Thursday March 21 2019, Weekly News Digest

fintechs and personal loans

News Comments Today’s main news: BlockFi hits $25M in deposits in 2 weeks. Cash-back ETF injects trouble into ETF market. PeerStreet expands product line. Funding Circle fund higher impairments drag returns. Dianrong blames Chinese regime for troubles. Today’s main analysis: New home equity loans do not significantly alter credit scores. Today’s thought-provoking articles: SoFi Money review. Can Citi, JPMorgan beat […]

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fintechs and personal loans

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United States

United Kingdom

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United States

BlockFi Receives $ 25 Million in Crypto Deposits in Just 2 Weeks After Launching Lending Products (CryptoGlobe), Rated: AAA

BlockFi Lending LLC, a New York-based “secured non-bank lender” that provides cryptocurrency-backed loans in USD to digital asset investors, has revealed that its interest-generating deposit accounts have received over $25 million in cryptocurrency.

SoFi Money Review: Online Checking (Nerdwallet), Rated: AAA

SoFi Money is an online checking account by SoFi, a company best known for its student loan refinance loans. SoFi’s account has a top-of-the-line interest rate and no monthly or overdraft fees. There’s no free ATM network, but SoFi reimburses many third-party ATM fees and doesn’t charge its own. SoFi also boasts unique perks: free career counseling and financial planning sessions.

Can Citi and JPM beat FinTech Personal Loans? (PeerIQ Email), Rated: AAA

The personal loan market has grown rapidly since 2010 and the growth has been driven by FinTechs. 

Source: TransUnion, PeerIQ

“My Chase Plan” and “My Chase Loans” – a point-of-sale financing alternative and a personal loan product respectively – that will be offered to its existing credit card customers.

LendingTree Study Finds New Home Equity Loans Do Not Significantly Alter Credit Scores (LendingTree), Rated: AAA

Home prices in the United States have rebounded to new highs since the financial crisis. As a result, American homeowners are sitting on the largest amount of home equity in history — at just over $15 trillion dollars, according to the Federal Reserve.

  • The decline in scores averaged just 13 points. At the high end, scores declined by 24 in San Jose,Calif. The smallest decline was 5 points in San Diego. Borrowers had an average score of 735 to start, so the declines are quite negligible in terms of access to credit and may have marginal impacts on the cost of credit. The highest starting credit score was 752 in San Francisco, while the lowest was 712 in Indianapolis.
  • The decline took an average of 158 days to reach bottom, which is just over five months. St. Louis homeowners saw their credit scores reach their lowest points in an average time of 101 days (3 months), while the longest decline was for homeowners in Dallas at 211 days (7 months). Loans do not appear on credit reports immediately after closing. Typically, the lender starts reporting to the credit bureaus after your first payment, depending on the lender’s reporting cycle. Thus it may take about 60 days after closing or even longer for it show up and start affecting a score.
  • Scores recovered over an average of 163 days. This is also just over five months, so the time to fall and recover are about equal. The quickest time to recover was 102 days, or slightly over 3 months, in Cincinnati. Borrowers in Chicago had the longest recovery time of 243 days, just over 8 months.
  • Scores recover within a year and begin to move higher. The complete cycle to return to the credit score prior to the home equity loan takes 321 days, less than 11 months. The shortest cycle was in St. Louis at 211 days and the longest in Chicago at 443 days, about 15 months.

As Cash-Back ETF Hits Market, Signs of Trouble Start to Mount (Bloomberg), Rated: AAA

Last week, one ETF upstart created a minor splash by doing what was once unthinkable — offering to pay investors to buy into its exchange-traded fund. That comes on the heels of eight fund providers — including JPMorgan Chase, Vanguard and BlackRock to name a few — all slashing fees in one of the industry’s most aggressive rounds of price cuts to date.

The sub-zero fee giveaway by Salt Financial, which previously ran a single $11 million ETF, is widely seen as a marketing gimmick to drum up a little PR, get customers in the door and increase its assets under management. During the first year, investors will receive 50 cents for every $1,000 in a new low-volatility stock ETF — until it grows to $100 million. After a year, a management fee of 0.29 percent, or $2.90 per $1,000, could kick in.

The race to zero, however, is very real. Fidelity Investments jump-started the no-fee push in August by offering index funds for free. In February, SoFi said it would waive charges on two planned ETFs for the first year. Last week, JPMorgan started selling America’s cheapest-ever ETF for the princely sum of 20 cents for every $1,000 invested. And BlackRock unveiled plans Wednesday to cut fees for large clients in one of its S&P 500 indexed mutual funds.

PeerStreet Expands Product Line with Residential for Rent Loans (BusinessWire), Rated: AAA

PeerStreet, a platform for investing in real estate backed loans, today announced the launch of a new loan product for private lenders: Residential for Rent loans. Residential for Rent loans have a 30-year term so borrowers can secure long-term financing for residential rental properties. This launch is in response to key market conditions: as more people struggle to finance buying a home, the rental market has continued to grow.

3 Big Reasons To Fill Out The FAFSA (Even If You Think You Earn Too Much) (Huffington Post), Rated: A

One-quarter of families don’t complete the FAFSA, according to Sallie Mae’s 2018 How America Pays for College survey. Of those that don’t fill it out, 48 percent say it’s because they don’t believe they’ll qualify for financial aid.

But they’re often wrong: An analysis by NerdWallet found that in 2017, students left an estimated $2.3 billion in federal financial aid on the table by not filling out the FAFSA.

According to Elaine Rubin, senior contributor and communications specialist at private student loan marketplace Edvisors, most Americans are eligible for some type of federal aid. In fact, it’s available to anyone with a household income below $250,000 per year, CNBC reported.

Madden lawsuit nears end, but online lenders still seek fix from regulators (American Banker), Rated: A

An 8-year-old class action that wreaked havoc on the online lending industry is finally winding down, but the lobbying push in Washington to undo its impact shows no signs of abating.

Lawyers in the case have filed a proposed settlement that would provide $9.8 million in cash and debt relief to as many as 58,000 consumers, setting up the final chapter in a lawsuit that is likely to be remembered best for the legal precedent it established.

The State of Digital Engagement for Online Lending (LendIt), Rated: A

A recent trend report by Clarity Services, a credit reporting provider, showed that online funded loan volumes grew by almost 500% between 2013 and 2017.

How Far are Most in their Digital Transformation Strategy?

  • 54% of financial institutions have developed a digital strategy, but have not yet implemented it
  • 29% of financial institutions are currently developing a digital transformation strategy
  • Only 14% of financial institutions are in the process of implementing a digital transformation strategy

How Much Will They Be Investing In Digital Transformation in the Next 12-18 Months?:

  • 65% are planning to increase spending by 10%
  • 26% are planning to increase spending by 1-9%
  • 6% have no plans to change spending

What will They be investing in over the next 12-18 Months?

  • Replace or upgrade legacy IT systems — 88%
  • Reduce operational inefficiency — 76%
  • Improve customer experience — 74%

X Financial’s Fourth Quarter Results Take Stock 5% Higher (Capital Watch), Rated: A

The stock of X Financial (NYSE: XYF) jumped more than 5 percent Tuesday morning, to $6.55 per American depositary share, after the peer-to-peer lending marketplace announced improved revenue and profit for the fourth quarter, as well as a dividend for 2018.

The Shenzhen-based company, which connects borrowers and investors on its platform, reported in a statement Monday evening that its revenue grew 18 percent year-over-year to $125.5 million during the three months through December.

Its net income, X Financial said, was $35.2 million, or 22 cents per share, at a 53 percent increase from the same period of 2017.

Why Corporates Cant Fund Early Pay Programs (Dynamic Discounting + SCF) (Spend Matters), Rated: A

If you look at the graph below, 5% of S&P 500 companies hold more than half the overall cash; the other 95% of corporations have cash-to-debt levels that are the lowest in data going back to 2004, according to Wells Fargo research. We know who those 5% are — they are the GAFA companies: Google, Amazon, Facebook and Apple.

Source:

ZestFinance Using AI To Bring Fairness To Mortgage Lending (Forbes), Rated: A

Discrimination in lending has long been a problem, shutting minority groups out of the home buying process.

ZestFinance, the artificial intelligence software company focused on the credit market is trying to change that with ZAML Fair, a new software tool that aims to reduce the instances of biases and discrimination in lending.

CoreLogic Launches PanoramIQ to Provide More Accurate and Complete Property Insights (CoreLogic), Rated: A

CoreLogic, a global property information, analytics and data-enabled solutions provider, today announced PanoramIQ, an intelligent property solution that delivers a more complete view of property data with more current and reliable sources than public-record data alone. Utilizing a combination of public and proprietary property datasets, a unique property ID, machine learning and advanced analytics, PanoramIQ provides lenders, mortgage industry professionals and government entities with deeper, more accurate and complete property insights, allowing clients to make better decisions in a timely and efficient manner.

White Oak Healthcare Finance Launches Real Estate Investment Vehicle with New Hires (ABL Advisor), Rated: A

White Oak Healthcare Finance, LLC announced it will broaden its product offering and enter the healthcare real estate investment market.  White Oak hired Jeff Erhardt, Paul Nevala, Mike Treiber and John Brussard to build out the vehicle, which will initially invest up to $500MM and will focus on investments in seniors housing and skilled nursing properties using triple net leases and joint-venture RIDEA structures.

Banks seek Congress’ help to block fintech path to ‘industrial’ charters  (Roll Call), Rated: A

A bank industry group is lobbying Congress to block financial technology firms, such as online lender Social Finance Inc. and payment processor Square Inc., from obtaining an obscure form of a state bank charter that would let them operate nationally with little federal supervision.

The Independent Community Bankers of America last week distributed a policy paper around Washington calling for an immediate moratorium on providing federal deposit insurance to industrial loan companies, or ILCs, which are chartered by only a few states — most notably Utah.

Form S-3 Senmiao Technology Ltd (Street Insider), Rated: A

Approximate date of commencement of proposed sale to the public: From time to time after this registration statement becomes effective.

Debt Securities. We may offer debt securities, which may be secured or unsecured, senior, senior subordinated or subordinated, may be guaranteed by our subsidiaries, and may be convertible into shares of our common stock. We may issue debt securities separately or together with, upon conversion of or in exchange for other securities. It is likely that any debt securities issued will not be issued under an indenture.

Figure Technologies, Inc. Expands Leadership Team as It Builds Out Financial Empowerment and Wealth Offerings (PR Newswire), Rated: B

Figure Technologies, Inc., a fintech company in both the home equity and blockchain space, announces that John Sweeney has joined the company as the head of Wealth and Asset Management, along with Dr. Michael Dooley, who joined as chief economist. These hires reflect Figure’s commitment to empowering consumers and building out products to improve their financial well-being.

LendPro Hires Belinda Kelton as Vice President of Sales (LendPro Email), Rated: B

LendPro LLC, a provider of Lending-as-a-Service (LaaS) products and platforms for retailers, has hired retail industry veteran Belinda Kelton as its Vice President of Sales, the company announced today. Kelton is the latest of many new hires for the fast-growing fintech company, which recently moved to a new location to accommodate new staff members and provide the best service possible to customers.

Corporate Counsel, Commercial (Go In House), Rated: B

Affirm is looking for a business-minded Corporate Counsel, Commercial with broad expertise in complex commercial transactions. This role will report to Affirm’s Associate General Counsel.
United Kingdom

Funding Circle fund sees higher impairments continue to drag returns (AltFi), Rated: AAA

The Funding Circle SME Income fund saw just a marginally positive performance in February with Net Asset Value growth of just 0.05 per cent as impairments continued to hurt performance.

Impairments reduced NAV returns by 0.7 per cent in February, said analysts at Liberum, in line with the average monthly impairment rate of recent months.

Revolut Is Testing the Limits of Finance (Bloomberg), Rated: AAA

Storonsky is getting a taste of the scrutiny that lies ahead as he tries to upend the world of banking with Revolut, his 3-1/2 year-old startup. The U.K.’s financial regulator is examining why the digital bank last summer temporarily turned off a system designed to automatically block suspicious transactions.

It was valued at $1.7 billion at its last fundraising and now has over 4 million customers after new accounts tripled in 2018. That’s about three times more than the two lenders combined and the same number of customers as foreign-exchange business TransferWise, which is four years older.

Source: Innovate Finance

CrowdProperty launches equity sale after increasing loan book by £100m (PlaceTech), Rated: AAA

The specialist peer-to-peer lender has secured £100m of loan capital as it launches a public crowdfunding campaign, already oversubscribed, that values the business at more than £15m.

Having raised £100m from an unnamed “major institution”, CrowdProperty will use the funds to expand the number of property projects it backs over the next 12-24 months.

OakNorth reports £33.9m profit for 2018 and commits to donating 1% of all future net profit to charitable causes and social entrepreneurship (OakNorth Email), Rated: A

IFISA Guide: SME loans (P2P Finance News), Rated: A

Ablrate’s IFISA offers returns ranging between 10 and 15 per cent, enabling investors to fund asset-backed loans to UK businesses.

ArchOver’s IFISA enables investors to fund secured business loans and enjoy tax-free returns of up to 10 per cent per year.

MoneyThing’s IFISA is one of the highest-paying tax wrappers that invests in secured business loans, offering annual returns of up to  13 per cent.

Assetz Capital

Returns vary depending on the account, going from 4.1 per cent to 6.25 per cent on its auto-invest products, and up to 15.5 per cent with its manual lending option.

Funding Circle

The minimum investment in this flexible IFISA is £1,000.

LendingCrowd

The Growth and Income ISAs automatically spread investors’ money across a range of loans and have variable target rates of six per cent and 5.6 per cent, respectively.

Specialist lender funding will be the key issue for 2019 – LendInvest (Mortgage Solutions), Rated: A

The situation is a big reminder to lenders that it is crucial to concentrate on building a diverse range of funding sources, rather than just one single route.

It’s something that we have put a lot of work into at LendInvest, as it allows us to lend with confidence, knowing that the funds we have promised to a borrower will be there.

The firm sent out an email on 24 January 2019 suggesting that recipients should have a “stockpile ready” as some believe Brexit “could affect the amount of food available,” while offering a £5 promotional discount on a loan.

Why investors are fleeing the ‘fear and greed’ of stock markets for peer-to-peer loans (The Telegraph), Rated: A

Investors are ditching the stock market in favour of bundled loans sold by fledgling platforms that are yet to be tested by a financial crisis.

The top 20 UK places for high net worth earners (Citywire), Rated: B

Nearly two fifths of the UK’s top earners now live in London, according to research from peer to peer lending platform easyMoney.

China/Hong Kong

China’s Online Lender Dianrong Blames Chinese Regime for its Woes (NTD), Rated: AAA

Dianrong, one of China’s biggest peer-to-peer (P2P) lenders, is laying off staff and shutting stores. The company blamed the Chinese regime for its troubles and said the absence of clear-cut policies was proving to be a heavy burden.

Dianrong shut down 60 of its 90 offline stores and laid off an estimated 2,000 employees, Reuters reported in early March.

Pintec’s Stock Rises on Steady Results During Quarter of IPO (Capital Watch), Rated: A

Pintec Technology Holdings Ltd. (Nasdaq: PT) gained 15 cents in trading by midday after reporting a slight increase in revenue and narrowed losses for the fourth quarter.

The Beijing-based tech platform facilitating financial services said on Wednesday that its revenue in the three months through December was $32.9 million, 2 percent higher year-over-year. Its net loss was $1.2 million, a 10 percent decrease from the same period of 2017. Loss per share was 1 cent.

For the full year, Pintec reported revenue of $153.1 million, 85 percent higher from the preceding 12 months, and profit of $1.1 million in contrast to a loss in 2017.

KKR Raising First Asia Real Estate Fund, Targeting $ 1.5 Billion (U.S. News), Rated: A

Global investment powerhouse KKR & Co Inc is raising its first Asia-focused real estate fund, targeting $1.5 billion as it looks to deepen its real estate portfolio in the region, said people with knowledge of the matter.

Investment firms raised $18.6 billion in 26 Asia-focused real estate funds last year, the highest since 2008, according to data provider Preqin. KKR’s U.S.-based rival Blackstone Group raised the region’s biggest real estate fund last year at $7.1 billion.

China and distressed debt top DB’s hedge funds tastes test (City Wire Selector), Rated: A

Alternative investors are increasingly drawn to Asian hedge funds and distressed strategies, according to the latest Alternative Investment Survey from Deutsche Bank.

The 2019 survey canvassed the views of 425 asset allocators running $1.7 trillion of hedge fund assets in 28 countries.

European Union

Finnest and Invesdor Merge to Combine Debt and Equity Operations in Europe (Crowdfund Insider), Rated: AAA

Finnest, an Austria based Fintech that provides debt capital to small and medium-sized firms, has announced a planned merger with Finland based Invesdor Oy. The newly formed company will see the combination of a leading Nordic equity crowdfunding platform and a top online lender serving the DACH region (Deutschland, Austria, Switzerland). The two companies will now be able to offer a full stack of debt and equity services and investments across Northern Europe as well as more numerous options for investors.

Invesdor claims over 50,000 registered users as well as a MiFID II license for 28 European countries – the first crowdfunding platform to receive approval. Invesdor reports investors, both institutional and individual, from over 150 different countries. Invesdor currently offers a unique financing portfolio in the market, from equity to loans and bonds to IPOs.

Bitbond to Work with BitGo for Germany’s First Security Token Offering (Bitbond), Rated: A

Bitbond has launched Germany’s first Security Token Offering with a BaFin approved Prospectus and will be using  BitGo’s Business Wallet. The STO has a hard cap of EUR 100 million (~USD 113 million) and will conclude in May. Thousands of investors have already joined to take advantage of early bird discounts.

The STO marks a significant milestone for the crypto asset industry, not only because it has an approved prospectus, but also because it offers tokenized debt with a predetermined maturity. Bitbond Token (BB1) holders will receive quarterly and annual payments for 10 years, after which Bitbond will buy back the token at its original value of EUR 1 per token.

India

Top 5 sectors that need upskilling: How to stay relevant in age of disruption? (Indian Express), Rated: A

The banking sector is witnessing a massive growth owing to the launch of connected products and services, business innovation and the rise of the middle class along with the emergence of new fintech areas of mobile payments, digital wallets and P2P lending. Technologies such as chatbots, blockchains and automation through robotics powered by AI are transforming the sector.

CRYPTO EXCHANGE COINDCX RAISES SEED FUNDING FROM BAIN CAPITAL VENTURES (Coin News Span), Rated: B

Bengaluru-based client leasing startup RentoMojo has raised $10 Mn serial B funding from Bain Capital Ventures and Renaud Laplanche.

Asia

Look out for 2019’s top 7 lending startups (e27), Rated: AAA

As of 2019, there are still 2.45 billion underbanked and unbanked people in the world. The more innovative lending companies there are, the faster this market will be covered and served.

October.eu (formerly Lendix) is an innovative, easy-to-use, and intuitive peer-to-peer platform for lending and investing.

The Dharma team works on a platform that lets businesses build lending products on the Ethereum blockchain.

The governing idea of Kabbage is that funding shouldn’t be complicated for businesses. So, the company makes an effort to provide entrepreneurs with up to US$250,000 in loans for which you can allegedly qualify for in just 10 minutes or at most, a day.

Founded in 2014, TurnKey Lender has already become the market’s leading intelligent all-in-one lending automation platform.

The name SoFi comes from social finance and it’s another great example of a successful peer-to-peer lending operation. Founded in 2011, the company is already a huge market player with US$30 billion worth of funded loans and 600 thousand members.

Affirm goes a different route than most alternative lenders. The idea behind it is enabling in-house financing for retail businesses. So, the store’s customers get an instant loan with zero to 30 per cent interest rates.

With quite a unique approach, Lendio offers small business an opportunity to get services and credit products from lenders with the best conditions. It’s a marketplace with more than 75 lenders on board.

Vietnam is the region’s fintech hub (The ASEAN Post), Rated: AAA

Vietnam’s strong economic growth in recent years has led to the flourishing of the nation’s digital economy. The country’s economy in 2017 was deemed to be one of the best performing in the region. Its economy saw a 6.8 percent increase in gross domestic product (GDP) – higher than the government’s initial target of 6.7 percent – making it one of the fastest growing economies in Southeast Asia.

Vietnam currently has 54 percent of its population on the internet and the number is expected to grow further in the coming years.

Data from Vietnam Briefing shows that 39,580 start-ups entered the Vietnamese market in just the first four months of 2017, a 14 percent increase from the first quarter of 2016. Within the start-up scene, the fintech sector has become the most attractive for investments, receiving US$129 million in 2016.

Travelstop Targets Fintech SMEs with Business Travel Management Platform (Fintech News), Rated: A

Co-founded by former Expedia employees, Singapore-based Travelstop is a modern, artificial intelligence (AI) powered SaaS platform that simplifies business travel, automates expense reporting for businesses in Asia, and offers insights to business owners.

The platform is quickly gaining traction from the region’s startups and fintech community, helping small and medium-sized enterprises (SMEs) and high-growth organizations including Funding Societies, Fintech News Network, RedDoorz, S P Jain School of Global Management and Dot Property better to manage their business travels.

Asia has the largest share of mobile internet traffic, with 61% of its population using mobile devices to go online.

How Ovo Has Grown to be Indonesia’s Largest Digital Payments Platform (Entrepreneur), Rated: A

After online stores, Indonesia’s leading digital payments platform Ovo has been making strides into offline stores, increasing the number of merchants that accept the payment method.

OVO has reportedly acquired local peer-to-peer lending company Taralite, a move that will pave the way for OVO to branch out into the lending business which is seen to be a potential profit-generator for the company.

TurnKey Lender Opens a New Office in Kuala Lumpur (Digital Journal), Rated: A

TurnKey Lender, a provider of intelligent lending automation, decision management, and risk mitigation solutions, announces the opening of a new office in the capital of Malaysia, Kuala Lumpur. Its main goal will be to physically represent TurnKey Lender and support the company’s operations in Asia.

With internet penetration at 85.7% in 2018, the country is perfectly positioned for the rapid growth of alternative lending initiatives in areas like peer-to-peer lending and in-house financing.

Golden Gate Ventures ties up with Hanwha to invest in Asian startups (SDF-KH), Rated: B

Golden Gate and Hanwha will focus on startups that are raising fund for ‘Series B’ stage.

Singapore-based Golden Gate Ventures confirmed on Tuesday that it has teamed up with South Korea-based Hanwha Asset Management to invest in Southeast Asian technology startups.

Authors:

George Popescu
Allen Taylor

The post Thursday March 21 2019, Weekly News Digest appeared first on Lending Times.

Thursday September 6 2018, Daily News Digest

Purchase APR by Credit Score Range

News Comments Today’s main news: Varo Money gets preliminary approval for bank charter. SynapseFI raises $17M for banking platform. RateSetter ISA gets 130M GBP inflow in 8 months. Ex-Lloyds Banking boss set to make 3.3M GBP from Funding Circle float. LendInvest hits 1B GBP total lending. Today’s main analysis: International P2P lending volumes for August 2018. Today’s thought-provoking articles: […]

Purchase APR by Credit Score Range

News Comments

United States

United Kingdom

International

Asia

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News Summary

United States

Varo Money wins preliminary approval for US national bank charter (FinExtra) Rated: AAA

San Francisco-based fintech startup Varo Money has been granted preliminary approval for a national bank charter by the Office of the Comptroller of the Currency (OCC), paving the way for the creation of the first fully-licensed mobile-only bank in the US.

Co-founded by former Wells Fargo executive Colin Walsh, Varo Money has raised $79 million in funding over the past two years and currently provides a range of savings, loans and account-based services through a relationship with The Bancorp Bank.

The approval for a Federal banking charter will enable the firm to expand its portfolio of millennial-friendly financial products on a national scale, providing a wider range of services in all 50 states.

Four Things for FinTechs to Consider Before Filing a Bank Charter Application, says Auriemma Consulting Group (PR Web) Rated: A

Each FinTech now finds itself at a regulatory Rubicon: To either take control of its destiny by embracing one of the available bank charters, with all of the attendant compliance and regulatory challenges; or to remain a non-bank technology company, dependent on a bank partner or subject to multi-state laws.

Here are four of the most important factors for FinTechs to consider now:

  1. Determine the importance of interest rate exportation to your business.
  2. Consider the need for deposit funding.
  3. Consider the requirements of equity investors – now and in the future.
  4. Weigh the risk represented by a Bank Partner.

3 best pieces of career advice for young people from ex NFL and Twitter exec (NBC) Rated: AAA

Anthony Noto has had a star-studded corporate career.

He has been the chief operating officer of Twitter, the co-head of telecommunications, media and technology investment banking at Goldman Sachs and the executive vice president and chief financial officer of the National Football League. And currently, he is the chief executive officer at the online personal finance company SoFi, short for Social Finance.

  1. Fix problems, don’t pass the buck
  2. ‘Be a truth seeker’ so you can make the best decisions possible
  3. Focus on making your whole team better

SynapseFI raises $ 17M to develop its fintech and banking platform (Tech Crunch) Rated: AAA

SynapseFI, a startup that helps banks and fintech companies work together to develop technology, has announced that it raised a $17 million Series A funding round.

The funding actually closed at the back end of last year, but CEO Sankaet Pathak said the company has been so busy developing new products, hiring and more than that it is only getting around to disclosing the deal now. The investment was led by Trinity Ventures and Core Innovation Capital, with participation from other unnamed backers.

The San Francisco-based startup has sat under the radar for a while now despite starting up in 2014. Its core product is a platform that helps banks and developers work together. That involves developer-facing APIs that allow companies to connect with banks to offer services, and also bank-facing APIs that allow banks to automate and extend back-end operations.

The LendingTree Mortgage Offers Report contains data from actual loan terms offered to borrowers on LendingTree.com by lenders.

  • APR: Actual APR offers to borrowers on our platform
  • Down Payment: Though analogous to the LTV, we find that borrowers identify more closely with the down payment. Academic studies have also found that the down payment is the primary concern for homebuyers and one of the main impediments to entering the home buying market.
  • LTV: Actual LTV offered to borrowers on our platform
  • Loan Amount: The average loan amount borrowers are offered
  • Lifetime Interest Paid: This is the total cost a borrower incurs for the loan, inclusive of fees.
Source: Lending Tree

Credit unions split on potential threat posed by OCC’s fintech charter (Credit Union Journal) Rated: A

With the Office of the Comptroller of the Currency having approved a national bank charter for fintechs this summer, a host of insiders have weighed in on potential pros and cons, and how OCC’s move might ultimately impact credit unions.

“The threat to any financial institution, including credit unions, would be around the prospect of a fintech with compelling, modern technology and innovative approaches to traditional banking services becoming regulated and competing with CUs and banks,” said Michael Carter, EVP of digital practice for the Memphis-based Strategic Resource Management (SRM).

Ted Bilke, president of Symitar and VP of Jack Henry & Associates, said one charter “negative” could be enabling large players like Walmart and Amazon to “provide traditional depository and lending services” that compete directly with traditional credit union business.

Should You Take Out a Loan for Payroll? (NAV) Rated: A

When cash flow slows, becomes stagnant, or is otherwise disrupted (large purchases, overdue accounts, etc.), business owners can become vulnerable to a variety of financial woes. Bills can go unpaid, vendor relationships can become strained, and, if the problems persist, your credit can take a quick slide downward. Unfortunately, cash flow problems can also impact another essential part of your business – payroll.

Aside from leaving employees disgruntled, failure to meet your payroll obligations is considered a violation of the Fair Labor Standards Act (FLSA), which can result in penalties handed down from the Department of Labor.

Why can’t you make payroll? 

Though the exact reason for payroll problems can vary from business to business, there are typically two primary circumstances that leave business owners frantically trying to make good on this obligation:  changes in cash flow or unexpected expenses.

Americans Are Planning to Spend Less on Fashion This Fall; Many Are Embracing Alternatives to Cash or Credit Cards (Business Wire) Rated: A

Affirm, Inc., the company founded by entrepreneur Max Levchin to provide fair and honest alternatives to traditional credit, today announced the “Shop with Affirm” fall fashion campaign and released the findings of a new survey revealing how Americans plan to shop and pay for apparel purchases this fall.

Starting in September, Affirm will feature fashion and apparel brands that partner with Affirm across Instagram and Affirm.com, showing consumers where they can buy now and pay for purchases over time with Affirm. Many fashion brands now give customers the option to use Affirm to buy items with no interest, repaid in three easy monthly installments.

The campaign was designed to make great brands accessible to more customers, offering a transparent payment option that better aligns with shoppers’ cash flows and helps them budget for fall purchases.

White Oak Healthcare Finance Closes $ 20 Million Financing For Fox Rehabilitation (Business Wire) Rated: B

White Oak Healthcare Finance, LLC (“White Oak”), today announced it acted as sole lender and administrative agent on the funding of a $20 million asset based senior credit facility for Fox Rehabilitation, Inc. (“Fox”). The funds were primarily used to refinance existing indebtedness and support continued growth.

Fox provides physical, occupational and speech therapy services to help geriatric patients regain a better quality of life. “We are excited to partner with a practice that is so highly focused on clinical outcomes. By investing in people and processes, Fox has demonstrated the unique ability to maintain continuity of care while expanding throughout the country,” said Ross Eldridge, Managing Director at White Oak.

United Kingdom

RateSetter ISA sees £130m inflows in eight months (Altfi News) Rated: AAA

Peer-to-peer lender RateSetter has seen a inflows of more than £130m into its Innovative Finance ISA in just eight months.

The firm, one of the three largest P2P lending platforms in the UK, launched its IFISA to existing customers in February and new customers in March. Like its peers Funding Circle and Zopa, the platform was fully regulated and therefore able to launch an IFISA later than many of its smaller peers.

John Battersby, head of communications at the firm, says that demand has been higher than expected for Ratesetter’s ISA.

Disgraced ex Lloyds Banking boss set to make £3.3m when web-based lender Funding Circle floats (This is Money) Rated: AAA

The disgraced former boss of Lloyds Banking Group could make millions of pounds when fintech darling Funding Circle lists on the stock market in the coming weeks.

Eric Daniels, who orchestrated Lloyds’ disastrous takeover of rival HBOS during the financial crisis which left the bank in need of a £20billion taxpayer bailout, is an investor and director at the peer-to-peer lender.

He owns a 0.2 per cent stake in the business, which looks set to be worth £3.3million when it joins the stock market.

Funding Circle “Go further” by Lucky Generals (Campaign) Rated: A

Funding Circle, the small business loans platform, breaks the functional conventions of most financial services advertising in its second TV campaign.

 

LendInvest’s Total Lending Capital Hits £1 Billion as Fintech Raises £150 Million in Residential Development Funding in New JV (Crowdfund Insider) Rated: AAA

LendInvest, an online property finance platform, reports it has secured £150 million of “initial funding” in a new joint venture with Nomura, a global investment bank,  and Magnetar, an alternative investment manager. This new capital infusion now places LendInvest’s total capital for lending at around £1 billion. The JV with LendInvest will see the funding used for residential development finance.

Nomura is a Japan headquartered financial services group with an integrated global network spanning over 30 countries. Magnetar, based in the US, is a $13.7 billion investment manager that seeks to achieve stable risk-adjusted returns by opportunistically employing a wide range of fixed income, energy, quantitative and fundamental investment strategies.

Proposed investor restrictions threaten P2P sector’s growth (Peer2Peer Finance) Rated: A

THE PEER-TO-PEER lending industry has blasted the City watchdog’s proposed investor restrictions as unfair, costly and damaging to the sector’s future.

P2P platforms have been busy digesting the Financial Conduct Authority’s (FCA’s) long-awaited post-implementation review of the sector – released over the summer – and while most are happy with plans for heightened transparency and loanbook disclosure, there are concerns over proposed marketing restrictions and appropriateness tests  for investors.

These proposals would make P2P lending platforms become the preserve of sophisticated, high-net-worth or ‘restricted’ investors, akin to crowd bond providers like Abundance and alternative investment firms such as Goji.

WELENDUS LAUNCHES INDUSTRY-FIRST 15% RETURN ISA PRODUCT (Fintech Finance) Rated: A

Welendus, the FCA-approved Peer-to-Peer (“P2P”) lender, today announces the launch of an industry-first; it’s HMRC-approved Innovative Finance ISA (“IF-ISA”), which will allow investors to invest their annual ISA allowance in a flexible high return investment product, with no income tax on the interest earnings. This product will be the first ISA product on the market with up to a 15% return.

The UK’s short-term lending market is now worth £3.7 billion per year[1], however new innovative products have been few and far between, leaving great opportunity for disruption and innovation. In addition, the UK’s P2P lending market is expected to exceed £10 billion this year, and up to £19 billion by 2020.

Buy to let Britain: A divided nation sell or stay? (Property Reporter) Rated: A

Britain’s buy-to-let landlords are divided over their future, in light of tax and market changes – according to latest research from property-backed P2P lending product, Octopus Choice.

While three in five buy to let investors (56%) want to keep or buy more rental properties, two in five (44%) are looking to sell. The majority of UK landlords still view it as a money-making asset class but think it will be on the decline in the future. As the market consolidates, buy to let owners are polarized across the country, with tough decisions to make on whether to stay or leave the sector.

For those looking to exit the market, nearly a quarter blame falling yields (24%) and tax changes (23%), while a fifth blame cooling house prices (19%). Three in five (60%) say that property management had become a burden and 61% undervalued the costs involved.

Charlotte Rogers: The demise of Wonga shows toxic brands will always fail (Marketing Week) Rated: A

At one point Wonga was the UK’s biggest payday lender and tipped for a $1bn listing on the New York Stock Exchange, but it collapsed under the weight of compensation claims from customers who had been mis-sold loans and has not done enough to repair the damage.

Some 200,000 customers who owe an estimated £400m in short-term loans are still being asked to make repayments to the company, despite the fact compensation claimants are unlikely to ever receive a full pay-out.

The current reality is a world away from 2008, the year Wonga launched. The company positioned itself as a flexible digital alternative to banks and as an option for people looking online for a financial fix in 15 minutes.

Taking a cheeky and brash tone, the loans firm invested heavily in marketing to raise its brand awareness. Wonga’s advertising spend rocketed from £22,000 in 2009 to £16m by 2011, according to estimates by analysts AC Nielson MMS.

In 2010, Wonga made its first high profile move into sponsorship, teaming up with Transport for London to sponsor five hours of free late-night travel on New Year’s Eve. That same year the company made its first foray into the world of sports through a shirt sponsorship deal with Blackpool FC, which it would continue until 2015.

The PRS in a divided Nation – 44% say sell and 56% stay (Property 118) Rated: A

Britain’s buy-to-let landlords are divided over their future, in light of tax and market changes with 56% buy to let investors wanting to keep or buy more rental properties, and 44% are looking to sell. This is according to latest research from property-backed P2P lending product, Octopus Choice.

The majority of UK landlords still view it as a money-making asset class, but think it will be on the decline in the future. As the market consolidates, buy to let owners are polarized across the country, with tough decisions to make on whether to stay or leave the sector.

Meet the Wonga wannabees: Britain cheered when its biggest payday lender went bust last week… But beware its rivals still out there (This is Money) Rated: A

Wonga is no more — but there are still dozens of other payday loan firms out there.

So who are the Wonga wannabes?

SUNNY LOANS

Borrowers can apply for a loan of between £100 and £2,500.

The standard representative APR is 1,293 per cent, with risky borrowers charged up to 1,617 per cent.

QUICKQUID

Owned by parent firm Cash- EuroNet UK, QuickQuid has been trading since 2007 and offers loans up to £1,000 for new customers — £1,500 to those returning.

PEACHY

It offers loans of between £100 and £1,000 for between one and 12 months.

MR LENDER

It offers loans of between £200 and £1,000 over a term of six months.

Its typical APR is 1,256 per cent and maximum is 1,462 per cent. Borrow £1,000 over six months at the standard rate and you would repay a total of £1,815.

MYJAR

Based in Westcliff-on-Sea, Essex, Myjar launched a decade ago and offers loans of between £100 and £7,200 over three, six, 12 or 24 months, with a maximum interest rate of 1,326 per cent.

China

Slow-Motion Crash Sees Chinese Auto Stocks Skid 40% This Year (Wall Street Journal) Rated: AAA

A plan by Great Wall Motor Co. GWLLY -4.12% to offer discounts of between 11% and 27% on its cars has helped trigger a round of selling this week, according to analysts at Deutsche Bank.

Source: Wall Street Journal

Dongfeng Motor Group Co. DNFGY 8.84% Geely Automobile Holdings Ltd. GELYY -0.90% andGuangzhou Automobile Group Co. 2238 -2.97%—among the largest Chinese auto makers listed in Hong Kong—have each dropped by between 4% and 7% in the last two days of trading.

Combined, the trio have lost nearly 194 billion Hong Kong dollars (US$24.8 billion) in market capitalization this year, Datastream shows, while a Thomson Reuters index of Hong Kong-listed auto and truck manufacturers is down 39%.

Vehicle purchases are on the decline: In July, new car sales were 5.5% lower than in the same month last year. Sales of insurance policies are also falling. Peer-to-peer lending for car purchases had become increasingly popular, but after a series of lending scandals the government has cracked down.

International

International P2P Lending Volumes August 2018 (P2P Banking) Rated: AAA

Source P2P Banking

Startup Influx into Fintech: Is There Still Space for Growth? (Equities) Rated: AAA

We need to understand that the fintech industry is extremely broad, and the user base does not fit into a single category. Therefore, the applications of financial technology will find relevance in many spheres. This is one of the factors that have accounted for a massive growth in the number of fintech startups across the world. It is estimated that the number of startups in the fintech space has increased 8-fold; from an estimated 1000 companies in 2005 to more than 8000 companies in 2016.

Source: Equities

The fintech industry is still in a growth phase and therefore there is every possibility that we will continue to see an increase in the number of startups jumping into the fintech space. However, the emerging markets will see more of the increase in the number of startups due to the underserved nature of these markets.

ACORN OakNorth Holdings closes $ 100m round as business continues to grow ahead of plan (Fintech Finance) Rated: A

ACORN OakNorth Holdings has today announced that it has secured $100m from the EDBI of Singapore, NIBC Bank, Clermont Group, GIC, and Coltrane Asset Management. The $100m represented 4.3% of the company. The capital will be used to accelerate the growth of ACORN machine and enable OakNorth to continue scaling its lending efforts in the UK.

Meanwhile, ACORN machine has opened offices in New York and Singapore to service clients across multiple continents and will have over $5bn of assets under service on its platform by year end. NIBC Bank is the platform’s first client in the Netherlands. ACORN machine’s team now consists of almost 100 people and in the short term expects to add another 50 people across growth and operations, engineering, machine learning and data science.

Biz2Credit Launches New Virtual CFO for Small Businesses (Crowfund Insider) Rated: A

Biz2Credit announced on Wednesday the launch of its BizAnalyzer Virtual CFO, which is described as an advanced software tool that enables business owners to make smarter financial decisions about their companies. According to Biz2Credit, the virtual CFO software is available to clients of Paychex Promise, a subscription-based service from Paychex, a provider of integrated human capital management solutions for payroll, HR, retirement, and insurance services.

Australia

Lender produces guide to business loans (Broker News) Rated: A

An online lender has released a free eBook to help brokers move into writing unsecured online business loans.

The ‘Guide to Online Business Loans’ is the first comprehensive guide to alternative lending produced by a fintech lender in Australia.

It was created to overcome barriers such as a lack of education and knowledge of the industry, to help brokers diversify.

India

P2P lending: How the Rs 10 lakh cap will affect small businesses? (The Economic Times) Rated: AAA

If you are salaried and earn up to Rs 20,000 every month, cold calls and emails from banks for pre-approved personal loans is a regular thing. But for someone planning to open a franchise store or start a catering business, getting an unsecured loan is not easy. Banks and NBFCs are reluctant to fund businesses or expansion plans of MSMEs/SMEs or proprietors.

This could be due to factors like lack of credit data, remote location or poor education. Banks and financial institutions require an individual to display established source of income, thus leaving about 80 percent of the population with no access to credit.

The Peer-to-peer (P2P) online platform aims to bridge the gap between people who can lend and those who want to borrow without any security. The P2P industry took its first baby step in October in the form of RBI regulations which allows high-end investors to lend their money to low-end borrowers.

Asia

The evolution of sme financing (The Business Times) Rated: AAA

This gap in payments in certain industries can be up to several months, such as in the construction sector. When unexpected crises hit, such as late payments by customers or budget overruns during projects, businesses without adequate financing can be left high and dry.

With so much at stake, SMEs need to ask themselves if their current financing facilities are adequate for their needs and future expansion.

While the SME Financing Survey suggests that SMEs do not have a serious problem with getting external debt financing as 90 per cent of SMEs were successful in securing loans in 2017, other SME surveys indicate that financing is still a top concern by this particular segment. In a separate SME Development Survey 2017 by DP Info, 35 per cent of SMEs cited facing financing concerns – up from 22 per cent in 2016 and 14 per cent in 2015.

Kristine Ng: Fundaztic’s SME Lifeline to Plug the RM80 Billion Funding Gap (Awani Review) Rated: A

Kristine Ng understands very well the struggles SMEs go through to obtain financing. She spent a decade in the banking sector – five with Credit Guarantee Corporation (CGC), which was set up with the sole objective to help SMEs obtain credit facilities by providing guarantee schemes.

Recognising the need to plug the funding gap, particularly among smaller and micro enterprises. Kristine left her corporate career to start to start peer-to-peer (P2P) platform Fundaztic with a team of senior level ex-bankers.

Hard cash (Business Times) Rated: A

Indonesian ride-hailing and online payment company GO-JEK is expanding its financial technology services through partnerships with three peer-to-peer (P2P) lending firms: Findaya, Dana Cita and Aktivaku.

GO-JEK’s payment system GO-PAY launched last year, accounting for more than half of the startup’s transactions. The company integrated GO-PAY into the GO-JEK app, enabling customers to store money on their mobile phones — similar to a digital debit card. Adding to the GO-PAY account can be done from a bank account or ATM. If customers don’t have a bank account, they can hand cash over to GO-JEK’s drivers, and it will be transferred immediately to their account.

MENA

New Report Trails the Rise of Israeli Fintech (C Tech) Rated: AAA

Over the last 18 months, 16 multinational financial firms started operating in the Israeli tech system, or increased their local footprint through strategic partnerships and investments, according to a new report by Start-Up Nation Central (SNC), a nonprofit working to promote Israeli tech.

Newcomers include French insurance firm AXA SA, Bank of Montreal, Fosun, TD Bank, AmTrust, and Mastercard.

Authors:

George Popescu
Allen Taylor