well-known investor had reportedly taken pre-orders from users who wanted to participate in the public phase of Bitfinex’s upcoming $1 billion token sale, even before IFinex published an official whitepaper for it.
Cred Partners with Tron and Bitcoin.com to Provide Crypto Lending and Borrowing Services (Bitcoin Exchange Guide), Rated: A
Bitcoin.com has announced a partnership with Cred in which Bitcoin.com users will earn interests of up to 10% on their crypto holdings. Cred is a crypto borrowing and lending company whereas Bitcoin.com is an information portal that has over 4 million Bitcoin wallets.
YOZO a quick and open answer to business lending maze (Mirage News), Rated: A
YOZO is redefining lending for small business by offering a transparent and seamless experience for their borrowing needs. Firstly, by taking the guessing game out of an increasingly frustrating question, “how much can my business borrow?”. YOZO helps small business gauge their borrowing capacity in under a minute. Secondly, by providing an intuitive online experience to apply and receive funds in 48 hours for approved customers.
Brankas wants to bring Southeast Asia’s banks and e-commerce into the digital era (TechCrunch), Rated: AAA
Fintech continues to be among the biggest topics driving startups and investment in Southeast Asia. The region’s “internet economy” is forecast to grow massively as its 600 million people increasingly come online — already Southeast Asia has more internet users (350 million) than the U.S. has people, but developing a robust payment landscape underpins those heady growth forecasts.
Brankas, an Indonesia-based startup that operates regionally, is one such young company — it operates a platform that gives banks and financial companies the tech to roll out digital products and embrace online services.
Singapore Fintech Firm Heading into Indonesia (Retail News), Rated: A
Following a successful Series B funding round, SME lending platform Validus Capital is launching in Indonesia. SME lending platform Validus Capital has launched in Indonesia, its first Southeast Asian market outside its home country of Singapore, the firm announced in a media release on Thursday.
Brazil fintech Nubank opens Mexico office as it seeks Latam expansion (Reuters), Rated: AAA
Brazilian fintech firm Nubank will open an office in Mexico on Tuesday, an initial step in a potential expansion into other Latin American countries, a company executive said.
Nubank, a six-year-old startup that has raised $400 million from investors such as China’s Tencent Holdings Ltd, Sequoia Capital, Tiger Global Management and Kaszek Ventures, will start Mexican operations with 20 employees, Nubank executive and co-founder Cristina Junqueira said in an interview.
News Comments Today’s main news: Affirm raises $300M. LendingClub charged with privacy violation. Funding Circle issues 187M GBP securitization. Zopa legacy portfolio drags. Fellow Finance facilitates 18.2M euros in March loans. Today’s main analysis: March 2019 debt report from LendingTree (A MUST-READ). Today’s thought-provoking articles: Interview with SoFi CEO Anthony Noto. The slowing U.S. economy. […]
- Today’s main news: Affirm raises $300M. LendingClub charged with privacy violation. Funding Circle issues 187M GBP securitization. Zopa legacy portfolio drags. Fellow Finance facilitates 18.2M euros in March loans.
- Today’s main analysis: March 2019 debt report from LendingTree (A MUST-READ).
- Today’s thought-provoking articles: Interview with SoFi CEO Anthony Noto. The slowing U.S. economy. Women in fintech demolish glass ceiling.
- Affirm raises $300 million. A recent announcement shows Affirm developing a relationship with Walmart.
- Affirm to hire in San Francisco.
- LendingClub charged with privacy violations. Specifically, the charge is a violation of the Gramm-Leach-Bliley Act.
- Anthony Noto of SoFi. Interview with Lend Academy’s Peter Renton. See the transcript of the podcast.
- How the U.S. economy is slowing. From PeerIQ.
- LendingTree’s March 2019 debt report. Detailed. Great charts. A must-read.
- PayPal invests in blockchain startup. Is this dipping the toe in the water? Will we see PayPal taking crypto payments any time soon? Or is this a one-time investment?
- Zillow opens home lending arm.
- Earnin under investigation in New York. Given the sentiments on payday lenders, whether or not you consider Earnin in that category, this was bound to happen.
- BlockFi interest account customers get first payouts.
- Crypto lenders push no-tax perk of Bitcoin loans.
- Atomic Capital makes aggressive offer on crypto loans.
- SME bank Novo snags $4.8 million in funding.
- Blend to deepen bank ties.
- Will millennials allow non-banks a foothold in finances?
- Success Member is an online loan marketplace franchise.
- Marcus product head resigns.
- Tradeweb raises $1.1 billion.
- Direct Lending Investments gets hit with class action.
- Pagaya enters real estate sector.
- White Oak Commercial Finance adds origination talent.
- Charles Schwab to offer digital investment advice by subscription.
- Funding Circle issues 187 million GBP securitization. It’s good to see this.
- Zopa legacy portfolio drags.
- Starling Bank raises 75 million GBP.
- Monzo mulls 11 GBP per month premium offer.
- Monevo review.
- FCA warns against P2P isas. Again.
- WageDay Advance is a smaller type of Wonga.
- Five ways to add IFISA diversity.
- Income properties.
- Finastra adds chief people officer.
- Fellow Finance facilitates 18.2 million euros in March loans.
- Finleap acquires Penta.
- CoinLoan enables fiat loans with crypto assets as collateral.
- China: Regulators to pilot P2P lender registration program later in 2019.
- Canada: OnDeck merges with Evolocity.
- Australia: Neobanks target UK rivals scale.
- India: P2P lending.
- South Africa: TymeBank launches Max, a conversational AI for finance.
- Singapore: LCV Trade Finance fund on track.
- Latin America: Fintech unicorns.
- Australia: Brokers urged to seize SME opportunities.
- United States
- Max Levchin’s Affirm raises $ 300 million (Axios), Rated: AAA
- PayPal co-founder’s fintech company scores $ 300 million, plans massive hiring in S.F. (Biz Journals), Rated: A
- FTC Privacy and Data Security Report for 2018 (JDSupra), Rated: AAA
- Anthony Noto of SoFi (Lend Academy), Rated: AAA
- US Economy Slowing (PeerIQ), Rated: AAA
- LendingTree Debt Report – March 2019 (LendingTree), Rated: AAA
- PayPal Makes Its First-Ever Investment in a Blockchain Startup (CoinDesk), Rated: A
- Zillow is now a mortgage lender, launches Zillow Home Loans (HousingWire), Rated: A
- A payday lender in disguise? New York investigates the Earnin app (American Banker), Rated: A
- Crypto Lending Platform BlockFi’s Interest Account Customers Receive Their First Interest Payments (Bitcoin Exchange Guide), Rated: A
- Crypto lenders push no-tax perk of leveraging bitcoin for cash (American Banker), Rated: A
- Atomic Capital Goes On The Attack With New Crypto Loan Offer In The Market (Bitcoin Exchange Guide), Rated: A
- New $ 4.8m funding for SME bank Novo (Fintech Futures), Rated: A
- Blend seeks to deepen bank ties with account opening product (American Banker), Rated: A
- Will Millennials Bring Non-banks into Their Finances? (deBanked), Rated: A
- Best low cost franchises to get into (BM Magazine), Rated: A
- Goldman Sachs’ Marcus Loses Product Head (PYMNTS), Rated: A
- Tradeweb Raises $ 1.1 Billion in Year’s No. 2 IPO in U.S. (Bloomberg), Rated: A
- Class Action Lawsuit Filed Against Brendan Ross, Direct Lending Investments, and Others (deBanked), Rated: A
- AI-Powered Asset Manager Pagaya GoesAfter Real Estate (Institutional Investor), Rated: A
- White Oak Commercial Finance Adds Origination Talent in Texas (AP News), Rated: B
- Charles Schwab Now Offers Investment Advice Digitally via Subscription (Subscription Insider), Rated: A
- United Kingdom
- Funding Circle back in securitisation market with £187m deal (P2P Finance News), Rated: AAA
- Zopa legacy portfolio drags on P2PGI performance (P2P Finance News), Rated: AAA
- Will more challenger banks evolve as banking as a service providers? (Tearsheet), Rated: A
- Monzo, following Revolut and N26, mulls new £11 per month premium offering (AltFi), Rated: A
- How to join the rush for a last‑minute Isa (The Times), Rated: A
- Monevo Review – An Excellent Place to Begin Your Loan Search (DoughRoller), Rated: A
- FCA warns that P2P Isas are ‘high risk’ (Money Observer), Rated: A
- Payday lending isn’t over yet – and now its victims are being shortchanged yet again (Independent), Rated: A
- Five ways to add IFISA diversity (P2P Finance News), Rated: A
- I trust bricks and mortar and want to invest but what’s the best way to create an income from property? (This is Money), Rated: A
- Finastra welcomes Sharon Doherty as Chief People Officer (Techapeek), Rated: B
- Regulators to pilot P2P lender registration program in back half of 2019 (technode), Rated: AAA
- European Union
- Fellow Finance’s platform facilitated 18,2 million euros of loans in March (GlobeNewswire), Rated: AAA
- Finleap acquires German challenger bank Penta (Fintech Futures), Rated: A
- CoinLoan Enables Borrowers to Obtain Fiat Currency Using Cryptoassets as Collateral (Cardrates), Rated: A
- Women in Fintech Demolish Glass Ceiling (Lend Academy), Rated: AAA
- Onfido scores $ 50 million investment (Finextra), Rated: A
- Australian neobanks target scale of UK rivals without growing pains (AltFi), Rated: AAA
- Brokers urged to seize opportunities in SME space (TheAdviser), Rated: A
- P2P lending (Invest in India), Rated: AAA
- Southeast Asia
- LCV TRADE FINANCE FUND ON TRACK WITH AN ADDITIONAL US$ 14.8MIL TO SUPPORT SMES IN SINGAPORE (Digital News Asia), Rated: A
- OnDeck merges Canadian ops with Evolocity (Finextra), Rated: AAA
- South Africa
- For South Africa’s first challenger bank, conversational AI isn’t just a nice-to-have (Tearsheet), Rated: AAA
- Latin America
- Why Fintech Startups Are Rapidly Becoming Unicorns in Latin America (Next Billion), Rated: AAA
Max Levchin’s Affirm raises $ 300 million (Axios), Rated: AAA
Affirm, the consumer credit startup led by PayPal co-founder Max Levchin, has raised around $300 million in Series F funding at a $2.9 billion post-money valuation, Axios has learned from multiple sources.
PayPal co-founder’s fintech company scores $ 300 million, plans massive hiring in S.F. (Biz Journals), Rated: A
Flush with a monstrous funding round, this San Francisco-based fintech company plans to ramp up its hiring from 580 employees to 850 by the end of the year – and the bulk will be in the Bay Area.
FTC Privacy and Data Security Report for 2018 (JDSupra), Rated: AAA
Anthony Noto of SoFi (Lend Academy), Rated: AAA
The CEO of SoFi talks priorities, innovation, company culture, competition and what it will take to build a world class financial services firm
US Economy Slowing (PeerIQ), Rated: AAA
US 4th quarter GDP growth slowed to 2.2%, as what is shaping up to be the largest expansion in US economic history starts to lose steam. Consumer spending also slowed in January, rising by just 0.1% MoM. The Fed’s preferred inflation gauge, PCE, rose by just 1.4% YoY, justifying the Fed’s decision to keep rates on hold. Overall signs point to a slowing economy in the late stages of an expansion.
LendingTree Debt Report – March 2019 (LendingTree), Rated: AAA
After a brief respite in mid-2018, the debt-to-income ratio for consumer debt rose once more, reaching 25.41% by the end of 2018. That falls just shy of the all-time high of 25.49% set one year earlier.
Household wealth saw a $5 trillion decline last quarter
Losing $5 trillion of wealth may sound disastrous, but that’s what happened to American households last quarter. According to the Federal Reserve, total net worth of U.S. households fell from $108 trillion to $104.3 trillion in the last quarter of 2018. The loss was the biggest quarterly drop since the depths of the great recession of 2008.
PayPal Makes Its First-Ever Investment in a Blockchain Startup (CoinDesk), Rated: A
Announced today, PayPal has joined the extension of a Series A funding round in Cambridge Blockchain, a startup that helps financial institutions and other companies manage sensitive data using shared ledgers.
Neither PayPal nor Cambridge Blockchain disclosed the investment amount, but recent filings with the SEC indicate that Cambridge Blockchain has raised a total of $3.5 million in new equity from several investors over the past nine months. That follows the $7 million close of its Series A in May of 2018, and brings the total capital raised to $10.5 million.
Zillow is now a mortgage lender, launches Zillow Home Loans (HousingWire), Rated: A
Zillow announced Tuesday that it is launching its own mortgage lending operation, which it is calling Zillow Home Loans.
A payday lender in disguise? New York investigates the Earnin app (American Banker), Rated: A
As early wage access programs such as Even, PayActiv, FlexWage, ZayZoon and DailyPay gain traction, some other apps are copying their style while using a more traditional payday-loan model — sparking attention from law enforcement agencies in the process.
That’s what happened to Earnin, which is often referred to and bills itself as an early wage access provider, which give employees access to their paychecks before they are deposited. The New York Department of Financial Services launched an investigation of the firm over concerns it may be skirting state lending laws by, among other things, requiring tips from users in lieu of disclosing fees.
Crypto Lending Platform BlockFi’s Interest Account Customers Receive Their First Interest Payments (Bitcoin Exchange Guide), Rated: A
Since their public launch on March 5, BIA has grown by over 400% and counting. Approximately 75% of BIA clients have a balance of less than 5 BTC or 150 ETH. Their median account balance is $7,000 USD.
Crypto lenders push no-tax perk of leveraging bitcoin for cash (American Banker), Rated: A
Former Wall Street trader Edgar Fernandez used some of his bitcoin as collateral to borrow nearly $100,000, a move that let him keep his cryptocurrency and avert a tax bill on the newly acquired cash.
Genesis Capital, a cryptocurrencies lender in Jersey City, New Jersey, an affiliate of Genesis Trading, says it handed out more than $1.1 billion in cash loans and borrowed virtual cryptocurrencies in 2018. That total volume doubled in the last quarter of 2018 from the volume of the previous two quarters. Other lenders have also said they are doing more transactions, including Nexo, a cryptocurrencies lender that says it has loaned $330 million since launching last April.
Atomic Capital Goes On The Attack With New Crypto Loan Offer In The Market (Bitcoin Exchange Guide), Rated: A
The asset tokenization company, Atomic Capital, is making a very aggressive loan offer in the crypto lending field. Back on Wednesday, the firm will be giving USD loans for 85% of the value of the Bitcoin (BTC) or Ethereum (ETH) used as collateral. In this way, the firm will be offering the most generous loan-to-value (LTV) in the space.
Just to put it into comparison, BlockFi offers a maximum LTV of 50%. Celsius Network, meanwhile, is giving customers 25%, 33% or 50% LTV.
Atomic will be charging interest rates of 11% and 13%. This is much more than the 4.5% or 8.95% that other competitors offer.
New $ 4.8m funding for SME bank Novo (Fintech Futures), Rated: A
Novo has raised $4.8 million in venture seed financing to make banking accessible for small businesses by launching no-fee FDIC-insured digital banking.
Blend seeks to deepen bank ties with account opening product (American Banker), Rated: A
Blend is aiming to expand its customer base of banks and credit unions with a digital account opening product that it says takes some customers as little as two minutes to complete.
The account comes in addition to the mortgage products the digital loan origination fintech already offers and can stand on its own or be integrated as a package, the company said Tuesday.
Will Millennials Bring Non-banks into Their Finances? (deBanked), Rated: A
According to an Accenture surveyfrom five years ago, 34% of millennials said they would bank with Apple if such a product were available.
Best low cost franchises to get into (BM Magazine), Rated: A
Business Services Franchise
Success Member Inc.: It is the leading online loan marketplace that connects consumers with banks, credit partners and multiple lenders both nationally and internationally. They offer training with an expert to this industry of 33 years, along with a lifetime one-on-one dedicated support.
Minimum Cash Required:$25,000
- Training and Support: Yes
- Financing: Yes
- SBA Approved: Yes
- Home-Based: Yes
Goldman Sachs’ Marcus Loses Product Head (PYMNTS), Rated: A
Tradeweb Raises $ 1.1 Billion in Year’s No. 2 IPO in U.S. (Bloomberg), Rated: A
Tradeweb Markets Inc. raised $1.1 billion in the second-largest U.S. initial public offering this year, after again increasing the number of shares it was selling and then pricing them above the marketed range.
Class Action Lawsuit Filed Against Brendan Ross, Direct Lending Investments, and Others (deBanked), Rated: A
A class action lawsuit has been filed in California against Direct Lending Investments, LLC (DLI), Brendan Ross, Bryce Mason, Frank Turner, Rodney Omanoff, and Quarterspot Inc. alleging breach of contract, breaches of fiduciary duty, aiding and abetting breaches of fiduciary duty, and fraudulent inducement.
Read the full complaint here.
AI-Powered Asset Manager Pagaya Goes
After Real Estate (Institutional Investor), Rated: A
Pagaya, which manages money using algorithms created with artificial intelligence, has raised $25 million in a series-C financing round led by Oak HC/FT, a health care and financial technology venture firm.
The fund raise will support the company’s move into real estate, corporate credit, mortgages, and other asset classes.
White Oak Commercial Finance Adds Origination Talent in Texas (AP News), Rated: B
White Oak Commercial Finance (“White Oak”), an affiliate of White Oak Global Advisors, today announced the appointment of Andrew Bae to Director of ABL Originations, concentrating on Texas and the Southwestern U.S. region. Mr. Bae brings nearly 20 years of experience in commercial finance, most recently leading the establishment of the Dallas office for ExWorks Capital, a senior secured debt fund.
Charles Schwab Now Offers Investment Advice Digitally via Subscription (Subscription Insider), Rated: A
Clients pay a one-time fee of $300 and then $90 a quarter.
Funding Circle back in securitisation market with £187m deal (P2P Finance News), Rated: AAA
FUNDING Circle has entered the securitisation market for the third time, with a £187m portfolio of UK loans originated by the peer-to-peer business lender.
Alternative asset manager Pollen Street Capital is the equity sponsor of the deal, having backed Funding Circle’s last securitisation eleven months ago.
While Funding Circle operates in the UK, the US, Germany and the Netherlands, the loans included in the securitisation are just from the UK.
Zopa legacy portfolio drags on P2PGI performance (P2P Finance News), Rated: AAA
P2P GLOBAL Investments (P2PGI) has blamed its poorly-performing legacy Zopa portfolio for its latest net asset value (NAV) dip.
The alternative finance-focused investment trust generated a NAV of just 0.31 per cent in February 2019, down from 0.45 per cent in January, and 0.75 per cent in December. This brings the trust’s annualised NAV to 3.7 per cent.
Will more challenger banks evolve as banking as a service providers? (Tearsheet), Rated: A
According to Starling, it has 20 institutional clients on its BaaS platform, which it launched in August 2018. Payment volume through the service is doubling month over month.
Digital challenger bank Monzo crowned a bumper year in 2018 by coming first for customer service in an independent survey, stealing the title from regular winner First Direct. But will its growing legion of coral card-carriers ever pay for its expanding array of services?
The bank, which is now testing a new paid-for premium offering, thinks they might just do so. ‘Monzo Plus’ – as it is being called – even allows users paying a monthly fee to have Monzo cards in colours other than its famous ‘hot coral’ colour.
How to join the rush for a last‑minute Isa (The Times), Rated: A
There are now just over 48 hours left to make the most of the annual tax breaks on offer in an individual savings account (Isa). This year’s £20,000 allowance expires at midnight on April 5 and you can’t carry it over so it’s a case of use it or lose it.
Monevo Review – An Excellent Place to Begin Your Loan Search (DoughRoller), Rated: A
Through Monevo, you’ll be matched with loans of up to $100,000 with interest rates ranging from 3.99% to 35.99% APR; finding this many competitive options could take you hours to do individually. With Monevo, you can do it in about 60 seconds.
FCA warns that P2P Isas are ‘high risk’ (Money Observer), Rated: A
The Financial Conduct Authority (FCA) has warned that mini-bonds and peer-to-peer loans held within the Isa wrapper are “high risk”.
Payday lending isn’t over yet – and now its victims are being shortchanged yet again (Independent), Rated: A
The administrators of WageDay Advance, which went under in February, have started contacting thousands of former customers owed compensation through being mis-sold loans by the company to urge them to join a growing list of creditors.
Compared with Wonga, WageDay was more of a piranha fish than a shark – but the problems it has created aren’t all that different.
Five ways to add IFISA diversity (P2P Finance News), Rated: A
THIS WEEK is the busiest of the year for ISA providers and ISA savers alike. As the end of the tax year approaches, investors and savers are rushing to make the most of their annual ISA allowance, while ISA managers scramble to convince them that theirs is the right product.
I trust bricks and mortar and want to invest but what’s the best way to create an income from property? (This is Money), Rated: A
People are still making money from property and always will, sometimes lowering their exposure by jointly investing with friends and family, or looking at peer-to-peer lending. Investing locally can give first time investors more confidence as they know their own postcodes, and can keep an eye on what’s going on.
Finastra welcomes Sharon Doherty as Chief People Officer (Techapeek), Rated: B
Finastra today announced the appointment of Sharon Doherty, as Chief People Officer. Doherty joins from Vodafone, where she held the position of Global Organization and People Development Director. In her new role at Finastra she will have global responsibility for making Finastra the most loved and inclusive employer in the Fintech industry.
Regulators to pilot P2P lender registration program in back half of 2019 (technode), Rated: AAA
China is expected to start piloting a registration program for online peer-to-peer (P2P) lending platforms in the second half of this year. Regulators plan to start requiring P2P lenders in pilot cities, located in more developed regions, to register with the monitoring system. Regional and national players will have to meet certain requirements on registered capital, risk reserves, and lender risk compensation in order to be registered in the system. Regulators aim to roll out the national registration system by 2020.
Fellow Finance’s platform facilitated 18,2 million euros of loans in March (GlobeNewswire), Rated: AAA
In March Fellow Finance investors funded business and peer-to-peer loans worth around 18,2 million euros. Cumulative loan volume grew over 415 million euros and the total number of investors grew to 12 031. You can always check the real-time peer-to-peer lending statistics on our website: www.fellowfinance.com/for-investor/statistics.
Finleap acquires German challenger bank Penta (Fintech Futures), Rated: A
CoinLoan Enables Borrowers to Obtain Fiat Currency Using Cryptoassets as Collateral (Cardrates), Rated: A
In a Nutshell: In the wake of the 2008 financial crisis, peer-to-peer (P2P) lending arose as an alternative to credit offered by traditional banks. At the same time, blockchain-based cryptocurrencies like Bitcoin also emerged. Now, CoinLoan is bringing the two together through its P2P lending platform that lets borrowers use cryptoassets as collateral for obtaining fiat (or traditional) currency. Lenders provide capital with a guarantee from CoinLoan that they will be repaid in full. Borrowers gain access to funds without needing to dispose of their cryptoassets or prove their creditworthiness.
Women in Fintech Demolish Glass Ceiling (Lend Academy), Rated: AAA
Valerie Kay, Chief Capital Officer at LendingClub, is responsible for overseeing LendingClub’s Investor Group. She addresses the need for diversity, inclusion, mutual respect and collaboration. She emphasizes the vital importance of diversity to drive better workplaces, happier customers and more profits.
Andrea Gellert, Chief Revenue Officer and Chief Marketing Officer of online small business lender OnDeck, says she sees good progress being made by Fintechs in finding female candidates at all levels including C-Suite and board positions. She points out, “There are more female founders than there used to be. We are moving at a much more accelerated pace than previous industries did in terms of female management.”
Onfido scores $ 50 million investment (Finextra), Rated: A
Onfido, the global identity verification provider, today announced it has raised $50M in funding, bringing the total investment in the company to over $100M.
Australian neobanks target scale of UK rivals without growing pains (AltFi), Rated: AAA
Sydney-based digital bank Volt promises to offer a faster more personalised service than the country’s big four incumbents – National Australia Bank, Commonwealth Bank, Australia and New Zealand Banking Group and Westpac.
Melbourne-based small business bank Judo launched last June lends between A$250,000 to A$5,000,000, and is process of applying for a banking license from the Australian Prudential Regulation Authority.
Brokers urged to seize opportunities in SME space (TheAdviser), Rated: A
According to research from small business lender OnDeck Australia, which involved a survey of 331 business with an annual turnover of less than $5 million, 25 per cent of SMEs plan to seek additional finance over the next 12 months.
P2P lending (Invest in India), Rated: AAA
India currently has about 30 online P2P lending platforms. Some of these are Faircent, i2ifunding, Lendbox etc. In 2018, as many as 11 P2P players received the RBI licence to operate as an NBFC – P2P company. RBI in its master directions has defined NBFC – P2P as a non – banking institution which carries on the business of a peer – to – peer lending platform. The estimated P2P lending to be generated in India over the next 5 years is pegged at around $ 4 bn. Whereas in China, the P2P lending book currently is around $ 100 bn.
LCV TRADE FINANCE FUND ON TRACK WITH AN ADDITIONAL US$ 14.8MIL TO SUPPORT SMES IN SINGAPORE (Digital News Asia), Rated: A
SINGAPORE-based leading SME lending platform Validus Capital (Validus) and Lighthouse Canton, an independent asset management and family office advisory services firm, jointly announce the reopening of the LCV Trade Finance Fund (the Fund) with additional capacity of US$14.8 million (S$20 million; RM60 million).
OnDeck merges Canadian ops with Evolocity (Finextra), Rated: AAA
OnDeck (NYSE: ONDK), the leader in online lending to small business, today announced it has completed the transaction combining its Canadian operations with Evolocity Financial Group (Evolocity), a Montréal-based online small business lender. The combined companies are majority owned by OnDeck.
For South Africa’s first challenger bank, conversational AI isn’t just a nice-to-have (Tearsheet), Rated: AAA
South Africa’s TymeBank has launched Max, an AI-powered conversational assistant designed to help consumers learn about personal finance.
For South Africa’s first challenger bank, conversational AI is an important piece of its product roadmap.
Why Fintech Startups Are Rapidly Becoming Unicorns in Latin America (Next Billion), Rated: AAA
News Comments Today’s main news: Klarna launches open banking platform. SoFi re-engineers home loans. Apple’s new credit card. OakNorth secures guarantee of $133M. Qupital raises $15M to bumrush China. Today’s main analysis: Arbuthnot Banking Group audited final results for 2018. Today’s thought-provoking articles: U.S. yield curve, new fintech products. Cities with most overleveraged mortgage debtors. Household debt. Expanding access to credit […]
- Today’s main news: Klarna launches open banking platform. SoFi re-engineers home loans. Apple’s new credit card. OakNorth secures guarantee of $133M. Qupital raises $15M to bumrush China.
- Today’s main analysis: Arbuthnot Banking Group audited final results for 2018.
- Today’s thought-provoking articles: U.S. yield curve, new fintech products. Cities with most overleveraged mortgage debtors. Household debt. Expanding access to credit in land of new halves. Consumers hunger for loans.
- SoFi re-engineers home loans. Every business model needs adjusting from time to time.
- Apple’s new credit card keeps financial advisors guessing. Interesting read.
- U.S. yield curve, new fintech products. From PeerIQ.
- Cities with most overleveraged mortgage debtors. A MUST-READ.
- Household debt. From DBRS.
- Expanding access to credit in land of new halves. A guest article on Lend Academy from Sasha Orloff, former CEO of LendUp. Very interesting read.
- Amount empower’s TD Fit Loan from TD Bank.
- Freebies that come with student loans.
- CNote launches Wisdom Fund for women.
- 70% of Americans would share more personal data for fairer credit.
- Survey on alternative data sharing.
- 7 top real estate crowdfunding platforms.
- Technology prepares ABS professionals for next economic cycle.
- TrustToken’s stablecoin available on Cred.
- OCC fintech charter update.
- Mortech, Roostify partner for enhanced online mortgage experience.
- Finastra launches Fusion Digital Front Office.
- Huobi U.S. launches OTC crypto trading for institutions. Includes crypto lending.
- Elevate a finalist for LendIt Fintech 2019’s Financial Inclusion Award.
- J.D. Power ranks Regions among top alternative lenders for personal loans.
- Arbuthnot Banking Group audited final results for 2018.
- Tech Nation lists fintech pioneers.
- OakNorth secures guarantee of $133 million from British Business Bank.
- Inside OakNorth’s plan to take lending tech global.
- Western Circle Limited offers personal loans online.
- Five last-minute IFISA ideas.
- Monevo launches artificial intelligence loan comparison service.
- An alternative lending approach to fixed rate bonds.
- Half of Brits run out of cash before payday, seek out rogue lenders.
- P2P lenders will have strong presence at Innovate Finance Global Summit.
- Has alternative lending seens its venture capital peak?
- eToro buys Firmo.
- Battlestar Capital partners with Celsius Network.
- Europe: Klarna launches open banking platform. Not a surprise. We knew it was coming, and this will likely push Klarna even further up the ranks of most important fintechs globally. With aggressive expansion, Klarna can leverage this platform to focus its core competency in the area of instant loans all around the globe.
- China: Qupital moves into China with $15 million fund raise.
- Canada: Shadow banking has grown.
- China: Consumers hungry for loans.
- India: New modes of lending.
- Southeast Asia: Bukalapak partners with three P2P lenders.
- Russia: Bank 131 launches. A digital bank targeting global Russian entrepreneurs.
- Australia: APRA proposes strict credit risk management standards.
- United States
- SoFi Refreshes Home Loans, Making Home Buying Painless and Paperless (PR Newswire), Rated: AAA
- Apple’s new credit card keeps advisors guessing (Financial Planning), Rated: AAA
- US Yield Curve Inverts; New Products from FinTechs (PeerIQ), Rated: AAA
- 2019’s Cities with the Most Overleveraged Mortgage Debtors (WalletHub), Rated: AAA
- Household Debt – Mixed Signals (DBRS), Rated: AAA
- Expanding Access to Credit in the Land of New “Halves” (Lend Academy), Rated: AAA
- Amount Delivers Seamless Digital and Mobile Lending Platform to TD Bank (PR Newswire), Rated: A
- 5 Freebies With Your Student Loans (NerdWallet), Rated: A
- CNote Launches Wisdom Fund to Close Lending Gap for Women (PR Newswire), Rated: A
- Study Finds 70% of Americans Would Share More Personal Data for Fairer Credit Decisions (PR Newswire), Rated: A
- Survey: Alternative Data Sharing (Urjanet), Rated: B
- SigFig launches platform to help retail banks sell financial products (Investment News), Rated: A
- 7 Top Real Estate Crowdfunding Platforms (U.S. News), Rated: A
- Technology to Play Crucial Role in Preparing ABS Professionals for Next Economic Cycle (ABL Advisor), Rated: A
- TrustToken’s Stablecoin Now Available On Cred’s Crypto Earning Platform (BlockTribune), Rated: A
- Fintech in Brief: Update on Legal Challenges to OCC Fintech Charter (JDSupra), Rated: A
- Mortech Partners with Roostify for Enhanced Online Mortgage Experience (Business Wire), Rated: A
- Finastra brings community banking services outside the branch with the launch of Fusion Digital Front Office (Finastra), Rated: A
- Huobi’s US Arm Launches Institutional Group for OTC Crypto Trading (CoinDesk), Rated: A
- Elevate Named as a Finalist for LendIt Fintech 2019’s Financial Inclusion Award (AP News), Rated: B
- J.D. Power ranks Regions among top alternative lenders for personal loans (Biz Journals), Rated: B
- United Kingdom
- ARBUTHNOT BANKING GROUP (“Arbuthnot”, “the Group” or “ABG”) Audited Final Results for the year to 31 December 2018 (Morningstar), Rated: AAA
- Tech Nation Lists 10 Fintech Pioneers In Future Fifty 2019 Cohort (Forbes), Rated: AAA
- OAKNORTH ANNOUNCES BRITISH BUSINESS BANK ENABLE GUARANTEE OF £133M (Business Leader), Rated: AAA
- Inside OakNorth’s plan to take its lending technology global (Tearsheet), Rated: A
- Successful UK Payday Lender Western Circle Limited Begins Offering Personal Loans Online (Finger Lakes Times), Rated: A
- Five last-minute IFISA ideas (P2P Finance News), Rated: A
- FINTECH LAUNCHES AI LOAN COMPARISON SERVICE (Business Cloud), Rated: A
- An Alternative Approach (IFA Magazine), Rated: A
- Half of Brits running out of cash before payday – pushing them to rogue lenders (Mirror), Rated: A
- P2P to have strong presence at Innovate Finance Global Summit (P2P Finance News), Rated: B
- China/Hong Kong
- Hong Kong SME financing platform raises $ 15m for China push (Finextra), Rated: AAA
- Consumers hunger for loans, lenders popping up everywhere (Shine), Rated: AAA
- European Union
- Klarna Launches Open Banking Platform (PR Newswire), Rated: AAA
- Has Alternative Lending Seen Its VC Peak? (PYMNTS), Rated: AAA
- eToro buys blockchain company Firmo (Fintech Futures), Rated: A
- Battlestar Capital Earns 30% Returns For Holding Crypto (ChainBits), Rated: B
- APRA Proposes Stricter Credit Risk Management Standards (Regulation Asia), Rated: AAA
- New modes of lending, fund raising on cards (The Asian), Rated: AAA
- Bukalapak partners three P2P lenders to provide loans for offline businesses (Tech in Asia), Rated: AAA
- Russian fintech launches digital bank 131 (Finextra), Rated: AAA
- Shadow banking has grown, but risks to financial systems are modest (Advisor’s Edge), Rated: AAA
SoFi Refreshes Home Loans, Making Home Buying Painless and Paperless (PR Newswire), Rated: AAA
Today, SoFi announced the refresh of its mortgage offering as SoFi Home Loans, complete with a reengineered process that helps people buy or refinance a home with an online application, no hidden fees, or prepayment penalties.
SoFi Home Loans offer competitive rates including affordable down payments, with as little as 10% down on loans up to $3MM, with no hidden fees or prepayment penalties. SoFi allows applicants to choose between four different loan terms and fixed or adjustable rates. Those interested in refinancing can choose between traditional mortgage refinancing, cash-out refinancing, and student loan cash-out refinancing. If SoFi Home Loans isn’t able to handle a loan request, SoFi provides an easy option to digitally transfer member information to its affiliate partner who may be able to help.
Apple’s new credit card keeps advisors guessing (Financial Planning), Rated: AAA
The Apple credit card is the latest offering by a Silicon Valley tech giant looking for a ready-made avenue into the financial services’ sector. While the new card mostly benefits loyal users of Apple products, it’s also an unwelcome reminder of an ever present question on the minds of wealth managers: Will the FAANG companies like Facebook, Amazon, Apple, Netflix and Alphabet continue their land grab of services historically provided by the financial services industry — and at what cost to traditional RIAs?
Ominously, a majority of investors considering switching financial services providers said they would consider banking with a tech company like Facebook, Google or Amazon if they could, according to a recent survey by Novantis.
US Yield Curve Inverts; New Products from FinTechs (PeerIQ), Rated: AAA
For the first time in 3,000 days, and with much anticipation, the 3-month and 10-year treasury curve inverted. The median time to a recession after this curve inverts is between 1 to 1.5 years. However, unprecedented interventions such as QE (and higher central bank holdings globally) make it difficult to draw hard and fast conclusions. Market participants are pricing in a 41% probability of an interest rate cut in the September meeting.
New Products from FinTechs
FinTech innovation continues with new products from PeerStreet and Figure. PeerStreet has launched a 30-year loan to enable private investors to buy rental properties. Residential for Rent loans are targeted towards rental home operators. The rental market in the US has grown exponentially post-crisis people struggle to buy homes. The number of rental homes has grown from 36 Mn in 2006 to 43 Mn in 2017.
2019’s Cities with the Most Overleveraged Mortgage Debtors (WalletHub), Rated: AAA
Buying a home represents an important milestone for most consumers. But for those who dive in to the deep end of real estate without a financial safety net, the decision could lead to buyer’s remorse in the long run. Mortgage rates are slowly falling after reaching their latest peak in November 2018, and are close to the lowest they’ve been in the past 3 decades. This makes 2019 a tempting time to buy a home. Some industry experts believe 2019 is friendlier toward buyers than sellers because of the lower rates.
Household Debt – Mixed Signals (DBRS), Rated: AAA
The most recent Quarterly Report on Household Debt and Credit issued by the Federal Reserve Bank of New York (the Fed) and Equifax Inc. (Equifax) showed that household debt rose for the 18th consecutive period during Q4 2018 to $13.5 trillion, $869 billion higher than the peak reached in 2008. This represented the third-smallest increase (0.24%) over the 18 consecutive periods of growth, partly because of decreasing mortgage loan debt during Q4 2018 to $9.2 trillion from $9.4 trillion at the end of Q3 2018 and flat levels of auto loan debt at $1.3 trillion for both Q3 and Q4 2018.
Expanding Access to Credit in the Land of New “Halves” (Lend Academy), Rated: AAA
Credit is one of the largest, most powerful, lucrative and important industries in the world. It also is one of the best tools for wealth creation – home ownership, small business ownership and growth, and, leveraged investing. This is readily accessible for prime consumers with more options now than ever before. But for the other half of the country that is non-prime, options are still limited and in many cases non-existent.
Early pioneers of securitizations like SoFi, the scaling of marketplace lending like Lending Club, Prosper and Best Egg, and new distribution models like Greensky and Affirm have contributed towards increasing comfort of these “new asset classes” that were mostly locked up in bank’s balance sheets.
There are a lot of new “halves” in today’s world.
- Half of our country have a subprime credit score.
- Half of our country live paycheck to paycheck.
- Half of our country have volatile incomes.
- Millennials and the next generation are approaching half of the workforce, with very different attitudes about loyalty, institutions, and how they spend their money and repay their debts.
Amount Delivers Seamless Digital and Mobile Lending Platform to TD Bank (PR Newswire), Rated: A
Amount, a technology provider for financial institutions, today announced a strategic partnership with TD Bank. TD Bank, a top ten U.S. bank, is leveraging Amount’s platform to power the bank’s TD Fit Loan, which launched in August 2018. This initial offering allows consumers to consolidate higher-interest debt, while helping TD meet growing consumer demand for a seamless digital and mobile lending experience. Through this partnership, TD and Amount will roll out additional offerings, as well as standalone tools addressing fraud, verifications and decisioning.
5 Freebies With Your Student Loans (NerdWallet), Rated: A
1. Career coaching
Who offers it: SoFi.
SoFi members have received over 15,000 coaching sessions to date.
4. Referral bonuses
Who offers it: Multiple refinance lenders.
- Education Loan Finance offers $400 for each successful referral, as well as $100 for the loan applicant.
- Laurel Road lets you split its $400 bonus however you and your referral see fit.
- Splash Financial provides $250 apiece for both parties.
5. Charitable work
Who offers it: CommonBond.
If you prefer freebies that help others, CommonBond has a one-for-one social impact mission. For each loan the lender issues, it donates an amount based on a formula that funds a child’s education in a developing country through the nonprofit Pencils of Promise. Those donations have totaled over $1 million to date.
CNote Launches Wisdom Fund to Close Lending Gap for Women (PR Newswire), Rated: A
Women are the fastest-growing group of entrepreneurs in the U.S. Yet less than 5 percent of small business lending—only $1 in $23—goes to women. CNote aims to fix this disparity with the Wisdom Fund, a new impact investment opportunity launching today.
Investors in the Wisdom Fund will earn an estimated 4 percent annual return, over a 60-month term, on a loan portfolio that’s diversified across established CDFIs. Email email@example.com to learn how you can help fund more women-owned businesses today.
Women seeking loans should contact a participating CDFI. Partners in the Wisdom Fund’s first phase include:
- Carolina Small Business Development Fund, which provides small business loans and financial training to startups, existing businesses and community organizations in North Carolina.
- LiftFund, a Texas-based organization that empowers underserved entrepreneurs with capital and support services in 13 states.
- TruFund, a national nonprofit organization that provides affordable capital to small businesses and nonprofits in Alabama, Louisiana and New York.
Study Finds 70% of Americans Would Share More Personal Data for Fairer Credit Decisions (PR Newswire), Rated: A
More than half (54%) of loan applicants don’t even have a clear understanding of why they receive the interest rate they do from a lender, while a majority (70%) say it is difficult finding lenders who will look at them as something other than their credit score.
- 7 in 10 American adults (71%) wish there was another way to prove themselves to credit lenders outside of the standard credit score.
- Hispanics (82%) and African Americans (81%) are more likely than Whites (67%) to want lenders to look at additional factors in lending decisions.
- 77% believe more data is better when evaluating potential borrowers’ credit.
- 71% would be willing to share more personal data with a lender if it resulted in a fairer credit decision. The motivation is even higher among middle-class earners. 79% of people making $50,000 to $75,000 would share more personal data to prove their creditworthiness, compared to 66% of people making over $100,000.
- 84% think their bank should use modern technology to assess their creditworthiness.
- Specifically, about half of loan applicants (53%) would like their ideal lender to use machine learning to make fairer credit decisions.
- More than 2 in 5 (42%) would like their ideal lender to use machine learning to make the credit for homeownership more accessible to everyone.
- Surprisingly, older generations want newer technology even more. Baby boomers and seniors (83% and 87%, respectively) wanted their banks to use new technologies to score them, compared to 79% for Millennials and Gen Zers.
Survey: Alternative Data Sharing (Urjanet), Rated: B
Urjanet surveyed more than 300 U.S.-based adults to assess consumer sentiment around alternative data sharing in the lending process. Key findings include:
- A majority of consumers have multiple alternative sources of payment history
- Alternative data sharing represents a huge opportunity for lenders to drive financial inclusion
- Most consumers (59%) are willing to share utility and telecom data to boost chances of approval
SigFig launches platform to help retail banks sell financial products (Investment News), Rated: A
SigFig Atlas is billed as a “financial advice and software-guided sales platform” for banks. Accessible either in a branch office or online, SigFig Atlas will assess a customer’s financial needs, then use algorithms to determine which of a bank’s products or services would work best. Beyond robo-advice, Atlas can also recommend checking and savings accounts, loans, mortgages or any other bank products. “ArborCrowd is the first crowdfunding platform launched by a real estate institution, offering a vastly different model than others in the space,” says Adam Kaufman, co-founder and managing director at ArborCrowd.
7 Top Real Estate Crowdfunding Platforms (U.S. News), Rated: A
“ArborCrowd is the first crowdfunding platform launched by a real estate institution, offering a vastly different model than others in the space,” says Adam Kaufman, co-founder and managing director at ArborCrowd.
“We are a marketplace where sponsors can list their offerings and investors can invest typically between $25,000 and $1 million per investment to own their pro-rata portion of that deal or fund,” says Brandon Banks, vice president of real estate at RealCrowd.
Bradley Fulkerson, senior managing director at Transwestern in Atlanta says through Groundfloor, investors provide short-term, high-yield loans, secured by the underlying real estate.
Accredited investors can participate in both equity and debt real estate funding through Portland-based CrowdStreet.
“PeerStreet’s accredited investors earn a stable, consistent return with a yield that’s generally higher than bonds and sometimes even more than equities,” says Brett Crosby, co-founder and chief operating officer at California-based PeerStreet.
Small Change is crowdfunding investing for socially conscious small investors. From the platform, investors choose their projects and invest.
Highly selective RealtyMogul offers commercial real estate investing for accredited and nonaccredited investors.
Technology to Play Crucial Role in Preparing ABS Professionals for Next Economic Cycle (ABL Advisor), Rated: A
An overwhelming majority (90 percent) of asset-backed securities (ABS) professionals feel that adopting new technologies will be important to preparing their businesses for the next economic cycle, according to Capital One’s sixth annual survey at SFIG Vegas 2019.
The survey also revealed that ABS professionals believe the biggest risks to their businesses are uncertainty around regulatory risk and increased credit risk, both at 29 percent. However, despite regulatory risk being a top concern, the industry’s apprehension has nearly cut in half over the last two years. In 2018, 48 percent noted regulations were the biggest risk to their businesses while 58 percent thought so in 2017. Additional top-of-mind concerns for 2019 include increases in interest rates (18 percent) and increased competition (17 percent).
TrustToken’s Stablecoin Now Available On Cred’s Crypto Earning Platform (BlockTribune), Rated: A
Founded by former PayPal financial technology veterans, Cred is a decentralized global lending and borrowing platform that allows stablecoin issuers, exchanges and wallets to provide valuable earn and lending services worldwide.
Fintech in Brief: Update on Legal Challenges to OCC Fintech Charter (JDSupra), Rated: A
On March 19, 2019, the New York State Department of Financial Services (“NYDFS”) filed a brief in opposition to the Office of the Comptroller of the Currency’s (“OCC”) motion to dismiss the NYDFS’ lawsuit challenging the OCC’s statutory authority to grant special purpose national bank charters to Fintechs (the “Fintech Charter”). The brief in opposition signals that the NYDFS will continue its opposition to the Fintech Charter under the leadership of Acting Superintendent Linda Lacewell, who replaced outgoing Superintendent Mari Vullo in February. In opposing the OCC’s motion to dismiss, the NYDFS argued that it has standing to challenge the Fintech Charter, the matter is ripe for judicial review, and its claims are not time-barred. The NYDFS also argued that the OCC’s interpretation of the “business of banking” is not entitled to Chevron deference and “should be invalidated in its entirety.”
Mortech Partners with Roostify for Enhanced Online Mortgage Experience (Business Wire), Rated: A
Today, Mortech, a Zillow Group business providing mortgage technology solutions for mortgage lenders and secondary market teams, announced a new partnership between Mortech’s product and pricing engine (PPE) and Roostify, a digital lending platform that gives customers more control of their home buying process while allowing loan officers to utilize the latest technology to more easily process loans. The strategic partnership will integrate two proven mortgage technology solutions to improve the digital mortgage experience for many industry-leading lenders.
Finastra brings community banking services outside the branch with the launch of Fusion Digital Front Office (Finastra), Rated: A
Finastra has launched Fusion Digital Front Office, an innovative tablet-based banking platform that enables community banks and credit unions to take services directly to the consumer, outside of the branch. The solution provides a simple gateway to manage account origination, sales and service, and transaction processing from any remote location.
Huobi’s US Arm Launches Institutional Group for OTC Crypto Trading (CoinDesk), Rated: A
“We’re entering the market now with a real institutional offering, we’re definitely going to be offering some new products and services,” such as token lending and over-the-counter (OTC) trading, in the coming months, he added.
Elevate Named as a Finalist for LendIt Fintech 2019’s Financial Inclusion Award (AP News), Rated: B
Elevate Credit, Inc. (“Elevate”), a leading tech-enabled provider of innovative and responsible online credit solutions for non-prime consumers, has been named as one of six finalists in the “Excellence in Financial Inclusion” category for the LendIt Fintech Industry Awards 2019. This award is given to the company that has made the biggest impact in expanding access to financial services in new and innovative ways.
J.D. Power ranks Regions among top alternative lenders for personal loans (Biz Journals), Rated: B
Birmingham’s largest bank has ranked among the top alternative lenders in the U.S. for providing personal loan satisfaction through digital applications.
ARBUTHNOT BANKING GROUP (“Arbuthnot”, “the Group” or “ABG”) Audited Final Results for the year to 31 December 2018 (Morningstar), Rated: AAA
· Profit Before Tax £6.8m (2017: £2.5m)
· Underlying profit before tax £7.4m (2017: £3.2m)
· Operating income increased by 24% to £67.9m (2017: £54.6m)
· Negative earnings per share 134.5p (2017: positive 43.9p)*
· Continuing earnings per share 38.0p (2017: 14.0p)
· Underlying earnings per share 40.3p (2017: 17.6p)
· Final dividend per share 20p (2017: 19p), an increase of 5%
· Total full year dividend per share 35p (2017: 33p)
· Bonus share issue to create new class of non-voting shares
· Net assets £196m (2017: £236m)
· Net assets per share 1283p (2017: 1547p)
· Underlying return on deployed equity 5.6% (2017: 4.2%)
Consolidated statement of financial position
At 31 December
Cash and balances at central banks
Loans and advances to banks
Debt securities at amortised cost / held-to-maturity
Assets classified as held for sale
Derivative financial instruments
Loans and advances to customers
Deferred tax asset
Interests in associates
Property, plant and equipment
EQUITY AND LIABILITIES
Equity attributable to owners of the parent
Deposits from banks
Derivative financial instruments
Deposits from customers
Current tax liability
Debt securities in issue
Total equity and liabilities
Read the full report here.
Tech Nation Lists 10 Fintech Pioneers In Future Fifty 2019 Cohort (Forbes), Rated: AAA
Revolut, Monzo, Starling Bank, Currencycloud, Aire, Blockchain, MarketInvoice, Quantexa, Nested and Salary Finance were revealed to be among the 24 most dynamic and fast-growing late-stage technology companies to be chosen to join Future Fifty’s 2019 cohort.
OAKNORTH ANNOUNCES BRITISH BUSINESS BANK ENABLE GUARANTEE OF £133M (Business Leader), Rated: AAA
OakNorth has today announced its participation in the ENABLE Guarantee programme, securing a guarantee of £133m from the British Business Bank, the UK government’s economic development bank. OakNorth will use the guarantee to strengthen further its lending support to fast-growth businesses and established property developers and investors.
The ENABLE Guarantee programme is designed to encourage banks to increase their lending to smaller businesses by reducing the amount of capital required to be held against such lending. Under an ENABLE Guarantee, the UK Government takes on a portion of the lender’s risk on a portfolio of loans to smaller businesses, in return for a fee.
Inside OakNorth’s plan to take its lending technology global (Tearsheet), Rated: A
As a challenger bank, OakNorth charts a different course. While Revolut, Monzo, and N26 focus on putting their digital current accounts in the hands of millions, OakNorth doesn’t even offer a current account. While other challengers are racing to acquire banking licenses all over the world, OakNorth is happy with just a UK license.
OakNorth provides debt financing to entrepreneurs in growing businesses, lending £0.5M to £40M to profitable, scale-up, British businesses. To fund its underwriting, OakNorth offers digital savings accounts. It currently has 40,000 customers with digital savings accounts and has lend £3 billion in under four years.
Successful UK Payday Lender Western Circle Limited Begins Offering Personal Loans Online (Finger Lakes Times), Rated: A
Western Circle Limited has made a name for itself by offering responsible payday loans online. Their decision to branch out into the personal loans market through the new brand PersonalLoansNow.co.uk was well received by their customers.
Five last-minute IFISA ideas (P2P Finance News), Rated: A
THE END of the tax year is fast approaching, so if you haven’t yet taken full advantage of your £20,000 ISA allowance to make tax-free returns, now is the time. The peer-to-peer lending industry is expecting to see an uptick in inflows into Innovative Finance ISAs (IFISA) this year now that there is a much wider choice of products available and the potential for higher returns than cash with lower volatility than the stock market.
FINTECH LAUNCHES AI LOAN COMPARISON SERVICE (Business Cloud), Rated: A
Loan marketplace Monevo has launched a new platform to give consumers comparisons of pre-approved loans.
Based in Macclesfield, the business is a licensed credit broker for personal and business loans and is Europe’s largest personal loan marketplace.
An Alternative Approach (IFA Magazine), Rated: A
When it comes to asset allocation, advisers constantly face the challenge of finding real diversification in client portfolios. Sue Whitbread met with Matthew Ardron and Benedict Yung of Basset & Gold Group, to talk about their approach of offering fixed rate bonds that invest in alternative lending.
Exclusive research for Mirror Money shows by the end of this month, those turning to payday loans will have shelled out more than £214million – that works out at £28 per second
P2P to have strong presence at Innovate Finance Global Summit (P2P Finance News), Rated: B
FOUNDERS of the ‘big three’ peer-to-peer lenders are among the confirmed speakers at Innovate Finance Global Summit (IFGS), which takes place next month at London’s Guildhall.
Giles Andrews of Zopa, Samir Desai of Funding Circle and Rhydian Lewis of RateSetter are all participating in various sessions at the fintech industry trade body’s flagship conference on 29-30 April 2019, which marks the start of UK Fintech Week.
Other confirmed speakers from the P2P world include Zopa chief executive Jaidev Janardana, ArchOver’s Angus Dent, Ali Celiker from British Pearl and Roxana Mohammadian-Molina from Blend Network.
Hong Kong SME financing platform raises $ 15m for China push (Finextra), Rated: AAA
Hong Kong-based online SME trade financing platform Qupital is targeting the mainland after closing a $15 million Series A funding round led by CreditEase FinTech Investment Fund.
Consumers hunger for loans, lenders popping up everywhere (Shine), Rated: AAA
Qin Shuifeng, 30, who lives in the suburban district of Jiading, went to a branch of the Postal Savings Bank of China in 2016 to seek a loan for home improvements.
The lender granted her and her husband a credit line of 1 million yuan (US$148,600), of which they drew 600,000 yuan, with an interest rate 10 percent higher than the benchmark rate.
The central government has issued a series of policies favorable to consumer lending since the second half of 2018.
Still, risks remain. To realize sustainable development, players need to build strong operational and risk control capabilities, either by themselves or in partnership with financial technologies firms.
Klarna Launches Open Banking Platform (PR Newswire), Rated: AAA
Today, Klarna, one of Europe’s leading payment providers and the global market leader in payment initiation services, announces the launch of its own Open Banking Platform. This platform will enable access to more than 4,300 European banks through a single Access to Account (XS2A) API in line with Payment Services Directive (PSD2). Klarna’s XS2A API is the most established and proven solution that has been developed at scale across markets for almost 15 years through the Klarna Group company Sofort.
This platform provides a fully proven and mature infrastructure, superior market coverage and connectivity, with access to 99% of online banking consumers currently across 14 European markets. By opening up its own advanced technology and capabilities, Klarna is simplifying and democratising access to APIs securely. Both established and newer banks and fintechs as well as other licensed businesses, will be able to build smart and personalised offerings that meet the evolving needs of consumers across Europe. Klarna has been one of the leading proponents of the PSD2 legislation and believes high-quality APIs will drive innovation and competition but most importantly will empower consumers across Europe with increased choice, control and clarity on their finances, and ability to access better products.
Has Alternative Lending Seen Its VC Peak? (PYMNTS), Rated: AAA
U.S. FinTech funding reached its highest level in five years in 2018, according to CB Insights data published last month, hitting $11.89 billion. Yet at a time when analysts say VCs are focusing more on late-stage investment, alternative lenders are having a tougher time securing funding, particularly market newcomers in a crowded market.
But there is evidence that investors’ appetite for alternative lending startups is on the wane, even as overall FinTech funding continues to climb — and as the success of the alternative lending market grows, too.
eToro buys blockchain company Firmo (Fintech Futures), Rated: A
Just weeks after launching in the US, trading and investment platform eToro announced plans to purchase Copenhagen-based blockchain firm Firmo, reports Julie Muhn at Finovate.
Founded in 2017, Firmo offers a programming language called FirmoLang that runs on a sidechain. Exchanges can leverage FirmoLang to create financial instruments such as P2P lending platforms or cryptocurrency derivatives with tokens. And Firmo is versatile, allowing the tokens to be run on any blockchain.
Battlestar Capital Earns 30% Returns For Holding Crypto (ChainBits), Rated: B
Battlestar Capital, which is a blockchain staking-as-a-service company, revealed that customers could potentially earn up to 30 percent on a yearly basis when it comes to their idle crypto holdings. Here is everything about the startup’s claims in a nutshell.
In an interview, the company said that it has teamed up with crypto lending startup called Celsius Network in an attempt to launch a large-scale service capable of offering potentially high returns.
APRA Proposes Stricter Credit Risk Management Standards (Regulation Asia), Rated: AAA
The revised prudential standard enhances board oversight of credit risk and requires more intensive credit checks on borrowers. APRA also highlights the risks of P2P originated loans.
New modes of lending, fund raising on cards (The Asian), Rated: AAA
In a bid to change the market dynamics of the banking and financial sectors, the Reserve Bank of India (RBI) will soon come up with alternative models of lending and capital raising for the sectors.
Bukalapak partners three P2P lenders to provide loans for offline businesses (Tech in Asia), Rated: AAA
Bukalapak is teaming up with Indonesian P2P lending startups Amartha, Modalku, and PohonDana to provide loan facilities in a program called Modal Mitra. The loans are available to offline vendors who are part of the company’s Mitra Bukalapak program.
The financing offered through Modal Mitra ranges between US$70 and US$700 and can be paid back in up to six months, with weekly installments starting from US$6. It can only be used for purchases in the Mitra Bukalapak app.
Russian fintech launches digital bank 131 (Finextra), Rated: AAA
Bank 131, a new digital bank focused on Russian companies and entrepreneurs that work for global internet companies and/or buy from global ecommerce companies with a Russia presence, announced today they have received their banking license from authorities – the first and only new bank to do so in four years.
Shadow banking has grown, but risks to financial systems are modest (Advisor’s Edge), Rated: AAA
Canada’s shadow banking sector has grown substantially in recent years, but the overall financial system has grown even faster, keeping risks in check, suggests a new report from the Bank of Canada.
In the report, the central bank details the results of its monitoring of so-called “non-bank financial intermediation” (NBFI), also known as shadow banking. Among other things, the report finds the Canadian NBFI sector has grown by 1.7 times since 2006, driven by strong growth in investment funds, securities financing transactions and private lending.
News Comments Today’s main news: SoFi to roll out crypto trading with Coinbase. Walmart now offers Affirm loans. Funding Circle fund ups the ante on buyback strategy. Orca launches IFISA. LendDenClub cross 1 million borrowers, lenders milestone. Today’s main analysis: 2019 securitization update. How marketplace lending is a growing and dynamic global market. (A MUST-READ) Today’s thought-provoking articles: The 2009 […]
- Today’s main news: SoFi to roll out crypto trading with Coinbase. Walmart now offers Affirm loans. Funding Circle fund ups the ante on buyback strategy. Orca launches IFISA. LendDenClub cross 1 million borrowers, lenders milestone.
- Today’s main analysis: 2019 securitization update. How marketplace lending is a growing and dynamic global market. (A MUST-READ)
- Today’s thought-provoking articles: The 2009 housing market compared to today. Personal loan interest rates for February 2019. Why Midwest BankCentre created a separate digital-only bank. Some bankers are worse off than in 2009. Dragon Victory International analysis.
- SoFi to offer crypto trading through Coinbase partnership. This is the most interesting news story of the week. The largest cryptocurrency exchange partnering with one of the largest marketplace lenders to offer cryptocurrency trading will be a huge feather in the cap for both companies.
- Walmart now offers Affirm loans. We saw this one coming. In fact, I wonder why it took so long. Affirm snagging Walmart as a customer will catapult it to PayPal status fast.
- More on Affirm’s, Walmart’s partnership.
- Affirm CEO breaks it down.
- 2019 securitization update, Square charter status. Square is finally seeing some opposition to its banking aspirations. Excellent analysis from PeerIQ.
- The housing market of 2009 compared to today. A LendingTree analysis showing the markets where median home values have increased the most and the least. California is hot. The Mid-Atlantic and Eastern states are not.
- Personal loan interest rates for February 2019. A great breakdown from Nerdwallet.
- Why a small bank launched a separate digital-only branch. I think we’re going to see more of this. As more consumers demand digital banking, and Millennials are all over it, more brick-and-mortar banks will see the opportunity to launch digital-only branches as separate entities. It’s actually a smart move.
- SoFi to offer zero-fee ETFs.
- FTC orders SoFi to stop misleading consumers.
- Figure raises $65 million.
- Gen Xers have the largest auto loan burden.
- Elevate Credit posts earnings results.
- Elevate’s CIO wins award.
- Hunt Real Estate Capital buys RealtyMogul’s loan underwriting program.
- Kabbage says it’s prepared for the coming recession.
- Kabbage named one of the top workplaces among midsize companies in Atlanta.
- CrowdStreet has new self-directed IRA offering.
- Liquid P2P, Interest Radar partner.
- Direct Lending Investments suspends investor withdrawals.
- HSBC partners with Neptune Financial.
- Venmo debuts rainbow-colored card.
- Mastercard says digital identities will be very important in a few years.
- Credit Karma wants to be known for more than free credit scores.
- Brex launches credit card for e-commerce.
- YieldStreet raises $62 million.
- Guaranteed Rate listed as top loan originator.
- Americans focus on debt management more than retirement savings.
- Banking regulator challenging New York on fintech charters.
- Blockchain can be used for P2P lending.
- LoanStreet makes new hires.
- White Oak Business Capital hires new head of markets.
- Funding Circle fund adds firepower for buyback strategy.
- Orca Innovative Finance ISA launches.
- Experian backs off ClearScore merger.
- NatWest launches account aggregation.
- Open Banking could boom in 2019.
- Wonga reaches from beyond the grave.
- What you need to know about crowdfunding developments.
- Aave launches bill pay platform for crypto.
- Some bankers are worse off than in 2009. A look at global IPOs.
- Report on how marketplace lending is still a growing and dynamic market. A must-read from DBRS.
- Enova expands worldwide credit access.
- Blossom Capital gets $85 million from Robinhood, Funding Circle investors.
- How lending can earn your Bitcoin online. I’d like to see a service where small lenders can lend fiat and earn Bitcoin.
- India: LenDenClub crosses 1 million borrower, lender milestone. Congratulations! Excellent achievement.
- Mexico: PayPal to expand small business loans into country with new partnership. PayPal has begun its slow expansion internationally. Could it someday be a global powerhouse?
- China: Analysis of Dragon Victory International. A very interesting look from Seeking Alpha.
- Latin America: ID Finance Latam revenues climb 403%.
- India: Why startups, investors see big potential in lending.
- Ireland: Grid Finance suspends investments below 100,000 euro.
- Brazil: N26 expands into Brazil.
- China: Is the Chinese P2P lending boom over?
- Singapore: Fintech investments rose to $365 million USD in 2018.
- India: UDS ban will benefit P2P lending.
- Australia: How should accountants talk about fintechs?
- Singapore: Validus Capital raises $15 million for SME financing.
- China: BHB raises $20 million using fake bios of founding team.
- Africa: Fintechs inspire with mobile technology.
- China: Futu Securities downsizes U.S. IPO.
- United States
- Fintech Startup SoFi to Roll Out Crypto Trading Via Partnership With Coinbase (CoinTelegraph), Rated: AAA
- Millennial online lender SoFi to offer zero-fee ETFs, an unexpected rival for index fund giants Vanguard, iShares (CNBC), Rated: A
- FTC orders SoFi to stop misleading consumers (MPA Mag), Rated: B
- Digital lender founded by ex-SoFi CEO raises $ 65M to fuel expansion (American Banker), Rated: A
- Walmart teams with Affirm to offer point-of-sale loans (American Banker), Rated: AAA
- Affirm’s latest partnership brings its alternative financing to Walmart’s US stores and website (TechCrunch), Rated: A
- Loan app Affirm CEO breaks down new Walmart partnership (CNBC), Rated: A
- ABS Vegas – 2019 Securitization Update; Square Charter Status (PeerIQ), Rated: AAA
- The Housing Market’s 10 Year Challenge — Comparing The Housing Market of 2009 to Today (LendingTree), Rated: AAA
- Gen Xers Carry the Biggest Auto Loan Burden; Study Finds (One World Herald), Rated: A
- Personal Loan Interest Rates for February 2019 (Nerdwallet), Rated: AAA
- Elevate Credit (ELVT) Posts Earnings Results, Meets Expectations (Fairfield Current), Rated: A
- Hunt Real Estate Capital buys RealtyMogul’s proprietary loan underwriting program (Housing Wire), Rated: A
- Elevate’s Joan Kuehl Named Dallas ORBIE CIO of the Year (The Progress), Rated: B
- A Recession Coming? Small Business Lending Platform Kabbage Says It’s Prepared (Forbes), Rated: A
- Here’s more on the AJC Top Workplaces midsize companies (AJC.com), Rated: B
- Diversifying a Self-Directed IRA Made Simple with New Offering from CrowdStreet (The Progress), Rated: A
- Liquid P2P and Interest Radar Announce Strategic Partnership (Liquid P2P), Rated: A
- Direct Lending Investments Suspends Investor Withdrawals (Lend Academy), Rated: A
- Fintech deal will provide access to midsize businesses in U.S. (American Banker), Rated: A
- Venmo debuted a limited-edition rainbow-colored card (Business Insider), Rated: A
- Why digital identities will be so important in the next few years, according to Mastercard’s vice chairman (CNBC), Rated: A
- Credit Karma’s Dana Marineau: ‘We want users to think of us as more than just free credit scores’ (Tearsheet), Rated: A
- Why this small bank created a separate, digital-first brand (American Banker), Rated: AAA
- The Future Is Plastic: Fintech Unicorn Brex Launches New Credit Card For E-Commerce Merchants (Forbes), Rated: A
- YieldStreet raises $ 62M to democratise alternative investments in shipping, real estate and more (TechCrunch), Rated: A
- Guaranteed Rate Leads Mortgage Executive Magazine’s List of Top Loan Originators in America (GlobeNewswire), Rated: A
- Americans Focus On Debt Management But Lose Focus On Retirement Savings (Forbes), Rated: A
- U.S. banking regulator fights NY lawsuit over fintech charters (Reuters), Rated: A
- Blockchain and data protection: the main concerns (JDSupra), Rated: A
- LoanStreet positions for growth with new hires (LoanStreet Email), Rated: B
- White Oak Business Capital Hires Carol Bader Apicella to Expand Northeast and Mid-Atlantic Markets (GlobeNewswire), Rated: B
- United Kingdom
- Funding Circle fund adds firepower for buyback strategy (AltFi), Rated: AAA
- Orca Innovative Finance ISA Launches, Enables Diversified P2P Investment (Crowdfund Insider), Rated: AAA
- Experian, ClearScore scrap merger plans (Reuters), Rated: A
- NatWest launches account aggregation as Open Banking takes hold (AltFi), Rated: A
- Will Open Banking boom in 2019? (AltFi), Rated: A
- Aave Launches Platform to Pay Bills Using Crypto (Finance Magnates), Rated: A
- Investing in crowdfunded development projects – what you need to know (Property Investor Today), Rated: A
- Failed Lender Reaching ‘From Beyond The Grave,’ MPs Warn (Law360), Rated: A
- Some Bankers Are Doing Even Worse Than in 2009 (The Washington Post), Rated: AAA
- Marketplace Lending – A Growing and Dynamic Global Market (DBRS Email), Rated: AAA
- Bank on it: How Enova’s software expands credit access worldwide (Built in Chicago), Rated: A
- Blossom Capital scores $ 85m from Robinhood and Funding Circle backers (AltFi), Rated: A
- Eight Simple Ways to Earn Bitcoin Online Legally (The Crypto Updates), Rated: B
- European Union
- Grid Finance suspends taking investments below € 100,000 (Irish Times), Rated: AAA
- Dragon Victory International: Exposure To The Chinese Crowdfunding Market At A Regulatory-Driven Discount (Seeking Alpha), Rated: AAA
- China Fintech Today: The P2P Boom Is Truly Over (SupChina), Rated: A
- A Crypto Project That Raised $ 20 Million Is Caught Faking Its Founding Team (CoinDesk), Rated: A
- Tencent-backed brokerage firm downsizes US IPO amid weak market demand (Technode), Rated: A
- How should accountants talk to clients about fintechs? (In the Black), Rated: A
- LenDenClub crosses 1,00,000 borrowers and lenders milestone (News Barons), Rated: AAA
- Why Do Fintech Startups and Investors See a Huge Potential in Lending? (Entrepreneur), Rated: AAA
- Banning of UDS to benefit P2P Lending Industry (Inventiva), Rated: A
- Singapore fintech investments rose two-fold to US$ 365m in 2018 (SBR.com.sg), Rated: AAA
- Validus Capital raises $ 15m for SME financing (Fintech Futures), Rated: A
- Latin America
- PayPal expands its small business loans initiative to Mexico (Leaprate), Rated: AAA
- ID Finance eyes ‘pivotal moment’ for Latam fintech as revenue in region climbs 403% (Fintech Finance), Rated: A
- Challenger bank N26 expands to Brazil (Fintech Futures), Rated: A
- How FinTech Companies Inspire Africa With Mobile Technology (PYMNTS), Rated: AAA
Fintech Startup SoFi to Roll Out Crypto Trading Via Partnership With Coinbase (CoinTelegraph), Rated: AAA
Fintech startup SoFi — known for its online lending services — is partnering with major United States-based crypto exchange Coinbase to roll out crypto trading support, according to a CNBC report Feb. 26.
Millennial online lender SoFi to offer zero-fee ETFs, an unexpected rival for index fund giants Vanguard, iShares (CNBC), Rated: A
The race to zero-fee exchange-traded funds has found an unlikely competitor: Online lending and personal finance platform SoFi, which has filed for two index ETFs that will waive management fees for the first year. In making the move to zero-fee ETFs, the online lender is crashing an ETF party dominated by Vanguard and BlackRock‘s iShares.
FTC orders SoFi to stop misleading consumers (MPA Mag), Rated: B
The Federal Trade Commission has ordered online lender SoFi to stop lying about how much borrowers can save by refinancing with the company.
Digital lender founded by ex-SoFi CEO raises $ 65M to fuel expansion (American Banker), Rated: A
The new company founded by Mike Cagney, the former embattled chief executive of Social Finance, plans to announce a $65 million funding round on Wednesday, bolstering firm’s expansion into other financial services, including wealth management.
With the new venture, Cagney is using some of the strategies from his tenure at SoFi — like diversification into areas typically only occupied by traditional banks. However, the new company, Figure, is focusing on different customers, and it’s taking steps to avoid scandals similar to the ones that saw Cagney step down from the SoFi helm.
Walmart teams with Affirm to offer point-of-sale loans (American Banker), Rated: AAA
Walmart will offer its customers point-of-sale loans for the first time — both on its website and in nearly 4,000 U.S. stores — under a partnership with the Silicon Valley lender Affirm.
Under the deal, Walmart shoppers will be able to get Affirm loans of three, six or 12 months to finance purchases ranging from $150 to $2,000. The loans are already being offered in Walmart stores, and they will be available to Walmart’s online shoppers in the coming weeks.
Affirm’s latest partnership brings its alternative financing to Walmart’s US stores and website (TechCrunch), Rated: A
The companies announced this morning that Affirm’s financing options would be made available in more than 4,000 Walmart Supercenters across the U.S., and will roll out to Walmart.com in the weeks ahead.
The offering will go live across Walmart Supercenters nationwide, except in Iowa, West Virginia and Puerto Rico, and will be soon available on Walmart.com.
Loan app Affirm CEO breaks down new Walmart partnership (CNBC), Rated: A
ABS Vegas – 2019 Securitization Update; Square Charter Status (PeerIQ), Rated: AAA
In regulatory news, Square’s ILC charter application has received opposition from 37 community groups. The groups are concerned about Square’s CRA activities and have asked the FDIC to bolster Square’s CRA requirements. Before this letter from community advocates, nearly all of the 15 letters the FDIC received were in favor of Square’s bid. Square is the furthest along the path to getting an ILC charter and its experience will determine whether other FinTechs follow its lead.
Structured Credit Investor magazine explores the challenges facing the maturing marketplace lending sector. Issuers need to distinguish between the borrower experience that they provide and manage liquidity. The article also makes the point that the sector is ripe for consolidation, although we haven’t seen any M&A yet.
2019 Securitization Update
The first two months of 2019 saw 5 securitization deals totaling $1.7 Bn in new issuance. The issuance volume represents a 23% drop over that seen in the first two months of 2018, as the market recovers from the volatility in equity and credit markets seen at the end of 2018. Total securitization issuance now stands at $46.2 Bn, with 147 deals issued to date.
The Housing Market’s 10 Year Challenge — Comparing The Housing Market of 2009 to Today (LendingTree), Rated: AAA
When the real estate bubble burst in late 2008, many Americans saw their home values fall drastically, but a lot has changed in the 10 years since — housing prices have rebounded from their lows during the Great Recession. And though prices are now starting to cool, in many cases, home values have even exceeded their 2006 highs.
On average, median home values have increased by nearly $50,000 across the 50 largest metros in the United States since 2009.
Metros where housing prices have recovered the most since 2009
San Jose, Calif.
Median home value 2009: $638,300
Median home value 2017: $957,700
Median home value change: $319,400
Median unemployment rate change: -6.4%
Median household income change: $32,991
Median home value 2009: $591,600
Median home value 2017: $849,500
Median home value change: $257,900
Median unemployment rate change: -5.4%
Median household income change: $27,889
Median home value 2009: $463,600
Median home value 2017: $617,100
Median home value change: $153,500
Median unemployment rate change: -5.0%
Median household income change: $11,467
Gen Xers Carry the Biggest Auto Loan Burden; Study Finds (One World Herald), Rated: A
According to the loan comparison website, the median balance of Gen Xers who have auto loans is $18,741 is higher than other age groups. It is 9% more than baby boomers’ $17,185 median balance. This is higher than millennials’ $16,200 and 37 percent more than the lowest median balance of $13,666 held by Gen Z.
Personal Loan Interest Rates for February 2019 (Nerdwallet), Rated: AAA
Personal loan interest rates, whether you’re considering a loan from a bank, credit union or online lender, generally range from about 6% to 36%. The actual rate you receive depends on factors such as your credit score and history, annual income, existing debt and where you get the loan.
Online lenders offer the lowest starting interest rates on personal loans to borrowers with good to excellent credit.
LightStream and Marcus both require a minimum credit score of 660. LightStream accepts joint applications, and one applicant can have a credit score lower than its minimum. SoFi has a slightly higher credit score requirement and requires at least $45,000 in annual income.
Elevate Credit (ELVT) Posts Earnings Results, Meets Expectations (Fairfield Current), Rated: A
Elevate Credit (NYSE:ELVT) announced its quarterly earnings results on Monday, February 11th. The company reported $0.09 earnings per share (EPS) for the quarter, meeting the Zacks’ consensus estimate of $0.09, Bloomberg Earnings reports. The business had revenue of $207.29 million for the quarter, compared to the consensus estimate of $212.42 million. Elevate Credit had a return on equity of 15.72% and a net margin of 1.59%. Elevate Credit updated its FY 2019 guidance to $0.55-0.65 EPS.
Hunt Real Estate Capital buys RealtyMogul’s proprietary loan underwriting program (Housing Wire), Rated: A
Hunt Real Estate Capital, which offers financing for all types of commercial real estate, will soon have a new underwriting system to help it originate those loans, as the company is buying a proprietary loan underwriting system from RealtyMogul.
Elevate’s Joan Kuehl Named Dallas ORBIE CIO of the Year (The Progress), Rated: B
Elevate Credit, Inc. (“Elevate”) today announced that Executive Vice President and Chief Information Officer Joan Kuehl has been named the Large Enterprise CIO of the Year by the Dallas ORBIE CIO of the Year Awards. The award honors chief information officers who have demonstrated excellence in technology leadership.
If those predictions prove true, it will be the first major economic downturn for some of the nation’s leading fintechs. Born out of the ruins of the recession, these startups have enjoyed nearly a decade of success buoyed by strong economic growth, a bull run in the stock market and low unemployment.
Here’s more on the AJC Top Workplaces midsize companies (AJC.com), Rated: B
Kabbage has been named to the list for five consecutive years and this is its first year in the top five. The private financial technology company, founded in 2009, has 489 global employes and 367 at its U.S. headquarters in Atlanta. Flexibility at work and perks, such as a daily catered lunch and snacks, are among reasons employees appreciate working for Kabbage. Wellness benefits include fitness classes, health equipment onsite, biweekly meditation classes, CPR training, an annual flu shot clinic and sponsoring sports clubs. It also fully pays health benefits for individuals and provides annual bonuses and a 401(k) match. Through its sabbatical program, employees of five years can receive six weeks of paid time off and an additional $6,000. In 2018, Kabbage participated in the Atlanta PRIDE parade and also took a stand against gun violence after the mass shooting at Stoneman Douglas High School. Workers in 2019 will build a Habitat for Humanity home as part of its Kabbage Kares program, which also has supported PAWS Atlanta, Easter Seals and the Epilepsy Foundation.
Diversifying a Self-Directed IRA Made Simple with New Offering from CrowdStreet (The Progress), Rated: A
CrowdStreet, an online marketplace for direct equity investment in commercial real estate (CRE), today launched a streamlined, investor-friendly approach to investing qualified retirement account funds into commercial real estate offerings. This new option makes it easier than ever for individuals to access CRE investments with their self-directed IRAs (SDIRA), thus reducing their investment exposure to a volatile stock market and achieving more independence in managing their investments.
Liquid P2P and Interest Radar Announce Strategic Partnership (Liquid P2P), Rated: A
Liquid P2P and Interest Radar are pleased to announce that they have entered into a strategic partnership. The two third-party investing services for online peer-lending giant Lending Club will combine strengths under a single platform to deliver a more comprehensive automated tool with a patent-pending liquidity solution.
Direct Lending Investments Suspends Investor Withdrawals (Lend Academy), Rated: A
Earlier this month Brendan Ross, the CEO of Direct Lending Investments, Inc., sent a letter to investors notifying them that they have suspended withdrawals and redemptions effective February 8, 2019. Lend Academy was able to obtain a copy of this investor letter, dated February 11, that provides some color into what happened. The reason given was the delinquency of a large holding, VOIP Guardian, a telecom receivables factoring company.
Fintech deal will provide access to midsize businesses in U.S. (American Banker), Rated: A
Add HSBC to the list of banks partnering with commercial online lenders.
The bank on Tuesday announced a partnership with Neptune Financial, a San Francisco online lender that focuses on businesses with $10 million to $100 million in assets. The bank estimates that, with the access it will get to Neptune customers, the deal represents a $1.5 trillion opportunity.
Venmo debuted a limited-edition rainbow-colored card (Business Insider), Rated: A
Venmo, the PayPal-owned peer-to-peer (P2P) giant, debuted a limited-edition rainbow-colored version of its physical card product. The card will function the same as regular Venmo cards, allowing customers to pay wherever Mastercard is accepted, split costs and tips, withdraw funds from select ATMs, and manage their Venmo balance, but it will only be available for as long as supplies last, according to Venmo.
Why digital identities will be so important in the next few years, according to Mastercard’s vice chairman (CNBC), Rated: A
The pace with which we are moving toward the internet of things is “very rapid” but we “can’t have the internet of everyone without the inclusion of everyone,” according to the vice chairman of payments giant Mastercard.
“You have to start focusing on how does the human get involved, and that’s going to be through having a digital identity,” Ann Cairns told CNBC’s Karen Tso on Monday at the Mobile World Congress in Barcelona.
Credit Karma’s Dana Marineau: ‘We want users to think of us as more than just free credit scores’ (Tearsheet), Rated: A
Today’s marketer on the hot seat is Dana Marineau, Credit Karma’s vice president of brand, creative and communications. People love Credit Karma for its free credit scores, but the company provides so many other free tools. Dana’s team is tasked with elevating the brand beyond just free credit scores, as a place to get help with financial decisions and achieve financial progress. She brings a 15 year experience at EA, working on many of the top sports games in the business.
Why this small bank created a separate, digital-first brand (American Banker), Rated: AAA
When Midwest BankCentre, a community bank in St. Louis, launched the digital-first Rising Bank in February, it joined the ranks of other financial companies —generally large players such as JPMorgan Chase, Wells Fargo and MUFG Union Bank — that have created separate, digital-only brands. Unlike them, the $1.9 billion-asset Midwest hopes to keep a community bank feel at the internet-only unit.
The Future Is Plastic: Fintech Unicorn Brex Launches New Credit Card For E-Commerce Merchants (Forbes), Rated: A
Brex, a San Francisco credit card startup that reached a valuation of $1.1 billion late last year, 22 months after its founding, is launching its second product, a physical credit card for e-commerce companies. Its first card, targeted to venture-backed tech startups, has attracted more than 3,000 customers by providing higher spending limits and simplifying the application process.
YieldStreet raises $ 62M to democratise alternative investments in shipping, real estate and more (TechCrunch), Rated: A
YieldStreet — which provides a platform for making alternative investments in areas like real estate, marine/shipping, legal finance, commercial loans and other opportunities that in the past were only open to institutional investors — is today announcing that it has raised $62 million in a Series B round of funding.
Guaranteed Rate Leads Mortgage Executive Magazine’s List of Top Loan Originators in America (GlobeNewswire), Rated: A
For the seventh consecutive year, Guaranteed Rate has the most loan originators of any lender on Mortgage Executive Magazine’s annual list of the “Top 200 Mortgage Originators in America,” including the number one originator.
Guaranteed Rate led the way with 36 originators ranking within Mortgage Executive Magazine’s Top 200, including three of the top five. Shant Banosian of Boston, Mass., was named the nation’s 2018 Top Originator by funding $536 Million in total loan volume.
Americans Focus On Debt Management But Lose Focus On Retirement Savings (Forbes), Rated: A
U.S. banking regulator fights NY lawsuit over fintech charters (Reuters), Rated: A
The U.S. Office of the Comptroller of the Currency has asked a Manhattan federal court to dismiss a lawsuit by a New York financial regulator over its plan to issue banking charters to fintech companies, saying the lawsuit is premature.
Blockchain and data protection: the main concerns (JDSupra), Rated: A
Blockchain’s usage is no longer limited to digital crypto currencies, as blockchain databases may be deployed in innumerable circumstances and scenarios, including, for instance, within the financial services and insurance sectors for money transfer, peer-to-peer lending and transfer of securities, as well as automatic execution of contracts.
LoanStreet positions for growth with new hires (LoanStreet Email), Rated: B
After the launch of LoanStreet’s commercial lending product and the announcement of their $6.5 million funding round, LoanStreet – the first fully-integrated platform that streamlines the process of sharing, managing, and originating loans – has appointed three credit union industry veterans to support LoanStreet’s aggressive growth.
These new hires include Mike Doherty, Managing Director and Head of Credit Union Sales; Tony Harter, Business Development Director; and Joe Parvin, Business Development Director.
White Oak Business Capital Hires Carol Bader Apicella to Expand Northeast and Mid-Atlantic Markets (GlobeNewswire), Rated: B
White Oak Business Capital, Inc. (“WOBC”), an affiliate of White Oak Global Advisors, LLC, has announced that Carol Apicella has joined the firm as Senior Vice President and Senior Business Development Officer. Apicella will be responsible for expanding the firm’s markets in the Northeast and Mid-Atlantic.
Funding Circle fund adds firepower for buyback strategy (AltFi), Rated: AAA
The portfolio, an investment trust, of loans originated by Funding Circle lowered its dividend expectations amid lower projected returns last year prompting a discount to its net asset value.
Following a move to a more than 10 per cent discount last year it started share buybacks in a bid to narrow its discount. It has now made additional capital available from its free cash flow to be deployed into share buybacks, the fund said yesterday.
Orca Innovative Finance ISA Launches, Enables Diversified P2P Investment (Crowdfund Insider), Rated: AAA
Orca Money is finally launching its long-anticipated Innovative Finance ISA (IFISA). Orca’s spin on the savings vehicle allows investors to spread their money across multiple peer-to-peer lenders (P2P) thus providing a heightened degree of diversification. Additionally, Orca Money conducts due diligence on behalf of IFISA investors.
Currently, the Orca IFISA allows access to 5 P2P platforms: Lending Works, Assetz Capital, Landbay, Octopus Choice and Lending Crowd.
Experian, ClearScore scrap merger plans (Reuters), Rated: A
Experian Plc, the world’s biggest credit data firm, said on Wednesday that it had agreed with rival ClearScore to abandon their proposed merger, after Britain’s competition watchdog indicated that it may block the deal.
NatWest launches account aggregation as Open Banking takes hold (AltFi), Rated: A
It’s been a long time coming, but Open Banking is finally spreading through the traditional banking industry, this week with the launch of account aggregation for NatWest customers.
The RBS subsidiary becomes the UK’s 4th bank to let customers connect rival current accounts.
Will Open Banking boom in 2019? (AltFi), Rated: A
It has been over a year since the Open Banking UK initiative under the Competition and Markets Authority order and Second Payment Services Directive (PSD2) was launched and has become one of the industry’s biggest technology and regulatory shake ups in recent years. It is no surprise that the initiative’s first year has seen a relatively low consumer uptake. This has been coupled with reports that consumers’ knowledge of the scheme appears to be markedly low.
Aave Launches Platform to Pay Bills Using Crypto (Finance Magnates), Rated: A
In an attempt to bring crypto closer to the mainstream, the London-based fintech startup has announced the launch of Aave Pay.
The app will allow its users to pay their utility bills using digital coins by converting crypto into fiat in real-time using bank transfer facility. The company is claiming that the platform can be used to business expenses as well including employee salaries, income taxes, and other commercial or corporate expenses.
Investing in crowdfunded development projects – what you need to know (Property Investor Today), Rated: A
You can invest in peer to peer development loans for the short term or in an Innovative Finance ISA for a longer commitment period, but with the potential to earn tax free returns.
By comparison, a peer to peer lending platform with its own development company will have much more control over its projects and be able to give you more detailed and trustworthy updates.
Failed Lender Reaching ‘From Beyond The Grave,’ MPs Warn (Law360), Rated: A
Failed payday lender Wonga is damaging the finances of thousands of customers “from beyond the grave” because they cannot seek redress for allegedly missold loans as the company was not covered…
Some Bankers Are Doing Even Worse Than in 2009 (The Washington Post), Rated: AAA
It may not feel like it, but some corners of banking are suffering as badly as they did during the depths of the financial crisis. Global volumes of initial public offerings and share placings in January and February have been nearly 60 percent lower than in the same period last year. The numbers are worse than the first two months of 2009. If activity doesn’t pick up soon, it would be worrying evidence of the fragility of investor sentiment.
The hope is that the lull is temporary, and technical. The government shutdown in Washington has gummed up U.S. IPOs. Uncertainty over the U.K.’s future relationship with Europe just drags on. And the December stock-market wobble probably killed off deals that were being planned for the window that traditionally opens between January and the start of the full-year earnings season in late February.
Marketplace Lending – A Growing and Dynamic Global Market (DBRS Email), Rated: AAA
I wanted to share with you a new joint report from our U.S. and European structured finance teams. The new report, attached to this email, analyzes the growth of the marketplace lending market around the globe.
The commentary includes the following topics:
— The evolution in finance, from traditional banking to FinTech.
— FinTech’s influence on marketplace lending around the globe.
— Growth hurdles.
— Securitization considerations.
Bank on it: How Enova’s software expands credit access worldwide (Built in Chicago), Rated: A
Not all credit histories are created equal.
That’s the case for a large part of the world’s population who can’t get access to a loan from a traditional credit provider — like a bank — creating a world in which the hardest working people don’t always get access to the credit they need. Enova, however, believes it has a solution. The fintech company draws on the power of machine learning and data to offer products that expand access to credit for consumers and small businesses.
Blossom Capital scores $ 85m from Robinhood and Funding Circle backers (AltFi), Rated: A
Blossom Capital, which has already backed five startups including rental marketplace Fat Lama, today raised $85m which it will use to lead Series A rounds of between $5m and $10m in Europe.
Eight Simple Ways to Earn Bitcoin Online Legally (The Crypto Updates), Rated: B
Earn Bitcoins as the interest payments: If you have earned some Bitcoins already, you can put the Bitcoins to earn for you. Lend them out at particular interest rate. You can lend the Bitcoins directly to someone known at a greed interest rate and repayment period. You need to assess trustworthiness of borrower. Peer to peer Bitcoin lending is another way to let the earned Bitcoins earn for you. There are many peer-to-peer lending websites where the borrowers post the borrowing requests. Over these websites, you can act as a lender. It is also possible to fund the small portion of numbers of loans to reduce the risk.
Grid Finance suspends taking investments below € 100,000 (Irish Times), Rated: AAA
One of the largest providers of peer-to-peer loans in the State has shut down a key part of its business aimed at smaller investors, blaming an absence of regulation in the crowdfunding space.
Grid Finance, which is backed by Enterprise Ireland, wrote to holders of its “Brick” accounts – that facilitate the investment of up to €100,000 – in recent days stating that it would withdraw the offering from the marketplace.
Dragon Victory International: Exposure To The Chinese Crowdfunding Market At A Regulatory-Driven Discount (Seeking Alpha), Rated: AAA
In recent years as China winds down its industrial and manufacturing powerhouse growth, it’s looking to other developed nations to determine which platforms it should invest in and pave the way to sustained economic growth. As most other major developed nations have done over the past century, financial services and engineering have been a very profitable platform and companies in China are quick to launch their own services to capitalize on the triple-digit growth in online financial services exhibited since 2003.
Similar to Hexindai (HX), which I’ve previously covered as a leading online lender which is capitalizing on the middle class appetite for debt to finance their lives and vacations, Dragon Victory International Limited (LYL) is taking on the crowdfunding segment in the People’s Republic of China. Similar to countless other platforms around the world, the company’s services are around financing new companies and capitalizing entrepreneurs through public funding and they already have over 4.5M users who use their services, a number nearly doubling each year.
China Fintech Today: The P2P Boom Is Truly Over (SupChina), Rated: A
This year, the government has continued to lead a reorganization of the industry:
- More companies will die: As of February 17, only 60 percent of online lending institutions had disclosed their operational information for January 2019, including five problematic platforms.
- However, the current asset quality of the online lending industry has improved significantly according the data from firms that did report.
- As of the end of January 2019, the accumulated amount of the online P2P online loan industry was about 7.78 trillion yuan ($1.16 trillion). The total loan amount in January was 91.4 billion yuan ($13.61 billion), down 55.1 percent year-on-year and down 1.3 percent from the previous month.
- Further consolidation of industry players is certain. Some experts quoted in media reports predict that the scale of future online loans will continue to shrink because of regulation.
- Some listed companies, such as Aoma Electric and Panda Financial Companies, have abandoned their P2P businesses.
- Aoma Electric issued a letter of concern to the Shenzhen Stock Exchange on February 14, attributing the decision to the broader economic slowdown, and a high number of overdue loans.
- Panda Gold Control in 2018 was also dragged down by its P2P business, and expects a net loss of 41.16 million ($6.13 million) to 57.63 million yuan ($8.58 million) in 2018. Faced with the uncertainty of the P2P sector, Panda Gold Control chose to divest.
How should accountants talk to clients about fintechs? (In the Black), Rated: A
Like the ombudsman’s office, ASIC has also made information available to educate consumers and advisers, including on its MoneySmart Borrowing Basics and Peer-to-Peer Lending sites.
Is any flexibility possible, Shiel wonders, with a peer-to-peer lending model in which the borrower likely doesn’t know who is providing the funds?
LenDenClub crosses 1,00,000 borrowers and lenders milestone (News Barons), Rated: AAA
LenDenClub, one of India’s fastest growing peer-to-peer (P2P) lending platforms, recently crossed an important landmark with more than 1,00,000 borrowers and lenders on its platform. The breakdown of borrowers to lenders is 83,300 and 16700, respectively. The company crossed this milestone by keeping up with latest market trends, and saw an increase in the use of its product InstaMoney, which was launched in June 2018.
Why Do Fintech Startups and Investors See a Huge Potential in Lending? (Entrepreneur), Rated: AAA
Today, thanks to the ongoing digitization, borrowing has become as easy as it can get in India. For contrast, all it takes now is the touch of a few buttons, answers to a few verification-related questions, and anyone can receive a loan in a matter of hours or days, if not minutes. And all of this is without any collateral and while enjoying the comfort of your home. Now, compare this with taking a day off to go to the bank, doing extensive paperwork, visiting frequently to check the progress of your loan application, and ultimately, getting your application rejected because of the loan officer’s misjudgement. All while wasting two months of time in the constant to and fro and taking multiple days off from your office.
It is beyond doubt that the advent of fintech startups has altered the game of lending in India. It has become both simpler and convenient to borrow using their revolutionary approaches driven by state-of-the-art technologies. Currently, more than 1,500 fintech startups (of all shapes and sizes) are catering to the Indian market, and more than half of these startups have been launched over the last 3 years. This gives us a clear picture of how lucrative the sector is becoming for our startup ecosystem. But what is essentially fuelling this trend? Let’s find out.
Banning of UDS to benefit P2P Lending Industry (Inventiva), Rated: A
The latest ordinance of the Banning of Unregulated Deposits (UDS) 2019, was passed by the government to provide a comprehensive mechanism to ban UDS as well as to protect the interest of depositors. This is in line with the Reserve Bank of India’s guidelines on the NBFC-P2P sector, issued in October 2017 to regulate the unorganized lending business in the country.
Singapore fintech investments rose two-fold to US$ 365m in 2018 (SBR.com.sg), Rated: AAA
US$102.2m of the total funds raised went to lending fintech companies such as the homegrown Funding Societies.
Fintech investments in Singapore more than doubled to US$365m in 2018 from US$180m in 2017, putting the country amongst the top five fintech markets by funds raised last year in Asia Pacific, behind China, India, Australia and Japan, according to Accenture’s analysis of CB Insights data. The number of deals in the country rose to 71 from 61 in 2017, making it the third busiest market in the region, behind only China and India.
Validus Capital raises $ 15m for SME financing (Fintech Futures), Rated: A
Validus Capital, a Singapore-based SME financing platform, has raised SGD 20.5 million ($15.2 million) in a Series B funding round, led by FMO, a Dutch public-private development bank.
PayPal expands its small business loans initiative to Mexico (Leaprate), Rated: AAA
Online payment giant PayPal launched its Working Capital initiative in 2013 as an alternative method for business to access working capital much faster than through traditional means. Many small and medium-sized business (SMB) clients embraced the program and since then the company has advanced more than $6 billion in loans to over 170,000 businesses in the UK, US, Germany and Australia.
PayPal also recently revealed that it has partnered with Konfio, a Mexican online lender that utilizes unconventional data sources to facilitate fast credit assessments, in a deal that will allow PayPal to extend its Business loan and working capital programs to Mexican businesses.
ID Finance eyes ‘pivotal moment’ for Latam fintech as revenue in region climbs 403% (Fintech Finance), Rated: A
ID Finance, the fintech company operating in Europe and Latin America, saw revenue of $49m in 2018. This represents growth of 236% for the business, which was formally separated from its operations in Russia and CIS region last year.
The company is enjoying particularly strong growth in Latam, one of the world’s fastest growing markets for fintech adoption thanks to high mobile penetration and a sizeable underbanked population – according to the World Bank 61% of Mexico’s population is excluded from the traditional banking system, while 40% of Brazil’s 207m population are blacklisted. The company now has 141 employees in Latam and saw revenue growth of 403% in the region last year.
Challenger bank N26 expands to Brazil (Fintech Futures), Rated: A
Germany-based mobile challenger bank N26 is powering on yet again as it has revealed its plans to expand to Brazil.
How FinTech Companies Inspire Africa With Mobile Technology (PYMNTS), Rated: AAA
With the potential for rapid growth and job creation, FinTech firms in Africa have caught the attention of global investors. According to the London Stock Exchange Group’s 2019 “Companies to Inspire Africa” report, which highlights these firms, the FinTech sector has the second highest growth rate representation of technology and telecoms as well as financial services. As it stands, companies in this space represent more than a quarter of 360 featured firms from 32 different countries. Pan-African payments firm Cellulant is among the companies that appeared in the first and second editions of the report.