- Today’s main news: RateSetter partners with Experian. Australia publishes fintech regulation draft laws. Lending Loop hits $10M financing milestone. TD Ameritrade offers stock trading through Facebook Messenger. Abra secures $16M in Series B led by Chinese electronics manufacturer. Zero raises $8.5M for credit card that acts like a debit card. Nested raises 36M GBP. TransferWise changes its fee structure, but is it better? Nubank now offers transfers, payments.
- Today’s main analysis: Chinese overseas investors prefer tech stocks.
- Today’s thought-provoking articles: Biometrics is going to eat the finance world. How Chinese microlenders are changing financing. The role of punctuation in P2P lending. Billion dollar startup creation shifting out of U.S.
- TD Ameritrade now offers stock trading through Facebook Messenger. AT: “There’s no telling what kind of financial services that will someday be offered through Facebook Messenger. There seems to be an increase in services piggybacking off Facebook’s reputation and user base. Maybe someday we’ll all do our banking through Facebook.”
- Chinese company invests in digital wallet startup Abra.
- Zero raises $8.5M.
- Biometrics is going to eat the finance world. AT: “We’ve only just begun to see what biometrics can do.”
- Cross River Bank exploring white label front-end app with BaaS functionality. AT: “Banking as a Service should only be done by banks, says CEO.”
- loanDepot partners with OJO Labs.
- Large banks make terrible partners.
- Buy the Block targets black investors.
- Evolve Capital Partners advises on CleanFund transaction.
- Thrive delivers landmark performance for Horizon Community Bank.
- IBM, Zelle partner on advance P2P payments.
- Fintech companies close the banking gap.
- 3 types of alternative lenders. AT: “For those new to alternative lending.”
- 12 tips for getting the right startup loan.
- Speedy Cash files for IPO.
- How Americans would spend $1B.
- Arcadia launches new online payment options with Klarna.
- RateSetter partners with Experian.
- Nested raises 36M GBP.
- TransferWise changes fee structure.
- Is IFISA boom coming to P2P sector?
- LendInvest Real Estate Opportunities won’t lock you in.
- Countingup raises 750 Euro.
- Invest in property development with 500 GBP.
- How to access business finance.
- London is still the #1 fintech hub.
- How general practitioners can raise funds.
- Financial services trademarks increased.
- How Chinese microlenders impact financing. AT: “The most interesting analyses today are coming out of China.”
- Chinese overseas investors prefer stocks. AT: “They also prefer Chinese companies on the U.S. stock exchange.”
- The role of punctuation in P2P lending. AT: “Very interesting. A must-read report.”
- Qudian looks overpriced.
- P2P lenders face IPO scrutiny.
- Credit industry leader joins China Rapid Finance BOD.
- Billion dollar startup creation shifting out of U.S. AT: “China is picking up the slack.”
- Wish Finance.
- Better structure could protect P2P investors.
- Lending Loop hits $10M financing milestone. AT: “Congratulations.”
- Employers can now pay employees by the day.
- GDS Link joins Canadian Lenders Association.
- United States
- TD Ameritrade Clients Can Now Trade Stocks on Facebook Messenger (Bloomberg), Rated: AAA
- Hon Hai invests in fintech start-up (Taipei Times), Rated: AAA
- Zero raises $ 8.5 million for a credit card that functions like a debit card (TechCrunch), Rated: AAA
- Biometrics is Going to Eat the Finance World (Lend Academy), Rated: AAA
- ‘We’re moving from the back end to the front end’: Cross River Bank CEO Gilles Gade (Tearsheet), Rated: A
- loanDepot Announces Agreement with Artificial Intelligence Real Estate Technology Company, OJO Labs (PR Newswire), Rated: A
- Large banks make terrible partners, fintechs say (American Banker), Rated: A
- ‘Buy The Block’ on its Way to Raising Millions of Dollars for Property Development in Black Communities (BlackNews.com), Rated: A
- Evolve Capital Partners Advises on CleanFund’s Financing Transaction (Accesswire), Rated: A
- Thrive Delivers Landmark Performance Gains for Horizon (Thrive), Rated: A
- IBM and Zelle team up to advance P2P payments (Banking Technology), Rated: A
- How FinTech Companies Are Closing The Banking Gap (Forbes), Rated: A
- 3 Types Of Alternative Lenders You Need To Know About (Bisnow), Rated: A
- 12 Tips to Get The Right Loan For Your Startup (Killer Startups), Rated: A
- Payday lender Speedy Cash files for IPO (Axios), Rated: A
- Islands, Bodyguards, and Mansions – How would you spend $ 1 Billion? (NJ Online Casinos), Rated: B
- Arcadia launches new online payment options (Drapers Online), Rated: B
- United Kingdom
- RateSetter partners with Experian to boost business credit assessment (P2P Finance News), Rated: AAA
- Nested Raises £36M in Third Round of Funding (Finsmes), Rated: AAA
- TransferWise changes fees for GBP transfers, introduces complicated flat transaction fees (TechCrunch), Rated: AAA
- Is an IFISA-inspired boom coming to the P2P sector? (P2P Finance News), Rated: A
- The property loan fund that won’t surprise you with a lock in (Citywire), Rated: A
- Accounting and business banking fintech raises €750k in seed round (AltFi), Rated: A
- Invest in property development from just £500 (This is Money), Rated: A
- HOW DO I… ACCESS BUSINESS FINANCE? (BQ), Rated: A
- London – Still The #1 FinTech Hub (Let’s Talk Payments), Rated: A
- Seven tips to help prepare to raise funds for your GP practice (Practice Business), Rated: B
- Number of UK financial services trade marks surges due to fintech growth (Finance Feeds), Rated: B
- A glimpse at how Qudian and China’s online micro lenders revolutionise financing (SCMP), Rated: AAA
- Chinese overseas investors prefer tech stocks (Technode), Rated: AAA
- The Role of Punctuation in P2P Lending: Evidence from the People’s Republic of China (Asian Development Bank), Rated: AAA
- China’s Latest Fintech Offering Looks Overpriced (WSJ), Rated: A
- Chinese P2P lenders face IPO scrutiny (International Financial Law Review), Rated: A
- Credit Industry Leader Joins China Rapid Finance Board of Directors (PR Newswire), Rated: B
- European Union
- 3 Advices For Peer-To-Peer Investors From ‘Inspeer’ Ceo (Coinidol), Rated: A
- Creation of Billion Dollar Startups Shifting Out of US (BW Disrupt), Rated: AAA
- Wish Finance: Small Business Lending Blockchain Platform (BlockTribune), Rated: A
- Better structure could protect investors in P2P market – BoJ paper (Central Banking), Rated: A
- Australia publishes draft laws for relaxed fintech regulation (Reuters), Rated: AAA
- Adopt digital to retain industry fund members (Super Review), Rated: A
- Fintech Valley Vizag and Knowledge Partner KPMG Announce Finackathon 2017 (BW Disrupt), Rated: AAA
- Betterpaydayloansonline.com Now Allows Getting Quick Payday Loans (MENAFN), Rated: B
- LENDING LOOP HITS MILESTONE OF PROVIDING $ 10 MILLION IN FINANCING (Betakit), Rated: AAA
- A new service is helping employers reduce turnover by paying their employees by the day (The Washington Post), Rated: A
- GDS Link Joins Canadian Lenders Association to Support Innovative Lending; Sponsoring Canadian Lenders Summit (PRWeb), Rated: B
- Latin America
- Brazilian fintech Nubank offers accounts for transfers, payments (Reuters), Rated: AAA
TD Ameritrade Clients Can Now Trade Stocks on Facebook Messenger (Bloomberg), Rated: AAA
TD Ameritrade Holding Corp. customers are now able to trade equities and exchange-traded funds using Facebook Inc.’s Messenger services, according to a company statement Monday. Clients can also make deposits, access quarterly performance video statements and receive weekly alerts that rehash market moves.
Hon Hai invests in fintech start-up (Taipei Times), Rated: AAA
Hon Hai Precision Industry Co (鴻海精密), the world’s largest contract electronics manufacturer, participated in a US$16 million Series B fundraising program to invest in US-based digital wallet start-up Abra, the new firm said on Monday.
Barhydt said that Abra’s existing investors — Arbor Ventures, American Express Ventures, Jungle Ventures, Lehrer Hippeau and RRE — also participated in the fundraiser that closed on Monday.
The program helped Abra reach more than US$35 million in total capital, Barhydt said, but did not elaborate on potential uses of the additional US$16 million.
Zero raises $ 8.5 million for a credit card that functions like a debit card (TechCrunch), Rated: AAA
Just one-third of young adults have a credit card, according to a Bankrate survey.
A startup called Zero thinks it has a solution to this and it is gearing up to launch a credit card that functions like a debit card. The startup is also raising $8.5 million in a funding round led by ENIAC Ventures, including participation from NEA, Lightbank and others.
Biometrics is Going to Eat the Finance World (Lend Academy), Rated: AAA
In a recent survey it was revealed that 81% of people use the same password for multiple accounts with that number being even higher, at 92%, for millennials.
The introduction of Touch ID on the Apple iPhone in 2013 was a seminal moment in the history of biometrics. People could suddenly use their thumb or finger print as an identity verification tool and forgo using a password. Today, on my phone I can login to my bank account, buy music or apps, buy a plane ticket, even check my Lending Club account all with the press of my thumb.
While still primarily in the testing stage in banking, this past summer Bank of America announced the trialing of iris scanning technology from Samsung. In the UK, TSB is becoming the first European bank to start using this same technology, also with Samsung phones.
Behavioral biometrics can capture things like hand-eye coordination, pressure, hand tremors, keystroke dynamics, gait analysis, mouse use characteristics, navigation, scrolling and other finger movements.
USAA offers three variations of biometrics authentication already in their mobile app. Just this week Samsung announced a partnership with Biocatch to bring behavioral biometrics to its Nexsign biometric authentication platform.
‘We’re moving from the back end to the front end’: Cross River Bank CEO Gilles Gade (Tearsheet), Rated: A
Cross River banks some of the biggest names in fintech, including at least a dozen online lending companies like Affirm, Marlette and Rocket Loans. It has also developed payments solutions for faster, more secure and lower-cost transfers that have been integrated by TransferWise and the bitcoin wallet Coinbase, as well as Google Wallet and Stripe in the past.
It’s been almost a year since you announced your VC funding. How have you been using it?
We have absorbed the capital very quickly, managed to deploy it on the marketplace lending side. We like to retain loans from the origination platforms so instead of selling 100 percent of the origination we retain 10 percent. As our partners are growing nicely, naturally that 10 percent has kept increasing.
Can both banks and fintech vendors deliver banking-as-a-service?
We’re strong believers that BaaS has to be delivered by a bank. The fintech players need access to payment rails and they’re going to use a bank ultimately to do that. As a service, the bank could be either the facilitator of a transaction or the purchaser of the BaaS technology to provide it to consumers. There is a level playing field now — consumers can have the same functionalities in a small bank in Nebraska that they can have with a Chase or Wells Fargo.
Are banks prepared?
Most banks are not equipped or not API-driven, ubiquitous, priced properly — and the banks that are, the big banks, have been unwilling to do that because it would cannibalize some of their business or presents high risk — do they have the required compliance and adequate staff to be able to manage the operations?
What’s going on inside Almond?
Almond is our exploratory R&D lab for us to understand the aspirations of consumers. We’re trying to develop a front-end solution that could possibly be a killer app that we could white label and sell as one BaaS functionality — so that would be an online or mobile app for a bank account. We’re moving from the back end to the front end.
loanDepot Announces Agreement with Artificial Intelligence Real Estate Technology Company, OJO Labs (PR Newswire), Rated: A
Today loanDepot announced an agreement with OJO Labs, Inc. to act as the mortgage provider of its machine-powered assistant known as “OJO.” By matching OJO’s leading AI technology with loanDepot’s digital lending platform, melloTM, the combined offering will allow house hunters to access real estate and mortgage information, and get pre-qualified, through an entirely digital, mobile-first experience.
Large banks make terrible partners, fintechs say (American Banker), Rated: A
While large banks and fintechs are ostensibly working more closely together than ever, in private conversations and even publicly at a few conferences, fintech leaders have expressed increased frustration about working with bank partners.
Though they won’t name names, they claim tier-one U.S. banks string them along, fail to communicate, don’t pay anything and, worst of all, out-and-out steal intellectual property.
More seriously, fintechs claim large banks are bad at paying for new technology and services.
Parker Crockford, commercial director for the U.S. at identity verification software startup Onfido, said at the RegTech conference in early October that when he’s engaging with large financial institutions, “we get pulled into a lot of innovation conversations where they just want to pick our brains and look cool. I don’t have time for that any more. I’ll say, ‘I’m happy to give you a white paper or a 20-minute chat over the phone.’”
‘Buy The Block’ on its Way to Raising Millions of Dollars for Property Development in Black Communities (BlackNews.com), Rated: A
Entrepreneur Lynn P. Smith is the founder and CEO at Buy The Block – one of the only Black-owned platforms in the country that is dedicated to making investments in real estate as a group more accessible. The movement is presently on its way to recording massive success in funding for diverse development projects across Black communities in the US.
This enviable initiative offers every Black American an opportunity to invest as little as $100, and connect with other investors – with an added advantage of helping every member buy a piece of their first block.
Evolve Capital Partners Advises on CleanFund’s Financing Transaction (Accesswire), Rated: A
Evolve Capital Partners,Inc. is proud to announce that its client, CleanFund Commercial Capital, Inc., the leading direct provider of commercial Property Assessed Clean Energy (“C-PACE”) financing, recently announced its first closing of a $15 million equity financing round, led by Vulcan Capital affiliated entities. The financing will accelerate CleanFund’s growth across the U.S. and help the company continue to meet growing demand from commercial property owners.
Thrive Delivers Landmark Performance Gains for Horizon (Thrive), Rated: A
Thrive Inc. (Thrive) is excited to announce the compelling performance of its digital lending technology, ensuing from its multi-year technology licensing agreement with Horizon Community Bank (HCB), a leading Arizona-based FDIC insured bank and subsidiary of Horizon Bancorp, Inc.
Key Performance Highlights:
- Application Time: Avg. of 5 minutes, as opposed to days
- Automated Decisioning: 90% of applications are instantly decided; powered by Thrive’s configurable credit rules based algorithms
- Time to Decision: <1 Day, as opposed to several weeks
- Loan Booking Rate: 100%, as applicants prefer the quick digital application and decision process
- Offer to Close: 1.5 Days, digital closing enables efficiency
Key Portfolio Highlights:
- Portfolio Interest Yield: Above market interest rates drive loan profitability
- Customer Acquisition Costs: <$200, driven by leveraging internal bank customers as well as new customers
- Delinquent/Charge-Off: 0%, effective underwriting and real time loan monitoring is driving modern and powerful risk management while also compressing loan reviews
- Monthly Origination Growth: 60%, driven by customer demand for a quick, efficient and friendly loan application experience
IBM and Zelle team up to advance P2P payments (Banking Technology), Rated: A
IBM says it has launched an “industry first” solution to support the full lifecycle of peer-to-peer (P2P) transactions, from the back office of financial institutions to the mobile device.
The project is a collaboration with Zelle, a P2P network in the US built on the clearXchange platform. Zelle now includes over 20 banks and credit unions, and is poised to reach an estimated 85 million US customers this year.
How FinTech Companies Are Closing The Banking Gap (Forbes), Rated: A
According to the World Bank, there are two billion people globally who currently have no access to banking services.There are many reasons for this: they may not have built up enough traditional credit history, they may have bad credit because of poor financial choices in the past, or they may live in an area where access to credit and other financial services are limited.
For instance, Jennifer Tescher, founder and president of The Center for Financial Services Innovation (CFSI), has helped launch financial inclusion initiatives by incubating startups addressing U.S. financial health through their Financial Solutions Lab. Some of these startups include Propel, which streamlines the food stamp process; Bee, a mobile alternative to potentially predatory financial services for low-income people; and popular startups that aim to assist with savings and debt repayment including Digit, EarnUp and LendStreet.
Founder and CEO Shivani Siroya, of California-based Tala, is trying to fix the challenge of low access to financial services by providing alternative credit scoring and instant credit delivery via mobile wallet.
Mexico, for instance, sees 38% mobile wallet use, compared to 17% overall in the US, even though 93% of Americanshave access to financial services.
3 Types Of Alternative Lenders You Need To Know About (Bisnow), Rated: A
1. Crowdfunding Platforms
Real estate crowdfunding hit $2.5B in 2015 and shows no sign of slowing down.
Platforms like RealtyShares and Fundrise offer several loan options and flexible payment terms, and cater to different asset classes. The latter prioritizes small-deal properties valued under $50M, and the former charges no fees for the first two years, or until an investment earns a 15% annualized return.
2. Nondirect Marketplace Lenders
Nondirect marketplace lending uses technology to connect lenders directly with borrowers, bypassing traditional banks, reducing barriers to transaction, and offering strong savings for borrowers and good returns for lenders. Popular for auto and student loans, financial institutions have increasingly stepped into the commercial lending role on these platforms, creating a marketplace in which loans are packaged and sent out to individuals, hedge funds, wealth advisers and banks.
3. Direct Lenders
Money360 is a direct lender with discretionary capital that ensures certainty of execution and timely closings. The lender offers loans between $1M and $20M on both bridge and permanent loans, with competitive terms and features similar to traditional lenders. Bridge loans are interest-only, and like banks, permanent loans use 25- to 30-year amortization schedules.
12 Tips to Get The Right Loan For Your Startup (Killer Startups), Rated: A
1. How much do you need for a small business loan for your startup?
Microloans work with the Small Business Association (SBA). They are for businesses that need to borrow between $35,000-$50,000 and have a limited credit history.
2. How quickly do you need access to loan funds?
If you’re positive that you need $100,000 right-off-the-bat, then an installment loan may be a better option. If you need $50,000 to start, but believe you’ll need additional capital down the road when you start to grow, you may want to look into revolving credit.
3. What is the loan going to be used for?
4. How long have you been in business?
If your business is still in the early stages, it may be difficult to secure a loan from traditional lenders like a bank since they require a positive credit history, collateral, business plan, projected financial statements, and cash flow projections.
In this situation, you may have to search for a small business loan from an alternative lender like an online lender like Lending Club.
5. Do you have collateral?
Do you have an property or inventory that you can put up as a collateral? If not, you may not qualify for a loan from a traditional lender. Instead, you may have to seek alternative funding options where you would offer accounts receivable, future sales, or a percentage of the company in exchange for the loan.
6. Eliminate your bad debt.
7. Research possible loan provider options.
Do your due diligence and seek lenders that are transparent with their rates, terms, and have positive reviews from customers.
8. Consider your niche.
9. Find a grant or contest.
10. Crowdfund Your idea.
11. Pay attention to APR, fees, and other costs.
12. Investor or capital?
Payday lender Speedy Cash files for IPO (Axios), Rated: A
The parent company of payday lender Speedy Cash has filed for a $100 million IPO. It plans to trade on the NYSE under ticker symbol CURO, with Credit Suisse listed as left lead underwriter. The Kansas-based company reports $33 million of net income of $442 million of revenue for the first half of 2017, and is owned by private equity firm FFL Partners.
Islands, Bodyguards, and Mansions – How would you spend $ 1 Billion? (NJ Online Casinos), Rated: B
Our new survey finds out the top 10 ways that people across America would spend their money if they won a $1 billion jackpot, including how many would buy a mansion, and how many wouldn’t give any to charity.
- 89% would give some to their close family
- 49% would pay off their debts as their first act
- 37% would give some money to their friends
- 28% would put $100 – $500 million into savings
- 28% would buy a mansion
Arcadia launches new online payment options (Drapers Online), Rated: B
The owner of brands including Topshop, Topman, Miss Selfridge and Dorothy Perkins has joined forces with payment provider Klarna to offer online customers the option of paying for goods 30 days after delivery, without being charged interest.
20% of millennials said they would feel less guilty if they were offered deferred payment options, while one in five were more likely to complete a purchase if they knew they could spread the cost over time.
RateSetter partners with Experian to boost business credit assessment (P2P Finance News), Rated: AAA
RATESETTER has teamed up with Experian to boost its credit decision-making process as it expands its commercial finance division.
Under the partnership, Experian is providing credit reference data and analytical services to RateSetter.
This has enabled the P2P lender to increase the number of business loan applications it processes each month from 150 to more than 600.
Nested Raises £36M in Third Round of Funding (Finsmes), Rated: AAA
Nested, a London, UK-based PropTech startup, raised £36m in its third round of funding.
The round was led by Global Founders Capital.
The company, which has raised almost £50m in total funding to date, intends to use the capital to expand its business reach, initially within London and in the near future expanding across the U.K.
TransferWise changes fees for GBP transfers, introduces complicated flat transaction fees (TechCrunch), Rated: AAA
Fintech startup TransferWise has built a solid reputation when it comes to transparency. The startup just announced new fees for transfers initiated from the U.K. And it’s quite hard to understand if transfers are going to be cheaper or not after the change.
TransferWise is switching from a simple variable fee to a flat transaction fee with a lower variable fee.
Let’s take an example. If you’re trying to transfer £1,000 from the U.K. to the Eurozone. With the old fee, you’d pay 0.5 percent (or the equivalent of £5) in fees. With the new fee, you now pay 0.35 percent + £0.80, which represents £4.30. You eventually get more euros.
For a £1,000, you now pay 14 percent less if you take into account all fees. But this percentage is going to change depending on your transfer.
Because of this tiny little flat transaction fee, you’ll now pay morethan before if you transfer less than £530.
This is even worse for GBP/USD transfers. If you transfer less than £800, you now pay more than before. But it’s now cheaper if you transfer more than £800.
Is an IFISA-inspired boom coming to the P2P sector? (P2P Finance News), Rated: A
THE PEER-TO-PEER Finance Association (P2PFA) has reported yet another quarter of increased lending among members in the sector, and the figures show just how beneficial ISA manager status can be.
P2P platforms offering Innovative Finance ISAs (IFISA) have previously said that most inflows have been coming in this tax year, and the latest P2PFA data shows just how much of a boost the fully regulated firms are getting.
Lending Works and Landbay, which both received full Financial Conduct Authority (FCA) authorisation and launched IFISAs at the start of this year both recorded some of the biggest increases in loanbook sizes and lenders.
The property loan fund that won’t surprise you with a lock in (Citywire), Rated: A
For LendInvest Real Estate Opportunities, a small Luxembourg-based fund run by the former peer-to-peer lending platform LendInvest, post-referendum it has provided an opportunity.
Assets in the fund have more than doubled to £130 million since the Brexit vote as investors have viewed its investments in short-term loans to property developers as a different way to get exposure to bricks and mortar.
The fund can be held in a self-invested personal pension (Sipp) but is not an eligible investment for an individual savings account (ISA).
The real estate fund has become a key focus for LendInvest as it has moved away from peer-to-peer lending after the Financial Conduct Authority (FCA) made it clearer what it thought P2P actually meant.
The fund lends to professional investors, developers and landlords who use their property portfolio as a prime source of income, transact several times a year and operate as a business.
‘He then went into discussions with the bank because he wanted to keep the asset and let it out, so refinanced. It had a valuation of £10 million, so 100% return in 10 months. We charged 15% interest.’
With interest rates that high it is not surprising perhaps that the fund has so far achieved its annual target of an 8% net return.
Accounting and business banking fintech raises €750k in seed round (AltFi), Rated: A
UK startup Countingup has raised €750,000 led by Frontline Ventures along with private investors to support sole traders.
Uniting business banking and accounting into a single product, Countingup aims to use the funding to build an accounting bank to serve 1m entrepreneurs.
Invest in property development from just £500 (This is Money), Rated: A
A new crowdfunding platform is allowing retail investors the chance to back residential property developments by investing as little as £500.
The start-up, called Homegrown, is giving individuals the chance to invest in developments – such as a converted milk processing factory that’s being turned into flats and offices – and claims projected annual returns of around 12 per cent over roughly two years.
HOW DO I… ACCESS BUSINESS FINANCE? (BQ), Rated: A
While credit conditions have continued to improve over the last 12 months there is still an issue for smaller businesses when it comes to the best finance options available and information on how to access them. There has been rapid developments in the different types of funding available to businesses, including peer-to-peer lending, crowd funding and business angel finance, but small businesses don’t always have the time to navigate around all the types of finance available.
Businesses can discover the funding options available to them including The Start Up Loans Company by using the Business Finance Guide (published by the British Business Bank in partnership with the ICAEW, and a further 21 business and finance organisations).
Whether you’re starting out or experiencing a high-growth phase, equity can be an important resource to provide finance as well as broader expertise. There is a breadth of equity funding options available, including the Northern Powerhouse Investment Fund, which provides early or late stage equity finance ranging from £50,000 to £2m.
At any stage of its development your business is likely to need a mix of different forms of debt, all of which have their advantages for business growth. The Northern Powerhouse Investment Fund offers microfinance covering micro-finance ranging from £25,000 to £100,000 and debt finance covering larger business loans £100,000 to £750,000.
London – Still The #1 FinTech Hub (Let’s Talk Payments), Rated: A
About 77% of UK businesses are aware of FinTech products and services and 65% have adopted at least one FinTech application, with a fifth (19%) taking on four. MarketInvoice, a London-based invoice financing firm found that these as result of using FinTech products and services, adopters reported saving (on average) over £5,500 a year.
London consistently attracts foreign direct investments (FDI) from around the world. Between 2006 and 2016, the capital has recorded investments from 67 different countries. The US, India, China, Japan and Spain together accounted for 56% of the investment. Of top source countries, the fastest-growing contributors to FDI into London are China, which has seen a tenfold increase over the last 10 years, Italy (+450%), and Canada (+400%).
Seven tips to help prepare to raise funds for your GP practice (Practice Business), Rated: B
1 Decide on equity or debt – or a combination
For example, if your business is already two-years old try Funding Circle.
Thirty per cent equity and 70% debt is a good ratio and can make the company easier to manage.
2 Test your financial model – it must be robust
3 Be realistic about your valuation
4 Decide on the appropriate people to approach
In the £1 to £5m area, try EIS/SEIS funds and VCT funds. This is where an expert adviser can be helpful in providing introductions and knowledge. For smaller amounts contact Angel Investors.
5 Make contact and ensure you follow-up
6 Prepare the right information for the right stage in the process
7 Take your team with you
Number of UK financial services trade marks surges due to fintech growth (Finance Feeds), Rated: B
According to data provided by professional services firm RPC, the number of trade marks registered by financial services firms has jumped 35% in five years – from 3,141 in 2011 to 4,228 in 2016.
Examples of fintech companies and challenger banks that have registered a number of trade marks recently include Atom Bank, Monzo, and Redwood Bank. Last year, the raft of fintech and financial services trade marks registered in the UK comprises names like “ Zentity” and “Numus Cash”.
One day in July, Carina Shi awoke to incessant phone calls by angry, loud men, seeking repayment on a 20,000 yuan loan taken out by a friend.
Unbeknown to Shi, the 20-year-old college student had been listed as the contact by a friend who defaulted on a loan borrowed from Qudian Inc, the Beijing-based online lender at the centre of the fourth-largest US initial public offering this year. Debt-collection calls only ceased after Shi called her friend’s mother in Inner Mongolia to resolve the debt.
Shi’s experience offers a glimpse into the inner workings of Qudian, a provider of micro loans that ballooned within three years into a sizeable lender offering a loans book of 38.2 billion yuan (US$5.6 billion) to 7 million active users during the first six months of 2017.
The annualised interest rate on 59.5 per cent of loans lent last year surpassed 36 per cent, according to the company. That compares with between 12 and 14 per cent among the country’s largest commercial banks.
That crackdown gave Qudian and other online lenders like Ppdai, Fenqile and Hexindai the niche to build a market, which expanded by 23 per cent in two years to 452.4 billion yuan at the end of last year.
Chinese overseas investors prefer tech stocks (Technode), Rated: AAA
China’s sizable middle class is on fire. A McKinsey & Company report projected that they would account for 76% of the country’s urban population by 2022.
When we say Chinese people are becoming increasingly tech-savvy, we don’t only refer to the fact they are the first adopters of cutting-edge technology software and voracious buyers of smart gadgets. We also have a knack and understanding for technologies to seek better investment returns. The report shows that tech stock is the most popular category for Chinese-speaking investors.
A dominating 56% interviewees said they have invested in Alibaba, which had a growth of nearly 80 percent since the start of this year. JD and Apple performed equally well to rank the second and third.
As digital natives, the country’s younger generations are first-movers to the sector. The report points out that post-80s gen represents nearly half (47.2%) of the users with post-90s gen comes as a close second (36.2%).
Over 65% of Chinese traders prefer Chinese companies when investing in the US.
Over 55% of Chinese investors will hold a position for over three months, and 20.03% for longer than a year.
The Role of Punctuation in P2P Lending: Evidence from the People’s Republic of China (Asian Development Bank), Rated: AAA
Using data from Renrendai, one of the largest P2P lending platforms in the People’s Republic of China, we investigate how the amount of punctuation used in loan descriptions influences the funding probability, borrowing rate, and default. The empirical evidence shows that the amount of punctuation is negatively associated with the funding probability and borrowing rate. We propose that the use of punctuation affects the readability of a loan description and reflects borrowers’ self-control and cognitive ability.
Download the full report here.
China’s Latest Fintech Offering Looks Overpriced (WSJ), Rated: A
Investors sent the stock of Chinese online microcredit company Qudian Inc. QD 7.00% —which literally translates as “Fun Shop”—up nearly 50% on its first day of trading on the New York Stock Exchange last week. But on Monday, following criticism of Qudian’s high lending charges in Chinese social media and newspapers, the stock tanked, dropping almost 20%.
The market does seem ripe for growth: Nonmortgage consumer loans are only around 20% of household deposits in China, according to Bernstein analysts.
Still trading at 6.6 times book value even after Monday’s share price tumble, Qudian is asking for a lot of faith compared with more-established lenders.
Chinese P2P lenders face IPO scrutiny (International Financial Law Review), Rated: A
Online lending companies are facing a number of issues when planning an initial public offering in Greater China and the US, according to panelists at last week’s IFLR Fintech Asia conference in Hong Kong. Regulators’ attitudes towards business models,
accounting requirements and risk reserves are issues companies need to be mindful of.
Credit Industry Leader Joins China Rapid Finance Board of Directors (PR Newswire), Rated: B
China Rapid Finance Limited (“China Rapid Finance” or the “Company”) (NYSE: XRF), one of China’s largest consumer lending marketplaces, today announced the appointment of Zhou Ji‘an, Executive Director and General Manager of China United SME Guarantee Corporation (“Sino Guarantee”), to its board as a non-executive independent director.
A seasoned chief executive in the financial industry, Mr. Zhou brings to the Company more than 18 years of experience in global organizations, financial institutions and government.
3 Advices For Peer-To-Peer Investors From ‘Inspeer’ Ceo (Coinidol), Rated: A
AltFi Data Analytics, published by investment bank Liberum, shows that the ratio of operating costs to the loan portfolio at the crowdlending platforms is lower by almost 40% comparing to banks.
- Diversification is a key
- Know your borrower
- Pay attention to risks
Australia publishes draft laws for relaxed fintech regulation (Reuters), Rated: AAA
The Australian government published draft laws on Tuesday that would let financial technology companies operate without a full licence, a measure it said would encourage innovation without compromising existing levels of consumer protection.
Financial technology companies would be able to test products involving non-cash payments, crowdfunding, consumer credit and provide financial advice on pension funds, life insurance and domestic and international securities.
Adopt digital to retain industry fund members (Super Review), Rated: A
Industry superannuation funds need to adopt digital advice into their offering to retain those members who eventually seek advice elsewhere and inevitably leave their industry fund.
Through digital advice, super funds should begin focusing on what Cheung terms as “incremental advice”.
Instead of providing just intra-fund and single-issue advice, super funds should provide members with the ability to deal with cashflow, debt management, or protection and insurance needs, as needed.
Fintech Valley Vizag and Knowledge Partner KPMG Announce Finackathon 2017 (BW Disrupt), Rated: AAA
HackerEarth, a leader in innovation and talent management software, has been selected by Fintech Valley Vizag – a Government of Andhra Pradesh initiative, to host Finackathon 2017.
The hackathon will be held in two stages. The idea phase which began on September 14th is currently underway with entries set to close on October 30th. The shortlisted teams will participate in the final round to be conducted in the first week of December in Visakhapatnam. The winning teams in each category (Banks, Insurance, Capital Markets, and NBFCs) will be awarded a sum of INR 3,00,000. The winners will also be given a chance to carry out Proof of Concept (PoC) with corporates and will need to be executed in Fintech Valley Vizag. Investor network of The Fintech Valley, Vizag will be invited for Hack Day, where they will go through the prototyped solution.
The hackathon is looking for solutions across the following 5 themes:
- Customer Experience
- Process Automation
- Financial Inclusion
- Risk Management
Betterpaydayloansonline.com Now Allows Getting Quick Payday Loans (MENAFN), Rated: B
Betterpaydayloansonline.com is a web-based service, which makes it possible to get quick, safe and convenient payday loans with no hassle at all.
LENDING LOOP HITS MILESTONE OF PROVIDING $ 10 MILLION IN FINANCING (Betakit), Rated: AAA
Lending Loop, a Canadian P2P lending platform, has officially provided financing of more than $10 million across the country.
The company says it has supported the expansion of over 180 small businesses through a system that allows investors to reach out to small businesses on Lending Loop’s digital marketplace.
Lending Loop’s investment model moves away from institutional or accredited investors; Canadians can even invest $50 into a pool of larger loans.
A new service is helping employers reduce turnover by paying their employees by the day (The Washington Post), Rated: A
Restaurant News reports that hourly employees can use a smartphone app to access money for hours worked and have it deposited on a debit card. The amount is limited to 50 percent of what’s earned and–to discourage impulse buying–employees only have an hour after their shift to access the money. There’s no fee for the worker, but businesses pay Instant Financial $1 per active user per month.
Barha is aiming to put a dent into the burgeoning payday loan industry, which was used by approximately 12 million Americans in 2015. His service is also being looked at as a potential recruiting and motivation tool by employers, particularly in — but not limited to — the retail and restaurant industries.
According to a recent USA Today report, almost 150,000 employees at more than 50 companies like McDonalds, Outback Steakhouse and Dunkin’ Donuts as well as other restaurants and retailers, trucking companies and staffing firms have access to the service.
GDS Link Joins Canadian Lenders Association to Support Innovative Lending; Sponsoring Canadian Lenders Summit (PRWeb), Rated: B
GDS Link, a global provider of risk management solutions and consulting for multiple verticals within the financial services industry including marketplace lending, retail finance, alternative financial services, credit card, auto, and business lending and leasing, today announced that it has joined the Canadian Lenders Association (CLA) as an affiliate member and will be sponsoring the Canadian Lenders Summit.
GDS Link is sponsoring the Canadian Lenders Summit, which has partnered with the CLA. The inaugural event will take place on October 26, 2017 in Toronto, Canada. Representing GDS Link is Rich Alterman, EVP of Business Development.
Brazilian fintech Nubank offers accounts for transfers, payments (Reuters), Rated: AAA
Brazilian startup Nubank said on Tuesday it would expand from credit cards into digital accounts allowing users to make transfers, pay bills and earn more interest than average savings account, beefing up its challenge to traditional banks.
Tech-savvy millennials have been the core demographic for Nubank’s credit card, but Velez said he hoped new accounts would serve some of the roughly 60 million Brazilians – around 30 percent of the population – who do not have a bank account.
Venture capital firms including Sequoia Capital, Kaszek Ventures, Tiger Global Management and DST Global have invested $179 million in Nubank since 2013, giving it a value of $500 million in early 2016 that made it the largest Brazilian fintech startup.