Friday April 7 2017, Daily News Digest

global fintech

News Comments Today’s main news: Lending Club media sentiment of 0.27. P2P ISA data disappoints. 83North closes $250M fund for EU and Israeli startups. AnyTimeLoans fights its way into Singapore. Today’s main analysis: FinTech’s growing influence on financial services. Wealth Tech exit activity in one timeline. Today’s thought-provoking articles: Top 8 Renaud Laplanche/Upgrade news stories. MarketInvoice has ambitious expansion plans. Fintech […]

global fintech

News Comments

United States

  • LendingClub receives media sentiment score of 0.27. GP:” We strive to be objective but we are still humans. Modestly, I do wish that more media was objective and looked at the numbers more though. I do think that being public did attract a lot of SEO and PR to Lending Club which shouldn’t be discounted. Also, the story based on ‘we are replacing the evil banks’ caught very well with a majority of the public. One shouldn’t underestimate a good story, or a pitch that is popular with the public. I am sure everybody remembers Google’s ‘don’t be evil’.  “AT: “Lending Club’s press is getting better, signifying the company is making a comeback even as its ousted former leader is making his own comeback with a rival startup. This will be an exciting year for alt lending.”
  • FinTech’s growing influence on financial services. AT: “FinTech has been likened to Uber’s move in on taxi services and Napster’s disruption of the music industry, but I see one fundamental difference. Instead of fighting the trend, legacy financial institutions seem to be embracing it with partnerships and innovative initiatives of their own. We can debate the effectiveness of these attempts to embrace FinTech, but they are at least trying. We couldn’t say that about the music industry’s response to Napster or taxi services’ reception to Uber and Lyft. The takeaway: Financial services have changed, for better or worse, because of FinTech (I say better), and legacy financial institutions are embracing that change, even if they are doing so with much chagrin.”
  • Wealth Tech exit activity in one timeline. GP:” Investors usually invest based on exits, the likelihood, and their size. This info is key for fundraising. Very few people build companies with a large EBITDA and cash flow for dividends in mind.” AT: “In the world of finance, the exit every bit as important (maybe more so) as entrances).”
  • Top 8 Renaud Laplanche news stories concerning Upgrade since yesterday. GP:” We would like to thank Renaud Laplanche for personally reaching out to Lending Times with the story.” AT: “Lending-Times was the first to report this news. Here are eight of the top news stories from the biggest news agencies in the world.”
  • The long and short of MPL. GP:” A very short summary, which is rather focused on the negative sides using words like gamble when there is no real gamble in fact.”
  • JPMorgan is rolling out a robo-advisor this year. GP:” What if JP Morgan Cahse rolled out their own small business lending product like Wells Fargo? What would happe to OnDeck’s stock for example?”
  • 9 things that separate good lenders from bad. GP:” There is a lot to say here, from underwriting, to focusing on quality of the loans vs quantity over time. And the trade off between growth and yield.”
  • Benefits of alt lending. GP:” A good summary is the phrase ‘ while equity markets were falling, the performance of these loans was unaffected’ “
  • JPMorgan’s fintech strategy. AT: “Jamie Dimon’s annual shareholder letter has received a lot of press lately, mainly for his regulatory requests. But he also disclosed some of JPMorgan’s fintech plans. Remember when he was deadset against fintech?”

United Kingdom

  • P2P Isa data disappoints on year on. AT: “What’s interesting is what Stuart Law has to say about Isas. They may not have overwhelmed us in the last year, but when the Big 3 finally are approved, you could see a wave of acceptance and activity.”
  • MarketInvoice has ambitious expansion plans. GP:” What I would do if I was in charge Learning from Lending Club’s experience: opening its underwriting data for free to the internet will attract a lot of attention, PR , SEO and build its credibility. Also having a secondary market will probably enable people to invest more freely as they will not be worried being stuck with paper for 3, 4 or 5 years.”

European Union



  • Renren dumps SoFi shares. GP:” SoFi shares are a hot commodity as I can’t imagine their valuation going down any time soon. Most likely this was driven by RenRen’s needs for cash. Note that they still kept 85.9% of their shares in SoFi. “



United States

LendingClub Corp (LC) Receives Media Sentiment Score of 0.27 (Sports Perspectives), Rated: AAA

Headlines about LendingClub Corp (NYSE:LC) have trended positive recently, AlphaOne reports.

LendingClub Corp earned a daily sentiment score of 0.27 on AlphaOne’s scale.

These are some of the headlines that may have impacted Alpha One Sentiment’s scoring:

LendingClub Corp (NYSE:LC) traded up 1.91% during mid-day trading on Thursday, reaching $5.34. The company had a trading volume of 3,066,593 shares. The stock’s market capitalization is $2.14 billion. LendingClub Corp has a one year low of $3.44 and a one year high of $8.41. The company’s 50-day moving average is $5.63 and its 200-day moving average is $5.64.

FinTech’s growing influence on Financial Services (PwC), Rated: AAA

The Financial Services industry continues to be fuelled by FinTech’s influence. The fact that consumers are increasingly doing business with these non-traditional players will do little to calm uncertainty. As incumbents react to this they are attempting to come together with FinTech; to leverage the ecosystem it creates, turn the innovation to their advantage and alleviate their concerns around their business being at risk.

Access the PwC Global FinTech Report 2017.

Buying Options: Wealth Tech Exit Activity In One Timeline (CB Insights), Rated: AAA

Wealth tech startups are disrupting personal wealth management and institutional trading, with companies in the space seeing a record 74 deals in 2016.

Though a relatively nascent subindustry, there have been 29 wealth tech exits since 2012, including 28 mergers and acquisitions (M&A) and 1 IPO. Exit activity surged in 2015, with a record of 11 exits, all of which were from M&A. 2016 lagged 2015 with 8 exits, all of which were also M&As.

2017 is off to a strong start with 3 exits as of Q1’17.

  • One of the earliest exits in the wealth tech space was a merger between Zecco and TradeKing in Q2’12.
  • TradeKing went on to acquire GAIN Capital Securities in Q2’13, TraderOS in Q1’15, and MB Trading in Q3’15. TradeKing was acquired in Q2’16 by Ally Financial at a $275M valuation.
  • Yodlee, a cloud-based data analytics software for wealth managers and investors, is the only wealth tech IPO since 2012.
  • Envestnet, a publically traded wealth management software provider, has been one of the most active acquirers in wealth tech, tying TradeKing with 3 acquisitions.

Top 8 Renaud Laplanche news stories since yesterday (Lending-Times Exclusive), Rated: A

Yesterday, Lending-Times was the first to report that Renaud Laplanche has returned with a new Lending Club rival, Upgrade. Since then, other news agencies have reported on the same news. Here are 10 of the top stories on Renaud Laplanche and his new consumer credit platform Upgrade.

  1. Renaud Laplanche, Ousted at Lending Club, Returns as Rival to His Old Firm (New York Times)
  2. Lending Club founder Renaud Laplanche is back with a new startup and $60 million in funding (TechCrunch)
  3. Former LendingClub CEO Renaud Laplanche launches new online lender (Reuters)
  4. Renaud Laplanche debuts second act post-Lending Club scandal (San Francisco Business Times)
  5. Renaud Laplanche Foregoes Subtlety In His Fintech Rebound Relationship (Dealbreaker)
  6. LendingClub’s Ousted CEO Renaud Laplanche Is Launching a New Online Lender (Fortune)
  7. Upgrade, Inc. Launches New Consumer Credit Platform (Yahoo! Finance)
  8. Lyft, Upgrade, Trov are latest to raise VC cash (Silicon Valley Business Journal)

The Long and Short Of It: Marketplace Lending (Investmentu), Rated: A

Since its inception in the late 2000s, marketplace lending has seen good and bad years. Today, an imminent interest rate hike has made its future uncertain.

Lending Club sorts its loans into almost 40 risk grades. Annual interest rates range from 6% for high-credit borrowers to 36% for risky borrowers. That makes them very competitive with traditional debt investments. It’s no wonder that marketplace loans soared 700% between 2010 and 2014.

Take a quick look at the stock performance of OnDeck and Lending Club. It becomes pretty clear that there are some problems under the hood. Both companies are down almost 50% in the last year.

Oversight said that 30-day delinquency rates were as high as 18% for some marketplace lenders.

An investor might be willing to gamble on a 6% return when Treasury bills are yielding 1%. But if U.S. government debt is yielding 3% or 4%, then marketplace lending is significantly less appealing.

JPMorgan is Rolling out a Robo-Advisor This Year (Financial Advisor IQ), Rated: A

JPMorgan is developing an automated advice platform it says will be ready this year, Bloomberg writes.

The company is developing several “exciting new products,” and among them are “online vehicles for both individual retirement and non-retirement accounts, providing easy-to-use (and inexpensive) automated advice,” JPMorgan CEO Jamie Dimon wrote in his annual letter to the company’s shareholders, according to Bloomberg.

In addition to digital banking and electronic trading, JPMorgan will be rolling out the automated advice service later this year, Dimon says in the letter.

9 Things That Separate Good Business Lenders from Bad Ones (Business2Community), Rated: A

A direct online lender is a company that actually supplies the money it lends to borrowers. Many business-lending websites are mere matching services that send out your application to a network of lenders. That might sound good, but it’s not, because you end up paying much more for you capital.

Look for a lender with a streamlined, paperless online application process that can be completed in minutes.

A good lender looks beyond your credit score, makes a decision in minutes and gets you your money the next business day. A good lender will not do a hard pull on your credit. A bad lender may require extensive underwriting, which can waste days and still end up in a denial.

A business lender with a maximum loan limit of $25K or $50K won’t satisfy many small business borrowers who need more. Look for a direct lender who is willing to lend up to $150K.

Read the rest of the article here.

Benefits Of Alternative Lending (, Rated: A

While nonbank loan channels have always existed parallel to traditional banking, these channels were historically small niches in the overall economy. However, a new breed of lender has emerged to become a significant presence in the market.

Today institutions are the predominant source of funding for alternative loans. For example, Lending Club, the largest U.S. platform, shifted from 100% retail funding in 2008 to 84% institutional funding in 2015.

Investors saw the same thing following the Brexit vote in June 2016. In both cases, while equity markets were falling, the performance of these loans was unaffected. Thus, there are times (though not all times), when an investment in these loans will help dampen portfolio volatility.

In both alternative lending and reinsurance, one reason these products offer equitylike expected returns without the equitylike volatility is the illiquidity risk that investors accept.

JPMorgan’s fintech strategy (Business Insider), Rated: B

Here are the areas in which JPMorgan is embracing fintech:

  • Investing in new technologies.
  • Developing new products.
  • Promoting financial inclusion.
  • Collaborating with fintechs.
  • Doubling down on data sharing.
United Kingdom

Peer-to-peer Isa data disappoints one year on (FT Adviser), Rated: AAA

Figures showed 42 companies now have full permissions from HM Revenue & Customs to offer the Innovative Finance Isa, which lets investors tap into alternative types of investment such as peer-to-peer lending.

But just 14 of the Isas are currently on the market, of which eight are offered by peer-to-peer providers, data compiled by P2P comparison service Orca revealed.

By the time the new Isa launched last year, just eight out of 86 peer-to-peer providers were fully authorised, and HM Treasury later admitted the Isa had got off to a slow start.

Stuart Law, founder of P2P platform Assetz Capital, described the Isa launch as “a bit of a damp squib”, adding: “Frankly, it may as well not have started.”

UK marketplace lender has ambitious expansion plans (Business Insider), Rated: AAA

Marketplace lender MarketInvoice, a P2PFA member and one of the UK’s leading alt lenders, has of late enjoyed US Small Business Administration.

European Union

83North closes $ 250M fourth fund focused on European, Israeli startups (TechCrunch), Rated: AAA

European VC firm 83North (formerly Greylock IL), which since 2008 has focused on backing startups in Europe and Israel, has closed its fourth fund — taking $250M in a raise that it says was both oversubscribed and its largest to date, and bringing its total capital under management to $800M.

In a statement she noted that the fund has already backed companies from France, Germany, Greece, Italy, Spain and Sweden, for example, and said it’s expecting European activity to accelerate in tech hubs outside London because of Brexit.

83North has invested in more than 40 startups to date.


Fintech partnerships reveal innovation insecurities (Financial News), Rated: AAA

The world’s banks have poured billions of dollars into new technologies but many say their innovation strategies are falling short as concerns about cyber security, intellectual property rights and procurement hinder partnerships with fintech firms.

The law firm found that just 7% called their institution “industry-leading” on digital innovation and only 16% considered their collaboration with financial technology firms to be “highly effective”.

The biggest barrier to successful collaboration with startups was cyber security, according to  71% of respondents.

Among the other hurdles were cultural clashes between fintechs and incumbents and issues around intellectual property rights; in both cases around 50% of respondents to the Simmons & Simmons survey flagged these as concerns, while only 19% said that their procurement processes were ‘highly effective’.

A separate survey of more than 1300 financial services and fintech executives published today by PwC, found that more than 80% believed parts of their business were at risk from standalone fintech companies (SEE CHART).

Top 10 Fintech Lending Companies and Their Worth (TechBullion), Rated: AAA

According to the findings of Transparency market research, the value of fintech lending will command between $150 billion and $490 billion.

  1. Lufax is one of the largest fintech lending company in China and the world at large. The company has provided loans worth over US$2.5.
  2. Founded in 1998 with its headquarters in Chaoyang, China, JD Finance is valued at US$7 billion.
  3. SoFi was established in 2011 with headquarters in San Francisco, United States. Currently, the company is valued at US$4 billion.
  4. GreenSky was established in 2006 with its headquarters in Atlanta. The company is valued at US$2 billion.
  5. Avant Credit was founded in 2012 and is headquartered in Chicago. It is worth US$2 billion.
  6. Founded in 2005, Prosper has its headquarters in San Francisco. Today, the company is valued at US$1.9 billion.
  7. focusing on business loans, Funding Circle has, since its establishment, funded different businesses to the tune of $2.5 billion.
  8. Kabbage was founded in 2009 and is headquartered in Atlanta. The company is currently valued at US$1 billion.
  9. Established in 2013 with the head office in Beijing, Jimubox is a peer-to-peer loan provider.
  10. China Rapid Finance was established in 2001 in Beijing but only started online lending in 2011. The company is a leading peer-to-peer consumer lender in China. It is currently valued at US$1 billion.

Renren Inc. Announces Disposition of Certain Shares of Social Finance, Inc. (Yahoo! Finance), Rated: A

Renren Inc. (RENN) (“Renren” or the “Company”), which operates a social networking service and internet finance business in China, today announced that it sold preferred shares of Social Finance, Inc. (“SoFi”) to certain investors on April 4, 2017, in connection with SoFi’s most recent round of equity financing. The Company received net proceeds of $91.9 million for these shares. After this transaction, the Company still has 85.9% of its previous holdings in SoFi.


Don’t Let a Low CIBIL Score Come in the Way of your Dream Home (Business-Standard), Rated: B

Want to know your exact score? Visit and pay a fee to carry the process forward. Your score will range between 300 and 900. According to experts, 79% of loans get sanctioned if the minimum credit score is 750.

Peer to Peer Lending: Peer to peer (P2P) lending is also another option to consider if a low score is standing in your way to secure that much-needed Home Loan. P2P lending matches lenders with borrowers and this is generally an online service. The service, because it is online, is more cost effective than traditional financial institutions. Lenders can hope to make higher returns and borrowers can borrow money at an interest that is best suited for them.


AnyTimeLoan fights its way into Singapore from the India chapter of Get in the Ring (The News Minute), Rated: AAA

Peer-to-peer lending platform AnyTimeLoan (ATL) won the India chapter of Get in the Ring on Thursday. ATL will now compete with startups around the world in the Global Startup Competition, which will be held in Singapore in May.

Twenty four startups participated in the competition of which sixe startups had a faceoff in front of the Jury. Paymatrix, Authbase, Gayam Motor Works, SpotDraft, ATL, NicheAI were the startups that made it to the round.

ATL is a peer-to-peer on demand lending provider which provides mortgages, small loans, overdrafts and loans against property. There is an algorithm that analyses information of the individual seeking a loan from 187 data points.


George Popescu
Allen Taylor

July 15th 2016, Daily News Digest

July 15th 2016, Daily News Digest

News Comments United States Jefferies and Lending Club dipping toes in the securitization water to test bringing back to the markets the securitization that started the Lending Club Odyssey. In a context where SoFi and Marlette are getting a lot of attention and bond rates are falling, going to market with a scrubbed clean portfolio, […]

July 15th 2016, Daily News Digest

News Comments

United States

European Union

  • Lendix launches an ELTIF (a new brand of fund cross-border, non-bank structure the EU has created !) for  €50-75m.  Lendix has €2.4m of turnover, €240k of operating profit and employs 11 people.

United Kingdom


  • A must read. And yes, AFRICA ! Zidisha in 2009 , disbursed a first loan to a Masai nomad in a remote part of Kenya, over a day’s journey from any bank but that had access to the Internet and to the mobile phone money transfer service we use to send loan payments. Smartphones and the internet penetrate much faster virgin markets when they don’t have to fight with existing infrastructure to displace it. Our readers should look at how fast p2p took off in China. I expect that once p2p takes off in real developing countries it will grow even faster than it did in China, although with smaller markets and similar fraud risks. Many people also forget the invaluable GOODWILL the p2p lending industry benefited from when it was just p2p. Goodwill is worth billions of dollars in advertising.



United States

Jefferies, LendingClub Said to Eye Revival of Scuttled Bond Sale, (Bloomberg), Rated: AAA

Jefferies Group is again considering selling bonds backed by LendingClub Corp. consumer loans, people with knowledge of the matter said, after disclosure issues at the online lender scuttled an effort earlier this year.

Jefferies is having preliminary conversations with investors to gauge interest in the bonds, and may decide not to go ahead with a sale, the people said, asking not to be identified because they aren’t authorized to speak publicly. The firm hasn’t fixed a deal size, but the original offering was expected to be around $150 million, people with knowledge said in April.

Wall Street banks are looking to sell similar bonds tied to loans made by at least two other online lenders in the coming weeks as well, according to a presale report and a person with knowledge of the matter. The offerings are a sign that markets for riskier debt may be thawing as record low bond yields spur investors to hunt for higher returns, while some of the world’s biggest money managers warn that risks are building up across global markets.

Among the other lenders looking to tap the market is Social Finance Inc., one of the biggest online providers of student loan refinancings. It has hired Deutsche Bank AG to underwrite, and may begin marketing a $575 million securitization toward the end of this month, encouraged by strong interest expressed in a similar deal they issued in June, a person with knowledge of the plans said.

Online lender Marlette Funding has hired Goldman Sachs to underwrite a securitization of its own. It could start marketing the notes as early as this week, according to a presale report from Kroll Bond Rating Agency and public disclosures tied to the offering.

Buyers of securities backed by online consumer loans have included DoubleLine Capital, JPMorgan Chase & Co. and BlackRock Inc., according to data compiled by Bloomberg that track ownership disclosures of the securities.

Kabbage Launches Industry’s First Fully-Mobile Application Experience for Small Businesses, (Press Release), Rated: AAA

Kabbage, the financial services data and technology platform, today announced that it has launched a powerful new iOS app for iPhone® and iPad® that allows businesses to complete the entire application process in a few simple steps. The app features drivers’ license recognition, instant mobile check verification, and Apple’s Touch ID™ fingerprint authentication to deliver the best-in-class user experience and reduce the friction usually required to access business capital.

The company now drives $7 million per month in originations from mobile devices and nearly 64,000 monthly user interactions on the app.

Secondary market analysis, ( NSR Invest), Rated: AAA

What loans are available on the secondary market?
We analyzed the current listings on Folio between June 22-27, 2016.  The following are averages across the available listings:

Note Size: $35
Markup/Discount: +4.12%
Interest rate: 16.71%
Yield to Maturity: 15.39%
Loan Age: 11.17 months
Borrower FICO Score at Origination: 686
Days listed on Folio: 4
Remaining Payments: 39

83% of loans have never been late on payments
89% are current on payments
Even split between FICO scores trending up/down

Interestingly, while the average stated interest rate on Folio is 16.71%, the average is only 13.15% (non-weighted average rate) for the entire Lending Club index of loans. This indicates that investors who sell notes on the secondary market are generally listing notes with lower credit grades as compared to the index distribution of loans.

What about loans that are listed almost immediately after origination?
Loans that are listed within three months after origination (aka “fast flips,” because these notes are bought and quickly listed for sale) have a significantly higher markup compared to all loans listed. These fast flips have an average markup of 5.86%, while the entire sample is only 2.18% (only current loans included).

What dictates markup/discount of a loan on the secondary market?
From the data we analyzed, the greatest correlation with the markup/discount of a note is whether or not the borrower has ever made a late payment – about 40% of note pricing was explained by this metric alone. Other variables with positive correlation to the markup/discount are credit score trend, interest rate, and ask price (higher principal value is correlated with higher markup). A negative correlation was found with attributes such as Inquiries in the last six months, number of remaining payments, days since last payment, and outstanding principal.

Can’t Get a Loan for Your Business? I Don’t Believe it, (Fox Business), Rated: AAA

I don’t hear any complaints about getting financing. And there’s a reason for that. The financing environment for small businesses in 2016 is not just good: It’s great. In fact, it’s better than it was before the Great Recession.

Yes, venture capital and angel investing have both recently slowed.

For the established small businesses who reside in industrial parks and office complexes around the country and distribute pipes, manufacture film, mow lawns, fix roofs and serve meals – the financing environment is strong. When they want loans to grow their companies they have plenty of options today.

Don’t believe me? Then why, as Forbes recently reportedOpens a New Window., is Wells Fargo (which releases earnings this week along with other banking giants Citigroup and JP Morgan) calling on those small business applicants that it previously rejected for loans?

Big banks are lending more: According to monthly index prepared by Biz2CreditOpens a New Window., a marketplace for online lending, small business loan approval rates at big banks ($10 billion+ in assets) is now at an all-time high. Big banks this year are approving loans at a 6% higher rate than last, and the approval rating has increased seven of the last nine months. The most recentOpens a New Window. Private Capital Access (PCA) Index by Dun & Bradstreet and Pepperdine University Graziadio School of Business and Management found that small business access to capital has steadily risen over the past four years. In January, Citigroup said itOpens a New Window. lent more than $10 billion to U.S. small businesses in 2015, which was 120 percent more than it loaned in 2009. Wells Fargo has set a 5-year, $100 billion lending goal with a new loan programOpens a New Window.announced earlier this year. PNC Financial Services Group recently announced that it is extendingOpens a New Window. its popular consumer loan programs to now include small businesses.

Alternative lenders are filling in the gaps that big banks can’t serve. The online lending industry has exploded over the past few years, led by firms like CAN Capital, Kabbage, Lending Club and others. PayPal and Square are providing merchant advances for working capital to their customers who qualify based on their cash flow. And other big companies are jumping in: Office supply giant Staples has partnered with Lendio to offer lower cost loansOpens a New Window. to small businesses. American Express recently announcedOpens a New Window. a planned partnership with Lendio. Chase and alternative lender OnDeck Capital just formedOpens a New Window. an alliance. Kabbage just partneredOpens a New Window. with Scotiabank to provide loans to businesses in Canada and Mexico.

The Small Business Administration is booming. According to this reportOpens a New Window. from the Small Business Finance Institute, 2015 was a good year for bankers offering SBA backed financing, particularly the most common 7(a) loans. “SBA lending overall results, as measured by the agency’s monthly approval statistics, finished FY 2015 with better results in every category, but especially rich for 7(a) guaranteed lenders. The 7(a) program “shattered all previous Total SBA Loan Volume 2015 records for total loan volume, and even for the number of loans greater than $150,000. It’s 504 debenture volume also “grew for the first time since 2012, hopefully signaling that declining years are behind the program.”

Of course, the news is not all rosy. It never is. The PCA survey above also found that small businesses’ access to traditional bank loans, while increasing, still lags behind that of middle market companies, which means that many small businesses still rely on personal assets and personal credit for financing.

So please, don’t tell me that you can’t get a loan for your small business. You can. I understand if it may be too expensive because lenders believe that your business is a riskier investment. However, that’s your choice. Be grateful that you have one.

CreditexchangeTM Raises Seed Capital from Kuber FinancialTM, (Business Wire), Rated: A

Creditexchange, India’s first hybrid digital consumer loans platform and institutional marketplace, has announced that it has raised an undisclosed amount of funding from Kuber Financial as part of its $500,000 seed round.

Creditexchange is building a digital loan origination business which it intends to support with a marketplace for institutional investors through which they can co-invest in portfolios of loans originated by Creditexchange. The hybrid model allows Creditexchange to overcome the issues faced by existing Indian peer-to-peer and marketplace lending models, mainly with regard to turn-around-times and opaqueness around regulation.

Creditexchange had previously announced a strategic technology partnership at LendIt San Francisco 2016 with LendFoundry, a market-leading platform which is trusted by large online marketplace lenders in North America, to develop a best-in-class platform customized for the Indian market.

Kuber Financial is a global FinTech holding company that invests in analytics and technology driven financial services start-ups. It is founded by Timothy Li, an established figure in the US FinTech space where he has been an advisor to start-ups like Kabbage, Rocket Loans, Blinker etc. besides being the ex-CIO of Realty Mogul, ex-CRO of Quick Bridge Funding and ex-GM of consumer lending at Loan Depot. The advisory board of Kuber is made up of Jim Redmond (Advisor to Funding Circle), Eric Bunting (early investor of Kabbage and Funding Circle), Jason Raneses (Software Architect at Credit Karma) and Amy Wan (ex-General Counsel of Patch of Land).

How the Underwriting Process Works With Funding Circle, (Fundera), Rated: A

Soon after you hit the submit button to send your completed online application, you’ll get a call from an account manager. This personal contact will not only help guide you through the process but will serve as an intermediary between you and the underwriter, according to Account Manager Natalie Roberts.

The account manager is charged with the task of getting to know more about your company’s present needs as well as your growth plans for the future. They’ll discuss your loan application with your assigned underwriter, who’s hard at work reviewing your credit report and other financial data.

To that end, if the underwriter is missing information from you or would like to discuss something about your business in more detail, you might get a direct call from them. “It depends on how the process is going,” says Roberts.

If you do receive a phone call, it will usually last about 15 to 20 minutes, depending on the size and complexity of your business and loan application.

You should be prepared to tell your story and answer the following questions:

  • Why did you start your company?
  • What opportunities and challenges do you face?
  • How do you derive revenue?
  • How will this loan help your business grow?
  • How do you plan to repay the loan?

What Else Does the Underwriter Look For?


This relates to any type of assets or property that might secure your loan.


Funding Circle will examine how much capital you’ve invested in your own business.


In a nutshell, your capacity is your ability to pay back your loan.


This relates to any situation that may affect your funding.


Your character gives Funding Circle a general view of your trustworthiness and stability. For example, the underwriting team may want more information on how much experience you have in your industry and whether you have historically made payments on time. An underwriter might also take a look at your social media feeds and read any of your company’s reviews on sites like Yelp. Positive customer reviews and comments go a long way.

Red flags

Because Funding Circle is in the game to help fuel your growth, if you’re looking for a loan as a lifeline, this will be a red flag. Funding Circle will see this if your company has taken on a large amount of new debt in the past 9 months with no real reason to explain this.

July 28, 2016. This transaction represents the second securitization collateralized by unsecured consumer loans originated by Cross River Bank, under the Marlette Best Egg Platform and sold to Marlette Funding, LLC (“Marlette”) or its affiliate.

Founded in 2013 in Wilmington DE, Marlette operates an online marketplace lending platform, operating under the Best Egg brand (

European Union

Lendix launches first ever SME lending fund in ELTIF structure, (Alt Fi), Rated: AAA

Recent European Union regulation created the ELTIF, a new brand of fund available for retail and professional investors that is designed to stimulate cross-border, non-bank investment across the EU.

The Paris-based SME lending platform has launched the first European Long Term Investment fund (ELTIF) dedicated to SMEs. The French stock market regulator, the Autorité des Marchés Financiers (AMF), gave the go ahead to Lendix to take advantage of the ELTIF format following its launch. It is called the Lendix SME Loans fund II.

The fund will be between €50-75m in size and is currently backed by several larger institutional investors including CNP Assurances, ZencapAM (OFI Group) and the fund ‘Prêtons Ensemble’ managed by Eiffel Investment Group and sponsored by Aviva France and AG2R La Mondiale.

Lendix allows SMEs to borrow €30k to €1.5m over periods ranging from 3 to 84 months to finance their development and expansion. The average loan size is €250k.

Patrick de Nonneville, chief operating officer of Lendix says the average SME borrowing on Lendix has €2.4m of turnover, €240k of operating profit and employs 11 people.

“It’s under the radar of all existing debt funds, so it’s a new asset class for investors. Lendix strengthens its objective to serve both private investors selecting their loans directly on the marketplace and institutional investors investing through the fund,” he said.

United Kingdom

Funding Knight Review – The Safety of Peer-to-Peer Lending, (FX News Call), Rated: B

Comment: A better article on how Funding Knight failed would really be useful for the industry. If you would like to write it Lending Times would love publishing it.

In the wake of emerging peer-to-peer websites, many of those who were saving with Funding Knight had lost hope of getting back their money. Claims indicated that the company was running out of cash, causing its fall into administration. This caused panic to more than 900 savers, but nevertheless, a recent Funding Knight review has given them a new dawn given the rescue of the firm by GLI Finance, an investment firm.

Industry says August rate cut “inevitable”, (Financial Reporter), Rated: A

Following the news that the Bank of England’s MPC voted to maintain Bank Rate at 0.5%, the financial services industry says that the Committee has made its intention to cut rates in the near future clear, and widely expects a rate cut of 0.25% next month.


Zidisha: the first global peer-to-peer microlending platform, (Blasting News), Rated: A

Lenders anywhere in the world can visit our website and browse loan proposals written directly by disadvantaged entrepreneurs in developing countries. Each lender can lend as little as a dollar to help crowd-fund a loan project. We send the funds directly to the borrower, and as the borrower repays, we return the funds to lenders. Lenders can either withdraw the repayments, or use them to fund new loans. This is a high-impact way to do philanthropy because the funds keep being recycled into new loans; $50 put into a Zidisha loan fund generates on average $750 worth of loans in five years! Lenders can also dialogue directly with the borrowers.

In 2006, I was volunteering in Senegal, Africa, raising microloans for women in rural villages through Kiva.

When I returned to the United States, we registered a local microfinance organization and hired a loan officer to manage the loans and to liaise with Kiva on the villagers’ behalf. Though we tried to be frugal, this ended up being expensive due to administrative costs. To be sustainable, we would have to charge the women more than 30 percent interest, almost enough to leave them poorer than they were before taking the loans! This is the story of microfinance in general: the world’s poorest people are paying the highest interest rates – the global average is 35 percent, but rates of 80 percent – 100 percent are not uncommon.

Eliminating the intermediary bank allowed us to reduce the cost of each loan to just 5 percent. In 2009, we disbursed our first loan to a Masai nomad in a remote part of Kenya, over a day’s journey from any bank but that had access to the Internet and to the mobile phone money transfer service we use to send loan payments. We named the organization “Zidisha,” which is Swahili for “grow,” as in an investment, business or quality-like prosperity. We now have more than 55,000 members in 157 countries and have raised loans for more than 28,000 small businesses around the world.

We’d like to be able to fund everyone who applies and also expand to offerlending services in more developing countries. If we can help people improve their quality of life, then building Zidisha is time well spent.


Cibil builds 360 degree view of consumer; what you really must know, (The Financial Express), Rated: A

As lending by microfinance institutions (MFIs) was never higher, it is no surprise that the country’s premier credit information company (CIC), CIBIL, has decided to get into this segment as well. In an interaction with FE, its chief operating officer Harshala Chandorkar speaks about challenges involved and how it is a win-win situation for MFIs, banks and borrowers.

Is the profiling and the data that you have acquired for MFI borrowers any different from that of borrowers from banks? Does the fact that most of the MFI lending tends to happen to joint liability groups (JLGs) a challenge?

The data points remain the same. Most MFI borrowers have a voter ID and an Aadhaar number. The challenge, however, arises when it comes to other aspects. Names tend to be very common in small villages. Addresses are not as strong and differentiated as that in metros.

With the Reserve Bank of India (RBI) deciding to bring peer-to-peer (P2P) lending platforms under its purview, do you expect a change in the way individual’s credit appraisals are done, particularly given that such platforms are probably going to entirely bypass institutions like yours?

I think it will be beneficial for everyone if all the lending via P2P platforms is reported to credit information bureaus as it will help even P2P lenders to take informed decisions when they decide to lend to an individual. Secondly, the non availability of P2P credit information to banks might make borrowers over leveraged.


George Popescu