- Today’s main news: UK P2PFA publishes Q4 data. Trended data better at assessing auto loan risk.
- Today’s main analysis: Millennials find apps better for personal finance than dating.
- Today’s thought-provoking articles: Student-loan startup raises money from Suber. SoFi expands mortgage line into Australia. Rupaiya Exchange to disburse Rs 100 cr loan.
- Millennials use apps more for personal finance than dating. AT: “We’ve reported on SoFi’s study of generation differences regarding financial thinking before, but this comes at it a little differently. It’s interesting that millennials are more interested in financial advice and planning than Gen Xers. It’s also interesting they’d rather use mobile apps for finance than dating.”
- Trended data better at assessing auto loan risk. AT: “Equifax is introducing an interesting way to analyze risk for auto loans.”
- Student-loan startup raises money from Prosper’s Suber. AT: “Not surprising. Startups often approach pioneers for advice and support. If Suber put something into Credible, it’s because he sees value.”
- Sharestates tops $275M in real estate investment. AT: “Sharestates is quickly becoming one of the leading RECF platforms. I expect more great things from them. Disclosure: I do write for Sharestates, but you can make up your own mind.”
- BorrowersFirst secures another $100M in funding. AT: “Congratulations.”
- Lawyer regrets using SoFi to refinance student loan. AT: “When I read a story like this, I think there must be something more to it. It’s often a he said-they said scenario. Perhaps the lawyer just didn’t do his due diligence. It’s interesting, nonetheless.”
- Lending Club schedules Q4 earning release for Valentine’s Day. AT: “Irony or a carefully crafted sign?”
- PayPal names Airbnb exec to board.
- P2PFA publishes Q4 data, and it’s awesome. AT: “It doesn’t look to me like Brexit is having much impact on P2P lending in the UK. It’s still growing.”
- Funding Circle dominates P2P lending. AT: “Same story, different emphasis.”
- Financial innovation is a lifeline for SME financing.
- United States
- MILLENNIALS FIND APPS MORE HELPFUL FOR PERSONAL FINANCE THAN DATING (SoFi), Rated: AAA
- Trended data better at assessing auto loan risk, analysis shows (Automotive News), Rated: AAA
- Student-Loan Startup Raises Money from Prosper’s Suber, Others (Bloomberg), Rated: A
- Sharestates Tops $ 275 Million in Real Estate Investment (Crowdfund Insider), Rated: A
- BorrowersFirst® Secures Additional $ 100 Million in Funding (Yahoo! Finance), Rated: A
- This lawyer refinanced his student debt with a fintech start-up and deeply regrets it (CNBC), Rated: A
- Lending Club Schedules Q4 Earnings Release for February 14th (Crowdfund Insider), Rated: B
- PayPal Names Airbnb Executive To Its Board (PYMNTS), Rated: B
- United Kingdom
- UK P2PFA Publishes Q4 Data (Crowdfund Insider), Rated: AAA
- Funding Circle is dominating Britain’s peer-to-peer lending industry (Business Insider), Rated: A
- Financial innovation – a lifeline for SME funding (Banking Tech), Rated: A
- European Union
- Fintech gets its voice heard at Davos (P2P Finance News), Rated: A
- KfW mulls more P2P securitisations (P2P Finance News), Rated: A
- US fintech SoFi targets mortgage lending in Australia (Financial Review), Rated: AAA
- This P2P lending platform plans to disburse Rs 100 cr loan in a year (YourStory), Rated: A
MILLENNIALS FIND APPS MORE HELPFUL FOR PERSONAL FINANCE THAN DATING (SoFi), Rated: AAA
Personal finance can be frustrating. And your financial future can suffer without the right strategy.
That’s true for everyone, but it’s especially for millennial professionals ages 25 to 34 and Gen Xers ages 35 to 44. On top of having student loan debt and dealing with an ever-increasing cost of living, both groups have a tough time figuring out who to trust and what advice to take.
Gen Xers feel more empowered by money than other age groups
While only 18% of respondents say that thinking about their financial future makes them feel empowered, those ages 35 to 44 feel the most empowered. Perhaps that’s because as professionals rising in their careers, they’re thinking about what money will enable them to do.
For millennials, earning a higher salary is a financial priority
It’s been reported that millennials, on average, are willing to take a $7,600 pay cut in exchange for an improved quality of life/work. But our findings show something different: For these ambitious professionals, earning a higher salary is, indeed, a financial priority. While it’s true that millennials experience wage stagnation, there are a number of ways to change that.
25-34 year olds talk to parents and/or siblings more than any other group, and reach out to financial advisors only slightly more than 35-44 year olds.
But in comparison to other groups, 35-44 year old professionals do the least when it comes to structuring their long-term goals. Among all groups, those making more than $100,000 were the most likely to look at the big picture.
But with 38.4% of 25-34-year-olds indicating they were less than successful in accomplishing their priorities, that’s sure sign they could use more help in setting investment goals and creating good financial habits for reaching them.
While only 10.8% of 25-34-year-olds have used digital tools to actually achieve financial milestones, that’s still more than any other group.
Trended data better at assessing auto loan risk, analysis shows (Automotive News), Rated: AAA
Auto loan accounts could jump 11 percent a year if lenders use trended data, according to Equifax’s December 2016 Consumer Credit Impact analysis.
Especially in the automotive industry, Equifax expects more reliance on data insights as the market settles into a “post-recession norm,” a company statement said. “It will be vital to leverage as many insights about consumer debt behavior as possible to more confidently assess risk for a stable portfolio performance in support of a healthy loan marketplace.”
Equifax began using trended data for mortgage underwriting in September. It’s currently testing a specially designed risk-assessment model for auto lending.
In Equifax’s auto loan overpay analysis, it found that 77 percent of consumers who overpaid in year one also overpaid in year two. For those who overpaid in year one but did not in year two, “that nuance is very important,” Maynard said.
Student-Loan Startup Raises Money from Prosper’s Suber, Others (Bloomberg), Rated: A
Credible, which offers an online exchange for student and personal loans, raised $10 million from investors including Ron Suber, the president of Prosper Marketplace Inc., and Regal Funds Management to expand its business of matching borrowers with lenders.
The Series B funding round was led by Regal, and included existing investor Carthona Capital, Credible founder and Chief Executive Officer Stephen Dashsaid this week in an interview. The firm’s Series A round was for $10 million and much of it is still in the bank, Dash said.
Credible closed its Series A in 2015 in a fundraising led by Soul Htite, founder and CEO of Dianrong.com and co-founder of LendingClub, according to TechCrunch. Suber also participated in that round.
Sharestates Tops $ 275 Million in Real Estate Investment (Crowdfund Insider), Rated: A
Sharestates, a real estate crowdfunding platform, has hit $275 million in loans since platform launch in 2015. The milestone makes Sharestates one of the largest online real estate investment platforms of its kind. Sharestates said the December 2016 was the most active month in the platform’s history originating more than $42 million in loans. Sharestates said that loan volume has nearly doubled in just three months.
As of December 30, 2016, Sharestates reported having returned more than $151 million to its investors with no loss of principal and yielded a net average annual return of 11% to investors.
BorrowersFirst® Secures Additional $ 100 Million in Funding (Yahoo! Finance), Rated: A
BorrowersFirst (), a national online consumer lending platform, announced today that it has secured an additional $100 million in debt financing to accelerate loan originations and fund continued growth of its balance sheet. With this new facility, BorrowersFirst has now secured an aggregate of $400 million in capital to support its profitable growth.
The additional $100 million senior debt commitment comes from Waterfall Asset Management, a SEC-registered specialist credit advisor focused on high yield asset backed security (ABS) and loan investments.
BorrowersFirst loans are originated by Cross River Bank (CRB), a leader in marketplace lending.
This lawyer refinanced his student debt with a fintech start-up and deeply regrets it (CNBC), Rated: A
After graduating from law school in 2009 with more than $250,000 in debt, Josh Garber refinanced $80,000 of his student loans with online personal finance startup SoFi, a decision he now sorely regrets.
The company, he said, offered a better interest rate than his other lender and a program that allowed him to defer payments if they were higher than a certain percentage of his income, similar to how federal loans work.
SoFi has since scrapped that loan program, and every three months its debt collectors come after him for repayments he cannot afford to make, he told CNBC.
SoFi disputed Garber’s description of the terms and details of the program and said he never produced proof of income.
“We’ve never offered an income-based repayment plan, but we can offer members forbearance for up to 12 months if they can show us economic hardship. So incorrect to say we took away a program,” a spokesman for SoFi told CNBC.
Lending Club Schedules Q4 Earnings Release for February 14th (Crowdfund Insider), Rated: B
Lending Club (NYSE: LC), the leading US marketplace lending platform, will issue its Q4 earnings report on Tuesday, February 14, 2017, after market close. Lending Club will host a conference call to discuss the fourth quarter financial results at 2:00 p.m. PT / 5:00 p.m. ET on the same day. The earnings report will be viewed as a benchmark measure on the marketplace lending industry.
A live webcast of the call will be available at under the Events & Presentations menu. To access the call, please dial +1 (888) 317-6003, or outside the U.S. +1 (412) 317-6061, with conference ID 2560900, ten minutes prior to 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time).
To access the confernece call, dial +1 (888) 317-6003, or outside the U.S. +1 (412) 317-6061, with conference ID 2560900, ten minutes prior to 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time).
PayPal Names Airbnb Executive To Its Board (PYMNTS), Rated: B
PayPal announced Tuesday (Jan. 17) it has appointed Belinda Johnson, chief business affairs and legal officer at Airbnb, to its board of directors. Johnson will serve on the audit committee at PayPal. Her appointment, while disclosed Tuesday, was effective as of Jan. 12.
PayPal said the addition of Johnson to the board will increase the number of directors to 10.
UK P2PFA Publishes Q4 Data (Crowdfund Insider), Rated: AAA
During the final three months of 2016, more than £843,917,964 million of new lending was transacted through P2PFA member platforms, with a total of almost £3 billion lent during the year. The P2PFA pointed to strong growth in the number of investors and borrowers.
P2PFA members represent over 75% of UK p2p lending. Their eight member platforms include; Funding Circle, Landbay, Lending Works, LendInvest, Market Invoice, RateSetter, ThinCats and Zopa.
Funding Circle is dominating Britain’s peer-to-peer lending industry (Business Insider), Rated: A
Britain’s peer-to-peer lending industry enjoyed its best quarter of the year in the final three months of 2016, led by big volumes at Funding Circle.
The P2PFA figures point to a sustained recovery from jitters surrounding last year’s Brexit vote. Lending volumes declined between the first and second quarters of 2016 as uncertainty before and directly after the vote to leave the European Union put off investors.
The strong year-end for the sector was largely driven by Funding Circle, which accounted for £305.9 million of the £843.9 million lent in the third quarter, or 35% of all lending.
Financial innovation – a lifeline for SME funding (Banking Tech), Rated: A
The reluctance of banks to lend to businesses in the wake of the financial crisis kickstarted massive innovation in business finance. In particular, peer-to-peer (P2P) lending is often seen as the poster child of innovation in the finance sector, with Zopa, Funding Circle and RateSetter being some of the largest and most well-known P2P lenders.
Yet, focusing only on P2P misses a huge part of the story of how funding in Britain is changing.
Fintech gets its voice heard at Davos (P2P Finance News), Rated: A
THE WORLD Economic Forum may be the go-to place for political leaders to rub shoulders but fintech trade body Innovate Finance is making sure its bustling sector gets heard in Davos.
The organisation has taken a delegation including peer-to-peer lender Zopa and other technology companies such as Bankable, Bitfury, Deposit Solutions, iwoca, Scalable Capitaland Yoyo Wallet, to the annual meeting in Switzerland this week.
KfW mulls more P2P securitisations (P2P Finance News), Rated: A
KFW, the German state-backed bank that last year invested in Funding Circle’s £129m securitisation, is open to more deals in the peer-to-peer finance sector in 2017.
The development bank bought £44m of the most senior tranche of business loans, which were owned by US asset manager KLS and originated through Funding Circle’s platform.
Last month, KfW said it plans to commit €1.3bn (£1.1bn) to SME securitisation deals in 2017, including up to €500m for transactions from European countries outside of Germany.
US fintech SoFi targets mortgage lending in Australia (Financial Review), Rated: AAA
One of the best-funded financial technology companies in the US, SoFi, is preparing to launch in Australia to offer mortgages in direct competition with the banks.
In recent days, the San Francisco-based SoFi has used LinkedIn to advertise for a manager of mortgage operations, based in Sydney, along with an operations manager and a marketing manager.
The pending opening in Sydney would be SoFi’s first office outside the US, where it has funded more than $US14 billion in student loan refinancing, personal loans and mortgages since it was founded in 2011. Over the past two years, SoFi, which used to be called Social Finance, has raised $1 billion in new equity funding and grown staff numbers from 200 to 700.
This P2P lending platform plans to disburse Rs 100 cr loan in a year (YourStory), Rated: A
Globally, shared economy and funds is a strong concept. It was something that 34-year-old Rohan Hazrati, who was associated as the CFO of a German company, noticed. He had seen people investing and borrowing via peer to peer lending. It was his eureka moment, he realised that there was a need for a more simple and easier lending process in India. That is when he thought of starting Rupaiya Exchange, a P2P (peer-to-peer) lending platform.
Over the past two years, the focus on lending space is fast increasing. In the P2P lending space, there is the Mohandas Pai-backed Faircent, which is a significantly large player in the space, i2ifunding, and IndiaLends.
The team charges a percentage on the loan funded, as success fees. The team has raised an angel round of $200,000 from a group of HNIs and professionals.