- Today’s main news: Cross River Bank, PeerIQ partner on loan data.Coinbase to offer crypto payments service to compete with PayPal.Better Mortgage hits $1B in mortgage loan funding.LendingClub updates Truth in Lending Statement.Zopa to launch a credit card.Funding Circle plans IPO at $2.1B valuation.Prospa ranked #1 among high-growth firms in APAC.
- Today’s main analysis: Why banks should buy online lenders.
- Today’s thought-provoking articles: Bill seeks to outlaw pricey personal loans in California.China gets pushback on new lending rules.Millennial SME owners prefer alternative lenders.
- Cross River Bank, PeerIQ partner on loan data. AT: “An excellent partnership.”
- Coinbase to compete with PayPal with crypto payments service. AT: “The time has come for cryptocurrencies to have their own global payments megafirm. Could that be Coinbase? They’re as likely a candidate as any, and poised for greater growth.”
- Millennial SME owners prefer online lenders. AT: “I think it’s pretty well established across the board that millennials prefer alternative lenders. This study breaks it down to SME owners, specifically.”
- P2P lending soars while SMEs are wary of finance.
- Better Mortgage hits $1B in mortgage loan funding. AT: “Congratulations! Better Mortgage is one of the leading companies transforming the mortgage industry with technology.”
- Why banks should buy online lenders. AT: “A must-read analysis from PeerIQ. There’s more to it, however, than mere numbers. As financial technology rises, if banks do not find a way to make use of technology to remain competitive, they will become obsolete. That’s why they need a presence at the table.”
- LendingClub updates Truth in Lending statement.
- Will LendingClub turn the corner in 2018?
- Pricey personal loans could be outlawed in California. AT: “The attack on high-interest small-dollar loans is taking place simultaneously at the state level and the federal level.”
- BFS Capital has a new $175M credit line.
- Braviant Holdings to raise $7M in equity.
- VPC’s portfolio sales drag.
- PeerStreet review.
- How real estate investing benefits from technology.
- Podcast interview with Marla Blow of FS Card.
- BBVA, Azlo partner on freelance market.
- Goldman Sachs hones in on consumer banking.
- Banks urged to compete with payday lenders on small-dollar, lower-cost loans.
- Big banks are fine with Dodd-Frank.
- Entrepreneur launches mobile tax refund loan app.
- Roostify gets another investor.
- French asset manager signs deal in meatpacking.
- House bill on MPL passes.
- Zopa beefs up employee base for credit card launch. AT: “Zopa has always been a leader in marketplace lending. Does this spell a new age of credit for the industry? Will we see a day when all alt lenders issue credit cards?”
- Funding Circle IPO will value lender at $2.1B.
- Funding Circle to hire Morgan Stanley to lead float.
- Lendy reports 224% turnover increase.
- Lending Works to use Credit Kudos to power open banking.
- Small businesses use specialist lenders.
- The best time to seek alt finance is now.
- ArchOver prepares for IFISA launch.
- Crowdfunding comes of age.
- Time to get clear on IFISA.
- P2P lending is 13 years old now.
- Wonga purchases Credito Pocket.
- BinckBank, Raisin partner in Dutch market.
- Augmentum to raise 100M GBP.
- ING Diba buys Lendico.
- IdentityMind Global raises $10M.
- P2P lenders shake off cryptocurrency volatility.
- FintruX to close whitelist in 11 days.
- Gluwa, Aella Credit partner to launch Creditcoin.
- GISC LoanCoin Network.
- iP2PGlobal launches pre-ICO sale.
- Prospa ranks #1 among high-growth firms in APAC.
- Nimble Money up for sale.
- Loans.com.au slashes variable rates for home buyers.
- BaptistCare loans over $11.5M.
- Lendit tops W100b in loan volume.
- Magma Partners invests in Portal Finance.
- Talad offers SME loans based on invoices.
- Finda envisions online financial marketplace.
- United States
- Fintech-friendly Cross River Bank partners with PeerIQ on loan data (American Banker), Rated: AAA
- Coinbase Now Powering Payments in Digital Currency (Crowdfund Insider), Rated: AAA
- Millennials SME Owners Prefer Online Alternative Lenders to Tradtional Ones (Bank Innovation), Rated: AAA
- P2P lending soars but SMEs generally wary of finance (P2P Finance News), Rated: A
- Better Mortgage Hits $ 1 Billion Dollars in Mortgage Loans Funded after Launch in January 2016 (BusinessWire), Rated: AAA
- The Case for M&A (Why Banks Should Buy Online Lenders) (PeerIQ), Rated: AAA
- Update to Truth in Lending Disclosure Statement (Lending Club), Rated: AAA
- Will LendingClub Turn a Corner in 2018? (Guru Focus), Rated: A
- Pricey personal loans would be outlawed by bill that would reshape state lending industry (Los Angeles Times), Rated: AAA
- BFS Capital Announces New $175 Million Credit Line (BFS Capital Email), Rated: A
- Braviant Holdings Announces $ 7 Million Equity Raise (Braviant Email), Rated: A
- VPC’s portfolio sales drag on performance (P2P Finance News), Rated: A
- PeerStreet Review (Benzinga), Rated: A
- Marla Blow of FS Card (Lend Academy), Rated: A
- How does real estate investing benefit from technology (Realty Biz), Rated: A
- BBVA taps digital start-up Azlo to target US freelance market (Fintech Futures), Rated: A
- Goldman Sachs and rivals home in on risky consumer banking (Financial Times), Rated: A
- Banks Urged to Take On Payday Lenders With Small, Lower-Cost Loans (WRAL), Rated: A
- B of A’s Moynihan: Big banks are ‘fine’ with Dodd-Frank (American Banker), Rated: A
- African-American Entrepreneur Launches Innovative Mobile Tax Refund Loan App to Revolutionize the Tax Industry (Black News), Rated: B
- Add Another Bank to Fintech Roostify’s Roster of Investors (Bank Innovation), Rated: B
- French asset manager signs record deal in the Meatpacking District (The Real Deal), Rated: B
- House bill passes that clarifies interest rates when contracts are sold by originating institution (SubPrime), Rated: A
- United Kingdom
- Zopa on hiring drive to support credit card launch in 2018 (P2P Finance News), Rated: AAA
- Temasek-backed Funding Circle plans IPO at $2.1b valuation (Deal Street Asia), Rated: AAA
- Funding Circle set to hire Morgan Stanley to lead London flotation (P2P Finance News), Rated: A
- Lendy reports 224% turnover increase (Bridging&Commercial), Rated: AAA
- Lending Works chooses Credit Kudos to power new Open Banking initiative (Finextra), Rated: A
- Small businesses look to specialist lenders for loans (Financial Times), Rated: A
- There’s never been a better time to seek alternative finance (Belfast Telegraph), Rated: A
- ArchOver readies for IFISA launch (P2P Finance News), Rated: A
- Crowdfunding Comes of Age (moneyexpert), Rated: A
- It’s time to get clear on the Innovative Finance ISA (moneyexpert), Rated: A
- The peer-to-peer lending industry celebrates its 13th birthday this year. Has it finally grown up? (Verdict), Rated: B
- China Gets Pushback on New Rules to Curb Lending Practices (WSJ), Rated: AAA
- European Union
- Online Lending Market Growth Continues With Spanish Purchase (Prague Post), Rated: AAA
- BinckBank and Raisin double up for Dutch savings market (Fintech Futures), Rated: A
- Augmentum Fintech to raise £100mln to cash in on Europe’s financial disruption (Proactive Investor), Rated: A
- ING Diba Buys Lendico (P2P Banking), Rated: A
- Digital Identity Pioneer IdentityMind Global Lands $ 10M (Coverager), Rated: AAA
- Coin-backed P2P platforms shrug off crypto volatility (P2P Finance News), Rated: A
- FintruX’s whitelist closes in 11 days (AMBCrypto), Rated: B
- Harnessing the Full Potential of the $ 600 Billion Crypto Network (NewsBTC), Rated: B
- GISC LoanCoin Network (NewsBTC), Rated: B
- iP2PGlobal Announces Its Pre-ICO Crowdsales For Its TWQ Token On Feb 19 (CoinTelegraph), Rated: B
- Australian Online Lender Prospa Ranks #1 in List of High Growth Firms in Asia Pacific (Crowdfund Insider), Rated: AAA
- Payday lender Nimble Money up for sale, bids due this week (Financial Review), Rated: A
- Loans.com.au slashes variable rates for home buyers (Canstar), Rated: B
- Over $ 11.5 million lent by payday loan alternative (finder), Rated: B
- Financial services execs invest in fin-tech startup Fincash (VC Circle), Rated: AAA
- Fintech startup Aye Finance raises Rs 25 cr from Vivriti Capital (Economic Times), Rated: B
- Lendit’s accumulated volume of loan tops W100b (The Korea Herald), Rated: AAA
- How VC Firm Magma Partners is Tapping Into the Untapped Chilean Fintech Market (Bank Innovation), Rated: A
- Talad platform offers SME loans based on invoice collateral (The Nation), Rated: B
- Finda envisions online financial marketplace (The Korea Herald), Rated: B
- Global Startups Boot Camp Coming To Rwanda (KTPress), Rated: A
- KiWi’s marketplace loans set for imminent Canadian debut (Financial Post), Rated: A
- Microfinancers warn Central Bank of return to 90s (Realnoe Vremya), Rated: A
Fintech-friendly Cross River Bank partners with PeerIQ on loan data (American Banker), Rated: AAA
Cross River Bank in Fort Lee, N.J., has entered into a partnership with PeerIQ, a provider of consumer loan data analytics, in an effort to streamline capital sourcing between online lenders and institutional loan buyers such as small banks.
Coinbase Now Powering Payments in Digital Currency (Crowdfund Insider), Rated: AAA
Coinbase, one of the largest cryptocurrency exchanges in the world, has launched Coinbbase Commerce, a payments platform that allows merchants to accept digital currency anywhere, anytime.
Millennials SME Owners Prefer Online Alternative Lenders to Tradtional Ones (Bank Innovation), Rated: AAA
According to Mercator’s report, Business Banking Services: Keeping Up with Millennial Owners, 27% of total U.S. SMEs have used online alternative lenders (P2P lenders or marketplace lending platforms) in 2017.
Of this number, 48% of millennial owners (aged 18–34), currently have a loan from an alternative lender compared to 25% of SMEs run by owners over 35 years of age. Further, these millennial owners said they are twice as likely to use alternative lenders than their older counterparts.
P2P lending soars but SMEs generally wary of finance (P2P Finance News), Rated: A
The 2018 Small Business Finance Markets report, released on Tuesday, found that P2P business lending rose by 51 per cent in 2017. In contrast, bank lending to UK small- and medium-sized enterprises (SMEs) fell to £700m in 2017 from £3bn the previous year.
Despite increased demand for alternative finance, the report found that 70 per cent of smaller businesses would rather forego growth than borrow. The BBB’s analysis found that only 1.7 per cent of small firms sought new loans over the last 10 quarters – a record low since its index began in 2011.
Less than half (43 per cent) of businesses surveyed were confident they would get a loan if they applied, even though most new loan applications (72 per cent) are approved.
Better Mortgage Hits $ 1 Billion Dollars in Mortgage Loans Funded after Launch in January 2016 (BusinessWire), Rated: AAA
Better Mortgage, a digital mortgage company focused on improving access to home financing for a new generation of homeowners, announced that it has funded over $1 billion dollars in mortgage loans to date. Better launched in January 2016, making it the third fastest online lender to reach this $1B milestone — per research published by Lend Academy in July 2017.
The Case for M&A (Why Banks Should Buy Online Lenders) (PeerIQ), Rated: AAA
Tech firms have already demonstrated they can open these markets. The largest money market fund in the world, Ant Financial’s four-year-old Yu’e Bao, was built on a sweep from the AliPay payments product. Intuit can utilize proprietary accounting and tax data to underwrite (and acquire) borrowers in novel ways. Amazon can underwrite small businesses using inventory turnover and reams of customer data.
“Big Tech” firms also have proprietary platforms and channels – in-home (think ‘Alexa’), apps, in-car, and mobile to name a few. However, in the US – at least for now – Big Tech firms lack a regulatory “swimlane” to compete with banks in lending and payments on a national scale. Their non-bank and commercial status confines their activities to narrow forms of lending, affinity partnerships, and lead generation. Until that impediment is dissolved, “Big Tech” firms need to partner with national banks with unsecured lending capabilities to fully unlock these markets.
Our argument is that banks without an unsecured lending capability risk losing long-term customer relevance. Banks that do not have an unsecured lending business do not have a seat at the table.
Which Banks are the logical buyers?
Banks that have the following characteristics would make a short-list of likely acquirers:
- Are active in lending, but have a gap in unsecured consumer loans
- Banks with asset management or structured products arms that can package loans into new products (e.g., ABS offerings, investment vehicles, etc.). Also, banks that have aspirations to develop a robo-advisor
- Banks that have a demonstrated history of partnering with FinTechs
We assume underwriting and loan terms similar to those today (e.g. ~700 credit score, 15% coupon, $15k principal, 3 to 5 year term). We assume annual charge-off rates of 5%. We assume a 1.5% deposit funding charge and a leverage ratio of 15%.
We find that a bank can generate 10% NIM, 2 to 3.5% ROA, 15 to 20% marginal-ROE during good times.
Update to Truth in Lending Disclosure Statement (Lending Club), Rated: AAA
As of Friday, February 23, 2018, recent updates made to the Truth in Lending disclosure statement for unsecured consumer loans will take effect. The forthcoming Truth in Lending disclosure statement is available here.
Will LendingClub Turn a Corner in 2018? (Guru Focus), Rated: A
LendingClub has a market cap of about $1.6 billion, which makes it one of the biggest players in the peer-to-peer lending market.
The company’s stock price has plunged nearly 40% over the last four months and this could continue unless the upcoming earnings call changes investor sentiment. LendingClub was valued at about $9 billion in late 2014 but it has dropped to about $1.6 billion.
Pricey personal loans would be outlawed by bill that would reshape state lending industry (Los Angeles Times), Rated: AAA
A bill introduced Thursday by Assemblyman Ash Kalra (D-San Jose) could dramatically reshape California’s lending industry by capping interest rates at roughly 20% for consumer loans between $2,500 and $10,000. Since rate caps were removed by the Legislature in the 1980s, there’s been no limit to the amount of interest lenders can charge on those loans.
That has led to startling growth in the market. In 2016, more than half of the loans between $2,500 and $5,000 and about 21% of larger loans charged interest rates of 100% or higher. In all, Californians in 2016 — the most recent year for which state data are available — borrowed $1.1 billion at triple-digit interest rates.
But Kalra’s bill would do much more than ban lenders’ priciest offerings. The bill would extend an existing set of rate caps that now apply to loans of less than $2,500 to all loans of up to $10,000. That would cap interest rates at roughly 19% for loans up to $10,000.
Had the caps been in effect in 2016, 98% of loans between $2,500 and $5,000 and 95% of loans up to $10,000 would have been outlawed. Only about $91 million of the $2.7 billion in loans made in those sizes in 2016 had rates below 20%.
BFS Capital Announces New 5 Million Credit Line (BFS Capital Email), Rated: A
BFS Capital, a leading small business financing platform, today announced it is has received a new $175 million revolving credit line provided by funds managed by Ares Management, L.P. BFS Capital will use the new facility to accelerate the growth of its lending business, following a record year where the company generated more than $300 million in originations, a new annual high.
Braviant Holdings Announces $ 7 Million Equity Raise (Braviant Email), Rated: A
Braviant Holdings, a leading fintech startup that uses advanced analytics and proprietary technology to make smarter lending decisions, has raised $5 million common equity from Loom Capital, LLC. Alongside the equity investment, Braviant has entered into an exclusive partnership with a subsidiary of Trend Capital, a tech-enabled digital marketing platform affiliated with Loom.
VPC’s portfolio sales drag on performance (P2P Finance News), Rated: A
VPC Specialty Lending Investments has reported a total net asset value (NAV) return of 3.07 per cent for 2017 – below its target return levels.
PeerStreet Review (Benzinga), Rated: A
In addition, “accredited investors” need only apply. Investors must have a net worth greater than $1 million in liquid assets (meaning the equity in your home doesn’t count) or you need to earn more than $200,000 per year or make $300,000 jointly.
PeerStreet’s minimum investment is $1,000 and account fees range from 0.25% to a 1% setup fee. The investment length ranges from six to 24 months.
Marla Blow of FS Card (Lend Academy), Rated: A
In this podcast you will learn:
- How Marla’s time at the CFPB indirectly led to the founding of FS Card.
- Why creating a new credit card company is so complicated and challenging.
- What their Build card is and who is their target market.
- How they are able to offer an secured credit card to people that banks reject.
- The types of data they use to find stable customers in the subprime segment.
- The typical size of the credit line they provide to these customers.
- The profile of their target customer and how they are using the credit card.
- How they are providing financial education to these people.
- How FS Card is acquiring these credit card customers.
- The percentage of their customers who have qualified for credit line increases.
- Why improving credit scores of their customers is a key metric.
- How they are able to issue these cards through their partner bank.
- How FS Card makes money.
- What regulators could be doing to help subprime consumers get more access to responsible credit.
- What more should fintech companies be doing to help these underserved people.
- The biggest challenges that FS Card has to overcome to become a large and successful credit card company.
How does real estate investing benefit from technology (Realty Biz), Rated: A
Buying and selling property has already become much more accessible due to technology, and this trend is only going to speed up. While historically, real estate professionals, investors, and landlords have been reluctant to pay for technology, and the data available has been spotty, the tide is turning as more wake up to the opportunities. Investment values are shooting up in many places due in a large part to technological advances, including the ability to market real estate to audiences beyond the immediate community and to close deals securely, quickly, and remotely with investors.
BBVA taps digital start-up Azlo to target US freelance market (Fintech Futures), Rated: A
BBVA has partnered with digital business account provider Azlo to target the freelance market in the US.
According to BBVA, by 2020 in the US alone, 43% of workers will be employed in freelance capacities – a trend that is expected to continue to grow.
Goldman Sachs and rivals home in on risky consumer banking (Financial Times), Rated: A
Lloyd Blankfein was a breezy opening act at a big industry event this week in Key Biscayne, Florida. On stage at the Ritz-Carlton the chairman and chief executive of Goldman Sachs was talking about Marcus, the bank’s new online savings and lending platform, which is targeting borrowers with scores as low as 660 on the 300-850 Fico scale. Goldman calls such people “creditworthy”; others call them subprime.
Banks Urged to Take On Payday Lenders With Small, Lower-Cost Loans (WRAL), Rated: A
Those who find themselves pinched for cash often turn to high-cost payday lenders. But traditional banks and credit unions could serve that role for borrowers and do it at much lower rates, according to a new proposal from the Pew Charitable Trusts.
B of A’s Moynihan: Big banks are ‘fine’ with Dodd-Frank (American Banker), Rated: A
While small and regional banks are pushing for a rollback of the Dodd-Frank Act, big banks are largely supportive of the 2010 financial reform law, Bank of America CEO Brian Moynihan said Thursday.
African-American Entrepreneur Launches Innovative Mobile Tax Refund Loan App to Revolutionize the Tax Industry (Black News), Rated: B
Good news for Americans struggling with income tax returns given the recent changes in the tax laws with the enactment of The PATH ACT. A visionary African-American entrepreneur, Marshawn Govan, has come up with an innovative mobile tax refund loan app that is all set to revolutionize the tax industry and make tax returns simpler for Americans.
Titled as MKG Tax Refund, the state of the art program is a patent pending mobile tax refund Collateral Driven Interest & Investment (SaaS) Software-as-a-Service (FOF) Fund-Of-Fund multi-manager investment application.
Add Another Bank to Fintech Roostify’s Roster of Investors (Bank Innovation), Rated: B
If there’s any question that digital mortgage firms are gaining attention from larger fintech players and investors, then look no further than venture capital firm Santander InnoVentures‘ investment in Roostify, a startup that digitalizes the mortgage application process.
French asset manager signs record deal in the Meatpacking District (The Real Deal), Rated: B
Tikehau Capital, a Paris-based firm with $15.6 billion in assets under management, signed a lease for the top two floors at Rockpoint Group’s new development at 412 West 15th Street, sources told The Real Deal.
The 11-year lease covers nearly 10,000 square feet on the top two floors of the 18-story building, which offer sweeping views of the Hudson River.
House bill passes that clarifies interest rates when contracts are sold by originating institution (SubPrime), Rated: A
Lawmakers highlighted that H.R. 3299 — the Protecting Consumers’ Access to Credit Act of 2017 — clarifies current law to ensure innovative marketplace lending remains in-tact while simultaneously providing safe consumer protections.
H.R. 3299 passed through the House by a vote of 245-171 and went on over to the Senate, which received it, read the measure twice and referred to the Committee on Banking, Housing and Urban Affairs.
Zopa on hiring drive to support credit card launch in 2018 (P2P Finance News), Rated: AAA
ZOPA is recruiting staff to develop its new credit card, which it plans to launch later this year as a feature of its digital bank.
Temasek-backed Funding Circle plans IPO at .1b valuation (Deal Street Asia), Rated: AAA
Funding Circle, the largest peer-to-peer (P2P) lender in the UK, is planning to list on the London Stock Exchange (LSE) that will see it float at an estimated valuation of £1.5 billion ($2.1 billion), according to a report by Britain’s Sky News.
Funding Circle set to hire Morgan Stanley to lead London flotation (P2P Finance News), Rated: A
FUNDING Circle is reportedly poised to hire Morgan Stanley to lead a flotation on the London Stock Exchange in the second half of this year.
The largest P2P platform by loan book size in the UK is expected to hire the US bank in the coming weeks, according to Sky News.
Lendy reports 224% turnover increase (Bridging&Commercial), Rated: AAA
Lendy has revealed a 224% turnover increase in 2016 (to £29.2m), compared with the previous year (2015: £9m).
The P2P lending platform has published its audited accounts for 2016, which also showed that profits before tax increased to £3.3m, compared with the £53,000 reported in 2015.
Lending Works chooses Credit Kudos to power new Open Banking initiative (Finextra), Rated: A
Credit Kudos, a challenger credit bureau, and Lending Works, a fast-growing peer-to-peer (P2P) lending platform, are partnering to enable customers to benefit from the UK’s Open Banking initiative, a secure way for banking customers to take control of their financial data. Credit Kudos and Lending Works’ partnership is one of the first initiatives to use Open Banking to improve customer experience in the finance industry.
Currently, approximately 60% of Lending Works’ borrowers are provided with instant and automated credit decisions, whereas the remaining 40% require some manual processes. Within the new world of Open Banking, Lending Works expects to increase that figure to up to 90% of credit decisions being fully automated.
Small businesses look to specialist lenders for loans (Financial Times), Rated: A
British small businesses are diversifying their sources of funding away from big banks, as a growing number turn to specialist asset-backed lenders, peer-to-peer finance sites, private equity and venture capital investors.
Fewer small businesses are applying for loans than in the past five years and more of them fear that if they did they would be rejected, according to the latest report into small business finance by the British Business Bank, a government-backed development bank.
Out of the UK’s total of 5.7m small businesses, only 1.7 per cent applied for a loan or overdraft last year, the fifth consecutive year of decline since 2012.
There’s never been a better time to seek alternative finance (Belfast Telegraph), Rated: A
There are also several privately funded lenders (with a local presence in the province through brokerages) such as Atom Bank, Relendex, Thin Cats and Dunluce Capital which have all completed a number of deals in Northern Ireland from cash flow loans to property development finance.
The Access to Finance initiative supported by Invest Northern Ireland offers a variety of support including start-up funding, loans and equity investment.
WhiteRock Capital Partners manages the £50m NI Growth Loan Fund (Access to Finance) which offers loans from £50k to £1.25m to local SMEs. With an extensive network of funding partners, we work hard to deliver the most appropriate support for local businesses.
ArchOver readies for IFISA launch (P2P Finance News), Rated: A
ARCHOVER is planning to launch its Innovative Finance ISA (IFISA) in the next few weeks.
Crowdfunding Comes of Age (moneyexpert), Rated: A
Crowdfunding is gaining serious traction in the UK market, with the sector pushing past the £10 billion milestone in 2016. While, most people will probably still associate the idea of ‘crowdfunding’ with websites like Kickstarter or early stage equity investments, the reality is that 97% of the market is debt-based – either P2P lending or Crowd Bonds.
Both P2P lending and Crowd Bonds are also making big strides into the mainstream thanks to their inclusion in the new(ish) Innovative Finance ISA (IFISA), which allows investors to earn interest tax free on their investments.
It’s time to get clear on the Innovative Finance ISA (moneyexpert), Rated: A
With the birth of the Lifetime ISA (LISA) for 18-39 year olds on 6 April 2017, the Innovative Finance ISA (IFISA) is no longer the baby of the ISA family. But it is perhaps still the least well understood.
The peer-to-peer lending industry celebrates its 13th birthday this year. Has it finally grown up? (Verdict), Rated: B
Whether that’s Paypal in the US or the start of the peer-to-peer lending industry (P2P) in the UK, financial services were changing long before the global recession hit.
The P2P industry is celebrating its 13thbirthday this year. With big changes afoot in its major players such as Zopa, as well as Funding Circle, what is next for P2P lending?
China Gets Pushback on New Rules to Curb Lending Practices (WSJ), Rated: AAA
Chinese regulators and commercial banks are butting heads over new rules Beijing is rolling out to tackle off-the-books lending that’s compounding China’s debt woes.
Particularly targeted are practices banks use to move loans off their books by repackaging them as investments. Banks transfer the loans—mostly corporate and local government borrowings—to brokerages and other types of shadow lenders, which then peddle the rebundled investments to investors. Such maneuvers accounted for $3.5 trillion in off-balance lending as of last year.
Online Lending Market Growth Continues With Spanish Purchase (Prague Post), Rated: AAA
Wonga’s latest acquisition is Spanish company Credito Pocket, who was a lending company based in Barcelona. This is aimed to boost the visibility of their Wonga.es domain.
BinckBank and Raisin double up for Dutch savings market (Fintech Futures), Rated: A
BinckBank says it will be the first in the Dutch banking sector to offer its clients access to European savings products via its cooperation with Raisin.
Augmentum Fintech to raise £100mln to cash in on Europe’s financial disruption (Proactive Investor), Rated: A
A new trust aimed at Europe’s fast-growing fintech sector is looking to raise £100mln ahead of a float in London.
Augmentum Fintech PLC said the financial services sector is ‘ripe for disruption and disintermediation’ but, unlike other sectors such as retail and travel, this has yet to happen.
ING Diba Buys Lendico (P2P Banking), Rated: A
Bank ING Diba acquires p2p lending marketplace Lendico. According to Finanz-Szene.de the transaction was reported to the German Federal Cartel Authority last week. The bank has confirmed the acquisition.
Digital Identity Pioneer IdentityMind Global Lands $ 10M (Coverager), Rated: AAA
IdentityMind Global, the leader in Digital Identities You Can Trust, today announced that it has closed a $10M Series C round of financing. In addition to all existing investors, the round was co-led by Benhamou Global Ventures and Eastern Link Capital and included Hanna Ventures, Overstock.com, and Zanadu Capital Partners.
Coin-backed P2P platforms shrug off crypto volatility (P2P Finance News), Rated: A
Digital currencies such as Bitcoin and Ethereum suffered from price falls in January but many firms are still seeing the benefits of creating their own cryptocurrency to use for P2P lending. One provider, SOFIN, is currently looking to raise up to $1m (£720,000) to create a token that can be used as a tool to bypass high exchange rates so loans can be funded internationally.
FintruX’s whitelist closes in 11 days (AMBCrypto), Rated: B
The global P2P lending ecosystem, FintruX backed by Ethereum and No-Code development has reopened the Token Sale, FTX which is used to power the FintruX network and is set-up as a mean to reward or get rewarded for participating in the marketplace. The token’s minimum per transaction at present is 0.1 ETH.
Harnessing the Full Potential of the $ 600 Billion Crypto Network (NewsBTC), Rated: B
These two companies plan to launch Creditcoin, which will operate across blockchains in the P2P lending market.
The Gluwa platform, to be powered by Creditcoin, will address the issues of accessibility of the crypto market by those in the fiat world by seamlessly connecting them with cryptocurrencies.
GISC LoanCoin Network (NewsBTC), Rated: B
GISC LoanCoin Network is a utility token based lending and borrowing platform that allows users to leverage their blockchain assets to secure cash loans. The network is optimal for P2P and B2B credit financing on a global scale.
iP2PGlobal Announces Its Pre-ICO Crowdsales For Its TWQ Token On Feb 19 (CoinTelegraph), Rated: B
The TWQ (Tawarruq) is an ERC20 token that confer the right to the token holder to submit an application for a personal financing based on a Commodity Tawarruq Trading program, through the iP2PGlobal platform and have it listed in the platform for prospective lenders to view and choose to finance.
10TWQs are needed to apply for a personal financing of up to 5ETH.
Australian Online Lender Prospa Ranks #1 in List of High Growth Firms in Asia Pacific (Crowdfund Insider), Rated: AAA
Prospa, a Sydney based online lender servicing the SME market, has received a nice recognition as it took the top spot for a high growth firm in Asia Pacific. According to a recent ranking of the top 1000 firms in Asia-Pacific by the FT, Prospa ranked number one having experienced revenue growth of 1600% during the time period of 2103 to 2016.
Payday lender Nimble Money up for sale, bids due this week (Financial Review), Rated: A
Privately owned personal loans company Nimble Money is on the block, with its two founders believed to be seeking an exit.
Street Talk can reveal Melbourne-based Baillieu Holst has been hired to find a buyer for the business and has been marketing the short term loans provider to financial services industry players and private equity firms in recent weeks.
Interested parties have been told Nimble Money is on track to make about $15 million in earnings this year, following significant growth in its loan book over the past 12-months.
It’s expected to be worth about $100 million.
Loans.com.au slashes variable rates for home buyers (Canstar), Rated: B
Online lender loans.com.au has cut interest rates on its variable rate home loan to just 3.52% (3.56%* comparison rate).
Comparatively, the next lowest variable home loan for owner-occpupiers at the time of writing sits at 3.54% (3.55%* comparison rate).
Over $ 11.5 million lent by payday loan alternative (finder), Rated: B
BaptistCare has approved 16 loans per week to some of Australia’s most financially vulnerable people.
The No Interest Loan Scheme (NILs), a microfinance program aimed at providing small no- and low-interest loans to financially vulnerable people, has this week announced it has surpassed $11.5 million lent in NSW. The loans are designed to help people on lower incomes purchase essential goods and services.
The loans are provided through BaptistCare with the scheme run under Good Shepherd Microfinance in partnership with NAB and the NSW Office of Fair Trading.
Financial services execs invest in fin-tech startup Fincash (VC Circle), Rated: AAA
Mumbai-based personal finance startup Fincash.com has raised Rs 1 crore ($150,000) in a fresh funding round from a group of angel investors from the financial services sector, a company statement said.
The startup will use this money to build its team, expand its product line, acquire customers and make its services available across more cities and towns, the statement added.
Fintech startup Aye Finance raises Rs 25 cr from Vivriti Capital (Economic Times), Rated: B
Fintech company focussed on the MSME sector Aye Finance has raised Rs 25 crore through a securitisation deal facilitated by Vivriti Capital.
Lendit’s accumulated volume of loan tops W100b (The Korea Herald), Rated: AAA
Lendit, a peer-to-peer lending platform operator in South Korea, has extended a combined 101.8 billion won ($95.4 million) in nearly 7,300 consumer loans as of Monday to midrange borrowers seeking lower interest rates, according to the fintech startup Monday.
How VC Firm Magma Partners is Tapping Into the Untapped Chilean Fintech Market (Bank Innovation), Rated: A
With government-backed initiatives and a finite business of copper export, Nathan Lustig, co-founder and managing partner at Magma Partners, saw huge potential in the Chilean fintech market.
Lustig points out that only 30% of Chileans have credit cards, while only 50% have bank accounts, “and that’s the more advanced population,” he said. Additionally, consumer experience is “pretty horrible for about 80% of this population,” he said.
One area within the fintech space that Magma has been particularly interested in is invoice-based lending, also known as factoring. In its portfolio is Portal Finance, a startup that provides SaaS for the factoring industry.
Portal Finance earns between 0.5% to 1% for every deal the bank accepts.
Talad platform offers SME loans based on invoice collateral (The Nation), Rated: B
Talad Invoice, a lending platform initiated by a fintech startup, is expected to grow at an exponential rate this year, following two years of peer-to-peer lending using invoices as loans collateral, said Watewiboon Pumipue, chief executive officer of D90 Capital Co, which operates the financial platform.
Finda envisions online financial marketplace (The Korea Herald), Rated: B
Finda operates an eponymous web portal that provides information about over 7,000 financial products — ranging from personal and mortgage loans, investment instruments, credit cards to insurance products — standardized in Finda‘s own format. Users can be offered easy-to-understand and up-to-date information about products online, she said.
Finda gathers information primarily from an open API by the Financial Supervisory Service, but since the FSS’ database provides data, including interest rates, of the previous months, Finda reflects updates directly from sellers — banks, insurers, credit card firms and peer-to-peer lending platforms.
Global Startups Boot Camp Coming To Rwanda (KTPress), Rated: A
Rwanda will next month host a continental Startup boot camp (SBC) that will source innovative and top startup talents in the country and across the globe.
SBC is a global family of industry-focused accelerators, which last year launched its first-ever Africa-based programme.
KiWi’s marketplace loans set for imminent Canadian debut (Financial Post), Rated: A
The next stage in the development of Canada’s first credit fund that invests in marketplace loans — unsecured consumer and small business loans provided by online lending companies — is set to play out over the next month.
The gang behind KiWi Private Credit Fund — formed last summer with $30 million of contributions from institutional and high-net-worth investors — is planning to meet the Canadian platforms.
Microfinancers warn Central Bank of return to 90s (Realnoe Vremya), Rated: A
The regulator has been fighting against expensive and very risky loans for several years already. Last July it tightened reserve requirements for MFO again: they must add 100% interest for payday loans with a delay of more than 90 days.
Firstly, the regulator is going to restrict the size of payday loans to 10,000 rubles, secondly, to reduce the biggest term of such loans to 15 days, thirdly, to reduce interest rates to 1,5% in 2018, to 1% in July 2019 a day. Now the largest payday loan is 45,000 rubles. The maximum term is 2 months, while extra payment on such loans is limited to a threefold size of a loan.
Payday loans account for 57,6% of all loans that MFOs granted in the second quarter of the last year.