Thursday December 13 2018, Daily News Digest

unsecured personal loan balances

News Comments Today’s main news: FDIC opens comments on Special Purpose National Bank charters. Plaid raises $250M. P2PFA member lending exceeds 10B GBP. ThinCats raise 200M GBP. Bondora originates almost 8M euro in loans in November. Klarna joins Shopify Plus Partner Program. Nubank launches debit card. Today’s main analysis: Trends in credit card debt. Today’s thought-provoking articles: Consumer credit market poised […]

unsecured personal loan balances

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United States

United Kingdom

European Union

International

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News Summary

United States

FDIC Embraces FinTech (PeerIQ), Rated: AAA

Formation of new banks post-crisis is historically low. More banks have failed since 2009 than have new banks opened.This trend could leave some communities severely underbanked.

The FDIC wants to encourage new banks to startup and wants innovative FinTech firms to be part of that process. The agency wants to streamline its application process and is seeking comments on how that can be done.

The OCC’s Special Purpose National Bank (SPNB) charter allows FinTechs to operate as banks.

Fintech startup Plaid raises $ 250M at a $ 2.65B valuation (TechCrunch), Rated: AAA

The company is today announcing a $250 million Series C investment led by famed venture capitalist and the author of the Internet Trends reportMary Meeker, who will join its board of directors as part of the deal. The funds were raised at a valuation of $2.65 billion, according to sources close to the company. Capital from Meeker’s investment came from Kleiner Perkins’ growth fund — where Meeker has been a partner since 2010 — not from the reported billion-dollar-plus solo fund she’s in the process of raising.

New investors Andreessen Horowitz, Index Ventures, Norwest Venture Partners and Coatue Management also participated, as did existing investors Goldman Sachs, NEA and Spark Capital.

U.S. Consumer Credit Market Poised for More Growth in 2019 (TransUnion), Rated: AAA

Low unemployment rates and continued positive growth in both GDP and real disposable income are among the key drivers that will propel the U.S. consumer credit market in 2019. Partly due to the strong performance of these economic indicators, TransUnion’s (NYSE: TRU) 2019 consumer credit forecast found that originations and consumer balances are expected to increase for most credit products, while serious delinquency rates will likely decline or remain steady.

Source: Globe News Wire

A few outliers in the forecast come by way of serious credit card delinquency rates and originations as well as mortgage originations. Credit card delinquency rates are expected to rise from 1.94% in Q4 2018 to 2.04% in Q4 2019 as a shift toward more non-prime consumers with access to credit cards will likely negatively impact originations and consequently the serious delinquency rate.

Source: Globe News Wire

TransUnion Forecast: Top Consumer Credit Trends for ‘19

Trend #1: There’s Room for Growth in Personal Loans

Personal loans continue to display signs of strength, and total balances are expected to climb 20% to an all-time high of 156.3 billion by the end of 2019.

Trend #2: Affordability May Impact the Auto Industry

It’s also worth noting that the number of auto loan originations is expected to end 2018 at 28.5 million and grow to 29.4 million in 2019. This is a significant increase from recent years (27.5 million in 2017, 28.3 million in 2016, 28.0 million in 2015). This growth is expected to be driven from both ends of the risk spectrum. Yet as the growth continues, the serious delinquency rate is anticipated to remain muted, ticking up to 1.44% in Q4 2019, an increase from the expected 1.43% in Q4 2018 and the 1.43% mark observed in Q4 2017.

Trend #3: Homes Becoming More Expensive, but Home Equity Increases Could Be a Boon to Consumers

Mortgage originations have declined the past several quarters, a trend that is expected to continue into 2019.  Rising interest rates, increasing home prices, and supply constraints are driving lower origination numbers.  Average balances will continue to trend upward in 2019, growing from an anticipated $208,831 at the end of Q4 of this year to $218,490 by the end of Q4 2019, a 4.6% increase.

Trend #4: More Near Prime Consumers will Carry a Credit Card

Near prime consumers are expected to increase their origination share to 19.1% in 2019, up from 18.3% in 2018.

Credit Card Debt Study: Trends & Insights (Wallet Hub), Rated: AAA

Americans repaid $40.8 billion in credit card debt during Q1 2018 – the second-largest quarterly payoff ever. But we added almost $38 billion back to our tab in Q3 and Q2 2018. We also began the year owing more than $1 trillion in credit card debt for the first time ever, after adding $87.3 billion to our tab in 2017.

Source: WalletHub

The $38 billion in credit card debt added during Q2 and Q3 2018 has nearly wiped out consumers’ large first quarter pay-down.

We ended 2017 with $87.3 billion in new credit card debt, and WalletHub projects a $70 billion increase in 2018 by the end of the year.

Source: WalletHub

Americans started 2018 with more than $1 trillion in outstanding credit card balances for the first time ever, and we are on pace to begin 2019 in even worse shape.

Cities with the Highest & Lowest Credit Card Debts

Percentile* City Median Credit Card Debt Cost to Pay off Months & Days Until Payoff
99 Colleyville, TX $5,593 $880 24 months and 28 days
99 Darien, CT $7,935 $1,167 23 months and 8 days
99 Park City, UT $5,376 $720 21 months and 5 days
99 Fairbanks, AK $4,655 $620 21 months and 2 days
99 Summit, NJ $4,953 $655 20 months and 29 days
99 Leawood, KS $4,857 $642 20 months and 29 days
99 The Woodlands, TX $5,088 $670 20 months and 27 days
99 Mill Valley, CA $5,110 $672 20 months and 26 days
99 Needham, MA $4,393 $577 20 months and 25 days
99 Sammamish, WA $4,386 $575 20 months and 24 days
99 Durango, CO $3,583 $466 20 months and 17 days
99 Lafayette, CO $3,600 $467 20 months and 16 days
99 Juneau, AK $4,166 $540 20 months and 16 days
99 Southlake, TX $5,988 $775 20 months and 14 days
99 Ridgewood, NJ $5,625 $727 20 months and 14 days
99 Hoboken, NJ $3,570 $456 20 months and 6 days
99 Westport, CT $6,112 $770 19 months and 30 days
99 Winchester, MA $4,618 $580 19 months and 28 days
99 Highland Park, IL $5,379 $672 19 months and 24 days
99 Bethesda, MD $4,599 $573 19 months and 22 days
99 Wasilla, AK $4,693 $584 19 months and 22 days
99 Monument, CO $4,157 $514 19 months and 17 days
99 Newton, MA $4,014 $494 19 months and 15 days
99 Lafayette, CA $5,028 $618 19 months and 13 days
99 Scarsdale, NY $5,231 $641 19 months and 11 days
99 Bloomfield Hills, MI $4,552 $557 19 months and 11 days
99 Deerfield, IL $4,698 $575 19 months and 10 days
99 Woodinville, WA $4,331 $528 19 months and 8 days
99 Brookhaven, GA $4,221 $513 19 months and 6 days
99 Hingham, MA $4,571 $554 19 months and 4 days
*99th Percentile = Least Sustainable Credit Card Debt

A Different Kind of Gender Gap: Homeownership Is More Common Among Single Women Than Single Men (LendingTree), Rated: AAA

  • Single women own considerably more homes than single men do. On average, single women own around 22% of homes, while single men own less than 13% of homes.
  • Oklahoma City was the metropolitan area where single men own the largest share of owner-occupied homes, at 16%. Even though single men own a greater proportion of homes in Oklahoma City than they do elsewhere in the country, they still own fewer homes than single women, who own 24% of residential properties in the area.
  • New Orleans was the metropolitan area where single women own the largest share of owner-occupied homes. In this area, single women own nearly twice as many homes than single men do: 27% compared with 15%.

OCC sees sharp drop in mortgages serviced by large banks (American Banker), Rated: A

The OCC’s quarterly metrics report, released Tuesday, showed continued improvements in credit quality of mortgage loans at banks. But it also noted that the report is based on $3.26 trillion in principal balances, representing 32% of all mortgages in the U.S. Ten years ago, that figure was $6.1 trillion in mortgage balances, representing 60% of all outstanding mortgages.

How Do Underwriters View Mortgage Lending? (Progress in Lending), Rated: A

Subprime personal loans will flourish in 2019 thanks to startups and Donald Trump (Quartz), Rated: AAA

Subprime personal loan balances have been climbing since 2014 and are forecast to increase 20% next year, to a record $156.3 billion, according to credit-scoring firm TransUnion. The last three months of this year will be the biggest quarter ever for origination, accounting for some 5 million loans.

San Francisco-based Affirm, founded by PayPal co-founder Max Levchin, is one of the leaders in point-of-sale loans and is available at more than 1,200 US retailers. The company says its lending process allows it to approve far more applicants across the credit spectrum than traditional lenders.

Payday lending has also increased. These days, this type of high-interest, short-term debt often takes place online through installment loans. San Francisco-based LendUp is an example of the new breed of payday lenders, charging annual percentage rates that can range from 30% to more than 1,300% depending on the type of loan, according to a report by NerdWallet.

Galaxy Digital Leads $ 30 Million Funding for Social-Crypto Startup Good Money (CoinDesk), Rated: A

Digital banking platform Good Money just raised $30 million in a Series A funding round to continue developing its app.

Led by Michael Novogratz’s Galaxy Digital (via its Galaxy EOS VC Fund), participants in the funding round included Breyer Capital, Blocktower Capital, Boost VC, Ken Howery, BlockChange Ventures, Cross Culture Capital, Troy Carter, Mitch Kapor, Peter Diamandis Blake Mycoskie and Justin Rosenstein, among others.

Half of Americans think using sharing services is risky (Biz Journals), Rated: A

Personal safety is a real concern Americans have about the sharing economy, according to a new survey commissioned by insurance company Lloyd’s.

The sharing economy includes companies that use data and develop platforms to connect people, including ride-sharing services like Uber and Lyft, apartment and home lending sites like Airbnb and VRBO, as well as peer-to-peer lending, reselling, co-working, and freelancing sites, per Forbes.

The analysis showed that 60 percent of American consumers believe they are putting their personal safety at risk by using sharing services because it means interacting with strangers, and 58 percent think that the risks outweigh the benefits.

Investors’ Harbour Launches New Fund That Will Finance the Development of Hawaii’s Newest Master-Planned Community (Investors’ Harbour), Rated: B

Admiral Realty Capital’s new private placement, Fund V, is engaged in providing financing to Puainako Heights Land Investment, the master-developer of a subdivision on the Big Island with over 330 single-family homesites. The offering is featured on the Boston-based crowdfunding platform Investors’ Harbour.

Different than most existing crowdfunding platforms, Investors’ Harbour does not feature an avalanche of small “fix-and-flip” projects handled by real estate enthusiasts. With a very low acceptance rate, Harbour only hosts larger-scale construction programs, conducted by commercial development firms with admirable track record.

Dharma-based Crypto Lending Platform Bloqboard Launches New Feature to Empower Lenders (Crypto Coin Spy), Rated: B

Bloqboard – a non-custodial digital asset lending platform for collateralized loans originated, settled, serviced, and managed on the Ethereum network and powered by Dharma and Compound – has today announced the release of a new feature they call ‘Offers to Lend’. This provides lenders with the ability to offer prospective borrowers their cryptoassets for peer-to-peer loans issued on the Dharma protocol.

Wyre partners with bZx, the protocol that powers decentralized margin lending (Cryptoninjas), Rated: B

Blockchain enabled payments company Wyre today announced a partnership with bZx, the protocol that powers decentralized margin lending. bZx will incorporate Wyre’s KYC/AML solution for DEXs to offer compliant trading.

United Kingdom

P2PFA member lending exceeds £10bn (P2P Finance News), Rated: AAA

PEER-TO-PEER Finance Association (P2PFA) platforms have cumulatively lent out more than £10bn, according to the trade body’s latest data.

Peer-to-peer platform ThinCats secures £200m funding deal (AltFi), Rated: AAA

The money comes from BAE Systems Pensions and is the second significant loan funding deal struck by ThinCats in the last few months.

Iwoca adds Barclays and HSBC to Open Banking connections (Finextra), Rated: A

iwoca, the UK’s fastest growing small business lender, today announces it has connected to Barclays and HSBC banks under Open Banking.

Tide accounts for 1 per cent of UK’s SME banking market (AltFi), Rated: A

Digital business bank Tide has reached 56,000 SME customers, accounting for one per cent the UK’s 5.6m SMEs. The bank has more than doubled the number of customers using its services in the last 12 months.

UK recruiters say challenger banks and fintech businesses are now more appealing to candidates than traditional banks (Onrec), Rated: A

  • 55% of recruiters and HR managers have seen an increase in hiring rates over the last five years
  • Half of UK recruiters and HR managers have seen an increase in demand for AI, cryptocurrency and blockchain skills
  • 55% say the number of roles requiring these emerging tech skills has outstripped the number of available candidates
  • 32% of recruiters say traditional banks are the least appealing FS organisations to candidates, whilst cryptocurrency businesses are top

Sancus tightens credit processes amid no-deal Brexit fears (P2P Finance News), Rated: A

SANCUS BMS has prepared itself for a no-deal Brexit and tightened its credit processes to protect itself from a market slowdown, its chief executive has said.

Sancus BMS, which comprises the peer-to-peer lenders Sancus Finance and Sancus Funding, sent out an email to its community on Wednesday.

Starling Bank Adds Onedox to Its Marketplace (coverageR), Rated: B

Founded in 2015 with £1m in funding, Onedox helps people manage household bills and expenses by allowing them to connect their different accounts including gas, electric, internet, mobile, and insurance. The service – which is free of charge – allows users to stay on top of their bills while receiving personalized recommendations for saving money by switching to new providers.

China

China Lending Expands B2B Offerings With Supply Chain Service (PYMNTS), Rated: AAA

China Lending Corporation has announced the launch of its new supply chain financing services, which include a business factoring program.

In addition, China Lending has acquired 98.04 percent equity interest in Hangzhou Zeshi Investment Partners, which will enable China Lending to launch its new supply chain financing services in the near future, including financing products design, related corporate financing solutions, investments and asset management, and more.

Best/Worst Bets In Chinese Fintech (Seeking Alpha), Rated: A

China’s financial technology, or fintech, sector, has suffered this year due to a slowing economy and stricter financial regulation. In the peer to peer lending sector, hundreds of firms have shut down due to inability to comply with regulations or insolvency. So, what can we expect from this industry in the near future?

European Union

P2P Lender Bondora Reports Almost €8 Million in Originations for November (Crowdfund Insider), Rated: AAA

Peer to peer lending platform Bondora says loan originations almost hit €8 million during the month of November. This follows a record-breaking month of October

In November, Bondora issued €7,894,070 of new loans, just ahead of the record set for originations in the previous month of €7,802,163.

LendIt Fintech Europe 2018 Slide Presentations Now Live (LendIt.com), Rated: A

Thanks to everyone who joined us at LendIt Fintech Europe 2018. Below you will find all of the presentations from the event. You can also view the photos from LendIt Fintech Europe 2018.

Keynotes

  • Joel Perlman, OakNorth Holdings – The OakNorth Growth Story – from Startup to Profitable Unicorn
  • June Ou, Figure – Blockchain: Creating the Future of Financial Services
  • John Goodall, Landbay – Misconceptions of the UK Buy-to-Let Market Today

Get the full schedule here.

Spotcap increases credit lines to EUR 300M (Spotcap email), Rated: A

It’s been a busy and rewarding 12 months for us here at 

YouHodler – Top Crypto Lending Platform on the Market (NewsBTC), Rated: A

YouHodler is a crypto-backed loan service provider. This established blockchain platform allows users to acquire loans instantly, by leveraging their cryptocurrencies for EUR or USD.

The company offers the highest loan-to-value ratio in the entire industry – up to 80%. And, unlike its competitors, it accepts five of the top cryptocurrencies as collateral, including Bitcoin, Ethereum, Litecoin, Bitcoin Cash, and Ripple. Short-term loans are available at a low interest rate of just 2.5%.

Alternative finance ‘becoming vital’ for SMEs in north (The Irish News), Rated: A

THE ability for small businesses in Northern Ireland to access alternative forms of finance has become a vital factor in their successful growth, the head of a Belfast accountancy firm insists.

Since the financial crash and credit crunch, the funding void left by traditional lenders has been filled by boutique funders and alternative finance, which can allow SMEs to access finance for a variety of different needs, from long term investment through to funding for short term working capital.

International

Klarna Joins Shopify Plus Partner Program To Power High-Growth Merchants (PR Newswire), Rated: AAA

Klarna announced today that they are among the first payment service providers to join the Shopify Plus Technology Partner Program, focusing on high-growth and high-volume merchants. This integration will allow merchants in Germany, the UK and the US to easily implement Klarna’s smoooth payment suite and offer a superior customer experience and thereby unlock additional growth potential.

Cred Opens Crypto Corporate Lending Platform To Developers (PYMNTS), Rated: A

In a press release on Tuesday (Dec. 11), Cred revealed the rollout of its developer platform CredX (not to be confused with the new credit card accounts payable solution recently launched by Finexio). The Crypto-Lending-as-a-Service (CLaaS) solution enables other crypto companies — including exchanges, crypto wallets or mining services — to integrate Cred’s lending functionality into their own solutions. Its set of application program interfaces (APIs) enable businesses to use crypto as collateral to access corporate financing products.

Australia

Payday loan applicants asked to hand over bank passwords, inquiry hears (The Guardian), Rated: AAA

A new parliamentary inquiry has begun scrutinising the behaviour of payday lenders, buy-now-pay-later firms, and credit repair agencies.

Vulnerable Australians are agreeing to share their internet banking passwords so payday lenders can see their transaction history before lending them money, an inquiry has heard.

Asia

400 Online Lending Sites, Fintech Platforms Being Shut Down (Tempo.co), Rated: AAA

Communication and Informatics (Kominfo) Minister Rudiantara said the ministry had shut down 400 financial technologies (fintech), consisted of sites and applications, related to fraud cases on online loan services that are recently rampant in Indonesia.

LBH Urged to Expose Identities of Violating Online Loan Services (Tempo.co), Rated: B

The Indonesian Fintech Joint Funding Association (AFPI) asked the Jakarta Legal Aid Institute (LBH) to open the identities of 25 peer to peer (P2P) lending organizers or registered online loan services that are said to have made violation.

South Korea is getting its first fintech unicorn (Business Insider), Rated: A

South Korean fintech Toss has raised an $80 million funding round led by US-based firms Kleiner Perkins and Ribbit Capital, with participation from Altos Ventures, Bessemer Venture Partners, PayPal, and Qualcomm Ventures, among others. This brings Toss’ valuation to $1.2 billion, making it the latest fintech unicorn globally, and Korea’s first.

Toss started out offering peer-to-peer (P2P) payments, but has since added other services —including insurance, investments, savings accounts, credit score management, and a financial dashboard that allows users to see all of their finances in one place — by partnering with third parties. Toss already has 10 million registered users, meaning it reaches around 20% of Korea’s population with its services.

Source: Business Insider

How these Amazon and Xiaomi alums are helping the unbanked with blockchain (Tech in Asia), Rated: A

“A lot of the traditional models are not applicable to onboard those people into financial systems,” says Sarah Zhang, co-founder of Singapore-based Points.

That’s where Points – also called PTS – picks up the slack. Founded last year, the blockchain-powered startup uses AI and big data to assess factors like an individual’s occupation, bill payments, and shopping activities to calculate a credit score.

Latin America

Brazilian Fintech Nubank Launches Debit Card To Reach 120M Clients (Forbes), Rated: AAA

Brazilian fintech Nubank has launched a debit function for its card offering as well as the ability to withdraw cash from ATMs, in a move that aims to extend its reach to as many as 120 million customers.

The startup created in 2013 and valued at over $4 billion 

Africa

Experian to acquire African credit info firm Compuscan for $ 263m (Fintech Futures), Rated: AAA

Experian is buying African credit information and analytics services firm Compuscan for ZAR 3.72 billion ($263 million) from markets investor Actis.

Authors:

George Popescu
Allen Taylor

Thursday November 29 2018, Daily News Digest

GlobalData

News Comments Today’s main news: MPOWER Financing raises $110M. Funding Circle, BBB partner on SME lending. Zopa sells batch of defaulted loans. Yirendai misses earnings estimates by .17 EPS. RateSetter aiming to be Australia’s biggest consumer loans provider. Revolut greenlighted to expand into Singapore, Japan. Today’s main analysis: Is UK headed for credit card crisis? Today’s thought-provoking articles: 37.4% of purchase […]

GlobalData

News Comments

United States

United Kingdom

Southeast Asia

Other

News Summary

United States

MPOWER Financing raises USD110 million in latest funding round (Private Equity Wire) Rated: AAA

MPOWER Financing, a fintech company providing educational loans to high-potential international and DACA students, has completed its largest funding round to-date with USD110 million in new financing for students enrolling in major US universities.

This latest round, led by Gray Matters Capital and Community Investment Management (CIM), will be used to support new product growth and technology enhancements as well as to finance MPOWER Financing’s expanding student loan portfolio.

“We co-created a unique type of debt with Community Investment Management’s leadership team. This USD100 million is just the beginning of MPOWER’s Capital Markets roadmap,” says Mike Davis, MPOWER Financing Chief Investment Officer and co-founder.

37.4% of Purchase Borrowers Received  Mortgage Rates Under 5% Last Week (LendingTree), Rated: AAA

  • For 30-year fixed-rate mortgages, 37.4% of purchase borrowers received offers under 5%, up from 29.4% the prior week. A year ago, 98.1% of purchase offers were under 5%.
  • Across all 30-year fixed-rate mortgage purchase applications on LendingTree, the most common interest rate was 4.875%, offered to 21.3% of borrowers.
  • 27.9% of 30-year fixed-rate mortgage refinance borrowers received offers under 5%, up from 20.1% the prior week. A year ago, 98.1% of refinance offers were under 5%.
  • Across all 30-year fixed-rate mortgage refinance applications, the most common interest rate was 5.00%, offered to 22.3% of borrowers.


5 Technologies And Trends Changing The Credit Industry (ValueWalk), Rated: AAA

New tools and advancements in the credit industry are transforming the way consumers borrow cash. Before, loan options were limited to government entities (Pag-IBIG and SSS), banks, credit cards, cash advance from credit cards, and loan sharks. These financial institutions (apart from loan sharks) are heavily regulated, but with a roster of new methods offered today, loaning has become more accessible and borrower-friendly.

The Future of Fintech Video Series: Intuit Consumer Group (ATM Marketplace), Rated: A

Intuit Consumer Group’s Varun Krishna gives some background on the company’s latest partnerships with Lending club and Wealthfront. This interview is part of a video series, “The Future of Fintech,” produced by Mobile Payments Today and powered by Galileo Processing.

MPL Loan Performance Monitor (as of August 2018) (PeerIQ), Rated: A

Highlights from the August 2018 MPL Loan Performance Monitor :

  • Our MPL Loan Performance Monitor tracks the delinquency rates, cumulative losses, cumulative prepays and transition matrices using public marketplace lending data that comprises unsecured consumer loans originated by Marketplace Lenders.
  • Delinquencies on the 2017 vintage in the first 18 months are lower than those on the 2015 and 2016 vintages with lenders having tightened underwriting standards.
  • Cumulative loss rates on the 2017 vintage are lower than those on the 2015 and 2016 vintages. Cumulative losses on the 2015-2017 vintages are outpacing those on earlier vintages.
  • Cumulative prepayments have picked up, with the 2017 vintage paying significantly faster than all prior vintages.

Lendio Recognized as a Great Place to Work for Third Consecutive Year (Lendio), Rated: A

Lendio was certified for the third consecutive year as a great workplace by the independent analysts at Great Place to Work. Lendio earned this credential based on extensive ratings provided by its employees in anonymous surveys. A summary of these ratings can be found at 

Four Major Fintech Trends In The Self-Directed IRA Industry (Forbes), Rated: A

Fintech has helped significantly increase the number of investment options available to self-directed IRA investments. From online crowdfunding platforms to peer-to-peer lending portals, as well as cryptocurrency and digital asset exchanges, new financial technology has helped self-directed IRA investors gain access to new and exciting investment opportunities in an efficient and secure investment environment.

There has never been a better time to find a bad credit mortgage (Mortgage Introducer), Rated: A

Research conducted by the Online Mortgage Adviser website has discovered that up to 70% of potential mortgage applicants fail to approach lenders or other service providers because they mistakenly believe that their personal circumstances or financial histories will preclude them from being considered.

The study, which was based upon a survey of over 2,000 people nationwide, found that almost 50% of respondents believed that a low credit score, or evidence of previous issues, would automatically disqualify their application. 33% and 15% (respectively) felt that a zero-hour contract or payday loan would prevent them from achieving a mortgage loan.

stREITwise Launches Invest for a Cause (GlobeNewswire), Rated: A

stREITwise, an investment vehicle that makes commercial real estate investments accessible to everyone, is announcing the second annual Invest for a Cause holiday campaign. Through December 31st, their executive team will personally make a donation equal to 2% of any new investment to a non-profit of the investor’s choice.

2018’s Top Takeaways (Commercial Property Executive), Rated: A

But perhaps the biggest catchphrase of 2018 represents the rapidly evolving technologies that are benefiting—and some even say revolutionizing—the commercial real estate industry. So-called “proptech” includes a range of building performance solutions, along with financial benefits like the developing blockchain process protections and growth of the still fledging real estate crowdfunding business. (Our most recent discussions include our Mission: Success profile of MetaProp’s founders and the CFO Corner column “3 Ways to Leverage Fintech.”)

Small Banks Join Forces To Bring Fintech To Customers (Forbes), Rated: A

The move is driven in part by a desire to innovate and part survival. It comes as millennials are bypassing branches and traditional banking services for the fintech offerings at an increasing rate. Take Quicken Loans, the Detroit-based lender that operates Rocket Mortgage it’s completely digital platform, for one glaring example.

Stocks Hold Onto Gains Ahead of Powell Speech (Nasdaq) Rated: A

Counterstrike: The market looks like it might rise into the G-20 meeting that begins on Friday, so Jeremy thought this was a good time to pick up a couple names. Firstly, the editor added a 6% allocation in online marketplace Lending Tree (TREE), which has been halved from its 2018 highs. But it could be poised for a sharp move higher as a strong quarterly report has exposed its oversold position.

Online Lender Settles With FTC Over Refinancing Misrepresentations (Manatt), Rated: A

Issuing a warning to other lenders, the Federal Trade Commission (FTC) reached a deal with an online lender over charges the company violated the FTC Act by making false statements about student loan refinancing.

Velocity Commercial Capital Chooses SS&C for its Finance Transformation (SS&C), Rated: A

SS&C Technologies Holdings, Inc. (Nasdaq:SSNC), a global provider of financial services software and software-enabled services, today announced that Velocity Commercial Capital, LLC (‘Velocity’) has signed a multi-year agreement with SS&C Primatics’ EVOLV platform. EVOLV will help Velocity transform their financial operations and capitalize on growth opportunities in a controlled environment. Velocity, a direct portfolio lender, provides investment property loans for residential 1-4, multi-family, mixed-use and small balance commercial properties.

Guaranteed Rate Expands Its Footprint in Hawaii (GlobeNewswire), Rated: B

Guaranteed Rate, Inc. (“Guaranteed Rate”), one of the largest independent retail mortgage companies in the United States, today announced that it will acquire certain assets of Honolulu HomeLoans (HHL) and Hawaii Lending Alliance (HLA), growing its existing Guaranteed Rate presence in the Hawaii market and adding an experienced team of mortgage professionals.

BFS Capital Appoints Mark Ruddock as Chief Executive Officer (Citizen Tribune), Rated: B

BFS Capital announced today the appointment of Mark Ruddock as Chief Executive Officer, effective immediately. He will also join the company’s Board of Directors.

United Kingdom

Funding Circle and BBB announce £150m SME lending partnership (Bridging & Commercial), Rated: AAA

The British Business Bank (BBB) has committed to lend up to £150m to UK small businesses through Funding Circle.

The transaction has been made under the bank’s ENABLE Funding programme and is expected to support the growth of over 2,000 UK companies.

The new facility will provide senior financing to a transaction with the Funding Circle SME Income Fund Limited, the publicly traded fund that lends exclusively through Funding Circle.

Zopa sells batch of defaulted loans to boost investor returns (P2P Finance News), Rated: AAA

ZOPA has sold a batch of defaulted loans to a debt collection agency, which it says will enable a faster and higher recovery for investors.

The peer-to-peer consumer lender informed its investors last week about the debt sale. It said that it has received upfront payment for the loans in question and will pass on the proceeds to investors within the next couple of weeks.

The UK could be headed for a credit card crisis (GlobalData Email), Rated: AAA

Almost three quarters of retail consumers in the UK (those with liquid assets between £0 and £3,918) do not pay off their credit card balances in full each month, says 

Britain’s creative industries break the £100 billion barrier (Gov.UK), Rated: A

The UK’s roaring creative industries made a record contribution to the economy in 2017, smashing through the £100 billion mark.

Its value of the creative industries to the UK is up from £94.8 billion in 2016 to £101.5 billion, and has grown at nearly twice the rate of the economy since 2010, according to figures published today by the Department for Digital, Media, Culture and Sport (DCMS).

It continues to perform highly and over the last two months British tech firms Monzo, Farfetch and Funding Circle have surpassed the $1 billion mark, meaning they are now so-called ‘unicorns’.

China

Yirendai (YRD) Posts Quarterly Earnings Results, Misses Estimates By $ 0.17 EPS (Fairfield Current), Rated: AAA

Yirendai (NYSE:YRD) announced its earnings results on Monday, November 12th. The technology company reported $0.35 earnings per share (EPS) for the quarter, missing the Zacks’ consensus estimate of $0.52 by ($0.17), Briefing.com reports. The company had revenue of $163.20 million for the quarter, compared to the consensus estimate of $179.48 million. Yirendai had a return on equity of 40.40% and a net margin of 18.56%. The company’s revenue was down 28.3% compared to the same quarter last year. During the same period last year, the firm posted $0.74 EPS.

Source: Fairfield Current

Senmiao Technology (AIHS) Acquires 60% Equity Interest in Chinese Automobile Financial Leasing (StreetInsider), Rated: AAA

Senmiao Technology Limited (NASDAQ: AIHS), an online lending platform in China connecting investors with individual and small-to-medium-sized enterprise borrowers and creditors, today announced that it entered into an Investment and Equity Transfer Agreement (the “Agreement”) to acquire a 60% equity interest in Hunan Ruixi Financial Leasing Co., Ltd. (“Ruixi”), a Chinese licensed financial leasing company focusing on the auto industry with registered capital of $10 million. In exchange for the 60% equity interest in Ruixi from its three existing shareholders, Senmiao has agreed to contribute $6 million in registered capital to Ruixi. The acquisition closed on November 22, 2018.

Beyond The Sugar Rush: Strategic Stimulus For Chinese Stocks (Seeking Alpha), Rated: A

Private companies and even individuals have taken full advantage of loose credit conditions. Rising corporate bond defaults and nonperforming loans, as well as the recent collapse of hundreds of peer-to-peer lending platforms, suggest that at least in some cases, the money came too easily. Concerned global equities investors are already applying a substantial discount to Chinese stocks because of debt issues.

European Union

‘Inconsistent and punitive’ employee ownership rules are damaging Europe’s start-ups, say tech bosses (Telegraph), Rated: AAA

A group of thirty European tech start-ups have warned that the European Union’s “inconsistent and often punitive rules” employee ownership rules are hindering their businesses.

The entrepreneurs, which include the founders and chief executives of iZettleTransferWise and Delivery Hero, stated that laws across the continent make it costly for employers to give out stock options to employees.

The warning to EU policymakers, in an open letter, comes as research by venture capitalists Index Ventures finds that employees own only 10 per cent of late-stage start-ups in Europe, because of limitations brought about by regulations.  However in the US it is 20 per cent.

Online Lender October Officially Launches in the Netherlands (Crowdfund Insider), Rated: A

Online lender October (formerly Lendix) has launched in the Netherlands. Alongside this expansion, the Paris based October is providing SME financing in France, Spain, and Italy.

According to a note from October, SMEs may apply for loans ranging from €30,000 and up to €3.5 million.

Solactive Launches New Sharing Economy Index (Mondo Visione), Rated: B

Solactive is pleased to announce the launch of the Solactive Sharing Economy Index. It tracks companies active in the Sharing Economy, and other modern economies such as on-demand and subscription.

Formerly being attributed to open-source communities, the umbrella term “Sharing Economy“, nowadays reflects various economic activities such as peer-to-peer sharing of goods and services.

International

Zero Fees and Interest-free Loans in Decentralized Credit Networks (NewsBTC), Rated: AAA

Money lending is the core principle of any functioning economy. Decentralized credit networks which have recently seen a rapid increase in popularity promise easy and global access to credit and loans for businesses and the public by immediately connecting borrowers and lenders on the platform. Users of IOU credit networks can even take advantage of interest-free loans and zero fees.

Australia

RateSetter putting pieces in place to be Australia’s biggest consumer loans provider (Finder), Rated: AAA

When RateSetter started operations in Australia four years ago, the peer-to-peer (P2P) lending industry was in its infancy and its risk-based, investor-funded loan was seen as an alternative. But a lot can happen in four years. Today, major banks such as CommBank, HSBC and Citi use risk-based pricing, once only the domain of P2P lenders, while the formerly “alternative” RateSetter funded over $25 million in consumer loans this month.

Foggo said the lender has been “determined” to focus on specific products. One of its new ones is a renewable energy loan which it launched two and a half years ago.

India

Suspension of Aadhaar verification to hit lending of small fintech players (The Hindu Business Line), Rated: AAA

Fintech players, especially online lenders in the personal and consumer loans segment, are likely to face slowdown in business following the Supreme Court order that prevents private companies from seeking Aadhaar data for e-KYC and e-signatures.

Asia

Fintech firm Revolut gets green light to expand to Japan and Singapore (CNBC), Rated: AAA

British mobile bank Revolut has obtained licenses to operate in Japan and Singapore as it readies an expansion into Asia.

The London-based financial technology firm said Thursday that it had acquired a remittance license from the Monetary Authority of Singapore and full authorization from Japan’s Financial Services Agency.

It said Thursday that it intends to launch its platform in the Asia-Pacific (APAC) region in the first quarter of 2019, and is looking to select Singapore to host its APAC headquarters.

Online lending platform Oriente announces 5m initial funding for Southeast Asia (kr-Asia), Rated: A

Hong Kong-based online lender Oriente today announced a US$105 million initial round of financing to scale its business across Southeast Asia. The fintech startup already runs lending platforms in the Philippines and Indonesia and will launch in Vietnam soon.

Tapping into digital economy (The Jakarta Post), Rated: A

According to the latest survey by Google and Singapore’s Temasek Holdings, Indonesia’s digital economy is projected to triple to US$100 billion by 2025 from $27 billion this year, given the mushrooming of the country’s online marketplaces. The projection is not an exaggeration as indicated by the huge transaction values at a recent online shopping festival, dubbed a warm-up for the National Online Shopping Day in mid-December.

P2P lending transactions total Rp 13.8 trillion in first three quarters (The Jakarta Post), Rated: A

According to Financial Services Authority (OJK) data, transactions through peer to peer (P2P) lending totaled Rp 13.8 trillion (US$951 million) in the first three quarters of 2018, with the non-performing loan (NPL) rate recorded at 1.2 percent.

P2P lending transactions in 2018 have increased drastically compared to the last two years, with the OJK recording Rp 284 billion in transactions in December 2016 and Rp 2.56 trillion in December 2017.

Who’s afraid of peer-to-peer lending? (Bangkok Post), Rated: A

The recent announcement by the Bank of Thailand on peer-to-peer (P2P) lending rules represents a significant paradigm shift. If all goes to plan, by early next year Thailand will be among the few Asian countries, most notably China and Indonesia, to legalise this match-making platform between lenders and borrowers.

Bukalapak eyes investment products, P2P lending to cash in on fintech opportunity (Deal Street Asia), Rated: B

Indonesia’s online marketplace unicorn Bukalapak is planning to cast a wider net in the country’s booming fintech market. The company is looking at launching new investment products and enter new verticles such as P2P lending and remittances, co-founder and president Muhamad Fajrin Rasyid told this portal.

Authors:

George Popescu
Allen Taylor

Tuesday May 22 2018 Daily News Digest

GreenSky vs. LendingClub

News Comments Today’s main news: Kabbage to launch payment services. Funding Circle SME Income Fund limited force signal moves past key line. Zopa boosts TruFin results. DEPO launches to help lenders accept digital assets as collateral. Qudian stock drops 16.5%. Today’s main analysis: Deep dive into MFT 2018-2 vs. AVNT 2018-A (A MUST-READ). Today’s thought-provoking articles: Credit score improvement […]

GreenSky vs. LendingClub

News Comments

United States

United Kingdom

European Union

International

Other

News Summary

United States

Online lender Kabbage to launch payment services by year-end (Reuters) Rated: AAA

Kabbage Inc, a U.S. online lender for small businesses, plans to launch payment processing services by year-end, President Kathryn Petralia said on Monday, helping it to diversify and compete more directly with industry leaders PayPal Holdings Inc and Square Inc.

The Atlanta-based startup will offer tools to enable clients, mostly brick-and-mortar businesses, to accept card payments in-store and online, Petralia said in an interview.

Deal Deep Dive MFT 2018-2 vs AVNT 2018-A (PeerIQ), Rated: AAA

This week we compare 2 very different MPL personal loan securitizations – Marlette’s MFT 2018-2 Prime deal and Avant’s AVNT 2018-A Near Prime deal.

Collateral Comparison 

AVNT 2018-A has lower average loan size by $6,435, shorter weighted average loan terms by 9 months and higher WAC by 16.28%. This is a reflection of the quality of borrowers that Avant and Marlette target. Marlette’s prime borrowers have higher weighted average FICO scores by 59 points than Avant’s near prime borrowers. The geographic distribution is quite similar between the two deals.

Source: PeerIQ, KBRA

Bond Characteristics and Pricing

The significantly higher WAC on AVNT 2018-A leads to a 14.8% pickup in excess spread. KBRA’s base case loss estimate is 7.4% higher on AVNT 2018-A, which leads to a 7.4% higher loss-adjusted excess spread on AVNT 2018-A.

Source: PeerIQ, KBRA

Capital Structure

AVNT 2018-A has 3.3% lower O/C which is compensated by 14.8% higher excess spread. The A tranches have similar CE in both deals but Marlette’s A is rated one notch higher.

Source: PeerIQ

Avant continues to benefit from tighter underwriting criteria (Asset Securitization Report) Rated: A

The introduction of tighter underwriting criteria continues to pay off for the online consumer lender Avant.

The company, which was founded in 2012 and is based in Chicago, was able to lower the credit enhancement, again, on its latest securitization, the $221.9 million Avant Loans Funding Trust 2018-A.

Kroll Bond Rating Agency assigned an A- to the $149 million senior tranche of notes to be issued, which benefit from 38.42% credit enhancement. That’s down from 41.8% on the comparable tranche of its prior transaction, completed last year.

LendingTree Study Finds More than Half of My LendingTree Users Improved Credit Scores in Majority of 50 Metros Analyzed (PR Newswire) Rated: AAA

LendingTree today released its study on the top places with rising credit scores. With credit scores being a crucial component of personal financial stability and opportunity, LendingTree analysts decided to look at anonymized My LendingTree users who logged into their accounts in both the first quarter of 2017 and the first quarter of 2018 to determine the top metros for rising credit scores among the 50 largest in the United States.

Below are some of the key takeaways from the study.

  • JacksonvilleIndianapolisDenver and Tampa saw the highest rate of rising credit scores among the 50 biggest metros from Q1 2017 to Q1 2018.
  • Virginia Beach, Va.Los Angeles and Birmingham, Ala., had the lowest rate of rising credit scores, with 47 percent of Virginia Beach users raised their credit scores.
  • San Jose (Silicon Valley) saw the most dramatic rises in credit scores, with the highest rates of people who raised their score by more than 75 points and 100 points.
  • In the majority of the 50 metros analyzed, more than 50 percent of users improved their credit scores between Q1 2017 and Q1 2018.
  • About one in three increased their scores by over 20 points, and 3.5 percent were able to improve their scores by 100 points or more.
Source: Lending Tree
Source: Lending Tree

New Fintech IPO Offers Litmus Test for Online Lenders (Wall Street Journal) Rated: AAA

It wasn’t long ago that online lenders were ascendant. More than $3 billion in capital from investors as diverse as Japanese conglomerate SoftBank Group Corp. and celebrity chef David Chang gushed into lending startups in 2015, according to Dow Jones VentureSource. Analysts at Morgan Stanley predicted that year that the nascent industry would account for 10% of all unsecured consumer and small-business loans by 2020.

Investors soured on the sector. Shares of LendingClub, which once had a market value of about $10 billion, are down 77% from their IPO price. Prosper’s valuation was slashed by more than two-thirds in a private fundraising round last year.

Source: The Wall Street Journal

GreenSky said in its IPO filings that it has facilitated more than $12 billion in loans to consumers for home-improvement projects and elective medical procedures.

Part of GreenSky’s advantage comes from its relatively low customer-acquisition costs. LendingClub’s biggest expense is sales and marketing, which last year rose to $229.9 million, equivalent to 40% of revenue.

Source: The Wall Street Journal

 

How to responsibly invest in bitcoin (Bankrate) Rated: A

Recently, Bank of America, Chase, and Citigroup joined Capital One and Discover in banning cardholders from using them to buy cryptocurrencies. Credit cards were one of the most popular payment methods because of their relatively low fees and instant transaction rates, and investors are having to look at other options to make their investments.

Source: Bankrate

You can borrow money from a family member or friend, or you can use a peer-to-peer lending platform like SoFi to leverage funds for Bitcoin investments. However, be cautious when borrowing money for an investment. Interest rates can eliminate any gains you get from the investment, and the risk of losing money in such a volatile market is high.

Is Mulvaney targeting fintech or nonbanks? (Respa News) Rated: A

The acting director also responded to a question about qualified mortgages which has left the industry scratching its head since. Was Mulvaney separating fintech marketplace lending from traditional mortgage lending, or was he drawing a line between depository mortgage and non-depository mortgages?

 

Banking overhaul heading for likely passage in Congress (Yahoo! Finance) Rated: A

Legislation that would ease banking regulations — and modify rules governing credit reports and some consumer loans — is headed for likely passage in Congress any day now.

The bill cleared the Senate in March with some bipartisan support and is expected to be voted on by House lawmakers this week, perhaps as early as Tuesday.

The measure rolls back some of the regulations imposed by the Dodd-Frank Act of 2010. That legislation came on the heels of the financial meltdown that rocked the U.S. economy a decade ago, when risky and unaffordable mortgages contributed to millions of homeowners losing their houses to foreclosure.

Main Street Banks’ New Lending Rivals: Hedge Funds and Private Equity (Wall Street Journal) Rated: A

Main Street banks are feeling squeezed by competition from new rivals: nonbanks like hedge funds and private-equity firms that are elbowing into business loans.

Growth in business lending has picked up recently—it was up 3.3% year over year as of May 9, according to Federal Reserve data released Friday, after falling below 1% earlier this year. But the growth rate is still far below where it’s been in recent years, when loans to businesses grew at a double-digit clip for much of 2014, 2015 and 2016.

Making technology the solution, not the problem, at small banks (American Banker) Rated: A

The board members of R Bank in Round Rock, Texas — who include the Hall of Fame fireballer Nolan Ryan, a co-founder of the bank — hold accounts there, and they, like most other patrons, knew its old technology made for clunky customer service.

So, says president and CEO Steve Stapp, he channeled those irksome experiences into board support for an investment in a systems overhaul at the $455 million-asset bank.

For community banks in highly competitive markets, service with a personal touch can be a differentiator to win and keep customers. But when legacy technology hampers the customer experience, all the cups of coffee in the world won’t help.

 

Vota turns your credit card transactions into recommendations, helps you spot fraud (Tech Crunch) Rated: A

Blippy, which was hyped up to a $46.2 million valuation back in 2010 before the world realized that almost nobody wanted a dedicated network for sharing and viewing each others’ purchases. Well, guess what? Someone’s trying a Blippy-like thing again — this time, in the form of a new app called Vota, which automatically records your credit card purchases and the places you visit so you can share them with friends or family, or view them privately for your own reference.

As a byproduct of this data collection, you may spot credit card fraud or other errant charges, too, or just get a handle on your spending.

Optimal Blue First-to-Market with Pipeline & Lock Management APIs (Business Wire) Rated: B

Optimal Blue is proud to recognize enterprise SaaS digital mortgage solution leader, Capsilon, as its first strategic partner to complete certification with the highly anticipated Pipeline & Lock Management APIs. By debuting these innovative system-to-system API interfaces in the mortgage industry, Optimal Blue has enabled Capsilon’s digital mortgage platform to fully support the creation, management, registration, and locking of first-lien mortgages instantaneously with Optimal Blue. As a result of this advanced integration, a completed application and pre-approval are done in half the time of the traditional back-and-forth processes, empowering loan officers to be more competitive in today’s purchase market and win more business from real estate agents.

Mastercard Unveils Fintech Initiative Aimed at Digital Banking (Banker & Tadesman) Rated: B

The company on Monday announced the creation of Accelerate, a new initiative to drive growth at scale for the fast-evolving fintech industry, reflecting the company’s ongoing commitment to this sector.

Designed to operate alongside its successful Start Path program, Accelerate will broaden Mastercard’s engagement with the payment fintech community including the next generation of digital banks.

United Kingdom

Funding Circle Sme Income Fund Limited Force Signal Moves Past Key Line  (Concordia Review) Rated: AAA

Checking on current RSI levels on shares of Funding Circle Sme Income Fund Limited (FCIF.L), the 14-day RSI is currently standing at 58.31, the 7-day is at 65.97, and the 3-day is resting at 83.22.

Funding Circle Sme Income Fund Limited (FCIF.L) currently has a 14-day Commodity Channel Index (CCI) of 148.41.

Shares of Funding Circle Sme Income Fund Limited (FCIF.L) have a 200-day moving average of 103.52. The 50-day is 104.93, and the 7-day is sitting at 104.82.

 

Zopa stake boosts TruFin annual results (AltFi News) Rated: AAA

TruFin, the AIM listed fintech lender and payments provider, has released its first set of annual results following on from its public listing back in February. The numbers show a 7.67 per cent uptick in its valuation of its stake in p2p lender Zopa in 2017.

TruFin, which says it used an external company to aid the valuation of Zopa, re-valued its holding upwards by £2.6m to £36.5m over the course of the year. The firm, which was spun out of hedge fund Arrowgrass’ fintech holdings, holds a c.15 per cent stake in Zopa bought by Arrowgrass in 2014 for £15m. TruFin was set up by Henry Kenner, one of the founders of Arrowgrass, who is also its CEO and chairman. The hedge fund itself was launched by a group of Deutsche Bank traders in the wake of the financial crisis, including Kenner.

UK watchdog says automated financial advice falls short (Rueters) Rated: A

Advice doled out online or via smartphone apps, referred to in the industry as “robo advice”, aims to cut costs for customers looking to save or invest. It also seeks to foster innovation and increase competition in financial services.

But the Financial Conduct Authority (FCA) said two reviews of the industry uncovered problems among early entrants.

Exclusive: Former ADS Securities exec Jamieson Blake joins specialty lender Basset and Gold (Leaprate) Rated: B

Following our exclusive report from earlier this month that Jamieson Blake, Head of Client Experience at the FCA regulated London based arm of ADS Securities, had resigned from the company, LeapRate has now learned that Mr. Blake has landed – at specialty lending and retail investment firm Basset and Gold, as Head of Relationship Management.

China

Why Qudian Inc Stock Dropped 16.5% Today (Motley Fool) Rated: AAA

Shares of Qudian (NYSE:QD) closed down 16.5% on Monday after the Chinese online lender announced earnings that fell short of expectations.

Qudian reported “diluted adjusted net income per share” of $0.16 but GAAP diluted net income per share of only $0.15 per share. Whichever yardstick you use, though, these numbers appear to be lower than the $0.17-per-share estimate quoted on Yahoo! Finance. Revenue, on the other hand, came in at $273.7 million, significantly above consensus expectations for $214.6 million.

European Union

European Company Helps Turning Cryptocurrency into Collateral (the Merkle) Rated: AAA

Following a similar model as traditional depository services, DEPO gives lenders the freedom to accept digital assets as loan collateral. The platform also allows borrowers to keep ownership of their digital asset during the entire loan period.  The platform also protects future financial gain of the asset for borrowers with its decentralized design.

By employing the DEPO platform, lenders will be able to accept cryptocurrency as collateral for loans. To be protected, lenders can request additional collateral, or a partial sale of the asset should the market become excessively volatile at any time during the loan period.

Matthias Setzer of PayU (Lend Academy) Rated: A

In this podcast you will learn:

  • The history of Naspers, the parent company of PayU.
  • What PayU does and the markets where it operates.
  • Why Matthias decided to leave PayPal after 12 years and move to PayU.
  • How PayU approaches going into a new international market.
  • The Naspers investment in Chinese giant Tencent and the PayU footprint in China.
  • Why the number one country PayU is focused on today is India.
  • Why they invested €110 million in Kreditech and how they are leveraging that partnership.
  • The point of sale lending product they have launched in India with Kreditech.
  • The biggest growth drivers for PayU over the next 12-18 months.

New Insight will change the way you think about data (Instantor Email) Rated: A

Today Instantor, the Swedish fintech company making financial decisions easy, announces Insight. A new product that will transform the way financial organisations assess risk for loan applicants. By using robust machine learning, Insight analyses more than 70 predictive features and insightful patterns in historical banking, and can be used to make better risk and opportunity decisions. Instead of having a risk team spending months testing risk models, Insight ́s intelligent features will build the most optimal risk model using the clients own data and can be up and running within a week.

Bricknode and Lendytech unite under Untie Group banner (Finextra) Rated: B

Untie Group used to be several companies, the largest of which were Bricknode and Lendytech. They had a common founder in Stefan Willebrand and used, at least to a degree, the same self developed software. Also a number of people have gone from one firm to the other over the years.

International

Decentralized Lending Promises Easy And Global Access To Credit, But Is It Too Good To Be True? (Forbes) Rated: AAA

Since the rise of cryptocurrencies, the term “decentralized” seems to be everywhere. Decentralization has been proposed in many industries as a way to heighten transparency and make transactions simpler. One field in particular which has shown great potential for the application of decentralization is money lending. As many might rightly ask, don’t we need banks who are willing to take the financial risk and approve loans? As it turns out, maybe we don’t.

For lenders, the use of smart contracts allows for much easier assessments of the counter-party’s trustworthiness. Something that would take traditional audits weeks, not to mention the costs of such a traditional audit. Validating transactions and follow-up can become fully automated. Collateral is automatically returned at the end of the loan period or liquidated if the loan is defaulted on, removing many of the time-consuming actions that come with it.

Automation, ‘platformisation’ tipped to take hold in banking (AltFi News) Rated: A

The report, entitled Whose customer are you? The reality of digital banking, shows that 73 per cent of bankers believe retail banking will be at least 80 per cent automated in the next two years. A further 78 per cent see ‘platformisation’ steering the market in the future.

71 per cent of respondents are focusing their digital investment budget on cyber security, up from 34 per cent last year. Yet a mere 17 per cent are thinking about the risks of third-party integrations under Open Banking.

Fin-tech changes the loan process: Meet new lending models (Bankless Times) Rated: A

The new FinTech lending model opens new opportunities to people who were not able to borrow from traditional banks and other financial institutions because of the poor credit history and other factors. Such loans are now available to the new groups of people who need an instant funding, for instance, small business owners, students etc. In particular, entrepreneurs got a chance to get a loan without collateral, which a while ago was a real obstacle for many business owners.

Millennials Choose FinTech

Millenials are the first generation to accept the real advantages of new technologies and ready to use them for their own convenience. When it comes to lending process, millennials no longer wish to visit bank branches personally, stand in lines, deal with unnecessary paperwork and wait for months to get the approval.

End of the Line…

Today we are already witnessing a drastic change in the lending model that existed for centuries. Consumers want to have a more flexible way to lend money but most importantly, they want this process to be quick. The FinTech industry already gave us this opportunity and hopefully, the following changes will be for the better.

 

Asia

Kieran Arasaratnam to Join Credify Founding Team as CFO (Digital Journal) Rated: B

Credify Inc., a pioneer in decentralised reputation systems, is pleased to announce that Kieran Arasaratnam is joining the founding team as Chief Financial Officer.

Authors:

George Popescu
Allen Taylor