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 […]

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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.

    Wednesday May 30 2018, Daily News Digest

    refinancing

    News Comments Today’s main news: GreenSky sets shares at $23 each, sold 38M. Elevate Credit doubles floor space. Tandem hits 100K clients. Lidya raises $6.9M in Africa. Today’s main analysis: PeerIQ recounts TransUnion Summit 2018. Today’s thought-provoking articles: An orthodontist racks up over $1M in student loans. CompareCards releases credit card fee report. The worst is over for Chinese microlenders. […]

    refinancing

    News Comments

    United States

    United Kingdom

    China

    Other

    News Summary

    United States

    Fintech GreenSky raises more than US$ 800mln in its IPO (Proactive Investors) Rated: AAA

    The online lender priced its shares at US$23 each, raising a total of US$874mln in its first day of trading. The company sold 38 million shares, surpassing its expectation of 34 million shares.

    Elevate Credit doubles space with ‘super floor’ in Addison office building (Dallas Business Journal) Rated: AAA

    Elevate Credit Inc. will expand at Spectrum Center in Addison, doubling both the size of its footprint and the capacity for employees who can work in the office.

    The fast-growing company is growing from 26,000 to 52,000 square feet in the 614,000-square-foot office complex.

    VantageScore win, TransUnion Summit 2018 (PeerIQ), Rated: AAA

    The House passed the Economic Growth, Regulatory Relief, and Consumer Protection Act which reforms the Dodd-Frank Act and provides significant oversight relief to small banks. Below are some of the main provisions of this bill:

    1. One of the most notable shifts lost in the headlines is that the legislation requires Fannie Mae and Freddie Mac to evaluate and consider alternative credit scores to FICO. The change introduces competition to the credit scoring market and is a big win for VantageScore.
    2. Regulatory Capital relief:
    3. The threshold for a Systematically Important Financial Institution has been raised to $250 Bn in assets from $50 Bn, which will exempt a number of regional banks. These banks will no longer be subject to onerous CCAR tests and reduce their compliance burdens. Banks with less than $10 Bn in assets are also exempt from the Volcker Rule – a win for Jeb Hensarling’s (R-TX) campaign to provide relief for community banks.
    4. Banks with less than $3 Bn in assets will have a lower frequency of regulatory exams, banks with less than $5 Bn in assets will have fewer reporting and compliance requirements, and all banks with less than $10 Bn in assets will have the same capital ratio.
    5. Lenders can now charge subprime borrowers higher rates for auto loans.

    TransUnion Financial Services Summit 2018

    Delinquencies in auto loans have picked up recently to 4.3%, with subprime auto doing worse. (The drop in auto performance can be attributed to longer auto loan terms, higher LTVs, lower used car re-sale prices, and the “Lyft effect”).

    Source: TransUnion

    If a loan is prepaid before the 12-months mark the originator loses money as the net interest margin is not enough to compensate for the origination and servicing expenses. Only 23% of prepaid loans are refinanced, and most consumers go for a longer tenor loan with a higher balance.

    Source: TransUnion

    Mike Meru Has $ 1 Million in Student Loans. How Did That Happen? (WSJ), Rated: AAA

    Due to escalating tuition and easy credit, the U.S. has 101 people who owe at least $1 million in federal student loans, according to the Education Department. Five years ago, 14 people owed that much.

    Silver Hill Funding’s Leslie Smith is Targeting the Underserved in the SBL Space (Commercial Observer) Rated: A

    In March, Smith oversaw the formal launch of Commercial Direct, an online small-balance loan customization platform that’s a division of multibillion dollar real estate investment firm Silver Hill Funding, a subsidiary of Bayview Loan Servicing.

    Commercial Direct’s lending strategy targets small business owners, entrepreneurs and investors who are relatively new to the commercial real estate arena or are looking to expand or diversify their portfolios. The platform finances commercial and residential condominiums, among many other asset classes, and closes loans in 30 days or fewer, according to Commercial Direct’s website.

    With the backing of Silver Hill—which has funded more than 20,000 transactions since its founding—and Bayview Loan Servicing, the platform is off to a strong start.

    Fintech adds another S.F. office (San Fransciso Business Journal) Rated: A

    After snapping up a new headquarters last year, fintech company Affirm leased up 46,000 square feet in 550 Kearny St. in San Francisco with landlord Brickman.

    The new space is around the corner from the company’s headquarters in 650 California St., where it leased 86,225 square feet.

    Does Your Business Need More Space? A Lender Weighs In On Why And How To Expand (Forbes) Rated: A

    In this post, I speak with Victoria Treyger of 

    For Your Money, Which is Better: The Algorithm or the Adviser? (Kiplinger) Rated: A

    The reality is, the rapid growth and early-stage adoption of financial technology (FinTech) indicates an industry disruption is underway. Algorithm-based, digital advisory technology has brought us the increasingly popular “robo-advisers,” which replace human advisers with software programmed to understand and advise on clients’ needs. Robo-adviser firms have witnessed triple-digit growth since 2013. Research firm Cerulli Associates reported they had about $60 billion in assets under management (AUM) at the end of 2016, and could amass an estimated $385 billion by 2021.

    Are we in the Golden Age of Fintech? (Fintech TV), Rated: A

    Dubbed the ‘Mayor of Fintech’, Ron Suber discusses the current fintech landscape, and what technology has him excited about the future.

    Watch this video interview with Ron Suber.

    Can your side gig fund retirement? (CU Insight) Rated: A

    Almost 40% of respondents in a recent Betterment survey said they feel unprepared to save enough to maintain their lifestyle during retirement. As a result, they have become members of the growing gig economy by either supplementing their full-time job or relying solely on their independent work/temporary contracts.

    According to “The Gig Economy and Future of Retirement” survey, 76% of those 55 and older were using earnings from a second job to save for retirement, as were 65% of people 35 to 54. In addition, 42% of gig workers under 35 say they’re moonlighting to help save for retirement.

    Online lender Earnest gathered data from tens of thousands of loan applicants to learn just how much people are actually earning from their gig. They found 85% of people take home an average of $500 per month from their side hustles.

    CompareCards Releases 2018 Credit Card Fee Report (PR Newswire) Rated: AAA

    CompareCards by LendingTree today released the findings of its studyon credit card fees that compared the fees of a representative sample of 200 credit cards that are in Americans’ wallets.

    Source: Lending Tree

    Highlights from CompareCards 2018 Credit Card Fee Report:

    • Two cards — both no-frills credit cards from credit unions — had only a single fee. One card in the survey had as many as nine fees.
    • Credit union-issued credit cards have 2.73 fees per card, lower than 4.48 fees for cards issued by banks.
    • The most common fee levied by issuers is the late payment fee: 99.5 percent of cards impose this fee, averaging $36.02.
    • The average balance transfer fee, among cards that allow them, is 3.46 percent.
    • The average cash advance fee is 3.99 percent.
    • Foreign transaction fees, overall, average 1.48 percent, including cards that have no fee. But if cards assess the fee, most of the time the fee is 3 percent of the purchase price.
    • When compared with smaller credit card issuers, larger credit card issuers assess higher cash advance fees (4.11 percent, versus 3.86 percent) and balance transfers fees (3.49 percent versus 3.42 percent), on average.
    • However, average foreign transaction fees are lower at larger credit card issuers (1.22 percent, versus 1.76 percent at smaller issuers).

    RBC Wealth Management – U.S. launches new digital alternative investments platform (PR Newswire) Rated: B

    RBC Wealth Management-U.S., one of the nation’s largest full-service wealth management firms, is taking some of the mystery and difficulty out of alternative investing with a new digital alternative investment platform for high-net worth clients.

    Developed in partnership with Artivest, an award-winning alternative investment management and technology solutions provider, RBC Wealth Management’s cloud-based investment platform gives financial advisors and their clients access to leading private equity and hedge funds across sectors, stages and styles.

    Five Firms Hit by ‘Crypto-Sweep’ in Alabama as Regulators Step up Operation (Bitcoin News) Rated: B

    Cease and desist letters have been sent to three Los Angeles based companies. The second firm form California, Leverage, has advertised itself as a crypto lending platform offering to investors a variable, daily interest. This case is again about an unlicensed security, the ASC said.

    5 Ways to Get ‘Free’ Money From Your Employer Without a Raise (Student Loan Hero) Rated: B

    2. Use your company’s 401(k) matching program

    Saving for the long term can be a challenge: 69% of millennials surveyed are not saving for retirement, according to online lender Earnest. Although it can be hard to think about setting aside money when you have to manage student loan payments, it can help with future financial goals — especially if your employer offers a match on retirement plans.

    United Kingdom

    Tandem reaches 100,000 clients, signs for Form3 paytech (Banking Tech), Rated: AAA

    SMEs: a neglected opportunity for UK big banks (SME Magazine) Rated: AAA

    Big banks are neglecting the SME market opportunity due to a variety of factors. One of the main problems is the onboarding process, where in many cases the ownership structure can be unclear, leading to difficulties around initiating relationships with SME businesses.

    Second, the nature of the SME growth model makes it difficult for banks to determine the value of the business opportunity. This poses problems when it comes to granting credit facilities to SMEs, as they are seen as higher risk for conducting business with.

    Third, banks follow bigger sources of revenue and SME profitability is lower than larger organisations.

    Finally, existing legacy software systems prevent large banks from servicing SME customer demands which go beyond traditional offerings. For example, the desire to integrate P2P lending, blockchain, mobile wallets, and accounting and legal functionality all as one end-to-end service.

    Why scaleups still shy away from debt and equity growth funding (Real Business) Rated: A

    Some £2.9 billion was claimed in R&D tax credits during 2015-16, according to HMRC, with the average amount of relief claimed via the SME scheme increasing from £56,223 to £61,514.

    Despite a dip in deal numbers in 2016, the crowdfunding boom returned. Beauhurst data claimed £8.27 billion was invested in 2017 – more than double the previous year.

    Department store numbers fall by quarter (Drapers) Rated: B

    A report by peer-to-peer lending platform Lendy found that the number of large department stores fell from 240 in 2009 to 180 in 2016. The total number of shops fell from 407,000 to 403,000 during the same period.

    Lendy said department stores had been more negatively affected than the rest of the high street by online shopping, as the heavy debt burdens carried by their owners had hampered their own investment in ecommerce and store refurbishment.

    China

    Worst Is Past for Microlenders — Analysts (Caixin Global) Rated: AAA

    Effects of a late-year regulatory crackdown on Chinese online lenders has most likely run its course by now, analysts said, even as shares of U.S.-listed companies continue to feel some lingering fallout.

    Shares of online lenders Qudian Inc. and LexinFintech Holdings Ltd. have tumbled by 24% and 17% respectively since the firms released their first-quarter results a week ago, wiping out over $1.4 billion in combined market value. Yirendai Ltd., the first Chinese peer-to-peer (P2P) lender to list in the U.S., saw its shares fall by 4% a day after releasing its earnings results after trading on Thursday.

    To curb excess in the 1 trillion yuan ($156 billion) unsecured short-term loan industry, regulators issued rules in early December that capped annual interest rates on loans at 36%, barred lenders from offering loans to borrowers with no source of income, and tightened scrutiny over funding sources.

    Australia

    Credible Lab CEO Stephen Dash likens ASX to ‘junior Nasdaq’ (Australian Financial Review) Rated: A

    Credible Labs Inc founder and chief executive Stephen Dash said he had chosen an ASX listing for the company, which allows users to sort through US student loans, because a large number of the company’s early investors were based in Australia and Asia.

    India

    How the Fintech Industry is Drawing Young Talent in the Country (Entrepreneur) Rated: AAA

    The fintech industry is creating new and exciting opportunities for the country’s workforce in such areas as payments, retail baking, peer-to-peer debt financing, personal finance, asset management, institutional investments, remittances, and financial research. However, the primary enabler for all these segments is data. The volume of data that is being generated and leveraged by the digital banking and financial services industry is massive and unprecedented. As a result, the demand for technically trained data scientists is growing rapidly among fintech companies. With an increasing number of people in the country consuming fintech products, data scientists are required to manage large, complex sets of data and organise them to facilitate faster and enhanced delivery of various services to consumers.

    Acko Gets $ 12 mn funding from Amazon, others (Elets Online) Rate: A

    Online insurance startup Acko General Insurance Co. has raised $12 million (around Rs 80 crore) in a new round of funding led by e-commerce giant Amazon, an official statement revealed.

    The latest funding infusion that saw participation from Ashish Dhawan, angel investor and founder of private equity fund ChrysCapital and existing investor Catamaran Ventures, the family office of Infosys co-founder NR Narayana Murthy, takes Acko’s total external funding to nearly $42 million.

    In recent times the online lender that has joined hands with cab aggregator Ola to offer in-ride insurance to riders is said to be exploring venturing into travel insurance and healthcare space.

    Asia

    Singapore Has Fintech Dreams, But It’s Short on Tech Talent (Bloomberg) Rated: A

    Singapore’s goal of becoming a high-tech financial hub is running into real-world problems of labor supply and demand.

    Technology startups in many countries are fighting to attract skilled workers like software engineers. Yet in the tiny city-state of Singapore, with a population of 5.6 million, the dearth of talent is particularly acute. The nation’s universities and polytechnic schools churn out what the government estimates are 400 graduates a year with the right qualifications, well short of plans to add 1,000 financial tech jobs annually, according to the Singapore Fintech Association.

    Africa

    Lidya Scores $ 6.9 Million in Series A Investment (Finovate), Rated: AAA

    Nigeria-based digital bank Lidya landed a fresh round of funding this week. The bank pulled in a Series A round totaling $6.9 million, an amount that marks the round as one of Nigeria’s largest tech investments. Combined with the $1.25 million Lidya received last March, today’s round brings the bank’s total funding to $8.2 million.

    Authors:

    George Popescu
    Allen Taylor

    Monday April 16 2018 Daily News Digest

    yield curve

    News Comments Today’s main news: Goldman buys Clarity Services. Zopa to receive 400M GBP valuation. Lending Works surpasses 100M GBP in online lending. ETHLend expands into fiat lending. Today’s main analysis: PeerIQ’s valuation report. Today’s thought-provoking articles: Why you’re not making much on your bank account. The impact of Brexit. Adjusting to new digital demands. UK venture funding takes a breather. […]

    yield curve

    News Comments

    United States

    United Kingdom

    China

    European Union

    International

    Australia

    India

    Asia

    News Summary

    United States

    Goldman Sachs Comes to the App Store (The Wall Street Journal) Rated: AAA

    Goldman Sachs Group Inc. bought personal-finance app Clarity Money, acquiring a mobile storefront for its growing consumer bank.

    The deal closed on Friday for Clarity Money, whose backers include Soros Capital and Citigroup Inc.’s venture-capital arm. Adam Dell—brother of Michael Dell, the personal-computer pioneer—founded Clarity Money and will join Goldman as a partner, a title rarely given to outsiders.

    Strong Bank Earnings, LendIt Update, PeerIQ’s Valuation Report (PeerIQ), Rated: AAA

    Wells Fargo’s earnings also beat analyst expectations, but the bank cautioned that these results could change due to the ongoing CFPB investigations. Consumer loans decreased $9.5 Bn QoQ – more than LendingClub or SoFi originate in a year – driven by a $3.8 Bn decline in auto loans, $1.9 Bn seasonal decline in credit card balances, and a $1.8 Bn decline in the junior lien mortgage portfolio.

     

    Source: PeerIQ

    PeerIQ’s Valuation Report 

    Source: PeerIQ
    Source: PeerIQ

    Why You’re Still Not Making Much on Your Bank Account (The New York Times), Rated: AAA

    After a decade of being near zero, short-term interest rates have risen sharply in recent months. Typically, these rates — three-month T-billsLiborcommercial paper — move together because they reflect the same basic economic reality.

    Source: The New York Times

    Slow but solid growth in the United States since the Great Recession has finally altered the balance between borrowers and lenders. Higher rates mean those with cash to spare now have the upper hand and can demand a higher price to part with it.

    That’s how it’s supposed to work. But as any saver can tell you, some short-term rates have barely budged.

    Adjusting to new digital demands goes beyond technology (American Banker) Rated: AAA

    One of the dominant themes at the recent Oracle Industry Connect conference was that banking customers are not in a state of transition to digital anymore — they are all digital now.

    But whether an institution is drawing up plans on how to respond to big tech firms entering the banking market, or engaged in an effort to overhaul legacy systems, Suber said, the guiding emotion shouldn’t be fear. Instead, he said, bankers should embrace a “golden age of fintech.”

    Key’s goal is to use digital to enable self-service when appropriate, while gearing the branch towards serving customers with issues best suited for a one-on-one request.

    Regions Bank Announces Partnership With Fintech Mortgage & Consumer Digital Lending Tech Platform Lender Price (Crowdfund Insider) Rated: A

    Regions Bank announced on Thursday it has invested in and formed a partnership with fintech mortgage and consumer digital lending technology platform provider, Lender Price. According to the bank, the duo will focus on streamlining Regions’ digital process and simplify interaction between banks, borrowers, and bank.

    LendingTree considers moving headquarters to Pineville (WBTV Chorlotte) Rated: A

    Online loan marketplace LendingTree is considering moving its headquarters from SouthPark in Charlotte to the Cone Mill site in Pineville.

    The company released a statement Thursday concerning the possible move.

    In the statement the company said that given its considerable growth since the 2016 purchase of two buildings in SouthPark, their headcount projections have expanded significantly, so they are evaluating alternatives, including Pineville.

    Wells Fargo could face $ 1 billion penalty for auto and mortgage abuses (CNN) Rated: A

    The beleaguered bank warned on Friday that it may revise its first quarter earnings results because of the fine. The bank says that the Consumer Financial Protection Bureau and Office of the Comptroller of the Currency have offered to resolve their investigations for that amount.

    Wells Fargo (WFC) apologized last year for charging as many as 570,000 clients for car insurance they didn’t need.

    An internal review by Wells Fargo found that about 20,000 of those customers may have defaulted on their car loans and had their vehicles repossessed in part because of those unnecessary insurance costs.

    DiversyFund Launches New $ 50 Million Growth Fund for Multifamily and Commercial Real Estate Deals (PR Newswire) Rated: A

    DiversyFund, a crowdfunding platform that is revolutionizing real estate investing, has launched its Commercial and Multifamily Real Estate Growth Fund. Investors in this fund will own shares of a variety of real estate investments, with 80% of the fund dedicated to commercial and multifamily properties.

    Projected returns are between 15% and 20% per year. The minimum investment is $5,000.

    Nonprofit Credit Unions Provide Alternatives to Payday Loans (Nonprofit Quarterly) Rated: A

    According to the latest factsheet by the Center For Responsible Lending, over four out of every five payday loans are taken out within the same month of the borrower’s prior loan. In other words, the impetus behind making unaffordable loans is to create demand for additional loans based on deceitful lending practices. As the market for payday lending has grown to $40 billion, the profits from these businesses are directly stripped from low-income consumers with few alternatives. While some legislative efforts have reduced the growth of this market, there are still 12 million US households that use payday loans annually, spending an average of $520 on fees to borrow $375, according to a report from the Pew Charitable Trusts in 2017.

    Senate Banking Committee Probes Mulvaney’s Leadership at the CFPB (National Law Review) Rated: A

    On April 12, 2018, Mick Mulvaney, the Acting Director of the Consumer Financial Protection Bureau (Bureau) testified before the Senate Committee on Banking, Housing, and Urban Affairs regarding the Bureau’s Semi-Annual Report to Congress.  The Senate Hearing comes the day after Democrats in the House Financial Services Committee questioned Mulvaney about his leadership at the Bureau.  A copy of his written testimony is here.

    • Increased Congressional Oversight. Throughout the hearing, Mulvaney stressed his recommendations for greater oversight to hold the Bureau accountable.
    • Payday Lending. Mulvaney noted, however, that he has the discretion to reach a different conclusion about the payday lending rules than his predecessor, Richard Cordray.
    • Data Security.  While data security was an issue that spanned both sides of the aisle, Republican senators focused on the Bureau’s handling of consumer data while their Democratic colleagues focused on Mulvaney’s position on the Equifax data breach.

    As to the Bureau’s handling of data, Mulvaney explained that he has instituted a data freeze and commissioned a report about the Bureau’s data collection and protection.  While the data freeze does not apply to enforcement actions, the Bureau plans “to limit data that we take possession of.  . . . instead of having them send it to us electronically, we are going to look at it.”  Mulvaney acknowledged that “everything that we keep is subject to being lost.”  When Sen. David Perdue (R-GA) asked what data had been lost, Mulvaney declined to publicly comment.

     

    Some companies are turning their noses up at Softbank’s huge cash offers (CNBC) Rated: A

    SoftBank’s massive Vision Fund said in 2017 that its minimum check size is $100 million. But in the financial-technology market, the number appears to be twice as big.

    Executives at a half-dozen fintech companies said the Vision Fund has told them it’s looking to do deals where it can put at least $200 million to work over one or multiple investment rounds. These people asked not to be named because their talks with SoftBank are confidential.

    Young Consumers Want Financial Advice (Credit Union Times) Rated: A

    Analysts from LIMRA and Life Happens have reported that finding in summaries of results from a joint online survey of 2,082 US. adults

    Only 7% of the boomers said they were looking for financial advisors; 41% said they already had advisors and were happy with their advisors.

    But 18% of the millennials polled, and 19% of the members of Generation X, said they would like to have advisors and were searching.

    Fintechs aiming AI at advisers (Investment News) Rated: B

    Dream Forward deploys AI chatbots in its automated 401(k) platform, and is now beta testing a mobile-only version that can answer client questions via text message without requiring customers to log into their accounts.

    Laserfiche develops automated workflows for advisers and later this year plans to go one step further with “robotic processes” that will automate even more of advisers’ manual, repetitive front- and back-office tasks.

    United Kingdom

    Zopa to receive GBP 400mn valuation in new fundraising plans: Sky News (Zephyre) Rated: AAA

    UK-based peer-to-peer lender Zopa is in advanced negotiations with potential investors to seek around GBP 50.00 million in funding, helping advance the company to one of the largest financial technology (fintech) businesses in the country, Sky News reported.

    Citing sources close to the matter, the broadcaster observed the simple loans and smart investment firm could be valued at GBP 400.00 million as a result of the deal, expected to be led by existing shareholders Wadhawan Global Capital.

    In the loop: the continuous woes of traditional retailers (Elite Business) Rated: A

    Lender Zopa reportedly targets £400m valuation with new fundraising round

    Zopa, the peer-to-peer lender, is planning to raise a £125m round, according to Sky News. This will push the company’s valuation to a soaring £400m and is rumoured to serve as a pre-IPO funding round.

    UK VC investment dropped in Q1

    Worryingly, it seems as if Brexit has left investors clutching their chequebooks tighter in the first quarter of 2018, according to KPMG Enterprise.

    Former P2PFA chair joins Zopa (Bridging & Commercial) Rated: B

    Zopa has appointed the former Peer to Peer Finance Association (P2PFA) chair Christine Farnish (pictured above) as chair of its P2P board.

    Lending Works Surpasses £100 Million in Online Lending (Crowdfund Insider) Rated: AAA

    UK-based peer-to-peer lender Lending Works announced this week it surpassed £100 million in online lending. According to Lending Works, the milestone comes just a little over a year after the platform surpassed £50 million. The lender also reported that 20,000 customers (over 16,000 borrowers and nearly 4,000 lenders) have used its platform.

    2018 Venture Capital investment in UK takes a breather after a bumper 2017 (Business East Midlands) Rated: AAA

    Following a blockbuster year of over 8 billion USD invested within the UK bolstered significantly by multiple mega-rounds, – 2018 still managed to achieve a healthy start, with one $100 million round pushing the nation’s tally over 1 billion USD. The UK played host to seven of the top 10 European deals in the last quarter of 2017, but managed to scrape just one of the 10 in the first quarter of 2018. Four of the ten biggest European deals done in the first three months of 2018 were located in Germany.

    What happens when fintech valuations come back down to Earth? (Financial Times) Rated: A

    No tech subsector has reached stratospheric valuations as consistently as financial technology, or fintech. The heady combination of huge markets, a radical platform shift to mobile, and newly vulnerable incumbent dinosaurs (be they banks, wealth managers, or insurers) has attracted over $30bn of annual investment. After a decade of evolution, 2018 looks set to be the first year we’ll see a herd of fintech firms go public. At least ten have filed or talked about an impending listing this year, including TransferWise, Credit Karma, Adyen and Funding Circle.

     

     

    ‘YOU KICK IT’ AND THE ALTERNATIVE INVESTMENT INDUSTRY (All About Alpha) Rated: AAA

    The Alternative Investment Management Association, the London-based organization representing the interests of the world’s alternative investment industry, has issued a new whitepaper about the impact of the exit of the United Kingdom from the European Union.

    The United Kingdom has the largest alternative assets industry in Europe, so AIMA is unsurprisingly interested in the consequences of such an exit.

    Read the full report here.

    Fintech recruits ahead of open banking ‘tsunami’ (Insider) Rated: A

    Scottish fintech business The ID Co is on a recruitment drive ahead of an expected ‘tsunami’ with the advent of so-called open banking.

    The Edinburgh-based company helps banks make lending decisions by analysing live financial data including online bank statements, cashflow and credit agency records – and was one of the first agitators for open banking.

     

     

     

    Time to think outside the bank? (Love Money) Rated: A

    Savers subscribed to 8.5 million Cash ISAs in the tax year ending 5 April 2017, down from 10.1 million the previous year, while the total amount saved tumbled by a third to £39.2 billion.

    LendingCrowd’s original IFISA product, the Growth ISA, is designed for those who want a quick and simple way of creating a diversified portfolio of secured business loans.

    By automatically reinvesting their interest and capital repayments, the Growth ISA has actually delivered an average return for investors of 8.5% – more than three times the rate of inflation – as shown in the chart below.

    Source: Love Money

     

    China

     

     

    Technology and eCommerce Are Now Driving China’s Small Businesses’ to Success (eSeller Cafe) Rated: B

    According to the recent survey, Mainland China’s small businesses are the top users of fintech application and in digital payment technologies. More than 84 percent of the survey’s respondents say that at least 10 percent of their overall revenue came via these platforms. Businesses also use fintech to access funds from crowd-sourced funding and peer-to-peer lending.

     

    European Union

    EU Banks Losing Profits, Lending Ability Because Of Reforms, Report Says (PYMNTS) Rated: A

    The Association for Financial Markets (AFME) in Europe wants regulators to curb the development of aggressive bank regulation, according to Reuters reports on Thursday (April 12).

    The bank lobby has released a study aimed at reducing regulators’ heavy hand in the financial services market that the group said has made it more difficult for banks in Europe to support the broader economy in the wake of the financial crisis.

    The AFME released a report along with PwC which surveyed 13 international banks, accounting for a combined 70 percent of capital market activity around the world, reports said. Analysis found the annual cost of regulation costs $37 billion for 13 banks combined, amounting to 39 percent of total capital markets expenses in 2016.

    International

    ETHLend Expands to FIAT Lending, Initiating Licensing Process (Finance Magnates) Rated: AAA

    ETHLend, a crypto-to-crypto lending platform, has started a process to obtain a license on lending activities in over thirty countries in the European Economic Area (EEA). ETHlend’s initiative will also include other countries as well with its helping expand its current business model (crypto-to-crypto lending) to provide financing in FIAT currencies such as EUR, USD, and GBP against cryptocurrency holdings.

     

    Everything You Need To Know About What’s Coming ‘Round The Corner (PYMNTS) Rated: A

    In payments and commerce, it’s an eternity. Too long, according to ZestFinance, a company that believes credit needs a machine learning upgrade. Trulioo thinks verification needs to step up so financial institutions can actually “know their customer.” Global cross-border payments between businesses need a major boost to support the trillion dollars worth of transactions they’ve have to support in five years.

    Source: PYMNTS

    12 Selected Finalists at the 2017 Seedstars World Prize (Tech in Africa) Rated: B

    RedCapital from Chile is a crowdfunding P2P lending startup. It offers a platform through which investors get attractive returns at low risk. Furthermore, the SMEs acquire loans at favorable rates. The startup has a risk predictor that allows its investors to realize zero default.

    Australia

     

    Latitude Financial pledges to grow lending responsibly and profitably (Australia Financial Review) Rated: AAA

    Unsecured personal lender and ASX-aspirant Latitude Financial is targeting up to $5 billion of new loans over the next few years as its chief executive Sean Morrissey insists it can grow responsibly amid heightened scrutiny on lending standards.

    During a “non-deal roadshow” over the past month, Latitude has met with around 100 fund managers ahead of what is expected to be the biggest ASX initial public offering since Medibank Private in 2014. Latitude’s three shareholders, KKR & Co, Varde Partners and Deutsche Bank, have not yet made a decision on timing for the float, which could value the equity in the group at around $5 billion.

    N2N Connect expanding into P2P lending (The Edge Markets) Rated: A

    Maintain outperform with an unchanged target price (TP) of RM1.53: N2N announced plans to acquire a 28% interest in Australian-based OurMoneyMarket Holdings Pty Ltd (OMM) through a subscription of new shares for a cash consideration of A$2.8 million (RM8.43 million).

    India

    Aye Finance receives 30 cr debt funding from Swiss investor (Business Line) Rated: AAA

    Online lender from micro businesses Aye Finance said that it has received Rs 30 crore debt funding from from Swiss-based impact investor, BlueOrchard Finance Ltd. The funds would help the MSME lender to further diversify its lending portfolio, reaching out to the long trail of MSMEs in India.

    Fintech company Cash Suvidhakeen to enter microfinance biz (Business Line) Rated: A

    Cash Suvidha, a start-up fintech company that extends business loans to small and medium enterprises (SMEs) and start-ups, is looking to foray into microfinance business.

    According to Rajesh Gupta, founder, Cash Suvidha, the company is exploring the possibility of either acquiring an existing microfinance institution (MFI) or setting up a separate vertical for its MFI business in the next two-to-three years.

    “Rural lending is one area which excites me the most,” Gupta told BusinessLine.

    Asia

    After rounding off 2017 at a remarkable high bolstered by megadeals, Asia continued to see large deals in Q1 2018. These include two US$1 billion+ megadeals which were struck outside China, with Singapore-based Grab’s Series G financing and Go-Jek in Indonesia’s Series E round.

    “Singapore saw a record US$2.68 billion of VC investment in Q1 2018, despite a relatively muted level of activity. It is testament to the maturing of Singapore’s ecosystem that a business such as Grab could be built here to tackle the regional market. In addition, the top deals in Singapore also span across diverse sectors, from logistics, internet retail to biotechnology,” said Chia Tek Yew, head of Financial Services Advisory, KPMG in Singapore.

    UOB, China fintech Pintec team up to offer credit services in South-east Asia (Straits Times) Rated: A

    United Overseas Bank (UOB) has entered into an agreement with Beijing-based financial technology firm Pintec Technology Holdings to set up a joint venture company, Avatec.ai.

    UOB will have a 60 per cent stake in the joint venture, the bank said in a regulatory filing on Monday (April 16).

    Avatec will have an issued and paid-up capital of up to S$10 million and will be a subsidiary of UOB.

    Alternative finance the option for millennials (Financial Standard) Rated: A

    Speaking at the AltFi Australasia Summit in Sydney today, OnDeck chief executive Noah Breslow said he can see the Australian alternative finance industry working with $2 billion in new loan volumes by 2020. He expects the industry to oversee about $700 million in new loans this year.

    “Compared to five years ago, 70% of small business owners perceive there are more small business lending options today than there were in 2013. It shows how mainstream this type of financing is becoming,” Breslow said.

    Equifax group managing director Asia Pacific, Mike Cutter, said 54% of online lending enquiries come from Australians 35-years-old and under. And Queensland is leading the charge, he said.

    Singapore Weary Of Forcing Open Banking On FinServ Market (Pymnts) Rated: A

    Singapore is ready for open banking, but regulators don’t want to force it on the financial services market, according to reports in Bloomberg.

    Bloomberg highlighted how Singapore’s approach differs from open banking initiatives in Europe and Japan, where regulators have imposed requirements for banks and other financial institutions to support the movement of data between their systems and those of third-party financial service providers. Such was the aim of PSD2 in Europe and Open Banking in the U.K.

    Singapore fintech startup Silot raises almost US$ 3m in pre-Series A funding (Business Times) Rated: A

    SINGAPORE-headquartered fintech company Silot has raised some US$2.87 million from investors Arbor Ventures and Eight Roads Ventures with the completion of its pre-series A funding.

    Arbor Ventures is a global early-stage venture capital firm, while Eight Roads Ventures is the proprietary investment arm of Fidelity International.

    OJK to relax muscles in next fintech regulation (The Jakarta Post) Rated: B

    The Financial Services Authority (OJK) has adopted a more relaxed view toward the financial technology (fintech) industry, believing that rigid policies may only make them obsolete in the face of fast-growing businesses in the digital sector.The financial regulator already has a policy, called OJK Regulation (POJK) No. 77/2016, which governs peer-to-peer (P2P) lending fintech companies.

    Flat loan growth positive for banks (The Edge Markets) Rated: A

    After missing loan growth targets in 2017, several Malaysian banks have kept expectations more conservative this year, even as Bank Negara Malaysia (BNM) data indicated a moderation in the total outstanding financing growth of 4.1% in 2017 compared with 5.6% in 2016.

     

     

    Almost 50 peer-to-peer lending businesses licensed with OJK (The Jakarta Post) Rated: A

    OJK deputy commissioner Sukarela Batunanggar said as of April, there were 44 P2P lending businesses that had been granted operational permits by the authority. This figure, he said, was a considerable increase from just 30 P2P lending businesses in January, indicating robust growth in the industry.

    Authors:

    George Popescu
    Allen Taylor