Thursday June 20 2019, Weekly News Digest

ASIC borrowers

News Comments Today’s main news: LendingClub expands borrower program. Funding Circle forced to narrow range of valuation. Yirendai revenues come from haircut loans. Chinese P2P lenders explore southeast Asia. Borrowell passes 1M members, raises $20M. Today’s main analysis: 5 ASIC findings on marketplace lending. Today’s thought-provoking articles: US Core, inflation ease. Fintech lending algorithms discriminate […]

The post Thursday June 20 2019, Weekly News Digest appeared first on Lending Times.

ASIC borrowers

News Comments

United States

United Kingdom

China

Other

News Summary

United States

LendingClub Expands Program to Help Borrowers Actually Pay Off Debt (Lend Academy), Rated: AAA

LendingClub shared a few stats on borrowers who choose this method:

  • Save an average of nearly $900 over the course of their loan
  • Cut their credit card interest rate nearly in half
  • Increase their credit score in just three months

The product has been tested for over a year and LendingClub is working with a partner network of over 1,700 credit card, bank and loan companies to make the process seamless. What’s interesting is borrowers can add up to 12 creditors per loan which is an important feature since borrowers often hold balances across many cards.

Turning Lending Club’s Worst Loans into Investment Gold (Towards Data Science), Rated: A

This is a writeup of a machine learning project I completed. In this post I hope to:

  • Describe my algorithm for predicting loan defaults.
  • Use the algorithm to construct a portfolio of clean loans

Inflation Miss (PeerIQ), Rated: AAA

US Core CPI rose by 2% YoY in May, just at the Fed’s target rate but below economists’ expectations. Consistently low inflation is boosting calls for a rate cut next week. The market is pricing in a 24% probability of a rate cut next week and a 76% probability of a rate cut in September.

Source: Bloomberg, PeerIQ

Fintech algorithms discriminate 40% less than traditional lenders (Quartz), Rated: AAA

Algorithmic fintech lending is less discriminatory against minorities than traditional loan officers, according to a recent study of US mortgages. The findings signal hope that technology could provide financing that’s more fair, but the research also underscores how widespread discrimination remains.

The US housing market has long been prejudiced against minorities. When Latino and Africa-American borrowers are looking to buy a home, they usually end up paying 7.9 basis points (0.079 percentage points) more than whites to take out the mortgage, and 3.6 basis points more when they refinance the debt, according to a National Bureau of Economic Researchworking paper published this month.

Buttigieg worries tech may add racial bias to credit decisions (American Banker), Rated: A

Pete Buttigieg said the way credit scoring is done in the U.S. is fraught with inequality and he’s worried the process may get worse with systems based on artificial intelligence.

Commercial Real Estate Crowdfunding Eyes ’18-Hour Cities’ for Small Investors (The Street), Rated: A

When Clear Point Gardens, a 604-unit apartment complex in Columbus, Ohio, recently changed hands, it produced a nearly 43% gain in 16 months, an amazing windfall for investors in the deal.

All 68 of them.

The sale of Clear Point, financed with help from investors on CrowdStreet’s online platform, is the latest example of how online syndication is revolutionizing the way deals are financed in the $6 trillion commercial real estate market.

HSBC launches digital mortgage platform with help from Roostify (HousingWire), Rated: A

One of the world’s largest banks is about to join the digital mortgage revolution, as HSBC Bank USA, the U.S. arm of HSBC Group, announced that it is partnering with Roostify to launch a digital mortgage platform.

Mirador’s Trevor Dryer: ‘The world doesn’t need another high price lender’ (Tearsheet), Rated: A

Trevor started Mirador to fill this void of bank-originated small business lending. We talk about why he started Mirador with a lending as a service model and what painpoints he was addressing.

Dave is launching a checking account that helps users build their credit score (Business Insider), Rated: A

The Los Angeles-based company, backed by investors including Mark Cuban, the DJ Diplo, and hedge fund Mark 2 Capital, said on Tuesday it’s rolling out a new checking account product that reports all rent payments to credit agencies. The new feature, added to Dave’s original app, helps customers to build their credit. Dave plans to begin reporting utility payments later this summer.

CoreLogic Launches Marketrac Platinum (CoreLogic), Rated: A

With Marketrac Platinum, lenders and title companies can utilize the interactive platform to identify top performing real estate agents and brokerage firms to prioritize professional relationships based on market trends.

Zirtue Revolutionizes Peer-to-Peer Lending (IT Business Net), Rated: A

Sprout Mortgage Launches ACORN Automated Underwriting System (Yahoo! Finance), Rated: A

Sprout Mortgage, the innovative force in Non-QM lending, today announced the launch of its ACORN automated underwriting system (AUS) as part of an ongoing effort to deliver value-added services to its third-party origination clients.

Finicity Integrates with LendingQB to Optimize Mortgage Origination Process (PR Web), Rated: B

Finicity announced today an integration with LendingQB. LendingQB’s platform now uses Finicity’s digital Verification of Assets (VoA) solution to allow lenders to free up resources, increase processing speed and reduce mortgage fraud while providing borrowers with a more efficient and positive experience.

Cardholders Seek to Capital-ize on Madden (The National Law Review), Rated: A

Last week, three Capital One cardholders filed a putative class action in the Eastern District of New York, Cohen v. Capital One Funding, LLC,1 alleging that the rates of interest they paid to a securitization trust unlawfully exceed the sixteen percent threshold in New York’s usury statutes.  The Plaintiffs seek to recoup the allegedly excessive interest payments and an injunction to cap the interest rates going forward.

Fundbox Tapped By Top B2B E-Commerce Software Provider OroCommerce to Power Net Terms (Fundbox Email), Rated: A

According to a 2019 research study by

Cross River poaches execs from student refinancing firm Laurel Road (American Banker), Rated: A

Cross River Bank, a Teaneck, N.J.-based bank that focuses most of its energy on supporting fintechs, is hiring several people from the student loan refinancing company Laurel Road to its capital markets team.

Cross River’s fintech partners include Affirm, Circle, Best Egg, Coinbase, Rocket Loans, Stripe, Upstart and Transferwise.

Optimizely Closes $ US105M Financing Round (Which-50), Rated: A

Optimisation platform Optimizely has closed US$105 million in financing, including US$50 million in Series D funding. The funding, led by Goldman Sachs Private Capital Investing, also included Accenture Ventures.

Austin Niemiec Named New Executive Vice President of Quicken Loans Mortgage Services (Yahoo! Finance), Rated: B

Quicken Loans Mortgage Services (QLMS), the second largest mortgage lender serving the needs of brokers, regional banks and credit unions, today announced that Austin Niemiec has been named Executive Vice President.

Self Lender Awarded Inaugural Inclusive Fintech 50 (PR Newswire), Rated: B

Self Lender is pleased to announce its inclusion in the inaugural list of winners of the Inclusive Fintech 50. The Inclusive Fintech 50 is a competition launched in February to help early-stage fintech companies attract capital and resources to benefit the world’s 3 billion financially underserved people. The competition was organized by MetLife Foundation and Visa Inc., with global nonprofit Accion and World Bank Group member IFC.

United Kingdom

No sign yet of breaking out of circle (The Times), Rated: AAA

The early days of a company’s life on the stock market tends to set the tone for what follows. The grief around Funding Circle’s listing began even earlier and has continued to plague it.

Days before trading in shares of the specialist online lender began at the end of September, Funding Circle and its bankers were gunning for a valuation of up to £1.75 billion, only to be forced to narrow the expected range shortly before it came to market, and then to price the shares at the lower level of 440p apiece.

Source: Refinitiv

Three Biggest Overperformers And One Underperformer In Peer-To-Peer Lending (4th Way Email), Rated: AAA

Landbay

  • Over £300 million lent.
  • Maximum loan size to property valuation (LTV) 80% – better than all the major high-street banks.
  • Average LTV: 72% – highly suitable for these kinds of mortgages.
  • Average rent: 190% of the monthly mortgage payment.
  • Over 90% of mortgages are to experienced and professional landlords.
  • Reserve fund: 0.6% of outstanding mortgages – modest but useful.
  • Type of lending: residential BTL.
  • Typical risk of this type of bank lending: very low.
  • P2P bad debts: none.
  • Interest rate: 3.54% after expected bad debts.

Proplend

  • £65 million lent.
  • Maximum loan size to property valuation (LTV) 75% and investors can choose to limit to 50% – lower than all high-street banks.
  • Average LTV  60% – highly suitable for these kinds of mortgages and loans.
  • Minimum rent on rental properties usually 110% of the monthly mortgage payment.
  • Type of lending: residential and commercial rented properties up to five years; some development lending; a mix of senior and junior debt (junior means other lenders get repaid first if the borrower’s property has to be forcibly sold to repay the loans).
  • Typical risk of this type of bank lending: low to moderate for shorter-term rental properties; moderate to high for developments and junior debt.
  • P2P bad debts: none.
  • Interest rate: 7.32% to 9.43% after expected bad debts (7.32%-12.13% before bad debts).

CrowdProperty

  • £35 million lent.
  • Maximum loan size to property valuation (LTV) 70% and investors can choose to limit to 50% – lower than all high-street banks.
  • Average LTV  61% (against starting value of property) – very low for these kinds of loans.
  • Type of lending: property development lending.
  • Typical risk of this type of bank lending: moderate to high.
  • P2P bad debts: none.
  • Interest rate: 8% after expected bad debts (7.32%-12.13% before bad debts).

Rebuildingsociety – the Underperformer

  • £15 million lent.
  • Type of lending: unsecured small business lending to sub-prime.
  • Typical risk of this type of bank lending: moderate to high.
  • P2P bad debts: 17% of total lent in pounds
  • Interest rates: estimate an average 5% after heavy losses.

British Business Bank adds £60m firepower to non-bank lender (AltFi), Rated: A

Simply, a non-bank lender, focused on SME asset financing has scored a a third financing tranche of £60m from the British Business Bank.

One fifth of UK investors upping exposure to debt investments (Investment Week), Rated: A

One-fifth of UK investors are increasing their exposure to debt amid low interest rates and Brexit uncertainty, according to research from FJP Investment, which found this number climbs to 34% when 18-to-35 year-olds are considered in isolation.

However, the independent survey – which comprises 950 investors – discovered 44% of participants are more focused on short-term debt investments over this financial year due to both political and economic uncertainty; this figure rose to 68% among under 35s.

OakNorth completes loan to Oncore IT for the acquisition of Fuse Technologies (Fintech Finance), Rated: A

OakNorth – the bank for entrepreneurs, by entrepreneurs – has provided a loan to Oncore IT, a managed service and cloud platform provider.

The finance has been used for the acquisition of Fuse Technologies, a London based provider of unified communications tools.

Brexit and drive for growth sees IT fintech salaries surge (AltFi), Rated: A

London-based java developers lead the pack, commanding starting salaries of up to £60,000, followed by software developers in the capital on up to £55,000.

Intense competition between UK-based fintechs – lead by Revolut, TransferWise, OakNorth and Funding Circle – and high street banks attempting to upgrade their services has led to bidding wars in order to gain top level IT professionals, said the report called The UK Fintech Revolution.

Lloyds first to launch open banking app for credit cards and savings (Fintech Futures), Rated: A

Customers of Lloyds Bank, Halifax and Bank of Scotland are the first to see their savings accounts and credit cards in one place, thanks to open banking technology, reports Jane Connolly.

J.P. Morgan working on a secretive digital banking project based out of London (TechCrunch), Rated: A

A number of incumbent banks are known to be developing new digital-first products in a bid to keep the new wave of challenger banks at bay and now it appears that the latest to make that move is J.P. Morgan.

According to sources, the investment bank has begun recruiting for a secretive skunkworks project within London’s booming fintech industry. Very few details are known about what exactly J.P. Morgan plans to build, although TechCrunch understands the bank is busy hiring high level developers with full-stack and cloud-based dev skills for the new project, along with other personnel.

Following Facebook’s Libra launch, UK regulator hints at greater Big Tech scrutiny (AltFi), Rated: A

The FCA says technology is dramatically changing the markets it regulates and blurring regulatory boundaries in a new report into its activities.

China

Yirendai Revenues Come From Suspect Haircut Loans (Seeking Alpha), Rated: AAA

Over 60% of YRD’s FY 2018 revenues stem from “haircut loans” (P2P service fees charged to borrowers) that are prohibited by Chinese regulation. Recent developments in the P2P lending sector with regards to questionable lending practices, unethical collections, and usury are not being disclosed in YRD’s SEC filings, leaving U.S., Canadian, and international investors completely in the dark.

The Chinese P2P Lending Market

Unlike in developed countries, there are no administrative bodies (such as the U.S. Securities Exchange Commission) which regulate peer to peer lending exchanges in China. Instead, such services are regulated by self-organized internet associations and retail banks. The lack of meaningful oversight has caused the Chinese P2P lending market to bubble into $178.9 Billion in FY2018, almost 22 times the size of the P2P lending market in the United States and 447 times that of Japan’s.

Over 850+ fraudulent/ponzi lending platforms were exposed in FY 2018 alone.

Source: iiMedia Research

But the bad numbers don’t end here:

– The total loan volume amounted to 245.9 billion in Q12019, down -55.5% Y/Y.

– 85.7 in new loans were lent in March 2019, down -53.5% Y/Y.

– Principal balance of all loans: 8,029 CNY billion, down -3.6% Y/Y.

– sum of P2P lenders and borrowers, up 21%.

Chinese P2P lending platforms look to Southeast Asia amid industry purge back home (Technode), Rated: AAA

A slew of Chinese fintech and peer-to-peer (P2P) lending platforms are looking to more lenient markets in Southeast Asia (SEA), following a prolonged industry crackdown in China that has left the sector reeling.

Over the past year, China’s regulatory clampdown on risky financial practices has wiped out more than half of the country’s P2P lending platforms. As of May, just 900 survived, down from almost 1,900 recorded a year ago.

In early June, Indian daily newspaper the Economic Times reported that Chinese fintech companies, including WeShare, 9F Group, and CashBUS, are exploring investment opportunities in the country’s burgeoning online lending sector, particularly in the P2P lending space.

XW Bank Welcomed by IMF as One of 6 Outstanding FinTech Companies From China (Yahoo! Finance), Rated: A

The International Monetary Fund (IMF) welcomed 6 outstanding FinTech companies from China including Ant Financial, WeBank and XW Bank.

European Union

Snask helps Klarna to communicate its ‘smooth’ banking offer with off-the-wall film and photography (Creative Boom), Rated: A

When Stockholm studio Snask was approached by Klarna, one of Europe’s biggest banks, to help communicate how its revolutionary payment solutions make life easier for its customers, it set out to create seven “never-seen-before” worlds.

LHV Bank Integrates Estateguru Investments in Online Banking Dashboard (P2P-Banking), Rated: A

You might wonder why that is relevant as most readers are unlikely to be LHV Bank customers. LHV Bank is a bank in Estonia.

I think it is highly interesting, as it is – to my knowledge – the first time a bank has integrated p2p lending investments in its customer interface. So the LHV bank customers, not only see their accounts and stock depots, but also their Estateguru investments conveniently listed in their online bank dashboard. Much has been talked about what role could banks have in p2p lending (mere transaction banks? providing credit lines?) and also there is a lot of speculation if PSD2 (open banking) will help fintechs to seize the access to the customer from banks because they could control the user interface in the future. But this is actually a first step a bank takes in the opposite direction. By aggregating “non-bank” information inside the dashboard, they aim to make the banking interface more useful for the customers.

International

How Klarna is Helping the World Shop Like a Queen (Power Retail), Rated: AAA

Klarna is the latest Buy Now Pay Later (BNPL) app to sweep through the world. Originating in Sweden, the BNPL platform allows users to purchase goods and schedule repayments in timeslots. At this point in time, Klarna is the first and only BNPL platform that’s available in the U.S. It’s also available in the UK, Denmark, Norway, Belgium and many other European countries.

Australia

Five key ASIC findings on marketplace lending (Cuffelinks), Rated: AAA

In April 2019, the Australian Securities and Investments Commission (ASIC) released its third report on marketplace lending, the Survey of marketplace lending providers: 2017–18The report paints a clear picture of a once-nascent industry enjoying growth with new borrowing increasing by nearly 45% in the 2017-18 financial year. The report notes that this growth is moderating compared to the near doubling in funds borrowed the previous year (from $156 million to $300 million). By contrast, the Australian Bureau of Statistics (ABS) reports that overall personal lending has declined by an astonishing 24% in the 12 months to March 2019.

Source: Cuffelinks

The ASIC report found that the average interest rate charged for marketplace loans entered into during the 2017–18 financial year was 11.5%, up from 10.5% in the 2016–17 financial year.

Source: Cuffelinks
India

All you need to know about P2P lending and Commodities (India Times), Rated: AAA

Vinay Mathews, Founder and COO, Faircent and Sanjay Gakhar, Vice President, MCX talks about the benefits of investing via the P2P platform and Commodities, ET Wealth investment Workshop in Delhi Listen in!

Watch the video here.

Asia

Indonesian firms turn to P2P lenders for funds (Asia-First), Rated: AAA

Small companies in Asia-Pacific are tapping new funding sources, according to the Economist Intelligence Unit (EIU) study commissioned by Mastercard, with peer-to-peer (P2P) lending platforms in Indonesia reportedly posting USD1.4bn worth of transactions in 2018, an increase from USD20m in 2016.

Canada

Borrowell passes one million members, raises $ 20 million in new capital (Zone Startups), Rated: AAA

RFI alumni company Borrowell announced that it had reached significantly more than a million users, making it Canada’s largest consumer fintech company by that measure.

In addition to this membership milestone, Borrowell also confirmed that it has received $20 million in Series B funding.

AltFi Toronto Summit 2019 (AltFi), Rated: B

WED, 9 OCTOBER 2019, 08:30 – 17:30 EDT

Blind Bird tickets are now on sale at a 50% discount ahead of the Summit’s agenda being announced later this Summer.

Authors:

George Popescu
Allen Taylor

The post Thursday June 20 2019, Weekly News Digest appeared first on Lending Times.

Thursday April 11 2019, Weekly News Digest

china p2p lending

News Comments Today’s main news: Lending Club loans $159M in the past week. OnDeck offers same-day funding. Kabbage secures $700M in funding. RateSetter ISA passes 200M GBP in subscriptions. Funding Circle CEO pocketed 4M GBP last year. Klarna launches global customer authentication platform. Today’s main analysis: Drivers of global growth in FSB’s shadow banking. (A […]

The post Thursday April 11 2019, Weekly News Digest appeared first on Lending Times.

china p2p lending

News Comments

United States

United Kingdom

European Union

China

Other

News Summary

United States

Need a loan for Tax Day? According to Lending Club data, you’re not aloan… er, alone (Thinknum), Rated: AAA

As seen in data from Lending Club ($NYSE:LC), there is a cyclical spike in the number of loans, as well as the money needed by those needing loans, right around the end of tax season. While this finding may seem pretty clear without any data, it essentially confirms an adage in the lending industry.

RIght now, there was only $21.5 million loaned out to lendees from April 8 to today. This past week, there was about $159 million worth of all sorts of loans — personal, mortgage, etc. — loaned out by the platform.

Lending Club Total Principal Loaned (Weekly)

ONDECK OFFERS SAME DAY FUNDING TO EMPOWER SMALL BUSINESS (OnDeck), Rated: AAA

OnDeck today announced that it will offer to fund and debit customer bank accounts with Same Day ACH transfers, eliminating a decades long pain point for small business owners accustomed to the traditional ACH transfer process, which can take multiple days and lacks certainty on when the transactions will hit bank accounts.

Same Day ACH transfers from OnDeck provide qualified OnDeck Term Loan and Line of Credit customers with funds up to the National Automated Clearing House Association (NACHA) cap of $25,000 by 5:00 pm local time on the same business day the customer books or makes a draw on their line of credit.* Qualified customers are also debited via the same day ACH service, providing them additional predictability in transaction clearing times and offering better clarity around day-to-day cash flow management.

Highlights from Jamie Dimon’s Annual Letter (PeerIQ), Rated: AAA

US payrolls rose by 196 k in March and the unemployment rate remained at 3.8%.

Source: Bloomberg, PeerIQ

Highlights from Jamie Dimon’s Letter to Shareholders

Jamie Dimon published his annual letter to shareholders. We look at some highlights below:

  • The banking system, and JPM in particular, is over-capitalized – Under the Fed’s most extreme stress-testing scenario, where 35 of the largest American banks bear extreme losses (as if each were the worst bank in the system), the combined losses are about 6% of the total loss absorbing resources of those 35 banks.
Source: JPM, PeerIQ

PM is investing billions in technology to compete – the cloud, AI, ML and digital banking

  • JPM customers can now open a bank account online in under 5 minutes and can reduce their mortgage closing times to 3 weeks.
  • The bank now has 49 Mn active digital customers, including 33 Mn active mobile customers
  • JPM is looking at fintechs in the US and in China as not just opportunities but also looming competition.

Online lender Kabbage rakes in 0m funding (Verdict), Rated: AAA

Kabbage, an online lender for small businesses, has fetched $700m in asset-backed securitisation (ABS) funding.

With the securitisation, the company’s debt funding increases to $940m.

Real-time data was Kabbage’s secret sauce, its first investor says (American Banker), Rated: A

The firm started life as a small, scrappy fintech startup in Atlanta in 2008, but has grown rapidly. It made $2 billion worth of loans in 2018 and more than $600 million in the first quarter of 2019. It also recently agreed to provide financing at the point of sale on Alibaba.com as part of a program called Pay Later.

Upstart Raises $ 50 Million and Announces New Bank Partners (Lend Academy), Rated: A

One of the big announcements on day one of LendIt Fintech USA 2019 is from consumer lender Upstart. They have announced a $50 million equity raise as well as three new partners for their “Powered by Upstart” banking as a service program. Oh, and they are getting into credit cards.

PeerStreet Lowers Minimum Real Estate Investment to $ 100 (Think Reality), Rated: A

The burgeoning peer-to-peer lending platform PeerStreet has unveiled product updates that enable investments of only $100.

The company recently announced it’s lowered the minimum investment to $100 for “small balance reinvestments” when using its automated investing product. The upgrade also expands the investment types available for automated investing to include cash offer loans and 30-day notes, which offer shorter terms than typical bridge loan investment options, the company said.

Sharestates Wins Top Real Estate Platform Award at LendIt Fintech USA 2019 (PR Newswire), Rated: A

Sharestates, a marketplace lending platform that connects real estate developers with investors, was crowned Top Real Estate Platform at LendIt Fintech USA2019 in San Francisco, California on April 9, 2019. The Top Real Estate Platform award is based on performance, volume, growth, product diversity, and responsiveness to stakeholders.

Now operating in 46 states, Sharestates offers diversified asset classes including residential, multi-family, mixed-use, commercial properties, and land acquisitions.

Since launching in 2015, Sharestates has closed on over $1.7 billion in total loan volume and returned over $675 million in principal to investors. Average annualized returns have exceeded 10% every year. As a result of its strong performance and valued relationships, 82% of Sharestates loan volume has come from repeat borrowers and 81% of its investors are repeat investors.

The stREITwise Platform Brings Real Estate Investment to All (Realty Biz News), Rated: B

The company has just announced a new acquisition to its investment portfolio, a $32 million mixed-use building in Carmel, Indiana, one of the most affluent suburbs of Indianapolis. The 140,000-square foot Allied Solutions Building, already around 87 percent leased, stands poised to increase dramatically in value thanks to its location in the heart of downtown Carmel in the heart of a busy mixed-use development surrounded by restaurants, coffee shops, fast-casual dining, service-oriented retail, and the locally renownedSun King distillery and food hall right next door.

13 cities where renting is cheaper than buying a home (AOL), Rated: A

Americans’ homeownership rate is 64.8%, according to the latest U.S. Census data.

Following are the 13 metros where renting is cheaper by more than $150 a month, beginning with cities with a smaller advantage for renters.

BlueVine Adds Term Loan to Suite of Online Working Capital Solutions to Fuel Small Business Growth (GlobeNewswire), Rated: A

BlueVine, which provides small- and medium-sized businesses with access to fast and simple online financing, announced that it is making term loan financing available for business owners through its suite of online financing solutions. The BlueVine Term Loan provides small- and medium-sized business owners with fast and simple access to financing to grow their businesses through BlueVine’s advanced online platform. More than 59 percent of businesses are looking for funds to grow their business, according to the 2017 Federal Reserve Small Business Credit Survey Report on Employer Firms. With a BlueVine Term Loan, business owners can quickly pursue larger projects and investments to bring their businesses to new heights.

Aura Approves 350,000th Affordable Loan (Bakersfield.com), Rated: A

Aura, a mission-driven financial technology company that offers affordable loans to hard-working families, this week approved its 350,000 th loan.

Since its launch in 2014, Aura has provided more than $437 million in credit-building loans to borrowers at approximately 1,200 partner locations using technology that enables local businesses to administer loan applications. Currently, Aura’s average loan size is around $1,600.

In total, Aura has raised over $403 million in social bonds across 21 bond issuances. The most recent issuance was in March for $50 million.

What Kind of Collateral Do I Need for a Business Loan? (Nav), Rated: A

Before you can qualify for a commercial loan, you’ll need to prove that doing business with your company is a good risk. This means you’ll need to pass successfully through a lender’s qualification process.

Next Wave of Personal Loan Growth May be Driven by Prime and Above Consumers (MarketWatch), Rated: A

The prime and above risk tiers have become a greater focus for lenders in recent years. Nearly two-thirds of unsecured personal loan balances originated in the first three quarters of 2018 were lent to prime and above consumers. FinTechs drove this shift as originations for prime and above grew to 62% in 2018, up from 52% in 2013. While still less conservative than banks, FinTechs’ overall risk profile for originations now aligns tightly with credit unions. At the end of 2018, FinTechs held the majority share of personal loan balances with 39%, while banks and credit unions followed with 28% and 21%, respectively.

Student Debt Isn’t Just An Employee Problem — It’s Also An Employer Problem (Killer Startups), Rated: A

The Federal Reserve Bank of New York reported in its Quarterly Report on Household Debt and Credit for the fourth quarter of 2018 that outstanding student loan debt increased to $1.46 trillion, which is $15 billion more than the previous quarter. It also reported that student loan debt rose by $79 billion in 2018.

The student debt load isn’t just impacting the individual students who enter the workforce, hoping they can find a job that enables them to make those monthly payments. I’s also slowing economic growth. A January 2019 Federal Reserve paper noted that young adults report their student loan debt is the reason they’re unable to buy a home. The same report also cited other research concluding that 20 percent of the decline in homeownership among young adults relates to student loan debt that’s been rising since 2005.

Amount Announces Cloud-Based Account Verification Platform (Kake), Rated: A

Amount today announced AmountVerify, a cloud-based platform for risk management across financial products. AmountVerify marks the first time industry leading fintech provider Avant is making a component of its cutting edge online lending platform available to financial service companies as a standalone product through Amount.

Onfido raises $ 50M to create the Identity Verification Standard for Businesses Globally (Markets Insider), Rated: A

Onfido, the global identity verification provider, today announced it has raised $50M in funding, bringing the total investment in the company to over $100M. The round was led by SBI Investment and Salesforce Ventures, with support from M12 (formerly Microsoft Ventures), FinVC and others, including existing investors.

Forward Financing Expands Capital Base with $ 90 Million Credit Facility (Yahoo! Finance), Rated: A

Forward Financing has closed on a $90 million credit facility, consisting of a $60 million senior revolving credit facility and a $30 million junior term loan. AloStar Capital Finance (“AloStar”), a division of Cadence Bank, N.A., served as the Agent on the senior facility.

Credibly Announces Investment Grade Senior Debt Offering (Yahoo! Finance), Rated: A

Today, Credibly announces the next phase in its balance sheet growth strategy with a $10 million Investment Grade-rated senior debt offering. The transaction closed on March 28, 2019.

Mitek Expands Auto-Capture User Experience Across All Digital Channels with the Addition of Desktop (GlobeNewswire), Rated: A

Mitek today announced it has upgraded its desktop browser experience to support auto-capture so customers can rapidly verify the identity of applicants across all digital channels: desktop browsers, mobile web and native applications.

According to Javelin Research, today only one third of users (34 percent) still complete the entire account opening process on their desktop.

MiSnap delivers a superior auto-capture experience for desktop and across mobile devices through:

  • Guided commands:  Real-time commands such as where to place a document in relation to the camera or detection of glare on the ID document are some of the conditions evaluated in order to help the user capture an optimal image, which improves image acceptance rates and reduces capture retries.
  • Advanced image analysis: Once MiSnap has achieved an optimal capture of the ID document, the software then further analyzes the image and makes the necessary adjustments in order to process all images consistently and accurately.
  • Modern architecture: Because MiSnap uses WebAssembly, it can perform at native speeds and is easy to integrate into customers’ web-based apps and requires minimal footprint.

58% of lenders will use AI in next two years (AI Foundry Email), Rated: A

Fannie Mae recently put out a 

  • Nearly two-thirds of lenders are familiar with AI
  • But, only 27% are using it in their businesses now, and…
  • Only half of that group are currently using it with customers (the rest are doing trials)
  • However, looking ahead two years – 58% of lenders expect to use AI/ML in their mortgage business.
  • Of the rest:
      • 22% predict they’ll be investigating AI
      • 19% foresee being in a “wait and see” mode

    These data points show us that “prime time” is coming soon for AI/ML in mortgages. 

    Fintech alone won’t be enough to boost credit union mortgage volumes (Credit Union Journal), Rated: A

    How can credit unions, especially small institutions, compete with Quicken Loans’ Rocket Mortgage “Push button, get mortgage” campaign?

    They can’t – and, sources said, they shouldn’t try.

    GROUNDFLOOR Wins 2 FinTech Awards (Groundfloor Email), Rated: B

    GROUNDFLOOR was named Best Crowdfunding Platform by the 

    Pulte Mortgage and Finicity Partner to Combat the Home Loan Paper Chase (MarketWatch), Rated: B

    Pulte Mortgage announced today it is partnering with Finicity — a leading provider of real-time financial data access and insights, to provide its borrowers with a faster, simpler and more secure way to navigate the home financing process.

    Hudson Data and LendingPoint partner to prevent Synthetic ID fraud (Finanzen), Rated: B

    Hudson Data and LendingPoint announced that they are partnering to create an industry solution to prevent synthetic identity fraud using powerful graph machine learning.

    Dharma crypto lending platform officially goes live (CoinGeek), Rated: B

    Dharma Labs completed a Series A funding round earlier this year to support its cryptocurrency lending platform project. The San Francisco-based company raised $7 million from companies such as Polychain Capital, Coinbase Ventures and others and, if there was any concern about the platform not going live, those concerns are now extinguished. Dharma announced this past Monday in a Medium post that the platform is now live.

    United Kingdom

    RateSetter ISA Milestone: Passes £200 Million in Subscriptions (Crowdfund Insider), Rated: AAA

    UK-based peer-to-peer lender RateSetter recently announced its ISA has now passed the milestone of attracting £200 million in subscriptions.

    “Investors have enjoyed an average annualised return of 4.5%, tax-free of course, since the RateSetter ISA launched in February 2018. The average RateSetter ISA balance stands at £11,000.”

    Funding Circle boss pocketed more than £4m last year (P2P Finance News), Rated: AAA

    FUNDING Circle founder Samir Desai (pictured) earned more than £4m last year, having cashed in some of his shares at the time of the peer-to-peer lender’s stock market flotation.

    Desai took home a salary of £210,000 last year, according to Funding Circle’s annual report, a four per cent increase from his salary of £202,000 in 2017.

    The majority of his total remuneration of £4.081m came from cashing in share options.

    Zopa rewrites outdated money idioms (The London Economic), Rated: AAA

    Each future-looking idiom challenges the status quo. For example, according to Zopa, the ‘signing for the bill’ gesture will be redundant soon. Instead, when people have finished their meal, people will be more likely to signal facial or iris recognition to the waiter. Jonesy gives his take and takes it one step further by illustrating a customer displaying his eyeball to request the bill.

    Source: The London Economic

    Fintech unicorns are leading job creation in London (Business Insider), Rated: AAA

    In 2018, there was a 61% increase in fintech job creation within London from the previous year, per a new report by Robert Walters, making it the fastest growing sector for vacancies in the city.

    The UK houses 25% of all fintech unicorns and their growth plans call for more talent. There are 29 fintech unicorns worldwide, seven of which are based in the UK, making the UK second only to San Francisco, which is home to nine.

    Over 30% of jobs in the UK’s fintech industry are for IT-related roles, compared with 24% in 2017. And fintech unicorns’ hiring for IT professionals increased 74% year-over-year (YoY).

    Source: Business Insider

    London to take San Francisco’s fintech unicorn crown (The Innovation Enterprise), Rated: A

    However, the report has predicted that London could take the lead as early as this year, as the city receives 39% of European fintech venture capital funding, with the runner-up, Berlin, taking just 21% of the total investment.

    With 50% against a global average of 33%, the UK also enjoys the highest rate of consumer fintech adoption of any Western country, only beaten by India and China, the report found.

    LendInvest gains £200m HSBC funding as it seeks home loan market entry (Verdict), Rated: A

    LendInvest, which operates an online marketplace for mortgages, has received an investment of £200m ($261m) from HSBC UK to support its foray into the regulated home loan sector.

    Peer-to-peer scheme for first-time buyers launches (FT Advisor), Rated: A

    Start-up company Stepladder is promoting a new way for first-time buyers to save for a house deposit.

    Arbuthnot Latham launches Arbuthnot Direct for those seeking long-term interest returns (Arbuthnot Email), Rated: B

    Arbuthnot Latham & Co., Limited (“Arbuthnot Latham”) is pleased to announce the launch of its new platform under the trading name of Arbuthnot Direct. Arbuthnot Direct offers fixed term deposits online, targeting retail customers who are seeking interest returns on their money over the longer term. The platform held a successful soft launch in February 2019 and has already met with a positive reception.

    China

    The rise and fall of P2P lending in China (Finextra), Rated: AAA

    It is worth mentioning that the size of China’s P2P industry is larger than that of the rest of the world combined, with outstanding loans of US$217.96BN.

    China’s online P2P lending industry grew rapidly between 2011 to 2015, with the number of P2P lenders growing from 50 to nearly 3,500 respectively.

    Trouble started brewing in China back in 2016, when statistics released by the Chinese Banking Regulatory Commission showed that about 40% of P2P lending platforms were in fact Ponzi schemes.

    This triggered the shutdown of P2P lending platforms; over 900 closed by the end of 2016. For 2018, only 1,021 providers remained in place.

    Source: Bloomberg News

    Shenzhen police arrest Zhang Wei, calling China Create Capital a ‘mafia-like gang’ (SCMP), Rated: A

    China Create Capital Limited, the investment holding company headed by the 46-year-old Heilongjiang native is a “mafia-style gang” involved in illegal fundraising, harassment, blackmail, illegal detention of people and the possession of firearms, the Shenzhen police said in a notice. The whereabouts of Zhang, who was arrested with 43 other executives of China Create, could not be ascertained.

    The arrests are the latest in the Chinese government’s crackdown on crime and corruption in the country’s financial system and capital markets, where 1,129 “mafia-like” syndicates were broken up across 10 provinces last year, with 4.94 billion yuan (US$737 million) of assets seized, according to the police. A number of Chinese oligarchs including Anbang Group’s

    former chairman Wu Xiaohui

    , CEFC Group’s founder Ye Jianming and financier Xiao Jianhua had fallen from grace since 2017.

    $ 60 Million and Rising: China’s Crypto Funds Try Lending to Beat Bear Market (CoinDesk), Rated: A

    These new crypto lenders include such notable names as Bixin Capital, FBG Capital and DGroup, founded by Dong Zhao, who made a name by operating one of the longest-running over-the-counter (OTC) trading desks in China. Along with a startup called Babelbank, these investors have originated a combined $60 million worth of loans over the last five months, denominated in cryptocurrencies or, in one firm’s case, Chinese yuan.

    European Union

    Klarna launches global customer authentication platform (Klarna), Rated: AAA

    Klarna today announced the launch of its global authentication platform — an aggregator with multiple global and local authentication solutions. The platform allows multinational businesses, including merchants and other banks, to provide a simple, secure and personalised customer authentication experience irrespective of market, through a one-time integration.

    Klarna Sees Payments as Evolving From Function to Engagement (WWD), Rated: A

    Klarna’s Hannah Bravo says customers chose brands based on payment options.

    This New Tool Is Helping Retailers Build Consumer Trust During Online Checkouts (Footwear News), Rated: B

    The Klarna platform enables businesses to choose from a range of global and local authentication methods so that they can find one that works best for their customer. Whether using SMS verification or emailed one-time passwords, brands and retailers can verify their customers’ identities with minimal interruption to the consumer’s shopping journey.

    International

    Drivers of Global Growth in FSB’s Shadow Banking (DBRS Email), Rated: AAA

    DBRS sees significant risks stemming from continued growth in shadow banking globally. Assets are now at $52 trillion globally, up from $30 trillion in 2010, according to the FSB. The U.S. has the largest concentration with 29% of global shadow banking assets. But, this is down from 48% in 2010, as other regions are growing faster.

    Summary highlights of the commentary include:

    • Shadow banking is still growing. This narrow, but rapidly growing, subset of nonbanks had assets of $52 trillion in 2017, up 75% from $30 trillion in 2010.
    • Since 2010, assets of nonbanks are also growing, up 61% to $185 trillion. That is 49% of the $378 trillion in total global assets in all financial institutions at the end of 2017, up significantly from 44% in 2010.
    • The key driver of this growth in nonbank assets is the expansion of OFIs. These OFIs are defined as all financial institutions that are NOT central banks, banks, insurance companies, pension funds, public financial institutions, or financial auxiliaries. Assets at these OFIs grew 71% since 2010 to a record $117 trillion in 2017, or just over 30% of assets in financial institutions globally.
    • By far, the largest segment of shadow banking globally is collective investment vehicles, which are subject to runs. These include fixed income funds, mixed funds, MMFs and hedge funds. Since 2010, this segment has grown by 130% to $36.7 trillion in assets. By contrast, growth in other segments has been less than $1 trillion, or even negative.

    Read the full report here.

    Crypto Lending Platform Salt Adds Support for Dash as Collateral (Crypto-Economy), Rated: A

    Cryptocurrency lending platform Salt will now be allowing its users to collateralize their Dash holdings including their Masternode staking coins to access loan facilities.

    India

    RentoMojo in talks to raise $ 40 million from GMO, others (livemint), Rated: A

    For RentoMojo, the latest fundraise comes almost two years after it raised $10 million in July 2017 from Bain Capital, Accel and Chiratae Ventures. Renauld Laplanche, chief executive of US-based Lending Club, also took part in his personal capacity.

    Asia

    Housing sector remains major source of complaints: BPKN (The Jakarta Post), Rated: A

    The BPKN received 154 complaints in the first quarter, most originating from the housing sector. BPKN communications and education coordinator Arief Safari said the agency had received 129 complaints on the housing sector in the first quarter, followed by six complaints on online peer-to-peer (P2P) lending, three on banking and the remainder on various sectors, including travel and e-commerce.

    Batumbu to help finance SMEs (The Jakarta Post), Rated: A

    PT Berdayakan Usaha Indonesia has announced that it aims to help small and medium enterprises (SME) access financial capital through a partnership program with its digital platform Batumbu.

    MENA

    Authors:

    George Popescu
    Allen Taylor

    The post Thursday April 11 2019, Weekly News Digest appeared first on Lending Times.

    Thursday March 21 2019, Weekly News Digest

    fintechs and personal loans

    News Comments Today’s main news: BlockFi hits $25M in deposits in 2 weeks. Cash-back ETF injects trouble into ETF market. PeerStreet expands product line. Funding Circle fund higher impairments drag returns. Dianrong blames Chinese regime for troubles. Today’s main analysis: New home equity loans do not significantly alter credit scores. Today’s thought-provoking articles: SoFi Money review. Can Citi, JPMorgan beat […]

    The post Thursday March 21 2019, Weekly News Digest appeared first on Lending Times.

    fintechs and personal loans

    News Comments

    United States

    United Kingdom

    China/Hong Kong

    Other

    News Summary

    United States

    BlockFi Receives $ 25 Million in Crypto Deposits in Just 2 Weeks After Launching Lending Products (CryptoGlobe), Rated: AAA

    BlockFi Lending LLC, a New York-based “secured non-bank lender” that provides cryptocurrency-backed loans in USD to digital asset investors, has revealed that its interest-generating deposit accounts have received over $25 million in cryptocurrency.

    SoFi Money Review: Online Checking (Nerdwallet), Rated: AAA

    SoFi Money is an online checking account by SoFi, a company best known for its student loan refinance loans. SoFi’s account has a top-of-the-line interest rate and no monthly or overdraft fees. There’s no free ATM network, but SoFi reimburses many third-party ATM fees and doesn’t charge its own. SoFi also boasts unique perks: free career counseling and financial planning sessions.

    Can Citi and JPM beat FinTech Personal Loans? (PeerIQ Email), Rated: AAA

    The personal loan market has grown rapidly since 2010 and the growth has been driven by FinTechs. 

    Source: TransUnion, PeerIQ

    “My Chase Plan” and “My Chase Loans” – a point-of-sale financing alternative and a personal loan product respectively – that will be offered to its existing credit card customers.

    LendingTree Study Finds New Home Equity Loans Do Not Significantly Alter Credit Scores (LendingTree), Rated: AAA

    Home prices in the United States have rebounded to new highs since the financial crisis. As a result, American homeowners are sitting on the largest amount of home equity in history — at just over $15 trillion dollars, according to the Federal Reserve.

    • The decline in scores averaged just 13 points. At the high end, scores declined by 24 in San Jose,Calif. The smallest decline was 5 points in San Diego. Borrowers had an average score of 735 to start, so the declines are quite negligible in terms of access to credit and may have marginal impacts on the cost of credit. The highest starting credit score was 752 in San Francisco, while the lowest was 712 in Indianapolis.
    • The decline took an average of 158 days to reach bottom, which is just over five months. St. Louis homeowners saw their credit scores reach their lowest points in an average time of 101 days (3 months), while the longest decline was for homeowners in Dallas at 211 days (7 months). Loans do not appear on credit reports immediately after closing. Typically, the lender starts reporting to the credit bureaus after your first payment, depending on the lender’s reporting cycle. Thus it may take about 60 days after closing or even longer for it show up and start affecting a score.
    • Scores recovered over an average of 163 days. This is also just over five months, so the time to fall and recover are about equal. The quickest time to recover was 102 days, or slightly over 3 months, in Cincinnati. Borrowers in Chicago had the longest recovery time of 243 days, just over 8 months.
    • Scores recover within a year and begin to move higher. The complete cycle to return to the credit score prior to the home equity loan takes 321 days, less than 11 months. The shortest cycle was in St. Louis at 211 days and the longest in Chicago at 443 days, about 15 months.

    As Cash-Back ETF Hits Market, Signs of Trouble Start to Mount (Bloomberg), Rated: AAA

    Last week, one ETF upstart created a minor splash by doing what was once unthinkable — offering to pay investors to buy into its exchange-traded fund. That comes on the heels of eight fund providers — including JPMorgan Chase, Vanguard and BlackRock to name a few — all slashing fees in one of the industry’s most aggressive rounds of price cuts to date.

    The sub-zero fee giveaway by Salt Financial, which previously ran a single $11 million ETF, is widely seen as a marketing gimmick to drum up a little PR, get customers in the door and increase its assets under management. During the first year, investors will receive 50 cents for every $1,000 in a new low-volatility stock ETF — until it grows to $100 million. After a year, a management fee of 0.29 percent, or $2.90 per $1,000, could kick in.

    The race to zero, however, is very real. Fidelity Investments jump-started the no-fee push in August by offering index funds for free. In February, SoFi said it would waive charges on two planned ETFs for the first year. Last week, JPMorgan started selling America’s cheapest-ever ETF for the princely sum of 20 cents for every $1,000 invested. And BlackRock unveiled plans Wednesday to cut fees for large clients in one of its S&P 500 indexed mutual funds.

    PeerStreet Expands Product Line with Residential for Rent Loans (BusinessWire), Rated: AAA

    PeerStreet, a platform for investing in real estate backed loans, today announced the launch of a new loan product for private lenders: Residential for Rent loans. Residential for Rent loans have a 30-year term so borrowers can secure long-term financing for residential rental properties. This launch is in response to key market conditions: as more people struggle to finance buying a home, the rental market has continued to grow.

    3 Big Reasons To Fill Out The FAFSA (Even If You Think You Earn Too Much) (Huffington Post), Rated: A

    One-quarter of families don’t complete the FAFSA, according to Sallie Mae’s 2018 How America Pays for College survey. Of those that don’t fill it out, 48 percent say it’s because they don’t believe they’ll qualify for financial aid.

    But they’re often wrong: An analysis by NerdWallet found that in 2017, students left an estimated $2.3 billion in federal financial aid on the table by not filling out the FAFSA.

    According to Elaine Rubin, senior contributor and communications specialist at private student loan marketplace Edvisors, most Americans are eligible for some type of federal aid. In fact, it’s available to anyone with a household income below $250,000 per year, CNBC reported.

    Madden lawsuit nears end, but online lenders still seek fix from regulators (American Banker), Rated: A

    An 8-year-old class action that wreaked havoc on the online lending industry is finally winding down, but the lobbying push in Washington to undo its impact shows no signs of abating.

    Lawyers in the case have filed a proposed settlement that would provide $9.8 million in cash and debt relief to as many as 58,000 consumers, setting up the final chapter in a lawsuit that is likely to be remembered best for the legal precedent it established.

    The State of Digital Engagement for Online Lending (LendIt), Rated: A

    A recent trend report by Clarity Services, a credit reporting provider, showed that online funded loan volumes grew by almost 500% between 2013 and 2017.

    How Far are Most in their Digital Transformation Strategy?

    • 54% of financial institutions have developed a digital strategy, but have not yet implemented it
    • 29% of financial institutions are currently developing a digital transformation strategy
    • Only 14% of financial institutions are in the process of implementing a digital transformation strategy

    How Much Will They Be Investing In Digital Transformation in the Next 12-18 Months?:

    • 65% are planning to increase spending by 10%
    • 26% are planning to increase spending by 1-9%
    • 6% have no plans to change spending

    What will They be investing in over the next 12-18 Months?

    • Replace or upgrade legacy IT systems — 88%
    • Reduce operational inefficiency — 76%
    • Improve customer experience — 74%

    X Financial’s Fourth Quarter Results Take Stock 5% Higher (Capital Watch), Rated: A

    The stock of X Financial (NYSE: XYF) jumped more than 5 percent Tuesday morning, to $6.55 per American depositary share, after the peer-to-peer lending marketplace announced improved revenue and profit for the fourth quarter, as well as a dividend for 2018.

    The Shenzhen-based company, which connects borrowers and investors on its platform, reported in a statement Monday evening that its revenue grew 18 percent year-over-year to $125.5 million during the three months through December.

    Its net income, X Financial said, was $35.2 million, or 22 cents per share, at a 53 percent increase from the same period of 2017.

    Why Corporates Cant Fund Early Pay Programs (Dynamic Discounting + SCF) (Spend Matters), Rated: A

    If you look at the graph below, 5% of S&P 500 companies hold more than half the overall cash; the other 95% of corporations have cash-to-debt levels that are the lowest in data going back to 2004, according to Wells Fargo research. We know who those 5% are — they are the GAFA companies: Google, Amazon, Facebook and Apple.

    Source:

    ZestFinance Using AI To Bring Fairness To Mortgage Lending (Forbes), Rated: A

    Discrimination in lending has long been a problem, shutting minority groups out of the home buying process.

    ZestFinance, the artificial intelligence software company focused on the credit market is trying to change that with ZAML Fair, a new software tool that aims to reduce the instances of biases and discrimination in lending.

    CoreLogic Launches PanoramIQ to Provide More Accurate and Complete Property Insights (CoreLogic), Rated: A

    CoreLogic, a global property information, analytics and data-enabled solutions provider, today announced PanoramIQ, an intelligent property solution that delivers a more complete view of property data with more current and reliable sources than public-record data alone. Utilizing a combination of public and proprietary property datasets, a unique property ID, machine learning and advanced analytics, PanoramIQ provides lenders, mortgage industry professionals and government entities with deeper, more accurate and complete property insights, allowing clients to make better decisions in a timely and efficient manner.

    White Oak Healthcare Finance Launches Real Estate Investment Vehicle with New Hires (ABL Advisor), Rated: A

    White Oak Healthcare Finance, LLC announced it will broaden its product offering and enter the healthcare real estate investment market.  White Oak hired Jeff Erhardt, Paul Nevala, Mike Treiber and John Brussard to build out the vehicle, which will initially invest up to $500MM and will focus on investments in seniors housing and skilled nursing properties using triple net leases and joint-venture RIDEA structures.

    Banks seek Congress’ help to block fintech path to ‘industrial’ charters  (Roll Call), Rated: A

    A bank industry group is lobbying Congress to block financial technology firms, such as online lender Social Finance Inc. and payment processor Square Inc., from obtaining an obscure form of a state bank charter that would let them operate nationally with little federal supervision.

    The Independent Community Bankers of America last week distributed a policy paper around Washington calling for an immediate moratorium on providing federal deposit insurance to industrial loan companies, or ILCs, which are chartered by only a few states — most notably Utah.

    Form S-3 Senmiao Technology Ltd (Street Insider), Rated: A

    Approximate date of commencement of proposed sale to the public: From time to time after this registration statement becomes effective.

    Debt Securities. We may offer debt securities, which may be secured or unsecured, senior, senior subordinated or subordinated, may be guaranteed by our subsidiaries, and may be convertible into shares of our common stock. We may issue debt securities separately or together with, upon conversion of or in exchange for other securities. It is likely that any debt securities issued will not be issued under an indenture.

    Figure Technologies, Inc. Expands Leadership Team as It Builds Out Financial Empowerment and Wealth Offerings (PR Newswire), Rated: B

    Figure Technologies, Inc., a fintech company in both the home equity and blockchain space, announces that John Sweeney has joined the company as the head of Wealth and Asset Management, along with Dr. Michael Dooley, who joined as chief economist. These hires reflect Figure’s commitment to empowering consumers and building out products to improve their financial well-being.

    LendPro Hires Belinda Kelton as Vice President of Sales (LendPro Email), Rated: B

    LendPro LLC, a provider of Lending-as-a-Service (LaaS) products and platforms for retailers, has hired retail industry veteran Belinda Kelton as its Vice President of Sales, the company announced today. Kelton is the latest of many new hires for the fast-growing fintech company, which recently moved to a new location to accommodate new staff members and provide the best service possible to customers.

    Corporate Counsel, Commercial (Go In House), Rated: B

    Affirm is looking for a business-minded Corporate Counsel, Commercial with broad expertise in complex commercial transactions. This role will report to Affirm’s Associate General Counsel.
    United Kingdom

    Funding Circle fund sees higher impairments continue to drag returns (AltFi), Rated: AAA

    The Funding Circle SME Income fund saw just a marginally positive performance in February with Net Asset Value growth of just 0.05 per cent as impairments continued to hurt performance.

    Impairments reduced NAV returns by 0.7 per cent in February, said analysts at Liberum, in line with the average monthly impairment rate of recent months.

    Revolut Is Testing the Limits of Finance (Bloomberg), Rated: AAA

    Storonsky is getting a taste of the scrutiny that lies ahead as he tries to upend the world of banking with Revolut, his 3-1/2 year-old startup. The U.K.’s financial regulator is examining why the digital bank last summer temporarily turned off a system designed to automatically block suspicious transactions.

    It was valued at $1.7 billion at its last fundraising and now has over 4 million customers after new accounts tripled in 2018. That’s about three times more than the two lenders combined and the same number of customers as foreign-exchange business TransferWise, which is four years older.

    Source: Innovate Finance

    CrowdProperty launches equity sale after increasing loan book by £100m (PlaceTech), Rated: AAA

    The specialist peer-to-peer lender has secured £100m of loan capital as it launches a public crowdfunding campaign, already oversubscribed, that values the business at more than £15m.

    Having raised £100m from an unnamed “major institution”, CrowdProperty will use the funds to expand the number of property projects it backs over the next 12-24 months.

    OakNorth reports £33.9m profit for 2018 and commits to donating 1% of all future net profit to charitable causes and social entrepreneurship (OakNorth Email), Rated: A

    IFISA Guide: SME loans (P2P Finance News), Rated: A

    Ablrate’s IFISA offers returns ranging between 10 and 15 per cent, enabling investors to fund asset-backed loans to UK businesses.

    ArchOver’s IFISA enables investors to fund secured business loans and enjoy tax-free returns of up to 10 per cent per year.

    MoneyThing’s IFISA is one of the highest-paying tax wrappers that invests in secured business loans, offering annual returns of up to  13 per cent.

    Assetz Capital

    Returns vary depending on the account, going from 4.1 per cent to 6.25 per cent on its auto-invest products, and up to 15.5 per cent with its manual lending option.

    Funding Circle

    The minimum investment in this flexible IFISA is £1,000.

    LendingCrowd

    The Growth and Income ISAs automatically spread investors’ money across a range of loans and have variable target rates of six per cent and 5.6 per cent, respectively.

    Specialist lender funding will be the key issue for 2019 – LendInvest (Mortgage Solutions), Rated: A

    The situation is a big reminder to lenders that it is crucial to concentrate on building a diverse range of funding sources, rather than just one single route.

    It’s something that we have put a lot of work into at LendInvest, as it allows us to lend with confidence, knowing that the funds we have promised to a borrower will be there.

    The firm sent out an email on 24 January 2019 suggesting that recipients should have a “stockpile ready” as some believe Brexit “could affect the amount of food available,” while offering a £5 promotional discount on a loan.

    Why investors are fleeing the ‘fear and greed’ of stock markets for peer-to-peer loans (The Telegraph), Rated: A

    Investors are ditching the stock market in favour of bundled loans sold by fledgling platforms that are yet to be tested by a financial crisis.

    The top 20 UK places for high net worth earners (Citywire), Rated: B

    Nearly two fifths of the UK’s top earners now live in London, according to research from peer to peer lending platform easyMoney.

    China/Hong Kong

    China’s Online Lender Dianrong Blames Chinese Regime for its Woes (NTD), Rated: AAA

    Dianrong, one of China’s biggest peer-to-peer (P2P) lenders, is laying off staff and shutting stores. The company blamed the Chinese regime for its troubles and said the absence of clear-cut policies was proving to be a heavy burden.

    Dianrong shut down 60 of its 90 offline stores and laid off an estimated 2,000 employees, Reuters reported in early March.

    Pintec’s Stock Rises on Steady Results During Quarter of IPO (Capital Watch), Rated: A

    Pintec Technology Holdings Ltd. (Nasdaq: PT) gained 15 cents in trading by midday after reporting a slight increase in revenue and narrowed losses for the fourth quarter.

    The Beijing-based tech platform facilitating financial services said on Wednesday that its revenue in the three months through December was $32.9 million, 2 percent higher year-over-year. Its net loss was $1.2 million, a 10 percent decrease from the same period of 2017. Loss per share was 1 cent.

    For the full year, Pintec reported revenue of $153.1 million, 85 percent higher from the preceding 12 months, and profit of $1.1 million in contrast to a loss in 2017.

    KKR Raising First Asia Real Estate Fund, Targeting $ 1.5 Billion (U.S. News), Rated: A

    Global investment powerhouse KKR & Co Inc is raising its first Asia-focused real estate fund, targeting $1.5 billion as it looks to deepen its real estate portfolio in the region, said people with knowledge of the matter.

    Investment firms raised $18.6 billion in 26 Asia-focused real estate funds last year, the highest since 2008, according to data provider Preqin. KKR’s U.S.-based rival Blackstone Group raised the region’s biggest real estate fund last year at $7.1 billion.

    China and distressed debt top DB’s hedge funds tastes test (City Wire Selector), Rated: A

    Alternative investors are increasingly drawn to Asian hedge funds and distressed strategies, according to the latest Alternative Investment Survey from Deutsche Bank.

    The 2019 survey canvassed the views of 425 asset allocators running $1.7 trillion of hedge fund assets in 28 countries.

    European Union

    Finnest and Invesdor Merge to Combine Debt and Equity Operations in Europe (Crowdfund Insider), Rated: AAA

    Finnest, an Austria based Fintech that provides debt capital to small and medium-sized firms, has announced a planned merger with Finland based Invesdor Oy. The newly formed company will see the combination of a leading Nordic equity crowdfunding platform and a top online lender serving the DACH region (Deutschland, Austria, Switzerland). The two companies will now be able to offer a full stack of debt and equity services and investments across Northern Europe as well as more numerous options for investors.

    Invesdor claims over 50,000 registered users as well as a MiFID II license for 28 European countries – the first crowdfunding platform to receive approval. Invesdor reports investors, both institutional and individual, from over 150 different countries. Invesdor currently offers a unique financing portfolio in the market, from equity to loans and bonds to IPOs.

    Bitbond to Work with BitGo for Germany’s First Security Token Offering (Bitbond), Rated: A

    Bitbond has launched Germany’s first Security Token Offering with a BaFin approved Prospectus and will be using  BitGo’s Business Wallet. The STO has a hard cap of EUR 100 million (~USD 113 million) and will conclude in May. Thousands of investors have already joined to take advantage of early bird discounts.

    The STO marks a significant milestone for the crypto asset industry, not only because it has an approved prospectus, but also because it offers tokenized debt with a predetermined maturity. Bitbond Token (BB1) holders will receive quarterly and annual payments for 10 years, after which Bitbond will buy back the token at its original value of EUR 1 per token.

    India

    Top 5 sectors that need upskilling: How to stay relevant in age of disruption? (Indian Express), Rated: A

    The banking sector is witnessing a massive growth owing to the launch of connected products and services, business innovation and the rise of the middle class along with the emergence of new fintech areas of mobile payments, digital wallets and P2P lending. Technologies such as chatbots, blockchains and automation through robotics powered by AI are transforming the sector.

    CRYPTO EXCHANGE COINDCX RAISES SEED FUNDING FROM BAIN CAPITAL VENTURES (Coin News Span), Rated: B

    Bengaluru-based client leasing startup RentoMojo has raised $10 Mn serial B funding from Bain Capital Ventures and Renaud Laplanche.

    Asia

    Look out for 2019’s top 7 lending startups (e27), Rated: AAA

    As of 2019, there are still 2.45 billion underbanked and unbanked people in the world. The more innovative lending companies there are, the faster this market will be covered and served.

    October.eu (formerly Lendix) is an innovative, easy-to-use, and intuitive peer-to-peer platform for lending and investing.

    The Dharma team works on a platform that lets businesses build lending products on the Ethereum blockchain.

    The governing idea of Kabbage is that funding shouldn’t be complicated for businesses. So, the company makes an effort to provide entrepreneurs with up to US$250,000 in loans for which you can allegedly qualify for in just 10 minutes or at most, a day.

    Founded in 2014, TurnKey Lender has already become the market’s leading intelligent all-in-one lending automation platform.

    The name SoFi comes from social finance and it’s another great example of a successful peer-to-peer lending operation. Founded in 2011, the company is already a huge market player with US$30 billion worth of funded loans and 600 thousand members.

    Affirm goes a different route than most alternative lenders. The idea behind it is enabling in-house financing for retail businesses. So, the store’s customers get an instant loan with zero to 30 per cent interest rates.

    With quite a unique approach, Lendio offers small business an opportunity to get services and credit products from lenders with the best conditions. It’s a marketplace with more than 75 lenders on board.

    Vietnam is the region’s fintech hub (The ASEAN Post), Rated: AAA

    Vietnam’s strong economic growth in recent years has led to the flourishing of the nation’s digital economy. The country’s economy in 2017 was deemed to be one of the best performing in the region. Its economy saw a 6.8 percent increase in gross domestic product (GDP) – higher than the government’s initial target of 6.7 percent – making it one of the fastest growing economies in Southeast Asia.

    Vietnam currently has 54 percent of its population on the internet and the number is expected to grow further in the coming years.

    Data from Vietnam Briefing shows that 39,580 start-ups entered the Vietnamese market in just the first four months of 2017, a 14 percent increase from the first quarter of 2016. Within the start-up scene, the fintech sector has become the most attractive for investments, receiving US$129 million in 2016.

    Travelstop Targets Fintech SMEs with Business Travel Management Platform (Fintech News), Rated: A

    Co-founded by former Expedia employees, Singapore-based Travelstop is a modern, artificial intelligence (AI) powered SaaS platform that simplifies business travel, automates expense reporting for businesses in Asia, and offers insights to business owners.

    The platform is quickly gaining traction from the region’s startups and fintech community, helping small and medium-sized enterprises (SMEs) and high-growth organizations including Funding Societies, Fintech News Network, RedDoorz, S P Jain School of Global Management and Dot Property better to manage their business travels.

    Asia has the largest share of mobile internet traffic, with 61% of its population using mobile devices to go online.

    How Ovo Has Grown to be Indonesia’s Largest Digital Payments Platform (Entrepreneur), Rated: A

    After online stores, Indonesia’s leading digital payments platform Ovo has been making strides into offline stores, increasing the number of merchants that accept the payment method.

    OVO has reportedly acquired local peer-to-peer lending company Taralite, a move that will pave the way for OVO to branch out into the lending business which is seen to be a potential profit-generator for the company.

    TurnKey Lender Opens a New Office in Kuala Lumpur (Digital Journal), Rated: A

    TurnKey Lender, a provider of intelligent lending automation, decision management, and risk mitigation solutions, announces the opening of a new office in the capital of Malaysia, Kuala Lumpur. Its main goal will be to physically represent TurnKey Lender and support the company’s operations in Asia.

    With internet penetration at 85.7% in 2018, the country is perfectly positioned for the rapid growth of alternative lending initiatives in areas like peer-to-peer lending and in-house financing.

    Golden Gate Ventures ties up with Hanwha to invest in Asian startups (SDF-KH), Rated: B

    Golden Gate and Hanwha will focus on startups that are raising fund for ‘Series B’ stage.

    Singapore-based Golden Gate Ventures confirmed on Tuesday that it has teamed up with South Korea-based Hanwha Asset Management to invest in Southeast Asian technology startups.

    Authors:

    George Popescu
    Allen Taylor

    The post Thursday March 21 2019, Weekly News Digest appeared first on Lending Times.

    Thursday December 6 2018, Daily News Digest

    Consumer Spending

    News Comments Today’s main news: Zopa gets banking license. SoFi cuts mortgage business jobs. KBRA assigns preliminary ratings to CLUB Credit Trust 2018-P3. Money360 surpasses $1B in loan originations and closings. SoftBank is biggest startup story in 2018. Today’s main analysis: Rate hikes pause in 2019. LendingTree Debt Report November 2019. Today’s thought-provoking articles: LendingTree Debt Report November 2019. October was biggest […]

    Consumer Spending

    News Comments

    United States

    United Kingdom

    International

    Southeast Asia

    Other

    News Summary

    United States

    SoFi Cutting Jobs in Their Mortgage Business (Lend Academy), Rated: AAA

    Late Friday Bloomberg reported that SoFi was cutting 7% of its staff, or around 100 jobs, in the company’s mortgage department. This is due to a change in strategy as to how they underwrite mortgage loans. Rather than underwrite loans themselves, as they have done since launching their mortgage business back in 2014, they will outsource the underwriting to a partner.

    KBRA Assigns Preliminary Ratings to Consumer Loan Underlying Bond (CLUB) Credit Trust 2018-P3 (AP News), Rated: AAA

    Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three classes of notes issued by Consumer Loan Underlying Bond (CLUB) Credit Trust 2018-P3 (“CLUB 2018-P3”). This is a $272.40 million consumer loan ABS transaction that is expected to close December 13, 2018.

    The transaction has initial credit enhancement levels of 30.87%, 22.80% and 9.70% for the Class A, Class B, and Class C notes, respectively. Credit enhancement is comprised of overcollateralization, subordination of the junior note classes, a cash reserve account and excess spread.

    This transaction is LendingClub Corporation’s eighth rated sponsored securitization, fourth of 2018 and the fifth sponsored securitization consisting of prime unsecured consumer loans facilitated by LendingClub’s proprietary technology platform supporting an online marketplace that connects borrowers and investors by offering a variety of loan products originated by issuing banks through the platform, www.lendingclub.com.

    Money360 Milestone: Surpasses $ 1 billion in Loans Originated & Closed (Crowdfund Insider), Rated: AAA

    Real estate marketplace lender Money360 announced on Monday it has surpassed $1 billion in loans originated and closed since inception. The announcement comes just 11 months after the lending platform revealed it had hit $500 million.

    Rate Hikes Pause in 2019; Performance of Credit Card Borrowers with Personal Loans (PeerIQ), Rated: AAA

    US Q3 GDP showed 3.5% annualized growth, well above potential growth of 2%. Growth slowed from the blistering 4.2% pace in Q2 due to rising inventories and lower consumer spending:

    Source: WSJ, PeerIQ
    Source: VantageScore, PeerIQ

    LendingTree Debt Report November 2018 (LendingTree), Rated: AAA

    Nine months into 2018, Americans had a cumulative $3.93 trillion in non-mortgage debt. About a quarter of that debt is credit cards and other revolving debt, while the remainder is for car payments, student loans and other fixed-rate loans such as personal loans.

    In just five years, Americans will have increased their debt by $1 trillion. Consumer debt eclipsed the $3 trillion mark in 2013. By comparison, the previous $1 trillion milestone — from $2 trillion to $3 trillion of consumer debt — took more than 10 years.

    43.5% of Purchase Borrowers Received Mortgage Rates Under 5% Last Week (LendingTree), Rated: A

    For the week ending Dec. 2, 2018, the share of borrowers with rates under 5% was the highest in two months, which may lend some support to a weakening housing market.

    Source: LendingTree
    Source: LendingTree

    LendingTree’s State Migration Study Finds Americans Are Moving South (GuruFocus), Rated: A

    LendingTree today released its State Migration Study on where Americans are interested in moving. The study looked at where people moving out of state are going and discovered that of the 12.1 percent of homebuyers across the country who change states, most plan to head south.

    Florida is the No. 1 destination. Florida was the top new destination for 15 of the 50 states.

    Texas residents love the Lone Star State. Texas had the highest percentage of residents looking to move within state lines — 93.4 percent of purchase mortgage requests from individuals in Texas were for properties in the same state.

    Source: LendingTree

    October was Biggest Month for Reg CF Since May 2016 (Crowdfund Insider), Rated: AAA

    October was a big month for Reg CF campaigns, according to the StartEngine Index. In fact, October booked the most money raised using the crowdfunding exemption since the rule became actionable in May of 2016.

    According to StartEngine, $10.9 million in funding was raised. Until October came along, this past July held the top spot at $10.7 million. The Index indicates that Reg CF has now raised $151.7 million since inception. The Food & Beverage industry remains the most popular sector to use Reg CF followed by Tech.

    Source: Crowdfund Insider

    Fintechs’ Take On Installment Payments Explodes Online (Forbes), Rated: AAA

    Installment payments have been around for seemingly forever but a new crop of fintechs are offering it with a twist: the ability to pay off smaller purchases in installment payments that in many cases are interest-free.

    And it appears to be resonating with scores of U.S. consumers judging from the brisk business installment payment services like QuadPay.com enjoyed during the kick off to holiday shopping season this past Thanksgiving weekend. David Sykes, chief operating officer at QuadPay.com said 35% of online Black Friday sales for one large merchant customer came via QuadPay. On average Sykes said its service accounts for around 20% of all the online transaction from its roughly 500 e-commerce partners.

    QuadPay.com makes money via the merchant, getting a cut of the sales generated by its service. That enables it to offer interest-free loans to consumers wanting to purchase everything from Uggs to underwear. Sykes said the average value of the orders on the platform is $150. QuadPay takes 25% of that on day one and then spreads out the remaining payments every two weeks. Because the average installment payment is around $37 there isn’t too much risk of customers defaulting on the loan.  To prevent default it won’t let a customer use the service again if they were ever late with a payment. The executive noted QuadPay approves 92% of all applicants.

    How the largest US financial institutions rank on offering the mobile banking features customers value most (Business Insider), Rated: A

    In Business Insider Intelligence’s second annual Mobile Banking Competitive Edge study, 64% of mobile banking users said that they would research a bank’s mobile banking capabilities before opening an account with them. And 61% said that they would switch banks if their bank offered a poor mobile banking experience.

    Source: Business Insider

    Why Wealthfront is offering free financial planning (Financial Planning), Rated: A

    Wealthfront is offering its planning services for free, effectively unbundling its software, and giving millions of Americans access to a financial roadmap.

    The second largest independent robo is betting the firm can steer users into fee-based accounts after they interact with its software to come up with a financial plan. The freemium software uses the firm’s automated advice engine, Path, according to the firm.

    Credit Karma’s Kenneth Lin on building a billion dollar brand (Tearsheet), Rated: A

    Building a great service is hard but not impossible. But building a great service and making it available for free — that’s really hard.

    Credit Karma seems to have figured out a way to do both. The company, with 85 million members in the U.S. and Canada, continues to roll out free, innovative financial products to its user base. It all began 11 years ago with a simple premise: to provide users with free access to their credit scores. From there, the company has rolled out a bunch of new products, including ID monitoring, tax preparation, a financial chatbot, auto finance, and unclaimed money.

    Betterment launches tool to optimize cash savings (Tearsheet), Rated: A

    Automated investment advisor, Betterment is rolling out “Two-Way Sweep”, a tool that can automatically “sweep” excess money from customers’ bank accounts into a Betterment account optimized to provide better returns for cash.

    What’s behind this new product: Studies show that only one in three millennials is investing in the stock market. That means they’re holding a high percentage of cash. In fact, Betterment sees 30 percent of customers with cash balances of $20,000 on average. This excess in savings earns little to no interest. Betterment’s Two-Way Sweep is intended to take the hesitation out of deploying more money into investments by automating the process.

    CommonBond Acquires NextGenVest to Help Reach Generation Z (Lend Academy), Rated: A

    CommonBond, best known as a leading provider of online student loans, has made its second acquisition, NextGenVest, an artificial intelligence powered advice platform for Generation Z. NextGenVest helps high school and college students in New York, Chicago and Philadelphia with their college financial needs through a combination of human “money mentors” and AI-powered suggestions delivered entirely through text messages.

    OppLoans Named a Best Workplace by Glassdoor for the Second Year in a Row (GlobeNewswire), Rated: A

    Chicago-based fintech firm OppLoans has been honored with a Glassdoor Employees’ Choice Award, recognizing the best places to work in 2019. This marks the second year in a row that the personal lender has been named to this prestigious list in the Small & Medium Business category. The Employees’ Choice Awards program, now in its 11th year, is based solely on the input of employees, who elect to provide feedback on their jobs, work environments and companies on Glassdoor, one of the world’s largest job and recruiting sites.

    Backstage Capital-Backed CapWay Moves to Atlanta As It Expands Its Digital Banking Offerings (Hypepotamus), Rated: A

    According to 2017 statistics from the FDIC, 16 percent of households in Mississippi are unbanked, choosing instead to use “predatory services” like corner store check cashing in their neighborhoods.

    Allen founded her first startup, an app development shop, while still in college. After moving to Silicon Valley, Allen realized it wasn’t just rural communities that were underserved by banks. Inner city areas across the country, most of which are home to majority Hispanic and African-American populations, are also affected. An FDIC survey found that more than 15 million adults in the U.S. go unbanked.

    In 2016, Allen founded CapWay with co-founder and fellow Mississippian Timothy Lampkin. The mobile-first platform is aimed at younger generations (think older millennials and Gen Z) in those unbanked communities to help them break out of the predatory economy cycle.

    Finicity Announces Partnership with Princeton Mortgage for Effortless Digital Mortgage Origination (Benzinga), Rated: B

    Finicity, a provider of real-time financial data aggregation and insights, announced today it is working with mortgage banker Princeton Mortgage to automate borrower asset verification for lenders. The agreement will provide Princeton Mortgage loan officers and borrowers with a faster, simpler loan origination experience that reduces both paper chase and headache.

    NBKC Bank fintech accelerator participant wins $ 1M (Biz Journals), Rated: B

    Onward Financial Inc., a member of the first cohort in NBKC Bank’s Fountain City Fintech accelerator program, won a $1 million award from the Communities Thrive Challenge, which is put on by The Rockefeller Foundation and the Chan Zuckerberg Initiative.

    United Kingdom

    P2P Lender Zopa Granted a Banking License in the UK (LendIt Fintech), Rated: AAA

    Back in 2005 Zopa quietly launched their P2P lending platform in the UK, the world’s first. It was the start of a lending revolution that has moved on to all corners of the globe. Today, a new chapter begins as the company announced that regulators have approved Zopa’s banking license. With that Zopa achieves another first: becoming the world’s first combined peer to peer lending platform and digital bank.

    Zopa Says it Will Redefine Banking (Crowdfund Insider), Rated: AAA

    Zopa explained that this is called the “mobilisation’ phase” as regulators put some restrictions in place. A full licence will be granted once it meets the conditions set by the regulators.

    Zopa said it will begin its new service next year. The digital bank will include options such as a fixed term savings product protected by the Financial Services Compensation Scheme (FSCS), credit card and a money management app.

    Pointing to a statement by the FCA that just “40% of UK adults have confidence in the financial services industry,” Zopa sees opportunity in becoming a digital bank unencumbered by green-screen legacy tech and unnecessary brick and mortar branches.

    Zopa explained it would redefine banking with the following services:

    • Giving customers a fair deal as standard – with no catches like sign-up offers that aren’t available to existing customers or hidden fees and charges.
    • Making sure money management is simple and a real person is available to discuss
    • Going beyond ‘good enough’

    Zopa: Bank launch won’t impact P2P rates (P2P Finance News), Rated: A

    ZOPA has insisted its peer-to-peer lending rates will not be dictated by the savings products on offer when its bank launched.

    It currently offers target returns of 4.5 per cent on its Zopa Core product and 5.2 per cent on Zopa Plus.

    Thomas Cook to slip out of FTSE 250 index in quarterly review (The Guardian), Rated: A

    Other companies expected to be promoted to the FTSE 250 are peer-to-peer lending platform Funding Circle, the retirement housebuilder McCarthy & Stone and the investment trusts Smithson and Woodford Patient Capital.

    Funding the future of the UK PLC (Business Leader), Rated: A

    Looking at 2017, we saw some encouraging trends and one of them is in terms of diversity and choice. We saw peer-to-peer lending grow at over 50%. It’s obviously coming from a smaller base as it’s a reasonably new form of lending, but 50% growth is a very strong outcome.

    Tandem’s Journey Card strives to better users’ credit scores (Alt Fi), Rated: A

    Tandem Bank has announced its Journey Card has assisted nearly three-quarters (72 per cent) of its users to first-time credit or is helping individuals with poor credit history get back on track.

    Due to the higher risk users it targets, the credit card carries a reasonably expensive representative APR of 24.9 per cent.

    Tandem says it hopes to help the 43 per cent of Journey Card holders who have poor credit history, some of whom have defaulted with other providers.

    CrowdProperty Provides Performance Metrics Disclosing Lending Returns Using Brismo Methodolgy (Crowfund Insider), Rated: A

    Peer to peer property lender CrowdProperty is now disclosing their performance metrics using Brismo’s (formerly known as AltFi) standardized reporting methodology. CrowdPropert states that it is the first property development platform to incorporate the Brismo process which is described as an independent standard.

    UK housebuilders back new online property listing start-up (Financial Times), Rated: A

    Some of the UK’s largest housebuilders are backing a new property portal that will launch next year in the latest attempt to challenge the two dominant market leaders, Rightmove and Zoopla.

    Barratt Developments, Bovis, Persimmon and Redrow have signed up to list their homes with the start-up Rummage4Property, as have Countrywide and about 30 other estate agency groups.

    ARBUTHNOT BACKS MBI TEAM WITH £2 MILLION FACILITY (Arbuthnot Latham), Rated: A

    Arbuthnot Commercial Asset Based Lending (ABL) has supported a highly experienced Management Buy In (MBI) team, led by Paul Hampton, with a £2m invoice discounting facility to support Premier House Investment’s acquisition of Ralph Coleman International Ltd (RCI) and provide ongoing working capital, paving the way for the company’s exciting expansion plans.

    KAMBO expands its reach with two native apps (Life Pulse Health), Rated: A

    KAMBO is expanding beyond desktops to become accessible on our most coveted devices, our smartphones. With the introduction of two native apps, KAMBO’s lending platform will become one of the most flexible and diverse of its kind.

    The KAMBO app is now available on iOS and Android, making it the first crypto-lending platform to have an app in the App store.

    LendInvest Joins Ingard’s Buy to Let Panel (Crowdfund Insider), Rated: B

    Ingard, a compliance network, brokerage, and lending packager specialist, announced on Tuesday online lending platform LendInvest has joined its buy to let panel. According to Ingard, members may now access the lender’s buy to let range direct by registering through LendInvest’s online portal

    China

    Ping An GammaLab Wins Global AI Machine Reading Comprehension Competition (Markets Insider), Rated: AAA

    Ping An Insurance (Group) Company of China, Ltd. (hereafter “Ping An” or the “Group”) is pleased to announce that OneConnect, a subsidiary of the Group, ranked first in one of the world’s most authoritative machine-reading comprehension challenges — the Stanford Question Answering Dataset 2.0 (SQuAD). GammaLab Institute of Artificial Intelligence (GammaLab), owned by OneConnect, scored 83.435, close to the human performance level of 86.831, way ahead of other companies in the challenge.

    Another scenario is internet arbitration in universal financial inclusion. Small loan companies tend to turn to online arbitration, which is expensive and takes time to resolve, under the current peer-to-peer lending market. With the reading comprehension skill of GammaLab, the arbitrator will finish a case quicker, reducing the cost for arbitration.

    International

    International P2P Lending Volumes November 2018 (P2P Banking), Rated: AAA

    Mintosleads ahead of Zopa and Ratesetter. The total volume for the reported marketplaces in the table adds up to 473 million Euro.

    I removed Unilend, as the platform has closed and the company has gone into receivership.

    Source: P2P Banking

    CORELOGIC LAUNCHES NEW AUTOMATED VALUATION SOLUTION TO HELP STREAMLINE MORTGAGE LOAN ORIGINATIONS (CoreLogic), Rated: A

    CoreLogic, a global property information, analytics and data-enabled solutions provider, announced today the introduction of its Total Home Value for Originations AVM solution.

    The new Total Home Value for Originations solution is specifically calibrated and packaged to improve efficiencies when performing property valuations during the purchase and refinance loan underwriting process.

    Becoming a Digital Leader: 5 Customized Fintech Strategies That Work (Cutomer Think), Rated: A

    According to EY study, fintech startups have raised $41.7 billion in the first half of 2018 across the globe. So, what fintech strategies need to be implemented to transform the consumer experience on the market?

    • Consumers first
    • Rebuilding trust
    • Lack of credibility
    • Partnership instead of competition
    • Improving the quality of lives

    Nasdaq buys Canadian alternative data provider Quandl (Finextra), Rated: B

    Nasdaq has acquired Quandl, a Toronto-based provider of alternative and core financial data. Terms of the deal were not disclosed.

    Australia

    Crypto Lending Services Coming to Australian Markets (NewsBTC), Rated: AAA

    Helio Lending is the first independent crypto lending company to launch on Australian shores according to reports.

    The company claims to be in the position to offer 50% more spending power to clients than they would have by holding on to their crypto assets.

    Lakeba Invests in Lodex to Become Latest Capital Equity Partner (CryptoTechNews), Rated: A

    Lodex, Australia’s first auction-style loans and deposits marketplace leader, today announced it has secured capital investment from Lakeba Group, an established Australian technology innovator.

    India

    India catches up with China, records 2nd highest fintech adoption rate: Here’s all you need to know (Financial Express), Rated: AAA

    India is finally catching up with its neighbour and biggest competitor China. The country now has the second highest fintech adoption rate of 52%, only behind China’s 69%, which also throws a huge opportunity for India to not only make best out of financial services sector but also to disrupt it.

    Southeast Asia

    How Japan’s SoftBank and Its $ 100 Billion Vision Fund Became the Biggest Startup Story of 2018 (Inc.), Rated: AAA

    UberWeWorkSaudi Arabia. The biggest startup stories in 2018 shared one long and influential thread: Japanese conglomerate SoftBank, its $100 billion tech investment fund, and founder Masayoshi Son.

    The Vision Fund is backed by several prominent investors, including Apple and the government of Abu Dhabi, but its largest financial partner is Saudi Arabia’s sovereign wealth fund. The country’s government, under crown prince and de facto ruler Mohammed bin Salman, contributed 45 percent of the $100 billion, and in October announced plans to put another $45 billion into a second Vision Fund.

    P2P lending can plug Southeast Asia’s US$ 175B business finance gap (Yahoo! News), Rated: AAA

    Peer-to-peer (P2P) lending has emerged as a popular alternative financing option for small and medium enterprises (SMEs) in Southeast Asia. In 2016, P2P lending generated US$115.01 million, which accounted for more than half of total market share of Southeast Asia’s alternative financing market. In an evolving financing landscape, P2P lending complements the services banks provide and support the region in realising its growth and development potential. The very fact that investment in the region’s startups tripled from US$2.52 billion in 2016 to US$7.86 billion in 2017 is a testament of the vast potential in Southeast Asia’s FinTech startups.

    Businesses, largely SMEs, benefited from such platforms too. According to a Deloitte report, SMEs contribute to 40% of Southeast Asia’s gross domestic product (GDP) and hiring 70% of the region’s workforce. Despite the importance of SMEs regionally, support is generally lacking, especially in terms of financing. This is due to strict banking regulations imposed after the 2008 global financial crisis, which have made banks and most financial institutions increasingly risk-averse. This is evidenced by McKinsey Global Institute’s report stating that 39 million Southeast Asian SMEs (or 51%) lack access to credit.

    Malaysia may issue more equity crowdfunding, P2P lending licences in 2019 (Asia Asset Management), Rated: AAA

    Malaysia’s securities regulator may license more operators of equity crowdfunding (ECF) and peer-to-peer (P2P) lending platforms next year, after current operators raised more than 200 million ringgit (US$48.25 million) for small firms since the industry was legislated in 2015, according to its chairman.

    Singapore’s Milieu Insight raises US$ 730K to enhance market research platforms (e27), Rated: A

    Singapore- and Thailand-based marketing software startup Milieu Insight has announced that it has raised S$1 million (US$730,000) from a group of private investors including former Rippledot Capital Director, Ravi Ravulaparthi.

    Korean Fintech Startup HonestFund Attracts $ 12 Million Series B Investment (PR Newswire), Rated: A

    HonestFund (CEO: Sanghoon Seo) has announced that the company, one of the largest marketplace lending players in South Korea, has successfully raised $12 million Series B investment.

    Investment was led by Korea’s leading VCs and investment companies, such as Dunamu & Partners, MurexPartners, KB Investment, TL Asset Management, Bass Investment and HB Investment. This brings HonestFund’s total investment to $21 million, making it one of the most valuable Fintech companies in South Korea.

    Canada

    How experimental tech drives TD Bank’s mobile app (American Banker), Rated: AAA

    While many banks have sought to employ experimental technologies when dealing with customers, including predictive virtual assistants, geolocation and advanced data analytics, few have brought all those pieces together to the degree used by TD Bank.

    The bank has used such technologies live in production and won significant customer adoption, with its mobile app becoming No. 1 in the finance category in Canada for both iOS and Android. Mobile customers use the app 17 times a month on average, a figure that is growing.

    OnDeck to merge Canadian operations with Evolocity Financial Group (Seeking Alpha), Rated: A

    OnDeck (NYSE:ONDK) will combine its Canadian lending operations with Evolocity Financial Group, a private, Montreal-based online small business lender, to create OnDeck Canada.

    Africa

    Peer-to-Peer Lending as a Means of Propelling Startup Growth (Modern Ghana), Rated: AAA

    Capital is the livewire of any business, especially for startups and established small businesses. Hence, they are always seeking for some additional funding that is too small for an angel investor to get a return for their effort. Banks also think it’s not worth their time. That’s where peer-to-peer (P2P) lending is working to fill that lending gap. This model may be a solution for many small businesses that are struggling with just tapping smaller funding amounts.

    Authors:

    George Popescu
    Allen Taylor

    Wednesday July 11 2018, Daily News Digest

    Change Year to Year in Commercial loans

    News Comments Today’s main news: PayPal is on an acquisition binge. Financial advisers eschew P2P lending. Ant Financial to go all in on the blockchain. 51 Credit Card IPO priced at HKD 8.50 per share. Today’s main analysis: Consumer debt increases in May. Today’s thought-provoking articles: Business loan drought ends for banks. Germany’s crowdfunding market hits $588M. Brazil leaders want […]

    Change Year to Year in Commercial loans

    News Comments

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    United Kingdom

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    United States

    PayPal is leading a payment company acquisition binge (Quartz) Rated: AAA

    PayPal is tearing through a flurry of payment company acquisitions, having snapped up four in just a five-week period this year.

    This year has already been a record for payment company deals, with $46 billion in acquisitions (paywall) though June, according to Dealogic. That compares with $33 billion in total for last year

    Recent acquisitions include iZettle, a Swedish mobile payments company, and Hyperwallet, which businesses can use to pay employees around the world (the deal size is only shown if it has been verified by Pitchbook):

    Source: Quartz

    Business-Loan Drought Ends for Banks (Wall Street Journal) Rated: AAA

    Preliminary second-quarter data from the Federal Reserve indicate the year-over-year growth rate of business loans rose to 5.5% in late June from less than 1% near the end of 2017. The upturn marks the reversal of a prolonged slump in business-loan growth that began in earnest about two years ago.

    For banks, the acceleration in lending may help lift results when firms report quarterly results this month. Profits from lending are a major component of bank earnings and grow when total loans increase or rates on loans rise. Business-loan growth often helps on both fronts because these credits typically carry floating rates that allow banks to capture rate increases.

    Source: Wall Street Journal

    Consumer Debt Increases In May (PYMNTS) Rated: AAA

    New data shows that U.S. consumer debt rose in May by the most in six months, showing that Americans were more comfortable with spending midway through the second quarter. The data from the Federal Reserve shows an increase in revolving debt, which includes credit cards, as well as a boost in non-revolving debt that includes educational and auto loans.

    Source: Lending Tree

    This latest news comes after LendingTree, the nation’s leading online loan marketplace, released its first Consumer Debt Outlook in May 2018, finding that Americans owe more than 26 percent of their income on consumer debt, up from 22 percent in 2010. That means Americans are on track to accumulate a collective $4 trillion in consumer debt by the end of this year. In fact, over the past five years, Americans have been accumulating more debt, and for nearly two years, consumer credit has grown at a steady rate of 5 to 6 percent annually.

    Source: Lending Tree

    See the full results of the study here.

    Insolvent insurer causes headache for Va. bank’s student lending (American Banker) Rated: A

    Virginia National Bankshares in Charlottesville, Va., will increase the loan-loss allowance for its student loan portfolio after an outside insurance carrier was shut down.

    The $625 million-asset Virginia National said in a regulatory filing Thursday that ReliaMax Surety, a South Dakota insurer that issued surety bonds tied to purchased student loans, is insolvent and was placed into liquidation last month.

    JPMorgan Chase launched an online bank for millennials called Finn, and I prefer it to the real thing (Business Insider) Rated: A

    Finn, a mobile bank built by Chase, recently rolled out nationwide. And I gave it a try.

    In addition to offering bread-and-butter checking and savings account functionality, it also offers services many firms in the personal finance startup space have built their businesses around. These include automatic saving tools and charts to see where you are spending money.

    Personally, I think the app is a better experience than my traditional Chase mobile bank, since it more easily allows you to send checks from the app, save money in an easy and fun way, and keep track of your spending. It’s also free. And there’s no overdraft fees. But it’s not without flaws.

    The Past, Present and Future of the ILC Bank (DeBanked) Rated: A

    Last Thursday, Square confirmed that it withdrew its application to the FDIC for depository insurance, which would allow it to take deposits from customers in all 50 states. The company said it plans to refile.

    Regardless of the reason for withdrawing the application, this news revives the debate over whether fintech companies should be allowed to become banks in the first place – at least in the manner that Square and SoFi have sought to attain bank status.

    How to invest $ 100 regularly and make it a fortune? (Global Banking and Finance) Rated: A

    Don’t let your money sit, let it work for you. I know I sound bit weird, but you can put your money to work. No! you do not need the fortune to invest in, just $100 is all that is required. Though investing an amount may appear bit difficult in starting but once you get a hold on the things, it will become easy eventually. Investing is all about making a choice, you can invest $100 and can earn thousands in future or you can just spend this amount on a dinner.

    Lending Club

    This could be another great option to make the investment in. Lending Club is basically a peer-to-peer lending, where borrowing and lending takes place between the ordinary folks. This is one of the largest online market in the world, that connects the investors and borrowers.

    Can I turn $ 100k into $ 1 million in a decade? (Money Rates) Rated: A

    A decade is a fairly short period of time, so think about what it will take to grow your initial investment by a factor of ten in ten years. With no additional investment, turning $100K into 1 million would require a compound average annual return of 25.9 percent, which is pretty unrealistic. Historically, the U.S. stock market has averaged a return on investment of about 10 percent per year.

    Peer-to-peer lending has created a relatively new form of income investing in which you can invest by making personal loans. Higher risk loans produce higher income yields but are also more likely to default. You can manage your risk somewhat by choosing lower risk loans, focusing on shorter term loans and diversifying by funding small amounts of many different loans.

    Credibly Hires Former CIO of FBI to Drive Information Technology Strategy (Crowdfund Insider) Rated: B

    Credibly, a small and medium-sized business lending platform, announced on Tuesday it has hired Jerome Pender to drive its information technology strategy. According to the online lender, Lender is a seasoned professional more than three decades of experience in information technology. He has experience in business systems, enterprise architecture, technology, and governance.

    Prior to joining Credibly, Pender was the Chief Information Officer, Operating Partner, and Managing Director at Z Capital Partners. He also spent more than a decade at the FBI, serving as Chief Information Officer and Executive Assistant Director, as well as Deputy Assistant Director. Before the FBI, he held several leadership positions at UBS AG.

    United Kingdom

    Advisers eschewing P2P due to insurance ‘grey area’ (Peer2Peer Finance) Rated: AAA

    FINANCIAL advisers are avoiding giving advice on peer-to-peer lending because they are worried it will not be covered by their professional indemnity insurance (PII).

    Max Lehrain, chief operating officer at P2P property lender Relendex, said P2P investing is a “grey area” when it comes to PII.

    Brendan Llewellyn, co- founder and director of communications platform Adviser Home, suggested PI insurers will decide whether or not to cover P2P investments on a case-by-case basis.

    Open Banking – a complete failure? (The Finanser) Rated: A

    PwC recently delivered a report on open banking – Open Banking market could be worth £7.2bn by 2022: PwC – PwC UK. Some notable points raised;

    The principle growth areas are projected as account aggregation, analytics of expenditure and financial product comparisons. This is difficult to understand given that none of these areas is new – in fact the information is being delivered differently – that is all that has changed. And in most cases (relative to challenger banks) the data delivered is very limited, preventing innovation on these pre-existing services. The major market comparison engines pull richer data through a combination of private means and screen scraping, and have made clear that open banking APIs will not replace this in their current form.

    Oblix secures FCA authorisation for P2P lending platform (Bridging & Commercial) Rated: A

    Oblix Capital Technologies has been granted authorisation as a P2P firm by the FCA.

    The authorisation allows the subsidiary to the London-based specialist lender Oblix Group to operate a regulated electronic lending platform.

    Oblix has enjoyed a strong period of growth and hopes the launch of its P2P lending platform will supplement this.

    NEW CHIEF EXECUTIVE FOR PROPERTY LENDER (Insider Media) Rated: B

    A new chief executive has taken the helm at a Birmingham-based peer-to-peer property lender. Michael Bristow has assumed the role at CrowdProperty after acting as a non-executive director.

    Bristow was previously managing partner at Growth Strategy, a property technology investor and private equity advisory business.

    China/Hong Kong

    150 Billion Dollar-valued Firm Ant Financial Will Go All in on Blockchain (Toshi Times) Rated: AAA

    Ant Financial: you may never have heard of it if you don’t live in Asia, but its payment platform Alipay is one of the biggest payments facilitators in the region, bigger than Samsung Pay, Apple Pay, and Android Pay in most Asian countries.

    It is part of Jack Ma’s $450+ billion valued Alibaba empire and recently raised significant investment from investors worldwide pumping its own value up to a whopping $150 billion.

    51 Credit Card’s IPO priced at HKD 8.50 per share (KrASIA) Rated: AAA

    China’s 51 Credit Card, an online credit card management platform, is set to price its IPO at HKD 8.5 per share at the bottom of its indicative range of between HKD8.5 – 11.5, according to various reports.

    The company is set to raise an estimated US$129 million in the flotation, according to a Tencent report.

    Its net profit is up nearly 1304% in 2017 from a year earlier, standing at $112 million (RMB 744 million). However, it has been operating in a negative cash-flow for the last three years and its cash and cash equivalents dropped to 1.26 billion yuan in 2017 from 2.1 billion yuan in 2016.

    Hong Kong digital bank Neat nabs tidy $ 2m funding (FinTech Futures) Rated: A

    Hong Kong-based digital bank Neat has secured a new round of $2 million funding from Dymon Asia Ventures and Portag3 Ventures.

    According to Neat, this investment will be used to unveil some new features and tools; and for recruitment.

    For the features and tools, it offers a vote option on its website to create a “wishlist”. (A common ploy among new firms and banks.)

    Chinese Auto Sales Run Into a Lending Roadblock (Wall Street Journal) Rated: A

    China’s crackdown on shadow banking has caused some high-profile blowups. Now it’s driving the country’s car makers off course.

    One big target for Beijing has been the proliferation of peer-to-peer lending platforms—total transactions on these ballooned to 2.8 trillion yuan ($423 billion) last year, more than 10 times the total in 2014, according to industry website wdzj.com. The worry is that such platforms have become a hotbed for embezzlement, or could simply run out of money. Local media reported dozens of them collapsing.

    Tighter rules may trigger P2P industry shakeout (ECNS) Rated: A

    Only one out of the nine peer-to-peer lending companies in China might be able to survive as top financial regulators are stepping up the pace of scrutiny to curb risks caused by the massive unregulated sprawl in the past few years.

    The central government plans to maintain “pressing posture of severe attack” to clamp down on activities violating laws and regulations in internet finance, extending the ongoing nationwide crackdown for another year, Pan Gongsheng, deputy governor of the People’s Bank of China, the central bank, said during a meeting on Monday.

    Dianrong Names Tony Zhang Chief Technology Officer (PR Newswire) Rated: B

    Dianrong today announced the appointment of Tony Zhang as Chief Technology Officer (CTO). Mr. Zhang will report to Long Hsiang Loh, CEO of Dianrong.

    Mr. Zhang has nearly two decades of experience in science and technology, with in-depth knowledge of financial and internet technology as well as company management. He worked in Silicon Valley for 11 years, including eight years at PayPal in various leadership roles. He provided recognized technical and business leadership across a range of PayPal’s core product features and functionalities.

    International

    LendLedger (LOAN Token): Decentralized Blockchain Crypto Lending Market? (Bitcoin Exchange Guide) Rated: A

    LendLedger hopes to be the solution to these problems by opening up global lending markets. The platform is changing the face of lending to the underserved segments. Already this platform has processed tens of millions of dollars in loan requests in India, which has led to the provision of loans to hundreds of thousands of borrowers in the informal and small business sectors in 40 Indian cities. This platform is opening up new financial markets across the globe.

    The platform unlocks data on informal and small business borrowers making it possible for lenders to offer loans to the informal traders. LendLedger seeks to bridge the $2.6 trillion lending gap between the institutional lending capital and informal borrowers. The aim of the platform is to come up with a lending market that is both inclusive and profitable for all the participants.

    Leading Crypto-Backed Lending Networks Join Forces To Unlock Mass Adoption (Payment Week) Rated: B

    Etherisc, the global, decentralized insurance platform for collectively building insurance products, has announced the launch of a blockchain consortium to create Collateral Protection Insurance (CPI) for the crypto lending market. The consortium aims to address a current, significant barrier to mass adoption by facilitating safe participation in crypto lending, clearing the way for more institutional players to enter the market.

    The founding members of the lending consortium include bZx, formerly b0x, a decentralized margin lending protocol and liquidation oracle marketplace; Celsius Network, a peer-to-peer decentralized borrowing and lending platform; Colendi, a comprehensive credit scoring protocol and microcredit platform; ETHLend, a peer-to-peer lending smart contract on the Ethereum blockchain for lending ether; Lendroid, a unique non-custodial lending platform working to enable a range of collateralized loans, advanced auction markets and trust-independent margin trading; Libra Credit, a lending ecosystem that facilitates open access to credit; Nexo, a platform for instant crypto-backed loans, powered by the 10-year-old leading European FinTech group Credissimo; Ripio Credit Network, a protocol based on smart contracts and blockchain technology, which brings enhanced transparency and reliability in credit and lending; and Sweetbridge, a blockchain-based economic framework that transforms supply chain, logistics, and unleashes working capital.

    European Union

    Germany’s crowdfunding market reaches $ 588 million (Business Insider) Rated: AAA

    At the end of June 2018, small- and medium-sized businesses (SMBs) in Germany had raised €500 million ($588 million) using equity crowdfunding and crowdlending marketplaces, according to a report from crowdfunding.de.

    Source: Business Insider

    Here are a couple of key takeaways from the report:

    • Real estate companies use crowdfunding most. Real estate accounted for over half, 53.3% of all the crowdfunding in Germany, making it the most common segment to opt for this funding method. It was followed by enterprise with a 42.6% share of funding raised and energy at 3.8%. Other segments combined only had a 0.3% share, showing that crowdfunding is largely dominated by two areas. However, as crowdfunding becomes more popular, we might see other sectors increasingly choosing it.
    • Unsurprisingly, a digital real estate investment provider had the largest share of funding among platforms. Germany-based Exporo raised 32.3% of the total, followed by UK-based Funding Circle with 14.4%. This shows that foreign companies also have a lot to gain from Germany’s crowdfunding market.

    Read the full report here.

    Australia

    Robo-advice users in for the long haul (Financial Standard) Rated: A

    Insights from the automated investment platform show 36.5% of its users are attempting to grow wealth outside of super, while 28.6% are using it to accrue retirement savings.

    The top reasons driving use of automated investment and advice platforms were lower fees and investment diversification, highlighted by 18.3% and 16.7% of users respectively.

    Viewing the data through a gender lens, half of Six Park’s female clients are checking the progress of their portfolios at least once a month and their most common goal is the ability to purchase a property in the near-term; 25% of females flagged this, compared to just 10% of men. In contrast, more than half of Six Park’s male clients are checking their portfolios on a daily or weekly basis.

    Latin America

    Local leaders in Brazil look for investments in social impact (Impact Alpha) Rated: AAA

    At the country’s first social finance forum in 2014, you could count the participants on one hand. All of them were in Rio and Sao Paulo. Equity crowdfunding and peer-to-peer lending were still in regulatory review. Few universities included social finance in their curriculum. All of that has changed. Today:

    Asia

    Credit manager AsiaCollect picks up $ 4.5m funding (FinTech Futures) Rated: AAA

    Singapore-based credit management services (CMS) provider AsiaCollect has raised $4.5 million to date after closing its recent investment round led by SIG Asia Investments.

    Dymon Asia Ventures, the venture capital arm of Dymon Asia Capital, a Singapore-based alternative investment management firm, returned to co-invest in this round after investing $1 million in AsiaCollect’s pre-series A equity round in August last year.

    AsiaCollect offers CMS outsourcing, CMS advisory services, debt purchasing, and Software-As-A-Service (SaaS).

    Authors:

    George Popescu
    Allen Taylor

    Tuesday May 1 2018, Daily News Digest

    Pace of Mobile Payment Adoption in China

    News Comments Today’s main news: Former SoFi CEO Mike Cagney raises $50M for blockchain-based Figure. RateSetter IFISA attracts ‘high tens of millions’ of GBP. Brazilian online lender Agibank files for IPO in São Paulo. Today’s main analysis: The cities with the highest rates of mortgage denials. Today’s thought-provoking articles: Hedge funds are down in Q1. MPL’s new ways look […]

    Pace of Mobile Payment Adoption in China

    News Comments

    United States

    United Kingdom

    China

    International

    Other

    News Summary

    United States

    SoFi’s Former CEO Harnesses the Blockchain for Home Loan Startup (Bloomberg) Rated: AAA

    Mike Cagney, who built SoFi into America’s biggest student loan refinancer before quitting amid allegations of sexual harassment at the fintech firm, is preparing for his second act: a startup offering home-equity loans.

    Cagney has raised $50 million for San Francisco-based Figure, which plans to use the blockchain to help expedite loan approvals in minutes rather than days, according to people familiar with the matter. Two global banks have agreed to finance loans and several firms have agreed to purchase them, say the people, who requested anonymity to discuss a private matter.

    CHINA-US TRADE WAR AND OTHER WORRIES (All About Alpha) Rated: AAA

    The Eurekahedge April 2018 report says that hedge funds were down in the first quarter of the year (-0.13%). This is the industry’s worst performance since Q1 2016.

    The steepest performance-based losses by regional mandate were those of the North American funds, they lost $1.2 billion. Meanwhile, asset inflows remained net positive but were lower (17% lower) than were the net asset inflows for the first quarter 2017.

    The highest performance gains by regional mandate were those of the Asia ex-Japan funds. (+0.5%). But those hedge funds were down in March, largely on rumblings of a US/China trade war.

    Total assets under management for the global hedge fund industry are now at $2.48 trillion.

    Marketplace Lending’s New Ways Look a Lot Like the Old Ones (Bloomberg) Rated: AAA

    Last week, the Federal Trade Commission accused LendingClub, the largest of the peer-to-peer lenders, of misleading consumers with hidden fees and continuing to charge borrowers even after they had paid off their loans. Shares of the online lender fell to nearly $2.50, its all-time low.

    Source Bloomberg

    In the first quarter, peer-to-peer lenders sold $4.3 billion in asset-backed securities, according to industry tracker PeerIQ. That was slightly down from $4.4 billion in issuance in the last three months of 2017, which was a quarterly high for the industry. PeerIQ estimates that peer-to-peer ABS securitization will hit $18 billion this year, up from $14 billion in 2017.

    Source: Bloomberg

     

    LendingTree Reveals the Cities With the Highest Rates of Denied Mortgage Applications (Lending Tree) Rated: AAA

    LendingTree delved into data from more than 10 million mortgage applications using the most recent available Home Mortgage Disclosure Act data set to find out the main reasons would-be borrowers were rejected.

    Key findings:

    • Nearly one in 10 borrowers get denied for mortgages. On a national level, 8% of loan applications were denied.
    • Credit history and debt are the biggest barriers. The leading reasons for denial were credit history (which includes credit score) and debt-to-income ratio, which were each responsible for 26% of denied loans. These were followed by collateral at 17% and incomplete applications at 14%. All other reasons for denial were cited in less than 10% of denied mortgage applications.
    • Debt is a huge barrier to borrowers living in California. We found three California cities (Los Angeles, San Francisco, San Jose) had the highest share of borrowers who were denied because of their debt-to-income ratio.
    • Credit history is holding borrowers back in Louisville, Ky., Memphis, Tenn. and Philadelphia. Among failed applications in these three metros, we found the highest rates of denied borrowers due to their credit history.


    Memphis among top 10 cities for highest rates of denied mortgage applications, study says (Bizjournal) Rated: A

    Memphis-area mortgage applications are denied at a rate of 12 percent, the third-highest out of 50 cities in a study by LendingTree Inc., an online loan marketplace based in Charlotte, North Carolina.

    Houston among top 10 cities for highest rates of denied mortgage applications (Bizjournal) Rated: A

    The top reason for a mortgage denial in Houston was debt-to-income ratio, which is the share of monthly debt obligations in relation to monthly gross income. Most lenders want this number to be 43 percent or lower, per the report.

    Other Texas cities ranked quite lower than Houston on the list. San Antonio was No. 18 with an 8.05 percent rate, Dallas was No. 21 with a 7.58 percent rate, and Austin was No. 27 with a 7.05 percent.

    What’s next for Citi’s mobile app (Tearsheet) Rated: A

    Banking apps are now among the most widely and frequently used apps, along with weather and social media, according to Citi’s second annual mobile banking study, released Thursday.

    If that’s true — the study examines the behavior of some 2,000 U.S. adult consumers — that would mean people are checking their bank accounts more frequently than they use music, news and dating apps. Although, 20 percent of millennials actually use their mobile banking app while on a date, Alice Milligan, the chief digital client experience officer for Citi’s U.S. consumer bank, pointed out in a presentation of the results.

    Could the USPS Be a Short-Term Lender for the Underbanked? (Nonprofit Quarterly) Rated: AAA

    In this age of electronic communications, we often take the post office for granted, but it remains a powerful institution. As the US Postal Service (USPS) website indicates, 47 percent of the world’s mail volume is handled by the USPS; the website adds that if it were a private sector company, “the Postal Service would rank 37th in the 2017 Fortune500. In the 2017 Global Fortune 500 list, we ranked 99th.” The business employs over 500,000 career employees, has annual revenues of $69.6 billion, and operates 30,825 “retail offices” nationwide.

    It is this last aspect—the ubiquity of post offices across the nation—that has spurred legislation (Senate Bill 2755), introduced last week by US Senator Kirsten Gillibrand (D-NY), that would require every post office to provide basic banking services. Interestingly, the idea of post offices offering banking services is not new. From 1911 to 1967, post offices offered savings and deposit services for Americans (although not loan products). At one time, Americans held more than $3 billion in deposits through postal banking ($30 billion in inflation-adjusted 2018 dollars). Other countries, including Japan, Germany, China, and South Korea, continue to offer banking services through their postal networks.

    Daniel Maran of the Huffington Post explains that, “Under Gillibrand’s proposal, Americans could cash paychecks and deposit money in accounts free of charge at each post office location. Deposits would be capped at the larger of two amounts―$20,000, or the median balance in all American bank accounts. The postal banks would be able to distribute loans to borrowers of up to $1,000 at an interest rate slightly higher than the yield on one-month Treasury bonds, currently about 2 percent.” By contrast, a Pew Charitable Trusts report found that average payday loan of $375 typically costs a borrower $520 in interest and fees.

    Financial Engines Sold To PE Firm For $ 3 Billion, Plans To Combine With Edelman (Financial Advisers) Rated: A

    Financial Engines announced on Monday that it will be acquired by private equity firm Hellman & Friedman and combined with Edelman Financial Services.

    According to the announcement, Hellman & Friedman will make the acquisition in an all-cash transaction that values Sunnyvale, Calif.-based Financial Engines at $3.02 billion. Financial Engines shareholders will receive $45 per share in cash upon closing.

    Leading Robo-Advisors Post Negative First Quarter Returns (Financial Adviser) Rated: A

    The best taxable robo-advisor performers in the first quarter for total portfolios were SoFi, which posted a loss of 0.14 percent; Schwab, which returned a negative 0.33 percent; and TIAA’s socially responsible portfolios, which posted a 0.45 percent loss.

    The top-performing taxable robo-advisors for total portfolios over the two-year duration of Backend Benchmarking’s study are Schwab, offering 10.98 percent annualized two-year returns; SigFig, which returned an average of 10.71 percent annually over two years; and Betterment, which returned 10.24 percent.

    MetaBank, CURO to offer flexible credit to underbanked (Bankless Times) Rated: A

    MetaBank, a provider of payment, community banking and financing solutions, today announced an agreement with CURO, a facilitator of short-term credit to underbanked consumers. Together, the organizations will launch a new line of credit product the parties believe will be more flexible and transparent than others in the market, and well-suited for US-based underbanked consumers. CURO and Meta expect to unveil the new, joint brand and a timeline for the pilot launch later this year.

    Through the credit option expected to be launched by CURO and Meta, underbanked consumers would be able to access credit with a flexible timeline for repayment. These consumers would also be able to control their cost of borrowing through transparent fees that would apply only when credit is drawn. Estimates indicate 67 million adults are considered un- or underbanked. Many of these adults typically have poor credit ratings and, as such, have difficulty securing credit or loans — this product is expected to provide a responsible credit option for many of those consumers.

    LendingTree, Inc. to Present at SunTrust Robinson Humphrey Internet & Digital Media Conference (Benzinga) Rated: B

    LendingTree, Inc. (NASDAQ:TREE), operator of LendingTree.com, the nation’s leading online loan marketplace, today announced that it will participate in the SunTrust Robinson Humphrey Internet & Digital Media Conference at The Palace Hotel in San Francisco, California.

    Trent Ziegler, Vice President of Investor Relations and Treasurer at LendingTree, is scheduled to present on Tuesday, May 8, at 9:10am PT and will participate in one-on-one meetings throughout the course of the day. The presentation will be webcast live and archived at 

    8 Side Hustles You Can Start Today (NAV) Rated: B

    If you’re looking for a way to grow income over time, and don’t mind the risk and reward nature of investment, peer to peer (P2P) can be a great way to earn some passive income on the side.  Operating much like a bank loan — but without the bank – P2P lending connects people with money (even if it’s only a few hundred dollars) with people who need it.

    United Kingdom

     

    RateSetter IFISA has attracted ‘high tens of millions’ of pounds (Peer2Peer Finance) Rated: AAA

    RATESETTER has revealed that its Innovative Finance ISA (IFISA) has already attracted “high tens of millions” of pounds from investors, in less than three months since launch.

    RateSetter opened its IFISA to existing customers on 8 February and to new customers on 1 March. The platform previously reported that it had seen over 5,000 IFISA accounts opened in the first month.

    TransferWise founder Taavet Hinrikus invests in fintech chatbot Cleo (Tech Crunch) Rated: A

    Cleo, the London-based fintech that offers an AI-powered chatbot as a replacement for your banking apps, continues to put together an impressive list of backers. The startup’s early investors already include Entrepreneur First, Moonfruit founder Wendy Tan White, Skype founder Niklas Zennström, Wonga founder Errol Damelin, and LocalGlobe, the seed VC firm founded by father and son duo Robin and Saul Klein, amongst others. Now TechCrunch can reveal that TransferWise founder Taavet Hinrikus has become a Cleo  investor and advisor.

    Family Building Society And LendInvest Reduce Buy To Let Investment Rates (Residential Landlord) Rated: B

    Family Building Society and LendInvest have each reduced rates on a number of buy to let mortgage deals.

    Family Building Society slashed interest rates across its entire buy to let product range, whilst LendInvest has reduced rates on several of its buy to let deals.

    CrowdProperty names Mike Bristow as chief executive (Peer2Peer Finance) Rated: B

    CROWDPROPERTY co-founder Mike Bristow has been appointed as chief executive of the peer-to-peer property lender, taking over the reins from fellow co-founder Simon Zutshi.

    Bristow, who was also a non-executive director at CrowdProperty, had been acting as interim chief executive for around two months before taking on the role on a permanent basis, effective from 1 May.

    Zutshi has now been appointed as chairman of CrowdProperty.

    China

    Lessons From A Mobile Payments Revolution (American Banker) Rated: AAA

    According to the research firm eMarketer, 76% of Chinese smartphone users made a mobile point-of-sale purchase in 2017, compared with 25% of American users. In total, 61.8% of all such transactions globally are Chinese.

    Source: American Banker

    In the first 10 months of last year, China processed a whopping $12.8 trillion in mobile payments, according to the state-run news agency, Xinhua — 38% higher than for all of 2016.

    Though it’s not exactly an apples-to-apples comparison, the U.S. market in 2017 had just $49.3 billion in mobile point-of-sale transactions, according to Shelleen Shum, eMarketer’s forecasting director.

    Start with an oligopoly

    More than 90% of Chinese mobile payments run through Alipay and WeChat Pay, rival platforms backed by China’s two largest internet conglomerates — Alibaba, essentially the Amazon of China, and Tencent Holdings, owner of WeChat, the nation’s must-have messaging and social-media app with more than 1 billion users.

    Peering into the murky world of China’s online P2P sector (Asia Times) Rated: A

    During an 18-month period, Ezubo swindled up to 900,000 investors out of 50 billion yuan (US$7.7 billion).

    In one of the country’s highest-profile court cases, the founders of what was once China’s largest peer-to-peer lending platform, Ding Ning and his younger brother Ding Dian, were jailed for life last September.

    Another 24 executives were sentenced to prison terms, ranging from three to 15 years, after disbelieving depositors mounted unprecedented protests in fintech’s biggest scandal.

    “[Just] 500 P2P companies, out of the total 4,856, are likely to maintain their operations this year,” it added.

    Fincera Reports 2017 Year-end Financial Results (Digital Journal) Rated: A

    Fincera Inc. (”Fincera” or the ”Company”) (OTCQB: YUANF), a leading provider of web-based financing and ecommerce services for small and medium-sized businesses and individuals in China, today reported financial results for the year ended December 31, 2017.

    Full-year 2017 Financial Highlights

    • Income for the year ended December 31, 2017, increased 16.9% to RMB1.0 billion (US$156.7 million) from RMB875.9 million in the prior year.
    • Net loss improved to RMB8.4 million (US$1.3 million), from net loss of RMB12.3 million in the prior year.
    • Net cash provided by operating activities increased 148.4% to RMB2.1 billion (US$326.6 million) for the year ended December 31, 2017, from RMB859.2 million in the prior year. This increase resulted in a 63.6% improvement in the Company’s overall cash position to RMB1.3 billion (US$191.5 million) at the end of 2017, compared to RMB764.8 million at the end of 2016.

    Operational Highlights

    Loan transaction volume across all loan types for 2017 totaled approximately RMB26.8 billion (US$4.1 billion), compared to approximately RMB24.4 billion in 2016.

    Source: Digital Journal
    International

    Can FinTech Walk The FinTalk? (PYMNTS) Rated: AAA

    BLOCKCHAIN

    In January, the International Data Corporation (IDC) reported worldwide spending on blockchain solutions would increase to $2.1 billion in 2018 from $945 million in 2017 and will grow more than 80 percent year over year to reach $9.7 billion by 2021. Most of that spend will be concentrated in the U.S., with supporting use cases mostly related to financial services and cross-border settlement, for a grand total of $242 million in 2018.

    To put that into context, the IDC projected worldwide growth and spending on mobility solutions at 15 percent a year from a 2018 base of $1.6 trillion; on security-related hardware, software and services at 10 percent a year from a 2018 base of $91.4 billion growing to $120.7 billion in 2021 and on the Internet of Things at 14 percent a year from $772.5 billion in 2018 growing to $1.1 trillion in 2021.

    MARKETPLACE LENDING

    LendingClub was hit with a lawsuit by the Federal Trade Commission (FTC) last week over claims of “deceptive” practices.

    Following that news, LendingClub’s stock price took a nosedive. Yesterday, it was trading at an all-time low of $2.70.

    Launched in October of 2016, Marcus is Goldman’s $2 billion annual hedge on threats to its core commercial banking and trading businesses. Goldman Sachs reported on its Q1 earnings call that Marcus, since it launched, has originated $3 billion of new loans and taken in $9 billion of new retail deposits.

    DIGITAL BANKS

    If the blockchain is all about replacing the global financial system and marketplace lending is all about replacing traditional lenders, digital banks in the developed world are about upending the traditional banking ecosystem.

    Crypto lending may be risky, but these firms say they’ve solved the riddle (American Banker) Rated: A

    A new crypto lender, Nexo, will launch Monday in a market where existing participants have already withstood trial by fire.

    Such lenders extend credit to those who want to own digital currency, such as bitcoin and ether, and hold onto it long-term while investing it in real estate and elsewhere. But crypto lenders have been severely tested of late as digital currency prices dropped about 70% between December and February.

    Source: American Banker, Coindesk

    Nexo

    The team behind Switzerland-based Nexo runs a consumer lending operation called Credissimo that has made more than a million loans to consumers of up to $2,000 in Europe.

    Salt Lending

    Denver-based Salt Lending, which started crypto lending earlier this year, has made just under $40 million in loans and has had no losses, according to co-founder Blake Cohen.

    Unchained Capital

    Unchained Capital, which publicly launched in November, is originating “single-digit million dollars of loans per month,” according to CEO Joe Kelly. The typical loan size is $120,000; the average interest rate is 12%.

    RCN Partners with IdentityMind Global to Provide KYC and AML Compliance for Its Protocol (PRWeb) Rated: B

    IdentityMind Global today announced that Ripio Credit Network (RCN), a global peer-to-peer credit network based on co-signed smart contracts that connect lenders and borrowers located anywhere in the world, has partnered with IdentityMind to provide KYC and AML compliance support.

    Australia

    Research shows savings at online lenders (Broker News) Rated: A

    The company’s research shows the average customer of one of the big four banks can save more than $2,500 a year by switching to an online deal. This has increased from a year ago, when the potential annual savings were $2,250.

    Despite these savings and the fact most other services have migrated online, only 27% of consumers said they would take out a home loan with an online lender.

    India

    Fintech Startup MyLoanCare Raises Series A Funding (Inc42) Rated: AAA

    Gurugram-based B2C online loans marketplace MyLoanCare has secured $977.7K (INR 6.5 Cr) equity Series A funding from Ncubate Capital Partners, a private investment arm of SAR Group family office.

    The startup plans to use the funding for branding, technology augmentation and growth. MyLoancare also plans to enter new segments of the market including cards, savings and investments.

     

     

    Asia

    INDONESIAN fintech startup EmasDigi enables the investing in as well as buying and selling of gold through mobile applications with easy processes that require little time.

    The idea began with EmasDigi chief executive officer and founder Claudia Kolonas selling vouchers which gave people easier access to the gold trading market.

    EmasDigi is affiliated with PT PG Berjangka, which is registered and supervised by the Trade Ministry’s Futures Exchange Supervisory Board (Bappebti). This affirms EmasDigi’s commitment to consumer protection and ensures compliance with legal provisions in Indonesia.

    Fintech microfinance, the next opportunity (Prothom Alo) Rated: A

    Bangladesh is widely known as the origin of microfinance. The pioneer two NGOs, Grameen Bank and BRAC, have taken this poverty reduction tool to different places in the world, especially in Asia and Africa. This has been acclaimed by the United Nations and other international organisations. Certainly the objectives of microfinance have undoubtedly already been achieved.

    Microfinance was inaugurated in the 1980s for a specific, target group of people (given their poverty level). It doesn’t have the generalised character required to reach all people.

    Latin America

    Brazilian online lender Agibank files for IPO (Reuters) Rated: AAA

    Brazilian online lender Banco Agibank SA on Monday filed for regulatory clearance to launch an initial public offering (IPO), according to a securities filing.

    Agibank follows Banco Inter SA’s (BIDI11.SA) strategy of raising capital to fund its expansion and IT investments. On Monday, Inter made its debut in São Paulo stock exchange, in the first IPO by a Brazilian retail bank in nearly a decade. In late afternoon, Inter’s units were stable at 74 reais.

    The bank and its owner, Marciano Testa, will sell an undisclosed amount of preferred shares in the IPO.

    Canada

    Fintech Select Earns a Net Profit of $ 435k and Reduces Liability by $ 7.6m for the Year Ending Dec 31 2017 (Globe Newswire) Rated: AAA

    Fintech Select Ltd. (“Fintech Select” or the “Company”) (TSX-V:FTEC) is pleased to announce that its financial statements for the year ending December 31 2017 have resulted in a net profit of $435k. 2017 Financial Statements and Management Discussion & Analysis (“MD&A”) will be filed on SEDAR shortly.

    2017 Highlights

    • Reduced the Company’s liability by $7.6M including our unfavourable high-interest loan
    • Made a net profit of $435k for the year due to the reduced liability
    • Reduced interest rate of 24% per annum plus management fee to 12% on April 1, 2017, and further to 6% plus management fee on May 16 2017.
    • Raised $3.4M through two private placements in April and June of the year, and had access to un-restricted cash of $915k by December 31 2017
    • Increased its customer care service revenue
    • Established an advisory board with high skill sets in business and Cryptocurrency space
    • Filed a patent-pending for Cryptocurrency POS platform.
    • Developed and launched the Company’s first phase of the Cryptocurrency POS solution, which simplifies buying cryptocurrecny to the mass of consumers
    • Acquired software for P2P Micro Lending and initiated the project to work on required changes and enhancements to meet the regulatory required standards

    Authors:

    George Popescu
    Allen Taylor

    Friday November 17 2017, Daily News Digest

    consumer debt

    News Comments Today’s main news: Kabbage secures $200M credit facility from Credit Suisse for AI-based lending expansion. Consumer Financial Protection Bureau (CFPB) files suit against Think Finance. Royal Bank of Scotland to launch robo under NatWest brand. Hexindai names Citi depository bank for American Depository Receipt Program. ICICI Bank, Paytm partner on short-term credit. Today’s main analysis: PeerIQ Lending […]

    consumer debt

    News Comments

    United States

    United Kingdom

    China

    European Union

    International

    Australia/New Zealand

    India

    Asia

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    News Summary

    United States

    Kabbage gets $ 200M from Credit Suisse to expand its AI-based business loans (TechCrunch), Rated: AAA

    After picking up $250 million in equity funding from Softbank earlier this year, the small business loans and finance company Kabbage — which uses only algorithms and machine learning (no humans) to determine an applicant’s eligibility — is announcing another big infusion of money. The company is picking up $200 million from Credit Suisse in a revolving credit facility that it will use for loans.

    Specifically, Kathryn Petralia, who is the COO and co-founded the company with Rob Frohwein, said the funding will help the company increase the number of loans it can make to larger companies in the US. The average size of those loans will grow to “north of $200,000,” she said.

    DBRS Assigns Ratings to Kabbage Asset Funding 2017-A LLC (DBRS), Rated: A

    DBRS, Inc. (DBRS) assigned ratings to the following classes of loans extended by a group of lenders to Kabbage Asset Funding 2017-A, LLC (the Facility):

    — Up to $148,150,000 of Class A Loans rated A (sf)
    — Up to $24,868,000 of Class B Loans rated BBB (sf)

    The Facility is a warehouse financing arranged for the benefit of Kabbage, Inc. (Kabbage) to support originations of small business loan receivables. Kabbage acts as servicer for the Facility.

    Study suggests many borrowers bungle credit card debt consolidation (Credible), Rated: AAA

    Thanks in part to the rise of fintech companies that make loans online, more than 16 million Americans now have personal loans — an increase of 64 percent in the last five years.

    Payoff — a personal lender that specializes in helping consumers tackle credit card debt — says its internal data shows borrowers who paid off at least $5,000 in credit card balances between August 2016 and January 2017 saw a 40-point increase in their FICO score within four months.

    Cleveland Fed study: a cautionary tale

    One year after taking out a P2P loan, borrowers had credit scores that were 16 points lower than those of the non-P2P borrowers they were matched to, on average — an impact that persisted for four years, the authors said in their working paper.

    The study found no evidence that P2P lenders are providing access to credit for “underbanked” consumers — borrowers taking out P2P loans were obtain other credit from traditional banks at rates similar to other consumers.

    But a number of companies on the list, including Lightstream, BestEgg, LendingPoint, Earnest, and RocketLoans weren’t around in 2012, when the most recent loans studied by the Cleveland Fed researchers were made. Several others — including Avant, CommonBond, Pave, and Upstart — were just getting off the ground at the time.

    The growth in fintech lending has been a driver in overall personal loan growth, with 16.1 million consumers owing $106 billion in personal loan debt as of June 30, 2017. That’s up from the 9.8 million borrowers who owed $45 billion in personal loan debt in mid-2012.

    Fed flags online lending as subprime redux, but market hits back (Global Capital), Rated: A

    ABS participants, speaking with GlobalCapital this week, hit back at the report, written by Yuliya Demyanyk, senior research economist, Daniel Kolliner, research analyst, both of the Cleveland Fed; and Elena Loutskina a professor of business administration at the University of Virginia’s Darden School of Business, and contributing author at the Cleveland Fed.

    The authors challenge the belief that peer-to-peer (P2P) loans have expanded credit to borrowers with limited access to debt since the financial crisis.

    A central argument of the Fed’s report was that sector has not done much to expand access to debt for borrowers with low credit scores.

    In securitization, subprime consumer ABS has thinned since the crisis. For the five major credit card issuers, the years 2008-2016 saw revolving credit available to US borrowers with a Fico score of less than 660 reduced by approximately $142bn, according to data published by online lender Elevate earlier this year.

    Even portfolios backing recent marketplace loan ABS have a weighted average Fico score above 680, the level that defines so-called ‘near prime’ credits, despite the notable dip in collateral quality. Marlette, for example, had an average score of 705 for its most recent transaction which was priced in October, while Prosper had a weighted average Fico score of 709, according to data from Kroll Bond Rating Agency.

    PeerIQ Lending Earnings Insights Report (PeerIQ), Rated: AAA

    We are pleased to release our inaugural Lending Earnings Insights report.

    Below are some of the main themes that we explore in this tracker:

    • Large banks continue to retrench.  Wells Fargo’s loan portfolio is down $13 Bn YOY. Loss reserves are down at all major banks except at GS due to the ramp-up in their consumer lending portfolio. Goldman Sachs expects lending initiatives to add $2 Bn in revenue in the coming years. GS loan loss reserve increased 50% and GS had the highest improvement in ROE across its peer group.
    • Credit re-normalization trend continues remains a recurring theme across all major lending groups. Overall, loss-rates on recent vintages are increasing versus prior recent vintages, although performance remains stronger than pre-crisis levels.  Card issuers are increasing loan loss reserves at a higher rate than loan growth, indicating expectations of higher losses going forward. Discover and American Express increased loan loss provisions ~50% although loan growth is at 9% and 14% respectively.
    • Consumer installment lenders do not anticipate an increase in loss rates, after having recalibrated loss expectations and increased reserves in 2016. OneMain had the smallest increase in loss reserves at 4%.
    • Consumers now have access to greater supply of credit and credit demand continues to grow. Consumer average debt-to-incomes are below pre-crisis levels.
    • Several lenders cited the shifting competitive landscape and the role of technology in driving innovation and risk management. 
    • Where are we in the credit cycle? 
    Source: PeerIQ

    Goldman Sachs’ lending platform is booming (Business Insider), Rated: A

    Other banks may be tempted to emulate Goldman Sachs’ move into lending, but they should proceed with caution. Although consumer credit demand in the US 

    Source: Business Insider

    LendingTree Holiday Shopping Survey Suggests Bigger Budgets, Selfless Spending and Mobile Shopping Among Parents this Holiday Season (Business Insider), Rated: AAA

    LendingTree, the nation’s leading online loan marketplace, recently conducted its Holiday Shopping Survey among 1,050 Americans aged 25 to 55 with at least one child. The results show that people generally expect to give more than they expect to receive, and although only 55 percent of respondents have a set budget this holiday season, 76 percent plan to spend the same amount or more on holiday shopping compared to last year.

    According to the survey, the average holiday shopping budget across all age groups was $943, although 45 percent of respondents say they don’t have a set budget for holiday shopping this year. LendingTree’s 2016 holiday survey found that 56 percent of respondents planned to shop for the holidays without a pre-set budget.

    Additionally, 29 percent say they plan to spend more on holiday shopping in 2017 than they did in the 2016 holiday season.

    Source: LendingTree

    Parents are setting a low bar for their children’s gift giving abilities in 2017, with 68 percent of parents expecting to receive no gifts from or on behalf of their kids.

    Most parents (80 percent) plan to spend at least $100 per child this year while 37 percent of parents plan to spend at least $250 per child.  Although 62 percent of parents say they try to spend the same amount on each child, younger children have a slight advantage with 12 percent of parents admitting to spending more on younger children and only 6 percent of parents use a child’s behavior to dictate how much money is spent on their gifts.

    A debit card is the primary form of payment for holiday shopping for 46 percent of respondents, as well as the primary form of payment for across all groups. Second to debit cards, 29 percent designated cash as their primary form of payment, and only 21 percent are primarily credit card users – although credit cards are considered more secure than cash or debit cards. A recent CompareCards by LendingTree survey found that 66 percent of Americans think debit cards are as safe or safer than credit cards for payments, when in fact debit cards don’t offer the same consumer protections as credit cards.

    Respondents expect to do 50 percent of their shopping online and 34 percent of their shopping on their mobile phone. Millennials (age 35 and under) expect to do 40 percent of their shopping on their phone, the largest of any other age group.

    LendingTree Inc. (TREE) Breaks into New 52-Week High on November 16 Session (Equities.com), Rated: A

    Shares of LendingTree Inc. (TREE) broke into a new 52-week high yesterday, hitting a peak of $281.80. Shares closed at $279.40 after opening at $271.75 for a move of 2.83%. The company now has a market cap of $3.34 billion.

    Sharestates, America’s Private lender, Launches Their One Click Closing Option (PR Newswire), Rated: A

    Sharestates, an online real estate investment marketplace, announced today the launch of its new One Click Closing tool, a feature that will allow return borrowers to visit a page where they can upload all the details and documents required for a new loan, allowing for a seamless transfer of closing date information without further communications. The launch of this new tool coincides with the company’s overarching goal of providing borrowers with a streamlined funding process, while providing them the opportunity to solely focus on identifying viable real estate investment opportunities.

    Bitcoin Tax Laws Are A Nightmare So People Ignore Them (International Business Times), Rated: A

    A survey of 564 American bitcoin users by the online loan marketplaceLendEDU, revealed more than 35 percent didn’t plan to report bitcoin-related gains or losses on their tax returns. On average, respondents said the current fiat value of their bitcoin holdings were $2,930.85, although that will probably continue to rise along with bitcoin’s market price.

    The Best Personal Loans of 2017 (U.S. News), Rated: AAA

    Some of the most common requirements for a personal loan are:

    • Minimum credit score: Most lenders require that you have at least fair or good credit when applying for a personal loan. Each lender sets its own cutoff for what it considers to be excellent, good, fair or bad credit. In general, fair credit is a FICO score between 580 to 669 and good credit is a score between 670 to 739. Most companies require a score of at least 600, but some have greater requirements. A higher score will increase your ability to be approved, and the higher your score, the lower interest rate you’ll qualify for too.
    • Clean credit history: Lenders don’t like to see defaults, collections or bankruptcies. If you have one or more of these on your credit report, you might not be approved for a personal loan. If you’re approved, you may have to pay an exorbitant interest rate.
    • Stable employment: A lender needs to know that if it lends you money, you’ll have the means to repay it over time. Without a stable job, you could miss payments or default on the loan. Proof of employment validates your loan application.
    • Proof of identification: Lenders usually need to see proof of identification, such as a copy of your driver’s license or passport, before approving your loan. Identity theft is common and they want to prevent thieves from taking out loans under another person’s credit.

    Choosing a Personal Loan Company

    There are two types of lenders you can choose from: banks and peer-to-peer lenders. Banks offering personal loans include SoFi and LightStream and peer-to-peer lenders include Upstart, LendingClub, Prosper and Peerform.

    Marketplace-based lenders usually have less strict credit score requirements than their bank-based counterparts. For example, LendingClub and Peerform only require a FICO score of 600 while bank-based companies such as SoFi and Payoff have minimum FICO scores of 660.

    Every lender has a minimum and maximum loan amount. For example, SoFi will lend up to $100,000 while Payoff lends up to $35,000. If you need to borrow $45,000, then only look at lenders who offer that amount or more.

    Best Personal Loan Companies of 2017

    • Best for very good credit, low APR and no origination fees: LightStream
    • Best for very good credit, low APR, no origination fees and a range of offerings: SoFi
    • Best for very good credit and low APR with merit-based qualifications: Earnest
    • Best marketplace for fair to good credit with merit-based qualifications: Upstart
    • Best bank for fair to good credit with merit-based qualifications: LendingPoint
    • Best for fair to good credit with a co-signer option: LendingClub

    The Best Bad Credit Loans of 2017 (U.S. News), Rated: AAA

    Bad credit usually is a FICO score below 640. FICO is the main scoring system for consumer credit, with credit score rangesdefined as:

    • Exceptional (800 to 850)
    • Very Good (740 to 799)
    • Good (670 to 739)
    • Fair (580 to 669)
    • Very Poor (300 to 579)

    Payday Loans Versus Personal Loans

    Payday Loans Personal Loans for Bad Credit
    Lenders Online, brick-and-mortar Online, brick-and-mortar
    Loan Amounts Typically less than $500 $1,000 to $50,000
    Loan Terms Two to four weeks One to five years
    Interest Rates 200 to 400 percent APR 36 percent APR or less

    (Source)

    Some alternative payday loan companies market themselves as more socially responsible than traditional payday lenders because they offer better terms. They also want to help consumers rebuild their shaky credit and make payments on time. For instance, LendUp provides financial education and rewards existing borrowers who repay their loans to be eligible for loans at larger amounts and lower rates. Fig Loans only charges fees to cover the costs of the loan.

    Choosing a Bad Credit Lender

    Consumers should evaluate lenders based on the following criteria:

    • Type of lending company
    • Credit history and general qualifications
    • Co-signer option
    • Additional eligibility qualifications
    • Employment requirements
    • Interest rates and types
    • Loan terms
    • Fees and penalties
    • Repayment options

    The Best Small Business Loans of 2017 (U.S. News), Rated: AAA

    According to the National Small Business Association, 69 percent of small businesses used financing in 2016, including loans, credit cards, venture capital and crowdfunding. The remaining 31 percent were not able to obtain adequate financing.

    According to data from the U.S. Small Business Administration, small business bank loans totaled nearly $600 billion in 2015. At the same time, lending from alternative sources such as finance companies and peer-to-peer, or P2P, marketplace lenders amounted to $593 billion.

    There are two categories of alternative lenders, direct and peer-to-peer lenders:

    1. Direct lenders: Direct lenders are finance companies that fund your loan with capital other than a bank and without a middleman such as a broker, investment bank or private equity firm. Some direct lenders, such as LiftFund, offer SBA loans. Typically, small to midsize businesses borrow from direct lenders.

    2. Peer-to-peer lenders: Online peer-to-peer lending directly connects you with investors who usually have a diversified loan portfolio made up of small portions of loans. A loan is often divided among several investors.

    Choosing a Small Business Loan

    Eligibility Requirements:

    • Minimum credit score
    • Minimum years in business
    • Minimum annual revenue

    Best Small Business Loans of 2017

    • Best for very small businesses: Kabbage
    • Best for borrowers with low credit scores: OnDeck
    • Best for new businesses: Accion
    • Best for low APR: LendingClub
    • Best for invoice financing: Fundbox

    Square Now Letting Some Users Buy & Sell Bitcoin Through Cash Mobile App (Crowdfund Insider), Rated: A

    Financial service company Square is reportedly now testing out bitcoin on some of its Cash mobile app users. The new feature will allow users to buy and sell the cryptocurrency through the app.

    YieldStreet Surpasses $ 200M in Originations, Bolsters Leadership Team and Launches New Website amid Period of High Growth (BusinessWire), Rated: A

    YieldStreet, the alternative investment platform that is working to change the way wealth is created, announced that it has surpassed $200 million in originations and has added two new executives to its leadership team: Volfi Mizrahi as Managing Director of Originations and Ivor Wolk as General Counsel. Their additions come on the heels of the appointment of Hrishi Dixit as CTO earlier this year.

    $ 15 Million Investment Round Fuels Accelerated Growth at Goji (PR Newswire), Rated: A

    Goji announced a $15 million investment round led by Hudson Structured Capital Management Ltd., doing business as HSCM Bermuda.

    CFPB Guns for Think Finance. Files Suit Alleging Consumer Deception in Repaying Loans Not Legally Owned (Crowdfund Insider), Rated: AAA

    The Consumer Financial Protection Bureau (CFPB) has filed suit in federal court against Think Finance, a Fintech that leverages its technology to power online lending platforms. The CFPB says the suit was filed for its “role in deceiving consumers into repaying loans that were not legally owed.”

    The CFPB alleges that Think Finance illegally collects on loans that are void under state laws governing interest rate caps or the licensing of lenders.

    The actual filing states:

    “From 2011 through at least 2015, Defendant has performed critical functions for three separate lending businesses owned by Native American Tribes: (1) Great Plains Lending, LLC (Great Plains); (2) MobiLoans, LLC (MobiLoans); and (3) Plain Green, LLC (Plain Green) (collectively, the Tribal lenders). Defendant is therefore a “service provider” under CFPA. 12 U.S.C. § 5481(226).”

    Read the filing here.

    Richard Cordray’s CFPB Has Done Its Job Well (Bloomberg), Rated: A

    As recently as a decade ago, the U.S. had no single regulator tasked with looking out for the interests of consumers in financial markets. Fragmented oversight allowed all kinds of bad behavior to fall through the cracks. Mortgage brokers hid the true terms of loans in piles of nearly indecipherable documents. Banks changed the order of transactions to extract the maximum overdraft fees from poor customers. Payday lenders offered products designed to trap people in an unending cycle of debt.

    Cordray has accomplished a lot. The CFPB designed new, simpler mortgage-loan disclosures. It shed light on banks’ overdraftpractices. It created the first federal rules to make payday lending less predatory. It gave the public reams of valuable information, such as a database that allows consumers to compare credit-card agreements. Its practice of publishing complaints pushed financial institutions to be more responsive. Its investigation of Wells Fargo brought national attention to the fake-accounts issue.

    Some of its practices (in particular, preferringdiscretionary enforcement over explicit rule-making) are less than ideal and ought to be revisited; in other areas (such as auto lendingand credit reporting) its authority should be expanded.

    We need a watchdog at Consumer Financial Protection Bureau (Washington Post), Rated: A

    Cordray’s departure gives President Trump an opportunity to appoint a new leader, and I’m concerned that this will derail the watchdog agency’s consumer-first mission.

    In Cordray’s parting statement, he wrote that the agency has recovered $12 billion for nearly 30 million consumers.

    Five opportunities and challenges in digital lending (American Banker), Rated: A

    Despite the rapid growth of online and mobile lending in recent years, many banks are still just getting started.

    Traditional banks should help govern fintech (Reuters), Rated: A

    Traditional lenders should demand that online financial companies protect consumer privacy and money interests, Federal Reserve Governor Lael Brainard said on Thursday.

    Banks often pay tech companies for the information they gather on borrowers. For that reason, Brainard said, those lenders can set high standards in consumer protection and privacy.

    Under Trump, Banking Watchdog Trades Its Bite for a Tamer Stance (The New York Times), Rated: A

    The regulator, the Office of the Comptroller of the Currency, which oversees the nation’s biggest banks, has made it easier for Wall Street to offer high-interest, payday-style loans. It has softened a policy for punishing banks suspected of discriminatory lending. And it has clashed with another federal regulator that pushed to give consumers greater power to sue financial institutions.

    Buffett’s ‘Million-Dollar Bet’ shows how much fees matter (Herald Tribune), Rated: A

    One category of alternative investments includes hedge and private equity funds. I am not in favor of such investments, especially for the average investor, and I am not alone.

    Typically, hedge fund fees are 2 percent plus an incentive, or “carry,” of 20 percent of the profits. The result is billions of dollars for the managers and far less for clients.

    In 2015, Buffett lagged his hedge fund rival for the first time since 2008, gaining 1.4 percent versus Protégé’s 1.7 percent. However, 2016 saw Buffett gain 11.9 percent to Protégé’s 0.9 percent. At the end of 2016, Buffett’s index fund gained 7.1 percent per year, or $854,000 in total, compared with 2.2 percent per year, or $220,000, for Protégé.

    United Kingdom

    Royal Bank of Scotland to launch robo-advice under NatWest brand (Financial Times), Rated: AAA

    Royal Bank of Scotland is launching robo-advice for more than 5m customers as banks return to the investment market after a string of fines and as regulators attempt to plug the UK’s wide “advice gap”.

    The state-backed lender is claiming to be the first in the UK to launch automated online investment advice when it opens on Monday under its NatWest brand. The service is designed for the majority of customers and for people with as little as £500 to invest as a lump sum.

    The process, which costs £10 plus fees for the investment, is aimed at customers who lack the confidence to invest alone but do not wish to pay higher charges for full-blown financial advice, such as tax and inheritance planning.

    Beyond the bank (Prospect Magazine), Rated: AAA

    Five high street banks remain responsible for more than 80 percent of business lending, prompting calls for greater market choice both from challenger banks and from emerging FinTech (financial technology) firms. However, the introduction of new platforms and new players raises questions of integration, innovation and regulation.

    Launched seven years ago, Funding Circle has since hosted 70,000 lenders and is responsible for 2 percent of total UK business lending. While going head-to-head with the banks it is worth noting that Funding Circle is also growing the market.

    So what next for financial services? Will the disruptors get disrupted? Possibly. One attendee suggested that FinTech firms would soon be providing ‘white label’ versions of their services to traditional banks that would then offer those services to customers. Others suggested that the likes of Amazon and Google would provide the biggest future threat not just to banks but to today’s FinTech leaders.

    RateSetter, Funding Circle, Zopa feature in Women in Fintech Powerlist (P2P Finance News), Rated: A

    FEMALE employees at RateSetter, Funding Circle, Zopa and Landbay have all made this year’s Women in Fintech Powerlist, which celebrates the achievements and talent of women across the sector.

    RateSetter’s entrants are: Alexa McAlister, head of partnerships; Angela Yotov, head of legal; Joanna Wright, chief risk officer; Katie Brown, corporate counsel; Laurence Perrin, head of compliance; Lucy Bott, head of customer operations; and Maud Holma, finance counsel.

    Women from Funding Circle who made the list are: Alysha Randall, global finance director; Lisa Jacobs, chief strategy officer; Lucy Vernall, global general counsel and global head of compliance; Maria Weaver, chief people officer; Panni Morshedi, managing director of international; Swati Lay, chief information security officer; and Vittoria Reimers, VP loan operations.

    VPC takes majority stake in online lender Borro (P2P Finance News), Rated: A

    VICTORY Park Capital Specialty Lending (VPC) has continued its expansion into balance sheet lending by upping its investment in online secured lender Borro.

    The alternative finance-focused investment trust now has the largest stake in the firm, which provides loans secured on luxury assets, owning around 49 per cent.

    How does LendInvest’s buy-to-let offering stack up to P2P rivals? (P2P Finance News), Rated: A

    LendInvest said it will be offering buy-to-let loans through intermediaries ranging between £50,000 and £5m, with rates starting at 3.69 per cent depending on whether borrowers take a two, three or five-year fixed rate.

    In comparison, Landbay facilitates fixed rate and tracker buy-to-let loans of between £70,000 and £500,000 from 3.55 per cent.

    And fellow P2P lender LandlordInvest offers loans of between £30,000 and £300,000 from five per cent.

    Crowdproperty Pitches to Raise 600K GBP through Equity Crowdfunding (P2P-Banking), Rated: A

    UK p2p lending marketplace Crowdproperty is currently pitching on Seedrs to raise 600K GBP from the crowd at a pre-money valuation of 5.9M GBP.

    Digital bank Monzo sizes up IPO (AltFi), Rated: A

    In an advertisement for a new Chief Financial Officer, Monzo has let on about its plans for an IPO within three to four years time.

    The posting, published today on Monzo’s job site, says:

    Alongside the CEO, you’ll be heavily involved in future capital raising – pitching to investors and negotiating the best terms. In the next 3-4 years, it’s likely you’ll be responsible for taking the company through an IPO.

    UK FinTech Beats Brexit Blues with New Funding Record (Digit), Rated: A

    The UK fintech sector has enjoyed a record year of investment in 2017 with more than £2 billion invested across 182 deals, according to research body FinTech.Global.

    Additionally, the compound annual growth rate (CAGR) of 10.7% experienced by firms valued below £75 million between 2014 and 2016 was supplemented with a further investment of £1.2 billion for this bracket in 2017. As for companies valued above the £75 million figure, a further £877.1 million has been committed across eight deals.

    Investment in the UK’s top-10 fintech firms accounted for nearly 46.7% of the total investment between Q1 and Q3 2017. The largest of these deals went to Gryphon Insurance in June, valued at £179.6 million. Of the top 10 deals, four went to lending firms – Prodigy Finance1stStop GroupNeyber and Funding Circle, valued at £457.5 million. Of the remaining six deals, two went to challenger banks Tandem and Atom, two went to enterprise software companies Options Technology and Darktrace, and the final two went to insurtech companyies Gryphon Insurance and Revolut.

    Millennials say advisers are inaccessible and too expensive (Financial Times), Rated: A

    Millennials view financial advice as an industry of “exclusivity, inaccessibility and high cost,” according to research carried out by the financial advice trade body.

    The poll of 178 millennials found 78 per cent of them believed they could only receive advice if they had investible wealth in excess of £50,000 but a significant number wanted advice when they had £10,000 or less.

    Online-only options appealed to just 12 per cent of those surveyed.

    Cardiff will host one of the first a new network of tech hubs being set up in a £21m investment (Wales Online), Rate: B

    A new tech hub will be set up in Cardiff as part of a UK-wide network of regional hubs under a £21m investment announced by the UK Government.

    China

    P2P Lender Hexindai Names Citi As Depositary Bank for American Depositary Receipt Program (Crowdfund Insider), Rated: AAA

    On Wednesday, Chinese peer-to-peer (P2P) lending platform Hexindai announced it has appointed Citi’s Issuer Services business as the depositary bank for its American Depositary Receipt (ADR) program. According to the online lender, the program was established through an initial public offering of its American Depositary Shares (ADSs), priced at $10 per ADS, which raised approximately $50 million.

    Unified credit rating system expected soon, say experts (China Daily), Rated: A

    A unified platform for collecting personal financial information and assessing people’s credit ratings is being planned, and it is expected to be launched soon as a part of the central bank’s regulatory framework, experts told China Daily.

    It will complement the existing credit center of the People’s Bank of China, the nation’s central bank.

    China Fintech Companies Dominate Top-10 List of Global Innovators (China Money Network), Rated: B

    Compared with the ranking last year, two more Chinese firms were added to the top 50 list. Online marketplace lending company Dianrong and credit card and online financial service firm U51.com, or 51Xinyongka, rose to top 50. Among the 100 fintech companies, lending and payments focused companies lead in terms of sectors.

    European Union

    Online Lender WeShareBonds Raises €12 Million in Mission to Help Finance French SMEs (Crowdfund Insider), Rated: A

    WeShareBonds, an AMF-registered crowd lending platform, has raised €12 million to continue financing French SMEs. The new funding includes both the closing of WeShareBonds’ second credit fund (Prêtons aux PME 2018) to finance French SMEs for €10 million and an equity increase of €2 million to finance platform growth.

    International

    Peer to Peer (P2P) Lending in India: A positive disruption to traditional financing, albeit cautious approach required (CARE Ratings), Rated: AAA

    The overall size of the NBFC sector in India has grown significantly during the last few years with increasing share of NBFC total assets to bank total assets (approximately around 15 per cent of the total banking assets).

    P2P Lending in UK: In UK, the P2P market has seen active retail investor participation. The outstanding loan book in the UK industry is approximately around £2.9 billion (~Rs.25,000 crore) as on Q3-2017 as compared to £0.75 billion (~Rs.6,500 crore) as on Q4-20142 . Based on the outstanding loan book as on Q3-2017, the key players in the segment are Funding Circle, Zopa, FolktoFolk, Ratesetter and ThinCats capturing majority of the market.

    P2P Lending in USA: P2P industry in USA is around $20 billion (~Rs.1.3 trillion) in 2016 up from $18 billion in 20153 . P2P lending in the USA has seen active participation of institutional investors (approximately 70 per cent of the total investor volumes) lending to borrowers through the platforms. In the USA, three dominant players capture majority of the market which include Lending Club, Prosper and Sofi.

    P2P Lending in China: Globally, China has the largest market size of P2P lending which started in 2006. As of January 2017, there were total 2388 P2P platforms in China4with trading volume in 2015 touching $67 billion (~Rs.4.4 trillion) which is ten times that of UK and four times bigger than USA. However unlike USA and UK, the China P2P market is dominated by large number of small and medium size firms.

    P2P Lending in India: Globally P2P lending has been in existence for more than ten years; however, it has been evolving in India in the last couple of years. Given the recent RBI guidelines, companies will now need to obtain NBFC–P2P license and will come under the purview of the regulator. There are more than 50 P2P online platforms operating in India. I-Lend, LenDenClub, Faircent, Lendbox, i2iFunding, Monexo, India Money Mart, Rupaiya Exchange are some of the leading P2P platforms operating in India. Currently, some of the leading P2P platforms claim to disburse loans amounting to ~Rs.1 to 2 crore a month. Outstanding loans under P2P model is estimated to have reached ~Rs.50-60 crore.

    Source: CARE Ratings

    Read the full report here.

    TAURUS COIN OPENS FOR BUSINESS GLOBALLY (EIN News), Rated: A

    United Kingdom’s leading peer to peer cryptocurrency lender Taurus Coin today launched its online lending marketplace with USD 150M lending capital, bringing the world’s fastest growing form of lending to the South-East Asia, Gulf, Africa, Europe, and India investors.

    Australia/New Zealand

    Sharesies to look at robo-advice once regulator rules on exemptions (The National Business Review), Rated: A

    Start-up fund distribution platform Sharesies will develop a plan to provide personalised, automated financial advice, known as robo-advice, once there is more clarity about regulatory exemptions.

    Last month the Financial Markets Authority decided to grant an exemption to enable the provision of robo-advice services under the current financial advice regime and said it aims to finalise the exemption and be open for applications in early 2018.

    India

    ICICI Bank and Paytm partner for short term credit for users (Medianama), Rated: AAA

    ICICI Bank and Paytm have partnered to offer short-term credit to users. The credit given to customers will be interest-free for 45 days and the bank says that it will give loans up to Rs 20,000. Initially, this will be allowed for select ICICI Bank customers who are on Paytm and will be extended to other bank customers as well who use Paytm.

    Once the credit limit is set up for a customer, a consolidated bill is generated on the first day of the next month, which has to be paid by the 15th day of the same month. Customers can use their Paytm Wallet, debit card or internet banking of any bank for an easy repayment of their dues.

    In August, the bank launched product called Instant Credit Card where certain pre-approved customers of the bank will be able to get a virtual credit card much before the physical card is delivered to them. A physical card will be sent to the customer’s address in 5-7 days.

    Meanwhile, the bank’s rival, HDFC Bank said that it would start offering a virtual credit card for customers through its PayZapp wallet, as indicated by this Financial Express report. HDFC Bank has the maximum number of credit cards in circulation with 9.03 million. Meanwhile, ICICI Bank has 4.34 million credit cards.

    • Paytm’s rival in the wallet space, MobiKwik has partnered with Bajaj Finance to to bring in credit facilities to a wallet business.
    • In April this year, PayU India will be investing $50 million in its product LazyPay over the next few years. The credit facility could extend for amounts from Rs 3,000 and even up to Rs 10,000, depending upon customer behaviour.
    • For the recently concluded festival season, e-commerce player Flipkart started to offer EMIs on debit cards on high-value purchases.

    Narrow banking is an idea whose time has come (livemint), Rated: A

    The most heartening takeaway from last week’s public sector bank executive jamboree was the discussion around differentiated lending structures. The ThinkShop (earlier editions were called Gyan Sangams) suggested that large banks focus on corporate lending, while smaller lenders focus on retail loans or specific geographies.

    Taking differentiated lending to its logical end, the time has come to consider converting the worst performers among state-owned lenders to narrow banks, which won’t lend at all.

    Narrow banks are safe banks. By not lending, and using their deposits to buy government bonds, they carry virtually no credit risk. There is no danger of non-performing loans and frequent injections of equity capital that has to be funded by taxpayers. For the Reserve Bank of India (RBI) too, supervision gets easier. There is no need for deposit insurance.

    RBI likely to issue clarifications on P2P lending norms soon (Money Control), Rated: B

    The Reserve Bank of India is soon likely to issue clarifications on the guidelines for peer-to-peer (P2P) lending platforms relating to the lending limits, trusteeship and other operational norms.

    Asia

    Active.Ai raises over million in Series-A round (India Times), Rated: A

    Singapore-based fintech platform Active-.Ai has raised $8.25 million in a series-A round, which was led by Vertex Ventures, Creditease Holdings and Dream Incubator. Existing investors Kalaari Capital and IDG Ventures also participated.

    Canada

    WEALTHSIMPLE, LEAGUE AMONG KPMG’S TOP 50 FINTECH COMPANIES (Betakit), Rated: B

    Toronto-based WealthsimpleLeague, and SecureKey were among the company recognized in the top 50 category. In the emerging stars category, Toronto-based BorrowellWave, and Sensibill were recognized.

    The list was put together by FinTech investment firm H2 Ventures and KPMG FinTech.

    Authors:

    George Popescu
    Allen Taylor

    Volumes: Monthly P2P, marketplace and alternative credit origination volumes

    Volumes: Monthly P2P, marketplace and alternative credit origination volumes

    Lending Times has started a new initiative of publishing monthly volumes of the P2P, marketplace, and alternative credit space. We believe that our volume report will be a proof of the industry’s transparency and will help promote our industry. The volume report will also help lenders stand to be more visible to potential investors and […]

    Volumes: Monthly P2P, marketplace and alternative credit origination volumes

    Lending Times has started a new initiative of publishing monthly volumes of the P2P, marketplace, and alternative credit space.

    We believe that our volume report will be a proof of the industry’s transparency and will help promote our industry. The volume report will also help lenders stand to be more visible to potential investors and lending capital sources.

    An excel file with the entire historic volume data is available for download here.

    Firm Currency Country July 2016 August 2016
    Arboribus EUR Spain                  535,690
    Capital Match SGD Singapore               1,910,700               1,786,400
    CreditGate24 USD Switzerland, Rüschlikon                  870,000
    Crowdhouse USD Zurich, Switzerland               3,500,000
    CrowdProperty GBP London, UK                  210,000
    Dianrong.com RMB Shanghai, China         1,300,000,000         1,370,000,000
    Fellow Finance EUR Helsinki, Finland               3,577,776               5,054,475
    FinBee USD Vilnius, Lithuania                  320,640
    Finexkap EUR Paris, France               3,067,736
    Funding Societies USD Singapore                  200,000
    GyanDhan USD Delhi, India               1,300,000               1,500,000
    Investly EUR Estonia                  346,813                  347,047
    Investly GBP UK, London                    29,668                    25,433
    Lendahand EUR Netherlands, Rotterdam                  597,300                  584,000
    Lendino DKK Danemark             33,089,000
    Lendix EUR France               3,733,568               2,056,920
    LoanZen.in USD India                    50,000                    99,000
    Mintos EUR Riga, Latvia               7,142,272               9,283,736
    Modalku USD Indonesia                  120,000
    Money Thing GBP UK, London               3,030,416               3,545,418
    MytripleA EUR Soria and Madrid, Spain                  548,100                  548,100
    Ovation USD Austin, TX             26,098,914
    Plataforma Grow.ly, S.L. EUR Spain, Madrid                  185,000  177,451
    SAVY EUR Vilnius ,Lithuania                  259,800                  249,500
    ThinCats UK GBP UK               4,726,000
    Twino EUR Latvia               8,308,804
    Validus Capital Pte Ltd SGD Singapore               1,465,000
    Viventor EUR Riga, Latvia               1,242,270
    Zltymelon.sk USD Czech and Slovak republics 124,575 195,585

    Publishing volumes with Lending Times is free.

    Lending Time’s focus is on accuracy. Therefore:

    1. We will publish the volumes on the 11th day of the following month. If the data is received later we will update the volume tables in an attempt for completeness.
    2. We will only publish numbers reported by the lenders themselves by email or on their websites.
    3. We are publishing all data in the original currency in order to avoid currency conversion effects on present and historical volumes.

    To include your company’s volumes in the report please email us, preferably before the 10th of each month, the following information:

    Company name
    Country and City
    Month
    Currency
    Volume ( in original currency)
    (and optionally, the previous month’s volumes going back since company
    creation)

    Please send your information to volumes@lending-times.com