Thursday September 19 2019, Weekly News Digest

MAS Singapore

News Comments Today’s main news: SoFi to get its name on a football stadium. Petal raises $300M. Funding Circle closing in on 1-year anniversary of float. Zopa sends warning of imitation scams. Cumulative UK alt lending hits 11.3B GBP. Companies to get social credit in China. Today’s main analysis: Student loan refinancing rates are down. […]

The post Thursday September 19 2019, Weekly News Digest appeared first on Lending Times.

MAS Singapore

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United States

Sundays at SoFi: NFL Stadium in Inglewood Lands a Corporate Name (Commercial Observer), Rated: AAA

Online lender SoFi Lending Corp. has secured the naming rights and a 20-year deal with the Rams and Chargers, according to the Los Angeles Business Journal. The firm agreed to pay around $20 million per year, reports say.

SoFi Stadium, which will be the largest in the NFL, is the centerpiece to the much larger $5-billion Hollywood Park project developed by Rams Owner/Chairman E. Stanley Kroenke. Construction is 75 percent complete, and the stadium is expected to open next summer for other events before the NFL preseason begins in August.

Taylor Swift to Open SoFi Stadium Next Summer (KFI AM 640), Rated: B

The opening of the $2.6 billion SoFi Stadium will happen next summer on July 25th. However it’s not for a Rams or Chargers game. Swift announced that she will play two shows (July 25th and July 26th) at the stadium as a part in her much-anticipated 2020 world tour.

Economy is Top Concern for Small Businesses Ahead of 2020 Election (OnDeck), Rated: AAA

Key Findings from the OnDeck Small Business Survey:

  • 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.

President Donald Trump was the choice of 37% of small businesses surveyed, followed by Joe Biden at 18%. When combined, the top five Democratic candidates were the preference of 44% of respondents.

Student Loan Refinancing Rates Down Sharply (Credible), Rated: AAA

During August:

  • Rates on 10-year fixed-rate loans averaged 4.70%, down 22% from a July 2018 peak of 6.05%
  • Rates on 5-year variable-rate loans averaged 4.03%, down 14% from September

A borrower repaying the average graduate school debt of $84,300 over 10 years at 6.36% interest — the average rate for grad school loans in recent years — could save:

  • $20,927 by refinancing into a 5-year variable rate loan
  • $8,327 by refinancing into a 10-year fixed-rate loan

Credit card start-up Petal raises $ 300 million debt round from Jefferies (CNBC), Rated: AAA

The New York City-based company announced a $300 million debt round from Jefferies on Tuesday, adding to existing venture capital investments from names like Peter Thiel’s Valar Ventures.

Plaid adds credit card data to Liabilities product (Tearsheet), Rated: A

In July, Plaid launched its Liabilities product that gives developers access to real time information about what consumers owe. Expanding beyond student loan data, the company has added support for credit card information, so firms can build better debt management solutions.

GoCardless launches US debit payments solution and opens San Francisco office (TechCrunch), Rated: A

GoCardless, the London fintech that aims to become the one-stop shop globally for businesses that want to let customers pay via recurring bank payments, has launched a U.S. debit solution.

Specifically, GoCardless’  new U.S. product supports debit payments on the ACH (Automated Clearing House) network.

The company has also opened an office across the pond in San Francisco’s financial district, headed up by Andrew Gilboy, general manager, North America, who was previously the company’s chief revenue officer.

Nav Launches New Feature to Help Business Owners Boost Business Credit (PR Newswire), Rated: A

Today Nav, a fintech company that matches business owners with their best financing options for free, announced new offerings to help small business owners boost their business credit scores, giving an easy solution to developing a strong business credit profile that alternative and traditional lenders can trust and finance.

Why would HUD gut its own disparate impact rule? (The Times Weekly), Rated: AAA

Since 2013, the disparate impact rule has objectively examined the effects of business practices with lenders, landlords, insurers, and real estate professionals against the provisions of the 1968 Fair Housing Act. The rule required that first a plaintiff must establish a discriminatory effect in policies and/or practices, before the defendant(s) would bear the responsibility of proving their own practices were nondiscriminatory.

During delivery of Capitol Hill testimony earlier this spring, Nikitra Bailey, an EVP with the Center for Responsible Lending (CRL) also underscored the importance of disparate impact in fair housing.

“Disparate impact analysis encourages creative approaches that both increase effectiveness and inclusion,” testified Bailey. “This process and the value of disparate impact analysis was recently pointed out and endorsed by the largest personal loan company in the country, Lending Club.”

BlueVine Appoints Dosh & PayPal Vet Brad Brodigan As New Chief Commercial Officer (Crowdfund Insider), Rated: A

Online lender BlueVine announced on Wednesday it has appointed Brad Brodigan as its new Chief Commercial Officer. BlueVine reported that through this role, Brodigan will be responsible for overseeing revenue-generating functions including sales, customer service, and partner management.

Money360 Closes $ 170 Million in Commercial Real Estate Loans in July and August (GlobeNewswire), Rated: A

Money360, a technology-enabled direct lender specializing in commercial real estate (CRE) loans, announced today it closed approximately $170 million in loans during July and August. This benchmark brings Money360 close to $500 million in loans closed this year.

Groundfloor Now Allows Real Estate Developers to Gain Pre Approval on Loans (Crowdfund Insider), Rated: A

Groundfloor, a real estate lending and investing platform that allows anyone to participate directly in real estate investments, has launched a new product to make the lending process more easier for real estate investors. Groundfloor now allows certain developers to gain pre-approval on loans with a new program called “QC Maxx.”

ABS East; Stripe’s Lending Arm; Madden Decision (PeerIQ), Rated: A

In financing news, student loan fintech “College Ave” locked down a $300MM securitization and a AAA rating this week. The securitization was co-led by both Barclays and Goldman Sachs. Affirm, led by Max Levchin, is reportedly close to wrapping up a $1.5 Bn debt and equity financing with Thrive Capital and Spark Capital leading.

Stripe is mirroring other payments companies that have since built lending capabilities – notably, Square and PayPal. Stripe believes it can compete in an already crowded small business lending market (OnDeck, Kabbage, Fundera, Funding Circle, etc.) due to its data & channel advantages stemming from its payments business.

Fintech Firm OppLoans Announces Its First Bank-Led Credit Facility (GlobeNewswire), Rated: A

OppLoans, a growing fintech and top rated direct-to-consumer online lending platform, announced today that it has secured its first bank-led asset-backed revolving credit facility. This facility structure will enable OppLoans to further its mission by broadening access to online personal lending products for more middle-income consumers with credit challenges.

Aura Completes Three Social Bond Issuances Totaling 5 million Over Last 4 Months (Yahoo! Finance), Rated: A

M&G Investments and Community Capital Management, a mutual fund that specializes in impact and Community Reinvestment Act (CRA) related investments, have joined with U.S. and international banks to invest $145 million in Aura’s social bonds to finance the origination of affordable, small dollar installment loans to working families in the United States.

Challenger banks insist they’re equal to the task of lending (American Banker), Rated: A

Almost all U.S. challenger banks offer no-fee checking, savings accounts and enhanced personal financial management tools. Now some of the most popular have taken, or are poised to take, their next step: making loans.

Personal loans and credit cards are lucrative but inherently risky, and these young companies — like MoneyLion, Varo and others — will have to prove to regulators, investors and the public that they have the wherewithal to weather downturns in the credit cycle.

Cash-flow data shows promise as predictor of credit risk (American Banker), Rated: A

Melissa Koide, co-founder and CEO of FinRegLab, analyzed loan data from six lenders that use cash-flow data in their underwriting. She shares what she found.

Prevu Raises $ 2 Million in Seed Funding to Grow its Digital Home Buying Platform (Digital Journal), Rated: A

Prevu, a customer-focused digital home buying platform delivering industry-leading efficiency and savings, announced today the closing of its $2 million seed funding round. The round was led by Corigin Ventures, a prominent seed-stage venture capital firm with expertise in the real estate technology and consumer industries as well as a history of backing startups disrupting residential brokerage business models.

Embattled Prodigy Network CEO Rodrigo Niño to step down (The Real Deal), Rated: A

Prodigy Network founder Rodrigo Niño is stepping down from his position as CEO amid mounting financial and legal issues, The Real Deal has learned.

Prodigy, a real estate crowdfunding platform, has faced criticism from investors in recent months over underperforming investment properties and unpaid distributions. On Monday, an investor in one of Prodigy’s newest projects — the 13-story Standard Hotel in Chicago — filed a lawsuit alleging the firm was “insolvent” and had used investments “for purposes other than those relating to the project.”

EquityMultiple Provides Investors with Options to Take Advantage of Unique Tax Benefits (Crowdfund Insider), Rated: A

Opportunity Zones are new, tax-advantaged vehicles for investors to earn more on their money. Created by the Tax Cuts and Jobs Act of 2017, the first qualified opportunity zones (QOZs) first hit the market in early 2018. Designated by state authorities, there are now thousands of QOZs in the US designed to boost development in selected communities. Investors receive a break on capital gains taxes which can be significant. Local officials can spur economic development which leads to more jobs. Online investment platforms immediately saw the opportunity intrinsic to QOZs with multiple platforms now offering investments in developments that benefit from these tax breaks.

Why are your Opportunity Zone Offerings better than some others available on competing investment platforms?

Soren Godbersen: There are a number of firms out there now marketing Opportunity Zone offerings to investors. We’re proud of what we have been able to offer to our investor network and there are a few things about our Opportunity Zone investments that are unique:

How to Recession-Proof Your Investments (U.S. News), Rated: A

AFTER A DECADE OF steady growth, the economic cycle is due for a reversal, with concerns of a recession.

  • Consider other types of investments outside of stocks and bonds.
  • Know that timing the market is difficult.

What to Invest in During a Recession?

Other less correlated assets include the real estate niche. With real estate crowdfunding, hypermarket segmentation is available. Investors can choose their property type and geographic region when investing in real estate. Two real estate crowdfunding platforms for accredited investors are CrowdFund and EquityMultiple. Fundrise and Groundfloor open targeted real estate investing to nonaccredited investors as well.

Litecoin Non-Profit to Hold Undisclosed Treasury Sum with Crypto Lender (CoinDesk), Rated: A

The Litecoin Foundation is putting its capital to work, lending at interest through another cryptocurrency program.

The Foundation has tapped the Celsius Network, a blockchain-based crypto lending program, to become its preferred crypto wallet, Celsius Network CEO Alex Mashinsky told CoinDesk.

As part of the deal, the Foundation will allocate an undisclosed portion of its treasury to the Network. LTC holders can receive up to 10.53% annually back on their crypto holdings and dollar loans as low as 4.95 percent as well.

Fintechs give small business more choice for credit than just banks (PaymentsSource), Rated: AAA

It’s no secret working capital is the lifeblood of all small businesses. It’s the fuel that keeps them running, helps them grow and take on new opportunities.

And yet, so many small businesses struggle with cash flow. In fact, according to a recent study from Intuit QuickBooks, 61% of small businesses have had cash flow issues in the past year.

Source: FIS

Walmart’s New Credit Cards Have One Big Goal: Boost E-Commerce (Bloomberg), Rated: A

In a sign of how much Walmart Inc. is betting on e-commerce, the retailer’s revamped credit-card program with Capital One Financial Corp. offers better rewards for online shopping and checking out with its mobile app.

The new options, which become available Sept. 24 and use Mastercard Inc.’s network, offer 5% cash back for purchases made at Walmart’s website, including groceries. At the chain’s physical stores, shoppers only get that rate for a year and have to check out with Walmart Pay at the cashier. Otherwise, store customers get 2% back.

Finicity Releases New Verification of Income and Employment Solution for Lenders (PR Web), Rated: B

Finicity, a provider of real-time financial data access and insights, announced today the release of its new Verification of Income and Employment (VOIE) solution using patent-pending TXVerify technology that will speed up borrower verifications and further advance the industry shift toward a fully digital experience.

The Finicity VOIE solution digitally extracts a borrower’s pay statement data from the paystub and then cross-verifies that key data with their income transactions from their financial institutions. Enabled by its TXVerify technology, this detailed vetting process creates a real-time picture of an applicant’s income and employment for fast, accurate reports. The solution does this by leveraging the highest value data – direct from banks – along with a scan, photo or PDF of a borrower’s paystubs. This process significantly shifts the current paradigm from a mostly manual process to one that is fully digital, all while reducing fraud and increasing confidence in the underwriting process.

Sallie Krawcheck: Why ‘don’t buy daily coffee’ is terrible advice (CNBC), Rated: B

“Don’t buy daily coffee” is the go-to financial advice. Co-founder and CEO of Ellevest, Sallie Krawcheck, says that advice is misleading and just enjoy your latte.

Ethereum Development Studio ConsenSys Announces Codefi, A New DeFi Software Suite (Crowdfund Insider), Rated: A

ConsenSys founder Joseph Lubin announced at the Ethereal Tel Aviv press conference (on September 15) that his New York-based venture studio is launching a new product, Codefi, for the emerging decentralized finance (DeFi) ecosystem.

Despite not having invested in emerging DeFi platforms, Lubin described P2P lending systems such as Uniswap and MakerDAO as some of the blockchain industry’s most promising projects.

ApplePie Capital Partners with LSQ Funding on A/R Franchise Financing (Monitor Daily), Rated: B

Online lender ApplePie Capital entered into a new strategic partnership with LSQ Funding Group, a technology-enabled provider of accounts receivable financing for small and mid-sized businesses.

United Kingdom

Funding Circle nears one-year anniversary of London float (P2P Finance News), Rated: AAA

The peer-to-peer business lender began conditional dealings on the London Stock Exchange on 28 September before being officially admitted to the bourse on 3 October. It launched with an offer price of 440p per share, giving the firm a valuation of £1.5bn.

However, its market capitalisation as of 17 September has since dropped to £348.7m, with its shares now trading at just over 100p.

Zopa warns over imitation scam firms (P2P Finance News), Rated: AAA

ZOPA has warned over a growing number of scam operators targeting UK customers using the peer-to-peer lender’s name to dupe investors.

They include: asking customers directly for their Zopa login details; claiming to work with companies investing money in Bitcoin or other cryptocurrencies; or working with companies who would ask them to take out a Zopa loan to fund an investment.

Record numbers of investors and borrowers as cumulative lending hits £11.3bn (P2P Finance News), Rated: AAA

MORE than 150,000 lenders were invested in 321,483 loans facilitated by Peer-to-Peer Finance Association (P2PFA) platforms at the end of the second quarter, which the trade body deemed “a record level of involvement in the sector”.

Funding Circle is the largest P2P lender among the P2PFA platform members, having lent out a cumulative total of £5.4bn as of the end of the second quarter. It is followed by Zopa at £4.5bn, with ThinCats in third place with just over £491m.

£814m of new loans were made in the second quarter, compared to £866m in the first three months of 2019.

Monzo halts cash referrals as it hits three million users (AltFi), Rated: A

Monzo has ended its cash incentivised referral system as the firm continues to grow users at a rapid pace.

Monzo now has passed the 3 million ‘users’ number, hitting the milestone late on yesterday and is now onboarding 55,000 people to Monzo every week.

Transferwise Books Its Third Consecutive Year of Profits (Lendit), Rated: A

European fintech company Transferwise has recorded its third year in a row of profits; the company reported its net profit after tax climbed to £10.3 million in the fiscal year ending March 2019, up 66% from the previous year on revenue of £179 million;

Payment provider Klarna appearing at London Fashion Week has everybody talking (MyLondon), Rated: A

UK fashion Designer Henry Holland decided to take things up a notch in Saturdays catwalk show with a T Shirt design in collaboration with Klarna.

Klarna expands partnership with Mothercare (The Paypers), Rated: B

Klarna and Mothercare have announced an extension to their partnership, which will see Klarna’s Pay later, Pay in 3, and Slice it products available online and in-store across the UK.

OakNorth Bank provides £3.7m loan to Clearview Developments (London Loves Property), Rated: A

OakNorth Bank the UK bank powered by OakNorth has provided a £3.7m loan to Clearview Developments for a new residential development in Royal Tunbridge Wells.

Smarterly and OakNorth Bank partner to offer new Notice Cash ISA range to Smarterly customers (Fintech Finance), Rated: B

The product range includes five Cash ISA Notice accounts, exclusive to Smarterly, ranging from 35 days at 1.05% to one year at 1.25%; Customers will not be able to apply for these products with OakNorth directly;

These five Cash ISAs Notice Accounts are:

  • 35 days – 1.05%
  • Three months – 1.10%
  • Six months – 1.15%
  • Nine months – 1.20%
  • One year – 1.25%
China/Hong Kong

Coming Soon: ‘Social Credit’ for Companies, Too (WSJ), Rated: AAA

A key target of China’s coming “social credit” system, which among Westerners usually triggers visions of “1984”-style monitoring of people, is actually misbehaving businesses.

Corporate America needs to prepare.

About 80% of information on the main data-sharing platform relates to companies rather than individuals, according to China consulting…

Hexindai Reports Unaudited First Quarter of Fiscal Year 2020 Financial Results (PR Newswire), Rated: A

First Quarter of Fiscal Year 2020 Operational Highlights

  • Total loan volume facilitated[1] was US$ 28.2 million (RMB192.3 million) during the first quarter of fiscal year 2020, a decrease of 93.5% from the first quarter of fiscal year 2019.
  • Gross billing amount (net of VAT)[2] was US$4.7 million during the first quarter of fiscal year 2020, a decrease of 90.7% from the first quarter of fiscal year 2019.
  • Gross billing ratio (net of VAT)[3] for credit loans was 16.7% during the first quarter of fiscal year 2020, an increase from 11.7% during the first quarter of fiscal year 2019.
  • Number of borrowers[4] was 18,546 during the first quarter of fiscal year 2020, a decrease of 36.0% from the first quarter of fiscal year 2019.
  • Number of investors[5] was 9,534 during the first quarter of fiscal year 2020, a decrease of 85.9% from the first quarter of fiscal year 2019.

First Quarter of Fiscal Year 2020 Unaudited Financial Highlights

  • Net revenue was US$4.9 million during the first quarter of fiscal year 2020, a decrease of 90.5% from the first quarter of fiscal year 2019.
  • Operating costs and expenses were US$12.6 million during the first quarter of fiscal year 2020, a decrease of 18.9% from the first quarter of fiscal year 2019.
  • Net loss was US$7.2 million during the first quarter of fiscal year 2020, compared to net income of US$29.7 million in first quarter of fiscal year 2019.
  • Basic loss per ordinary shares in the first quarter of fiscal year 2020 was US$0.15, compared to basic earnings per ordinary shares (“EPS”) of US$0.62 in first quarter of fiscal year 2019.
  • Diluted loss per ordinary shares in the first quarter of fiscal year 2020 was US$0.15, compared to diluted EPS of US$0.56 in first quarter of fiscal year 2019.
  • Adjusted net loss attributable to Hexindai Inc.’s shareholders (Non-GAAP) in the first quarter of fiscal year 2020 was US$7.0 million, compared to adjusted net income attributable to Hexindai Inc.’s shareholders (Non-GAAP) of US$29.9 million in the first quarter of fiscal year 2019.
  • Adjusted EBIT (Non-GAAP) in the first quarter of fiscal year 2020 was (US$5.8) million, compared to US$36.6 million in the first quarter of fiscal year 2019.

Zhang Yue, senior vice president at CreditEase, discusses the demand for credit in China, write downs in her portfolio, P2P lending, their wealth management business and their expansion plans.

Securing privacy concerns in FinTech in Hong Kong (Lexology), Rated: A

Hong Kong has built a strong environment for fostering innovation and financial technology or FinTech. With its large financial sector and its strategic role with Mainland China and gateway to the rest of Asia and the world, Hong Kong has the potential to take on an important role in being a leader in FinTech. In March 2019, for example, Hong Kong issued its first virtual banking licences, which will likely increase adoption of FinTech in the financial services sector.

Emerging technologies used in Fintech services and operations come in different forms, and include:

  • data analytics that support the operations of financial institutions (for example, credit scoring, loan processing);
  • peer-to-peer (P2P) financing (such as P2P lending and crowdfunding platforms);
  • distributed ledger technology, such as cryptocurrency, bitcoin transactions and smart contract applications, as well as blockchain services to help reduce fraud by keeping provenance data on the blockchain; and
  • financial investments, such as stock trading apps, robo-advisors and algorithmic trading and budgeting apps.
European Union

Binance Announces Phase Five of Crypto Lending Featuring Privacy Coins XMR, ZEC, and DASH (Crypto-Economy), Rated: AAA

Leading cryptocurrency exchange Binance has announced its launch of the fifth phase of its cryptocurrency lending product in which it customers subscribe to an allocation to lend other users their funds for interest rates as high as 15% Apr.

the 15% interest rate was only available to Binance’s native coin lenders in the first phase. On Tuesday, the exchange revealed three coins that will be included in the crypto lending product including only privacy-centric coins Monero [XMR], Zcash [ZEC] and Dash [DASH]. Their annualized interest rates will be a constant 3.5% but the lending period is only two weeks starting from this Friday September 20th through October 4th.

P2P Lender creditshelf to Acquire SME Finance Provider Valendo (Crowdfund Insider), Rated: A

creditshelf Aktiengesellschaft has signed a purchase agreement for the acquisition of all shares in Valendo – part of the finleap Fintech ecosystem.

According to a company release, the purchase price was in the “low seven-digit amount.” Payment will take place in two separate tranches. creditshelf has the option of settling both tranches in the course of two capital increases via a contribution in kind.

International

How MAS propelled Singapore to the top of the class (Euromoney), Rated: AAA

Today, Singapore sits proudly atop the Euromoney Country Risk (ECR) rankings. Based on ECR’s blend of financial and economic data, combined with the views of leading economists, no country in the world today has a stronger financial position.

When MAS said in July 2019 that it planned to issue five new digital banking licences, analysts soon spotted that three of them were wholesale licences, open to banks and non-banks alike.

Winners will be encouraged to lend, using digital means, to small and medium-sized enterprises and other non-retail segments – further evidence that corporate banking will be the next segment to feel the hot breath of disruption on its neck.

Source: Euromoney County Risk

Goldman Leads Trulioo’s $ 70M Raise To Expand Global Digital ID (PYMNTS), Rated: A

Trulioo, the global identity verification provider, has raised $70 million in new funding, eyeing growth in its core digital identification efforts, the company announced Tuesday (Sept. 17).

The company said in a release that the funding includes $60 million in a Series C round that was led by Goldman Sachs Growth Equity. Other participants included Citi VenturesSantander InnoVentures and existing investor American Express Ventures. The remaining $10 million came as unannounced follow-on financing from early investors, including BDC Capital and Blumberg Capital.

Equifax Continues Leadership In Alternative Data With Worldwide Urjanet Partnership (PR Newswire), Rated: A

Equifax Inc. (NYSE: EFX) and Urjanet today announced a global partnership that empowers consumers and businesses to share their payment data from thousands of utility, telecom and cable providers worldwide for a more complete picture of individual payment history, easier identity verification and the potential for better access to credit. This partnership builds on Equifax’s leadership in alternative data, using the Urjanet Utility Data Platform to incorporate consumer-permissioned data into the Equifax differentiated data approach.

5 Reasons Investors Should Consider Tokenized Assets (Benzinga), Rated: A

According to Deloitte, we shouldn’t view DLT as just a new type of “database ” but rather as a new way to organize the security value chain from issuance to custody. But what exactly can be transmitted through this chain?

Fractional ownership – take as much as you want

Digitizing shares makes them highly divisible, meaning that investors can buy very small percentages of tokenized assets.

So long, intermediaries! 

Security tokens have a simpler investment structure and lower fees.

On the way to maximum liquidity

Cherry on top

A security token is basically a digital signature connected with a smart contract responsible for facilitation and verification of ownership rights transactions.

India

Ribbit leads Series B funding in online investment platform Groww (VC Circle), Rated: AAA

Groww, an online investment platform that sells mutual fund products, has raised $21.4 million (Rs 152.5 crore at current exchange rate) in a Series B funding round led by Silicon Valley-based venture capital firm Ribbit Capital.

Groww said existing investors Sequoia India and Y Combinator also participated in the funding round.

RBI looking at how NBFCs, HFCs set their lending rates (livemint), Rated: AAA

The Reserve Bank of India (RBI) is studying how non-bank lenders and home financiers price their loans, close on the heels of directing commercial banks to link their loan rates to external benchmarks.

Source: livemint

RBI restricts access to credit data of consumers (Economic Times), Rated: A

The Reserve Bank of India has ordered commercial banks and non-banking lenders to stop providing unregulated entities access to consumer data held by credit bureaus, dealing a blow to scores of fintech startups that have based their business models on such information.

Source: India Times

RBI not in favour of ‘teaser’ loans, examines rate-setting mechanism of NBFCs, HFCs (CNBCTV18), Rated: B

The banking regulator is not in favour of hybrid loan products or ‘teaser loans’, a senior Reserve Bank of India (RBI) official today clarified. The remark gains significance in the light of State Bank of India chairman Rajnish Kumar’s recent comment that SBI would seek the regulator’s view on whether banks can introduce fixed-cum-floating rate products.

No dearth of demand on credit side, disbursed credit worth INR 5 billion: Flexiloans Co-founder (IBS Intelligence), Rated: A

FlexiLoans.com, an online lender for MSMEs in India, said that it has crossed a milestone number of disbursing over INR 5 billion of unsecured business loans across the country with its unique digital-only model. The Mumbai-based company, which has disbursed over 16000 loans across 1000 cities and towns in the country, says that there is no dearth of demand on the credit side. The company caters primarily to micro, small and medium-sized businesses.

How has the online lending market shaped up in the last few years?

Digital Lending market is currently at about USD 2 billion, up from about USD 1 billion in 2016. Significant traction and market niches discovered by various FinTech startups across the country have made this space very exciting, holistic and game-changing.

Online SME lender Cash Suvidha plans to raise upto $ 10 million (IBS Intelligence), Rated: B

The online lender for business and personal loans, Cash Suvidha, is planning to raise $5 million -$10 million equity funds in the next six months.

Asia

Terafunding Closes US$ 18M Series B Financing Round (FINSMES), Rated: AAA

Terafunding, a Seoul, South Korea-based Peer-to-Peer (P2P) lending platform, raised US$18M in Series B funding.

Backers included KB Investment, Hana Ventures, IBK Industrial Bank and Woomi Construction.

Julo raises $ 10M to expand its P2P lending platform (TechCrunch), Rated: A

Julo, a peer-to-peer lending platform in Indonesia, said on Wednesday it has extended its $5 million Series A raise to $15 million as it looks to scale its business in the key Southeast Asian market.

The $10 million Series A2 round for the Jakarta-headquartered startup was led by Quona Capital,  with Skystar, East Ventures,  Provident, Gobi Partners and Convergence participating.

Chinese P2P Firms Seeks Business in Vietnamese Market (W7 News), Rated: A

The declining demand for peer-to-peer (P2P) lending in China has prompted firms to find business elsewhere. LearnBonds report that Chinese P2P companies are eyeing Vietnam, which alarmed local lending companies.

MENA

Now Money offers alternative for Gulf’s unbanked expats (Financial Times), Rated: AAA

About 70 per cent of the population in the Middle East and north Africa do not have access to banking services, says Ian Dillon, co-founder of Now Money, a Dubai-based financial technology group.

The GCC recorded outbound remittances of $120bn in 2017, according to World Bank data. However, Gulf banks tend to exclude workers earning less than $1,400 a month, leaving most of them reliant on exchange houses to remit cash home.

Authors:

George Popescu
Allen Taylor

The post Thursday September 19 2019, Weekly News Digest appeared first on Lending Times.

Monday April 2 2018, Daily News Digest

PeerIQ

News Comments Today’s main news: Landbay raises 1.2M GBP on Seedrs. Yirendai issues quarterly earnings results. Betterment boosts human advice. Flender to raise 50M Euro. Cash Suvidha raisess $1M. Today’s main analysis: The VC and PE markets in Canada. Today’s thought-provoking articles: PeerIQ’s credit facility management suite. Is community bank SMB lending eroding? Africa’s big blockchain potential. United States Betterment’s rise […]

PeerIQ

News Comments

United States

United Kingdom

China

European Union

International

India

Other

News Summary

United States

Robo Pioneer Betterment Goes Upscale, Boosts Human Advice (ThinkAdvisor), Rated: AAA

Now with $13.5 billion in assets under management, the firm claims to be the largest independent online financial advisor. Indeed, its high-net-worth offering, or Prime Plan, has been embraced by investors with accounts ranging from $100,000 to many millions, according to Holeman.

Betterment, founded in 2008 as an automated digital-only advice platform, now has 340,000 customers, ranging from millennials to 85-year-olds, with an average age of 37 and an average balance just under $40,000.

How have your fees changed?

Before, we didn’t have the ability to talk with a human advisor; now we have certified financial planners. There are two levels of pricing: the basic digital plan [no minimum account size], which is 0.25% per year and our premium plan [$100,000 minimum account] for 0.4% per year to talk with a certified financial planner on an unlimited basis.

PeerIQ’s Credit Facility Management Suite (PeerIQ), Rated: AAA

US GDP growth for the 4th quarter was revised upwards from 2.5% to 2.9%, capping an impressive 2017. Consumer spending has driven the bulk of GDP growth and it will be relevant to see if this trend continues given the weak retail sales in Q1 and softening in some leading economic indicators. Core PCE, the Fed’s preferred inflation indicator rose 1.8% YoY in February. Personal spending rose 0.2% while incomes rose 0.4% MoM suggesting that Americans are saving more – a long-term positive for growth – although a short-term pressure on retail sales and consumer spending.

PeerIQ’s Credit Facility Management Suite

The Credit Facility Management Suite provides:

  • Dashboard overview of multiple facilities across various asset classes
  • Daily Covenant Calculation and Monitoring
  • Time Series Visualization and Projections
  • Automated Borrowing Base Report Generation
  • Collateral Cashflow Projections
  • Scenario Analysis
Source PeerIQ

 

Is community bank small business lending eroding? (Banking Exchange), Rated: AAA

Quarles, speaking March 26 at a HOPE Global Forum, told of recent meetings he had had with owners of very small businesses. He noted that their comments jibed with trends the central bank has seen. A key one is that small businesses still face gaps in available credit although more than two-thirds of those studied by the Fed request less than $100,000 and many less than $25,000.

Who’s lending to small businesses?

“Large banks’ share of small business lending has grown,” said Quarles, “especially among the smallest loans. This represents a change from 20 years ago when small businesses relied more on a relationship with local community banks for access to credit.”

Quarles shared figures for loans under $100,000. He said that small banks of less than $1 billion hold 19% of such loans—versus 60% two decades ago. By contrast, he said, that 60% share is now held by banks with $50 billion or more in assets.

Quarles next discussed nonbank alternative lenders. This included fintech specialists as well as large technology firms that extend credit to merchants who are part of their customer bases. (Quarles did not mention names, but examples of the former would include online lender Kabbage and the former would include Amazon, which grants credit to small firms that are part of its base.)

Tech ever-widening domain for community banks (Banking Exchange), Rated: A

“Anybody who doesn’t believe that is kidding themselves,” says James Beckwith, president and CEO at $972.8 million-assets Five Star Bank in Rocklin, Calif.

The attractiveness of tech-based marketplace lending, for example, is only going to increase, Beckwith says. Also, payments innovations, going on inside and outside banking, can’t be ignored by consumer or business bankers.

Marlin Secures $ 300,000,000 Forward Flow Agreement to Expand Equipment Financing for Small Businesses (GlobeNewswire), Rated: A

Marlin Business Services Corp. (NASDAQ:MRLN) a leading provider of credit products and services to small businesses, today announced that it has entered into a forward flow sale agreement with Varadero Capital, L.P., a leading alternative asset management firm, to sell up to $300,000,000 in equipment leases and loans to be originated by Marlin.

Technology jobs in the Chicago area are up, but that’s not the whole story (Chicago Tribune), Rated: A

Unlike at Enova, the overall number of technology jobs in the Chicago region grew at a modest pace last year, both at tech firms and in other industries.

Even before Chicago entered the cutthroat competition last fall to win Amazon’s second headquarters, dubbed HQ2, the city promoted the growth. Emanuel’s office issued at least eight news releases in 2017 on technology companies planning to hire. One of them named more than a dozen companies with hiring goals by the end of 2017.

Enova was on that list, with an aim to hire 75. Instead, it brought on 128 new people, raising its total employee count to 1,145.

And analytics was only the second-fastest-growing team at Enova last year.

 

LendIt Fintech USA 2018 Preview Show (Lend Academy), Rated: A

This year we have the LendIt Content Team on the show discussing all the different aspects of the event and how attendees can get the most out of their time at LendIt Fintech USA 2018.

 

United Kingdom

Landbay Returns to Seedrs & Quickly Raises £1.2 Million in Funding (Crowdfund Insider), Rated: AAA

UK-based peer-to-peer lender Landbay has launched another equity crowdfunding campaign on Seedrs and quickly secured more than £1.2 million in funding. This news comes less than a month after the online lending platform announced it hit its £100 million in lending milestone.

Deposit rates are a joke, so investors should consider peer-to-peer lending (The Times), Rated: A

Irish investors who want a regular return on their capital but are not happy to hand their money to the banks — where deposit rates are in the doldrums — have been exploring peer-to-peer (P2P) lending.

EasyMoney launches second IFISA with higher returns (Peer2Peer Finance), Rated: A

EASYMONEY, part of Sir Stelios Haji-Ioannou’s easy family of brands, has launched a second Innovative Finance ISA (IFISA) that offers higher returns than its first tax wrapper.

The recently-launched peer-to-peer lending platform said on Saturday that its ‘balanced’ IFISA allows individuals to invest in a broader range of property-backed loans, with a target interest rate of 7.28 per cent. Loans written for the ‘balanced’ IFISA are limited to 75% loan-to-value (LTV).

China

Yirendai (YRD) Issues Quarterly Earnings Results (The Lincolnian Online), Rated: AAA

Yirendai (NYSE:YRD) announced its earnings results on Wednesday, March 14th. The technology company reported $1.11 EPS for the quarter, topping the consensus estimate of $0.86 by $0.25, Briefing.comreports. Yirendai had a return on equity of 66.32% and a net margin of 24.69%. The company had revenue of $280.50 million for the quarter, compared to analysts’ expectations of $244.27 million.

China’s P2P lenders brace for renewed regulatory crackdown (Financial Times), Rated AAA

Thousands of online lenders could be facing extinction as China rolls out a new licensing framework, amid complaints about a lack of clarity on how the regime will work. The peer-to-peer, or P2P, lending sector is braced for a second regulatory crackdown as a new “record filing” system kicks off in April. But with the first batch of approvals expected by the end of the month, lenders say they are still in the dark on the filing process itself.

The peer-to-peer, or P2P, lending sector is braced for a second regulatory crackdown as a new “record filing” system kicks off in April. But with the first batch of approvals expected by the end of the month, lenders say they are still in the dark on the filing process itself.

 

European Union

Peer-to-peer lending start-up Flender to announce €50m debt round (The Irish Times), Rated: AAA

Dublin-headquartered fintech start-up Flender, whose backers include former EY Entrepreneur of the Year award winner Mark Roden, is set to announce a €50 million debt financing round to fund its expansion.

Having secured more than £500,000 (€569,000) to fund itself through crowdfunding, Flender announced plans to raise a £2 million (€2.2 million) funding round and £20 million (€22.7 million) in leveraged debt finance last August after receiving full authorisation from the UK financial regulator to operate in Britain.

Dutch Startup Aims To Boost Earnings Of P2P Services (Cointelegraph), Rated: A

Dutch Startup “BotBird” is launching a set of services that aims to bring together different aspects of the blockchain. While the services alone are well known amongst crypto investors the set combined might make a big difference in the scene altogether.

Lending

Crypto lending took a flight last year with lending programs popping up nearly every day. The promise was simple: Invest some bitcoin or Ethereum, get the counter value returned in alt coins minted by those lending programs and earn a certain percent of interest daily.

Escrow

Besides the fact that they actually focus on operating a sustainable service by offering a maximum of up to 10% monthly interest they also offer investment protection by 

International

Big banks on notice as tech groups ramp up pressure (Financial Times), Rated: AAA

Technology companies are set to take a big chunk of customers from banks, as they intensify their challenge to traditional lenders across a range of mass-market financial services, say industry executives and analysts. Carlo Messina, chief executive of Intesa Sanpaolo, has told the Financial Times that Italy’s biggest bank by market capitalisation expects to lose market share to digitally focused rivals in many mainstream areas such as payments.

Carlo Messina, chief executive of Intesa Sanpaolo, has told the Financial Times that Italy’s biggest bank by market capitalisation expects to lose market share to digitally focused rivals in many mainstream areas such as payments.

SALT: Leverage Your Blockchain Assets to Secure Cash Loans (SludgeFeed), Rated: A

One such project is SALT, a lending platform that was a built to facilitate the creation of lending agreements using blockchain assets as collateral. Through the SALT platform, individuals and businesses are able to access the largely illiquid value of their blockchain assets by putting these assets up as collateral in return for fiat loans. These lending agreements are secure, as their terms are automatically enforced through smart contracts and once a loan is repaid, crypto assets are returned to the borrower. Therefore, the SALT platform is designed for individuals and businesses that are needing immediate cash infusions but are unwilling or unable to liquidate their cryptocurrency holdings.

Source SludgeFeed

It’s important to note that there are no origination fees, closing costs, or prepayment penalties on any fixed rate term loans arranged through the SALT platform, which is very different than traditional lending systems.

Why ZPER is a Smart Investment Choice (NewsBTC), Rated: B

Against this backdrop, P2P financing has now added a new twist with a decentralized P2P finance platform, ZPER. The platform has its basis on blockchain technology and will transcend borders and currency limitations, generating innovation in the global P2P market.

 

India

Fintech Startup Cash Suvidha Raises $ 1 M in Pre-Series A Funding (Next Billion), Rated: AAA

Delhi-based online lending platform Cash Suvidha has raised $1 Mn in a Pre-Series A funding round from Initia Holdings; Vipin Agarwal, Partner in India Industrial Growth Fund and others.

The company will use the funding to increase the loan books of the company and to further strengthen its technological infrastructure.

Peer to Peer Lending Market is Anticipated Significant Growth due to Earliest Adopters of Latest Technologies (Digital Journal), Rated: A

The ‘Global and Chinese Peer to Peer Lending Industry, 2013-2023 Market Research Report’ is a professional and in-depth study on the current state of the global Peer to Peer Lending industry with a focus on the Chinese market. The report provides key statistics on the market status of the Peer to Peer Lending manufacturers and is a valuable source of guidance and direction for companies and individuals interested in the industry.

Firstly, the report provides a basic overview of the industry including its definition, applications and manufacturing technology. Then, the report explores the international and Chinese major industry players in detail. In this part, the report presents the company profile, product specifications, capacity, production value, and 2013-2018 market shares for each company.

Canada

THE VC AND PE MARKETS IN CANADA (AllAboutAlpha), Rated: AAA

The Canadian Venture Capital and Private Equity Association (CVCA) has posted what it calls an “overview” of the VC and PE Markets in that country in 2017. It reports growth in both of those markets, although growth at distinct velocities.

In 2016 there were 542 deals in the PE space. In 2017 there were 603. In 2016 the total valuation of those deals was $13.8 billion. In 2017 nearly twice that, $26.3 billion.

Looking at exits, 2016 was a slump and 2017 was a recovery. In 2016 there were only 33 exits with a total value of $0.6 billion. In 2017, though, there were 39 exits with a total valuation of $1.7 billion. A little arithmetic indicates that the average value of one of those 2017 exits was about $43 million. The average value of one of the 2016 exits was about $18 million.

More about Private Equity

Breaking down the PE highlights by city, the paper tells us that 15% of the action (89 deals totaling $6.7 billion) went to Montreal-based companies. Companies based in Calgary and Montérègie each received a 9% share. This meant 54 deals for Calgary and 53 for Montérègie.

Breaking down the highlights by sector, 19% of the PE deals closed in industry/manufacturing. The next largest share was in information and communications technology (ICT), a 16% share. The report tells us that both of these two top sectors “have been receiving a steadily increasing share of PE deal flow since 2013 when industrial and manufacturing captured only a 14% share” and ICT got 10%.

Download the full report here.

Africa

Blockchain’s big potential in Africa (Venture Beat), Rated: AAA

At the beginning of March, some of the brightest minds from the blockchain world joined representatives from the financial, legal, and global technology industries to discuss widespread blockchain adoption. But the event wasn’t held in fintech hub London, or startup mecca San Francisco. It was in Johannesburg, South Africa, at the fourth edition of the Blockchain Africa conference hosted at the Microsoft HQ.

Emerging blockchain hubs

While still in their early growth stages compared to the crypto hubs in central and eastern Europe and Switzerland, blockchain communities in Kenya, South Africa, Nigeria, and Sudan are growing steady.

BitHub Africa , based in Nairobi, is a blockchain accelerator for local startups founded in December 2015.

Tackling real problems

To date, blockchain adoption has been sporadic across Africa, but the emerging use cases are tackling real social, economic, and political problems affecting hundreds of millions of people every day:

Fighting corruption.

Combatting inflation.  In Zimbabwe, which has seen rapid inflation in recent years, Bitcoin sales have soared as locals rush to protect their savings before they devalue.

Authors:

George Popescu
Allen Taylor

Monday April 2 2018, Daily News Digest

PeerIQ

News Comments Today’s main news: Landbay raises 1.2M GBP on Seedrs. Yirendai issues quarterly earnings results. Betterment boosts human advice. Flender to raise 50M Euro. Cash Suvidha raisess $1M. Today’s main analysis: The VC and PE markets in Canada. Today’s thought-provoking articles: PeerIQ’s credit facility management suite. Is community bank SMB lending eroding? Africa’s big blockchain potential. United States Betterment’s rise […]

PeerIQ

News Comments

United States

United Kingdom

China

European Union

International

India

Other

News Summary

United States

Robo Pioneer Betterment Goes Upscale, Boosts Human Advice (ThinkAdvisor), Rated: AAA

Now with $13.5 billion in assets under management, the firm claims to be the largest independent online financial advisor. Indeed, its high-net-worth offering, or Prime Plan, has been embraced by investors with accounts ranging from $100,000 to many millions, according to Holeman.

Betterment, founded in 2008 as an automated digital-only advice platform, now has 340,000 customers, ranging from millennials to 85-year-olds, with an average age of 37 and an average balance just under $40,000.

How have your fees changed?

Before, we didn’t have the ability to talk with a human advisor; now we have certified financial planners. There are two levels of pricing: the basic digital plan [no minimum account size], which is 0.25% per year and our premium plan [$100,000 minimum account] for 0.4% per year to talk with a certified financial planner on an unlimited basis.

PeerIQ’s Credit Facility Management Suite (PeerIQ), Rated: AAA

US GDP growth for the 4th quarter was revised upwards from 2.5% to 2.9%, capping an impressive 2017. Consumer spending has driven the bulk of GDP growth and it will be relevant to see if this trend continues given the weak retail sales in Q1 and softening in some leading economic indicators. Core PCE, the Fed’s preferred inflation indicator rose 1.8% YoY in February. Personal spending rose 0.2% while incomes rose 0.4% MoM suggesting that Americans are saving more – a long-term positive for growth – although a short-term pressure on retail sales and consumer spending.

PeerIQ’s Credit Facility Management Suite

The Credit Facility Management Suite provides:

  • Dashboard overview of multiple facilities across various asset classes
  • Daily Covenant Calculation and Monitoring
  • Time Series Visualization and Projections
  • Automated Borrowing Base Report Generation
  • Collateral Cashflow Projections
  • Scenario Analysis
Source PeerIQ

 

Is community bank small business lending eroding? (Banking Exchange), Rated: AAA

Quarles, speaking March 26 at a HOPE Global Forum, told of recent meetings he had had with owners of very small businesses. He noted that their comments jibed with trends the central bank has seen. A key one is that small businesses still face gaps in available credit although more than two-thirds of those studied by the Fed request less than $100,000 and many less than $25,000.

Who’s lending to small businesses?

“Large banks’ share of small business lending has grown,” said Quarles, “especially among the smallest loans. This represents a change from 20 years ago when small businesses relied more on a relationship with local community banks for access to credit.”

Quarles shared figures for loans under $100,000. He said that small banks of less than $1 billion hold 19% of such loans—versus 60% two decades ago. By contrast, he said, that 60% share is now held by banks with $50 billion or more in assets.

Quarles next discussed nonbank alternative lenders. This included fintech specialists as well as large technology firms that extend credit to merchants who are part of their customer bases. (Quarles did not mention names, but examples of the former would include online lender Kabbage and the former would include Amazon, which grants credit to small firms that are part of its base.)

Tech ever-widening domain for community banks (Banking Exchange), Rated: A

“Anybody who doesn’t believe that is kidding themselves,” says James Beckwith, president and CEO at $972.8 million-assets Five Star Bank in Rocklin, Calif.

The attractiveness of tech-based marketplace lending, for example, is only going to increase, Beckwith says. Also, payments innovations, going on inside and outside banking, can’t be ignored by consumer or business bankers.

Marlin Secures $ 300,000,000 Forward Flow Agreement to Expand Equipment Financing for Small Businesses (GlobeNewswire), Rated: A

Marlin Business Services Corp. (NASDAQ:MRLN) a leading provider of credit products and services to small businesses, today announced that it has entered into a forward flow sale agreement with Varadero Capital, L.P., a leading alternative asset management firm, to sell up to $300,000,000 in equipment leases and loans to be originated by Marlin.

Technology jobs in the Chicago area are up, but that’s not the whole story (Chicago Tribune), Rated: A

Unlike at Enova, the overall number of technology jobs in the Chicago region grew at a modest pace last year, both at tech firms and in other industries.

Even before Chicago entered the cutthroat competition last fall to win Amazon’s second headquarters, dubbed HQ2, the city promoted the growth. Emanuel’s office issued at least eight news releases in 2017 on technology companies planning to hire. One of them named more than a dozen companies with hiring goals by the end of 2017.

Enova was on that list, with an aim to hire 75. Instead, it brought on 128 new people, raising its total employee count to 1,145.

And analytics was only the second-fastest-growing team at Enova last year.

 

LendIt Fintech USA 2018 Preview Show (Lend Academy), Rated: A

This year we have the LendIt Content Team on the show discussing all the different aspects of the event and how attendees can get the most out of their time at LendIt Fintech USA 2018.

 

United Kingdom

Landbay Returns to Seedrs & Quickly Raises £1.2 Million in Funding (Crowdfund Insider), Rated: AAA

UK-based peer-to-peer lender Landbay has launched another equity crowdfunding campaign on Seedrs and quickly secured more than £1.2 million in funding. This news comes less than a month after the online lending platform announced it hit its £100 million in lending milestone.

Deposit rates are a joke, so investors should consider peer-to-peer lending (The Times), Rated: A

Irish investors who want a regular return on their capital but are not happy to hand their money to the banks — where deposit rates are in the doldrums — have been exploring peer-to-peer (P2P) lending.

EasyMoney launches second IFISA with higher returns (Peer2Peer Finance), Rated: A

EASYMONEY, part of Sir Stelios Haji-Ioannou’s easy family of brands, has launched a second Innovative Finance ISA (IFISA) that offers higher returns than its first tax wrapper.

The recently-launched peer-to-peer lending platform said on Saturday that its ‘balanced’ IFISA allows individuals to invest in a broader range of property-backed loans, with a target interest rate of 7.28 per cent. Loans written for the ‘balanced’ IFISA are limited to 75% loan-to-value (LTV).

China

Yirendai (YRD) Issues Quarterly Earnings Results (The Lincolnian Online), Rated: AAA

Yirendai (NYSE:YRD) announced its earnings results on Wednesday, March 14th. The technology company reported $1.11 EPS for the quarter, topping the consensus estimate of $0.86 by $0.25, Briefing.comreports. Yirendai had a return on equity of 66.32% and a net margin of 24.69%. The company had revenue of $280.50 million for the quarter, compared to analysts’ expectations of $244.27 million.

China’s P2P lenders brace for renewed regulatory crackdown (Financial Times), Rated AAA

Thousands of online lenders could be facing extinction as China rolls out a new licensing framework, amid complaints about a lack of clarity on how the regime will work. The peer-to-peer, or P2P, lending sector is braced for a second regulatory crackdown as a new “record filing” system kicks off in April. But with the first batch of approvals expected by the end of the month, lenders say they are still in the dark on the filing process itself.

The peer-to-peer, or P2P, lending sector is braced for a second regulatory crackdown as a new “record filing” system kicks off in April. But with the first batch of approvals expected by the end of the month, lenders say they are still in the dark on the filing process itself.

 

European Union

Peer-to-peer lending start-up Flender to announce €50m debt round (The Irish Times), Rated: AAA

Dublin-headquartered fintech start-up Flender, whose backers include former EY Entrepreneur of the Year award winner Mark Roden, is set to announce a €50 million debt financing round to fund its expansion.

Having secured more than £500,000 (€569,000) to fund itself through crowdfunding, Flender announced plans to raise a £2 million (€2.2 million) funding round and £20 million (€22.7 million) in leveraged debt finance last August after receiving full authorisation from the UK financial regulator to operate in Britain.

Dutch Startup Aims To Boost Earnings Of P2P Services (Cointelegraph), Rated: A

Dutch Startup “BotBird” is launching a set of services that aims to bring together different aspects of the blockchain. While the services alone are well known amongst crypto investors the set combined might make a big difference in the scene altogether.

Lending

Crypto lending took a flight last year with lending programs popping up nearly every day. The promise was simple: Invest some bitcoin or Ethereum, get the counter value returned in alt coins minted by those lending programs and earn a certain percent of interest daily.

Escrow

Besides the fact that they actually focus on operating a sustainable service by offering a maximum of up to 10% monthly interest they also offer investment protection by 

International

Big banks on notice as tech groups ramp up pressure (Financial Times), Rated: AAA

Technology companies are set to take a big chunk of customers from banks, as they intensify their challenge to traditional lenders across a range of mass-market financial services, say industry executives and analysts. Carlo Messina, chief executive of Intesa Sanpaolo, has told the Financial Times that Italy’s biggest bank by market capitalisation expects to lose market share to digitally focused rivals in many mainstream areas such as payments.

Carlo Messina, chief executive of Intesa Sanpaolo, has told the Financial Times that Italy’s biggest bank by market capitalisation expects to lose market share to digitally focused rivals in many mainstream areas such as payments.

SALT: Leverage Your Blockchain Assets to Secure Cash Loans (SludgeFeed), Rated: A

One such project is SALT, a lending platform that was a built to facilitate the creation of lending agreements using blockchain assets as collateral. Through the SALT platform, individuals and businesses are able to access the largely illiquid value of their blockchain assets by putting these assets up as collateral in return for fiat loans. These lending agreements are secure, as their terms are automatically enforced through smart contracts and once a loan is repaid, crypto assets are returned to the borrower. Therefore, the SALT platform is designed for individuals and businesses that are needing immediate cash infusions but are unwilling or unable to liquidate their cryptocurrency holdings.

Source SludgeFeed

It’s important to note that there are no origination fees, closing costs, or prepayment penalties on any fixed rate term loans arranged through the SALT platform, which is very different than traditional lending systems.

Why ZPER is a Smart Investment Choice (NewsBTC), Rated: B

Against this backdrop, P2P financing has now added a new twist with a decentralized P2P finance platform, ZPER. The platform has its basis on blockchain technology and will transcend borders and currency limitations, generating innovation in the global P2P market.

 

India

Fintech Startup Cash Suvidha Raises $ 1 M in Pre-Series A Funding (Next Billion), Rated: AAA

Delhi-based online lending platform Cash Suvidha has raised $1 Mn in a Pre-Series A funding round from Initia Holdings; Vipin Agarwal, Partner in India Industrial Growth Fund and others.

The company will use the funding to increase the loan books of the company and to further strengthen its technological infrastructure.

Peer to Peer Lending Market is Anticipated Significant Growth due to Earliest Adopters of Latest Technologies (Digital Journal), Rated: A

The ‘Global and Chinese Peer to Peer Lending Industry, 2013-2023 Market Research Report’ is a professional and in-depth study on the current state of the global Peer to Peer Lending industry with a focus on the Chinese market. The report provides key statistics on the market status of the Peer to Peer Lending manufacturers and is a valuable source of guidance and direction for companies and individuals interested in the industry.

Firstly, the report provides a basic overview of the industry including its definition, applications and manufacturing technology. Then, the report explores the international and Chinese major industry players in detail. In this part, the report presents the company profile, product specifications, capacity, production value, and 2013-2018 market shares for each company.

Canada

THE VC AND PE MARKETS IN CANADA (AllAboutAlpha), Rated: AAA

The Canadian Venture Capital and Private Equity Association (CVCA) has posted what it calls an “overview” of the VC and PE Markets in that country in 2017. It reports growth in both of those markets, although growth at distinct velocities.

In 2016 there were 542 deals in the PE space. In 2017 there were 603. In 2016 the total valuation of those deals was $13.8 billion. In 2017 nearly twice that, $26.3 billion.

Looking at exits, 2016 was a slump and 2017 was a recovery. In 2016 there were only 33 exits with a total value of $0.6 billion. In 2017, though, there were 39 exits with a total valuation of $1.7 billion. A little arithmetic indicates that the average value of one of those 2017 exits was about $43 million. The average value of one of the 2016 exits was about $18 million.

More about Private Equity

Breaking down the PE highlights by city, the paper tells us that 15% of the action (89 deals totaling $6.7 billion) went to Montreal-based companies. Companies based in Calgary and Montérègie each received a 9% share. This meant 54 deals for Calgary and 53 for Montérègie.

Breaking down the highlights by sector, 19% of the PE deals closed in industry/manufacturing. The next largest share was in information and communications technology (ICT), a 16% share. The report tells us that both of these two top sectors “have been receiving a steadily increasing share of PE deal flow since 2013 when industrial and manufacturing captured only a 14% share” and ICT got 10%.

Download the full report here.

Africa

Blockchain’s big potential in Africa (Venture Beat), Rated: AAA

At the beginning of March, some of the brightest minds from the blockchain world joined representatives from the financial, legal, and global technology industries to discuss widespread blockchain adoption. But the event wasn’t held in fintech hub London, or startup mecca San Francisco. It was in Johannesburg, South Africa, at the fourth edition of the Blockchain Africa conference hosted at the Microsoft HQ.

Emerging blockchain hubs

While still in their early growth stages compared to the crypto hubs in central and eastern Europe and Switzerland, blockchain communities in Kenya, South Africa, Nigeria, and Sudan are growing steady.

BitHub Africa , based in Nairobi, is a blockchain accelerator for local startups founded in December 2015.

Tackling real problems

To date, blockchain adoption has been sporadic across Africa, but the emerging use cases are tackling real social, economic, and political problems affecting hundreds of millions of people every day:

Fighting corruption.

Combatting inflation.  In Zimbabwe, which has seen rapid inflation in recent years, Bitcoin sales have soared as locals rush to protect their savings before they devalue.

Authors:

George Popescu
Allen Taylor

Monday April 2 2018, Daily News Digest

PeerIQ

News Comments Today’s main news: Landbay raises 1.2M GBP on Seedrs. Yirendai issues quarterly earnings results. Betterment boosts human advice. Flender to raise 50M Euro. Cash Suvidha raisess $1M. Today’s main analysis: The VC and PE markets in Canada. Today’s thought-provoking articles: PeerIQ’s credit facility management suite. Is community bank SMB lending eroding? Africa’s big blockchain potential. United States Betterment’s rise […]

PeerIQ

News Comments

United States

United Kingdom

China

European Union

International

India

Other

News Summary

United States

Robo Pioneer Betterment Goes Upscale, Boosts Human Advice (ThinkAdvisor), Rated: AAA

Now with $13.5 billion in assets under management, the firm claims to be the largest independent online financial advisor. Indeed, its high-net-worth offering, or Prime Plan, has been embraced by investors with accounts ranging from $100,000 to many millions, according to Holeman.

Betterment, founded in 2008 as an automated digital-only advice platform, now has 340,000 customers, ranging from millennials to 85-year-olds, with an average age of 37 and an average balance just under $40,000.

How have your fees changed?

Before, we didn’t have the ability to talk with a human advisor; now we have certified financial planners. There are two levels of pricing: the basic digital plan [no minimum account size], which is 0.25% per year and our premium plan [$100,000 minimum account] for 0.4% per year to talk with a certified financial planner on an unlimited basis.

PeerIQ’s Credit Facility Management Suite (PeerIQ), Rated: AAA

US GDP growth for the 4th quarter was revised upwards from 2.5% to 2.9%, capping an impressive 2017. Consumer spending has driven the bulk of GDP growth and it will be relevant to see if this trend continues given the weak retail sales in Q1 and softening in some leading economic indicators. Core PCE, the Fed’s preferred inflation indicator rose 1.8% YoY in February. Personal spending rose 0.2% while incomes rose 0.4% MoM suggesting that Americans are saving more – a long-term positive for growth – although a short-term pressure on retail sales and consumer spending.

PeerIQ’s Credit Facility Management Suite

The Credit Facility Management Suite provides:

  • Dashboard overview of multiple facilities across various asset classes
  • Daily Covenant Calculation and Monitoring
  • Time Series Visualization and Projections
  • Automated Borrowing Base Report Generation
  • Collateral Cashflow Projections
  • Scenario Analysis
Source PeerIQ

 

Is community bank small business lending eroding? (Banking Exchange), Rated: AAA

Quarles, speaking March 26 at a HOPE Global Forum, told of recent meetings he had had with owners of very small businesses. He noted that their comments jibed with trends the central bank has seen. A key one is that small businesses still face gaps in available credit although more than two-thirds of those studied by the Fed request less than $100,000 and many less than $25,000.

Who’s lending to small businesses?

“Large banks’ share of small business lending has grown,” said Quarles, “especially among the smallest loans. This represents a change from 20 years ago when small businesses relied more on a relationship with local community banks for access to credit.”

Quarles shared figures for loans under $100,000. He said that small banks of less than $1 billion hold 19% of such loans—versus 60% two decades ago. By contrast, he said, that 60% share is now held by banks with $50 billion or more in assets.

Quarles next discussed nonbank alternative lenders. This included fintech specialists as well as large technology firms that extend credit to merchants who are part of their customer bases. (Quarles did not mention names, but examples of the former would include online lender Kabbage and the former would include Amazon, which grants credit to small firms that are part of its base.)

Tech ever-widening domain for community banks (Banking Exchange), Rated: A

“Anybody who doesn’t believe that is kidding themselves,” says James Beckwith, president and CEO at $972.8 million-assets Five Star Bank in Rocklin, Calif.

The attractiveness of tech-based marketplace lending, for example, is only going to increase, Beckwith says. Also, payments innovations, going on inside and outside banking, can’t be ignored by consumer or business bankers.

Marlin Secures $ 300,000,000 Forward Flow Agreement to Expand Equipment Financing for Small Businesses (GlobeNewswire), Rated: A

Marlin Business Services Corp. (NASDAQ:MRLN) a leading provider of credit products and services to small businesses, today announced that it has entered into a forward flow sale agreement with Varadero Capital, L.P., a leading alternative asset management firm, to sell up to $300,000,000 in equipment leases and loans to be originated by Marlin.

Technology jobs in the Chicago area are up, but that’s not the whole story (Chicago Tribune), Rated: A

Unlike at Enova, the overall number of technology jobs in the Chicago region grew at a modest pace last year, both at tech firms and in other industries.

Even before Chicago entered the cutthroat competition last fall to win Amazon’s second headquarters, dubbed HQ2, the city promoted the growth. Emanuel’s office issued at least eight news releases in 2017 on technology companies planning to hire. One of them named more than a dozen companies with hiring goals by the end of 2017.

Enova was on that list, with an aim to hire 75. Instead, it brought on 128 new people, raising its total employee count to 1,145.

And analytics was only the second-fastest-growing team at Enova last year.

 

LendIt Fintech USA 2018 Preview Show (Lend Academy), Rated: A

This year we have the LendIt Content Team on the show discussing all the different aspects of the event and how attendees can get the most out of their time at LendIt Fintech USA 2018.

 

United Kingdom

Landbay Returns to Seedrs & Quickly Raises £1.2 Million in Funding (Crowdfund Insider), Rated: AAA

UK-based peer-to-peer lender Landbay has launched another equity crowdfunding campaign on Seedrs and quickly secured more than £1.2 million in funding. This news comes less than a month after the online lending platform announced it hit its £100 million in lending milestone.

Deposit rates are a joke, so investors should consider peer-to-peer lending (The Times), Rated: A

Irish investors who want a regular return on their capital but are not happy to hand their money to the banks — where deposit rates are in the doldrums — have been exploring peer-to-peer (P2P) lending.

EasyMoney launches second IFISA with higher returns (Peer2Peer Finance), Rated: A

EASYMONEY, part of Sir Stelios Haji-Ioannou’s easy family of brands, has launched a second Innovative Finance ISA (IFISA) that offers higher returns than its first tax wrapper.

The recently-launched peer-to-peer lending platform said on Saturday that its ‘balanced’ IFISA allows individuals to invest in a broader range of property-backed loans, with a target interest rate of 7.28 per cent. Loans written for the ‘balanced’ IFISA are limited to 75% loan-to-value (LTV).

China

Yirendai (YRD) Issues Quarterly Earnings Results (The Lincolnian Online), Rated: AAA

Yirendai (NYSE:YRD) announced its earnings results on Wednesday, March 14th. The technology company reported $1.11 EPS for the quarter, topping the consensus estimate of $0.86 by $0.25, Briefing.comreports. Yirendai had a return on equity of 66.32% and a net margin of 24.69%. The company had revenue of $280.50 million for the quarter, compared to analysts’ expectations of $244.27 million.

China’s P2P lenders brace for renewed regulatory crackdown (Financial Times), Rated AAA

Thousands of online lenders could be facing extinction as China rolls out a new licensing framework, amid complaints about a lack of clarity on how the regime will work. The peer-to-peer, or P2P, lending sector is braced for a second regulatory crackdown as a new “record filing” system kicks off in April. But with the first batch of approvals expected by the end of the month, lenders say they are still in the dark on the filing process itself.

The peer-to-peer, or P2P, lending sector is braced for a second regulatory crackdown as a new “record filing” system kicks off in April. But with the first batch of approvals expected by the end of the month, lenders say they are still in the dark on the filing process itself.

 

European Union

Peer-to-peer lending start-up Flender to announce €50m debt round (The Irish Times), Rated: AAA

Dublin-headquartered fintech start-up Flender, whose backers include former EY Entrepreneur of the Year award winner Mark Roden, is set to announce a €50 million debt financing round to fund its expansion.

Having secured more than £500,000 (€569,000) to fund itself through crowdfunding, Flender announced plans to raise a £2 million (€2.2 million) funding round and £20 million (€22.7 million) in leveraged debt finance last August after receiving full authorisation from the UK financial regulator to operate in Britain.

Dutch Startup Aims To Boost Earnings Of P2P Services (Cointelegraph), Rated: A

Dutch Startup “BotBird” is launching a set of services that aims to bring together different aspects of the blockchain. While the services alone are well known amongst crypto investors the set combined might make a big difference in the scene altogether.

Lending

Crypto lending took a flight last year with lending programs popping up nearly every day. The promise was simple: Invest some bitcoin or Ethereum, get the counter value returned in alt coins minted by those lending programs and earn a certain percent of interest daily.

Escrow

Besides the fact that they actually focus on operating a sustainable service by offering a maximum of up to 10% monthly interest they also offer investment protection by 

International

Big banks on notice as tech groups ramp up pressure (Financial Times), Rated: AAA

Technology companies are set to take a big chunk of customers from banks, as they intensify their challenge to traditional lenders across a range of mass-market financial services, say industry executives and analysts. Carlo Messina, chief executive of Intesa Sanpaolo, has told the Financial Times that Italy’s biggest bank by market capitalisation expects to lose market share to digitally focused rivals in many mainstream areas such as payments.

Carlo Messina, chief executive of Intesa Sanpaolo, has told the Financial Times that Italy’s biggest bank by market capitalisation expects to lose market share to digitally focused rivals in many mainstream areas such as payments.

SALT: Leverage Your Blockchain Assets to Secure Cash Loans (SludgeFeed), Rated: A

One such project is SALT, a lending platform that was a built to facilitate the creation of lending agreements using blockchain assets as collateral. Through the SALT platform, individuals and businesses are able to access the largely illiquid value of their blockchain assets by putting these assets up as collateral in return for fiat loans. These lending agreements are secure, as their terms are automatically enforced through smart contracts and once a loan is repaid, crypto assets are returned to the borrower. Therefore, the SALT platform is designed for individuals and businesses that are needing immediate cash infusions but are unwilling or unable to liquidate their cryptocurrency holdings.

Source SludgeFeed

It’s important to note that there are no origination fees, closing costs, or prepayment penalties on any fixed rate term loans arranged through the SALT platform, which is very different than traditional lending systems.

Why ZPER is a Smart Investment Choice (NewsBTC), Rated: B

Against this backdrop, P2P financing has now added a new twist with a decentralized P2P finance platform, ZPER. The platform has its basis on blockchain technology and will transcend borders and currency limitations, generating innovation in the global P2P market.

 

India

Fintech Startup Cash Suvidha Raises $ 1 M in Pre-Series A Funding (Next Billion), Rated: AAA

Delhi-based online lending platform Cash Suvidha has raised $1 Mn in a Pre-Series A funding round from Initia Holdings; Vipin Agarwal, Partner in India Industrial Growth Fund and others.

The company will use the funding to increase the loan books of the company and to further strengthen its technological infrastructure.

Peer to Peer Lending Market is Anticipated Significant Growth due to Earliest Adopters of Latest Technologies (Digital Journal), Rated: A

The ‘Global and Chinese Peer to Peer Lending Industry, 2013-2023 Market Research Report’ is a professional and in-depth study on the current state of the global Peer to Peer Lending industry with a focus on the Chinese market. The report provides key statistics on the market status of the Peer to Peer Lending manufacturers and is a valuable source of guidance and direction for companies and individuals interested in the industry.

Firstly, the report provides a basic overview of the industry including its definition, applications and manufacturing technology. Then, the report explores the international and Chinese major industry players in detail. In this part, the report presents the company profile, product specifications, capacity, production value, and 2013-2018 market shares for each company.

Canada

THE VC AND PE MARKETS IN CANADA (AllAboutAlpha), Rated: AAA

The Canadian Venture Capital and Private Equity Association (CVCA) has posted what it calls an “overview” of the VC and PE Markets in that country in 2017. It reports growth in both of those markets, although growth at distinct velocities.

In 2016 there were 542 deals in the PE space. In 2017 there were 603. In 2016 the total valuation of those deals was $13.8 billion. In 2017 nearly twice that, $26.3 billion.

Looking at exits, 2016 was a slump and 2017 was a recovery. In 2016 there were only 33 exits with a total value of $0.6 billion. In 2017, though, there were 39 exits with a total valuation of $1.7 billion. A little arithmetic indicates that the average value of one of those 2017 exits was about $43 million. The average value of one of the 2016 exits was about $18 million.

More about Private Equity

Breaking down the PE highlights by city, the paper tells us that 15% of the action (89 deals totaling $6.7 billion) went to Montreal-based companies. Companies based in Calgary and Montérègie each received a 9% share. This meant 54 deals for Calgary and 53 for Montérègie.

Breaking down the highlights by sector, 19% of the PE deals closed in industry/manufacturing. The next largest share was in information and communications technology (ICT), a 16% share. The report tells us that both of these two top sectors “have been receiving a steadily increasing share of PE deal flow since 2013 when industrial and manufacturing captured only a 14% share” and ICT got 10%.

Download the full report here.

Africa

Blockchain’s big potential in Africa (Venture Beat), Rated: AAA

At the beginning of March, some of the brightest minds from the blockchain world joined representatives from the financial, legal, and global technology industries to discuss widespread blockchain adoption. But the event wasn’t held in fintech hub London, or startup mecca San Francisco. It was in Johannesburg, South Africa, at the fourth edition of the Blockchain Africa conference hosted at the Microsoft HQ.

Emerging blockchain hubs

While still in their early growth stages compared to the crypto hubs in central and eastern Europe and Switzerland, blockchain communities in Kenya, South Africa, Nigeria, and Sudan are growing steady.

BitHub Africa , based in Nairobi, is a blockchain accelerator for local startups founded in December 2015.

Tackling real problems

To date, blockchain adoption has been sporadic across Africa, but the emerging use cases are tackling real social, economic, and political problems affecting hundreds of millions of people every day:

Fighting corruption.

Combatting inflation.  In Zimbabwe, which has seen rapid inflation in recent years, Bitcoin sales have soared as locals rush to protect their savings before they devalue.

Authors:

George Popescu
Allen Taylor

Tuesday March 27 2018, Daily News Digest

bankruptcy

News Comments Today’s main news: Ron Suber joins MoneyLion board. Prosper reports full year results. Orca launches P2P investment platform. Santander, Ripple partner on money transfer app. Cash Suvidha raises $1M. China opens payment market to foreign companies. Today’s main analysis: The cost of bankruptcy. Today’s thought-provoking articles: LendingTree studies the cost of bankruptcy. Liwwa creates big impact in MENA. The lowdown […]

bankruptcy

News Comments

United States

United Kingdom

China

European Union

International

India

Other

News Summary

United States

Ron Suber Joins Board of Fintech MoneyLion (Crowdfund Insider), Rated: AAA

Ron Suber, President Emeritus of Prosper and a prominent Fintech advocate, has joined the board of directors of MoneyLion.

Prosper Reports Full Year Results (Business Wire), Rated: AAA

Prosper today reported full year results for 2017. Loan originations and transaction fee revenue were up 31% and 37% year-over-year to $2.9 billion and $130 million, respectively. Prosper also generated cash from operations for three consecutive quarters, starting in Q2 2017.

Source: Prosper

Summary of Key 2017 Financial Highlights:

  • Surpassed $11 billion in cumulative personal loan originations through the platform since inception
  • Increased loan originations 31% and transaction fee revenue 37% year-over-year
  • Net loss of $115 million included $89 million of non-cash charges related to warrants to purchase preferred stock that were issued to a consortium of investors and a third party in connection with a settlement agreement
  • Adjusted EBITDA(1) of $5 million increased $43 million year-over-year
  • Generated cash from operations for three consecutive quarters, starting in Q2 2017
  • Closed $50 million Series G funding, ending 2017 with approximately $100 million of liquidity

Citigroup to Again Be a Nationwide Bank, but in Digital Form (Wall Street Journal), Rated: AAA

After years of Citigroup Inc. shrinking its U.S. retail banking franchise to focus on affluent customers and a handful of big cities, the global bank is ready to become a national player once again.

This time, however, it doesn’t plan on gobbling up rivals or opening any new branches. Instead, Citigroup says it will use an expanded mobile app to fully serve new customers.

LendingTree Study: The Cost of Bankruptcy (PR Newswire), Rated: AAA

LendingTree today released the findings of its study on the cost of bankruptcy. The findings show that while a prior bankruptcy can make it more expensive to borrow, it’s certainly not impossible to qualify for credit. If borrowers wait to apply for new loans even just a few years after bankruptcy, they may find rates that aren’t too far off from what other borrowers are being offered.

Key findings:

  • Forty-three percent of people with a bankruptcy on their credit file have a credit score of 640 or higher within a year of the bankruptcy. Within two years of bankruptcy, 65 percent have a credit score above 640.
  • A typical $15,000 auto loan incurs an extra $2,171 in borrowing costs for those seeking offers less than a year after bankruptcy, but just $799 for those who wait at least two years after bankruptcy.
  • Borrowers who have a 3-year-old bankruptcy and apply for a mortgage see an offered APR that is 19 basis points higher than those without a bankruptcy. The higher the APR, the higher borrowing costs will be.
  • Mortgage borrowers with scores between 720 and 739 three years after bankruptcy were offered similar APRs to those without bankruptcy, indicating a strong credit score can counteract the effects of a prior bankruptcy.

With Marcus, Goldman Sachs takes on consumer banking (Bankrate), Rated: A

Despite becoming a bank holding company, Goldman’s business remained focused on corporations and the wealthy. That changed a few years ago as it began plotting new strategies, says Omer Ismail, chief commercial officer for Marcus. The Wall Street Journal recently published an in-depth account of the creation of Marcus, including juicy tidbits like conversations over lunch in the Hamptons.

Goldman decided to tackle the unsecured personal loan space first.

Marcus has found its particular angle in making its loans highly customizable. Rather than setting traditional loan terms, like three years or five years, it asks you how much you can afford to pay each month in addition to asking you how much you need to borrow. So, you might end up with a 31-month installment loan, which is not a conventional loan term.

Rod Buscher of Blinker (Lend Academy), Rated: A

In this podcast you will learn:

  • How Rod first made a name for himself in the car business.
  • The idea behind Blinker and why Rod decided to start the company.
  • How the buying and selling process works at Blinker.
  • The patents they have received to help identify any car in the U.S.
  • How they are able to make a safe environment for conducting a car transaction.
  • The percentage of car buyers at Blinker who opt for financing instead of paying cash.
  • How their financing process works.
  • The limits on the kinds of cars they finance.
  • The data they are using to make an underwriting decision.
  • The spectrum of the different credit profiles of their car buyers.
  • How they are getting the word out to find these buyers and sellers.
  • How they are funding their loans today.
  • Their move into auto refinancing and how they have built this business.
  • How they approach licensing in the states they operate.
  • The total number of transactions that have taken place on Blinker to date.
  • The other services they are providing to Blinker customers.
  • Rod’s vision for the future of Blinker.

Synthetic Identity Fraud: The Perfect Crime (Lendit), Rated: AAA

Synthetic identity fraud usually involves creating an entirely new identity composed of information with no ties to a known consumer. This identity is then used to apply for credit and services. Synthetic identities are one of the most difficult fraud threats institutions face today and their prevalence has exploded over the past several years. Synthetic identity fraud is arguably the perfect crime because there is no consumer victim.

Put yourself in the shoes of a fraudster. As you consider your many nefarious options for committing a crime and getting away with it, you decide that the best crime is one where there is no clear victim. Sure, robbing a bank using a synthetic identity victimizes the enterprise, its shareholders, its employees and taxes its customers. However, no one individual is intentionally, directly hurt. Therefore, the non-existent victim does not alert authorities and the fact that a crime has been committed is lost to history. There is a “credit loss” and the debtholder is impossible to locate. The debt is written off, or sold, and the fraud is perpetuated yet again. Like I said, the perfect crime.

Candex Raises $ 3.5M in Seed Funding (Finsmes), Rated: A

Candex, a San Francisco, CA-based fintech startup, raised $3.5m in seed funding.

Backers included Edenred Capital Partners, Partech Ventures, Advisors.Fund, Camp One Ventures, NFX, Tekton Ventures, Big Sur Ventures and fintech angel Mark Goines.

Hawaii is state with highest average debt-to-income ratio, study says (Pacific Business News), Rated: A

The average borrower in Hawaii spends 36.2 percent of their monthly paycheck on credit card, student loan, and housing payments, according to a study by Credible.com, making Hawaii the state with the highest average debt-to-income ratio.

According to the online lender marketplace, the average monthly credit card payment for a Hawaii resident is $238, the average monthly student loan payment is $385, and the average monthly housing payment is $1,091, for a total of $1,714.

With average annual income in Hawaii at $56,889, the state’s average debt-to-income ratio is 43 percent more than residents of Michigan, the state with the lowest debt-to-income ratio.

On average, Michigan residents in the dataset spent 25.3 percent of their monthly income on credit card, student loan and housing payments.

Nationwide, the study found the average American in the dataset paid $207 on credit card debt, $370 on student loans and $906 on housing each month, while taking home an average salary of $60,671.

Transparency Can Help Position a Fund for Growth (Lendit), Rated: A

When fund managers choose  experienced service providers, including custodians, auditors, accountants, attorneys and administrators, they can increase transparency in the fund, which can in turn promote investor confidence. Service providers can be much more than just an added expense;  they can be  valuable partners that can help position the fund for success.

United Kingdom

Orca Launches Investment Platform to Drive Mainstream Adoption of P2P Investing (Crowdfund Insider), Rated: AAA

Orca, an independent data, research and analysis provider targeting the the UK peer-to-peer (P2P) lending market, has launched its premier investment platform. The new platform will allow investors to easily diversify across multiple P2P lending platforms from a single P2P investment portfolio.

Orca seeks to provide their new service to the retail investor market.

Total cumulative lending is £13 billion since the asset class was created in 2005. Orca’s secondary service, Orca Analytics, has 2016 to 2017 growth at 18%, with £4 billion lent in 2017 alone. The estimated customer-base stands at approximately 200,000-250,000 retail investors.

The Orca Investment Platform Features include exposure to both consumer, business and property lenders. Investors may expect a return of 5% net of Orca’s cut which is a 0.65% fee.

UK digital bank that beat peers to an annual profit ‘will go into’ China — eventually (CNBC), Rated: A

OakNorth, a start-up bank based in London, recorded a pre-tax profit of £10.6 million ($15 million) in 2017 and is considered to be the first U.K. digital-orientated bank to reach such a milestone.

Khosla said his firm is already in “open conversations” with multiple countries about its global expansion plans, including the U.S., Canada, Spain, Italy, Germany, Singapore, South Africa and Australia. The company has already established offices in some of those countries, he added.

OakNorth is expanding abroad by licensing its technology platform, ACORN, to banks in other countries. The platform uses big data and machine learning to optimize credit for small-to-medium sized enterprises (SMEs).

OakNorth offers loans between £500 and £30 million to SMEs. It was granted a banking license by U.K. regulators in 2015.

‘No firm views’ on IPO

OakNorth is currently valued at $1.4 billion, which puts it in the ranks of the U.K.’s “unicorn” companies — firms valued at $1 billion or more.

It raised a total of £244 million last year in a combination of investments — the “largest U.K. fintech financing to date,” according CEO Khosla. Singaporean sovereign wealth fund GIC took a 10 percent equity stake in the firm.

Look to the Innovative Finance Isa for market-beating returns on your tax- free savings (City a.m.), Rated: A

IFISAs are also a way for investors to do something interesting with their savings. For example, Oaksmore has recently launched an Isa which allows investors to capitalise on historic renovation.

This particular IFISA, specialising in historical building renovation, offers a tax-free return of up to 7.5 per cent each year.

Another lender trying to do some- thing different is Folk2Folk, a peer-to- peer platform for rural and local businesses. It is offering an IFISA which gives lenders the opportunity to earn 6.5 per cent interest a year, while supporting British businesses within their local area.

China

China opens its payments market to foreign companies (The Paypers), Rated: AAA

China has decided to open up its payments market, allowing companies to apply for a payments license.

The People’s Bank of China said in a statement that foreign players who apply for payment licenses will receive the same treatment as local companies.

Applicants must set up local units, establish payment infrastructure — including disaster recovery systems — and store client information domestically, the central bank added.

European Union

Banco BNI Europa launches online account opening system through videoconference (Fintech Finance), Rated: AAA

Banco BNI Europa launched an online account opening process through videoconference. This new process also introduces an innovative system of documents signature with a qualified digital certificate and is available for Portuguese citizens who want to open an individual current account. The process is simple, fast and intuitive, without the usual bureaucracies associated with account opening.

This product is offered in partnership with DigitalSign, a Portuguese Certifying Entity specialized in the issuance of qualified digital certificates, registered in the National Security Office as an accredited entity. The partnership with Digital Sign allows, in addition to the online account opening, the issue of a digital certificate, with similar strength to a physical signature, which may be used by the client in the context of other contractual relations with the Bank.

International

Santander is set to launch an international money transfer app with Ripple (Business Insider), Rated: AAA

Santander is on track to launch an international money transfer app in partnership with fintech startup Ripple in the next few months, the bank’s UK CEO has confirmed.

Nathan Bostock told the International Fintech conference in London on Thursday: “This spring, if not one beats us to it, we will be the first large retail bank to carry out cross-border payments at scale with blockchain technology.”

 

Peoples Trust Company selects Finastra to fulfill end-to-end lending vision (PR Newswire), Rated: A

Peoples Trust Company of Saint Albans has selected Finastra to provide a single, end-to-end lending solution for commercial and consumer lending. Using Finastra’s Total Lending solution, which packages the power of the Fusion LaserPro, Fusion DecisionPro and Fusion CreditQuest products, the bank will be able to manage its lending process from origination through to booking and thus increase efficiency and customer service.

FintruX raises $ 25 million in their token sale to build P2P lending platform for small businesses and startups (Tech Startups), Rated: A

FintruXNetwork is a global P2P lending blockchain-based ecosystem,  powered by Ethereum. FintruX Network aims to connect borrowers, lenders, and rated service agencies. FintruX facilitates marketplace lending in a true peer-to-peer network to ease the cash-flow issues of small businesses and startups. The startup announced today it has successfully raised over 22,000 ETH  ($25 million) in token sale from contributors around the world. The proceeds of the sale will be used to build an Ethereum-based platform that will fundamentally enhance the P2P loan experience for small businesses and startups.

 

 

 

India

Lending platform Cash Suvidha raises $ 1 million in pre-series A (Financial Express), Rated: AAA

Delhi-based fintech startup, Cash Suvidha, has raised $1 million in its pre-series A round of investment from Initia Holdings Ltd., Vipin Agarwal, Partner in India Industrial Growth Fund and others. The company plans to use the newly secured funds to increase customer base and to further strengthen its technological infrastructure.

The company claims to receive 15,000 loan applications every month and disbursement of loans in another 2 working days. The company has raised a total of $5.2 million and claims to have disbursed over Rs 152 crore.

Further, Cash Suvidha has disbursed loans to over 35,000 borrowers with an average ticket size between Rs 20,000 – Rs 5,00,000.

SBI To Create Blockchain-Based Exchange For Recovering NPA’s (Inc42), Rated: A

Reportedly, India’s largest public sector bank, State Bank of India is looking to create a blockchain-based exchange for Non-Performing Assets (NPA’s).

To be launched in association with 30 banks, this platform will assist the banks in data-driven price discovery.

SBI is said to have assets over $460 Bn and offers services in areas such as retail, corporate banking, financing, and insurance. The Indian banks are said to have to battle with NPA’s worth $210 Bn of which $30 Bn resides with SBI alone.

Digital lending venture success secrets for the new-age CIOs (CIOL), Rated: AAA

Velocity

Broadly, there are three types of software systems that enterprises employ. These include:

a)Systems that help in running a business process

b)Those that help companies to grow their businesses

c)Systems that transform businesses

In the year 2013, China reported an eight-fold rise in the total number of borrowers that touched 1,49,300. The growth continued through 2014, with total borrowers reaching 630,000 by the year’s end.

Quality

Traditionally, lenders considered credit score as the key parameter in defining a borrower’s creditworthiness. In case of digital lending, a borrower’s risk profile is defined based on aspects such as Aadhaar for identification, salary slips for working professionals, and the applicant’s financial behavioral patterns determined based on information curated from online sources such as social media channels.

User Experience

Boston Consulting Group estimates that by 2020, 48% of India’s internet users will be rural and of that, 21% will be women.

Asia

Facing regulatory bar at home, QARASoft robo adviser heads overseas (Korean Herald), Rated: A

QARASoft’s now-defunct platform, called “QARA,” connected individual asset managers with funds pooled — or borrowed — from peer-to-peer investors, in part by making use of the venture firm’s artificial intelligence-powered robo adviser.

The “decentralized” platform collected some 100 retail investor loans in the first two weeks. But they were retrieved after the Financial Supervisory Service banned its operation, despite a patent earned the previous year for the pooling scheme of the fund and the platform’s three-year operation of its beta version.

The service will primarily target retail investors in overseas markets in the United States, the United Kingdom and Singapore, and the English version will be launched prior to a Korean version.

Continuous learning for SME executives (The Star Online), Rated: B

SMALL business executives who took part in the AmBank BizRACE gained a new perspective in managing their operations, allowing them to bring the business further.

The top 15 finalists in the programme recently completed two, out of four, executive development programmes at Menara AmBank.

Peoplender Sdn Bhd chief executive officer Kristine Ng, a participant in the programme, said she was inspired with a new structure for her business after the first day itself. Ng recalled one of the trainers talking about constraints that one would face in growing businesses – if it doesn’t fit the business model, then change must occur.

 

MENA

Creating big impact with a small help (Khaleej Times), Rated: AAA

According to the World Bank, 63 per cent of Mena SMEs do not have access to capital.

In Jordan, SMEs represent 97 per cent of companies and create 70 per cent of new jobs in the kingdom, according to Oxford Business Group, Jordan: Finding Financing for SMEs.

Liwwa is a peer-to-peer lending platform in the Mena region that provides SMEs with trade and asset financing. Liwwa’s target audience is divided into borrowers and investors, also referred to as lenders. To date, liwwa has maintained a solid portfolio and delivered annual returns of 10.6 per cent.

The liwwa index delivered 9.45 per cent over the last 12 months, which is attractive.

Liwwa has raised $5.55 million from investors and $6 million in debt to date. Their investors include Silicon Badia, Bank Al Etihad, DASH Ventures and Mena Venture Investments. Their debt partners include Bank Al Etihad, Capital Bank, Arab Bank and the Dutch Good Growth Fund.

Source Khaleej Times

Authors:

George Popescu
Allen Taylor

2018 Predictions for MPL, SMB Lending, and Other Alternatives

Lending Club

In just over a decade, alternative lending has evolved from a niche fintech play into a hundred billion dollar industry. 2017 was somewhat of a bumpy ride. Growing competition, shrinking bottom lines, stringent regulations, and traditional banks’ willingness to take on alt-lending using their financial muscle were the key trends that emerged last year. It […]

Lending Club

In just over a decade, alternative lending has evolved from a niche fintech play into a hundred billion dollar industry. 2017 was somewhat of a bumpy ride. Growing competition, shrinking bottom lines, stringent regulations, and traditional banks’ willingness to take on alt-lending using their financial muscle were the key trends that emerged last year. It is difficult to be sure what 2018 will bring, but here is what experts and pundits are predicting.

Marketplace Lending

Ron Suber (Founder and former president, Prosper & chairman of the board, Credible) believes the marketplace lending industry has finally grown up. Companies will focus more on cash flow, profitability, and EBITDA. He encouraged online lenders to look for a lower cost of capital if they want to compete with the like of Marcus. He is also predicting the entrance of big technology companies like Amazon, Apple, Facebook, and Google.

Peter Renton (Lend Academy) believes five of the top 25 banks will launch their own platforms. He also believes Congress will pass a Madden fix and the IRS will modernize with its own API. One startling prediction he makes that one of the top online lenders (Lending Club, SoFi, Prosper, OnDeck, or Avant) will be acquired, and he believes a major platform will be hit by a cyber attack. Like everyone else, he believes the tech giants will solidify their positions in alternative lending, and more interestingly, he says messaging apps will integrate with online lending platforms.

Krista Morgan (CEO, P2Binvestor) makes predictions for MPL sector:

  • Companies will shift their focus on business models and unit profitability as hiring and spending decrease.
  • Mergers and shutdowns will continue as equity investors remain absent. She thinks it will be a tough year.
  • Investors believe the market is set for a correction; therefore, they will be looking at short duration assets for deploying their capital. Platforms will have to shift their focus to product development.
  • 2018 will be the year of increased diversity.

Adam Stettner (Founder and CEO, Reliant Funding) predicts a year of instability. He also believes market variables will counterbalance themselves this year. The Fed is expected to increase interest rates, which will have a ripple effect in terms of rates for various types of loans. If unemployment levels remain low, it will lead to wage inflation. So the order of the day for alternative finance and small business funding companies will be adaptability, he says.

Additionally, Stettner sees a year of increased fraud, and companies will have to invest in identification tools and fraud detection techniques.

Two more predictions he points to are increased consolidation as companies overextend themselves and more disruption from big business names entering the space.

The Motley Fool is predicting a Lending Club stock price turnaround.

Juan Tavares (LendingPoint) predicts balance sheet lenders will take over, there will be more collaboration, and payments and credit will intersect more.

Small Business Lending

Trevor Dryer (Co-founder and CEO, Mirador) made predictions on small business lending:

  • Banks will continue to increase small business lending and alternative lenders will struggle.
  • Crowdfunding got a boost last year when Title III of The Jumpstart Our Business Startups Act (JOBS Act) was implemented, opening the gates for crowdfunding. Dryer believes this sector will thrive in 2018.
  • Alternative lending has removed physical barriers that makes the lending process faster and more convenient. Alternative lending will continue to be more inclusive and encourage more people to start businesses.
  • Legislative barriers will continue to fall.
  • Alternative lenders will focus on experience and relationship building. Companies able to streamline and automate the application processes will thrive.

Alternative Lending in India

Rajesh Gupta (Founder and CEO, Cash Suvidha) made the following predictions for the Indian alternative lending market.

  • A significant increase in alternative lending market share.
  • Favorable regulations, cash benefits, ease of usage, and increased internet and smartphone penetration.
  • Investors and venture capitalists will remain optimistic about the Indian alternative lending industry since it is the second most funded segment in Indian fintech.

“2018 will witness a transformation in the Indian financial landscape, all thanks to alternative lending,” he writes.

Traditional Financial Services and Alternative Investing

Kevin McPartland (Greenwich Associates) says 2018 will be the year of digital. He believes product-agnostic investing will be huge, and passive investing will gain on active investing. 2018 will also be the year that alternative data goes mainstream, he believes while data will be more important than trading. He also believes wealth management will “come out of retirement” and, finally, a ton of innovation in the financial markets as banks focus on crypto.

Chris Skinner (The Finanser Blog) writes a lot about banking’s reaction to alternative lending. He believes 2018 will be the year of artificial intelligence for banks and that banks will continue to drive digital technology deeper into their core systems. Not surprisingly, he also predicts that banks will develop more proof-of-concept operations for distributed ledger technology. Finally, he predicts the banks will develop an Enterprise Data Architecture this year to clean up their fragmented systems.

Alexander Prokhorov (FinSight Ventures) made some general predictions for fintech that apply just as well to alternative lending:

  • Software will converge with financial products in the U.S. and Europe
  • Insurtech will be more prominent
  • Artificial intelligence will transform financial services
  • There will be a lot of innovation in emerging economies such as Africa, Latin America, and Asia
  • Wealth management will pick up speed
  • Crypo assets and blockchain will take center stage for retail investing

Mitek believes 2018 will be the year of the cyber criminal and predicts there will be 150 million attempts to set up fraud accounts this year.

Don Steinbrugge, CFA (Founder and CEO, Agecroft Partners) is predicting a banner year for the hedge fund industry. He believes hedge fund assets will reach an all-time high for the 10th straight year. He also believes there will be an increase in hedge funds shutting down. And there will be an increase in cryptocurrency funds. Strategies that will gain assets, he believes, include:

  • Asia long/short equity
  • Reinsurance
  • Those that blur the lines between private equity and hedge funds

The Lending-Times Prediction

Allen Taylor (Editor, Lending-Times) believes more U.S. platforms will open the doors to non-accredited investors. Blockchain will feature more prominently in alternative lending with more platforms focused on crypto-lending including a prominent alternative lender adding cryptocurrency to its list of core services. He also believes increased specialization will lead to platforms targeting specific industries, regions/states, and other narrow target markets.

Conclusion

2018 will surely see the alternative lending industry enter a consolidation phase to withstand the changes in market dynamics, and companies best able to cope with these headwinds would emerge bigger and stronger.

Authors:

Written by Heena Dhir and Allen Taylor.

Allen Taylor

Monday December 18 2017, Daily News Digest

Chinese share prices

News Comments Today’s main news: Investors are losing big on Chinese IPOs in the U.S. Funding Circle’s projected returns. Ablrate funds 30M GBP, launches portfolio loans product. Cash Suvidha raises $2.7M in debt funding. SimplyFi challenges banks in Russia. Goldman Sachs secures majority stake in Financeit. Today’s main analysis: Sharpe ratios for ex-ante forecasts of credit models. Today’s thought-provoking articles: What makes […]

Chinese share prices

News Comments

United States

United Kingdom

China

European Union

International

India

Asia

MENA

Canada

News Summary

United States

Chinese IPOs in the U.S. Are Saddling Investors With Big Losses (WSJ), Rated: AAA

Sixteen companies from China have debuted on the New York Stock Exchange or Nasdaq so far in 2017, making this year one of the busiest of the past decade for Chinese IPOs in the U.S., according to data provider Dealogic. Ten of the newly issued stocks this year are trading below their IPO prices, with some plunging within weeks of listing.

The worst performer is Qudian Inc., a three-year-old online lender whose shares have slumped 46% through Friday since the company raised $900 million in October in one of the larger U.S. IPOs this year.

Chinese companies have raised a total of $3.7 billion by listing their shares in the U.S. in 2017, representing about 8% of the total U.S. IPO funds raised, according to Dealogic. Firms from China broadly have also powered a global surge in IPOs this year, driven in part by investors who bought into expectations of robust growth in China’s economy.

Source: The Wall Street Journal

During a period of big stock market gains, shares of all companies that raised at least $50 million in U.S. IPO proceeds this year are up an average of 18.3% since their listings through Friday, according to Dealogic. But Chinese companies in this category have fallen by an average 5.7% through Friday, with more than half of them down by double-digit percentage terms.

Source: The Wall Street Journal

Introducing Sharpe Ratios (PeerIQ), Rated: AAA

Over the last few months, we have received investor inquiry on how to incorporate both expectations and uncertainty in expectations to manage risk. The motivation is two-fold—expected returns are an insufficient statistic to drive investment decision making. For example, an investment with a 5% expected return but a higher range of outcomes may be less attractive than an investment with an expectation of 4% that has a tighter distribution of outcomes.

The Sharpe ratio is designed to measure riskiness while controlling for risk-free rates and volatility. The ratio, introduced by Nobel Laureate Bill Sharpe, measure return per unit of total risk taken above the risk-free rate.

[ Quant Note: The Sharpe ratio is typically used for assessing performance on liquid traded instruments (such as equities), and should not be used to evaluate ex-postperformance for illiquid collateral – including whole loans. However, the Sharpe ratiocan be a useful tool to analyze ex-ante forecasts are drawn from a credit model that generates independent and identically distributed draws (such as a monte carloprocess drawing from a roll-rate model). ]

Source: PeerIQ

What is a good FICO score? (The Mortgage Reports), Rated: AAA

Credit scores do not reflect income – it’s entirely common for people with big earnings to have weak credit, and for people with small wages to have great credit.

Source: The Mortgage Reports

Credit scores may not include all of your bills. For example, if you rent a home from a private owner, he or she will probably not report your payment history to credit bureaus.

Incorrect or out-of-date information on your credit report can reduce your score. And that can cost you when you shop for a mortgage. Fannie Mae’s Loan Level Pricing Adjustment Matrix, pictured below, shows just how much extra a lower score can cost you.

Source: The Mortgage Reports

According to Ellie Mae, the typical closed mortgage in October had a credit score of 724. However, you can get mortgage financing with lower scores.

HUD, the Department of Housing and Urban Development, allows FHA borrowers to purchase with 3.5 percent down with a credit score of 580 or better. Those with credit scores between 500 and 580 must put at least 10 percent down.

How technology giants are using their reach and digital prowess to take on traditional banks (Business Insider), Rated: AAA

As headlines like “Amazon Is Secretly Becoming a Bank” and “Google Wants to Be a Bank Now” increasingly crop up in the news, tech giants are coming into the spotlight as the next potential payments disruptors.

Google, Apple, Facebook, Amazon, and Microsoft, collectively known as GAFAM, are already active investors in the payments industry, and they’re slowly encroaching on legacy providers’ core offerings. Each of these five companies has introduced features and offerings that have the potential to disrupt specific parts of the banking system. And we expect a plethora of additional offerings to hit the market as these companies look to build out their ecosystems.

Source: Business Insider

Lendio Announces New Franchise in Detroit (Crowdfund Insider), Rated: A

Lendio, an online lending marketplace for small business loans, announced on Thursday the opening of its new franchise in the Detroit Metro area.

Walmart employees should use the new early pay policy as a last resort (Yahoo! Finance), Rated: A

Walmart, the largest private employer in the U.S., will begin allowing its 1.44 million employees to access their paychecks before payday.

After two years of talks with Even, a fintech startup that helps users budget by accessing upcoming pay early, Walmart (WMT) is rolling out the app to its entire workforce. In conjunction with PayActiv, Even lets employees take up to 50% of the amount they have earned up to that point, prior to the standard 2-week pay period. Individuals can do this interest-free up to eight times annually.

“I think this is a great perk for employees to have, provided they are able to use it responsibly.  The key is to treat it the same as an interest-bearing payday loan,” said Corey Sunstrom, director at Hobart Financial Planning and founder of thepocketadvisor.com.

Bitcoin surge spawns startup lenders willing to accept crypto-collateral (American Banker), Rated: A

The woes of an early bitcoin investor. Until recently, people who paid virtually nothing for the virtual currency and watched it soar had only one way to enjoy their new wealth — sell. And many weren’t ready.

Lenders on the fringe of the financial industry are now pitching a solution: loans using a digital hoard as collateral.

While banks hang back, startups with names like Salt Lending, Nebeus, CoinLoan and EthLend are diving into the breach. Some lend — or plan to lend — directly, while others help borrowers get financing from third parties. Terms can be onerous compared with traditional loans. But the market is potentially huge.

Human vs. machine: The rise of the bionic advisor (FinancialPlanning), Rated: A

As technological innovations continue to revamp the way business is conducted in the industry, the human element of financial advice is more important than ever. Clients now demand an experience as convenient and advanced as the robo advice platforms but will also look to advisors who add value beyond the numbers and calculations, create a deep connection, and consider both financial and non-financial assets.

But one important question remains: Is the middleman between investors and markets still important?

JPMorgan Chase, Barclays join IBM quantum computing network (American Banker), Rated: A

Two major banks have become charter members of a quantum computing network established by IBM, another sign of how far financial services companies are going to make themselves more competitive and to steel themselves against security threats.

PMorgan is looking at using IBM’s quantum computing systems for trading, portfolio optimization, asset pricing and risk analysis, among other things. Barclays is just beginning to investigate potential uses for the financial industry.

New frontiers of investing (Centre Daily Times), Rated: A

Another investment practice that is gaining popularity — and has had a longer history than cryptocurrencies — is peer-to-peer lending. Depending on the credit worthiness of the person borrowing, the interest earned by a lender can vary from 5 to almost 20 percent.

Notice how in both cryptocurrency and peer-to-peer lending, an attempt is made to remove the central entity that acts as the source of trust in the transaction. The central entity is then replaced by a large number of people. While a great concept, I’m not convinced that the central entity — which benefits most from the transaction — is actually removed. What I think is taking place is actually an attempt to reshuffle power.

In the case of peer-to-peer lending, the central power may not technically be a bank, but for all intents and purposes performs the same functions as the bank. The facilitator’s duties may have changed and the process may be simpler, but there’s still someone charging a fee to set the loan parameters.

Private Equity, Hedge Funds Are Supercharging Payday Lending (ValueWalk), Rated: A

Private equity moguls have invested heavily in the payday and installment lending, putting additional resources, tangible and intangible, at the disposal of these often-predatory businesses, according to a new report by Americans for Financial Reform and the Private Equity Stakeholder Project.

The report, available here, documents 23 payday and installment companies in which private equity firms have invested, sometimes to acquire ownership stakes, other times to fund actual lending.

Using Bitcoin as Loan Collateral (BTCManager), Rated: A

Bitcoin’s current market value, with the price around the $18,300 level, is nearly $315 billion. And, just like in “real” currencies, nearly 40 percent of that wealth is held by around 1,000 users.

Someone looking to take $100,000 in cash would be giving the lender $200,000 in bitcoin as collateral, with about a 12 to 20 percent interest rate.

 Coinbase is now the No. 1 iPhone app in the U.S. (recode), Rated: A

The crazy spike in the value of a bitcoin — from around $1,000 at the beginning of this year to more than $18,000 today, according to CoinMarketCap — has made Coinbase, an app that lets you buy, sell and store bitcoin, a winner. As of this afternoon, it is now the most-downloaded iPhone app in Apple’s U.S. app store.

Source: recode

 

Firms clamp down on brokers taking clients when they leave (StarTribune), Rated: A

Recently, Morgan Stanley and UBS Financial Services pulled out of a private “cease fire” agreement among brokerage houses that has made it easy for brokers to move from firm to firm. By withdrawing, the two are signaling to brokers considering a move at the two firms that they and their new employer face the threat of lawsuits if they take client contact information with them, a practice allowed under the pact.

The defections by two of the largest players, employing more than 18,000 brokers between them, raises the prospect that the industry may return to the era when the client-adviser relationship was treated as the property of the firm.

Marlette Funding Appoints Sabrina Basht Chief Strategy Officer for Best Egg (Marlette Funding), Rated: B

Marlette Funding, LLC, the parent company of , today announced the promotion of Sabrina Basht to the position of chief strategy officer (CSO), effective immediately. In this role, Basht will continue to report to Josh Tonderys, President.

As part of her new role, Sabrina will also lead the company’s communication efforts for Marlette Funding and Best Egg.

How Much Would it Cost to Travel to Every Star Wars Filming Location? (OppLoans), Rated: B

The cost of traveling to the filming locations for every Star Wars movie prior to The Last Jedi (excluding studio lots) would be just a hair over $10,900.

Source: OppLoans

 

Modo Announces Brian Billingsley, Former CEO of Klarna North America, to Join Team (PR Newswire), Rated: B

Modo, the company that creates interoperability for payments, today announced Brian Billingsley, Former CEO of Klarna North America, as the latest to join their team. Billingsley has an extensive payments background that will play an integral role in continuing the expansion of Modo’s capabilities for their clients. Billingsley will be joining as Modo’s Chief Revenue Officer.

BFS Capital Names Former BankUnited Executive, Mary Harris, as Chief Marketing Officer (BusinessWire), Rated: B

BFS Capital, a leading small business financing platform, announced today the hiring of Mary Harris as its Chief Marketing Officer. Harris formerly led marketing and public relations for BankUnited, a leading U.S. business bank headquartered in Miami-Lakes, Florida. Harris will join the BFS Capital senior leadership team and report to the company’s Chief Executive Officer, Michael Marrache.

Harris brings over 25 years of experience to BFS Capital across financial services and retail sectors. For BankUnited, she helped to rebrand and position the company as a national commercial bank now listed as one of Forbes magazine’s “Best Banks in America.” At BFS Capital, Harris will be responsible for marketing, branding, advertising and public relations strategies as well as customer acquisition and loyalty.

MPOWER Financing Named “Growth Tech Company of the Year” (PR Newswire), Rated: B

Continuing its impressive momentum as a market-leading provider of student loans, MPOWER Financing has been named Growth Tech Company of the Year by Technical.ly DC.

United Kingdom

Funding Circle refines projected returns calculations (P2P Finance News), Rated: AAA

FUNDING Circle has changed the way its projected returns are calculated, so that the data applies to a larger proportion of its investors.

Funding Circle said on Friday that its projections will now show the minimum rate that 65 per cent of investors could achieve.

The target rate on the Balanced return portfolio is now 7.2 per cent rather than 7.5 per cent, while the Conservative product remains at 4.8 per cent.

Assetz Capital Announces New Website & Refresh Branding While Prepping For Upcoming ISA Debut (Crowdfund Insider), Rated: AAA

On Thursday, online lending platform Assetz Capital announced the launch of its new website and “refreshed” brand just ahead of its upcoming Assetz Capital ISA.

Ablrate Launches Portfolio Loans Product After Topping £30 Million in Total Funding & Securing £3 Million in IFISA Funds (Crowdfund Insider), Rated: AAA

Asset-backed lending platform Ablrate announced on Thursday it launching a new range of portfolio loan lending products. This news comes just after the platform topped £30 million in total funding and achieved £3 million in IFISA funds.

Squirrel Announces Partnership With HM Government & Nesta While Crowdcube Campaign Nears £450,000 (Crowdcube Insider), Rated: A

Squirrel, a personal finance app designed to help users have more control over their money, announced on Friday it has formed a partnership with the HM Government and Nesta.

SBDA Group Closes Series A Investment Round (Finovate), Rated: A

Banking personalization company SBDA Group has landed a Series A investment today. FinSight Ventures and Digital Space Ventures contributed to the round, the amount of which was undisclosed. This marks the company’s first ever VC funding round.

Alternative Finance Boom Continues With 43% Growth (Forbes), Rated: A

The UK’s booming alternative finance market shows little sign of slowing down, with the value of funding for small and medium-size enterprises growing by well over a third last year, new research shows. Data from the Cambridge Centre for Alternative Finance (CCAF) suggests new funding models ranging from loan- and equity-based crowdfunding to invoice finance offer an increasingly important alternative to conventional SME funding such as bank support.

Overall, the UK’s alternative finance market grew by 43 per cent in 2016, to £4.6bn from £3.2bn in 2015, the CCAF said. The growth means that over the six years to the end of 2016, alternative finance has provided an additional £11bn of funding.

The research found that peer-to-peer business lending was the single largest market segment in 2016, growing by 36 per cent last year to reach £1.23bn, followed by peer-to-peer consumer lending at £1.17bn (up 47 per cent), and peer-to-peer property lending at £1.15bn (up 88 per cent).

Fintech startup Loot raises £2.2 million for its digital banking app (Tech.eu), Rated: A

UK fintech startup Loot has raised £2.2 million in funding from Portag3, the VC division of Power Corporation, and Speedinvest.

Nottingham fintech firm secures Open Banking investment (The Business Deck), Rated: A

Handle, based at the Accelerate Places tech hub, enables businesses to take control of their digital profile all the way from managing their credit score to optimising their online presence and presenting a professional face to the world.

Now, it’s been selected by the UK’s innovation foundation, Nesta, to help drive a revolution in small business banking opened up by the arrival in 2018 of the Open Banking initiative.

It’s been given £100,000 by Nesta to help it further develop its dashboard into a single app which makes it easier for small business owners to keep control of their cash position, grow top line sales, compare and save money on their key expenses and keep their credit score finance-friendly.

Rebuilding Trust In Money (MinuteHack), Rated: A

The credit crunch led to widespread job losses, loss of disposable income and a drought in available capital, all exacerbated by what is generally agreed upon as long-term irresponsible lending practices from some financial institutions.

In my opinion, we’re heading for even further mistrust with the trouble currently brewing in the peer-to-peer lending sector. Yield hungry investors are drifting into peer-to-peer (P2P) investing via the new Innovative Finance ISA, without being fully aware of the risks – the FCA have already identified this as an issue.

So how can the financial services industry, and the institutions and professionals who work within it, start to rebuild the bridges that have been burnt over the last 10 years and re-establish a trusting relationship with consumers?

Protect yourself against rising rates (The Times), Rated: B

A report by Lendy, the peer-to-peer lending platform, found a substantial drop in “bad debt” with £72 million worth of residential loans written off by banks and building societies in the 12 months to September, compared with £348 million in the previous year.

China

China Futures (Seeking Alpha), Rated: AAA

And of course, over 1.4 billion people live there, the most populous nation on the planet. It imports and exports over $3.7 trillion of products every year. China’s growth over the past 30 years has been truly astounding, a miracle of modern development.

Total debt – government, corporate, and household – has grown in recent years to over 200% of the Chinese economy.

China Total Debt to GDP. Source: Bloomberg

Despite Being World’s Largest Fund, Ant Financial’s Yu’E Bao Is Risky (China Money Network), Rated: A

Technology is both revolutionizing and super-sizing China’s financial services sector. But it’s not making it any safer, according to a report by Fitch Ratings that compares the world’s two largest money management funds, Ant Financial’s Yu’e Bao and JP Morgan U.S. Government Money Market Fund.

The report notes that in just four years, Yu’e Bao has ridden the fintech wave to become the world’s largest money market fund with RMB1.56 trillion (US$233 billion) in assets under management. Since its 2013 launch, Yu’E Bao has been growing at a CAGR of 125%, thanks to technological development and its links with Alibaba Group Holding Limited’s online payment platform, Alipay.

A Bonanza Awaits China’s Surviving Fintech Lenders (Bloomberg), Rated: A

China’s whac-a-mole approach to risk — hit it everywhere it pops up — is set to hand control of the surging $121 billion technology-driven lending market to a small group of leaders such as Lufax Holding and the finance affiliate of Jack Ma’s Alibaba Group Holding Ltd.

The survivors are in for a bonanza in coming years: Macquarie estimates credit extended by China’s fintech firms will jump more than seven-fold by 2022 to 6.2 trillion yuan ($940 billion) to pay for things like luxury and household goods or training and education. About half that market is micro-lending — typically small, short-term loans with high interest rates, Macquarie says.

WeiyangX Fintech Review (Crowdfund Insider), Rated: A

Zhima Credit, the credit services and rating agencies of Ant Financial, used to offer two types of credit report inquiries. The one in collaboration with SHULIDATA.com offers users access to individual credit reports issued by the PBoC and the other with CreditKarma, presents the channel for oversea credit inquiries (at present only available to users’ credit records in the U.S.).

On December 8th, a task force specially set up by China Banking Regulatory Commission (CBRC) released a rectification document towards micro lending, signaling a period of tightening oversight of the unregulated lending activities and related financial risks. This round of rectification will focus on 11 key areas: Source: Sina

  1. Tighter management of micro lending approval authority;
  2. Re-examination of micro lending enterprise qualification;
  3. Equity management;
  4. Balance sheet financing;
  5. Asset securitization financing;
  6. Real interest rates;
  7. Loan management and debt collection;
  8. Product category;
  9. Business cooperation;
  10. Information security;
  11. Illegal operation.

On December 13th, the NYSE-listed micro lender PPDAI released the unaudited financial performance report for Q3 of 2017. According to the report, in compliance with the recently issued cash loan regulations, PPDAI will

  1. Replace the one-time charges of fees into monthly fees;
  2. Reduce the overall fees and interests of its loan products to lower than 36%;
  3. Cancel the investor reserve funds from the year of 2018.

Here is the List of the Fintech 50 in China as Ranked by KPMG (Crowdfund Insider), Rated: B

Source: Crowdfund Insider

Figuratively Speaking (Global Times), Rated: B

0.78%

Nonperforming loan ratio as of end-November of Chinese online lender MYbank, backed by Chinese e-commerce giant Alibaba Group Holding.

European Union

Wealth Migrate Launches WEALTHE Coin to Democratize Access to Global Real Estate Investing (Euro Investor), Rated: A

Global online real estate marketplace Wealth Migrate today launched the WEALTHE Coin, a digital currency created to democratize access to wealth through international commercial and residential real estate ownership. Wealth Migrate allows for investment in real estate investment opportunities previously accessible only to high net worth individuals or institutional investors. While almost half of the world’s wealth is held in real estate, fewer than 13 percent of people have access or the resources to invest in and benefit from this lucrative market. Wealth Migrate aims to transform the real estate investment landscape and bridge the global wealth gap with its investment platform and WEALTHE Coin, with the vision of enabling anyone to invest with as little as $1.

WEALTHE Coin will be available in a token presale launching on the 15 December 2017, with the Public Crowdsale scheduled for February 1, 2018.

International

Three Blockchain Companies That Could Change Everything in Traditional Lending (Observer), Rated: AAA

More than $3.3 billion was raised with Initial Coin Offerings (ICO) this year alone.

SALT delivers an alternative route to make money from cryptocurrency assets without giving up your position. It’s a lending platform which uses blockchain to back loans. In simple terms, SALT brings the ability to list your blockchain assets as collaterals for a cash loan. Every crypto asset holder can lend them to anyone else, receive interests and regain their crypto asset as soon as the loan is paid back.

Another disrupting crypto lending project is Jibrel Network. It’s a place where users, brokers and investors can tokenize their financial assets and sell them on blockchain for profit. Even though the platform is still in development, it receives strong support from cryptocurrency enthusiasts and ICO investors. Moreover, its pre-sale ICO was more than success and raised over $3 million and attracted funds from both individual investors as well as institutions, such as TaaS Fund, Tech Squared, Aurora Partners and others.

ETHLend is a facilitating platform for both borrowers and lenders. Here, lenders and borrowers can meet up and decide everything from loan duration to the interest rate. Like Jibrel, the platform runs on Ehtereum network and uses ERC20 tokens act as a deposit on the loan.

Datarius Cryptobank Has Reached SoftCap in a Few Hours After Start of Pre-ITO (Digital Journal), Rated: A

Datarius Cryptobank has opened the doors to participate in the project to all comers and has gone to the pre-ITO stage. A SoftCap of $125,000 has been reached within just a few hours from the start of the campaign, as stated by information now available on the official website of the project.

ETHEREUM CO-CREATOR STEVEN NERAYOFF JOINS RCN ADVISORY BOARD AS THEIR GLOBAL LENDING ECOSYSTEM EXPANDS TOWARDS ASIA (Bitcoinist), Rated: B

Entrepreneur and venture capitalist Steven Nerayoffhas joined the RCN global lending project as a lead advisor.

RCN is a peer-to-peer credit protocol based on cosigned smart contracts that connect lenders and borrowers anywhere in the world and in any currency through the use of RCN tokens, the platform’s native cryptocurrency. Having successfully raised over $40 million during their recent token sale, the RCN network has the potential to democratize digital economy by increasing credit access for borrowers, eliminating the risk of default for lenders, and reducing asymmetric information between network agents.

Israel and Singapore fintech hubs sign MoU (Finextra), Rated: B

The Singapore FinTech Association (SFA) and the Israeli City TLV association have inked a Memorandum of Understanding (MOU) to foster greater FinTech co-operation between the two communities.

The Challenge Of Delivering Relevant Content To Educate Customers (Forbes), Rated: B

According to advisory firm KMPG, there was a total of $3.2 billion invested globallyin fintech companies in Q1 of 2017. What’s even more interesting is that a PwC report on fintech’s growing influence on financial services showed that 82% of financial services companies want to increase fintech partnerships in the next three to five years.

India

Fintech Startup Cash Suvidha Raises $ 2.7 Mn In Debt Funding (Inc42), Rated: AAA

Just a few days after fintech platform Finbucketannounced its $1.87 Mn funding, Delhi-based online lending startup Cash Suvidha has raised an institutional debt of $2.7 Mn from various financial institutions.

The funds have been raised from six financial institutions and will be primarily used to facilitate further lending to Small and Medium Enterprises (SMEs).

Amazon to strengthen fintech space with stake in Capital Float (Economic Times), Rated: A

Online retail giant Amazon is looking to expand its footprint in the financial technology space and is in talks to invest in digital lending startup Capital Float, two persons aware of the development said.

Bengaluru-based Capital Float, which has so far focused on small businesses, is also set to start consumer financing on Amazon’s platform, apart from the ecommerce seller financing it already does, they said.

Deal or no deal – 2017: transaction trends and regulatory reforms (YourStory), Rated: A

Online retail giant Amazon is looking to expand its footprint in the financial technology space and is in talks to invest in digital lending startup Capital Float, two persons aware of the development said.

 

Statistically speaking, at the close of the third quarter of 2017, FDI inflow was $25 million, with a growth of approximately 17 percent over the corresponding period last financial year.  Mauritius, Singapore and Japan topped the list of countries investing in India as of September, 2017.

From a VC-PE activity perspective, 2017 also recorded a six-year high in deal values, with deals worth approximately $48 billion, up 34 percent over 2016. According to data published by Venture Intelligence, ‘private equity firms invested about $17.6 billion in Indian companies in the first nine months of 2017, sailing past the previous high of $17.3 billion in 2015.’

The sectors that remained bullish in 2017 were fintech, digital innovation, IT e-commerce, logistics, infrastructure and life sciences. Within e-commerce, fintech, mobile gaming, and health apps contributed a significant pie in the growth trajectory.

Now, score high marks in exams to get low interest rates on loans (Times of India), Rated: A

Can 90% in your college exam get you an iPhone? It could as a number of online student lenders are scrutinising marksheets to assess credit worthiness, and hand out loans for consumer durables.

Nagaraju T, a 21-year-old student at Malla Reddy College of Engineering in Hyderabad bought a Lenovo i5 laptop for Rs 36,000 in 2016. “I got my dad to make the down payment of Rs 10,000, and I paid the EMIs of Rs 2,000. I closed the loan in 13 months, and then bought a MINote 4 for Rs 14,000 and paid monthly installments of Rs 850,” says Nagaraju.

KrazyBee places a cap of Rs 15,000 for consumer durable loans, Rs 50,000 for two-wheeler loans and Rs 3.5 lakh-Rs 4.5 lakh for educational loans.

KrazyBee, Faircent and Buddy.com say their non-performing asset (NPA) levels are under 3%, which is below the industry norm. The low default rate, they say, is due to risk assessment and screening of applicants.

Online lender Deal4Loans’ Rishi Mehra says the use of proxies such as marksheets instead of CIBIL scores needs to be viewed with caution. In the early 2000s, a rash of NBFCs lent based on such proxies for credit scores, he says.

FinTech startup Cash Suvidha raises USD 2.7 mn for expansion (Outlook India), Rated: A

Delhi-based FinTech startup Cash Suvidha, the trade name of Usha Financial Services Pvt. Ltd., raised an institutional debt of USD 2.7 million from various financial institutions towards driving growth.

Sort your loan application issues with these fintech apps (Outlook India), Rated: B

Every borrower registered on Faircent is identity-checked, credit-checked and risk-assessed by our system as well as an experienced team. Its tech-enabled credit evaluation algorithms reject over 90 percent of the borrowers who apply for loans.

OHMY Technologies Private Limited is the owner and operator of OMLP2P, an online Peer-to-Peer (P2P) lending platform. The platform assesses creditworthiness of a prospective borrower using its proprietary algorithm developed in consultation with CRIF HighMark, one of the leading Credit Bureau.

CoinTribe is a leading online loan disbursement platform that provides quick and easy collateral-free loans to small businesses and individuals. It is the only online lending platform which has back-tested its credit model with large banks.

Aye Finance differentiates itself by creating a technically enabled process that builds credit insights through a variety of available business and behavioral data. This effective credit appraisal coupled with the use of modern workflow automation, and a small but engaged workforce is helping bridge the gap between the MSMEs and organized lending.

CreditMantri is a multi-services platform that helps borrowers secure loans from its partner financers.

Asia

Uber rival Go-Jek drives payments push with acquisition of three fintech start-ups (CNBC), Rated: A

Ride-hailing start-up Go-Jek has acquired three financial technology (fintech) start-ups as it looks to dominate Indonesia’s digital payments space.

Go-Jek said Friday it had bought offline payments service Kartuku, payment gateway Midtrans and saving and lending firm Mapan for undisclosed amounts.

MENA

Fintech News from the Middle East and North Africa (MENA) (Finovate), Rated: B

  • Al Baraka Banking Group partners with Path Solutions to deploy iMAL Islamic core banking system.
  • UAE Exchange to launch gocash card and mobile app courtesy of partnership with online travel firm, Cleartrip
  • Online real estate marketplace and KPMG Global Fintech Top 50 member Wealth Migrate opens office in UAE, announces new country CEO, Lee-Ann Rush.
Russia

Russian fintech company challenges banks (Banks.am), Rated: AAA

According to the press service of the company, SimplyFi’s new product gives Russian company the opportunity to apply and receive loans up to RUR 300 000 (around USD 5000) from private investors completely remotely through a fully-electronic application process, transferred to any bank account.

Through a scoring system developed on the basis of technological analysis of big data, decisions on applications are made automatically within two hours. The company will only need tax ID and a statement of turnover in the settlement account. SimplyFi provides a 100% guarantee for the raising of funds once an application is placed on the market.

Canada

Financeit Recapitalizaton Gives Goldman Sachs Majority Stake (Finovate), Rated: AAA

Point-of-sale financing provider Financeit completed an investment round today with existing shareholder Goldman Sachs. The round gives the firm a majority stake in the Toronto-based fintech.

Financeit helps merchants increase closing rates and transaction sizes by enabling them to offer customers affordable monthly or bi-weekly payment plans.

Authors:

George Popescu
Allen Taylor