- Today’s main news: Consumer debt surpasses mortgage debt. Funding Circle, INTRUST Bank expand partnership. Revolut offers app store for business banking. VPC Specialty Lending hits record monthly returns.
- Today’s main analysis: Amazon’s big push into lending, and beyond.
- Today’s thought-provoking articles: The past and future of banking. Should income investors consider P2P lending? Banks can’t partner themselves into digital relevancy.
- Consumer debt surpasses mortgage debt. This is an interesting trend, and as companies like Affirm and Klarna grow an interest in instant financing, I see trend continuing.
- Funding Circle, INTRUST Bank expand partnership. This makes me wonder if Funding Circle’s long-term strategy is to expand these types of partnerships nationally, and if they do, will they take INTRUST with them or partner with other regional banks?
- Amazon’s push into lending, and beyond. As it stands now, I don’t see Amazon competing with most online lenders. Their niche is lending to small businesses that sell on the Amazon platform. Of course, that could change at any time.
- The past and future of banking. This is something every alternative lender should consider. How much of the P2P lending pie will banks ultimately have, and are we willing to give up any of our portion?
- Banks can’t partner themselves into digital relevancy. Do they have a choice?
- Marcus is not adding credit cards any time soon.
- Finn’s challenges.
- Sharestates launches new loan programs.
- Venmo launches a debit-card with MasterCard.
- PayPal acquires Simility.
- P2Binvestor raises $17 million.
- CrowdOut Capital surpasses $100 million in loans to middle market companies.
- Interview with James Gutierrez of Insikt. Lend Academy podcast.
- StraightUp merges with Slice.
- Fair Financial to go national.
- Most Americans will not pay for summer vacation with a loan.
- Depository Network offers decentralized network for P2P lenders.
- Invoice factoring edges out short-term borrowing competition.
- Wells Fargo revamps premium credit card.
- AFR expands technology offering.
- House passes telecom, utility payments bill.
- Revolut offers app store for business banking.
- VPC Specialty Lending sees monthly returns record. Congratulations.
- Should income investors consider P2p lending?
- Brokers frustrated with lenders changing their minds.
- Robo-advice acceptance on the rise.
- A guide to liquid IFISAs.
- Global Debt Registry launches decentralized ledger for the loan market.
- Mobilum partners with EthicHub.
- China: Hui Ying lowers IPO deal size to $32 million.
- Europe: Raisin, Banco BNI Europa deepen partnership.
- Australia: Mortgage Choice partners with RateSetter.
- Australia: ING distribution head joins RateSetter.
- India: Faircent transactions go through escrow.
- Canada: Finastra to sell Collateral Management Corporation to Teranet.
- United States
- Consumer Debt Now Surpasses Mortgage Debt (Investopedia) Rated: AAA
- INTRUST Bank and Funding Circle expand partnership (PR Newswire) Rated: AAA
- Amazon and Their Push Into Fintech (Lend Academy) Rated: AAA
- The Banking Industry: Past and Future (The Motley Fool) Rated: AAA
- Marcus Is Not Adding Credit Cards Products … Yet (Bank Innovation) Rated: A
- The challenges for a new ‘bank’ with a famous parent (American Banker) Rated: A
- Sharestates Launches New Loan Programs (PR Newswire) Rated: A
- Venmo officially launches its own MasterCard-branded debit card (TechCrunch) Rated: A
- PayPal gets anti-fraud ability with $ 120m acquisition of Simility (Fintech Futures) Rated: A
- Crowd lending fintech raises more than $ 17M (American Banker) Rated: A
- CrowdOut Capital Surpasses $ 100 Million in Loans to Middle Market Companies to Fuel Growth (Business Wire) Rated: A
- James Gutierrez of Insikt (Lend Academy) Rated: A
- Banks can’t partner themselves into digital relevancy (American Banker) Rated: AAA
- StraightUp Announces Merger With Slice (PR Newswire) Rated: A
- Mobile app for underbanked looks to go national (American Banker) Rated: A
- Majority of Americans Won’t Use a Credit Card to Pay for This Summer’s Vacation (Herald Courier) Rated: A
- House passes bill allowing telecom, utility payments in credit scores (American Banker) Rated: B
- Depositing the Future (NullTX) Rated: A
- Invoice Factoring Edges Out Competition Among Short-Term Borrowing Options (PR Newswire) Rated: A
- AFR Announces Expanded Technology Offering (AFR Wholesale) Rated: B
- Wells Fargo revamps premium card to compete on rewards (Payments Source) Rated: B
- United Kingdom
- Revolut Now Offers an App Store for Business Banking (Crowdfund Insider) Rated: AAA
- VPC Specialty Lending sees record monthly returns (AltFi News) Rated: AAA
- Should Income Investors Consider P2P Lending? (Morningstar) Rated: AAA
- Majority of brokers’ biggest frustration is lenders changing their mind on a deal (Mortgage Introducer) Rated: A
- Acceptance of robo advice on the rise (Financial Reporter) Rated: A
- A guide to liquid IFISAs (Peer2Peer Finance) Rated: A
- Chinese online lending platform Hui Ying Financial lowers US IPO deal size to $ 32 million (Nasdaq) Rated: AAA
- European Union
- Raisin and Banco BNI Europa Deepen Collaboration (Crowdfund Insider) Rated: AAA
- Global Debt Registry Launches Decentralized Ledger for the Loan Market (Payment Week), Rated: A
- Mobilum Crypto Payment Processor Partners With EthicHub Crowdlending Platform (Bitcoin Exchange) Rated: B
- Mortgage Choice partners with P2P lender (The Adviser) Rated: AAA
- ING distribution boss joins RateSetter (Independent Financial Adviser) Rated: B
- All Financial Transactions on Faircent Conducted through Escrow Account (BW CI World) Rated: AAA
- Finastra to sell Canadian-based Collateral Management Corporation business to Teranet (Finastra) Rated: AAA
Consumer Debt Now Surpasses Mortgage Debt (Investopedia) Rated: AAA
Mortgages may represent the largest debt for households, but as a percentage of disposable income, home loans are comprising less of a liability, LendingTree found.
In a research report, the online lender, which analyzed data from the Federal Reserve, said that mortgage-related household debt has declined 5.5%, while consumer credit, which includes revolving credit and installment loans, jumped 45%. Of that, 42% was student loan debt. What’s more, LendingTree found that American household debt is on track to hit $1 trillion above the 2008 peak by the end of June. The debt figure has been increasing at a 3.4% annual rate and includes mortgage debt.
By the end of the second quarter, LendingTree is forecasting total mortgage and consumer debt to reach $15.7 trillion compared with $14.7 trillion 10 years ago.
INTRUST Bank and Funding Circle expand partnership (PR Newswire) Rated: AAA
Funding Circle, the small business loans platform, and INTRUST Bank, a leading US regional bank headquartered in Kansas, today announced the next phase of their strategic partnership to support the growth of US small businesses. Following the successful launch of this partnership earlier this year, the second phase increases INTRUST’s funding commitment and kicks off a targeted, co-branded marketing campaign, giving business owners across Kansas, Missouri, Oklahoma, and Arkansas greater access to fast and flexible financing.
To date, over 150 American small businesses have received loans backed by INTRUST through the Funding Circle platform. The upsized commitment is anticipated to increase this number above 500.
Amazon and Their Push Into Fintech (Lend Academy) Rated: AAA
Last week CB Insights released this really interesting report titled, Everything You Need To Know About What Amazon Is Doing in Financial Services.
The report provides an in depth look at the moves Amazon has made in payments, lending, the new Amazon Cash program and also takes a look at how the company has been developing fintech programs internationally.
By the simple addition of a debit card, Amazon could move the unbanked into a quasi bank account that could be used at places beyond Amazon.
They have had a small business lending operation since 2011 and much fanfare was made about the $3 billion they have loaned through June 2017. But that doesn’t even put them in the top three online small business lenders in that time period. OnDeck, Kabbage and CAN Capital all loaned more.
To be fair Amazon is not trying to be a general purpose lender. Their SMB lending operation is targeted solely at Amazon marketplace sellers as a way to help them grow their business so they will sell more products on Amazon. It is not clear they have a desire to do more than that.
The Banking Industry: Past and Future (The Motley Fool) Rated: AAA
One of the big things that’s happened over the past 25 years is that the big banks have gotten bigger. We now have what are known as the Big Four banks in the U.S. — Citigroup, Bank of America, Wells Fargo and JPMorgan Chase. All of those have grown substantially through acquisitions, not just from the financial crisis, which saw a lot of consolidation, but beforehand. Actually, three of the four were actually acquired themselves, and the acquiring companies just decided to keep the names because they were more recognizable.
Douglass: I believe that peer-to-peer lending will represent at least 25% of total lending spent in 25 years. Now, I only say 25%. For me, it’s very clear that peer-to-peer lending has become a lot more widespread and a lot more feasible than it was previously. I do expect the peer-to-peer lenders — or a bank, perhaps, who hops in — to help solve for one of the current difficulties, which essentially is poor underwriting by some of the peer-to-peer facilitators right now, meaning that the investors who are putting the money in aren’t making the kind of money that they’d hoped to — I believe those will ultimately be solved.
But, I only say 25% because banks have legitimately trillions of dollars to lend, and they will absolutely be looking for ways to deploy that capital effectively. So, I would expect that they will be helping facilitate a lot of these peer-to-peer loans. I believe they will be, in some cases, investing alongside. I think they will often invest in alone, and perhaps then sell it to peer-to-peer lenders for an arbitrage so that they can do it all again, sort of like you see with agency-backed mortgages.
Marcus Is Not Adding Credit Cards Products … Yet (Bank Innovation) Rated: A
The challenges for a new ‘bank’ with a famous parent (American Banker) Rated: A
When JPMorgan Chase set out to make its digital-only brand Finn, it quickly rejected the idea of using it to lure millennial customers over to the institutional side of the bank.
Finn has also found that for the 27 states where JPMorgan Chase is part of a shared ATM network but has no ATMs or branches of its own, customers have difficulty depositing cash. While those same customers can still withdraw cash and often don’t carry money with them, customers that work for tips have a hard time keeping Finn as their main banking account.
Sharestates Launches New Loan Programs (PR Newswire) Rated: A
Sharestates announced the launch of a Long-Term Portfolio Loan Program to facilitate the needs of borrowers throughout the life cycle of their real estate projects.
Some highlights of the Long-Term Portfolio Loan Program include 30 and 40-year mortgage terms, interest rates ranging from 5.99 to 7.5%, loans with a 10-year interest only period, followed by 20 or 30 years of amortization, as well as the ability to cover three or more properties under a single loan.
Venmo officially launches its own MasterCard-branded debit card (TechCrunch) Rated: A
Venmo today is officially introducing its own debit card in partnership with MasterCard, following beta tests of a Visa-branded debit card last year. The new card will allow Venmo users to pay anywhere MasterCard is accepted in the U.S., and will record transactions to the user’s Venmo account for easy splitting with friends. It can also be used at an ATM to withdraw funds from the Venmo’s account’s balance.
Unlike the beta version of the card, the MasterCard-branded Venmo card can be used to withdraw up to $400 per day at ATMs displaying the MasterCard, Cirrus, PULSE, or MoneyPass acceptance marks. No fees apply for U.S. MoneyPass ATMs, while the others will charge a $2.50 ATM domestic withdrawal fee.
There are no fees for using the card for purchases, even if you get cash back at the point of sale. However, if a signature is required to get cash back at a bank, you’ll pay a $3.00 Over the Counter Domestic Withdrawal Fee, the company says.
PayPal gets anti-fraud ability with $ 120m acquisition of Simility (Fintech Futures) Rated: A
Following on from its $400 million purchase of Hyperwallet on 20 June, it has now acquired fraud prevention and risk management platform Simility for $120 million.
Following the close of the deal, merchants on the PayPal platform will gain access to fraud tools that can be customised through their existing account management dashboard.
Crowd lending fintech raises more than $ 17M (American Banker) Rated: A
The crowd lending startup P2Binvestor has secured more than $17 million in funding from more than 20 participants to expand its bank partnership program, the company announced Thursday.
CrowdOut Capital Surpasses $ 100 Million in Loans to Middle Market Companies to Fuel Growth (Business Wire) Rated: A
CrowdOut Capital, the first tech-enabled online marketplace to fund corporate loans for middle market companies, announced it funded more than $112 million in loans in less than two years. Accredited investors choose from the company’s vetted loan offerings on a deal-by-deal basis.
CrowdOut funds loans as small as $3 million to companies with annual revenues between $10 – $500 million to fuel growth.
James Gutierrez of Insikt (Lend Academy) Rated: A
My next guest on the Lend Academy Podcast has spent his career doing just that. James Gutierrez is the CEO and Founder of Insikt. Since I last had James on the show a lot has changed but their mission is still to improve the financial health of the underserved consumer.
Banks can’t partner themselves into digital relevancy (American Banker) Rated: AAA
For banks, these partnerships won’t generate the quantum leap they need to move beyond a decades-old, product-centric mentality to deliver next-generation financial services that consumers deserve. At best, financial institutions may gain a workable solution that squats awkwardly in the existing infrastructure and brand. At worst, after a lot of time and effort — and increasing their infrastructure costs — banks will fail to deliver any noticeable difference to customers beyond a flurry of press releases.
StraightUp Announces Merger With Slice (PR Newswire) Rated: A
StraightUp, an innovative real estate-focused platform giving investors access to previously unavailable development opportunities, announced today a merger with Slice, the first blockchain-based REIT for investors around the world.
StraightUp was designed to democratize access to previously unattainable high-potential investment opportunities in New York City. As a result of merging with Slice, the new and improved platform will give international investors access to premium equity opportunities in desirable cities across the country, including New York City, Los Angeles and San Francisco.
Mobile app for underbanked looks to go national (American Banker) Rated: A
You could easily mistake Anne Leland Clark, a Twin Cities nonprofit executive, for a banker with with big, national ambitions as she discusses her organization’s digital platform for the underbanked.
The product, known as Fair Financial, launched in a pilot program this week to serve about 500 local customers over the next 18 months.
Majority of Americans Won’t Use a Credit Card to Pay for This Summer’s Vacation (Herald Courier) Rated: A
The survey of over 1,000 U.S. respondents, conducted by Affirm, found that Americans typically take their biggest vacations of the year over the summer, and cost is a major factor when planning travel.
55 percent of Americans said it’s very important to have the cost of the vacation paid off before going. The cost of a trip can linger even after the vacation is over: 32 percent of people said they regretted taking a vacation altogether.
House passes bill allowing telecom, utility payments in credit scores (American Banker) Rated: B
The legislation, authored by Rep. Keith Ellison, D-Minn., is aimed at helping consumers, those in particularly lower-income and minority households, build their credit histories.
Under the bill, information about a consumer’s utility or telecommunications service may be reported only to the extent that the information relates to payment by the consumer for such service.
Depositing the Future (NullTX) Rated: A
What differentiates Depository Network from both of those companies/platforms is the fact that Depository Network is actually not a lending platform. Rather, it is a depository infrastructure that other P2P lending platforms, banks and credit institutions can utilize. Depository Network is the world’s first fully decentralized multi-platform collateral network that connects traditional lending and blockchain technology.
Invoice Factoring Edges Out Competition Among Short-Term Borrowing Options (PR Newswire) Rated: A
When a business needs to raise capital, the more short-term the borrowing options, the better. For every option, though, business owners must weigh the increased cash flow against the trade-off. Interstate Capital looked at a breakdown of options – from bank loans to savings – invoice factoring comes out on top.
AFR Announces Expanded Technology Offering (AFR Wholesale) Rated: B
American Financial Resources, Inc. (AFR) announces that it has completed a pilot and will now be providing its broker network with notification when a house for which AFR owns the servicing is listed for sale. This will enable AFR’s broker partners an opportunity to reconnect with the homeowner and, ideally, assist with their next mortgage, on both the relisted property as well as the borrower’s next home.
Wells Fargo revamps premium card to compete on rewards (Payments Source) Rated: B
Two years after JPMorgan Chase & Co. launched an arms race in credit-card rewards with its Sapphire Reserve card, Wells Fargo will now offer three points per dollar spent on dining, travel and streaming services such as Netflix on its Propel card. Other purchases will earn one point per dollar, and points are redeemable at one cent per point.
Revolut Now Offers an App Store for Business Banking (Crowdfund Insider) Rated: AAA
Revolut, a digital only bank that says it is signing up over 120 businesses per day, has launched a new services for their business customers – Revolut Connect. This new feature is described as an “App store” for businesses to help provide easier access to digital tools.
With more than 60,000 businesses uses their bank now, Revolut Connect is designed to help firms easily connect and build integrations for the most popular business apps, including accounting platforms like FreeAgent, communication tools like Slack, Apps to help with tax, payroll, expense management and more. Revolut adds that many more popular Apps are in the queue. Revolut wants to create a one stop mobile experience where businesses may manage all of their financial needs in a single mobile friendly application.
VPC Specialty Lending sees record monthly returns (AltFi News) Rated: AAA
The £289m VPC Specialty Lending investment trust has recorded its highest monthly return to date for May 2018, according to stock market filings.
Its net asset value [NAV] total return for the month of May, the latest numbers released by VPC, was 1.03 per cent for the month. Returns comprised 0.94 per cent of income gains and 0.09 per cent of capital gains.
Should Income Investors Consider P2P Lending? (Morningstar) Rated: AAA
Peer-to-peer investment trusts now have around £1 billion of assets under management between them, but the jury is still out on whether or not they are worth backing.
P2P trusts launched four years ago as direct peer-to-peer lenders including Zopa and Funding Circle were fast gaining traction. The trusts promised exposure to hundreds, or even thousands, of different peer-to-peer loans, in return for a juicy dividend yield.
Majority of brokers’ biggest frustration is lenders changing their mind on a deal (Mortgage Introducer) Rated: A
Over half (56%) of brokers said the lenders changing their mind on a deal frustrates them the most about the specialist finance market, LendInvest found from surveying brokers at the NACFB Commercial Finance Expo in Birmingham.
A quarter (24%) identified the lack of good service as their main frustration. Rates not being good enough was an issue for 14% of those surveyed, while only 6% of those surveyed cited lack of choice as their biggest frustration.
Acceptance of robo advice on the rise (Financial Reporter) Rated: A
According to a recent poll carried out at the Intelliflo Change the Game conferences held in Manchester and London, robo-advice is now regarded as less of a threat to business for advisers than it has been in recent years.
Last year, both options gained equal top share in the poll (37% each of 315 respondents), while this year,’ robo-advice’ dropped to 25.5% (419 respondents), with ‘large product providers going direct’ down slightly but still the top concern at 32.5%.
A guide to liquid IFISAs (Peer2Peer Finance) Rated: A
But the rising popularity of the secondary market and ‘instant access’ accounts have created enhanced liquidity for P2P investors. On an array of platforms, lenders can sign up for long-term loans before selling their stake to others, while some of the bigger platforms allow free or low-fee withdrawals.
We’ve put together a guide to all the platforms offering IFISAs with extra liquidity…
- Assetz Capital
- Funding Circle
- HNW Lending
- Lending Works
Chinese online lending platform Hui Ying Financial lowers US IPO deal size to $ 32 million (Nasdaq) Rated: AAA
Hui Ying Financial Holdings, which operates an online peer-to-peer lending platform in China, lowered the proposed deal size for its upcoming IPO on Tuesday.
The Shanghai, China-based company now plans to raise $32 million by offering 5.6 million shares at a price of $5.85. The company had previously filed to offer 6.8 million shares at the same price. Hui Ying Financial Holdings will raise -19% less in proceeds than previously anticipated and command a market value of $436 million. Shares are currently listed on the OTCQB under the symbol SFHD.
Raisin and Banco BNI Europa Deepen Collaboration (Crowdfund Insider) Rated: AAA
Fintechs Banco BNI Europa and Raisin have furthered the collaboration between the two firms. Banco BNI Europe says it has entered into a cooperation to allow Portuguese savers to gain access to the best savings rates available from across Europe.
Global Debt Registry Launches Decentralized Ledger for the Loan Market (Payment Week), Rated: A
Global Debt Registry (“GDR”)today announced the launch of its loan registry designed to verify and provide transparency on loan data on the cloud-based IBM Blockchain Platform. All loan level collateral positions and verification activity will now be immutably recorded on the decentralized registry with highly secure permissioning and access controls to provide new levels of efficiency to the $400bn asset backed securities (ABS) market.
Mobilum Crypto Payment Processor Partners With EthicHub Crowdlending Platform (Bitcoin Exchange) Rated: B
Mobilum is a cryptocurrency enabled payment processing platform which allows for cryptocurrency payments in real time at points of sale via an already existing debit or credit cards of the customer and the issuer of the Mobilum token. Mobilum recently announced its partnership with EthicHub, an affiliation that is expected to bolster a mutual sharing of investment opportunities for users on both platforms.
EthicHub’s crowd lending projects have provided financial solutions for small projects especially those involving farmers in less economically disadvantaged parts of the world, an accomplishment for which it was awarded the Best financial inclusion project at LaBitConf in Bogota as well as the award of the “Start-up with the Greatest social impact” at Unconference Fintech Awards in Madrid, Spain.
Mortgage Choice partners with P2P lender (The Adviser) Rated: AAA
Mortgage Choice has announced that it has partnered with RateSetter in a move that would provide its 600 brokers with access to personal loans and green loans offered by the P2P lender.
RateSetter CEO Daniel Foggo claimed that the partnership was part of the lender’s plan to develop its broker relationships.
ING distribution boss joins RateSetter (Independent Financial Adviser) Rated: B
ING’s former head of third-party distribution, who led relationships with financial advice and mortgage broking networks, has left to join fintech peer-to-peer lender RateSetter.
All Financial Transactions on Faircent Conducted through Escrow Account (BW CI World) Rated: AAA
Faircent.com was the first platform in India to meet all guidelines prescribed by RBI and receive the NBFC-P2P certification in May, this year. This is a validation of the business model that we have painstakingly built over the last five years.
All financial transactions on our platform are undertaken through an escrow account under the trusteeship of ITSL (an IDBI Trusteeship Services Ltd). Borrowers are evaluated by our fully-automated credit evaluation mechanism across more than 400 data points to understand their ability, stability and intent to repay before they are listed on the platform.
Finastra to sell Canadian-based Collateral Management Corporation business to Teranet (Finastra) Rated: AAA
Finastra today announced that it has entered a definitive agreement to sell its Canadian-based Collateral Management Corporation (CMS) business to Teranet. The transaction is expected to close in July 2018, subject to required regulatory approvals and customary closing conditions.
CMS will join Teranet as a new complementary line of business. Jointly, they will deliver enhanced, integrated solutions to a broad set of financial services customers, leveraging investments in technology, rich insightful data, and market leading electronic registry and workflow platforms.