Friday April 20 2018, Daily News Digest

Marketplace Lending Securitization League Table

News Comments Today’s main news: OnDeck closes $100M credit facility. LendingClub expected to announce quarterly sales of $152.18M. Affirm expands to cover smaller purchases. Funding Circle lends 80M GBP through IFISA. China Construction Bank opens robot-only branch. Today’s main analysis: Originator league table. UK P2P lending nears 9B GBP. Today’s thought-provoking articles: Top fintech investors by stage. Interview with […]

Marketplace Lending Securitization League Table

News Comments

United States

United Kingdom

China

Australia

Other

News Summary

United States

OnDeck Announces New 0 Million Revolving Credit Facility (PR Newswire) Rated: AAA

OnDeck announced today the closing of a $100 million asset-backed revolving credit facility with Pioneers Gate LLC, a lending vehicle of a leading life insurance company managed by 20 Gates Management. The new facility provides the longest revolving funding period of any of OnDeck’s funding sources, and the lowest interest margin of any of OnDeck’s variable-rate funding facilities to date.

Lending Club (LC) Expected to Announce Quarterly Sales of 2.18 Million (The Lincolnian Online) Rated: AAA

Wall Street brokerages expect that Lending Club (NYSE:LC) will announce sales of $152.18 million for the current fiscal quarter, according to Zacks. Three analysts have provided estimates for Lending Club’s earnings. The lowest sales estimate is $150.00 million and the highest is $154.53 million. Lending Club posted sales of $124.48 million during the same quarter last year, which suggests a positive year-over-year growth rate of 22.3%. The firm is scheduled to announce its next earnings results after the market closes on Tuesday, May 8th.

On average, analysts expect that Lending Club will report full-year sales of $688.45 million for the current financial year, with estimates ranging from $680.00 million to $693.30 million. For the next fiscal year, analysts expect that the company will post sales of $803.61 million per share, with estimates ranging from $773.00 million to $858.31 million. Zacks Investment Research’s sales averages are an average based on a survey of sell-side research analysts that cover Lending Club.

Affirm Expands Offering to Cover Smaller Purchases with Simple, Transparent Payments (The Virginian Pilot) Rated: AAA

Affirm, Inc., the company founded by entrepreneur Max Levchin to provide fair and honest financial products, today announced Affirm will partner with brands and retailers to offer shoppers a simple, no-interest payment option on purchases of any size via three easy, monthly payments. Now, Affirm’s financial products are available for purchases of any size, marking an expansion for the company. Affirm will continue to offer shoppers the option to buy now and make simple, transparent payments over time for purchases up to thousands of dollars, with terms ranging from 3 to 36 months.

The expansion of Affirm’s capabilities will be especially valuable to fashion and apparel brands and retailers that want to offer a quick and convenient payment method that better aligns with shoppers’ cash flows and are more transparent than traditional credit.

PeerIQ Releases Their Marketplace Lending Securitization Tracker For Q1 2018 (Lend Academy) Rated: AAA

We see another robust quarter for marketplace lending securitizations with $4.3 billion in new deals.

SoFi lead the way again with $2.6 billion or around 60% of the market with two huge student loan deals and a consumer loan deal.

Online Lending in Risk On Mode: Unprecedented 21 Months of Non Stop Securitization Issuance (Crowdfubd Insider) Rated: A

The most recent report stated that PeerIQ has observed an “unprecedented 21 months of non-stop issuance. Markets remain in a “risk-on” mode and MPL investor appetite continues to grow. This is a very bullish statement for online lenders coming at a time when interest rates are rising as is competition in the sector is increasing.

Top Seed-Stage FinTech Investors (Crunchbase News) Rated: AAA

Crunchbase News recently took a deep dive into the U.S. FinTech industry’s Q1 2018 venture activity. We found that deal volume in 2017 amounted to more than $7 billion in venture funding for seed, early, and late-stage startups. As 2018 came to a head, the number of deals in the space declined slightly, while venture capital dollars increased by 37 percent quarter over quarter.

The firm has made more than 690 investments in technology companies, with lead investments in 24 startups. Plug and Play also made an early bet on PayPal, now a public company with a market cap over $90 billion. California-based Hippo Insurance picked up an investment by Plug and Play in its $25 million Series B in January 2018. Hippo Insurance was coincidentally also mentioned in our Crunchbase News analysis of startups that have weird names.

Source: Crunchbase News

Defi Solutions, a SaaS platform for lenders, was the latest growth-stage FinTech company to score an investment by the firm. Bain Capital Ventures was the sole investor in the startup’s $55 million Series C in January 2018.

Source: Crunchbase News

RealtyMogul’s MogulREIT I Closes Senior Debt Investment in San Francisco (The Virginian Pilot) Rated: A

MogulREIT I today announced that it has completed an investment in a $6.69 million mixed use building in San Francisco, California, its 15 th acquisition since inception. MogulREIT I was designed to offer investors potential cash flow through managing a diversified portfolio of commercial real estate investments, including, but not limited to medical office buildings, multifamily apartment complexes, office spaces and retail shopping centers.

Ascentium Capital Surpasses $ 4 Billion in Originations (deBanked) Rated: A

Texas-based lender Ascentium Capital announced last week that it had surpassed $4 billion in origination volume since the company was founded in 2011.

The other business channel is a direct channel where Ascentium makes direct loans to small and medium sized businesses of up to $250,000. Depping told deBanked that the company’s direct channel makes up about 30 to 40 percent of its business.

Q&A: Renaud Laplanche on Starting Upgrade and Offering New Credit Products to Consumers (LendEDU) Rated: AAA

Q: It looks like you co-founded Upgrade with a total of 6 co-founders. How has starting Upgrade been unique from a team building perspective?

A: Over the last year we’ve on-boarded more than 250 team members across our three offices – San Francisco, California headquarters, Phoenix, Arizona operations center and Montreal, Quebec, Canada development center. It has been an incredible year, especially looking back at the team we’ve formed.

Q: How did the challenges of starting LendingClub compare to the unique challenges of starting Upgrade?

A: The challenges are quite different because the launch of each company stands about decade apart, so the landscape is very different.

Q: Beyond credit monitoring, how is Upgrade helping to educate consumers about their finances?

A: We believe helping people get smarter about credit can enable them to access more affordable credit in the future, and that’s why we launched Credit Health. Credit Health comprises of a range of tools that we think can help people understand their credit profile and what they can do to improve it. In addition to credit monitoring and alerts we offer Credit Health Insights – a library of educational articles and videos. Credit Health also features a credit simulator that gives you customized advice and tips tailored to your unique credit history. We haven’t seen other credit monitoring platforms offer this the same way we do.

Blockchain Startup Backed By Billionaire Bitcoin Bull Peter Thiel Gets $ 28 Million Investment (BTC Manager) Rated: A

Harbor, a blockchain startup backed by billionaire bitcoin bull Peter Thiel, has received an additional $28 million investment that it hopes will make blockchain real-estate investing a reality.

This latest cash infusion was led by Thiel’s Founders Fund, venture-capital fund Andreessen Horowitz, and cryptocurrency investment firms Pantera Capital and Craft Ventures. The San Francisco-based Harbor secured $10 million in Series A financing in February 2018, raising its total investments to $40 million.

LendingClub vs. Prosper Review: Here’s What You Need to Know (Student Loan Hero) Rated: A

In recent years, there’s been rising interest in peer-to-peer (P2P) lending. A report from Research and Markets estimates that P2P lending could grow by 53.06% between 2016 and 2020, while Transparency Market Research projects that the global P2P market will be worth $897.85 billion by 2024.

Source: Student Loan Hero

Need an Alternative to a Capital One Personal Loan? Here’s Where to Look (Student Loan Hero) Rated: B

For example, if you’re looking for a small loan — say, around $500 — you should skip online lenders. Most don’t provide loans for less than $1,000 or $2,000. Also remember that your credit score is vital to the approval process, so if you can’t get one on your own, consider getting a cosigner.

Source: Student Loan Hero

Why digital banks are welcoming CRA revamp (American Banker) Rated: A

To get a sense of why Ally Bank wants the Community Reinvestment Act rewritten, look at its situation in Utah.

Since it has no retail branches, the $137 billion-asset Ally is assessed for CRA compliance for its lending in Salt Lake City, where its bank is headquartered. But Ally gets no CRA credit for lending in Detroit, where its holding company is based and where nearly four in 10 households are living in poverty.

Quarles suggests new Fed approach to ILCs (American Banker) Rated: B

The Federal Reserve Board’s chief regulator suggested he was open to companies receiving industrial loan company charters, a sign that the central bank’s view on ILCs may be evolving.

“I don’t think of [ILCs] as a particularly special, excessively problematic case,” said Federal Reserve Vice Chairman for Supervision Randal Quarles at an International Monetary Fund forum Wednesday.

Education Loan Finance Receives AAA Ratings on Inaugural Securitization Deal (Business Wire) Rated: A

Education Loan Finance (ELFI), a division of SouthEast Bank, focusing on student loan debt refinancing and consolidation, announces the close of its inaugural securitization of refinanced student loans. Education Loan Finance is the first student loan refinancing lender to receive the AAA rating from both Standard & Poor’s and DBRS on its senior notes in its first securitization transaction comprised of this type of education loan product.

The $200 million transaction was comprised of $24.784 million of variable rate Class A-1 Notes, $158.65 million of fixed rate Class A-2 Notes, and $16.566 million of Class B Notes. The Class B Notes are rated A by DBRS. Citi and Credit Suisse served as joint lead managers on the transaction.

The process of elimination in multiple-offer scenarios (The Ledger) Rated: A

If a house is listed for $400,000 and someone presents a cash offer for $380,000, that will not be favored over an offer for $400,000 from a person getting an 80 percent loan.

For example, a 75 percent loan from an online lender with no ties to the Nashville area could be trumped by a 100 percent loan from a local, well-known lender that provides physician loans.

Boulder solar power finance firm lands big bucks (like $ 112M of them) (Denver Business Journal) Rated: A

Boulder-based Wunder Capital, which lends money for commercial-scale solar power projects, said Wednesday it’s raised $112 million in equity and debt financing to grow the company.

The Series B financing round was led by New York City investment firm Cyrus Capital Partners, which manages $4 billion in investments. Existing investors also were involved in the round, including Techstars Ventures which led the company’s Series A round of funding in March 2016.

United Kingdom

£80m lent through Funding Circle Isa (Bridging & Commercial) Rated: AAA

Funding Circle has announced that approximately £80m has already been lent to thousands of businesses through its Innovative Finance Isa (IFIsa).

The Isa offers an estimated tax-free projected return of 7.2% and is a flexi Isa which allows investors to take money out of their account and put it back later in the tax year without losing their tax-free entitlement.

There is an initial minimum investment of £1,000 and investors will be able to transfer exiting Isas into the Funding Circle Isa later this year.

 

 

P2PFA: UK Peer to Peer Lending Industry Nears £9 Billion in Total Lending (Crowdfund Insider) Rated: AAA

The UK Peer to Peer Finance Association (P2PFA) has released Q1 data for its member platforms. According to the industry association, P2P lending is nearing £9 billion in loan originations having provided finance for approximately 50,000 business and 221,000 individuals. Total investors stand at around 150,000.

 

Source: Crowdfund Insider

How Starling Bank is taking cues from Amazon (Tearsheet) Rated: AAA

And digital-only banks with a license, like Monzo, Starling, Tandem and OakNorth, are growing market share.

What are the biggest problems with banking today?
Banking as it is today sucks — it’s hard to easily manage account openings, and [until recently] to send payments to friends. That’s why Venmo has been so successful, but this should be a thing banks do.  You shouldn’t have to read an FAQ to use the mobile app or set up a bill pay.

LendInvest Calls Upon UK Government to Improve Finance Access for Property SMEs (Crowdfund Insider) Rated: A

LendInvest reported that in a new report entitled Putting Finance First: the alternative route to funding Britain’s SME housebuilders, the online lender recognizes that while the government is trying to help improve the outlook for property SMEs, but then argues that not enough is being done to put rhetoric into action. The report focuses on three proposed initiatives that combine existing government-backed funding mechanisms with the experience and expertise of alternative lenders, like LendInvest, to speed up and increase the supply of finance to property SME businesses:

  • Homes England: Should deploy its £2.5 billion Home Building Fund through funding lines agreed with alternative lenders.
  • Local authorities: Should co-invest with alternative lenders in local developments, utilizing the Public Works Loan Board mechanism to provide discounted capital for SMEs.
  • The British Business Bank: Should appoint more alternative lenders to use the ENABLE Guarantee programme to underwrite property investment and development loans.

Malta-Based Decentralized Ventures to Spearhead Crypto Island’s Blockchain Services Provision (Blockchain News) Rated: B

Blockchain services provider Decentralized Ventures on Tuesday announced its official launch, with the objective of bolstering Malta’s crypto communities.

A partnership between initial coin offering (ICO) specialist TokenKey and token research and Blockchain consultancy Strategic Coin Inc., Decentralised Ventures is designed to support the Maltese government’s plans to create the world’s first fully regulated market for ICOs, DLT and virtual currencies, a statement said.

 

JustUs launches IFIsa to support ethical housing scheme (Bridging & Commercial) Rated: B

The IFIsa aims to raise £367,500 and will offer a return of up to 6.5% to investors.

JustUs will provide a bridging loan to Mersten for up to 50% of the property’s value to fund the renovation.

China

 

China Construction Bank opens robot-run branch (Fintech Futures) Rated: AAA

China Construction Bank (CCB) has opened a branch in Shanghai run solely on the power of pure technology.

According to the South China Morning Post (SCMP), the branch has no human staff and instead uses facial recognition, artificial intelligence (AI) and virtual reality (VR) to provide the bank services.

SCMP says it is hyped as a first for the Chinese banking industry, and the Beijing-based bank says it has installed 1,600 smart machines at its 360 branches in the city to ramp up its appeal to tech-savvy customers and trim staff costs.

CreditEase’s Hou outlines allocation outlook (Asian Investor) Rated: A

Beijing-based CreditEase, a peer-to-peer P2P lending platform and wealth management platform, has been busy building its roster of mutual fund, trust and insurance products.

European Union

iZettle squares up to Square with e-commerce platform launch (Fintech Futures) Rated: A

Swedish mobile payments firm iZettle is taking on Square with the launch of its new e-commerce platform that will allow merchants to sell in-store and online.

Called iZettle E-commerce, it lets small business owners set up and customise a new webshop or start selling across channels online, including social media, blogs and existing websites.

International

Digital banking’s key trends: Demand, competition, mobile on the rise (American Banker) Rated: AAA

Two global studies — a study of 150,000 consumers polled by Gallup for the World Bank for its Global Findex Database, and a survey of 5,200 consumers by the tech giant Oracle — found complementary trends in the use and adoption of digital banking.

For example, 60% of customers globally want to open a bank account online, according to Oracle’s survey.

Many are already there: Sixty-seven percent of customers globally are on digital banking platforms now, according to Oracle; the World Bank reports that 515 million customers worldwide opened a banking account through a mobile money provider in the last three years.

 

More Than Half Of Cards Issued Globally Were EMV-Enabled (PYMNTS) Rated: A

Data from EMVCo shows that 54.6 percent of all cards issued globally by the end of 2017 were EMV-enabled.

In addition, the number of EMV payment cards in circulation around the world increased by 1 billion over the previous 12 months — to a total of 7.1 billion.

“Both EMV chip card issuance and EMV chip transactions surpassing 50 percent globally is testament to the increasing maturity of the worldwide infrastructure, and [is] a significant milestone for the payments community,” EMVCo Executive Committee Chair Jack Pan commented.

 

Australia

Australia’s top bank says it charged dead clients for advice (CNN) Rated: AAA

Australia’s top bank has admitted to charging fees to clients it knew had died years previously.

Commonwealth Bank of Australia (CBAUF) told a government inquiry Thursday that the practice of billing deceased customers for financial advice stretched back years. In one instance, an adviser at the bank’s financial planning business was collecting fees from a client more than a decade after they had died.

The revelations emerged as part of a Royal Commission, or public inquiry, into malpractice in Australia’s financial services industry.

One winner from the banking royal commission (The Australian) Rated: B

The peer-to-peer lending space may be a major beneficiary of the poor practice scandals coming out of the Royal Commission, according to one non-bank lender.

ME hikes home loan interest rates: does this mark the end of super low rates? (MOZO) Rated: A

Online lender ME has announced it is increasing home loan interest rates across its variable mortgage range effective today, citing increased funding costs as the reason – and it’s not the first to do so.

ME hiked its standard variable rate for existing owner-occupier principal-and-interest borrowers with an 80% LVR by 6 basis points, bringing it to 5.09% p.a. (5.11% comparison rate).

Existing investor principal-and-interest borrowers were hit with a bigger increase of 11 basis points, while interest-only borrowers saw the biggest increase of 16 basis points.

Source: MOZO
Asia

 

High investor FOMO about P2P lending in SE Asia: Funding Societies co-founder Kelvin Teo (Deal Street Asia) Rated: AAA

Your Series B round is likely the largest for a P2P lender in the region. Is that a measure of how strong the investor interest in this space and the potential for the sector in Southeast Asia?

P2P lending is a promising sector in Southeast Asia. We see strong investor interest, but perhaps too much, especially for emerging markets like Indonesia where the fear-of-missing-out (FOMO) is high. SME lending is a technical and a very localized business, and Southeast Asia apparently is not easily understood. We did not realize the significance of them until we started speaking to investors for Series B. In all candour, it was slightly painful to interact with investors who do not know Southeast Asia and/ or lending business.

Is $25 million the amount that you were looking to raise? 

We have a trust-based relationship with our shareholders. Our early discussion with our Series A lead investor Sequoia was to raise US$ 10M – 15M.

Alternative investment opportunities in Việt Nam (Viet Nam News) Rated: A

Access to and use of formal financial services is low in Việt Nam compared with other countries in the region, with only 31 per cent of all adults having formal bank accounts in 2016, according to the World Bank.

In 2016, 14.6 per cent of Vietnamese had saved money with a formal financial institution, 18.4 per cent had a loan with a formal financial institution, and only 26.5 per cent had access to a debit card. Interestingly, about 30 per cent of adults borrowed from friends or family in 2016 in Việt Nam, against 18.4 per cent who have borrowed from a financial institution.

Latin America

Creditas investment a Brazilian first for Santander InnoVentures (Bankless Times) Rated: AAA

Santander InnoVentures, the fintech venture capital fund of Santander Group, announced today an investment in the startup Creditas, a Brazilian secured lending platform. This is Santander InnoVentures’ first investment in Brazil and second in Latin America.

Creditas also announced today an increase of its Series-C funding round to $55 million with the addition of Santander InnoVentures and Amadeus Capital Partners. The round was led by Vostok Emerging Finance (VEF), a company focused on early and growth stage fintech companies across emerging and frontier markets, based in Sweden. Current investors also participated in the round, including Kaszek Ventures, Quona Capital, QED Investors, International Finance Corporation and Naspers Fintech.

Authors:

George Popescu
Allen Taylor

Tuesday April 17 2018, Daily News Digest

Tuesday April 17 2018, Daily News Digest

News Comments Today’s main news: dv01 to expand into mortgages. Zopa prepares for next-gen bank launch. JD Finance raises over $2B. Moody’s assigns ratings to Prospa. Namaste Credit raises $3.8M. Today’s main analysis: Venture capital reaches record high. Today’s thought-provoking articles: Interview with Prosper’s CFO. Fintech lenders give mortgage borrowers an edge. Hexindai’s IPO prospectus. Where top European banks are investing. What Aussie […]

Tuesday April 17 2018, Daily News Digest

News Comments

United States

United Kingdom

China

European Union

International

Australia

India

Other

News Summary

United States

dv01 Announces Expansion Into Mortgages; Signs As Loan Data Agent For CSMC 2018-RPL2 (Crowdfund Insider) Rated: AAA

dv01, the data management, reporting, and analytics platform that offers institutional investors transparency and insight into lending markets, announced on Friday it participated in its first mortgage securitization and acted as loan data agent for CSMC 2018-RPL2, a securitization of $275 million re-performing loans serviced by Select Portfolio Servicing (SPS). The company revealed it introduced the role of Loan Data Agent in 2016 and provides Loan Data Agent services for an aggregate securitized collateral balance in excess of $25 billion of online lending loans.

CFO Usama Ashraf Talks Borrowing and Investing with Prosper (LEndEDU) Rated: AAA

Recently, I had the privilege to pick the brain of the Chief Financial Officer (CFO) of an industry leading company in the fintech space. Usama Ashraf is the CFO of Prosper, the first peer-to-peer platform in the US that connects people who want to borrow with individuals and institutions that are looking to invest in consumer credit.

Q: What are some unique challenges that come with the job of managing the finances of Prosper?

A: If you look at our business today, we have a 10+ year track record. We launched in 2006, and we’ve done over $12 billion in cumulative loan originations. A key differentiator in this space is the ability to generate cash flow, and last year, we were cash flow positive for three consecutive quarters starting in Q2.

Q: How has the health of the personal loan market in the recent past impact Prosper’s growth?

A: 2017 really allowed us to stabilize the business. We had stable funding. We had growth of over 30% on the platform, and as mentioned, we generated cash for three consecutive quarters. So, the business is now on a healthy footing, and we’ve returned to strong growth.

Q: Are you optimistic about the overall market in the next few years?

A: The total consumer credit market today is over $10 trillion. When you look at our originations last year, we did about $3 billion. The consumer credit space is a massive market, and it’s also a key element of growth in GDP in the US. 70 percent of GDP comes from consumer spending, so consumer credit and spending is a massive part of the US economy. Since the US economy is mostly expected to grow over the next several years, we are optimistic about the opportunities that growth presents for us.

How fintech lenders give mortgage borrowers an edge (Market Watch) Rated: AAA

 

  • Fintech lenders reduced the time it takes to process a loan by roughly 10 days as compared with the average processing time for mortgages. For refinances, they’re nearly 15 days faster than more traditional lenders.
  • In instances where a lender is seeing greater demand for loans, tech-based lenders are better at handling the larger inflow of applications. Double the application volume raised the loan processing time only by 7.5 days for fintech lenders, versus 13.5 days for traditional ones. Moreover, the researchers found that tech-based lenders lower their denial rates when there’s a higher volume of applications.
  • In parts of the country where fintech lenders have a greater presence, existing borrowers are more likely to refinance. But the efficiencies created through their platforms make it more likely that borrowers will see an optimal result from a refinancing, including getting the market interest rate.
  • The default rate on Federal Housing Administration loans originated by fintech lenders is roughly 25% lower than traditional ones.

Cross River Selected As Two-Time Winner In LendIt Fintech Industry Awards (PR Newswire) Rated: B

Cross River has been selected as the nation’s Most Innovative Bank for the second year in a row at the LendIt Fintech Industry Awards, the world’s leading annual event in financial services innovation, held in San Francisco at LendIt Fintech USA. Other nominees included BankMobile, CBW Bank, Marcus by Goldman Sachs and HSBC.

 

Mastercard Eyes Blockchain for Fighting Fake Identities (Coindesk) Rated: A

In an application released by the U.S. Patent and Trademark Office (USPTO) last Thursday, Mastercard describes a system in which a semi-private or private blockchain would be used to receive and store identity data, the pieces of which could include a “name, a street address, tax identification number” and more.

The company states in the filing, which was originally submitted in September 2017, that the tech could help it block the use of fake identity data within its systems.

How US banks are preparing for the GDPR (Tearsheet) Rated: A

On May 25, EU companies will no longer be able to collect and use personal data without the individual’s consent, under the General Data Protection Regulation. U.S.-headquartered banks and fintech companies with global operations are anxiously preparing to comply with the new rules, anticipating a time when U.S. customers will demand the same protections from their home institutions.

Stash Teams with Green Dot to Become a Challenger Bank (Finovate) Rated: A

Mobile financial services company Stash first revealed its plans to launch banking services in October of last year, positioning itself as a challenger bank with mobile-centric investment and retirement capabilities. And, as with all U.S.-based challenger banks, Stash will house the funds at a traditional bank. Today, the New York-based company announced it has selected Green Dot and its subsidiary bank, Green Dot Bank, Member FDIC, to keep user’s funds safe.

Through the partnership with Green Dot, Stash will deliver debit cards with no overdraft fees and provide access to a network of free ATMs across the U.S. The app will also share insight into clients’ financial health, with actionable advice on spending, saving, investing, and retirement via Stash Coach.

‘In this market, it’s disrupt or die’: The innovations local banks are using to stay ahead (Orlando Business Journal) Rated: A

Many Central Florida bank customers nowadays want more than just the ability to move money around. David Stahl, senior vice president, SunTrust: We acquired an online lender called LightStream two years ago and that has been a huge opportunity for us. Personally, I used it. There is a need out there for consumers.

Plaid Assets and Day 1 Certainty: a win-win solution for digital mortgage (Plaid) Rated: B

Today, we’re thrilled to announce that our Assets product is out of beta and Plaid is officially approved to supply asset verification reports to Fannie Mae as part of their Day 1 Certainty initiative. This means that lenders can embed Plaid directly into their application experience and provide borrowers with a fast, seamless experience, reduce the time it takes a loan to close, and have peace of mind offered by Fannie Mae’s protection against repurchase for key loan components. It’s a win-win solution.

Using Plaid, borrowers can now share with lenders the data they need, directly from the source, including:

  • Bank account, transaction, and bank account owner information from multiple accounts and institutions in a single, standardized JSON report delivered via API
  • An auditable PDF version of the same information, also via API
  • The ability to permission secondary investors like Fannie Mae to securely retrieve the same data directly from Plaid, enabling programs like Day 1 Certainty

 

United Kingdom

Bank and P2P boards take shape as Zopa prepares for next gen bank launch (Global Banking and Finance Review) Rated: AAA

Zopa, the pioneering financial services company, has today announced a governance restructure in advance of launching its next generation bank.

The re-structure will establish separate boards for the Zopa P2P business, proposed bank (subject to banking licence approval) and Group in order to facilitate the increasing scale of the business, ensure good corporate governance and protect the interests of its customers.

The changes come with the appointment of two new board chairs as well as two new independent non-executive directors to the proposed bank. Christine Farnish will be chair of the P2P board and Peter Herbert will be chair of the proposed bank.

Ratesetter review: peer-to-peer lender’s best rates, risks and more (Love Money) Rated: AAA

RateSetter was founded in 2010 by Rhydian Lewis (pictured) and has been used by more than 62,633 lenders, to lend more than £2.4 billion.

RateSetter will lend to either individuals or businesses. You start by deciding how much to lend: the average amount invested is £14,299, but you can start with £10.

You can borrow between £1,000 and £25,000 – depending on your circumstances.

Finastra brings mortgage solutions to the cloud with Microsoft Azure (Finastra) Rated: A

Finastra is bringing its mortgage lending solutions to the cloud via Microsoft Azure. As part of the strategic alliance between the two companies to use Microsoft’s enterprise-ready, trusted cloud platform as a base for a selection of Finastra’s payments and retail banking technology, Finastra’s Fusion MortgagebotLOS product is now available via the Azure cloud. As of today, US clients that access this service will realize streamlined access to their data, improved operational control and increased productivity.

Government chooses fintech start-up to lead UK tech mission to China (Internet of Business) Rated: B

Fintech start-up Nuggets has been chosen by the UK government and the Mayor of London to embark on two trade missions to China this year.

The company – which has developed a blockchain-based, e-commerce payments and ID platform – will help represent the Department for International Trade, the Greater London Authority, and the City of London Corporation on the trips.

China

China: WeiyangX Fintech Review (Crowdfund Insider) Rated: AAA

According to a person with direct knowledge of the matter, JD Finance is nearing the closing of a new round of financing of over $2 billion (¥12.6 billion).

After this investment, the market valuation of JD Finance is expected to exceed $20 billion (¥126 billion).

CHINA SECURITIES led this financing, which was followed by Oriza Holdings and other institutional investors.

Hexindai: Don’t Miss Out On A Good Target Because Of Industry-Wide Concerns (Seeking Alpha) Rated: AAA

Hexindai Inc. had their IPO on NASDAQ on November 03, 2017, raising US$50 Million. HX is a fast-growing consumer lending marketplace facilitating loans to meet the increasing consumption demand of the emerging middle class in China.

This “online and offline” model led to significant business growth for HX since its inception. The total amount of loans facilitated through the online marketplace increased by 54.4% from Q2 2016 to Q2 2017. Also, the company has experienced a business shift from collateral loans (auto loans etc.) to credit loans, which drives the boost in the the company’s customer base growth:

Source: HX’s IPO prospectus
European Union

Where top European banks are investing in fintech – CB Insights (Fintech Futures) Rated: AAA

Research company CB Insights analysed the private market fintech investment activity of the top European banks and their venture arms, by assets under management (AUM), from 2012 to Q2 2018 (as of 11 April 2018).

According to the graphic below, created by CB Insights, European banks are placing strategic bets across wealth management, lending, payments and regulatory technology and also blockchain.

Source: Fintech Futures

New Company Opens Door to Malta’s Crypto Market (Nasdaq) Rated: B

Decentralised Ventures is a partnership between Malta-based Initial Coin Offering (ICO) specialist TokenKey and token research and Blockchain consultancy Strategic Coin.

Decentralised Ventures offers a complete list of end-to-end services for any organization involved in or looking to enter the token, crypto or peer-to-peer lending markets.

International

Venture capital investment in FinTech reaches record $ 27.4 billion high (Consultancy) Rated: AAA

Confidence in FinTech has accelerated venture capital financing in the industry to a record level of $27.4 billion in 2017 – a growth of 18% from 2016. According to a recent report from consulting firm Accenture, the growth in FinTech investment has been driven by a surge in deal value in the US, UK and India.

In the US, the value of venture capital investment deals jumped 31% to $11.3 billion in 2017. Meanwhile, in the UK, deal values almost quadrupled to $3.4 billion, while India saw a near quintupling of investment to $2.4 billion in 2017. The volume of global FinTech deals also rose greatly, from about 1,800 in 2016 to almost 2,700 in 2017.

Source: Consultancy
Source: Consultancy

BotBird – Your cryptocurrency investment partner for modern trading! (AMBCrypto) Rated: A

BotBird is introducing Social Peer-to-Peer Lending Market where the community members can make use of their digital assets as collateral to get cash. This involves no risk and is equally benefited to both the borrowers and lenders. The main goal of BotBird is to connect the lenders and borrowers across the world through the P2P lending marketplace.

Lenders can earn up to 50 percent monthly interest while trading.

Trends: More innovative mobile money services on the horizon (The Edge Markets) Rated: A

According to McKinsey & Co’s global banking report released last month, digital finance has the potential to reach more than 1.6 billion new retail customers in emerging economies and increase the volume of loans extended to individuals and businesses by US$2.1 trillion (RM8.1 trillion).

According to statistics provided by Bank Negara Malaysia, the national transaction value per capita for e-payments amounts to nearly RM613.6 million last year, up 11.4% from RM550.6 million in 2016. There was no data for the total number of mobile payments made in 2016, but the central bank stated last year that it came to about RM500,000.

4 Blockchain Startups to Keep an Eye On (Coin Announcer) Rated: B

2. Alchemy
Founded by 21-year-old entrepreneur, Justin Jung, the P2P lending platform is looking to take existing P2P concepts and completely disrupt them by creating a CDO (collateralized debt obligations) market that will allow tranched investments within the platform.

Australia

Online small business lender assigned Moody’s ratings (Australian Broker) Rated: AAA

Leading global ratings agency Moody’s has assigned ratings to Prospa’s Australian small business loan asset backed securities (ABS) trust.

This is the first rated ABS issuance backed by unsecured small business loans in the Australasian market. It is also one of the few that have been issued globally and rated by one of the big three credit rating agencies.

A total of $83.25million in debt securities were rated as follows: $64.8m Class A Notes assigned A3; $14.6m Class B Notes assigned Ba2 and $3.7m Class C Notes assigned B3.

How Australia’s fintech SME lenders have learnt from the US (Finder) Rated: AAA

Speaking at the AltFi Australasia Summit 2018, CEO of OnDeck US Noah Breslow discussed how it first launched in the US over a decade ago in 2007. And while it only launched its Australian lending business in 2015, the Australian small business lending market has traversed the same course as the US market in a markedly shorter time.

Source: OnDeck

While the actual alternative small business lending market remains largely unregulated, other initiatives put in place, such as the pursuit of open banking and comprehensive credit reporting (CCR), will have a marked impact on the sector.

In the US, 70% of SMEs perceived there to be more small business lending options than five years ago, but that number is only 30% in Australia.

Online small business lending growing fast (Australian Broker) Rated: A

The online small business lending market in Australia is growing at a faster rate than the US market did at a similar stage of development, the CEO of OnDeck Global has said.

Speaking at the AltFi Australasian Summit in Sydney, CEO Noah Breslow said it could reach more than $2billion in annual originations by 2020.

He said that despite over 6,000 banks offering small business lending options in the US, online lending to small businesses has flourished.

Australians getting short-changed for financial advice, inquiry hears (Rueters) Rated: A

Australia’s four biggest retail banks and wealth manager AMP (AMP.AX) have paid hundreds of millions of dollars in compensation to customers for poor advice over the past decade, a major inquiry into the financial sector heard on Monday.

Financial advice came under scrutiny at the start of a fortnight of hearings by the Royal Commission into corporate wrongdoing and abuse of power by Australia’s financial sector, which could lead to greater regulation and criminal charges.

 

India

Namaste Credit raises 25 crore (Business Line) Rated: AAA

Namaste Credit, a digital marketplace and technology platform for SME loans, has raised about 25 crore ($3.8 million) in a Series A round from Nexus Venture Partners. It will use the money to expand to new markets, improve its technology and data analytics platform and scale the business. The company plans to increase its channel partner programme across India and expand its technology licensing partnerships with leading lenders globally.

Finzy gets 8.5-crore funding

Finzy, a peer-to-peer lending platform, has raised about 8.5 crore ($1.3 million) in a pre-Series A funding round from industry investors. It hopes to close a second round of fund raising in two months. The company will use the money to speed up growth by investing in technology, making the process leaner and faster, and in building the team. It will also use a large part of the money to expand across Tier-I cities.

 (VCCircle) Rated: A

Indian peer-to-peer (P2P) lending startups are considering a private blockchain to facilitate sharing of information as a risk-mitigation strategy, and to identify fraudulent loan applications.

5 Benefits of Online Peer-to-peer Lending That You Didn’t Know (Entrepreneur) Rated: B

 

  • Easier and Faster
  • Lower Eligibility Criteria
  • Lower Interest charges
  • No hidden fees and charges
  • No penalty for repaying your loan before stipulated time

 

Africa

Meet FINT, the FinTech Company that wants to change micro-lending in Nigeria (Nairametrics) Rated: AAA

The guys behind FINT

FINT.ng is run by a team of 4; Chiwete John-Njokanma is the company’s Chief Executive Officer, Nnamdi Okeke is the Chief Technology Officer, Eskor Toyo is the Chief Operating Officer while Reva Attah is Chief Strategy Officer.

Who is it for?

The only restriction so far is that everyone who uses the platform must have a bank account that is linked to a BVN.  Users can borrow anything between N60,000 and N2 million at rates as low as 8% for 3 – 12  months, which in Nigeria is remarkable because in the current environment, a loan from a formal financial institution with 20% interest would be a good deal.

Personal Loan Products – Are they useful for repaying credit or a bad debt? (The South Africa) Rated: A

If you’re one of these people you might be interested in Wonga’s new personal loans. The personal loan offers a repayment plan lasting up to 6 months, affording customers more flexibility through small monthly repayment instalments.

Asia

Robo-advisor seen as a step forward for investors (The Malaysian Reserve) Rated: A

The issuance of robo-advisory licences by the Securities Commission Malaysia (SC) would allow regulators to provide high quality and cheaper investment advice for customers.

Main Street Capital Sdn Bhd CEO Julian Ng said through a robo-advisory licence, regulators are able to reach out to wider ranges of investors where previously only wealthy clients could afford the investment advice.

Authors:

George Popescu
Allen Taylor