Thursday April 11 2019, Weekly News Digest

china p2p lending

News Comments Today’s main news: Lending Club loans $159M in the past week. OnDeck offers same-day funding. Kabbage secures $700M in funding. RateSetter ISA passes 200M GBP in subscriptions. Funding Circle CEO pocketed 4M GBP last year. Klarna launches global customer authentication platform. Today’s main analysis: Drivers of global growth in FSB’s shadow banking. (A […]

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china p2p lending

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United States

United Kingdom

European Union

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United States

Need a loan for Tax Day? According to Lending Club data, you’re not aloan… er, alone (Thinknum), Rated: AAA

As seen in data from Lending Club ($NYSE:LC), there is a cyclical spike in the number of loans, as well as the money needed by those needing loans, right around the end of tax season. While this finding may seem pretty clear without any data, it essentially confirms an adage in the lending industry.

RIght now, there was only $21.5 million loaned out to lendees from April 8 to today. This past week, there was about $159 million worth of all sorts of loans — personal, mortgage, etc. — loaned out by the platform.

Lending Club Total Principal Loaned (Weekly)

ONDECK OFFERS SAME DAY FUNDING TO EMPOWER SMALL BUSINESS (OnDeck), Rated: AAA

OnDeck today announced that it will offer to fund and debit customer bank accounts with Same Day ACH transfers, eliminating a decades long pain point for small business owners accustomed to the traditional ACH transfer process, which can take multiple days and lacks certainty on when the transactions will hit bank accounts.

Same Day ACH transfers from OnDeck provide qualified OnDeck Term Loan and Line of Credit customers with funds up to the National Automated Clearing House Association (NACHA) cap of $25,000 by 5:00 pm local time on the same business day the customer books or makes a draw on their line of credit.* Qualified customers are also debited via the same day ACH service, providing them additional predictability in transaction clearing times and offering better clarity around day-to-day cash flow management.

Highlights from Jamie Dimon’s Annual Letter (PeerIQ), Rated: AAA

US payrolls rose by 196 k in March and the unemployment rate remained at 3.8%.

Source: Bloomberg, PeerIQ

Highlights from Jamie Dimon’s Letter to Shareholders

Jamie Dimon published his annual letter to shareholders. We look at some highlights below:

  • The banking system, and JPM in particular, is over-capitalized – Under the Fed’s most extreme stress-testing scenario, where 35 of the largest American banks bear extreme losses (as if each were the worst bank in the system), the combined losses are about 6% of the total loss absorbing resources of those 35 banks.
Source: JPM, PeerIQ

PM is investing billions in technology to compete – the cloud, AI, ML and digital banking

  • JPM customers can now open a bank account online in under 5 minutes and can reduce their mortgage closing times to 3 weeks.
  • The bank now has 49 Mn active digital customers, including 33 Mn active mobile customers
  • JPM is looking at fintechs in the US and in China as not just opportunities but also looming competition.

Online lender Kabbage rakes in 0m funding (Verdict), Rated: AAA

Kabbage, an online lender for small businesses, has fetched $700m in asset-backed securitisation (ABS) funding.

With the securitisation, the company’s debt funding increases to $940m.

Real-time data was Kabbage’s secret sauce, its first investor says (American Banker), Rated: A

The firm started life as a small, scrappy fintech startup in Atlanta in 2008, but has grown rapidly. It made $2 billion worth of loans in 2018 and more than $600 million in the first quarter of 2019. It also recently agreed to provide financing at the point of sale on Alibaba.com as part of a program called Pay Later.

Upstart Raises $ 50 Million and Announces New Bank Partners (Lend Academy), Rated: A

One of the big announcements on day one of LendIt Fintech USA 2019 is from consumer lender Upstart. They have announced a $50 million equity raise as well as three new partners for their “Powered by Upstart” banking as a service program. Oh, and they are getting into credit cards.

PeerStreet Lowers Minimum Real Estate Investment to $ 100 (Think Reality), Rated: A

The burgeoning peer-to-peer lending platform PeerStreet has unveiled product updates that enable investments of only $100.

The company recently announced it’s lowered the minimum investment to $100 for “small balance reinvestments” when using its automated investing product. The upgrade also expands the investment types available for automated investing to include cash offer loans and 30-day notes, which offer shorter terms than typical bridge loan investment options, the company said.

Sharestates Wins Top Real Estate Platform Award at LendIt Fintech USA 2019 (PR Newswire), Rated: A

Sharestates, a marketplace lending platform that connects real estate developers with investors, was crowned Top Real Estate Platform at LendIt Fintech USA2019 in San Francisco, California on April 9, 2019. The Top Real Estate Platform award is based on performance, volume, growth, product diversity, and responsiveness to stakeholders.

Now operating in 46 states, Sharestates offers diversified asset classes including residential, multi-family, mixed-use, commercial properties, and land acquisitions.

Since launching in 2015, Sharestates has closed on over $1.7 billion in total loan volume and returned over $675 million in principal to investors. Average annualized returns have exceeded 10% every year. As a result of its strong performance and valued relationships, 82% of Sharestates loan volume has come from repeat borrowers and 81% of its investors are repeat investors.

The stREITwise Platform Brings Real Estate Investment to All (Realty Biz News), Rated: B

The company has just announced a new acquisition to its investment portfolio, a $32 million mixed-use building in Carmel, Indiana, one of the most affluent suburbs of Indianapolis. The 140,000-square foot Allied Solutions Building, already around 87 percent leased, stands poised to increase dramatically in value thanks to its location in the heart of downtown Carmel in the heart of a busy mixed-use development surrounded by restaurants, coffee shops, fast-casual dining, service-oriented retail, and the locally renownedSun King distillery and food hall right next door.

13 cities where renting is cheaper than buying a home (AOL), Rated: A

Americans’ homeownership rate is 64.8%, according to the latest U.S. Census data.

Following are the 13 metros where renting is cheaper by more than $150 a month, beginning with cities with a smaller advantage for renters.

BlueVine Adds Term Loan to Suite of Online Working Capital Solutions to Fuel Small Business Growth (GlobeNewswire), Rated: A

BlueVine, which provides small- and medium-sized businesses with access to fast and simple online financing, announced that it is making term loan financing available for business owners through its suite of online financing solutions. The BlueVine Term Loan provides small- and medium-sized business owners with fast and simple access to financing to grow their businesses through BlueVine’s advanced online platform. More than 59 percent of businesses are looking for funds to grow their business, according to the 2017 Federal Reserve Small Business Credit Survey Report on Employer Firms. With a BlueVine Term Loan, business owners can quickly pursue larger projects and investments to bring their businesses to new heights.

Aura Approves 350,000th Affordable Loan (Bakersfield.com), Rated: A

Aura, a mission-driven financial technology company that offers affordable loans to hard-working families, this week approved its 350,000 th loan.

Since its launch in 2014, Aura has provided more than $437 million in credit-building loans to borrowers at approximately 1,200 partner locations using technology that enables local businesses to administer loan applications. Currently, Aura’s average loan size is around $1,600.

In total, Aura has raised over $403 million in social bonds across 21 bond issuances. The most recent issuance was in March for $50 million.

What Kind of Collateral Do I Need for a Business Loan? (Nav), Rated: A

Before you can qualify for a commercial loan, you’ll need to prove that doing business with your company is a good risk. This means you’ll need to pass successfully through a lender’s qualification process.

Next Wave of Personal Loan Growth May be Driven by Prime and Above Consumers (MarketWatch), Rated: A

The prime and above risk tiers have become a greater focus for lenders in recent years. Nearly two-thirds of unsecured personal loan balances originated in the first three quarters of 2018 were lent to prime and above consumers. FinTechs drove this shift as originations for prime and above grew to 62% in 2018, up from 52% in 2013. While still less conservative than banks, FinTechs’ overall risk profile for originations now aligns tightly with credit unions. At the end of 2018, FinTechs held the majority share of personal loan balances with 39%, while banks and credit unions followed with 28% and 21%, respectively.

Student Debt Isn’t Just An Employee Problem — It’s Also An Employer Problem (Killer Startups), Rated: A

The Federal Reserve Bank of New York reported in its Quarterly Report on Household Debt and Credit for the fourth quarter of 2018 that outstanding student loan debt increased to $1.46 trillion, which is $15 billion more than the previous quarter. It also reported that student loan debt rose by $79 billion in 2018.

The student debt load isn’t just impacting the individual students who enter the workforce, hoping they can find a job that enables them to make those monthly payments. I’s also slowing economic growth. A January 2019 Federal Reserve paper noted that young adults report their student loan debt is the reason they’re unable to buy a home. The same report also cited other research concluding that 20 percent of the decline in homeownership among young adults relates to student loan debt that’s been rising since 2005.

Amount Announces Cloud-Based Account Verification Platform (Kake), Rated: A

Amount today announced AmountVerify, a cloud-based platform for risk management across financial products. AmountVerify marks the first time industry leading fintech provider Avant is making a component of its cutting edge online lending platform available to financial service companies as a standalone product through Amount.

Onfido raises $ 50M to create the Identity Verification Standard for Businesses Globally (Markets Insider), Rated: A

Onfido, the global identity verification provider, today announced it has raised $50M in funding, bringing the total investment in the company to over $100M. The round was led by SBI Investment and Salesforce Ventures, with support from M12 (formerly Microsoft Ventures), FinVC and others, including existing investors.

Forward Financing Expands Capital Base with $ 90 Million Credit Facility (Yahoo! Finance), Rated: A

Forward Financing has closed on a $90 million credit facility, consisting of a $60 million senior revolving credit facility and a $30 million junior term loan. AloStar Capital Finance (“AloStar”), a division of Cadence Bank, N.A., served as the Agent on the senior facility.

Credibly Announces Investment Grade Senior Debt Offering (Yahoo! Finance), Rated: A

Today, Credibly announces the next phase in its balance sheet growth strategy with a $10 million Investment Grade-rated senior debt offering. The transaction closed on March 28, 2019.

Mitek Expands Auto-Capture User Experience Across All Digital Channels with the Addition of Desktop (GlobeNewswire), Rated: A

Mitek today announced it has upgraded its desktop browser experience to support auto-capture so customers can rapidly verify the identity of applicants across all digital channels: desktop browsers, mobile web and native applications.

According to Javelin Research, today only one third of users (34 percent) still complete the entire account opening process on their desktop.

MiSnap delivers a superior auto-capture experience for desktop and across mobile devices through:

  • Guided commands:  Real-time commands such as where to place a document in relation to the camera or detection of glare on the ID document are some of the conditions evaluated in order to help the user capture an optimal image, which improves image acceptance rates and reduces capture retries.
  • Advanced image analysis: Once MiSnap has achieved an optimal capture of the ID document, the software then further analyzes the image and makes the necessary adjustments in order to process all images consistently and accurately.
  • Modern architecture: Because MiSnap uses WebAssembly, it can perform at native speeds and is easy to integrate into customers’ web-based apps and requires minimal footprint.

58% of lenders will use AI in next two years (AI Foundry Email), Rated: A

Fannie Mae recently put out a 

  • Nearly two-thirds of lenders are familiar with AI
  • But, only 27% are using it in their businesses now, and…
  • Only half of that group are currently using it with customers (the rest are doing trials)
  • However, looking ahead two years – 58% of lenders expect to use AI/ML in their mortgage business.
  • Of the rest:
      • 22% predict they’ll be investigating AI
      • 19% foresee being in a “wait and see” mode

    These data points show us that “prime time” is coming soon for AI/ML in mortgages. 

    Fintech alone won’t be enough to boost credit union mortgage volumes (Credit Union Journal), Rated: A

    How can credit unions, especially small institutions, compete with Quicken Loans’ Rocket Mortgage “Push button, get mortgage” campaign?

    They can’t – and, sources said, they shouldn’t try.

    GROUNDFLOOR Wins 2 FinTech Awards (Groundfloor Email), Rated: B

    GROUNDFLOOR was named Best Crowdfunding Platform by the 

    Pulte Mortgage and Finicity Partner to Combat the Home Loan Paper Chase (MarketWatch), Rated: B

    Pulte Mortgage announced today it is partnering with Finicity — a leading provider of real-time financial data access and insights, to provide its borrowers with a faster, simpler and more secure way to navigate the home financing process.

    Hudson Data and LendingPoint partner to prevent Synthetic ID fraud (Finanzen), Rated: B

    Hudson Data and LendingPoint announced that they are partnering to create an industry solution to prevent synthetic identity fraud using powerful graph machine learning.

    Dharma crypto lending platform officially goes live (CoinGeek), Rated: B

    Dharma Labs completed a Series A funding round earlier this year to support its cryptocurrency lending platform project. The San Francisco-based company raised $7 million from companies such as Polychain Capital, Coinbase Ventures and others and, if there was any concern about the platform not going live, those concerns are now extinguished. Dharma announced this past Monday in a Medium post that the platform is now live.

    United Kingdom

    RateSetter ISA Milestone: Passes £200 Million in Subscriptions (Crowdfund Insider), Rated: AAA

    UK-based peer-to-peer lender RateSetter recently announced its ISA has now passed the milestone of attracting £200 million in subscriptions.

    “Investors have enjoyed an average annualised return of 4.5%, tax-free of course, since the RateSetter ISA launched in February 2018. The average RateSetter ISA balance stands at £11,000.”

    Funding Circle boss pocketed more than £4m last year (P2P Finance News), Rated: AAA

    FUNDING Circle founder Samir Desai (pictured) earned more than £4m last year, having cashed in some of his shares at the time of the peer-to-peer lender’s stock market flotation.

    Desai took home a salary of £210,000 last year, according to Funding Circle’s annual report, a four per cent increase from his salary of £202,000 in 2017.

    The majority of his total remuneration of £4.081m came from cashing in share options.

    Zopa rewrites outdated money idioms (The London Economic), Rated: AAA

    Each future-looking idiom challenges the status quo. For example, according to Zopa, the ‘signing for the bill’ gesture will be redundant soon. Instead, when people have finished their meal, people will be more likely to signal facial or iris recognition to the waiter. Jonesy gives his take and takes it one step further by illustrating a customer displaying his eyeball to request the bill.

    Source: The London Economic

    Fintech unicorns are leading job creation in London (Business Insider), Rated: AAA

    In 2018, there was a 61% increase in fintech job creation within London from the previous year, per a new report by Robert Walters, making it the fastest growing sector for vacancies in the city.

    The UK houses 25% of all fintech unicorns and their growth plans call for more talent. There are 29 fintech unicorns worldwide, seven of which are based in the UK, making the UK second only to San Francisco, which is home to nine.

    Over 30% of jobs in the UK’s fintech industry are for IT-related roles, compared with 24% in 2017. And fintech unicorns’ hiring for IT professionals increased 74% year-over-year (YoY).

    Source: Business Insider

    London to take San Francisco’s fintech unicorn crown (The Innovation Enterprise), Rated: A

    However, the report has predicted that London could take the lead as early as this year, as the city receives 39% of European fintech venture capital funding, with the runner-up, Berlin, taking just 21% of the total investment.

    With 50% against a global average of 33%, the UK also enjoys the highest rate of consumer fintech adoption of any Western country, only beaten by India and China, the report found.

    LendInvest gains £200m HSBC funding as it seeks home loan market entry (Verdict), Rated: A

    LendInvest, which operates an online marketplace for mortgages, has received an investment of £200m ($261m) from HSBC UK to support its foray into the regulated home loan sector.

    Peer-to-peer scheme for first-time buyers launches (FT Advisor), Rated: A

    Start-up company Stepladder is promoting a new way for first-time buyers to save for a house deposit.

    Arbuthnot Latham launches Arbuthnot Direct for those seeking long-term interest returns (Arbuthnot Email), Rated: B

    Arbuthnot Latham & Co., Limited (“Arbuthnot Latham”) is pleased to announce the launch of its new platform under the trading name of Arbuthnot Direct. Arbuthnot Direct offers fixed term deposits online, targeting retail customers who are seeking interest returns on their money over the longer term. The platform held a successful soft launch in February 2019 and has already met with a positive reception.

    China

    The rise and fall of P2P lending in China (Finextra), Rated: AAA

    It is worth mentioning that the size of China’s P2P industry is larger than that of the rest of the world combined, with outstanding loans of US$217.96BN.

    China’s online P2P lending industry grew rapidly between 2011 to 2015, with the number of P2P lenders growing from 50 to nearly 3,500 respectively.

    Trouble started brewing in China back in 2016, when statistics released by the Chinese Banking Regulatory Commission showed that about 40% of P2P lending platforms were in fact Ponzi schemes.

    This triggered the shutdown of P2P lending platforms; over 900 closed by the end of 2016. For 2018, only 1,021 providers remained in place.

    Source: Bloomberg News

    Shenzhen police arrest Zhang Wei, calling China Create Capital a ‘mafia-like gang’ (SCMP), Rated: A

    China Create Capital Limited, the investment holding company headed by the 46-year-old Heilongjiang native is a “mafia-style gang” involved in illegal fundraising, harassment, blackmail, illegal detention of people and the possession of firearms, the Shenzhen police said in a notice. The whereabouts of Zhang, who was arrested with 43 other executives of China Create, could not be ascertained.

    The arrests are the latest in the Chinese government’s crackdown on crime and corruption in the country’s financial system and capital markets, where 1,129 “mafia-like” syndicates were broken up across 10 provinces last year, with 4.94 billion yuan (US$737 million) of assets seized, according to the police. A number of Chinese oligarchs including Anbang Group’s

    former chairman Wu Xiaohui

    , CEFC Group’s founder Ye Jianming and financier Xiao Jianhua had fallen from grace since 2017.

    $ 60 Million and Rising: China’s Crypto Funds Try Lending to Beat Bear Market (CoinDesk), Rated: A

    These new crypto lenders include such notable names as Bixin Capital, FBG Capital and DGroup, founded by Dong Zhao, who made a name by operating one of the longest-running over-the-counter (OTC) trading desks in China. Along with a startup called Babelbank, these investors have originated a combined $60 million worth of loans over the last five months, denominated in cryptocurrencies or, in one firm’s case, Chinese yuan.

    European Union

    Klarna launches global customer authentication platform (Klarna), Rated: AAA

    Klarna today announced the launch of its global authentication platform — an aggregator with multiple global and local authentication solutions. The platform allows multinational businesses, including merchants and other banks, to provide a simple, secure and personalised customer authentication experience irrespective of market, through a one-time integration.

    Klarna Sees Payments as Evolving From Function to Engagement (WWD), Rated: A

    Klarna’s Hannah Bravo says customers chose brands based on payment options.

    This New Tool Is Helping Retailers Build Consumer Trust During Online Checkouts (Footwear News), Rated: B

    The Klarna platform enables businesses to choose from a range of global and local authentication methods so that they can find one that works best for their customer. Whether using SMS verification or emailed one-time passwords, brands and retailers can verify their customers’ identities with minimal interruption to the consumer’s shopping journey.

    International

    Drivers of Global Growth in FSB’s Shadow Banking (DBRS Email), Rated: AAA

    DBRS sees significant risks stemming from continued growth in shadow banking globally. Assets are now at $52 trillion globally, up from $30 trillion in 2010, according to the FSB. The U.S. has the largest concentration with 29% of global shadow banking assets. But, this is down from 48% in 2010, as other regions are growing faster.

    Summary highlights of the commentary include:

    • Shadow banking is still growing. This narrow, but rapidly growing, subset of nonbanks had assets of $52 trillion in 2017, up 75% from $30 trillion in 2010.
    • Since 2010, assets of nonbanks are also growing, up 61% to $185 trillion. That is 49% of the $378 trillion in total global assets in all financial institutions at the end of 2017, up significantly from 44% in 2010.
    • The key driver of this growth in nonbank assets is the expansion of OFIs. These OFIs are defined as all financial institutions that are NOT central banks, banks, insurance companies, pension funds, public financial institutions, or financial auxiliaries. Assets at these OFIs grew 71% since 2010 to a record $117 trillion in 2017, or just over 30% of assets in financial institutions globally.
    • By far, the largest segment of shadow banking globally is collective investment vehicles, which are subject to runs. These include fixed income funds, mixed funds, MMFs and hedge funds. Since 2010, this segment has grown by 130% to $36.7 trillion in assets. By contrast, growth in other segments has been less than $1 trillion, or even negative.

    Read the full report here.

    Crypto Lending Platform Salt Adds Support for Dash as Collateral (Crypto-Economy), Rated: A

    Cryptocurrency lending platform Salt will now be allowing its users to collateralize their Dash holdings including their Masternode staking coins to access loan facilities.

    India

    RentoMojo in talks to raise $ 40 million from GMO, others (livemint), Rated: A

    For RentoMojo, the latest fundraise comes almost two years after it raised $10 million in July 2017 from Bain Capital, Accel and Chiratae Ventures. Renauld Laplanche, chief executive of US-based Lending Club, also took part in his personal capacity.

    Asia

    Housing sector remains major source of complaints: BPKN (The Jakarta Post), Rated: A

    The BPKN received 154 complaints in the first quarter, most originating from the housing sector. BPKN communications and education coordinator Arief Safari said the agency had received 129 complaints on the housing sector in the first quarter, followed by six complaints on online peer-to-peer (P2P) lending, three on banking and the remainder on various sectors, including travel and e-commerce.

    Batumbu to help finance SMEs (The Jakarta Post), Rated: A

    PT Berdayakan Usaha Indonesia has announced that it aims to help small and medium enterprises (SME) access financial capital through a partnership program with its digital platform Batumbu.

    MENA

    Authors:

    George Popescu
    Allen Taylor

    The post Thursday April 11 2019, Weekly News Digest appeared first on Lending Times.

    Thursday April 4 2019, Weekly News Digest

    soft spending

    News Comments Today’s main news: Affirm raises $300M. LendingClub charged with privacy violation. Funding Circle issues 187M GBP securitization. Zopa legacy portfolio drags. Fellow Finance facilitates 18.2M euros in March loans. Today’s main analysis: March 2019 debt report from LendingTree (A MUST-READ). Today’s thought-provoking articles: Interview with SoFi CEO Anthony Noto. The slowing U.S. economy. […]

    The post Thursday April 4 2019, Weekly News Digest appeared first on Lending Times.

    soft spending

    News Comments

    United States

    United Kingdom

    European Union

    International

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    News Summary

    United States

    Max Levchin’s Affirm raises $ 300 million (Axios), Rated: AAA

    Affirm, the consumer credit startup led by PayPal co-founder Max Levchin, has raised around $300 million in Series F funding at a $2.9 billion post-money valuation, Axios has learned from multiple sources.

    PayPal co-founder’s fintech company scores $ 300 million, plans massive hiring in S.F. (Biz Journals), Rated: A

    Flush with a monstrous funding round, this San Francisco-based fintech company plans to ramp up its hiring from 580 employees to 850 by the end of the year – and the bulk will be in the Bay Area.

    FTC Privacy and Data Security Report for 2018 (JDSupra), Rated: AAA

    • LendingClub, a peer-to-peer lending company, was charged with failing to deliver adequate privacy notices to consumers required by the Gramm-Leach-Bliley Act’s Privacy Rule and Regulation P. The FTC’s complaint alleged that “LendingClub violated these rules by failing to provide its customers with clear and conspicuous notice before collecting consumers’ financial data and by failing to deliver the notice in a way that ensured that consumers received it.” Customers were instead forced to follow a series of links before being able to review the privacy policy, a method the FTC deemed to be improper.

    Anthony Noto of SoFi (Lend Academy), Rated: AAA

    The CEO of SoFi talks priorities, innovation, company culture, competition and what it will take to build a world class financial services firm

    Read the full transcript of the interview here. Interview by Peter Renton.

    US Economy Slowing (PeerIQ), Rated: AAA

    US 4th quarter GDP growth slowed to 2.2%, as what is shaping up to be the largest expansion in US economic history starts to lose steam. Consumer spending also slowed in January, rising by just 0.1% MoM. The Fed’s preferred inflation gauge, PCE, rose by just 1.4% YoY, justifying the Fed’s decision to keep rates on hold. Overall signs point to a slowing economy in the late stages of an expansion.

    Source: Bloomberg, PeerIQ

    LendingTree Debt Report – March 2019 (LendingTree), Rated: AAA

    After a brief respite in mid-2018, the debt-to-income ratio for consumer debt rose once more, reaching 25.41% by the end of 2018. That falls just shy of the all-time high of 25.49% set one year earlier.

    Household wealth saw a $5 trillion decline last quarter

    Losing $5 trillion of wealth may sound disastrous, but that’s what happened to American households last quarter. According to the Federal Reserve, total net worth of U.S. households fell from $108 trillion to $104.3 trillion in the last quarter of 2018. The loss was the biggest quarterly drop since the depths of the great recession of 2008.

    PayPal Makes Its First-Ever Investment in a Blockchain Startup (CoinDesk), Rated: A

    Announced today, PayPal has joined the extension of a Series A funding round in Cambridge Blockchain, a startup that helps financial institutions and other companies manage sensitive data using shared ledgers.

    Neither PayPal nor Cambridge Blockchain disclosed the investment amount, but recent filings with the SEC indicate that Cambridge Blockchain has raised a total of $3.5 million in new equity from several investors over the past nine months. That follows the $7 million close of its Series A in May of 2018, and brings the total capital raised to $10.5 million.

    Zillow is now a mortgage lender, launches Zillow Home Loans (HousingWire), Rated: A

    Zillow announced Tuesday that it is launching its own mortgage lending operation, which it is calling Zillow Home Loans.

    A payday lender in disguise? New York investigates the Earnin app (American Banker), Rated: A

    As early wage access programs such as Even, PayActiv, FlexWage, ZayZoon and DailyPay gain traction, some other apps are copying their style while using a more traditional payday-loan model — sparking attention from law enforcement agencies in the process.

    That’s what happened to Earnin, which is often referred to and bills itself as an early wage access provider, which give employees access to their paychecks before they are deposited. The New York Department of Financial Services launched an investigation of the firm over concerns it may be skirting state lending laws by, among other things, requiring tips from users in lieu of disclosing fees.

    Crypto Lending Platform BlockFi’s Interest Account Customers Receive Their First Interest Payments (Bitcoin Exchange Guide), Rated: A

    Leading crypto lending platform BlockFi recently announced that their Interest Account customers received their first interest payment for their Bitcoin [BTC] and Ethereum [ETH] deposits.

    Since their public launch on March 5, BIA has grown by over 400% and counting. Approximately 75% of BIA clients have a balance of less than 5 BTC or 150 ETH. Their median account balance is $7,000 USD.

    Crypto lenders push no-tax perk of leveraging bitcoin for cash (American Banker), Rated: A

    Former Wall Street trader Edgar Fernandez used some of his bitcoin as collateral to borrow nearly $100,000, a move that let him keep his cryptocurrency and avert a tax bill on the newly acquired cash.

    Genesis Capital, a cryptocurrencies lender in Jersey City, New Jersey, an affiliate of Genesis Trading, says it handed out more than $1.1 billion in cash loans and borrowed virtual cryptocurrencies in 2018. That total volume doubled in the last quarter of 2018 from the volume of the previous two quarters. Other lenders have also said they are doing more transactions, including Nexo, a cryptocurrencies lender that says it has loaned $330 million since launching last April.

    Atomic Capital Goes On The Attack With New Crypto Loan Offer In The Market (Bitcoin Exchange Guide), Rated: A

    The asset tokenization company, Atomic Capital, is making a very aggressive loan offer in the crypto lending field. Back on Wednesday, the firm will be giving USD loans for 85% of the value of the Bitcoin (BTC) or Ethereum (ETH) used as collateral. In this way, the firm will be offering the most generous loan-to-value (LTV) in the space.

    Just to put it into comparison, BlockFi offers a maximum LTV of 50%. Celsius Network, meanwhile, is giving customers 25%, 33% or 50% LTV.

    Atomic will be charging interest rates of 11% and 13%. This is much more than the 4.5% or 8.95% that other competitors offer.

    New $ 4.8m funding for SME bank Novo (Fintech Futures), Rated: A

    Novo has raised $4.8 million in venture seed financing to make banking accessible for small businesses by launching no-fee FDIC-insured digital banking.

    Blend seeks to deepen bank ties with account opening product (American Banker), Rated: A

    Blend is aiming to expand its customer base of banks and credit unions with a digital account opening product that it says takes some customers as little as two minutes to complete.

    The account comes in addition to the mortgage products the digital loan origination fintech already offers and can stand on its own or be integrated as a package, the company said Tuesday.

    Will Millennials Bring Non-banks into Their Finances? (deBanked), Rated: A

    According to an Accenture surveyfrom five years ago, 34% of millennials said they would bank with Apple if such a product were available.

    Best low cost franchises to get into (BM Magazine), Rated: A

    Business Services Franchise

    Success Member Inc.: It is the leading online loan marketplace that connects consumers with banks, credit partners and multiple lenders both nationally and internationally. They offer training with an expert to this industry of 33 years, along with a lifetime one-on-one dedicated support.

    Minimum Cash Required:$25,000

    • Training and Support: Yes
    • Financing: Yes
    • SBA Approved: Yes
    • Home-Based: Yes

    Goldman Sachs’ Marcus Loses Product Head (PYMNTS), Rated: A

    Marcus, the consumer bank operated by Goldman Sachs, has seen its head of product Michael Cerda quit his job.

    Tradeweb Raises $ 1.1 Billion in Year’s No. 2 IPO in U.S. (Bloomberg), Rated: A

    Tradeweb Markets Inc. raised $1.1 billion in the second-largest U.S. initial public offering this year, after again increasing the number of shares it was selling and then pricing them above the marketed range.

    Tradeweb’s IPO is also the biggest for a financial services company in the U.S. since online lender GreenSky Inc. raised $874 million in May.

    Class Action Lawsuit Filed Against Brendan Ross, Direct Lending Investments, and Others (deBanked), Rated: A

    A class action lawsuit has been filed in California against Direct Lending Investments, LLC (DLI), Brendan Ross, Bryce Mason, Frank Turner, Rodney Omanoff, and Quarterspot Inc. alleging breach of contract, breaches of fiduciary duty, aiding and abetting breaches of fiduciary duty, and fraudulent inducement.

    Read the full complaint here.

    AI-Powered Asset Manager Pagaya Goes
    After Real Estate (Institutional Investor), Rated: A

    Pagaya, which manages money using algorithms created with artificial intelligence, has raised $25 million in a series-C financing round led by Oak HC/FT, a health care and financial technology venture firm.

    The fund raise will support the company’s move into real estate, corporate credit, mortgages, and other asset classes.

    White Oak Commercial Finance Adds Origination Talent in Texas (AP News), Rated: B

    White Oak Commercial Finance (“White Oak”), an affiliate of White Oak Global Advisors, today announced the appointment of Andrew Bae to Director of ABL Originations, concentrating on Texas and the Southwestern U.S. region. Mr. Bae brings nearly 20 years of experience in commercial finance, most recently leading the establishment of the Dallas office for ExWorks Capital, a senior secured debt fund.

    Charles Schwab Now Offers Investment Advice Digitally via Subscription (Subscription Insider), Rated: A

    Clients pay a one-time fee of $300 and then $90 a quarter.

    United Kingdom

    Funding Circle back in securitisation market with £187m deal (P2P Finance News), Rated: AAA

    FUNDING Circle has entered the securitisation market for the third time, with a £187m portfolio of UK loans originated by the peer-to-peer business lender.

    Alternative asset manager Pollen Street Capital is the equity sponsor of the deal, having backed Funding Circle’s last securitisation eleven months ago.

    While Funding Circle operates in the UK, the US, Germany and the Netherlands, the loans included in the securitisation are just from the UK.

    Zopa legacy portfolio drags on P2PGI performance (P2P Finance News), Rated: AAA

    P2P GLOBAL Investments (P2PGI) has blamed its poorly-performing legacy Zopa portfolio for its latest net asset value (NAV) dip.

    The alternative finance-focused investment trust generated a NAV of just 0.31 per cent in February 2019, down from 0.45 per cent in January, and 0.75 per cent in December. This brings the trust’s annualised NAV to 3.7 per cent.

    Will more challenger banks evolve as banking as a service providers? (Tearsheet), Rated: A

    Starling Bank recently raised £75 million to fund a European expansion. As part of that announcement, the UK-based challenger said it had signed on three new clients to its banking as a service.

    According to Starling, it has 20 institutional clients on its BaaS platform, which it launched in August 2018. Payment volume through the service is doubling month over month.

    Monzo, following Revolut and N26, mulls new £11 per month premium offering (AltFi), Rated: A

    Digital challenger bank Monzo crowned a bumper year in 2018 by coming first for customer service in an independent survey, stealing the title from regular winner First Direct. But will its growing legion of coral card-carriers ever pay for its expanding array of services?

    The bank, which is now testing a new paid-for premium offering, thinks they might just do so. ‘Monzo Plus’ – as it is being called – even allows users paying a monthly fee to have Monzo cards in colours other than its famous ‘hot coral’ colour.

    How to join the rush for a last‑minute Isa (The Times), Rated: A

    There are now just over 48 hours left to make the most of the annual tax breaks on offer in an individual savings account (Isa). This year’s £20,000 allowance expires at midnight on April 5 and you can’t carry it over so it’s a case of use it or lose it.

    Monevo Review – An Excellent Place to Begin Your Loan Search (DoughRoller), Rated: A

    Through Monevo, you’ll be matched with loans of up to $100,000 with interest rates ranging from 3.99% to 35.99% APR; finding this many competitive options could take you hours to do individually. With Monevo, you can do it in about 60 seconds.

    FCA warns that P2P Isas are ‘high risk’ (Money Observer), Rated: A

    The Financial Conduct Authority (FCA) has warned that mini-bonds and peer-to-peer loans held within the Isa wrapper are “high risk”.

    Payday lending isn’t over yet – and now its victims are being shortchanged yet again (Independent), Rated: A

    The administrators of WageDay Advance, which went under in February, have started contacting thousands of former customers owed compensation through being mis-sold loans by the company to urge them to join a growing list of creditors.

    Compared with Wonga, WageDay was more of a piranha fish than a shark – but the problems it has created aren’t all that different.

    Five ways to add IFISA diversity (P2P Finance News), Rated: A

    THIS WEEK is the busiest of the year for ISA providers and ISA savers alike. As the end of the tax year approaches, investors and savers are rushing to make the most of their annual ISA allowance, while ISA managers scramble to convince them that theirs is the right product.

    I trust bricks and mortar and want to invest but what’s the best way to create an income from property? (This is Money), Rated: A

    People are still making money from property and always will, sometimes lowering their exposure by jointly investing with friends and family, or looking at peer-to-peer lending. Investing locally can give first time investors more confidence as they know their own postcodes, and can keep an eye on what’s going on.

    Finastra welcomes Sharon Doherty as Chief People Officer (Techapeek), Rated: B

    Finastra today announced the appointment of Sharon Doherty, as Chief People Officer. Doherty joins from Vodafone, where she held the position of Global Organization and People Development Director. In her new role at Finastra she will have global responsibility for making Finastra the most loved and inclusive employer in the Fintech industry.

    China

    Regulators to pilot P2P lender registration program in back half of 2019 (technode), Rated: AAA

    China is expected to start piloting a registration program for online peer-to-peer (P2P) lending platforms in the second half of this year. Regulators plan to start requiring P2P lenders in pilot cities, located in more developed regions, to register with the monitoring system. Regional and national players will have to meet certain requirements on registered capital, risk reserves, and lender risk compensation in order to be registered in the system. Regulators aim to roll out the national registration system by 2020.

    European Union

    Fellow Finance’s platform facilitated 18,2 million euros of loans in March (GlobeNewswire), Rated: AAA

    In March Fellow Finance investors funded business and peer-to-peer loans worth around 18,2 million euros. Cumulative loan volume grew over 415 million euros and the total number of investors grew to 12 031. You can always check the real-time peer-to-peer lending statistics on our website: www.fellowfinance.com/for-investor/statistics.

    Finleap acquires German challenger bank Penta (Fintech Futures), Rated: A

    European fintech ecosystem Finleap has acquired Berlin-based digital sector banking solution Penta, reports Jane Connolly.

    CoinLoan Enables Borrowers to Obtain Fiat Currency Using Cryptoassets as Collateral (Cardrates), Rated: A

    In a Nutshell: In the wake of the 2008 financial crisis, peer-to-peer (P2P) lending arose as an alternative to credit offered by traditional banks. At the same time, blockchain-based cryptocurrencies like Bitcoin also emerged. Now, CoinLoan is bringing the two together through its P2P lending platform that lets borrowers use cryptoassets as collateral for obtaining fiat (or traditional) currency. Lenders provide capital with a guarantee from CoinLoan that they will be repaid in full. Borrowers gain access to funds without needing to dispose of their cryptoassets or prove their creditworthiness.

    International

    Women in Fintech Demolish Glass Ceiling (Lend Academy), Rated: AAA

    Valerie Kay, Chief Capital Officer at LendingClub, is responsible for overseeing LendingClub’s Investor Group. She addresses the need for diversity, inclusion, mutual respect and collaboration. She emphasizes the vital importance of diversity to drive better workplaces, happier customers and more profits.

    Andrea Gellert, Chief Revenue Officer and Chief Marketing Officer of online small business lender OnDeck, says she sees good progress being made by Fintechs in finding female candidates at all levels including C-Suite and board positions. She points out, “There are more female founders than there used to be. We are moving at a much more accelerated pace than previous industries did in terms of female management.”

    Onfido scores $ 50 million investment (Finextra), Rated: A

    Onfido, the global identity verification provider, today announced it has raised $50M in funding, bringing the total investment in the company to over $100M.

    Australia

    Australian neobanks target scale of UK rivals without growing pains (AltFi), Rated: AAA

    Sydney-based digital bank Volt promises to offer a faster more personalised service than the country’s big four incumbents – National Australia Bank, Commonwealth Bank, Australia and New Zealand Banking Group and Westpac.

    Melbourne-based small business bank Judo launched last June lends between A$250,000 to A$5,000,000, and is process of applying for a banking license from the Australian Prudential Regulation Authority.

    Brokers urged to seize opportunities in SME space (TheAdviser), Rated: A

    According to research from small business lender OnDeck Australia, which involved a survey of 331 business with an annual turnover of less than $5 million, 25 per cent of SMEs plan to seek additional finance over the next 12 months.

    India

    P2P lending (Invest in India), Rated: AAA

    India currently has about 30 online P2P lending platforms. Some of these are Faircent, i2ifunding, Lendbox etc. In 2018, as many as 11 P2P players received the RBI licence to operate as an NBFC – P2P company. RBI in its master directions has defined NBFC – P2P as a non – banking institution which carries on the business of a peer – to – peer lending platform. The estimated P2P lending to be generated in India over the next 5 years is pegged at around $ 4 bn. Whereas in China, the P2P lending book currently is around $ 100 bn.

    Southeast Asia

    SINGAPORE-based  leading SME lending platform Validus Capital (Validus) and Lighthouse Canton, an independent asset management and family office advisory services firm, jointly announce the reopening of the LCV Trade Finance Fund (the Fund) with additional capacity of US$14.8 million (S$20 million; RM60 million).

    Canada

    OnDeck merges Canadian ops with Evolocity (Finextra), Rated: AAA

    OnDeck (NYSE: ONDK), the leader in online lending to small business, today announced it has completed the transaction combining its Canadian operations with Evolocity Financial Group (Evolocity), a Montréal-based online small business lender. The combined companies are majority owned by OnDeck.

    South Africa

    For South Africa’s first challenger bank, conversational AI isn’t just a nice-to-have (Tearsheet), Rated: AAA

    South Africa’s TymeBank has launched Max, an AI-powered conversational assistant designed to help consumers learn about personal finance.

    For South Africa’s first challenger bank, conversational AI is an important piece of its product roadmap.

    Latin America

    Why Fintech Startups Are Rapidly Becoming Unicorns in Latin America (Next Billion), Rated: AAA

    Fintech was the #1 sector of venture capital investments in Latin America last year, and experts are estimating that the LatAm fintech market will exceed $150 billion by 2021.

    In the past few years, over 300 fintech startups have been born in Mexico alone, coming in just second to Brazil, which boasts nearly 400 startups in its own fintech sector.

    Authors:

    George Popescu
    Allen Taylor

    The post Thursday April 4 2019, Weekly News Digest appeared first on Lending Times.

    Thursday December 20 2018, Daily News Digest

    US Yield Curve

    News Comments Today’s main news: OnDeck to enter equipment financing. SoFi releases video to destigmatize debt. RateSetter sees 47% revenue growth. Funding Circle fund expects lower returns. 360 Finance financials. Today’s main analysis: U.S. yield curve inverts. Today’s thought-provoking articles: Why did OnDeck file suit in Arlington? Fewer Americans rely on cash. More than half of Americans can’t cover a $1,000 […]

    The post Thursday December 20 2018, Daily News Digest appeared first on Lending Times.

    US Yield Curve

    News Comments

    United States

    United Kingdom

    China/Hong Kong

    Southeast Asia

    Other

    News Summary

    United States

    OnDeck (ONDK) to Enter Equipment Financing Market (StreetInsider), Rated: AAA

    OnDeck announced today that it will begin offering equipment finance loans to select U.S. small businesses next year, bringing its heralded technology and digital lending expertise to what has traditionally been a slow-moving, opaque, and complicated process.

    Who’s On Deck? And why are they in Arlington? We explain. (Biz Journals), Rated: AAA

    At 2 p.m. on a Friday in mid-October, it’s judgment day for 13 small companies from across the country.

    The plaintiff is On Deck Capital Inc., a publicly traded online small business lender based in New York that has sued each of the 13 companies for not repaying loans. Its choice of setting: the Arlington General District Courthouse.

    New SoFi Campaign Aims To Destigmatize Debt and Financial Insecurity In Powerful “Money Talks” Video (PR Newswire), Rated: AAA

    SoFi today launched a campaign showcasing some of its members’ most intimate stories around their personal struggles with money. Produced in collaboration with director Tatia Pilieva, the filmmaker most notably known for her sensational short film ‘First Kiss,’ the video captures twelve SoFi members, strangers to each other, meeting for the first time to have open-ended, unfiltered conversations about their lives, their money, and their views for their futures.

    The video, along with more about the members featured in the video, are now live at 

    US Yield Curve Inverts; Spreads Widening on New FinTech Deals (PeerIQ), Rated: AAA

    Core CPI rose by 2.2% keeping the Fed on track to raise interest rates next week for the fourth time this year. The market-implied probability of a rate hike next week is ~77%, although the rate hike path in 2019 remains uncertain. The US yield curve saw its first post-crisis flatteningwhich we will look at in greater detail below.

    US Yield Curve Inverts for the First Time Post-Crisis

    The US yield-curve saw its first inversion post-crisis as the spreads between the yields on 3-year and 5-year Treasuries fell to -1 bps. The spread between the yields on 3-month and 10-year treasuries has been an accurate predictor of past recessions. As the chart below shows, there have been 6 recessions since 1970 after the 3-month – 10-year curve inverted. Currently, the 3-month – 10-year curve is 49 bps away from inversion, but markets are watching every part of the yield curve closely.

    Source: Federal Reserve, PeerIQ

    Spreads are Widening on New FinTech Deals

    LendingClub and CommonBond are out with new securitizations. KBRA has rated the tranches on LendingClub’s latest $272 Mn deal CLUB 2018-P3 A-, BBB, and BB. The $300 Mn collateral pool consists of 17,825 Prime loans with an average balance of $16.8 k, a weighted average coupon of 14.58%, and a weighted average remaining term of 48 months. The weighted average FICO score of the borrowers is 703. The deal has an initial O/C of 9.2% and an excess spread of 9.1%. Both the O/C and excess spread are the lowest for LC’s 2018 prime deals. This deal priced 27-50bps wider than LC’s prior deal in September due to market volatility and widening structured products spreads, according to DebtWire.

    More Americans are making no weekly purchases with cash (Pew Research), Rated: AAA

    Entegra Bank Chooses Velocity Solutions to Power Its Small Business Digital Lending (deBanked), Rated: A

    Velocity Solutions announced today that its Akouba digital lending platform was selected by Entegra Bank to power the bank’s digital lending for its small and medium-sized business customers. Akouba provides community and regional banks with origination and underwriting services.

    LoanStreet Signs Up Workers Credit Union to Use Fintech Loan Participation Platform (Crowdfund Insider), Rated: B

    LoanStreet, a Fintech “loan participation platform,” has signed up Massachusetts-based Workers Credit Union to its growing network.

    Lending Express Appoints Former Maple Founder Ofer Ariel to Chief Product Officer; Promotes Daniel Katz to Chief Operating Officer (PR Newswire), Rated: B

    Lending Express, the technology company dedicated to increasing access to funding for small businesses, today announced the promotions of Ofer Ariel and Daniel Katz to Chief Product Officer and Chief Operating Officer, respectively. This announcement follows a period of impressive growth for the company, and is indicative of its commitment to provide best-in-class service to both its customers and partners.

    United Kingdom

    RateSetter Announces 2017-18 Revenue Growth of 47% (Crowdfund Insider), Rated: AAA

    UK based peer-to-peer lender RateSetter announced last week the results of its 2017-2018 financial year, which ended on March 31, 2018. The lending platform reported that revenues were up by 47% (which was £34.3 million) from the previous year (£23.4 million). The company noted that the year-end, there were 44,441 active investors on the platform with loans under management of £700 million.

    Funding Circle fund expecting lower returns (AltFi), Rated: AAA

    A hit from its European Investment Bank transaction as well as higher UK loss rates have prompted a fall in expected returns for the Funding Circle SME Income fund.

    The £332m Funding Circle SME Income Fund saw a fall in its net asset value (NAV) of 1.4 per cent in November as the investment trust’s board said it expected returns for the full year would be lower than previously anticipated owing to a higher expected rate of defaults among certain loan pools.

    Orca opens waiting list ahead of 2019 IFISA launch (P2P Finance News), Rated: A

    ORCA has opened a waiting list for investors interested in its self-select portfolio and Innovative Finance ISA (IFISA), with plans to launch both products in the first quarter of 2019.

    The peer-to-peer lending analysis and investment platform, which first revealed its plans to launch a tax wrapper to Peer2Peer Finance News in October, said the Orca ISA will allow investors to hold multiple P2P loans from different providers in one tax wrapper.

    It will offer interest of up to 6.5 per cent.

    Transferwise – the power of partnerships (Fintech Futures), Rated: A

    Cross-border payments were ripe for disruption and doing more than most to shake up things is peer-to-peer (P2P) specialist, Transferwise. Its number of partnerships with banks is multiplying while, in parallel, it is adding settlement options, most recently for direct access to the euro payment infrastructure through a euro settlement account with the Bank of Lithuania.

    At present, with one notable exception, the partner banks that have been announced are challenger or other low-end players. However, it now claims over four million people around the world using its service to transfer over £3 billion each month. In the UK, global head of partnerships, Stuart Gregory, says its share of consumer international transfers is around 15%, putting in on or close to a par with some of the largest UK banks.

    P2P property lending platform completes £10m investment round (AltFi), Rated: A

    Peer-to-peer property lending platform BLEND Network has completed a £10m late-seed round of investing.

    N26 Metal Now Available in the UK (coverageR), Rated: A

    N26, the provider of mobile banking services which launched in the UK last month with a free account, is now offering N26 Metal – its first premium membership for UK customers.

    For the price of £14.90 per month, Metal members get access to an exclusive partner program, dedicated customer service, and worldwide travel insurance provided by Allianz. In addition, members benefit from free ATM withdrawals in pounds, free payments in any currency, free withdrawals worldwide, and LoungeKey airport access in over 1k destinations.

    This ex-Googler wants to help high street banks be more like Monzo (Yahoo! Finance), Rated: A

    The head of innovation at one of Britain’s big high street banks told me earlier this year that he has a mantra when approaching a new problem: “What would Monzo do?”

    Traditional banks are struggling to keep pace as Monzo pushes the boundaries. The startup sends smartphone push alerts when you spend money, knows when you’re abroad, lets you freeze your debit card if lost, and offers chatbot customer service — all through the app.

    Onfido Sees 342 Pct Sales Growth In 2018 (PYMNTS), Rated: A

    Onfido, the global identity verification company, announced Tuesday (Dec. 18) that it achieved 342 percent sales growth in 2018 compared with 2017 and that it has a four-year growth rate of 3,857 percent.

    Starling Bank’s Megan Caywood jumps to Barclays’ ship (Fintech Futures), Rated: B

    Megan Caywood, Starling Bank’s chief platform officer, is joining Barclays, as she handed in her notice a couple of weeks ago, according to TechCrunch.

    China/Hong Kong

    How a Chinese anti-virus software maker builds a fintech firm to wrestle with giants (TechCrunch), Rated: AAA

    360 Finance,  an online consumer loan platform that spun off from China’s anti-virus service giant 360 Group, has joined a raft of Chinese fintech companies to go public in the U.S. over the last two years.

    The company priced its initial public offering at $16.50 per share last Friday, raising $51 million by selling 3.1 million American depositary shares.

    Source: TechCrunch

    You’ve applied for a Virtual Bank license, what’s next? (Hubbis), Rated: AAA

    Hong Kong is preparing for the arrival of virtual banks (VB) — pure digital players that offer banking services solely through digital channels without bricks-and-mortar branches. In an exclusive article from Synpulse we discover the challenges associated with virtual banking.

    What is your differentiating proposition?

    With HKMA’s recent announcement of receiving 29 applications for VB, competition is expected to be intense.

    Focus on Customer Needs

    Basic banking services are about fulfilling three main needs of the customer:

    • How do I pay or get paid?
    • How can I borrow?
    • How do I grow or protect my savings?

    Capitalize on strong partnerships

    FinTechs have traditionally excelled in one particular area (e.g.p2p lending, remittance and FX conversion).

    Avoid a Pure Discount Model

    VBs can leverage their lower operating costs to provide lower fees, higher deposit rates or other price incentives to attract customers. However, without a clear differentiating proposition, a pure low-cost play will not be sustainable.

    Jiayin, a Top Player in P2P Lending Business, Files for $ 57.5 Million IPO on Nasdaq (Capital Watch), Rated: A

    A leading individual financial marketplace, Jiayin Group Inc., is seeking to raise up to $57.5 million in an initial public offering on the Nasdaq Global Select Market in New York.

    ByteDance registers fintech trademarks (Technode), Rated: A

    In July, Jinri Toutiao launched a fintech product named Safe Lending. Up to 20,000 users were permitted to borrow up to RMB 200,000 (around $30,000) per person per day. The company claimed the Bank of Nanjing was one of its loan partners.

    The product became the subject of investigations by the media in September. ByteDance later shuttered the online money lending service, while thousands of Chinese P2P lending companies shut down in the second half of the year.

    PINTEC Partners with China National Investment & Guaranty Corporation to Develop Digital Lending Technologies (Markets Insider), Rated: B

    Pintec Technology Holdings Ltd. (“PINTEC”) (NASDAQ: PT) today signed a strategic cooperation agreement with China National Investment & Guaranty Corporation (“I&G”), a leading enterprise in China’s guarantee industry. The two sides will jointly develop the next generation digital lending technologies and nurture a dynamic credit financing ecosystem for small and micro-sized enterprises in China.

    European Union

    Online Lender Creditshelf Partners with CrossLend to Offer First Digital Securitization of Loans (Crowdfund Insider), Rated: AAA

    Germany based Fintech creditshelf Aktiengesellschaft, an SME financing platform, is launching a new partnership with CrossLend to offer the first digital securitization of SME loans in Germany.

    A Visit to Crowdestor in Riga (P2P Banking), Rated: A

    On invitation of Crowdestor I travelled to Riga and met the founders of Crowdestor Janis Timma and Gunars Udris. Crowdestor is a Latvian p2p lending platform for SME loans. They launched a year ago. Loans are typically for terms of up to 18 months and interest rates are quite high – the current loan offer by a transportation company seeking expansion capital carries 17% interest rate. The Crowdestor website is available in English, German and Portuguese language. Currently most investors on the platform are Germans, followed by Spanish investors.

    Funding Options: From Fintech Petting Zoos To SME Lending Sanctuaries (Forbes), Rated: A

    Both financial institutions and fintech startups have made serving SMEs a priority in 2018. However, despite business current accounts like Mettle being created this year, online comparison marketplace Funding Options has helped millions of firms across Europe, especially those that cannot get traditional bank lending because they are early-stage, high-growth or in difficulty, since its launch in 2012.

    International

    Finastra announces Eric Duffaut as President and Global Head of Field Operations (RealWire), Rated: A

    Finastra has appointed Eric Duffaut as President and Global Head of Field Operations. Based at Finastra’s London Headquarters, Duffaut will take responsibility for the company’s entire go-to-market organization including global sales, services and consultancy, as well as overseeing the Finastra partner ecosystem.

    Strengthening the Spread: ETHOS Now Live on Nitrogen Network (CoinTelegraph), Rated: A

    Token of Ethos.io, a leading cryptocurrency wallet provider and Blockchain Financial Services (BFS) platform, has been officially listed on Nitrogen Network, a new decentralized peer-to-peer crypto lending network.

    Nitrogen Network enables market participants to lend and borrow cryptocurrencies on their own terms, all while maintaining control of their holdings and private keys. This supports effective portfolio management and a diverse range of investment views across a wide variety of crypto assets.

    Australia

    As banks become stricter with lending, could your HELP debt get in the way of getting a home loan? (ABC.net.au), Rated: AAA

    As banks rein in lending in the wake of the banking royal commission which revealed “irresponsible lending is endemic in Australia”, those who might have easily secured a home loan a few years ago now face much more stringent criteria.

    Banks are looking more carefully at expenses and debts which, for 2.7 million Australians, will include a HELP (formerly HECS) debt.

    India

    NBFC Vivriti Capital secures Rs 200 Cr from Creation Investments in Series-A equity funding (Your Story), Rated: AAA

    Vivriti Capital, a Chennai-based lending platform for corporate entities, has raised Series A equity funding of Rs 200 crores from Creation Investments, an investment management company focused on financial services.

    Crowdfunding – A Brief Overview Of The Regulatory Framework (Mondaq), Rated: A

    3. Peer-to-Peer Lending or Debt Crowdfunding: Peer-to-Peer Lending (P2P lending) is a form of crowdfunding used to raise loans which are re-paid along with interest. It can be defined as the use of an online platform that matches lenders with borrowers in order to provide unsecured loans. The borrower can either be an individual or a legal person requiring a loan. The interest rate may be set by the platform or by mutual agreement between the borrower and the lender. Fees are paid to the platform by both the lender as well as the borrower.2

    4. Equity Crowdfunding:

    The SEBI Consultation Paper furnishes proposals for a regulatory framework governing procedure of Security based Crowdfunding methods for Start-ups and Small and Medium Enterprises (SMEs).

    The Directions define a “Non-banking financial company – Peer to Peer Lending Platform”4(NBFC-P2P) as a non-banking institution which carries on the business of a Peer-to-Peer Lending Platform. Peer-to- Peer Lending Platform5 has been defined as an intermediary providing the services of loan facilitation via online medium or otherwise, to the participants6(a person who has entered into an arrangement with an NBFC-P2P to lend on it or to avail of loan facilitation services provided by it). Non-banking institutions other than companies have been prohibited from undertaking the business of Peer-to-Peer Lending platform.7 The Directions provide the scope of activities, prudential norms (the aggregate loans taken by a borrower at any point of time, across all P2Ps, is subject to a cap of Rs.10,00,000/-), operational guidelines, inter alia other regulations.

    Southeast Asia

    Why the ASEAN P2P lending market will avoid the Chinese pitfalls (ASEAN Today), Rated: AAA

    To say that 2018 was a rough year for peer-to-peer (P2P) lending businesses in China would be a gross understatement. It was nothing short of a bloodbath, mirroring in many ways the US sub-prime mortgage crisis of 2008-09.

    China, despite its economic power, shares the following crucial features with smaller markets in South and Southeast Asia:

    • A large percentage of small-to-medium enterprises (SMEs) and individuals without access to traditional banking services
    • High mobile penetration among the population
    • Easy access to investor funds, both domestic as well as international

    The Southeast Asian approach to P2P lending regulation is more proactive than the Chinese model

    In the heydays of P2P platforms in China, the authorities pursued more of a “wait and watch” approach. In marked contrast, the regulatory bodies of Southeast Asian economies have adopted more pro-active steps to regulation.

    Korea’s digital banks have two speeds: fast and faster (Asia Money), Rated: A

    The average internet speed in South Korea is 26.7 megabits per second, faster than anywhere else in the world, according to French virtual private network developer Le VPN.

    No Korean bank has ever been in the mix for this much-coveted prize. Nor did a single Korean firm appear in the latest Forbes rankings of the world’s 50 most innovative fintech companies. Indeed, it’s hard to identify a single well-known and home-grown fintech brand. There’s no Korean answer to, say, China’s Ant Financial, or Singapore-based ride-sharing-to-food-delivery service Grab.

    OJK Pledges to Announce Names of Illegal Fintech Firm (Tempo), Rated: A

    The Financial Services Authority (OJK) committed to monitoring legal and registered financial technology (fintech) companies of peer-to-peer lending or online loan as an effort to maintain the security for consumers.

    Eurasia

    Russia Is A Top Five Leader Of Digital Banking In Europe (Forbes), Rated: AAA

    Because of the lack of legacy IT infrastructure within banks in Russia, the country has been listed in the top five leaders of digital banking in Europe, according to a new Deloitte and ID Finance report.

    Latin America

    Vitacon innovates again and launches an investment opportunity starting at USD250 with return of up to 12,8% per year (PR Newswire), Rated: AAA

    Vitacon, a leading construction company that is revolutionizing the way people live in São Paulo, is launching one more investment opportunity for people seeking new options for earning income and diversifying their portfolios. The company, which for the past nine years has been incentivizing the shared economy in its residential developments, is launching the possibility for any investor to invest directly USD250 in a CD, a fixed income security issued by Banco Topázio, with a 24-month maturity, which allows for annual yields of up to 12.8%.

    This new method, P2P Lending, is similar to one introduced in 2015, when Vitacon launched the first real estate crowdfunding, which surpassed expectations and created an international benchmark in the field, raising 28% above what was expected for the construction of the VN Cardoso de Melo building in a very prime location of São Paulo, scheduled for delivery next year.

    Authors:

    George Popescu
    Allen Taylor

    The post Thursday December 20 2018, Daily News Digest appeared first on Lending Times.

    Mondy July 16 2018, Daily News Digest

    market implied inflation

    News Comments Today’s main news: LendingTree to acquire Student Loan Hero. SoFi to go after brokerage business. British Business Bank talking about backing Funding Circle loans. Funding Circle slashes US exposure. Duanrong raises $45M. Today’s main analysis: Deep dive on inflation. Today’s thought-provoking articles: New LendingClub account performance. New York state’s recommendations for online lending. Is there subprime auto loan bubble […]

    market implied inflation

    News Comments

    United States

    United Kingdom

    China

    Asia

    Other

    News Summary

    United States

    LendingTree, Inc. Announces Agreement To Acquire Student Loan Hero (Payment Week) Rated: AAA

    LendingTree, Inc. (NASDAQ: TREE) announced today that it has entered into a definitive agreement to acquire Student Loan Hero, Inc., a personal finance website dedicated to helping student loan borrowers manage their student debt.  Student Loan Hero offers current and former students in-depth financial comparison tools, educational resources, and unbiased, personalized advice.

    We are going after the brokerage business, says SoFi CEO (CNBC) Rated: AAA

    SoFi CEO Anthony Noto discusses the company’s “modern take on the checking account” and where he seeing the next big investment opportunity, including cryptocurrency.

    Rising Inflation, Deep-Dive on Inflation Trends (PeerIQ), Rated: AAA

    Consumer credit increased by $26.4 Bn in May, the largest monthly jump in 6 months, to an all-time high of $3.9 Tn. Growth was driven by a $9.8 Bn increase in revolving credit card debt. Credit growth has been averaging 7.6% fueling consumer spend-driven GDP growth. The Fed’s latest G-19 report can be found here.

    Source: Federal Reserve, PeerIQ

    Rising US Inflation

    US CPI rose by 2.9% YoY, its highest reading since March 2012. This week we look at various inflation measures and how they stack up against the Fed’s 2% inflation target.

    Measured Inflation vs the Fed’s Inflation Target

    Source: BLS, BEA, PeerIQ
    Source: Bloomberg, PeerIQ

    New LendingClub Account Performance – Q2 2018 (Lend Academy) Rated: AAA

    The current status of my LendingClub account is very typical for new investors. A handful of loans have been paid in full while just a couple have entered either grace period or the late 31-120 days stage. A majority of the loans are issued and current.

    Below is a screenshot of my target allocation shortly after account setup with about half of my capital allocated to LendingClub notes.

    Source: Lending Club

    Below is a screenshot as of today with all $5,000 invested which now closely resembles my target allocation.

    Source: Lending Club

    DFS Releases Recommendations for Online Lending (deBanked), Rated: AAA

    The New York State Department of Financial Services (DFS) released a report on Wednesday on the subject of online lending in the state. The report was mandated by a billsigned by New York Governor Andrew Cuomo on June 1 of last year.

    Source: New York Department of Financial Services

    Access the full report here.

    Loan applicants are reverse engineering the online lending algorithms (Tearsheet) Rated: A

    Online lenders are assailed by fraudsters on all fronts. There were 1579 data breaches in the U.S. in 2017, 302 of which resulted in the exposure of full credit and debit card numbers. Because online finance frees up applicants from having to show up physically to a bank, it also opens up opportunities for identity fraud. This really is the other side of phishing and identity hacks. Once data ends up in the hands of criminals, the next step is to monetize it by taking out fraudulent loans.

    Kabbage claims that 95 percent of its customers have a fully-automated underwriting experience.  “By getting customers to connect their Amazon, Square, eBay, and business bank accounts, Kabbage gets a direct view into the finances of a small business borrower,” said Yaakov Erlichman, vice president of fraud and underwriting strategy at Kabbage. “We have more than two million live data connections. It’s really hard to fake live business data.”

    You Accidentally Sent $ 149 to a Stranger on Venmo? Good Luck Getting It Back (Wall Street Journal) Rated: A

    With the rise of money-transfer apps such as PayPal Holdings Inc.’s Venmo, it’s never been easier for people to send money to their friends. It’s also never been easier to accidentally send money to a total stranger.

    Getting the money back is often far more difficult: Many digital payments are irreversible.

    For the recipient, it’s the equivalent of finding cash on the sidewalk— except it comes with a moral quandary.

    Baker Hill Inks Loan Origination Deal with West Texas State Bank (Finovate) Rated: A

    One month after bringing its loan origination platform to $5.6-billion North Carolina-based First Bank, Baker Hill is back in the news. The fintech is teaming up with West Texas State Bank (WTSB) to support efficient loan growth with its NextGen Loan Origination for Commercial and Consumer Lending platform. The technology, in the words of West Texas State Bank Chief Lending Officer and COO Les Robbins, will help the bank “streamline the origination process with … roles-based, intuitive lending solutions.”

    Uphold To Bring Crypto-Backed Credit To Members With Libra Credit Partnership (Block Tribune) Rated: A

    Cryptocurrency platform Uphold has partnered with crypto lending platform Libra Credit to offer its users access to a variety of Libra Credit products.

    Founded by former PayPal financial technology veterans, Libra Credit is an ethereum-based lending network that facilitates open access to credit anywhere and anytime. Libra Credit offers a seamless digital lending process that can be completed in five steps: application, verification and credit assessment, confirmation, collateral deposit, and disbursement. The platform focuses on a dual-credit risk scoring mechanism that considers the creditworthiness of the pledged collateral as well as the credit information of the borrower. Borrowers will be able to pledge any crypto-assets as collateral and receive loans in their desired asset.

    How to Choose Your First Real Estate Crowdfunding Investment (U.S. News) Rated: A

    Crowdfunded real estate investments account for $2.5 billion of the $7 trillion commercial real estate market, according to CFX Markets. There’s major growth potential in the industry as more investors lock in on the benefits of investing in real estate through crowdfunding platforms.

    United Kingdom

    British Business Bank in talks to back £150m of Funding Circle loans (Peer2Peer Finance) Rated: AAA

    FUNDING Circle’s listed investment trust is in talks with the British Business Bank (BBB) about providing further funding through the peer-to-peer platform.

    It comes as the Funding Circle SME Income Fund (FCIF) reported its net asset value (NAV) had increased from £308m to £165m in the year to March 2018, while its NAV total return was 14.9 per cent.

    FCIF highlighted a structured finance transaction with Citibank to fund loans through the Funding Circle platform as one of its major deals last year, and also revealed it was in talks with the BBB about providing up to £150m of funding.

    Funding Circle slashes US exposure after dividend cut (Citywire) Rated: AAA

    Funding Circle SME Income (FCIF) will reduce exposure to US loans after the increased cost of hedging the dollar saw the listed peer-to-peer fund cut its dividend.

    Last month, the alternative lender to small businesses said it would cut its annual dividend of 6.5p per share to between 5p and 6p, after a ‘material increase’ in the cost of removing the impact of changes in the value of the dollar on its portfolio.

    However, a ‘partial reallocation of capital deployment away from the US and towards the UK and continental Europe’ will see North American loans fall by up to 10% from 25% of the £329 million portfolio.

    LendInvest partners Onfido for digital verification services (Verdict) Rated: A

    Instead of the need for paper forms, LendInvest BTL applicants can now confirm their identity online by incorporating Onfido’s proprietary technology into its digital application system.

    The new solution not only eliminates the needs for certified physical copy documents and saves time, but also it makes the mortgage application process easier for both brokers and their clients

    Plans are also being considered to add Onfido technology into the onboarding process used for LendInvest’s online investment platform in the future.

    UK Peer to Peer Lender Lending Works Raises £2.8 Million in New Funding Round (Crowdfund Insider) Rated: A

    Lending Works has received £2.8 million in funding in a round led by Maven Capital Partners, with £800,000 of backing from Pollen Street Capital and NVM Private Equity. The UK peer to peer lender said proceeds will be used to fuel growth including loan customer acquisition via other channels.

    Founded in 2014, Lending Works has originated approximately £115 million in loans with £32 million (27%) in the first half of 2018. – 27% of which (£32 million) was distributed in the first half of 2018 alone. Lending Works expects to originate £100 million in loans during 2018. The P2P lender is also a member of the UK Peer to Peer Finance Association (P2PFA) – the association that represents leading P2P platforms.

    Another robo-adviser enters the fray: Tiller lets you invest in passive AND active funds – so how does it compare? (This is Money) Rated: A

    Another player has entered the increasingly crowded ‘robo-advice’ space to cater for modest investors who have been priced out of conventional financial advice.

    The new service, called Tiller, will pit against the likes of Nutmeg and Moneyfarm in a bid to win the custom of those investing smaller amounts who are under-served by financial advisers.

    Like many of its competitors, Tiller creates a personalised portfolio which is rebalanced if necessary, buying and selling depending on what the markets do.

    China

    There’s No Subprime Bubble in China Auto Loans (Bloomberg) Rated: AAA

    Slowing car sales and tightening credit look like a toxic combination for China’s auto-financing industry, which has exploded in the past few years. Concerns the sector is heading for a subprime-like meltdown may be overblown, though.

    Sales in the world’s largest car market rose 2.3 percent in June from a year earlier, data showed last week. While faster than several analysts expected, growth decelerated from an 8 percent pace in May. Compared with the previous month, deliveries fell about 1 percent in June.

    The cooling coincides with Beijing’s quest to deleverage the financial system, which has led to tighter liquidity, reduced access to credit and, in theory, squeezed consumer discretionary spending. In a report last week, analysts at Sanford C. Bernstein linked the weakness in car sales to a slowdown in peer-to-peer lending, pointing to “the deflation of what amounts to a subprime (P2P) auto bubble.”

    Source: Bloomberg

    Chinese Fintech Platform Duanrong.com Raises $ 45M Series B Round (China Money Network) Rated: AAA

    China Money Network’s DealShot provides detailed information on venture capital and private equity deals in China on a daily basis.

    Here you can find out where Chinese investors have been investing their money each workday.

    Company Round Lead Investor Participants Sector Headquarters
    Duanrong.com Series C Lanua Asia fund Fintech Beijing
    LemonBox Seed Round Y Combinator, Guangjian Lab E-commerce Beijing
    58 Suyun Series A InnoVision Capital Cainiao Network, Russia-China Investment Fund (RCIF), Qianhai Fund of Funds, 58 Daojia Logistics Tianjin
    Honor Alliance Series A Angel Around Investment Fund Enterprise services Beijing
    ASR Microelectronic Series B IDG Capital, Wanrong Hongtu Fund Smart Hardware Shanghai
    Hash World Series A+ Shunwei Capital Danhua Capital Blockchain Beijing
    EON Protocol Angel Round UpHonest Capital, BGOGO, Fission Capital Blockchain
    Paopao Hero Series A undisclosed Consumer Upgrade Guangzhou
    Haowujiayi Pre-A undisclosed E-commerce Shenzhen
    51signing.com Series A Fenbushi Capital, DL Capitals Enterprise services Beijing
    Viva Vision Biotech Series B Healthcare Shanghai
    iBanker Pre-A Button Capital Mindfulness Capital, AC Capital Education Beijing
    Soushi88.com Series A Ferry Venture Capital Buhuo Ventures E-commerce Guangzhou
    IPSTAR Pre-A miHoYo Volcanics Venture, Shenzhen Huode Qianhai Fund Management Co., Ltd Media & Entertainment Shanghai
    Huaqiang PCB Series B Cowin Capital, China Merchants Bank E-commerce Shenzhen

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

    Toutiao Marches into the Fintech Market with Cash Loan Products

    China’s leading digital media platform Toutiao has long denied the potential of entering the financial markets. However, it is reported this week that a series of cash loan products have launched on Toutiao’s app without too much marketing.

    The product Fangxinjie (literally meaning reliable lending) was listed within Toutiao’s digital wallet with credit up to200,000 yuan and daily interest low to 0.03%.

    Fintech Startup xyb100 Secures ¥200 Million B Round Funding led by Japanese Financial Institution Credit Saison

    This week, fintech startup xyb100 announced that it had secured 200 million B round funding by famous Japanese financial institution Credit Saison.

    European Union

    Fundvisory Raises €1.8M From Macif and Aviva France (Coverager) Rated: AAA

    Fundvisory, the Paris-based startup that offers a white-label robo-advisory solution has raised 1.8 million euros from Aviva France and Macif.

    Founded in 2015, Fundvisory provides automated and modular robo-advisory tools such as portfolio monitoring, risk profiling and compliance to help financial institutions digitize their financial advisory services. Led by Nicolas Gonzalez and Romain Deguest, the startup previously raised 300,000 euros from friends and family, and is currently a team of 10 according to LinkedIn.

    India

    RBI Grants NBFC-P2P Certification to Cashkumar (Silicon India) Rated: AAA

    According to a recent Morgan Stanley report, Indian P2P lending industry is estimated to cross the $4 billion mark by 2021. Owing top such pleasing industry forecast, along with the additional support schemes & initiatives from the Government, the fintech players in India have garnered a lot of momentum. In this light, Cashkumar, one of India’s leading P2P lending companies, announced that it has been granted the NBFC-P2P license from RBI (Reserve Bank of India). With this, Cashkumar joins the list of the very few fintech firms who hold the NBFC-P2P accreditation. Post this, the company focuses on providing loans between  20,000-100,000 with tenures of 3-12 months and offering only to salaried individuals.

    Asia

    Japanese startup Paidy raises $ 55M Series C to let people shop online without a credit card (Tech Crunch) Rated: AAA

    Paidy, a fintech startup that enables Japanese consumers to shop online without using a credit card, announced today that it has raised a $55 million Series C. The round was led by Japanese trade conglomerate Itochu Corporation, with participation from Goldman Sachs.

    The Tokyo-based startup says this brings its total funding so far to $80 million, including a $15 million Series B announced two years ago. One notable fact about Paidy’s funding is that it’s raised a sizable amount for Japanese startup, especially one with non-Japanese founders (its CEO and co-founder is Canadian and Goldman Sachs alum Russell Cummer, left in the photo above with CTO and co-founder Lee Smith).

    Bambu raises $ 3m in Series A funding (FinTech Futures) Rated: A

    Bambu CEO and founder Ned Phillips says it has topped growth targets for the year, and points to seven new clients in Asia and the US that were slated to go live soon.

    He adds: “Our next ambitious goal is to get a million end users on the platform by 2019.”

    Also participating in the round were Singapore family office Octava and Japanese fintech investor Mamoru Taniya.

    The funding takes Bambu’s total capital to more than $4 million.

    Lendr wins Asian award for innovative partnership (Manila Standard) Rated: B

    Lendr, the digital lending platform of FINTQnologies Corp., bagged the ‘Most Innovative Partnership Strategy’ award at the 21st Annual Telecom Asia Awards on June 26 in Singapore.

    MENA

    Generation Start-up: Smart Crowd helps micro-investors build wealth, brick by brick (The National) Rated: AAA

    In the case of Smart Crowd, the platform enables fractional ownership of real estate. Investors can purchase a stake in a rental property for as little as Dh5,000 ($1,300), ‘co-owning’ the asset along with tens, hundreds (or thousands, depending on the size and value of the unit) of other people.

    They can hold their stake for as long as they wish, collecting the rent from it, or sell it and use the proceeds to invest in something else listed on the platform. Or they can use accumulated returns to buy a property on their own.

    Smart Crowd is licensed by the Dubai Financial Services Authority, the regulator of Dubai International Financial Centre, Dubai’s financial free zone, to provide crowdfunding services for real estate. It won regulatory approval in January, obtained an operating licence in April, and in June completed its first transaction – the acquisition of a Dh365,000 studio in Remraam generating a gross annual yield of 10.8 per cent (approximately 8.6 per cent with fees), the founders say.

    Big data for bigger opportunities (Khaleej Times) Rated: A

    Businesses in Dubai are not sparing any efforts to tap possible avenues to boost sales and growth, and the latest trend is that firms specialising in big data are unlocking opportunities to study customer preferences, loyalties and any segment that will help boost customer numbers.

    Big data is a term that describes the large volume of data – both structured and unstructured – that inundates a business on a day-to-day basis. But it’s not the amount of data that’s important: it’s what organisations do with the data that matters. Big data can be analysed for insights that lead to better decisions and strategic business moves, according to the definition given by SAS Institute.

    Authors:

    George Popescu
    Allen Taylor

    Digital Banking 2018

    Digital Banking 2018

    Date: June 6-8, 2018 Location: The Neal Kocurek Memorial Austin Convention Center 500 E Cesar Chavez Street, Austin, TX 78701 Digital Banking is the leading and largest digital banking event in the industry, covering innovation in financial services for consumer and commercial customers around mobile, digital, AI, payments, RegTech, data, blockchain, API, channel and technology strategies. […]

    Digital Banking 2018

    Date: June 6-8, 2018

    Location: The Neal Kocurek Memorial Austin Convention Center
    500 E Cesar Chavez Street, Austin, TX 78701

    Digital Banking is the leading and largest digital banking event in the industry, covering innovation in financial services for consumer and commercial customers around mobile, digital, AI, payments, RegTech, data, blockchain, API, channel and technology strategies.

    Featured Speakers include:

    • Lisa Adams, Product Marketing Manager, Avoka
    • Duangporn Aphiraksatyakul. VP of Enterprise Risk Analytics, Bank of America
    • Dan Armstrong, Chief Digital Officer, BankMobile
    • Amir Ben-Efraim, Co-Founder and CEO, Menlo Security
    • Lisa Cook, Product Manager for the Digital Banking channel, FirstBank
    • Keith Costello, CFA, President and CEO, First GREEN Bank
    • Parker Crockford, Commercial Director US, Onfido
    • Jennifer Daugherty, Senior Vice President and Director, Omnichannel Strategy, Fifth Third Bank
    • And many more

    Register here.

    Wednesday November 29 2017, Daily News Digest

    Qudian

    News Comments Today’s main news: Fiduciary rule delayed–again.SoFi prepares sixth student loan refinance ABS.LendingTree secures $250M amended, restated credit facility.Indonesian tech investments hit $3B YTD. Today’s main analysis: Qudian bounces back. Today’s thought-provoking articles: Will Mulvaney back consumers or payday lenders?American consumers say financial crisis had no impact on their lives.Online education startup promises to […]

    Qudian

    News Comments

    United States

    United Kingdom

    China

    European Union

    International

    India

    Asia

    News Summary

    United States

    DOL Officially Delays Start of Fiduciary Rule (The National Law Journal), Rated: AAA

    The Labor Department on Monday announced the official 18-month extension for the start of key provisions of the fiduciary rule.

    President Donald Trump directed the Department to prepare an updated analysis of the “likely impact” of the fiduciary rule on access to retirement information and financial advice.

    The extension will be published in the Federal Register on Wednesday.

    SoFi readies sixth student loan refi ABS (GlobalCapital), Rated: AAA

    SoFi is has entered the post-Thanksgiving pipeline with its sixth student loan refinancing transaction this year, in line with its plans to issue 12 securitizations in 2017.

    The California-based online lender filed documents with the US Securities and Exchange Commission on Tuesday. Credit Suisse, Goldman Sachs, Bank of America Merrill Lynch and Morgan Stanley are banks on the deal, according to the deal documents.

    SoFi Tackles Consumer Debts in New Ad Push (Lend Academy), Rated: A

    While relaxing over the Thanksgiving weekend you might have noticed a new trend occurring in television while watching the games: six second ads.

    SoFi is focusing their message on the consumers lifestyle, presenting an understanding as to why someone needed to increase their credit card debt.

    They also placed a Black Friday circular with several national newspapers which you can see in the photo below. The ad is a clever take on the typical sales fliers we all see around this time of year. But instead of an ad featuring low prices we see an ad touting much higher prices. The message is that if you are buying gifts on credit cards this holiday season and carrying a balance you will be paying a lot more than the advertised price. It is a message focused on smart spending, giving a better look at the true costs of products when financed.

    Would Trump’s CFPB Pick Mulvaney Back Consumers Or Payday Lenders? (International Business Times), Rated: AAA

    Demonstrators gathered outside the Consumer Financial Protection Bureau (CFPB) in Washington D.C.  Wednesday to protest President Trump’s decision to appoint White House budget director Mick Mulvaney to director of the agency.

    As a Congressman, Mulvaney accepted $55,500 in contributions from payday lenders during his four successful runs for Congress, including $26,600 during the 2016 election cycle,  according to the National Institute on Money in State Politics. Before he was tapped to lead President Donald Trump’s Office of Budget Management, Mulvaney took $115,200 from the securities and investment industry, and another $96,564 from the insurance industry in the 2016 cycle, both more than any other industry, according to the Center for Responsive Politics. This record, along with comments Mulvaney made indicating he would shutter the agency if given the opportunity, has led critics to question whether Mulvaney’s priority will be consumers — or the companies the agency is responsible for regulating.

    Payday lenders appear to want Mulvaney to lead the CFPB.

    Note to Mick Mulvaney: Donuts do not a CFPB director make (The Washington Post), Rated: A

    President Trump’s hostile takeover of the Consumer Financial Protection Bureau, by contrast, relies on the rather less cherished legal principle of habeas cuppedia, Latin for “you shall have the pastries.”

    Under the statute that created the CFPB, the watchdog agency set up after the 2008 crash to police lending abuses, it should now be rightfully run by Leandra English, the deputy director who succeeds the just-resigned director, Richard Cordray, until the Senate confirms a permanent replacement. Trump found another statute that he says lets him appoint Mulvaney. English filed suit to defend her legitimacy, Mulvaney submitted doughnuts, and a Trump-appointed federal judge, to nobody’s surprise, ruled in Trump’s favor.

    Ten Years Post-Financial Crisis and Americans Say It Had No Impact, According to Hartford Funds Survey (BusinessWire), Rated: AAA

    New data released today by Hartford Funds revealed that a decade after the Great Recession, Americans are unclear how the economic event impacted their life and financial behavior.

    The majority (40 percent) of respondents said that the financial crisis had no impact on their life, yet large numbers reported that they avoid the market (42 percent) and have altered their spending and savings habits (46 percent). Others (26 percent) shifted their retirement timeline and plan to work longer then they’d hoped, and 25 percent had to change jobs or take on additional jobs.

    The majority (40 percent) of respondents said that the financial crisis had no impact on their life, yet large numbers reported that they avoid the market (42 percent) and have altered their spending and savings habits (46 percent). Others (26 percent) shifted their retirement timeline and plan to work longer then they’d hoped, and 25 percent had to change jobs or take on additional jobs.

    STRATEGIC ADVANCES IN THE USA FUEL MONEVO’S GROWTH (BQLive), Rated: A

    The company’s growth is set to continue with ongoing success in the US, Monevo’s newest territory.

    Personal loan originations in the US reached new heights by the end of 2016. Total balances reached $102bn for the first time, $14bn higher than the end of 2015. The number of consumers with personal loans at the end of 2016 was 15.82 million.

    Fifteen US lenders, including Lending Club, Sofi, and Prosper have joined Monevo’s roster of over 150 personal loan lenders across the world.

    GETTING STUDENT FINANCIAL AID MAY BECOME WAY EASIER WITH NEW FAFSA APP (Newsweek), Rated: A

    Just like Uncle Sam, Education Secretary Betsy DeVos wants you…to be able to apply for financial aid on your phone.

    DeVos said Tuesday that the government plans to launch an app for the Free Application for Federal Student Aid, or FAFSA, which some 20 million people fill out every year in hopes of getting grants, loans and other money for college or career training. It’s all part of a plan to make the FAFSA much simpler to submit.

    HouseCanary Announces $ 31 Million Series B Funding, Comprised of PSP Growth and Existing Investors (HouseCanary), Rated: A

    HouseCanary, the data analytics and valuation platform for real estate professionals, today announced it has closed a $31 million series B funding round, bringing the company’s total funding to $64 million to date. Investors in the round include PSP Growth, the venture and growth equity arm of PSP Capital, a private investment firm founded by entrepreneur and former Commerce Secretary Penny Pritzker, as well as Alpha Edison and other existing investors.

    Investors can now value over 100 million properties with a median error of 2.5% or less. Lenders and appraisers use HouseCanary technology to reduce the time it takes to complete an appraisal from more than 25 days to less than a week.

    Your Sneak Peak of the LendIt Fintech USA Agenda (LendIt), Rated: A

    Fintech

    How secure is your data? Recent hacks and breaches have re-stressed the importance of the data security and customer information. This track will help young startups and big box financial institutions verify customers, understand data security and utilize tools to improve efficiency. The future of technology is in robotics, machine learning and biometrics, not grasping these changes will make your business extinct.

    BlockFin Summit

    Bitcoin. Blockchain. Cryptocurrencies. ICO’s. Everyone’s talking about them, but how will these new age concepts change the future of money?

    Digital Banking

    Banks are looking to fintech partners to transform their business for the digital revolution. This track will explore the crucial role of mobile banking, smart ATM innovations, chatbots’ role, and the digital transformation at all levels—from branch to infrastructure to data storage.

    Lending

    Learn how to scale your growth like Lending Club, increase access to credit like LendingPoint, and utilize mobile-only technologies like MoneyLion.

    Source: LendIt

    The secret to reeling in cybersecurity talent at three big banks (American Banker), Rated: B

    There will be 3.5 million unfilled cybersecurity jobs by 2021, up from 1 million last year, according to the research firm Cybersecurity Ventures. Meanwhile, Frost & Sullivan estimates 1.8 million cybersecurity jobs will go unfilled by 2022, a rise of around 20% since 2015.

    The military is skilled at producing what Gary McAlum, the chief security officer at USAA, calls “Jedi Knights.”

    Wells Fargo is making a big push to hire veterans, said Rich Baich, its chief information security officer. He has held several positions in the Navy, the North American Air Defense Command, the National Reconnaissance Office and the FBI.

    As of August more than 8,500 veterans worked at the San Francisco bank, and at any given time it has 200 team members on active duty.

    United Kingdom

    LendingTree Enters into a $ 250 Million Amended and Restated Credit Facility (PR Newswire), Rated: AAA

    LendingTree (NASDAQ: TREE), a leading online loan marketplace, announced today it has entered into an amended and restated $250 million five-year senior secured revolving credit facility that will replace LendingTree’s previous $125 million credit agreement.  The amended and restated revolving credit facility provides increased borrowing capacity and improved pricing, along with greater strategic and operational flexibility. The facility can be used to finance working capital needs, permitted acquisitions, capital expenditures, and general corporate purposes.

    The amended and restated revolving credit facility will be governed by a maximum net leverage covenant of 4.50x, with step downs to 4.00x over time. Additionally, the amended credit facility contains an accordion feature under which the borrowing capacity can be increased by $100 million or a greater amount, subject to certain conditions.

    Why a blockchain startup called Govcoin wants to ‘disrupt’ the UK’s welfare state (MENAfn), Rated: A

    The UK chancellor’s recent Budget reminded us that systemic problems continue to plague the government’s delayed roll-out of universal credit – a single monthly welfare payment that will replace six separate benefits.

    Govcoin, intent on ‘disrupting’ welfare state provision, has been working with the Department for Work and Pensions (DWP) since early 2016 to develop a solution for welfare payments.

    ‘Claimants can – voluntarily – download an app, which enables them to create virtual jam jars and apportion money to them. Whether that’s ‘rent’, ‘gas and electric’ – it’s entirely up to them,’ said Kay in an last autumn.

    Govcoin will financially empower benefit claimants. But its distribution model involves benefits being paid – not in pounds and pence – but in the form of a cryptocurrency similar to . Govcoin promises to allow claimants to pay for goods and services – such as utilities – linked to the system.

    Peer-to-peer Bitcoin lending fund launches (P2P Finance News), Rated: A

    Called Bond, the fund lets accredited investors buy securities known as “Bond Units” in an asset portfolio that holds a mixture of property bonds, real estate and cryptocurrency assets.

    Each Bond Unit, which digitally represents an equity share of Bond’s asset portfolio, will be issued on the Bitshares Blockchain and traded via the Bitshares decentralised exchange.

    The portfolio has 30 per cent exposure to P2P Bitcoin lending; 30 per cent to property bonds and real estate; and 30 per cent to digital currency learning website the Billion Hero Campaign. The remaining 10 per cent is invested in alternative cryptocurrencies.

    China

    Banker Bulls Still Like Qudian, Despite China’s Crackdown (Barron’s), Rated: AAA

    After losing more than 40% of its market value last week — as Chinese regulators tightened rules for online consumer lending — Qudian is seeing a 16% bounce today in its American depositary receipts (ticker: QD), to a recent $14.

    Source: Barron’s

    China’s fintech is still in its infant phase (TechNode), Rated: A

    One of the Chinese fintech players that made their way to the US public market is Rong360 Inc’s Jianpu, an online platform for discovery and recommendation of financial products. The founder and CEO Ye Daqing recently joined its investor James Mi, founding partner of Lightspeed China Partners, on stage at TechCrunch Shanghai to discuss why the fintech is booming in China and what opportunities lie ahead.

    There are many fintech companies that are quite controversial because some of them have damaged the reputation of the market. But two of the [fintech] companies you invested in have both filed for an IPO recently. James, what’s your view [on the market]? What makes you such a good investor, landing two IPOs?

    Mi: Lightspeed mostly invests in early-stage companies. We usually look at their development in 3-5 years down the road.

    We were actually very prudent about P2P. When we finished looking at all the companies we ended up choosing PPDAI because it was offering a real online solution. No offline sales. And this type of business contributes to the society.

    Why are so many Chinese [fintech] companies going IPO in the US recently?

    Ye: China will see ten to twenty years of significant growth in fintech and micro-finance. The level of digitalization of finance in China is much lower than that of e-commerce, which took more than ten years to reach 14%. Digital finance is currently at less than 5% penetration. In four to five years, or even longer, fintech will surpass retail. For example, lending, car mortgage, credit cards, and insurance.

    Let’s look at another buzzword, that is artificial intelligence (AI). Every single industry nowadays is talking about AI. What will happen when AI meets fintech? 

    Ye: The financial industry is actually a data industry, wholly relying on data to make risk control decisions and take care of customer service and marketing. Take our platform for example—it has nearly 70 million registered users, more than 2,500 partnered financial organizations, with 170,000 types of products, and each product is facing a changeable set of challenges and varying user behavior.

    European Union

    Nutmeg and Revolut investor launches new European fund (AltFi), Rated: A

    A leading investor in Series A-stage technology companies, Balderton Capital has closed a total of $375m in its latest fund with a new generation of European tech in its sights.

    Flender’s lenders throw €400,000 towards €2m funding round (SiliconRepublic), Rated: A

    Dublin fintech Flender is hurtling with fierce velocity towards a funding round worth more than €2m, with involvement from some of its customers, who have already pledged €400,000.

    “Initially, we offered €100,000 to them but this quickly overfunded and we increased this to €400,000.”

    International

    An online education startup thinks it can save bankers from losing their jobs to machines (Quartz), Rated: AAA

    The attack on banking jobs has been relentless. British banks are set to close almost 800 branches this year, after shutting nearly 600 in 2016. The CEO of Deutsche Bank, Germany’s largest bank, warned that the company could afford to lose half of its staff to automation. Swiss bank Nordea announced at the end of last month that it was cutting a tenth of its staff, and its CEO said the banking industry could cope with half its current number of personnel. Consultancy Greenwich Associates estimates that 15% of the finance industry’s jobs are at risk of being lost to AI-driven alternatives.

    In addition to teaching, Nguyen Trieu is leading by example with the launch of an AI-enabled mobile savings app, which is in the early planning stages.

    But there’s a big difference in fintech scenes across the world.

    The mindset and the way people use technology and fintech is very different. If you’re in Hong Kong, you have WeChat on your phone and you use it on a daily basis. Here, you don’t use fintech on a daily basis. Some people might use Revolut but they still have a traditional bank account. Here, fintech is seen as innovations on top of existing financial services whereas in Hong Kong, fintech is finance.

    So the course is for everyone, everywhere?

    And not just for people in finance. When we did the beta test only 40% of the users were from the finance industry—the rest were from tech, or were entrepreneurs or consultants.

    So automation, AI, machine learning, and the like are all coming for your job if you don’t retrain?

    Banks are thinking today about cutting thousands of jobs and increasing their technology budgets. To me, it is is absurd for a CEO of a bank to think this way.

    So, what finance jobs most at risk right now?

    In general, anything that can be automated will be automated. But right now, compliance is at risk. Over the past few years there’s been a lot of investment in compliance and KYC [know your customer], because regulators wanted the investment and it was a way for banks to demonstrate they were doing their part after the financial crisis. Now, that has totally changed. It’s starting to cost a lot and regulators have said we want you to show that you are being efficient, not just hiring a lot of people.

    Exclusive Interview with Bloom Co-Founder Jesse Leimgruber (ChipIn), Rated: A

    Bloom is a global decentralized credit scoring system available to anyone – even the unbanked and underbanked. Bloom’s flexible ecosystem will allow users to have access to credit services which work globally and are extremely secure and transparent thanks to the blockchain’s inherent features.

    First off, why did you decide to use the blockchain in building Bloom? 

    People shouldn’t be forced to rebuild credit from scratch when they move to a new country. Billions of people around the globe are still considered “credit unscorable,” forcing them into taking out dangerous, informal loans.

    To make matters even worse, many governments generate credit scores based on religion, political affiliation, and voting status, instead of data. Even in the United States, 45 Million Americans (including many financially savvy millennials) still do not have a credit score.

    What do you think is the biggest problem Bloom will solve and why is the problem important to solve?

    3 Billion people cannot access credit, largely due to artificial restrictions from governments.
    Tell us more about how BloomID works behind the scenes. The most interesting part about is the vouching process; how does this work and how does Bloom ensure that vouches are not manipulated or faked in any way?
    BloomID is the Bloom protocol’s method of both establishing a reliable identity as well as forming the basis of creditworthiness for users who are newly entering the Bloom network. BloomID allows organizations who store information about individual identities to attest to the identity of a Bloom user and mark that information on the blockchain for future re-use. A user’s friends, family, and peers can help an individual bootstrap creditworthiness by vouching for their ability to act responsibly with credit. This is like a reference, similar to co-signing.

    Is Bloom already working with notable businesses or firms? Are there any future partnerships in process? If yes, can you explain briefly about it?

    We’ve been in touch with 100’s of lenders and partners. We’ve announced quite a few. Peer to peer lending, traditional fiat businesses, crypto lenders… we’re working with people on the whole spectrum.

    For example: Self Lender is a credit building lender we are working with, Everex, Lendoit, and ETHLend are crypto lenders. We’re working with partners for anti-fraud such as TypingID.

    Download the Bloom white paper here.

    Exclusive Interview with ETHLend CEO Stani Kulechov (ChipIn), Rated: A

    ETHLend is a Decentralized Lending Innovation using the Ethereum platform as its base.

    First off, why did you decide to use the blockchain in building ETHLend?

    Finance is where blockchain technology was conceived, and it is in finance that blockchain technology is arguably most transformative. It intrinsically offers greater visibility, scalability, and efficiency – and potentially at a lower cost.

    By providing a means of authorizing fully trackable and verifiable transactions, it also offers the potential for truly open-source many-to-many lending. Presented in these terms, it may well seem like a threat to peer-to-peer firms. If blockchain removes the need for marketplaces, why should borrowers and lenders pay fees to these platforms? ETHLend promotes less fees, transparency, and integrity amongst borrowing and lending.

    What do you think is the biggest problem ETHLend will solve and why is the problem important to solve?

    In today’s world, you are at the mercy of banking institutions for borrowing and lending. We all know the bank pays out minimal interest on investment accounts and charges maximum interest on borrowing. We have partnered up with Bloom who provides credit scoring capabilities so both borrower and lender build a reputation amongst the ETHLend community which is usable elsewhere on the blockchain.

    Why do you think the shift from traditional lending to P2P lending is happening right now?

    Market research tells us that there are countries at the moment which are paying from 0.5 to 5 percent. For example, here in Finland, it is quite common to have a secured mortgage loan with an interest of 0.4 to 0.8 percent on bank’s marginal. On the contrary, In Brazil, the interest rate tops to 32 percent and Russians pay on average of 11 percent and in India 10 percent (take note that today’s numbers may differ).

    The differences in interest rate mean that with a higher interest rate, people and businesses have less access to finance.

    Source: ChipIn

    Alternative investment LPs want more transparency and co-investment opportunities (HedgeWeek), Rated: A

    More than 140 LPs responded to the survey, of whom approximately 52 per cent were based in North America, 31 per cent in Europe and 15 per cent in Asia Pacific. Nearly one quarter (22 per cent) were public pension plans, 15 per cent were consultants and 13 per cent were either endowments or family offices.

    Intralinks is a leading financial services company with over USD31 trillion of transactions executed on its platform and over four million users. It has the largest community of GPs and LPs and is used by over 1,000 private equity, real estate and hedge funds on a daily basis. Over USD1 of every USD2 raised globally for private equity was facilitated using Intralinks for a total of USD317 billion in 2016 and 13 out of the 20 largest funds were raised on its platform.

    More than one third of investors confirmed that their current allocation was more than 30 per cent, with nearly two thirds confirming that they planned to increase their allocation to alternatives over the next 12 months by 1 to 10 per cent.

    Gold, Silver Storage & Lending For Hard Assets in the World’s Safest Jurisdiction (Palisade-Research), Rated: A

    Gregor discusses Silver Bullion SG a company he started in Singapore where individuals can securely store their gold and silver. They just hold your precious metals and validate their authenticity. They do this without counterparty risk as your assets are marked, segregated and you hold the title. The company holds over 230 million in hard assets.

    Using peer to peer lending you can withdraw up to half of your holdings in loans at low-interest rates.

    GoCardless Tops Juniper Leaderboard for Fintech: A Sector Worth More Than 0 Billion in 2018 (BusinessWire), Rated: B

    A new study from Juniper Research ranks GoCardless as the current clear leader in the fintech market. GoCardless enables simple payment processing and integration with many popular services, and Juniper believes that its potential for efficient, borderless commerce is disruptive and far-reaching.

    Juniper’s Fintech Leaderboard Ranking

    1. GoCardless

    2. Onfido

    3. Square

    4. Lemonade

    5. Kabbage

    India

    CROWDFUNDING SET TO GROW (Daily Pioneer), Rated: AAA

    Crowdfunding activity in India is driven increasingly by mobile applications and payments. This trend is likely to witness exponential growth.

    Rs 300 crore, the Indian crowdfunding industry is at a nascent stage compared to the global standards with the total amount of money raised via crowdfunding in 2016 at USD 738.9 million.

    Asia

    Investment in Indonesian tech start-ups reaches $ 3bn year-to-date (Oxford Business Group), Rated: AAA

    Indonesia’s tech start-ups have been catching the eye of investors, having raised close to $3bn in funding in the year to September 13, a substantial increase on the $631m received in 2016.

    Chinese firms are prominent among the foreign investors in Indonesia’s start-up boom, according to research firm CB Insights: Alibaba committed $1.1bn to online marketplace Tokopedia in August, and in May JD.com and Tencent Holdings invested $1.2bn in ride hailing motorbike service Go-Jek, which utilises mobile payment services.

    Alternative financing posts 1462% growth

    Last year Indonesia posted one of the highest growth rates in the Asia-Pacific region in alternative finance activity. The segment’s total market size expanded by 1462% to $35.4m, according to a report by the University of Cambridge, Monash University and Tsinghua University published at the end of September.

    The study found that peer-to-peer (P2P) business lending had come to dominate Indonesia’s alternative finance market, accounting for just over 60% of the 2016 total, with P2P consumer lending representing 18% of the figure, or $6.5m.

    Fostering collaboration and growing market opportunities

    Indonesian tech start-ups attracted the second-highest amount of investment in South-east Asia between 2012 and September 13, at $4.6bn, behind Singaporean companies, which raised $7.3bn over the same period.

    Fintech Challenge seeks to bolster financial inclusion in Vietnam (Nhan Dan), Rated: A

    A programme entitled ‘Fintech Challenge Vietnam’ has been launched by the State Bank of Vietnam (SBV), with the aim of fostering innovation in financial services that promote greater financial inclusion in Vietnam.

    Fintech Challenge Vietnam has been organised by the SBV with the support of the Mekong Business Initiative and sponsorship by the Vietnam Bankers Association and the Vietnam Fintech Club.

    VN Central Bank launches first-ever fintech challenge (VietnamNet), Rated: B

    The focus of the Fintech Challenge is on fintech solutions that can improve the offer of financial services to the underserved and unbanked.

    The challenge is an opportunity for Fintech companies from both inside and outside Việt Nam who are interested in collaborating with commercial banks to pilot and scale solutions that improve financial services in the following categories: electronic payments, e-KYC (Know Your Customer)/e-Identification, open APIs, blockchain and peer-to-peer lending to apply.

    The deadline for application is January 18, 2018, at fintech.mekongbiz.org.

    OJK to issue new fintech regulation in March (The Jakarta Post), Rated: B

    The Financial Services Authority (OJK) aims to issue a regulation on financial technology (fintech) businesses by March next year amid robust development of the industry, OJK deputy commissioner Nurhaida said Tuesday.

    Authors:

    George Popescu
    Allen Taylor

    Friday September 29 2017, Daily News Digest

    C-PACE financing

    News Comments Today’s main news: LendingClub completes 2nd self-sponsored loan securitization with $323M deal. Funding Circle restates IPO ambitions. Robo.cash tops 2M Euro, 1000th investor. AutoGravity surpasses $1B USD in finance amount requested. Singapore banks closing cryptocurrency, payments accounts. Today’s main analysis: Risk evaluation of commercial PACE securitizations differs from residential deals. Goldman Sachs’ aggressive push into consumer banking. Today’s […]

    C-PACE financing

    News Comments

    United States

    United Kingdom

    China

    European Union

    International

    Australia

    India

    Asia

    News Summary

    United States

    LendingClub Completes 2nd Self Sponsored Loan Securitization with $ 323 Million Deal (Crowdfund Insider), Rated: AAA

    LendingClub (NYSE: LC) has sponsored and contributed to its second securitization deal following the the last successful self sponsored deal this past June. The “Consumer Loan Underlying Bond” (CLUB) Credit Trust 2017-P1 (CLUB 2017-P1) issued $323.1 million in prime notes backed by consumer loan assets originated via the LendingClub platform. This is the sixth securitization supported or sponsored by LendingClub, and the fourth rated securitization of LendingClub facilitated loans overall. LendingClub described the deal as further expanding investor access.

    LendingClub reported the transaction was backed by approximately $350 million of collateral and includes $217.3 million of Class A notes rated “A-(sf)”, $51.0 million of Class B notes rated “BBB (sf)” and $54.7 million of Class C notes rated “BB (sf)”.

    Orchard’s Online Lending Ecosystem Update: “Lendscape” (Crowdfund Insider), Rated: AAA

    Orchard Platform, the nexus of loan originators and institutional investing, has updated their ongoing graphical view of the online lending  world or “Lendscape”.  As the online lending universe has moved from peer to peer lending, to marketplace lending to all forms of online lending, the Lendscape has changed and grown. New lending platforms have been launched, new verticals targeted, and a growing number of ancillary services have joined the space.  Orchard points to the addition of lenders like LendingPointLiberty LendingLendmartAllegro CreditUpLiftArtMoneyAscendOppLoans, and Lendistry.

    Perhaps the most important shift in online lending is the growing participation by traditional finance firms.

    Source: Crowdfund Insider

    Risk Evaluation of Commercial PACE Securitizations Differs From Residential Deals (Morningstar), Rated: AAA

    Morningstar Credit Ratings, LLC believes the next iteration of property assessed clean energy securitizations will be in the commercial sector. While securitization of residential PACE assessments tops $3 billion, there have been no public transactions consisting primarily of commercial liens.

    Evaluating Property Income Generated to Pay Debts In analyzing the credit risk of transactions backed by commercial assessments, Morningstar considers the debt service coverage ratio, because PACE lending is tied to the property rather than the owner’s creditworthiness.

    Evaluating Property Income Generated to Pay Debts

    Morningstar evaluates a property’s net operating income in relation to its annual debt-service payments. Among securitized commercial mortgages, the average DSCR is approximately 2.14x, according to Morningstar. C-PACE lenders and aggregators typically require a minimum total DSCR in the 1.00x to 1.15x range. Although, in some cases, the DSCR has dipped below 1.00x, especially if total debtto-value is low when operating expenses are higher than revenue. Factors possibly mitigating a lower DSCR, which include county support, property ownership affiliations within a network, liquidity account and equity position require case-by-case analysis. In addition, DSCR of the lien is more important than the DSCR of the overall debt.

    Evaluating Divergent Leverage Metrics

    The lien-to-value ratio is another leverage metric that Morningstar analyzes. Although a PACE assessment raises a property’s lien-to-value ratio, the increased risk to the underlying mortgage is likely minimal, as the obligation is usually small in comparison to the mortgage.

    It can be more challenging to calculate the lien-to-value ratio for C-PACE levies, because the properties can run the gamut from hotels, farmlands, nursing homes, and gas stations to nonprofit buildings such as churches. Across residential PACE deals, we have seen lien-to-value ratios around 6.7% and combined PACE-lien-plus-mortgage-tovalue ratios at around 62.7%. In C-PACE, lien-to-value ratios hover around 25.0%, not including mortgage debt.

    While we scrutinize total debt-to-value, the distribution of leverage offers insight into the financial health of the property. For example, we view a property with a 90% debt-to-value ratio that is composed of an 89% mortgage loan and a 1% PACE assessment more favorably than a property whose debt is composed of an 89% PACE obligation and a 1% mortgage because of higher subordination levels.

    Growing Market Size

    C-PACE financing has grown to about $482 million as of Sept. 1, encompassing 1,097 commercial projects, according to PACENation. More than 2,500 municipalities have C-PACE programs.

    Compared with residential programs, C-PACE is in its infancy, as R-PACE financing totaled about $3.67 billion and R-PACE securitizations totaled around $3.40 billion. A sliver of
    commercial assets was included in one of those securitizations, GoodGreen 2016-1, with commercial PACE levies representing approximately 4.8% of the pool’s assets.

    Source: Morningstar

    Get the full report here.

    The Top Sources Of Small Business Financing Based On Approval Rates (Forbes), Rated: AAA

    According to the latest Biz2Credit Small Business Lending Index, the monthly analysis of more than 1,000 small business loan applications on Biz2Credit.com. Loan approval percentages of institutional investors have continuously reached new heights this year in terms of approval rates. In August Institutional lenders’ loan approval rates in August reached 63.9%.

    Alternative lenders’ approval percentages continue to decline; in August the rate dipped to 57.1%. Approval percentages have dropped every month for more than a year.

    Approval percentages at small banks rose one-tenth of a percent in August to 49.0% from July’s 48.9% figure. It is conceivable that the number may cross the 50% benchmark.

    Big banks improved one-tenth of a percent to 24.6% in August, setting a new high for the Biz2Credit Index, which has tracked loan approvals since January 2011. The number is creeping up to one-in-four. It’s a good time for bank lending.

    Loan approval rates at credit unions dipped to 40.3% in August, falling to a new low for this category of lenders on Biz2Credit’s index.

    AutoGravity Surpasses $ 1 Billion USD In Finance Amount Requested, Launches Real-Time Dealership Inventory Nationwide (PR Newswire), Rated: AAA

    AutoGravity, a FinTech pioneer on a mission to transform car shopping and financing, today announced that it has reached $1 billion USD in finance amount requested on the AutoGravity platform. Additionally, AutoGravity has announced the launch of real-time inventory for new and used cars from partner dealership groups across the nation. Car shoppers can browse real vehicle inventory on dealership lots, find the specific car that’s right for them and secure up to four finance offers in minutes on the AutoGravity smartphone app.

    More over 750,000 car shoppers have downloaded AutoGravity, collectively requesting over $1 billion USD in financing. These users can now search inventory by car brand and model year – as well as characteristics such as body type, drivetrain and color. Car shoppers can find their desired car waiting for them on the showroom lot for the payment they want. With car selected and offers in hand, users can pick up their car and drive off the lot with the confidence of knowing they have secured a fair deal.

    AutoGravity partnered closely with the largest dealer groups in the country to design a seamless process by which dealers can easily load inventory feeds, including vehicle details and pictures, to AutoGravity’s secure platform. Inventory is updated and shown to users in real time.

    ID-verification firms seize on Equifax moment (American Banker), Rated: A

    The Equifax hack, combined with the rise of online lending, may have turned 2017 into a golden age for companies with new ideas for ID.

    The software company Mitek plans to roll out a product in the coming year called Mobile Verify for Lending, which offers lenders a five-step process to quickly verify customer identities. Borrowers first share their online bank account information with lenders. They then submit four pictures taken from their smartphones: the front and back of their driver’s licenses, a selfie and a pay stub.

    Other players are offering digital lending solutions to make it easier for banks to keep pace with speedy fintech competitors. Upstart, for example, is marketing software, called Powered by Upstart, to banks wanting to get into digital lending.

    DFS to Court: OCC Fintech Charter ‘Undermines’ Its Authority (New York Law Journal), Rated: A

    The U.S. Office of the Comptroller of the Currency’s plan to offer a special-purpose bank charter for financial technology companies “undermines” the Department of Financial Services’ regulatory authority in New York, the state agency argued in court documents.

    “The Fintech Charter Decision is an unlawful assertion of power that usurps New York consumer protection laws and would preempt plaintiff’s ability to regulate any number of the over 600 nondepository institutions she currently regulates,” wrote Matthew Levine, the executive deputy superintendent for enforcement at the department.

    Stockpile Raises $ 30 Million to Make Stock Investing Easy for Everyone (PR Newswire), Rated: A

    Stockpile, a brokerage popular with millennials that is pioneering fractional share stock investing, announced today that it has raised $30 million in Series B funding led by Fidelity backed Eight Roads Ventures, with participation by Mayfield, Arbor Ventures, Hanna Ventures, Wang Ventures, and others.

    This latest investment brings the total raised by Stockpile to more than $45 million.  Mayfield led Stockpile’s $15 millionSeries A in October 2015, with participation by Arbor Ventures, Stanford University, and actor Ashton Kutcher.  Stockpile will use the new funds to bring stock investing to more millennial customers and expand its unique features, Lele said.

    Chime raises $ 18 million for mobile banking without the fees (TechCrunch), Rated: A

    Chime is raising $18 million in Series B financing for its mobile-first approach to banking. Cathay Innovation led the round with participation from Northwestern Mutual Future Ventures, Crosslink Capital, Forerunner Ventures, Homebrew and others.

    It’s a bank account and debit card built for the digital age.

    Without monthly fees or overdraft charges, Chime tries to appeal to the millennial generation, touting its affordability and easy-to-use app. Since launching in 2014, Chime has signed up 500,000 customers, who are typically in their late 20s and making between $50,000 and $70,000 per year.

    Shinola’s new pitch: the installment plan (Crain’s Detroit Business), Rated: A

    Shinola/Detroit LLC is targeting millennials by adding an option to pay for its watches and other luxury goods in an old-fashioned way: the installment plan.

    The average order value for Affirm customers is 70 percent higher than the sitewide average, Kopitz said. And about half of those using the service with Shinola are 18-34 years old, the release said.

    Around 1,000 retailers now accept payment through Affirm.

    Is marketplace lending maturing? (Banking Exchange), Rated: A

    As new as fintech and marketplace lending—once known as “peer to peer lending”—may still seem, Noreika suggested that the online lending fraternity may be moving toward maturity.

    Noreika said the sweat that went into those ideas has hit $40 billion in consumer and small business credit, with volumes doubling every year since 2010. He noted that some project that at that rate, marketplace lending will hit $1 trillion by 2025—versus the $3.7 trillion in unsecured consumer lending as of yearend 2016.

    Noreika pointed out that marketplace lenders have been seeing cracks in their credit since the fourth quarter of 2015.

    ‘Fintechs tend to march to their own rules’: former SEC chair Levitt (American Banker), Rated: A

    “Hardly a day goes by where there isn’t a recording of some scandal or another,” Levitt said. “I think that’s generally true of emerging cultures and emerging standards and cultures. That makes the odds of winning much less than in well established companies with better established cultures.”

    His fellow fintech panelists, Sarah Friar, chief financial officer at Square, and Scott Sanborn, CEO of Lending Club, both pointed out that established companies have had their own share of scandals.

    Levitt said it’s difficult for startups to attract the kind of quality board members that larger, more mature companies are able to attract.

    “Regulators are always playing catch up,” he said. “Regulation today trails the fintech world and often presents impediments and costs that are unnecessary. Regulators are constantly protecting their space so they don’t get caught up in a scandal they’re held accountable for, so there’s a tendency to over-regulate.”

    McHenry and Booker Introduce Fintech Bill to Automate Income Verification (House.gov), Rated: B

    Today, Chief Deputy Whip Patrick McHenry (R, NC-10), the Vice Chairman of the House Financial Services Committee, and Senator Cory Booker (D-NJ) introduced the IRS Data Verification Modernization Act of 2017. This bipartisan bill will require the Internal Revenue Service (IRS) to automate the Income Verification Express Services process by creating an Application Programming Interface (API) allowing small businesses and consumers to access accurate credit assessments more efficiently. Joining McHenry as an original cosponsor of H.R. 3860 is Congressman Earl Blumenauer (D, OR-03), a senior member of the House Committee on Ways and Means.

    Plug and Play Selects Their Winter 2017 Batches (PR Newswire), Rated: B

    Plug and Play formally announces the startups accepted into their Winter 2017 batches. Plug and Play will run five programs this quarter focused on Health & Wellness, Insurtech, Internet of Things, Mobility, and Travel & Hospitality.

    Wunder Brings on Rich Mauro as Director of Capital Markets (Wunder Capital), Rated: B

    We’re incredibly excited to welcome the newest member of Wunder Capital’s team, Rich Mauro. As Director of Capital Markets, Rich will lead Wunder’s institutional fundraising activities, bolstering our capital stack and helping us scale Wunder’s platform to the next level.

    United Kingdom

    Funding Circle hits £50 million in revenue as CEO restates IPO ambitions (Business Insider), Rated: AAA

    Accounts for 2016 filed with Companies House this week show:

    • Revenue rose 59% to £50.9 million;
    • Operating expenses rose by 43% to £103.1 million;
    • Losses dipped by 3% to £35.7 million thanks partly to a foreign exchange boost;
    • £1 billion lent last year;
    • Loans outstanding rose by 61% to £1.37 billion;

    ‘It goes without saying that international is really hard’

    While Desai is bullish on international expansion, the accounts show Funding Circle stopped operations in Spain at the start of the year, a market it entered through the acquisition of Zencap in 2015.

    International revenues grew slower than UK revenues last year and Funding Circle parted ways with the head of its continental Europe operations in the middle of last year.

    In the UK, economic growth is slowing and consumer debt is ballooning, leading to fears of a possible economic slowdown that could hit lenders.

    Funding Circle remains a loss-making business (accumulated losses stand at £116.6 million to date) but Desai says it is on a long-term path to profitability.

    Funding Circle is onto a winning strategy (Business Insider), Rated: AAA

    Funding Circle, however, has remained a firm market leader, and its annual results for 2016 show it continues to do well.

    Its losses narrowed 3% from £37 million ($50 million) in 2015 to £36 million ($48 million) in 2016, as revenue grew 59% year-over-year (YoY) from £32 million ($43 million) to £51 million ($68 million), and originations saw a 61% boost from £846 million ($1.1 billion) to £1.4 billion ($1.9 billion).

    Source: Business Insider

    Funding Circle posts 59% revenue rise (Bridging&Commercial), Rated: A

    Post year-end highlights:

    Ranger Direct Lending fund expecting substantial dividend cut (AltFi), Rated: A

    The £220m Ranger Direct Lending fund could see its dividend pay-out for the second half of 2017 fall to nearly half of that in the first six months of the year, according to a statement by Ranger.

    It is expecting NAV returns in H2 2017 to average 0.4 per cent-0.5 per cent per month (c.5-6 per cent pa), and then recover to 0.6 per cent-0.7 per cent per month (c.7 per cent-9 per cent pa) in 2018, assuming the resolution of Princeton this year.

    As a result aggregate dividends of c.25p are expected for H2 2017, compared to 46p in H1.

    Source: AltFi

    ‘Oscars of the start-up world’ has an exciting new winner looking to disrupt property finance (CNBC), Rated: A

    LendInvest, an online marketplace platform for property lending and investing, was named the most valuable tech company at the prestigious Investor Allstars event in London on Wednesday evening.

    These 20-something Oxford grads just raised $ 30 million for their fintech startup (Business Insider), Rated: A

    A “RegTech” — regulation technology — company founded by three Oxford grads all under 30 has raised $30 million (£22.4 million) from investors including Microsoft’s venture capital arm.

    Onfido, an identity verification startup, has raised the “Series C” fundraising from Crane Venture Partners, Microsoft Ventures, and Salesforce Ventures, as well as existing investors. It takes the total raised by the London startup to over $60 million.

    Onfido’s latest $30 million funding injection follows a $25 million investment last April. Kassai says the latest funding will go towards technology investment and global expansion.

    Payday lender Wonga records £65m loss amid overhaul (BBC), Rated: A

    Wonga – Britain’s biggest payday lender – posted pre-tax losses of nearly £65m in 2016, but claims its business has been “transformed”.

    The lender, which operates in the UK, South Africa, Poland and Spain, saw its losses shrink from £80m in 2015 to £65m in 2016.

    How Fintech Is Disrupting Traditional Banking Models (Minute Hack), Rated: A

    One of the biggest changes in the financial sector in the UK has been the introduction of challenger banks.

    Crucially, these banks have not been mired by the many recent scandals and still rely on customer deposits to build their balance sheets. That’s why fledgling banks such as Metro Bank, Aldermore, Tesco Bank and United Bank UK and currently dominating the best buy tables.

    Retail banking is the area that has seen the biggest change as a result of the FinTech sector, but that’s not to say there hasn’t also been a significant impact in the commercial banking sector.

    A perfect example is Barclay’s mobile payments service Pingit, designed to compete with Apple Pay, while other banks have launched new mobile banking businesses away from their legacy businesses in an attempt to compete in a digital age.

    Bringing financial services to small businesses

    One example is peer-to-peer lending, a sector that has sprung up from nothing ten years ago to lend a total of £2.9bn in 2016. This is now filling the capital void for many growing businesses and lending at lower rates than many firms would be able to access elsewhere.

    New trustees join Finance Innovation Lab’s board (P2P Finance News), Rated: B

    SIX new trustees have been appointed to the board of the Finance Innovation Lab.

    The new trustees include Caroline Ellis, a social and organisational change consultant who is taking on the role of chair of the board, and Kate Ormiston Smith, director of finance and operations at The B Team, who is taking up the post of treasurer.

    The other new members of the board are: Hanna McCloskey, founder and chief executive officer of Fearless Futures; Toyin Ogundana – investment manager at CAF Venturesome; Paul Riseborough – chief commercial officer at Metro Bank and Julian Thompson, social innovation and fundraising strategist.

    How and where to get Crowdlending to fund your Business (TechBullion), Rated: B

    When considering your initial application for funding, crowdlending platforms will review your business plan, financial information and other details about your company. In other words, the platforms will review your company’s financial information as well as your personal information in much the same way as banks will do before offering you a loan. Therefore, it is imperative to ensure that your business plan is engaging, comprehensive and well thought out.

    Investors will usually seek to get more information about you and your business from social networks like FacebookTwitterand LinkedIn. It will serve you well to ensure that you have an online presence before you seek for funds through crowdlending.

    Going by the FundingKnightresearch, most UK investors have a love for the community and would want to give back to some UK SME to ensure its prosperity.

    China

    More Chinese fintech firms to eye Hong Kong IPOs, says JP Morgan (SCMP), Rated: AAA

    More Chinese fintech firms vying to go public could choose Hong Kong as their listing venue, after the city’s first fintech IPO received a hot response from investors, and that Hong Kong has unique advantages compared with other global financial hubs, said JP Morgan’s head of global investment banking in China.

    Zhong An Online Property and Casualty Insurance, China’s first online-only insurer, closed nine per cent up from its IPO price on Thursday in its Hong Kong debut. With an oversubscription of nearly 400 times from retail investors, the company had priced its IPO at the top end of the expected range, raising US$1.5 billion in the city’s biggest ever fintech offering.

    “The next Zhong An could show up in online payment, P2P lending, [financial] product distribution, or online insurance.”

    In particular, revenue from online payment is estimated to increase to 202 billion yuan by 2020. Revenue from online distribution of financial products could grow to 52 billion yuan by then, while that for online lending and online insurance may reach 142 billion yuan and 60 billion yuan respectively.

    ZhongAn Insurance Starts Trading on the Hong Kong Stock Exchange (Lend Academy), Rated: AAA

    ZhongAn’s IPO will likely make the company the 4th most valuable fintech company in the world with a market cap of about US$10.4 billion, following the top three fintechs, which are Paypal ($78bn), Ant Financial ($68bn) and Lufax ($18bn).

    Peter Renton interviewed the CEO of ZhongAn Insurance, Jeffrey Chen, on the Lend Academy Podcast over the summer. Jeffrey said in the interview that ZhongAn has 492 million insurance customers as of December 31, 2016. That is more than four times that of insurance giant AXA’s customer base (107 million, as of December 31, 2016). By this measure, ZhongAn truly is the world’s largest insurance company. And this is just a four-year old company!

    Why ZhongAn is So Succesful

    For the technology part, ZhongAn has been using artificial intelligence and big data analytics in each step of the insurance value chain, from marketing, underwriting, pricing to claims processing.

    Another example is that ZhongAn has partnered with a Chinese automaker to develop internet of things (IoTs) and telematics solutions. Telematics devices can capture drivers’ behavioral data, which can be fed to algorithms using big data techniques to tailor product pricing to observed risk levels.

    In ZhongAn’s early days, the revenue generated by shipping return policies accounted for almost 90% of the total revenue. This product would not have been such a success were it not for its partnership with Alibaba. Ant Financial, the financial affiliate of Alibaba, is also the single biggest shareholder (16.04%) of ZhongAn.

    Source: :Lend Academy

    KKR Invests in Shenzhen Suishou Technology (BusinessWire), Rated: A

    Shenzhen Suishou Technology Co. (“Suishou” or the “Company”), a leading personal finance management platform in China, and global investment firm KKR today announced the signing of a definitive agreement under which KKR will invest in Suishou’s Series C funding round to support the Company’s expansion across China.

    European Union

    Robo.Cash Tops €2 million with 1000th Investor (Crowdfund Insider), Rated: AAA

    Emerging peer to peer lender Robo.Cashhas topped €2 million in loans with the advent of the 1000th investor.  According to Robo.Cash, investors are spread across most of Europe with lenders now coming from 28 different countries. The short term loans are coming from Spain and Kazakhstan.

    The total sum of earned interests has amounted to more than €50,000 since the start of the platform’s work.

    The End of Fintech Is Nigh (FiNews), Rated: AAA

    Switzerland is one of the major global fintech centers and the industry is booming: Swisscom counted fewer than a hundred fintech startups in 2015, today there are 208 companies active in wealth management, comparative consulting, crypto finance, data management, payment services and lending (see illustration below).

    Blurred Dividing Line

    And this may also spell the end of fintech as we know it, in Switzerland, and abroad. That’s at least what Armands Broks (pictured below) believes. The founder and CEO of Twino, a peer-to-peer lending platform, thinks that the fine line between finance industry and fintech is about to be blurred and that fintech eventually will disappear.

    The only way forward for fintech is through cooperation agreements and in doing so, «the fintech industry is signing its own death sentence,» Broks said.

    PWC consultants said that about 60 percent of Swiss banks have links to fintechs. Four out of five banks are eyeing partnerships in the near future or are planning to expand existing ones.

    International

    Goldman Sachs’ foray into consumer banking is getting aggressive (Tearsheet), Rated: AAA

    The same year it launched GS Bank, it began building a digital-only consumer loan product, Marcus, that was fully developed and on the market 12 months later. Without having the legacy infrastructure under previously existing consumer products and services, the overhaul other major banks have been experiencing don’t exist for Goldman.

    “[The] platform approach has not been an obvious approach on Wall Street. Our competitors are generally structured in deep vertical silos and we have a different architecture: these shallower silos built on top of many layers of software, tech infrastructure, cybersecurity, enterprise platforms and increasingly, client platforms,” Marty Chavez, an engineer and Goldman Sachs CIO-turned-CFO this year, said in a keynote at Harvard University earlier this year.

    46 percent of Goldman jobs are in technology 
    CB Insights analyzed more than 2,000 open Goldman Sachs job listings by division and business unit to confirm it’s focused on building its technology and digital finance units.

    Many of the jobs are in digital finance. Earlier this month it reportedly poached 20 employees from New York-based online lending startup Bond Street — engineers, product developers, and risk and marketing specialists — presumably to build out a lending product.

    According to the research, published Tuesday, 46 percent of all of the firm’s jobs as of Sept. 14 are in technology, with the highest amount for core platform roles, followed by operations engineering and then equities technology.

    Source: Tearsheet

    Marcus is expanding in the U.K.

    Marcus, the online lending startup built inside the investment bank, has been growing tremendously in the eight months since it launched in October 2016. It has one product: a customizable personal loan for Prime borrowers, with at least a 660 credit score, of up to $30,000. It promises no fees and straightforward repayment terms. It recently passed $1 billion in loan originations with expectations to originate $2 billion by the end of this year. By comparison: SoFi, which launched in 2011, reached its first billion after 14 months; Avant, founded in 2012, took 28 months; 10-year-old Lending Club took 65 months; and Prosper, launched in 2006, passed $1 billion in 98 months.

    Goldmoney Inc. Adds Bitcoin and Ethereum to the Goldmoney Holding (Globe Newswire), Rated: A

    Goldmoney Inc. (TSX:XAU) (“Goldmoney”) (the “Company”), a precious metal financial service and technology company, today unveiled the addition of vaulted Bitcoin and Ethereum as secure and fully-reserved offline investable assets within the Goldmoney® Holding, a major enhancement that allows qualified clients to buy, sell, and exchange cryptocurrencies with nine global currencies as well as gold, silver, platinum and palladium bullion. With today’s launch, Goldmoney becomes the world’s first publicly traded and regulated financial service to offer insurable, auditable, and Anti-Money Laundering (“AML”) compliant exposure to cryptocurrencies.

    • Buying and selling of digital assets that are safely secured in vaulted cold storage. Cryptocurrency offerings currently include Bitcoin and Ethereum; additional leading digital assets will be added over time.
    • Funding of Goldmoney Holdings with 50 types of cryptocurrency, enabling wallet holders to sell a variety of cryptocurrencies and fund their Goldmoney Holding with fiat currency to access precious metals and other Goldmoney service offerings.
    • Will seek the establishment of peer-to-peer (“P2P”) lending capabilities on digital assets in partnership with Lend and Borrow Trust, allowing owners of Bitcoin and other assets to safely borrow against their positions.

    HNWs Would Use Amazon for Wealth Management (Financial Advisor IQ), Rated: A

    The majority of high net investors would turn to GoogleAppleFacebook and Amazon for wealth management, Bloomberg writes.

    If one of the four tech giants were to enter the advice space, 56.2% of wealthy individuals would entrust them with their money, according to a Capgemini survey of 2,500 individuals with a net worth of $1 million or more in North America, Latin America, Europe and Asia-Pacific cited by the news service. And among people under 40, more than 81% would use one of the four tech firms, according to the survey.

    Australia

    New fintech “Study Loans” aims to help cash-strapped students (Mozo), Rated: AAA

    It’s called Study Loans and is said to be the first online platform dedicated to providing loans to students for both vocational and higher education.

    Working closely with education providers, the fintech will track student performance and provide funds as you study through ‘tranches’ – which are based on the number of units you do and when they are completed.

    Think of tranches as a ‘pay as you go’ kind of deal. So whether you pass one unit or four, Study Loans will release the funds according to your course progression.

    Study Loans has raised $5 million debt equity so far, which is ready to be distributed as the first tranche to Aussie students who have already applied through the platform.

    Financing options for students: 

    • Student loans – Student personal loans are designed to help fund your education. They often have a more lenient application criteria and have lower interest rates than standard personal loans. But you are expected to make monthly repayments – so you’ll need to make sure your budget can handle the amount.
    • Peer-to-peer lending
    • HECS-HELP – This is a Government funded scheme for students enrolled in Commonwealth supported institutions with no real interest charged on the loan. You won’t have to pay your student fees upfront, however, you are expected to make repayments once you start earning a salary of $54,869.

    MONEFLY LAUNCHES FREE FINTECH PLATFORM WITH ENVESTNET | YODLEE FINANCIAL DATA (Yodlee), Rated: A

    Monefly is an innovative new Fintech platform in Australia, focused on providing tools and resources that empower its members to grow income, reduce expenses, build assets, eliminate debt and protect themselves from risk. Some of these exciting tools include free property valuations, automated budgeting, credit scores, bank account consolidation and much more.

    Monefly has partnered with Envestnet | Yodlee to help its members access comprehensive financial data available across banking and wealth management from over 15,500 data sources globally.

    The data being integrated into Monefly includes superannuation, cash, credit cards, personal debts, mortgages, assets, shares, real estate, credit scores and other investment data.

    India

    MyAdvo Ties Up with Online Loan Advisor Square Capital for Loan Services (newKerala), Rated: AAA

    MyAdvo, India’s leading Legal Tech Startup has entered into an agreement with Square Capital, the digital lending arm of India’s largest real estate transaction platform Square Yards to enable loan facilitation for lawyers on its panel.

    Square Capital currently facilitates USD 30- 40Mn(INR 200cr – INR 260cr) of loan disbursals every month, contributed majorly by secured mortgages spread across 50+ banking partners for their different products in home loan, loan against property and business loan.

    This exclusive tie-up will benefit MyAdvo registered lawyers in receiving immediate loan solutions without any hassle.

    Indians are warming up to robo-advisers (livemint), Rated: A

    Robo-advisers, or automated services based on computer algorithms, are catching on in the Indian market due to the relatively lower penetration of financial products in India compared to developed markets.

    According to a Business Insider Intelligence forecast, robo-advisers (with some element of automation) will manage investment products worth $1 trillion by 2020, which will go up to $4.6 trillion by as early as 2022.

    Scepticism notwithstanding, financial institutions in the country are realising the benefits of robo-advisory services by either building the product in-house or partnering with fintech companies to develop robo-advisers. Take the case of FundsIndia.com, which has a robo-advisory service for which it is forging partnerships with financial biggies. “We have a partnership with Axis Securities and one more company. There is a growing acceptance from the industry, and we are trying to enable better product design,” said Srikant Meenakshi, co-founder, FundsIndia.com. According to him, 15% of his company’s overall portfolio comprises robo-advisory services. Similarly, 5nance has an agreement with HDFC Mutual Fund for its robo-advisor.

    Robo-advisory start-up ArthaYantra uses a patented methodology called the Personal Financial Lifecycle Management on its online platform, Arthos. Since its launch in 2008, the site claims to have helped 120,000 customers across more 650 cities and 30 countries.

    Asia

    Singapore Cryptocurrency Firms Facing Bank Account Closures (Bloomberg), Rated: AAA

    Singapore banks have closed accounts of several companies which specialize in providing cryptocurrency and payments services, according to two local bodies which represent financial-technology firms.

    Chia Hock Lai, president of the Singapore Fintech Association, which has broader membership than Access, said some of his organization’s members also experienced account closures, though he didn’t provide figures.

    Access has 106 members and the Fintech Association has 185, though the two organizations said some companies belong to both groups.

    How technology drives a new Taiwanese banking landscape (The Asset), Rated: A

    According to Joseph Huang, president of E.Sun Bank, speaking in an interview with The Asset, payments is one area that every bank is looking to explore, although it does not generate huge profits for most banks.

    Banks are also more frequently working with technology companies. E.Sun Bank partnered with IBM Taiwan in building its digital branch, which opened in February 2017, making it the first digital branch in Taiwan. Similarly, CTBC partnered with LINE Pay to help merge its banking services with communication apps and social media.

    Taishin Bank’s e-banking application, Richart, which attracted over 120,000 subscribers, is targeting young Taiwanese users, while Cathay United Bank is also providing its products to retail customers through its platform My MobiBank.

    Authors:

    George Popescu
    Allen Taylor

    Friday September 29 2017, Daily News Digest

    C-PACE financing

    News Comments Today’s main news: LendingClub completes 2nd self-sponsored loan securitization with $323M deal. Funding Circle restates IPO ambitions. Robo.cash tops 2M Euro, 1000th investor. AutoGravity surpasses $1B USD in finance amount requested. Singapore banks closing cryptocurrency, payments accounts. Today’s main analysis: Risk evaluation of commercial PACE securitizations differs from residential deals. Goldman Sachs’ aggressive push into consumer banking. Today’s […]

    C-PACE financing

    News Comments

    United States

    United Kingdom

    China

    European Union

    International

    Australia

    India

    Asia

    News Summary

    United States

    LendingClub Completes 2nd Self Sponsored Loan Securitization with $ 323 Million Deal (Crowdfund Insider), Rated: AAA

    LendingClub (NYSE: LC) has sponsored and contributed to its second securitization deal following the the last successful self sponsored deal this past June. The “Consumer Loan Underlying Bond” (CLUB) Credit Trust 2017-P1 (CLUB 2017-P1) issued $323.1 million in prime notes backed by consumer loan assets originated via the LendingClub platform. This is the sixth securitization supported or sponsored by LendingClub, and the fourth rated securitization of LendingClub facilitated loans overall. LendingClub described the deal as further expanding investor access.

    LendingClub reported the transaction was backed by approximately $350 million of collateral and includes $217.3 million of Class A notes rated “A-(sf)”, $51.0 million of Class B notes rated “BBB (sf)” and $54.7 million of Class C notes rated “BB (sf)”.

    Orchard’s Online Lending Ecosystem Update: “Lendscape” (Crowdfund Insider), Rated: AAA

    Orchard Platform, the nexus of loan originators and institutional investing, has updated their ongoing graphical view of the online lending  world or “Lendscape”.  As the online lending universe has moved from peer to peer lending, to marketplace lending to all forms of online lending, the Lendscape has changed and grown. New lending platforms have been launched, new verticals targeted, and a growing number of ancillary services have joined the space.  Orchard points to the addition of lenders like LendingPointLiberty LendingLendmartAllegro CreditUpLiftArtMoneyAscendOppLoans, and Lendistry.

    Perhaps the most important shift in online lending is the growing participation by traditional finance firms.

    Source: Crowdfund Insider

    Risk Evaluation of Commercial PACE Securitizations Differs From Residential Deals (Morningstar), Rated: AAA

    Morningstar Credit Ratings, LLC believes the next iteration of property assessed clean energy securitizations will be in the commercial sector. While securitization of residential PACE assessments tops $3 billion, there have been no public transactions consisting primarily of commercial liens.

    Evaluating Property Income Generated to Pay Debts In analyzing the credit risk of transactions backed by commercial assessments, Morningstar considers the debt service coverage ratio, because PACE lending is tied to the property rather than the owner’s creditworthiness.

    Evaluating Property Income Generated to Pay Debts

    Morningstar evaluates a property’s net operating income in relation to its annual debt-service payments. Among securitized commercial mortgages, the average DSCR is approximately 2.14x, according to Morningstar. C-PACE lenders and aggregators typically require a minimum total DSCR in the 1.00x to 1.15x range. Although, in some cases, the DSCR has dipped below 1.00x, especially if total debtto-value is low when operating expenses are higher than revenue. Factors possibly mitigating a lower DSCR, which include county support, property ownership affiliations within a network, liquidity account and equity position require case-by-case analysis. In addition, DSCR of the lien is more important than the DSCR of the overall debt.

    Evaluating Divergent Leverage Metrics

    The lien-to-value ratio is another leverage metric that Morningstar analyzes. Although a PACE assessment raises a property’s lien-to-value ratio, the increased risk to the underlying mortgage is likely minimal, as the obligation is usually small in comparison to the mortgage.

    It can be more challenging to calculate the lien-to-value ratio for C-PACE levies, because the properties can run the gamut from hotels, farmlands, nursing homes, and gas stations to nonprofit buildings such as churches. Across residential PACE deals, we have seen lien-to-value ratios around 6.7% and combined PACE-lien-plus-mortgage-tovalue ratios at around 62.7%. In C-PACE, lien-to-value ratios hover around 25.0%, not including mortgage debt.

    While we scrutinize total debt-to-value, the distribution of leverage offers insight into the financial health of the property. For example, we view a property with a 90% debt-to-value ratio that is composed of an 89% mortgage loan and a 1% PACE assessment more favorably than a property whose debt is composed of an 89% PACE obligation and a 1% mortgage because of higher subordination levels.

    Growing Market Size

    C-PACE financing has grown to about $482 million as of Sept. 1, encompassing 1,097 commercial projects, according to PACENation. More than 2,500 municipalities have C-PACE programs.

    Compared with residential programs, C-PACE is in its infancy, as R-PACE financing totaled about $3.67 billion and R-PACE securitizations totaled around $3.40 billion. A sliver of
    commercial assets was included in one of those securitizations, GoodGreen 2016-1, with commercial PACE levies representing approximately 4.8% of the pool’s assets.

    Source: Morningstar

    Get the full report here.

    The Top Sources Of Small Business Financing Based On Approval Rates (Forbes), Rated: AAA

    According to the latest Biz2Credit Small Business Lending Index, the monthly analysis of more than 1,000 small business loan applications on Biz2Credit.com. Loan approval percentages of institutional investors have continuously reached new heights this year in terms of approval rates. In August Institutional lenders’ loan approval rates in August reached 63.9%.

    Alternative lenders’ approval percentages continue to decline; in August the rate dipped to 57.1%. Approval percentages have dropped every month for more than a year.

    Approval percentages at small banks rose one-tenth of a percent in August to 49.0% from July’s 48.9% figure. It is conceivable that the number may cross the 50% benchmark.

    Big banks improved one-tenth of a percent to 24.6% in August, setting a new high for the Biz2Credit Index, which has tracked loan approvals since January 2011. The number is creeping up to one-in-four. It’s a good time for bank lending.

    Loan approval rates at credit unions dipped to 40.3% in August, falling to a new low for this category of lenders on Biz2Credit’s index.

    AutoGravity Surpasses $ 1 Billion USD In Finance Amount Requested, Launches Real-Time Dealership Inventory Nationwide (PR Newswire), Rated: AAA

    AutoGravity, a FinTech pioneer on a mission to transform car shopping and financing, today announced that it has reached $1 billion USD in finance amount requested on the AutoGravity platform. Additionally, AutoGravity has announced the launch of real-time inventory for new and used cars from partner dealership groups across the nation. Car shoppers can browse real vehicle inventory on dealership lots, find the specific car that’s right for them and secure up to four finance offers in minutes on the AutoGravity smartphone app.

    More over 750,000 car shoppers have downloaded AutoGravity, collectively requesting over $1 billion USD in financing. These users can now search inventory by car brand and model year – as well as characteristics such as body type, drivetrain and color. Car shoppers can find their desired car waiting for them on the showroom lot for the payment they want. With car selected and offers in hand, users can pick up their car and drive off the lot with the confidence of knowing they have secured a fair deal.

    AutoGravity partnered closely with the largest dealer groups in the country to design a seamless process by which dealers can easily load inventory feeds, including vehicle details and pictures, to AutoGravity’s secure platform. Inventory is updated and shown to users in real time.

    ID-verification firms seize on Equifax moment (American Banker), Rated: A

    The Equifax hack, combined with the rise of online lending, may have turned 2017 into a golden age for companies with new ideas for ID.

    The software company Mitek plans to roll out a product in the coming year called Mobile Verify for Lending, which offers lenders a five-step process to quickly verify customer identities. Borrowers first share their online bank account information with lenders. They then submit four pictures taken from their smartphones: the front and back of their driver’s licenses, a selfie and a pay stub.

    Other players are offering digital lending solutions to make it easier for banks to keep pace with speedy fintech competitors. Upstart, for example, is marketing software, called Powered by Upstart, to banks wanting to get into digital lending.

    DFS to Court: OCC Fintech Charter ‘Undermines’ Its Authority (New York Law Journal), Rated: A

    The U.S. Office of the Comptroller of the Currency’s plan to offer a special-purpose bank charter for financial technology companies “undermines” the Department of Financial Services’ regulatory authority in New York, the state agency argued in court documents.

    “The Fintech Charter Decision is an unlawful assertion of power that usurps New York consumer protection laws and would preempt plaintiff’s ability to regulate any number of the over 600 nondepository institutions she currently regulates,” wrote Matthew Levine, the executive deputy superintendent for enforcement at the department.

    Stockpile Raises $ 30 Million to Make Stock Investing Easy for Everyone (PR Newswire), Rated: A

    Stockpile, a brokerage popular with millennials that is pioneering fractional share stock investing, announced today that it has raised $30 million in Series B funding led by Fidelity backed Eight Roads Ventures, with participation by Mayfield, Arbor Ventures, Hanna Ventures, Wang Ventures, and others.

    This latest investment brings the total raised by Stockpile to more than $45 million.  Mayfield led Stockpile’s $15 millionSeries A in October 2015, with participation by Arbor Ventures, Stanford University, and actor Ashton Kutcher.  Stockpile will use the new funds to bring stock investing to more millennial customers and expand its unique features, Lele said.

    Chime raises $ 18 million for mobile banking without the fees (TechCrunch), Rated: A

    Chime is raising $18 million in Series B financing for its mobile-first approach to banking. Cathay Innovation led the round with participation from Northwestern Mutual Future Ventures, Crosslink Capital, Forerunner Ventures, Homebrew and others.

    It’s a bank account and debit card built for the digital age.

    Without monthly fees or overdraft charges, Chime tries to appeal to the millennial generation, touting its affordability and easy-to-use app. Since launching in 2014, Chime has signed up 500,000 customers, who are typically in their late 20s and making between $50,000 and $70,000 per year.

    Shinola’s new pitch: the installment plan (Crain’s Detroit Business), Rated: A

    Shinola/Detroit LLC is targeting millennials by adding an option to pay for its watches and other luxury goods in an old-fashioned way: the installment plan.

    The average order value for Affirm customers is 70 percent higher than the sitewide average, Kopitz said. And about half of those using the service with Shinola are 18-34 years old, the release said.

    Around 1,000 retailers now accept payment through Affirm.

    Is marketplace lending maturing? (Banking Exchange), Rated: A

    As new as fintech and marketplace lending—once known as “peer to peer lending”—may still seem, Noreika suggested that the online lending fraternity may be moving toward maturity.

    Noreika said the sweat that went into those ideas has hit $40 billion in consumer and small business credit, with volumes doubling every year since 2010. He noted that some project that at that rate, marketplace lending will hit $1 trillion by 2025—versus the $3.7 trillion in unsecured consumer lending as of yearend 2016.

    Noreika pointed out that marketplace lenders have been seeing cracks in their credit since the fourth quarter of 2015.

    ‘Fintechs tend to march to their own rules’: former SEC chair Levitt (American Banker), Rated: A

    “Hardly a day goes by where there isn’t a recording of some scandal or another,” Levitt said. “I think that’s generally true of emerging cultures and emerging standards and cultures. That makes the odds of winning much less than in well established companies with better established cultures.”

    His fellow fintech panelists, Sarah Friar, chief financial officer at Square, and Scott Sanborn, CEO of Lending Club, both pointed out that established companies have had their own share of scandals.

    Levitt said it’s difficult for startups to attract the kind of quality board members that larger, more mature companies are able to attract.

    “Regulators are always playing catch up,” he said. “Regulation today trails the fintech world and often presents impediments and costs that are unnecessary. Regulators are constantly protecting their space so they don’t get caught up in a scandal they’re held accountable for, so there’s a tendency to over-regulate.”

    McHenry and Booker Introduce Fintech Bill to Automate Income Verification (House.gov), Rated: B

    Today, Chief Deputy Whip Patrick McHenry (R, NC-10), the Vice Chairman of the House Financial Services Committee, and Senator Cory Booker (D-NJ) introduced the IRS Data Verification Modernization Act of 2017. This bipartisan bill will require the Internal Revenue Service (IRS) to automate the Income Verification Express Services process by creating an Application Programming Interface (API) allowing small businesses and consumers to access accurate credit assessments more efficiently. Joining McHenry as an original cosponsor of H.R. 3860 is Congressman Earl Blumenauer (D, OR-03), a senior member of the House Committee on Ways and Means.

    Plug and Play Selects Their Winter 2017 Batches (PR Newswire), Rated: B

    Plug and Play formally announces the startups accepted into their Winter 2017 batches. Plug and Play will run five programs this quarter focused on Health & Wellness, Insurtech, Internet of Things, Mobility, and Travel & Hospitality.

    Wunder Brings on Rich Mauro as Director of Capital Markets (Wunder Capital), Rated: B

    We’re incredibly excited to welcome the newest member of Wunder Capital’s team, Rich Mauro. As Director of Capital Markets, Rich will lead Wunder’s institutional fundraising activities, bolstering our capital stack and helping us scale Wunder’s platform to the next level.

    United Kingdom

    Funding Circle hits £50 million in revenue as CEO restates IPO ambitions (Business Insider), Rated: AAA

    Accounts for 2016 filed with Companies House this week show:

    • Revenue rose 59% to £50.9 million;
    • Operating expenses rose by 43% to £103.1 million;
    • Losses dipped by 3% to £35.7 million thanks partly to a foreign exchange boost;
    • £1 billion lent last year;
    • Loans outstanding rose by 61% to £1.37 billion;

    ‘It goes without saying that international is really hard’

    While Desai is bullish on international expansion, the accounts show Funding Circle stopped operations in Spain at the start of the year, a market it entered through the acquisition of Zencap in 2015.

    International revenues grew slower than UK revenues last year and Funding Circle parted ways with the head of its continental Europe operations in the middle of last year.

    In the UK, economic growth is slowing and consumer debt is ballooning, leading to fears of a possible economic slowdown that could hit lenders.

    Funding Circle remains a loss-making business (accumulated losses stand at £116.6 million to date) but Desai says it is on a long-term path to profitability.

    Funding Circle is onto a winning strategy (Business Insider), Rated: AAA

    Funding Circle, however, has remained a firm market leader, and its annual results for 2016 show it continues to do well.

    Its losses narrowed 3% from £37 million ($50 million) in 2015 to £36 million ($48 million) in 2016, as revenue grew 59% year-over-year (YoY) from £32 million ($43 million) to £51 million ($68 million), and originations saw a 61% boost from £846 million ($1.1 billion) to £1.4 billion ($1.9 billion).

    Source: Business Insider

    Funding Circle posts 59% revenue rise (Bridging&Commercial), Rated: A

    Post year-end highlights:

    Ranger Direct Lending fund expecting substantial dividend cut (AltFi), Rated: A

    The £220m Ranger Direct Lending fund could see its dividend pay-out for the second half of 2017 fall to nearly half of that in the first six months of the year, according to a statement by Ranger.

    It is expecting NAV returns in H2 2017 to average 0.4 per cent-0.5 per cent per month (c.5-6 per cent pa), and then recover to 0.6 per cent-0.7 per cent per month (c.7 per cent-9 per cent pa) in 2018, assuming the resolution of Princeton this year.

    As a result aggregate dividends of c.25p are expected for H2 2017, compared to 46p in H1.

    Source: AltFi

    ‘Oscars of the start-up world’ has an exciting new winner looking to disrupt property finance (CNBC), Rated: A

    LendInvest, an online marketplace platform for property lending and investing, was named the most valuable tech company at the prestigious Investor Allstars event in London on Wednesday evening.

    These 20-something Oxford grads just raised $ 30 million for their fintech startup (Business Insider), Rated: A

    A “RegTech” — regulation technology — company founded by three Oxford grads all under 30 has raised $30 million (£22.4 million) from investors including Microsoft’s venture capital arm.

    Onfido, an identity verification startup, has raised the “Series C” fundraising from Crane Venture Partners, Microsoft Ventures, and Salesforce Ventures, as well as existing investors. It takes the total raised by the London startup to over $60 million.

    Onfido’s latest $30 million funding injection follows a $25 million investment last April. Kassai says the latest funding will go towards technology investment and global expansion.

    Payday lender Wonga records £65m loss amid overhaul (BBC), Rated: A

    Wonga – Britain’s biggest payday lender – posted pre-tax losses of nearly £65m in 2016, but claims its business has been “transformed”.

    The lender, which operates in the UK, South Africa, Poland and Spain, saw its losses shrink from £80m in 2015 to £65m in 2016.

    How Fintech Is Disrupting Traditional Banking Models (Minute Hack), Rated: A

    One of the biggest changes in the financial sector in the UK has been the introduction of challenger banks.

    Crucially, these banks have not been mired by the many recent scandals and still rely on customer deposits to build their balance sheets. That’s why fledgling banks such as Metro Bank, Aldermore, Tesco Bank and United Bank UK and currently dominating the best buy tables.

    Retail banking is the area that has seen the biggest change as a result of the FinTech sector, but that’s not to say there hasn’t also been a significant impact in the commercial banking sector.

    A perfect example is Barclay’s mobile payments service Pingit, designed to compete with Apple Pay, while other banks have launched new mobile banking businesses away from their legacy businesses in an attempt to compete in a digital age.

    Bringing financial services to small businesses

    One example is peer-to-peer lending, a sector that has sprung up from nothing ten years ago to lend a total of £2.9bn in 2016. This is now filling the capital void for many growing businesses and lending at lower rates than many firms would be able to access elsewhere.

    New trustees join Finance Innovation Lab’s board (P2P Finance News), Rated: B

    SIX new trustees have been appointed to the board of the Finance Innovation Lab.

    The new trustees include Caroline Ellis, a social and organisational change consultant who is taking on the role of chair of the board, and Kate Ormiston Smith, director of finance and operations at The B Team, who is taking up the post of treasurer.

    The other new members of the board are: Hanna McCloskey, founder and chief executive officer of Fearless Futures; Toyin Ogundana – investment manager at CAF Venturesome; Paul Riseborough – chief commercial officer at Metro Bank and Julian Thompson, social innovation and fundraising strategist.

    How and where to get Crowdlending to fund your Business (TechBullion), Rated: B

    When considering your initial application for funding, crowdlending platforms will review your business plan, financial information and other details about your company. In other words, the platforms will review your company’s financial information as well as your personal information in much the same way as banks will do before offering you a loan. Therefore, it is imperative to ensure that your business plan is engaging, comprehensive and well thought out.

    Investors will usually seek to get more information about you and your business from social networks like FacebookTwitterand LinkedIn. It will serve you well to ensure that you have an online presence before you seek for funds through crowdlending.

    Going by the FundingKnightresearch, most UK investors have a love for the community and would want to give back to some UK SME to ensure its prosperity.

    China

    More Chinese fintech firms to eye Hong Kong IPOs, says JP Morgan (SCMP), Rated: AAA

    More Chinese fintech firms vying to go public could choose Hong Kong as their listing venue, after the city’s first fintech IPO received a hot response from investors, and that Hong Kong has unique advantages compared with other global financial hubs, said JP Morgan’s head of global investment banking in China.

    Zhong An Online Property and Casualty Insurance, China’s first online-only insurer, closed nine per cent up from its IPO price on Thursday in its Hong Kong debut. With an oversubscription of nearly 400 times from retail investors, the company had priced its IPO at the top end of the expected range, raising US$1.5 billion in the city’s biggest ever fintech offering.

    “The next Zhong An could show up in online payment, P2P lending, [financial] product distribution, or online insurance.”

    In particular, revenue from online payment is estimated to increase to 202 billion yuan by 2020. Revenue from online distribution of financial products could grow to 52 billion yuan by then, while that for online lending and online insurance may reach 142 billion yuan and 60 billion yuan respectively.

    ZhongAn Insurance Starts Trading on the Hong Kong Stock Exchange (Lend Academy), Rated: AAA

    ZhongAn’s IPO will likely make the company the 4th most valuable fintech company in the world with a market cap of about US$10.4 billion, following the top three fintechs, which are Paypal ($78bn), Ant Financial ($68bn) and Lufax ($18bn).

    Peter Renton interviewed the CEO of ZhongAn Insurance, Jeffrey Chen, on the Lend Academy Podcast over the summer. Jeffrey said in the interview that ZhongAn has 492 million insurance customers as of December 31, 2016. That is more than four times that of insurance giant AXA’s customer base (107 million, as of December 31, 2016). By this measure, ZhongAn truly is the world’s largest insurance company. And this is just a four-year old company!

    Why ZhongAn is So Succesful

    For the technology part, ZhongAn has been using artificial intelligence and big data analytics in each step of the insurance value chain, from marketing, underwriting, pricing to claims processing.

    Another example is that ZhongAn has partnered with a Chinese automaker to develop internet of things (IoTs) and telematics solutions. Telematics devices can capture drivers’ behavioral data, which can be fed to algorithms using big data techniques to tailor product pricing to observed risk levels.

    In ZhongAn’s early days, the revenue generated by shipping return policies accounted for almost 90% of the total revenue. This product would not have been such a success were it not for its partnership with Alibaba. Ant Financial, the financial affiliate of Alibaba, is also the single biggest shareholder (16.04%) of ZhongAn.

    Source: :Lend Academy

    KKR Invests in Shenzhen Suishou Technology (BusinessWire), Rated: A

    Shenzhen Suishou Technology Co. (“Suishou” or the “Company”), a leading personal finance management platform in China, and global investment firm KKR today announced the signing of a definitive agreement under which KKR will invest in Suishou’s Series C funding round to support the Company’s expansion across China.

    European Union

    Robo.Cash Tops €2 million with 1000th Investor (Crowdfund Insider), Rated: AAA

    Emerging peer to peer lender Robo.Cashhas topped €2 million in loans with the advent of the 1000th investor.  According to Robo.Cash, investors are spread across most of Europe with lenders now coming from 28 different countries. The short term loans are coming from Spain and Kazakhstan.

    The total sum of earned interests has amounted to more than €50,000 since the start of the platform’s work.

    The End of Fintech Is Nigh (FiNews), Rated: AAA

    Switzerland is one of the major global fintech centers and the industry is booming: Swisscom counted fewer than a hundred fintech startups in 2015, today there are 208 companies active in wealth management, comparative consulting, crypto finance, data management, payment services and lending (see illustration below).

    Blurred Dividing Line

    And this may also spell the end of fintech as we know it, in Switzerland, and abroad. That’s at least what Armands Broks (pictured below) believes. The founder and CEO of Twino, a peer-to-peer lending platform, thinks that the fine line between finance industry and fintech is about to be blurred and that fintech eventually will disappear.

    The only way forward for fintech is through cooperation agreements and in doing so, «the fintech industry is signing its own death sentence,» Broks said.

    PWC consultants said that about 60 percent of Swiss banks have links to fintechs. Four out of five banks are eyeing partnerships in the near future or are planning to expand existing ones.

    International

    Goldman Sachs’ foray into consumer banking is getting aggressive (Tearsheet), Rated: AAA

    The same year it launched GS Bank, it began building a digital-only consumer loan product, Marcus, that was fully developed and on the market 12 months later. Without having the legacy infrastructure under previously existing consumer products and services, the overhaul other major banks have been experiencing don’t exist for Goldman.

    “[The] platform approach has not been an obvious approach on Wall Street. Our competitors are generally structured in deep vertical silos and we have a different architecture: these shallower silos built on top of many layers of software, tech infrastructure, cybersecurity, enterprise platforms and increasingly, client platforms,” Marty Chavez, an engineer and Goldman Sachs CIO-turned-CFO this year, said in a keynote at Harvard University earlier this year.

    46 percent of Goldman jobs are in technology 
    CB Insights analyzed more than 2,000 open Goldman Sachs job listings by division and business unit to confirm it’s focused on building its technology and digital finance units.

    Many of the jobs are in digital finance. Earlier this month it reportedly poached 20 employees from New York-based online lending startup Bond Street — engineers, product developers, and risk and marketing specialists — presumably to build out a lending product.

    According to the research, published Tuesday, 46 percent of all of the firm’s jobs as of Sept. 14 are in technology, with the highest amount for core platform roles, followed by operations engineering and then equities technology.

    Source: Tearsheet

    Marcus is expanding in the U.K.

    Marcus, the online lending startup built inside the investment bank, has been growing tremendously in the eight months since it launched in October 2016. It has one product: a customizable personal loan for Prime borrowers, with at least a 660 credit score, of up to $30,000. It promises no fees and straightforward repayment terms. It recently passed $1 billion in loan originations with expectations to originate $2 billion by the end of this year. By comparison: SoFi, which launched in 2011, reached its first billion after 14 months; Avant, founded in 2012, took 28 months; 10-year-old Lending Club took 65 months; and Prosper, launched in 2006, passed $1 billion in 98 months.

    Goldmoney Inc. Adds Bitcoin and Ethereum to the Goldmoney Holding (Globe Newswire), Rated: A

    Goldmoney Inc. (TSX:XAU) (“Goldmoney”) (the “Company”), a precious metal financial service and technology company, today unveiled the addition of vaulted Bitcoin and Ethereum as secure and fully-reserved offline investable assets within the Goldmoney® Holding, a major enhancement that allows qualified clients to buy, sell, and exchange cryptocurrencies with nine global currencies as well as gold, silver, platinum and palladium bullion. With today’s launch, Goldmoney becomes the world’s first publicly traded and regulated financial service to offer insurable, auditable, and Anti-Money Laundering (“AML”) compliant exposure to cryptocurrencies.

    • Buying and selling of digital assets that are safely secured in vaulted cold storage. Cryptocurrency offerings currently include Bitcoin and Ethereum; additional leading digital assets will be added over time.
    • Funding of Goldmoney Holdings with 50 types of cryptocurrency, enabling wallet holders to sell a variety of cryptocurrencies and fund their Goldmoney Holding with fiat currency to access precious metals and other Goldmoney service offerings.
    • Will seek the establishment of peer-to-peer (“P2P”) lending capabilities on digital assets in partnership with Lend and Borrow Trust, allowing owners of Bitcoin and other assets to safely borrow against their positions.

    HNWs Would Use Amazon for Wealth Management (Financial Advisor IQ), Rated: A

    The majority of high net investors would turn to GoogleAppleFacebook and Amazon for wealth management, Bloomberg writes.

    If one of the four tech giants were to enter the advice space, 56.2% of wealthy individuals would entrust them with their money, according to a Capgemini survey of 2,500 individuals with a net worth of $1 million or more in North America, Latin America, Europe and Asia-Pacific cited by the news service. And among people under 40, more than 81% would use one of the four tech firms, according to the survey.

    Australia

    New fintech “Study Loans” aims to help cash-strapped students (Mozo), Rated: AAA

    It’s called Study Loans and is said to be the first online platform dedicated to providing loans to students for both vocational and higher education.

    Working closely with education providers, the fintech will track student performance and provide funds as you study through ‘tranches’ – which are based on the number of units you do and when they are completed.

    Think of tranches as a ‘pay as you go’ kind of deal. So whether you pass one unit or four, Study Loans will release the funds according to your course progression.

    Study Loans has raised $5 million debt equity so far, which is ready to be distributed as the first tranche to Aussie students who have already applied through the platform.

    Financing options for students: 

    • Student loans – Student personal loans are designed to help fund your education. They often have a more lenient application criteria and have lower interest rates than standard personal loans. But you are expected to make monthly repayments – so you’ll need to make sure your budget can handle the amount.
    • Peer-to-peer lending
    • HECS-HELP – This is a Government funded scheme for students enrolled in Commonwealth supported institutions with no real interest charged on the loan. You won’t have to pay your student fees upfront, however, you are expected to make repayments once you start earning a salary of $54,869.

    MONEFLY LAUNCHES FREE FINTECH PLATFORM WITH ENVESTNET | YODLEE FINANCIAL DATA (Yodlee), Rated: A

    Monefly is an innovative new Fintech platform in Australia, focused on providing tools and resources that empower its members to grow income, reduce expenses, build assets, eliminate debt and protect themselves from risk. Some of these exciting tools include free property valuations, automated budgeting, credit scores, bank account consolidation and much more.

    Monefly has partnered with Envestnet | Yodlee to help its members access comprehensive financial data available across banking and wealth management from over 15,500 data sources globally.

    The data being integrated into Monefly includes superannuation, cash, credit cards, personal debts, mortgages, assets, shares, real estate, credit scores and other investment data.

    India

    MyAdvo Ties Up with Online Loan Advisor Square Capital for Loan Services (newKerala), Rated: AAA

    MyAdvo, India’s leading Legal Tech Startup has entered into an agreement with Square Capital, the digital lending arm of India’s largest real estate transaction platform Square Yards to enable loan facilitation for lawyers on its panel.

    Square Capital currently facilitates USD 30- 40Mn(INR 200cr – INR 260cr) of loan disbursals every month, contributed majorly by secured mortgages spread across 50+ banking partners for their different products in home loan, loan against property and business loan.

    This exclusive tie-up will benefit MyAdvo registered lawyers in receiving immediate loan solutions without any hassle.

    Indians are warming up to robo-advisers (livemint), Rated: A

    Robo-advisers, or automated services based on computer algorithms, are catching on in the Indian market due to the relatively lower penetration of financial products in India compared to developed markets.

    According to a Business Insider Intelligence forecast, robo-advisers (with some element of automation) will manage investment products worth $1 trillion by 2020, which will go up to $4.6 trillion by as early as 2022.

    Scepticism notwithstanding, financial institutions in the country are realising the benefits of robo-advisory services by either building the product in-house or partnering with fintech companies to develop robo-advisers. Take the case of FundsIndia.com, which has a robo-advisory service for which it is forging partnerships with financial biggies. “We have a partnership with Axis Securities and one more company. There is a growing acceptance from the industry, and we are trying to enable better product design,” said Srikant Meenakshi, co-founder, FundsIndia.com. According to him, 15% of his company’s overall portfolio comprises robo-advisory services. Similarly, 5nance has an agreement with HDFC Mutual Fund for its robo-advisor.

    Robo-advisory start-up ArthaYantra uses a patented methodology called the Personal Financial Lifecycle Management on its online platform, Arthos. Since its launch in 2008, the site claims to have helped 120,000 customers across more 650 cities and 30 countries.

    Asia

    Singapore Cryptocurrency Firms Facing Bank Account Closures (Bloomberg), Rated: AAA

    Singapore banks have closed accounts of several companies which specialize in providing cryptocurrency and payments services, according to two local bodies which represent financial-technology firms.

    Chia Hock Lai, president of the Singapore Fintech Association, which has broader membership than Access, said some of his organization’s members also experienced account closures, though he didn’t provide figures.

    Access has 106 members and the Fintech Association has 185, though the two organizations said some companies belong to both groups.

    How technology drives a new Taiwanese banking landscape (The Asset), Rated: A

    According to Joseph Huang, president of E.Sun Bank, speaking in an interview with The Asset, payments is one area that every bank is looking to explore, although it does not generate huge profits for most banks.

    Banks are also more frequently working with technology companies. E.Sun Bank partnered with IBM Taiwan in building its digital branch, which opened in February 2017, making it the first digital branch in Taiwan. Similarly, CTBC partnered with LINE Pay to help merge its banking services with communication apps and social media.

    Taishin Bank’s e-banking application, Richart, which attracted over 120,000 subscribers, is targeting young Taiwanese users, while Cathay United Bank is also providing its products to retail customers through its platform My MobiBank.

    Authors:

    George Popescu
    Allen Taylor

    Thursday January 26 2017, Daily News Digest

    Fundrise

    News Comments Today’s main news: Lending Club charge-off rates increase from 4.2% to 6.2% from 09/15 to 09/16. Fundrise is crowdfunding under Reg A+. LandlordInvest offers first property-backed IFISA. Zopa cuts rates – again. Today’s main analysis: Savers want better returns more than FSCS protection. Today’s thought-provoking articles:  Funding Circle changes property loan prices. United States […]

    Fundrise

    News Comments

    United States

    • Fundrise is crowdfunding itself under Reg A+. AT: “Other RECF platforms like Sharestates and P2P platforms like Wellesley seek growth capital through 3rd party crowdfunding platforms. Instead, Fundrise is going to sponsor its own capital-raising push. Very interesting, and they have the chops to pull it off.” GP:” This is another flavor of p2p, it’s p2-to-equity-to-build-a- marketplace-lender-to-p. “
    • Lending Club charge-ff rates increase from 4.2% to 6.2% from 09/15 to 09/16 GP: “To me this is huge jump. I am glad they appear to have tightened their credit policies. I am surprised this is not picked up by more outlets. A must read article.”
    • Average student loan debt statistics. AT: “Interesting analysis of the highest and lowest student loan debt by state.”

    United Kingdom

    European Union

    India

    International

    United States

    Fundrise is Crowdfunding Itself Under Reg A+ (Crowdfund Insider), Rated: AAA

    Fundrise first filed a preliminary Form 1-A with the SEC at the end of December 2016. The filing was done under “Rise Companies Corp.” so it fell under the radar of many people.  The most recent version offering circular indicates that Fundrise wants to sell up to 1 million shares of their Class B non-voting Common stock.  The price per share is not yet available. Initially, Fundrise will limit the offer and sale of the shares to investors who have purchased investments sponsored on their platform.

    Since Fundrise’s launch, they have originated approximately $210 million in both equity and debt investments deployed across more than approximately $1.19 billion of real estate property. This amount alone makes it part of a select group of the largest online real estate marketplaces in the US. Their first five sponsored “eREITs” have collectively generated $119 million in investment as of the beginning of this year.

    Fundrise claims a compound annual growth rate of 780% – going from $0.9 to $70.9 million for a three-year period from January 2013 to December 2015.  For the 9 month period ending September 2016, Fundrise had year over year growth of 129% going from $45.1 million to $103 million. For the six months ended June 30, 2016, net revenue stood at $3.5 million.

    The average size of the real estate assets originated by Fundrise during the nine months ended September 2016 was about $5.7 million.

     

    What Investors Need to Know About Peer-to-Peer Lending (Yahoo! News), Rated: AAA

    “Investor performance is coming down for peer-to-peer loans because there’s a growing number of charge-offs where a bank or a lender can’t collect on the loan and then the loan is deemed worthless,” says Colin Plunkett, equity research analyst at Morningstar in Chicago.

    Plunkett cites Lending Club Corp. (ticker: LC), whose annualized charge-off rates increased from 4.2 percent to 6.2 percent in the personal loans-standard program and 5.9 percent to 11 percent for the personal loans-custom loans program from September 2015 to September 2016.

    Sid Jajodia, chief investment officer at Lending Club in San Francisco, says the lender updated its credit policy to tighten its thresholds to stabilize delinquency rates by not lending to as many borrowers who had high debt-to-income ratios and other risk factors. The standard loan program that includes borrowers with a FICO score of 660 and above is open to institutional and retail investors, but the custom loan program, which includes a riskier pool of borrowers with a FICO score of 600-659, is open only to institutional investors, Jajodia says.

    Investors need to decide if the borrowers have the long-term credit ability and a willingness to repay versus what was projected when the security was initially priced, says Burke Dempsey, managing director of investment banking at Wedbush Securities in New York. They also need to examine the trustworthiness of the loan originator and if that lending company has “the integrity and commitment to deliver a transparent and quality product to all parties, especially under pressure of high growth or a turn in the economy,” he says.

    Plunkett says it’s also important for investors to consider how a company makes its money. A key difference between Social Finance and Lending Club is how the companies maintain their balance sheets, he says.

    Andrew Crosby, a senior at the University of Puget Sound and president of Four Horsemen, says the nonprofit switched from using Prosper, after experiencing a 12.21 percent default rate, to Lending Club, which has netted an 8.38 percent default rate.

    Both Crosby and Livingston say they’ve also seen the industry migrate from offering loans for weddings, home improvement and college tuition to narrowly focusing on debt consolidation.

    Average Student Loan Debt Statistics (Money Saving Pro), Rated: A

    According to the Economist, current U.S. student loan debt exceeds $1.2 trillion, a staggering increase of over 300% for the past decade.

    Seven out of 10 graduating seniors at public and non-profit colleges had student loans in 2014, with an average debt of $28,950. This represents an increase of 2% over the Class of 2013.

    One driver of student debt is the skyrocketing costs of attending college. The average cost of a non-profit private four-year college for 2014-15 was $42,419, up from $30,664 from 2000-2001. Public four-year college costs expanded over the same period from $11,635 to $18,943, according to CNBC.

    Graduates of the class of 2014 in Delaware had the dubious honor of carrying the highest student debt load, averaging $33,808. New Hampshire, Pennsylvania, Rhode Island and Minnesota round out the five worst states for student debt, with an average indebtedness of over $31,000. These states tend to have a higher percentage of students carrying debt, for example, New Hampshire had a whopping 76% of students shouldering debt upon graduation.

    The best states for low student debt are led by Utah with an average of $18,921 for the class of 2014, with a relatively low 54% carrying some student debt. It appears that there is a little overlap with averages and the amount of students with debt. While states like States Utah, have lower percentages of students in debt, higher debt averages tend to have higher amounts of students with debt. The other states in the top five are New Mexico, Nevada, California and Arizona, with an average of $20,418 owed. These best states for student debt have an average of 52% of graduates saddled with student debt.

    United Kingdom

    P2P platform offers first property-backed IFISA (Professional Advisor), Rated: AAA

    Peer-to-peer (P2P) platform LandlordInvest has become the first provider to offer a property-backed Innovative Finance ISA (IFISA) after receiving HM Revenue & Customs approval as an ISA manager.

    The property-backed IFISA will allow savers to invest up to £15,240 in the current tax year – rising to £20,000 next year -in P2P loans secured by residential property. According to LandlordInvest, savers could earn between 5% and 12% tax-free returns a year.

    P2P investors face another Zopa rate cut (P2P Finance News), Rated: AAA

    ZOPA has lowered its lender rates by 0.2 per cent across all accounts, just four months since its last reduction, citing competition in the personal loans market.

    Access account lenders will see interest rates cut from 3.1 per cent to 2.9 per cent, Classic investors will see a drop from 3.9 per cent to 3.7 per cent, while Plus account holders will see targeted returns fall from 6.3 per cent to 6.1 per cent.

    Lender rates were last reduced in September, a month after the Bank of England cut interest rates.

    Funding Circle is Changing How it Prices Property Loans (Crowdfund Insider), Rated: AAA

    On Wednesday, marketplace lending platform Funding Circle announced changes as to how it prices property loans. The lender revealed that following a recent review of its property loan offering, it is increasing the interest rate on certain property loans and will begin to list some loans at a higher risk band than A+ or A.

    Explaining why it is making the changes, Funding Circle stated:

    Over the past three years, you have lent over £300 million to experienced property professionals, earning over £16 million in interest after fees and bad debt. This has provided us with an ever-growing source of property credit performance data, which we use to regularly review our credit assessment models and help us make even more accurate pricing and risk banding decisions.”

    Savers would choose better returns over extra FSCS protection (Financial Reporter), Rated: AAA

    Savers would rather get a better interest rate on their money than benefit from more FSCS protection, according to research from peer-to-peer lending platform RateSetter.

    According to RateSetter’s research, only 4% of people in the UK have more than £75,000 in savings and therefore stand to benefit from the increase in protection. More than two-thirds of people (67%) have £10,000 or less in savings.

    The FSCS limit was reduced from £85,000 to £75,000 in January 2016 following changes in the pound/euro exchange rate, but RateSetter research carried out at that time found that just a quarter of savers were aware of it.

    Asked whether they would rather have a more protection for their savings or earn a higher rate of return, the vast majority of savers favoured the latter, with 69% saying they would rather earn 1 percentage point more in interest than have an extra £10,000 of FSCS protection.

    Fintechs warned to expect tougher regulation (Financial Times), Rated: A

    The governor of the Bank of England has put banks and fintech companies on notice to expect tougher, more intrusive regulation as the use of disruptive technology in financial services becomes more sophisticated and widespread.

    Mark Carney, who is also chairman of the Financial Stability Board that makes recommendations to G20 nations, said on Wednesday that fintech could signal an end to the traditional universal bank model. He added that it could also increase “herding” risks and make the system more interconnected and complex.

    Mr Carney said on Wednesday that the burgeoning peer-to-peer lending sector, which in the UK now represents about 14 per cent of new lending to small businesses, “does not, for now, appear to pose material systemic risks”.

    Earlier on Wednesday, Bundesbank president Jens Weidmann, who is also involved in the FSB, echoed the views of his Bank of England counterpart, saying that while enhancements in financial technology could bring banking services to more people, they could also “exacerbate financial volatility”.

    Both Mr Carney and the Bundesbank president warned that there were risks emanating from the use of so-called robo-advice, where algorithms are used to manage risk.

     

    Peer to peer strikes a chord with younger generation (smallbusiness.co.uk), Rated: A

    The millennial generation are four times more likely to have money invested in peer to peer than people aged 55 and over, according to research from ThinCats.

    Hamstrung by rock-bottom interest rates for most of their adult lives, 4 per cent of 18-34-year-olds currently have money in the emergent peer to peer sector, compared to 1 per cent over-55s.

    A third (29 per cent) of the millennial generation cite the ability to cut out banks as the sector’s biggest attraction, while 28 per cent like that they can lend directly to businesses. A quarter (23 per cent) have had peer to peer recommended to them by a friend.

    One of the key reasons for the peer to peer demographic split could be appetite for risk adjusted rate of return. Younger investors place much greater emphasis in earning high returns in exchange for greater risk, with one in five (19 per cent) citing this as their primary motivation when investing, compared to only one in ten (9 per cent) over-55s.

    European Union

    Klarna CEO says Trump, Brexit could be good for business (Business Insider), Rated: A

    Despite his personal disappointment at Britain’s plans to leave the European Union, Siemiatkowski believes Brexit, along with President Trump’s protectionist rhetoric in the US, could actually be good for his business.

    “Isn’t it so sad that you’ve got the younger generation that has been brought up with the amazing promise of Europe. All of us have lived and travelled and worked where we want. Then the older generation decides, end of party — you’re going back to the old ways.”

    Securities lending market opening up to new structures (Global Investor Magazine), Rated: A

    The majority of market participants at Deutsche Borse’s Funding and Financing Summit are looking at alternative securities lending structures.

    Over 60% of the audience at the Luxembourg event this week claimed to be exploring new models as part of their financing efforts in the current low yielding environment accompanied by strict regulatory requirements.

    Centrally cleared stock loan trades (40% of the audience), principal lending, peer-to-peer trades and pledge structures (17%) are among the new routes being looked at as extensions or complete replacements of the traditional agent lender model.

    India

    Digital revolution spurs new ways for banks to assess risks (Money Control), Rated: A

    Increased regulations, demonetisation and the push towards Digital India have brought the country’s banking system and financial services sector into the limelight.

    With rapid advancements and huge inflow of data, having analytics and Big Data tools/services is now critical for any financial institution to be able to understand and analyse credit risk, fraud risk or to make more efficient, fast and profitable decisions.

    This is great news for FICO whose credit rating services would come in handy for institutions in the lending business.

    A growing consumption and shift to digital or disruptive modes of financial transactions like P2P lending, brings along risks like fraud, data theft and cyber crime.

    In a recent study by Kroll, global provider of risk solutions, when survey participants were asked what dissuaded them from operating in a particular country. About 19 percent of respondents stated they were dissuaded from operating in India because of digital fraud concerns, the second most after China (25 percent).

    Financial institutions can further increase revenues by deploying analytics frameworks to improve customer cross-sell, enhance acquisition effectiveness, increase wealth management, penetration in high net worth customers and staying more cautious of ‘riskier’ customers.

    International

    Onfido Offers 2 Billion Unbanked Individuals Worldwide Machine Learning-Based Solution (Crowdfund Insider), Rated: A

    Onfido, a global identity verification company, announced this week it is helping to bring financial services to the 2 billion unbanked individuals worldwide with its Machine Learning-based solution. The company stated it plans to use its proprietary technology to verify people’s identification by comparing an identity document to a selfie and is helping convert the previously unbanked for some fintech companies.

    Onfido, a global identity verification company, announced this week it is helping to bring financial services to the 2 billion unbanked individuals worldwide with its Machine Learning-based solution. The company stated it plans to use its proprietary technology to verify people’s identification by comparing an identity document to a selfie and is helping convert the previously unbanked for some fintech companies.

    Authors:

    George Popescu
    Allen Taylor