- Today’s main news: Square, eBay partner on businesss loans. BNP Paribas launches UK fund for SME lending. Crowdstacker seeking 800K GBP on Seedrs. PPDAI to boost tech investment. Alipay, WeBank competition heats up.
- Today’s main analysis: The good news and bad news about Lending Club.
- Today’s thought-provoking articles: Americans are splurging on personal loans. How irresponsible mortgage lenders created a second housing bubble. BlockFi snags $52.5 million for cryptoasset-backed loans.
- Square, eBay partner on business loans. This is an interesting arrangement. We don’t typically think of eBay as a lender. This could be a punch at Amazon and PayPal.
- The good news and bad news about Lending Club. Very insightful look at Lending Club pre- and post-IPO.
- Americans are splurging on personal loans. And it’s all Lending Club’s fault. Or, more generally, online lenders, says Quartz.
- How irresponsible mortgage lenders created a second housing bubble. Again, it’s all SoFi’s (aka online lenders) fault.
- BlockFi raises $52 million for cryptoasset-backed loans. Crypto lending is picking up, and this could be the next field of battle for fintech lenders.
- Interview with Mike Cagney. Here, he talks about his new blockchain project.
- Could blockchain and fintech lending drive the housing market?
- Even raises $40 million.
- LoanSnap picks up $8 million.
- Tally raise $25 million.
- ArborCrowd sells Southern States Multifamily Portfolio.
- Lendio sees 90% growth in year-over-year revenue.
- P2P auto lending will be huge.
- Whitepages Pro releases global identity review solution powered by machine learning.
- Non-prime consumers spend more responsibly on vacation.
- Crowdstacker seeks 800,000 GBP through Seedrs.
- BNP Paribas launches UK fund for SME lending.
- Lend academy podcast with iwoca CEO Christoph Rieche.
- The P2P property maze.
- Goodlord forms open banking partnership with TrueLayer.
- Starling Bank rolls out new credit card design.
- PPDAI to boost technology investment.
- Alipay, WeBank competition heats up.
- Zennon Kapron on what’s next for fintech.
- P2P lending dominoes continue to fall.
- Guangzhou controller disappears.
- International: MoneyGram, Visa partner on real-time global P2P payments.
- Germany: FinLeap partners with SolarisBank on small business startup.
- The Netherlands: Rabobank’s approach to protecting consumer data.
- Australia: Property Connect enters tech agreement with Clearmatch to market new lending products.
- India: Monexo partners with Cube Wealth.
- United States
- eBay & Square Partner on Business Loans (Crowdfund Insider) Rated: AAA
- Lending Club: There’s Good News And There’s Bad News (Seeking Alpha) Rated: AAA
- Americans are splurging on personal loans thanks to fintech startups (Quartz) Rated: AAA
- How Irresponsible Mortgage Lenders Created A Second Housing Bubble (Seeking Alpha) Rated: AAA
- A Conversation with Figure’s Mike Cagney (Financial Revolutionist) Rated: A
- Could Fintech & Blockchain Lending Further Drive The Housing Market Boom? (Forbes) Rated: A
- Employer-focused PFM company gets $ 40 million (Business Insider) Rated: A
- Fintech Startup LoanSnap Raises $ 8m in Series A Financing (Finsmes) Rated: A
- BlockFi Raises $ 52.5M for Cryptoasset-backed Loans (Business Wire) Rated: AAA
- Credit Card Payoff App Tally Raises $ 25 Million (Cheddar) Rated: A
- Southern States Multifamily Portfolio Sells, Exceeding Targeted Returns for ArborCrowd Investors (The Daily Times) Rated: A
- Lendio Reports Q2 Results: 90% Year-Over-Year Revenue Growth (Lendio) Rated: A
- GM Maven CEO: Peer-To-Peer Auto Lending Will Be A Large Market (Bloomberg) Rated: A
- Whitepages Pro Unveils Pro Insight, a Global Identity Review Solution Powered by Machine Learning (Global Newswire) Rated: A
- Center For The New Middle Class: Non-Prime Consumers Spending More Responsibly On Vacation (Payment Week) Rated: A
- United Kingdom
- P2P Lender Crowdstacker Now Seeking £800,000 Through Seedrs Funding Round (Crowdfund Insider) Rated: AAA
- BNP Paribas launches UK fund for SME lending (FinTech Futures) Rated: AAA
- Podcast 159: Christoph Rieche of iwoca (Lend Academy) Rated: A
- Navigating through the P2P property maze (Peer2Peer Finance) Rated: A
- London Proptech Firm Goodlord Forms New Open Banking Partnership With TrueLayer (Crowdfund Insider) Rated: B
- Starling Bank takes on Monzo with daring debit card design (FinTech Futures) Rated: B
- PPDai to boost technology investment (Shine) Rated: AAA
- Alipay and WeBank competition heats up as China reins in leverage (Financial Times) Rated: AAA
- Zennon Kapron on what’s next for Chinese fintech (China Economic Review) Rated: A
- China’s P2P Online Lending Dominoes Continue to Fall (Ciaxin) Rated: A
- Chinese P2P Lender’s Controller Disappears After Sponsoring Portugal (Yicai Global) Rated: A
- European Union
- FinLeap Partners With Fabrick to Launch Financial Management Startup for Small Businesses (Crowdfund Insider) Rated: AAA
- Rabobank’s novel approach to protecting customer data (American Banker) Rated: A
- MoneyGram And Visa Team To Deliver Real-Time Global P2P (PYMNTS) Rated: A
- Property Connect enters technology agreement with Clearmatch to market new lending products (Small Caps) Rated: A
- P2P lending platform Monexo partners with Cube Wealth for new-clientele (Business Standard) Rated: B
eBay & Square Partner on Business Loans (Crowdfund Insider) Rated: AAA
eBay (Nasdaq:EBAY) and Square Capital (NYSE:SQ) have signed an agreement to provide up to $100,000 in credit to sellers – in as little as one day. The partnership is not only a streamlined offering of financing for small businesses that use eBay but also a whack at traditional banks which are mostly unable to match such a speedy lending agreement.
Scott Cutler, Senior Vice President, Americas at eBay, says that eBay is committed to helping their sellers and providing credit in partnership with Square simply makes sense.
Lending Club: There’s Good News And There’s Bad News (Seeking Alpha) Rated: AAA
For example, if you have $30,000 CC debt and good credit you can get a 3-year payoff at about 6% and a 5 year at about 7%. That is a big improvement over a typical rate of 17.5% on purchases and an amazing 23.5% on cash advances. So you take out the $30,000 loan, pay off your credit cards and save thousands in interest while you are at it. In addition, your CC is now zero and you can start using it again.
They came to market via an IPO late in 2014 and were an immediate hit rising over 50% their first day. They were immediately valued at over $9 billion. Today they are at less than $2 billion, a drop of almost 80%.
And finally here is LC’s chart since the IPO. Talk about ugly.
Americans are splurging on personal loans thanks to fintech startups (Quartz) Rated: AAA
The stock of personal loans outstanding has grown to about $120 billion as of March, according to TransUnion data. That compares with $71.9 billion a decade ago—worth around $90 billion adjusted for inflation—when the subprime mortgage crisis crescendoed. About 17 million Americans have this type of debt which, unlike mortgages and automobile loans, isn’t collateralized by an asset.
Upstart financial technology companies like Lending Club, Prosper, and Avant account for about a third of this lending, up from less than 1% in 2010.
How Irresponsible Mortgage Lenders Created A Second Housing Bubble (Seeking Alpha) Rated: AAA
Rents Are Falling, But Prices Are Surging
I believe the culprit is a new crop of lenders who are outside of Fannie Mae and Freddie Mac regulations on FICO scores and DTI. For example, San Francisco lender Social Finance (SoFi) is offering up to 3 million dollar loans with 10 percent down and “flexible DTI.“
Firms like SoFi are the engine driving the madness in the California housing market. Here’s what Michael Tannenbaum, former Vice President of SoFi, had to say about their loans in 2016, “Sixty-five percent of the business we do is first-time home buyers; it’s a big deal we’re opening up to the jumbo first-time market.” A year later, he was gone. Other gems from the San Francisco Chronicle article – SoFi’s average loan at the time was $800,000 and two-thirds were in California. I shudder to think what their average loan size and DTI is now. Also, in addition to not being big fans of debt to income ratios, SoFi isn’t big on using other traditional measures like FICO scores to evaluate borrowers. In 2016, they declared their company a “FICO Free Zone” in a press release. Said a former business development associate, “The volume of applications coming in was crazy.” Other sources reported on the wild sex culture at the firm. As for their underwriting practices? As long as housing prices went up, they were more or less irrelevant. But, if prices go down, SoFi and their backers stand to lose a lot of money.
A Conversation with Figure’s Mike Cagney (Financial Revolutionist) Rated: A
Mike Cagney’s return to fintech’s center stage had been foreshadowed by a handful of reports suggesting that his new company would be focused on the origination of real estate-related assets and that, somehow, blockchain would figure into the mix. But Cagney, who played a foundational role in building SoFi into one of fintech’s biggest success stories before his departure, isn’t the type of entrepreneur who thinks small and nichey. With his new company, Figure, and the blockchain protocol it has built, Provenance, Cagney and his team of 80 professionals are taking aim at the gigantic world of institutional capital markets transactions. Why? Because that’s one place where the vig (i.e., rent-seeking) still sloshes around in copious amounts. But unlike SoFi, which is taking aim at banks, Cagney is now fixing his gaze on the administrators, trustees, custodians and other intermediaries who take a cut out of each securitization and other types of deals. On the eve of the first transaction to be put on Provenance (a HELOC), The FR’s Gregg Schoenberg sat down with Cagney to learn more about his plans and how blockchain is central to his mission.
Those who do not have the scores to secure loans from traditional lenders now have alternatives particularly in the form of P2P lenders. These platforms pool together money from interested investors and loan them out to borrowers.
They also have a much quicker turnaround compared to what customers might experience with banks and other large lenders. While these services started out only to fund smaller personal loans, some like LendingClub have grown and expanded to allow larger-value loans like mortgages to be made on the platform.
Blockchain-based lenders have built upon this crowdfunding concept and enhanced it with blockchain’s capabilities with smart contracts and tokenization. While initial efforts as espoused by the likes of
Employer-focused PFM company gets $ 40 million (Business Insider) Rated: A
US-based personal finance management (PFM) company Even has raised a $40 million Series B funding round led by Keith Rabois of Khoshla Ventures, and including Valar Ventures, Allen & Company, Harrison Metal, Ron Conway, and Silicon Valley Bank.
Even integrates with attendance, payroll, and banking systems to help consumers improve their financial health. Its features include Instapay, which enables users to request the money they have earned before their actual payday, and it uses AI to give users an “okay to spend” amount, so they don’t get surprised by sudden expenses. Additionally, it offers an automatic savings feature, similar to other PFM companies including Acorns and Cleo.
Fintech Startup LoanSnap Raises $ 8m in Series A Financing (Finsmes) Rated: A
LoanSnap, a San Francisco, CA-based developer of technology that protects people against dumb loans, raised $8m in Series A financing.
The round was led by True Ventures with participation from Baseline Ventures, Richard Branson’s Virgin Group, Core Innovation Partners, Joe Montana’s Liquid 2 Ventures, OVO Fund, Transmedia Ventures, and angel investors.
BlockFi Raises $ 52.5M for Cryptoasset-backed Loans (Business Wire) Rated: AAA
BlockFi, the leading cryptoasset to USD lender, announced today it has raised $52.5M to expand operations. Galaxy Digital Ventures LLC, a digital currency and blockchain technology investment firm founded by Mike Novogratz led the deal. This marks the industry’s first institutional investment in cryptoasset backed loans. BlockFi’s existing investors, which include ConsenSys Ventures and PJC, also participated in the funding round.
- BlockFi planning rapid expansion of cryptoasset-to-USD lending platform
- BlockFi partners with Galaxy Digital Lending LLC on loan purchasing facility and receives equity investment from Galaxy Digital Ventures LLC
- Marks first institutional investment in cryptoasset backed loans
Credit Card Payoff App Tally Raises $ 25 Million (Cheddar) Rated: A
Tally, an automated debt-managing app, has raised $25 million in Series B funding with the goal of expanding its reach and finding new ways to alleviate consumers’ financial anxiety, Cheddar has learned.
Southern States Multifamily Portfolio Sells, Exceeding Targeted Returns for ArborCrowd Investors (The Daily Times) Rated: A
ArborCrowd (the “Company”) today announced its Southern States Multifamily Portfolio (SSMP) investment has been realized ahead of schedule, outpacing targeted return estimates. One of the properties in the portfolio is located in Mississippi and sold in late 2017. The two remaining properties, located in Alabama, recently sold. The aggregate portfolio sales price was $25.85 million, generating an internal rate of return (IRR) of over 29% for ArborCrowd investors.
The transaction marks the first of ArborCrowd’s six deals to complete its investment cycle, and its success is a great sign of the long-term viability of the Company’s growing platform. The SSMP investment opportunity was quickly oversubscribed when ArborCrowd presented the deal on its platform in February 2017, raising over $2.1 million in just 5 days. The over 29% IRR generated by the sale of the portfolio far exceeded the targeted 17% to 20% IRR projected by ArborCrowd at the time of the offering.
Lendio Reports Q2 Results: 90% Year-Over-Year Revenue Growth (Lendio) Rated: A
Lendio, the nation’s leading marketplace for small business loans, today announced record growth across all areas of its business, including 90 percent year-over-year quarterly revenue growth. To date, Lendio has helped facilitate more than $900 million in financing to over 45,000 small businesses across the U.S. and Canada through its marketplace of more than 75 small business lenders. The growth milestone comes after an 80 percent increase in loans funded through the Lendio platform in the last year.
From July 2017 to June 2018, Lendio facilitated nearly $400 million in loans to more than 22,000 small businesses. The average initial loan size among Lendio’s small business customers grew to nearly $35,000. The top five industries funded through Lendio’s marketplace include construction, retail, restaurants, health care and information media.
GM Maven CEO: Peer-To-Peer Auto Lending Will Be A Large Market (Bloomberg) Rated: A
Julia Steyn, Maven CEO, on their new peer-to-peer lending program for GM car owners, and the progress Maven is making in the shared economy.
Navigating through the P2P property maze (Peer2Peer Finance) Rated: A
Landbay investors can expect returns of around 3.54 per cent on its fixed-rate product, or 3.18 per cent with its tracker-rate option, by investing in loans secured by UK property.
The Peer-to-Peer Finance Association member launched its IFISA in February last year, meaning that Landbay customers can also benefit from tax-free earnings on their investments.
LandlordInvest’s investors have earned average annual returns of 11.3 per cent to date, secured by residential or commercial property, with the option of an IFISA wrapper
London Proptech Firm Goodlord Forms New Open Banking Partnership With TrueLayer (Crowdfund Insider) Rated: B
Goodlord, a UK-based proptech platform, has formed a new open banking partnership with TrueLayer. Founded in 2014, Goodlord reports that its cloud-based platform is trusted by hundreds of agencies across the UK. The company has created a one-stop-shop by providing access to a dynamic suite of specialized services, including insurance, e-signing, referencing, and e-payments.
Starling Bank takes on Monzo with daring debit card design (FinTech Futures) Rated: B
The new card has all customer details, including name, card number and expiry date, on the back – and it’s rolling them out this week.
The card is inspired by the blue-green tones of the plumage of the starling bird. It is also one of the initial group of 16 original “web colours” formulated in 1987 to display web pages, reflecting Starling’s digital heritage.
PPDai to boost technology investment (Shine) Rated: AAA
PPDai, China’s first online peer-to-peer lending platform listed in the US, said today it would increase its registered capital to 1 billion yuan (US$149 million) and expand its artificial intelligence applications to hedge risks and improve investor confidence amid concerns over P2P lending.
The Shanghai-based company, which has about 71 million users ,employs AI, Big Data and blockchain to fight against risk and fraud.
Alipay and WeBank competition heats up as China reins in leverage (Financial Times) Rated: AAA
Alipay and WeBank are set up perfectly to take advantage of new priorities from Chinese policymakers to increase the flow of capital to small companies and households, their approach is different as WeBank looks to use bank partnerships to make capital connections.
Alipay uses scale, data and technology capabilities to compete with banks for deposits and funds its borrowing through the ABS market.
Alipay and WeBank plan to list their finance arms soon which will continue to put pressure on the rivalry as well as the broader financial market in China.
Zennon Kapron on what’s next for Chinese fintech (China Economic Review) Rated: A
Analysing these questions is all part of the day job for Zennon Kapron, the head of fintech research and consulting firm Kapronasia. In this interview with China Economic Review, Kapron gives his take on some of the market’s recent developments, and explains why China’s fintech industry is such an exciting space to watch.
CER: How worried should we be about the recent panic surrounding China’s small P2P lending platforms?
ZK: The fact that P2P lending platforms are failing is not surprising. Many of these platforms had inadequate internal operational processes, poor lending practices, and in some cases, were just complete scams. What will be interesting to see is if retail investors will still want to put new money on these platforms. I get the impression at the moment that many investors are just trying to get their money out. Even if the P2P industry manages to right itself, it may find that all the investors are gone.
China’s P2P Online Lending Dominoes Continue to Fall (Ciaxin) Rated: A
Another domino in China’s peer-to-peer lending industry fell.
Beijing-based iqianbang.com was the latest online P2P lending platform to close down. The company announced a “benign exit” last Friday night, citing “deteriorating online lending environment and drying up liquidity.”
Investors in several P2P platforms, including iqianbang.com, gathered Monday at a local Beijing police station to report the loss of money to police.
Chinese P2P Lender’s Controller Disappears After Sponsoring Portugal (Yicai Global) Rated: A
Zheng Yansen, the controller of peer-to-peer lender Guangzhou Leader Internet Financial Information Service has disappeared, the firm announced yesterday.
It also acknowledged that ‘some of its projects are delayed’ and said it will set up a work group as soon as possible to inventory its assets and businesses, request borrowers to repay loans earlier than scheduled, and liquidate collateral as quickly as possible.
FinLeap Partners With Fabrick to Launch Financial Management Startup for Small Businesses (Crowdfund Insider) Rated: AAA
FinLeap, the fintech start-up platform behind Germany’s SolarisBank, announced on Monday it has teamed up with Italian open banking platform Fabrick to launch a new financial management startup specifically for small businesses. According to FinLeap, the startup, called Beesy, will simplify accounting, tax and banking services for micro-enterprises and freelancers.
As soon as Beesy is launched, FinLeap added it will provide more details about the services and how they work.
Rabobank’s novel approach to protecting customer data (American Banker) Rated: A
Take Dutch-based Rabobank, for example, which now converts customer data to the Latin names of flowers and animals in order to comply with the General Data Protection Regulation that sensitive client information be disguised.
At the heart of all these regulations is the mandate that companies must make sure no one can access customer data who shouldn’t, and that every effort is made to protect that data from breaches. Storing customer data in the clear — not encrypted, anonymized, or pseudonymized — is not acceptable, to regulators or anyone else.
MoneyGram And Visa Team To Deliver Real-Time Global P2P (PYMNTS) Rated: A
Launching in October in two key markets, Mexico and the Philippines, MoneyGram will expand its options in which receivers from those markets may receive and use funds instantly — via their bank-issued Visa-branded debit card or Visa-branded prepaid card — and senders may choose the option by which to send those funds. The partnership leverages the trust that consumers globally have in the MoneyGram and Visa brands, as well as the ability for receivers to access funds 24/7/365 without having to visit an agent location to pick up cash.
Property Connect enters technology agreement with Clearmatch to market new lending products (Small Caps) Rated: A
Realty services group Property Connect Holdings (ASX: PCH) has entered into a minimum five-year licence agreement to use a technology platform powered by marketplace treasury company Clearmatch, in the development and marketing of its own lending products designed to ease property market transactions.
The binding heads of agreement allows Property Connect to use the SocietyOne platform owned by Clearmatch to develop products focused on the emerging project development finance and residential mortgage sectors within the private peer-to-peer lending market.
P2P lending platform Monexo partners with Cube Wealth for new-clientele (Business Standard) Rated: B
Peer-to-Peer (P2P) lender, Monexo Fintech has partnered with Cube Wealth to provide clients with an alternative avenue for investments. The app-based wealth management firm’s user-base of 350,000 customers will have an option of placing a portion of their investments onto Monexo’s platform.
The P2P market space is only three years old and until last October operated without any regulatory oversight. While there are 3,000 P2P lenders in China with a total lending book of $500 million, the Reserve Bank of India (RBI) is said to have approved P2P licenses to around eight firms.
News Comments Today’s main news: LendingTree launches free credit monitoring. Paytm gets into P2P lending. EquityMultiple stops promoting Reg D 506c offerings. Trusted Quid customer info stolen in data breach. PPDai grows revenue as stock rises. Today’s main analysis: Why China Rapid Finance’s ownership structure is important. Today’s thought-provoking articles: Are Amazon, Costco, and Target inching into wealth management? Open banking […]
- Today’s main news: LendingTree launches free credit monitoring. Paytm gets into P2P lending. EquityMultiple stops promoting Reg D 506c offerings. Trusted Quid customer info stolen in data breach. PPDai grows revenue as stock rises.
- Today’s main analysis: Why China Rapid Finance’s ownership structure is important.
- Today’s thought-provoking articles: Are Amazon, Costco, and Target inching into wealth management? Open banking causes alt lenders to reassess partnerships. Digital banks raise the bar on customer experience.
- LendingTree launches free credit monitoring. AT: “In partnership with TransUnion. This is a great way to attract new customers, but they have to compete with Credit Karma and the dozens of other companies out there doing the same thing.”
- EquityMultiple stops promoting Reg D 506c. AT: “Opting instead for 506b rules.”
- Amazon, Costco, Target: wealth managers? AT: “This is all speculation, but it’s worth thinking about. If WalMart can get into online marketing, why not?”
- Savvy ways to invest $10K in 2018. AT: “Worth a read for those new to online lending.”
- SMB polls reveals value of tech investments.
- Startups tell investors to diversify.
- Buyers acquire taste for deposit-rich banks.
- New York surveys online lenders.
- Alt lenders reassess partnerships in the wake of open banking.
- Open banking shows mixed results.
- Trusted Quid had 66K customer details stolen with data breach.
- HouseSimple on home sales.
- LoanBit showcase.
- IFISA investments offer 5 to 10 percent.
- Is Ping An China’s most valuable insurer?
- PPDai sees shares rise as revenue grows.
- Why China Rapid Finance’s ownership structure is important. AT: A great read.”
- China toughens third-party payment supervision.
- Denmark: basisbank to implement Fico Blaze Advisor.
- Europe: How digital banks raise the bar for customer experience.
- India: Paytm wants a piece of P2P lending. AT: “They’ve already built an outstanding presence in payments, so why not slide into P2P lending? There is a lot of competition, but they can leverage their payments reputation to compete with Faircent and other top lenders moving ahead of the smaller players.”
- United States
- LendingTree Launches Free Credit Monitoring Service (LendingTree), Rated: AAA
- Real Estate Investment Platform EquityMultiple Gives up on Reg D 506c (Crowdfund Insider), Rated: AAA
- Amazon in wealth management? What about Costco or Target? (Financial Planning), Rated: AAA
- 5 Savvy Ways To Invest $ 10,000 In 2018 (Forbes), Rated: A
- Poll of SMBs Reveal Plans to Make Tech Investments Amid Strong Sales Growth (WWD), Rated: A
- Hundreds of Start-Ups Tell Investors: Diversify, or Keep Your Money (New York Times), Rated: A
- Buyers acquire taste for deposit-rich banks (American Banker), Rated: A
- NYDFS sends survey request to online lenders (National Law Review), Rated: B
- United Kingdom
- Open Banking prompts UK fintechs to reassess collaboration partners (P2P Finance News), Rated: AAA
- Early Returns From Open Banking Show a Mixed Picture (Lend Academy), Rated: A
- Payday lender Trusted Quid admits 66,000 customers details were stolen in data breach (The Sun), Rated: AAA
- Feature: Is London cooling? (Mortgage Strategy), Rated: A
- BUSINESS SHOWCASE : LOANBIT (Irish Tech News), Rated: A
- ISAs 2018: Innovative Finance Isa can offer rates from 5 to 10 per cent (Express), Rated: A
- Is Ping An China’s Most Valuable Insurer or a Tech-Investing Fad? (The Wall Street Journal), Rated: AAA
- Shares Rise as PPDai Reports Revenue Growth, Stock Buyback (Capital Watch), Rated: AAA
- Why China Rapid Finance Limited’s (NYSE:XRF) Ownership Structure Is Important (Simply Wall St News), Rated: AAA
- China toughens supervision on third party payment (xinhuane), Rated: B
- European Union
- Danish online lender basisbank to implement Fico Blaze Advisor (Finextra), Rated: B
- How digital banks are raising the bar for customer experience (Tearsheet), Rated: AAA
- Digital payments player paytm wants slice of P2P lending (The Economic Times), Rated:AAA
LendingTree Launches Free Credit Monitoring Service (LendingTree), Rated: AAA
LendingTree, the nation’s leading online loan marketplace, today announced the launch of a free credit monitoring service within the My LendingTree platform. In partnership with TransUnion, LendingTree monitors users’ credit profiles daily and sends alerts of any changes or potential suspicious activity within 30 minutes of the credit report being updated.
Real Estate Investment Platform EquityMultiple Gives up on Reg D 506c (Crowdfund Insider), Rated: AAA
No longer will EquityMultiple publicly promote its real estate offerings online and elsewhere. Previously, EquityMultiple has leveraged Reg D 506c – a new securities exemption created by the JOBS Act of 2012. This rule allowed issuers and platforms to promote offerings on the internet – via social media and elsewhere – in contrast to old Reg D (506b) that was barred from any advertising. And why on earth would EquityMultiple not want to promote unique and compelling investment opportunities? Because of the broken nature regarding the general solicitation rule.
Amazon in wealth management? What about Costco or Target? (Financial Planning), Rated: AAA
With Amazon inching closer to financial services, industry observers say its a worthy exercise to think about other potential retail competitors.
“People may roll their eyes in the land of wealth management and financial services, but it’s no longer a place for just banks. They don’t own it anymore,” said Doug Fritz, CEO and founder of F2 Strategy, a technology and marketing consulting firm to the wealth management industry based in the San Francisco Bay area.
Costco seems like the most obvious candidate to get into the wealth management space, said Fritz.
Incumbents such as Charles Schwab have already boxed in robos with products and are not being shy about advertising them, he adds.
5 Savvy Ways To Invest $ 10,000 In 2018 (Forbes), Rated: A
Online Real Estate Investing
In a recent poll of small- to medium-sized businesses, financial and technology firm Kabbage Inc. found high expectations for sales growth this year as well as plans to make investments aimed at automation.
Kabbage, which offers lines of credit of up to $250,000 and cites retail as its top vertical, said more than 67 percent of the brick-and-mortar retailers polled expect revenue growth of over 20 percent this year. More than 73 percent of the online retailer respondents expect the same. The survey was based on responses from 800 businesses.
Regarding automation technology, nearly 44 percent of physical store retailers have plans to make investments in this area compared with 60 percent of online retailers. With cyber security and similar fraud prevention technologies, about 44 percent of both online and physical store retailers have plans to make investments in these solutions.
Hundreds of Start-Ups Tell Investors: Diversify, or Keep Your Money (New York Times), Rated: A
The American venture capital industry, which invested $84 billion in more than 8,000 companies last year, has long faced little to no impetus to alter its demographics. Venture firms are usually small private companies made up of former tech executives or financial types, who are mostly male and white. And because venture firms operate with long-term horizons — their funds generally invest over a 10-year period — the industry’s pace of change is often glacial.
In 2016, 11 percent of venture capital firms’ investment partners were women, according to a survey by the National Venture Capital Association and Deloitte. The survey found no black investment partners at venture firms, while 2 percent of investment partners were Latino.
Buyers acquire taste for deposit-rich banks (American Banker), Rated: A
Total loans at banks with less than $10 billion in assets rose by nearly 17% between 2012 and 2017, surpassing the roughly 5% increase in deposits over that time, according to data from the Federal Deposit Insurance Corp.
NYDFS sends survey request to online lenders (National Law Review), Rated: B
The New York Department of Financial Services has sent a letter directed to businesses that the DFS “understands…may be involved in online lending in the State of New York” and that asks recipients to complete a “New York Marketplace Lending Survey” that they can access online.
The letter states that the DFS is conducting the survey to gather information for a public report that it is required to issue by July 1, 2018 and which must include information about online lenders operating in New York and their business practices, including lending practices, interest rates and costs charged, and consumer complaints and investigations about the industry.
Open Banking prompts UK fintechs to reassess collaboration partners (P2P Finance News), Rated: AAA
A report from accountancy firm EY, released on Thursday, found that 59 per cent of UK fintech firms see Open Banking as an opportunity to review their collaboration strategies.
The survey of 31 UK fintech firms also found that 74 per cent of respondents believe that new competitors such as tech firms will become increasingly important over time.
The new data rules, which mandate high street banks to share anonymised customer data with approved third parties, came into effect in January 2018. Peer-to-peer lenders such as Zopa and Lending Works have already announced their plans to capitalise on the new initiative.
94 per cent of fintech firms said they were focused on enhancing their current products and services and 81 per cent said they are planning to use Open Banking to build new services.
Early Returns From Open Banking Show a Mixed Picture (Lend Academy), Rated: A
Banks have not really stepped into the new world until recently as HSBC has stated they will be set to go live with a product by early May, RaboBank is creating a mobile ecosystem and RBS has explained they are working on solutions which includes a stand alone digital bank.
Digital banks Monzo and Starling Bank have already established themselves as early leaders in the market with their open APIs. Both have created financial marketplaces to allow for easy integration and access to different banking services.
Payday lender Trusted Quid admits 66,000 customers details were stolen in data breach (The Sun), Rated: AAA
Details of 66,000 customers including phone numbers, dates of birth, addresses, loan details, employment status and bank account information, were all taken from the website.
In a statement the company said: “There has been a theft of data from unauthorised access to the Trusted Quid website.”
“The incident relates to data directly entered by people applying for a loan only on the Trusted Quid website between 1 July 2016 and 17 February 2018.”
Trusted Quid say they have made three previous attempts to contact customers affected by the data breach.
Feature: Is London cooling? (Mortgage Strategy), Rated: A
Research from online estate agent HouseSimple in January showed only 387 properties for sale in zones 1–2 below the magic £300,000 level, rising to just 1,235 in zone 3. For homes valued at £300,001–£500,000, there were just 7,687 in zones 1-3 that were eligible for a stamp duty cut.
BUSINESS SHOWCASE : LOANBIT (Irish Tech News), Rated: A
LoanBit is a multi-currency platform that supports everything from fiat currencies to the latest cryptocurrencies. It allows you to send money in an encrypted format and secure it with state-of-the art security measures.
LoanBit offers an armor of a protection for the lenders. It safeguards the interests of the lenders in the community by covering up to 75% of the loan.
With LoanBit you can:
- Keep money in a multi-currency wallet,
- Trade on the integrated exchange,
- Invest money in cryptocurrencies, and
- Get a loan in the currency of your choice
ISAs 2018: Innovative Finance Isa can offer rates from 5 to 10 per cent (Express), Rated: A
The Innovative Finance Isa, or Ifisa, was announced by the Government in April 2016, giving ordinary savers the opportunity to invest in growing British businesses free of tax through the growing peer-to-peer (P2P) lending market, sometimes called crowdlending.
Is Ping An China’s Most Valuable Insurer or a Tech-Investing Fad? (The Wall Street Journal), Rated: AAA
The $100 billion question for the world’s second-largest insurer: is it an insurance firm or is it a technology firm?
Shares of China’s Ping An Insurance—the biggest insurer by market value after Warren Buffett’s Berkshire Hathaway—have more than doubled in the past year, far outpacing peers. The increase in its market capitalization—of more than $100 billion—is partly due to the fast growth of its life- and health-insurance business. The value of new business last year grew 33% from 2016.
Shares Rise as PPDai Reports Revenue Growth, Stock Buyback (Capital Watch), Rated: AAA
PPDai Group Inc., an online peer-to-peer lending platform in China, reported today that its operating revenues for the fourth quarter increased more than 85 percent compared with a year earlier.
The Shanghai-based company, which completed its initial public offering in November, said during the quarter, it had a net loss attributable to ordinary shareholders of $200.4 million, or 89 cents per American depositary share. That was in contrast to income of $2.8 million a year earlier. Revenue for the three months ended Dec. 31 was $140.2 million, up from $75.7 million in the year-earlier period.
Why China Rapid Finance Limited’s (NYSE:XRF) Ownership Structure Is Important (Simply Wall St News), Rated: AAA
I am going to take a deep dive into China Rapid Finance Limited’s (NYSE:XRF) most recent ownership structure, not a frequent subject of discussion among individual investors. When it comes to ownership structure of a company, the impact has been observed in both the long-and short-term performance of shares. The same amount of capital coming from an activist institution and a passive mutual fund has different implications on corporate governance, which is a decisive factor for a long-term investor. It also impacts the trading environment of company shares, which is more of a concern for short-term investors. Therefore, I will take a look at XRF’s shareholders in more detail.
In XRF’s case, institutional ownership stands at 18.79%, significant enough to cause considerable price moves in the case of large institutional transactions, especially when there is a low level of public shares available on the market to trade.
Another important group of shareholders are company insiders. Insider ownership has to do more with how the company is managed and less to do with the direct impact of the magnitude of shares trading on the market.
General Public Ownership
The general public holds a substantial 42.76% stake in XRF, making it a highly popular stock among retail investors.
Private Equity Ownership
Private equity firms hold a 16.12% stake in XRF.
Private Company Ownership
Potential investors in XRF should also look at another important group of investors: private companies, with a stake of 5.44%, who are primarily invested because of strategic and capital gain interests.
China toughens supervision on third party payment (xinhuane), Rated: B
Agricultural Bank of China announced in a recent notice that it would cut off the payment channel for Internet finance businesses such as peer-to-peer lending, the Xinhua-run Economic Information Daily reported.
The move followed a series of penalties levied at banks and online payment companies, which analysts said were aimed at curbing risks arising from direct clearance agreements between them.
Danish online lender basisbank to implement Fico Blaze Advisor (Finextra), Rated: B
With FICO Blaze Advisor decision rules management system, Basisbank risk analysts will be able to quickly make changes to credit strategies for unsecured consumer loans and point-of-sale financing in order to increase profitability and reduce the risk of loans going unpaid. Basisbank receives more than 75 percent of its credit applications from mobile devices.
How digital banks are raising the bar for customer experience (Tearsheet), Rated: AAA
Challenger bank N26 raised $160 million in Series C funding this week to fuel its expansion to the U.S., and other markets, later this year. Revolut, another U.K. challenger, has been planning a U.S. launch this year too and Monzo is rumored to follow.
Digital-only challenger banks have changed customer expectations, including customer service and how customers want to use financial products. Big banks are taking notice, with companies developing sub-brands to hook younger, digital-savvy customers or others — the most recent of which is rumored to be the Royal Bank of Scotland.
For Monzo, which just crossed 500,000 current account holders, the absence of physical branches doesn’t mean a lack of interaction with customers. Monzo’s approach is to release early versions of products to a group of customers and get customer feedback from within the app and through an online forum. It’s an approach that gives customers a sense of ownership and excitement about the brand. For Monzo’s marketplace beta, it sought out feedback from 3,000 customers.
Digital payments player paytm wants slice of P2P lending (The Economic Times), Rated:AAA
Paytm, the country’s largest digital payments company, is trying to enter the lending space and is seeking a licence from RBI to become a peer-to-peer lending platform.
According to documents sourced by ET from the Ministry of Corporate Affairs, the company moved a board resolution on February 7 saying it intends to “carry on the business of non-banking financial company — peer-to-peer”.
News Comments Today’s main news: Walmart getting closer to a deal with Afffirm. AutoFi raises $10M. Zopa reports diminishing losses, rising revenues for 2016. Landbay closes 2.4M GBP round on Seedrs. USAmeriBank goes live on Finastra. Today’s main analysis: After shallow sell-off, corporate credit spreads stabilize. Today’s thought-provoking articles: A call for more considered critiques of P2P lending. What’s behind […]
- Today’s main news: Walmart getting closer to a deal with Afffirm. AutoFi raises $10M. Zopa reports diminishing losses, rising revenues for 2016. Landbay closes 2.4M GBP round on Seedrs. USAmeriBank goes live on Finastra.
- Today’s main analysis: After shallow sell-off, corporate credit spreads stabilize.
- Today’s thought-provoking articles: A call for more considered critiques of P2P lending. What’s behind the fintech boom in China? Klarna co-founder is thinking about giving money away. Reserve Bank of India looking to tweak regulation of non-bank financial companies.
- Walmart, Affirm getting closer to closing the deal. AT: “The news broke yesterday that Walmart is discussing the possibility of using Affirm to offer financing on point-of-sale purchases. If this happens, and it looks like it will, the floodgates will open to POS financing.”
- You can now buy $400 pants with a subprime loan. AT: “Not friendly toward alt lenders, but an interesting read nonetheless, and the podcast even more so. This commentator is critical of Affirm and the pending Walmart-Affirm deal.”
- A Walmart-Affirm partnership will strain Synchrony. AT: “Companies change. Practices change. If Synchrony dies, will it really be all that bad? Not for Walmart, and not for Affirm.”
- After shallow sell-off, corporate credit spreads stabilize.
- AutoFi raises $10M to make it easier to get a car loan. AT: And it will likely achieve its purpose in delivering faster loans while facilitating more auto lending.”
- TD Ameritrade tackles security in Facebook Messenger chatbot.
- The future of Simple. AT: “It’s refreshing to see a company admit it has strayed from its original path and is now going to repent.”
- SuperMoney’s auto loan offer engine. AT: “Interesting that interest rate is the least negotiated factor among auto buyers when purchasing a car when it is where they spend the most on their purchase. I see the auto lending sector heating up in the next couple of years thanks to services like SuperMoney.”
- Lending as a Service (LaaS) and why it matters. AT: “LaaS matters because it allows banks to act like technology companies without being technology companies.”
- New report on fintech.
- Douugh rises to challenge with AI-powered banking.
- Douugh seeks to rebundle financial services.
- Filippo Loreti attracts alternative investments for wristwatches.
- Smart solutions for smart cities. AT: “This is the first time I’ve seen the connection made between the Internet of Things and marketplace lending. While JD Supra doesn’t spell it out, there are all sorts of solutions that can facilitate more a connected financial services sector with everyday living. They include apps for connected cars that allow you to apply for a loan from your bank or preferred lender at the push of a button. And you can just as well have one in your home, too–on the wall, on your TV, by voice command.”
- Dos and don’ts for small business crowdfunding.
- Why RealtyShares was the right choice for Acquire Real Estate.
- Wealth management vs. financial advice.
- How to win an argument. AT: “I’m a believer in indirect marketing, but this is really indirect. Show this to your sales teams.”
- Zopa reports diminishing loss, rising revenues for 2016.
- A call for more considered critiques of P2P lending. AT: “I have noticed that a lot of the criticisms of the P2P lending sector seem to be veiled attempts at protecting legacy institutions. Let the marketplace decide who survives.”
- Landbay closes 2.4M crowdfunding round on Seedrs.
- IFAs still most influential source of financial advice.
- Should more banks form partnerships with alternative lenders? AT: “Whether we think they should or shouldn’t, I believe they will.”
- Debunking P2P lending myths.
- P2P lenders not wooing UK customers.
- Reserve Bank of India to harmonize regulations of non-bank financial companies (NBFC).
- Updating regulations on NBFCs.
- United States
- Walmart reportedly closes in on pilot deal to offer Affirm loans (Retail Dive), Rated: AAA
- You can now buy $400 pants with a subprime loan (The Outline), Rated: A
- Wal-Mart Stores To Exacerbate Synchrony Financial Woes With Affirm Deal (Baystreet), Rated: A
- After shallow sell-off, corporate credit spreads stabilize (Morningstar), Rated: AAA
- AutoFi Raises $ 10 Million Series A To Make It Easier To Get A Car Loan (Forbes), Rated: AAA
- How TD Ameritrade tackles security in Facebook Messenger chatbot (Financial-Planning), Rated: A
- The Future of Simple (Simple.com), Rated: A
- SuperMoney’s Auto Loan Offer Engine Will Change the Way You Buy A Car (Supermoney), Rated: A
- Lending as a service (LaaS) and why it matters (CIO), Rated: A
- New Report on Fintech from the World Economic Forum (Lend Academy), Rated: A
- Douugh Rises to Challenge with AI-Powered Banking (Paybefore), Rated: A
- Rebundling financial services is aspiration of startup Douugh (American Banker), Rated: A
- Ripple- Just As Good If Not Better (Investing.com), Rated: A
- Smart Solutions for Smart Cities (JD Supra), Rated: B
- SCORE: Dos and don’ts for crowdfunding small businesses (PostBulletin), Rated: B
- “When We Decided to Sell the Company, it Became Apparent that RealtyShares Was the Right Choice” (Crowdfund Insider), Rated: B
- Wealth Management vs. Financial Advice: They’re Not the Same (Kiplinger), Rated: B
- How to Win an Argument (Mental Floss), Rated: B
- United Kingdom
- Zopa Reports Diminishing Loss as Revenues Rise for 2016 (Crowdfund Insider), Rated: AAA
- A call for more considered critiques of P2P lending (AltFi), Rated: AAA
- Landbay Closes £2.4M Crowdfunding Round on Seedrs (Finsmes), Rated: AAA
- IFAs still most influential source of financial advice (P2P Finance News), Rated: A
- Should more banks form partnerships with alternative lenders? (Bridging and Commercial), Rated: A
- Debunking the peer-to-peer lending myths (City A.M.), Rated: A
- P2P Lending Sites Not Quite Wooing UK Customers (PYMNTS), Rated: A
- Fintech in China: What’s Behind the Boom? (Brink News), Rated: AAA
- A global block chain summit was spot inspected, caused shock on ICO market (Xing Ping She), Rated: A
- European Union
- Klarna co-founder seeks to spur European tech giving (Financial Times), Rated: AAA
- Rabobank constructs physical model to understand IT architecture (Finextra), Rated: A
- USAmeriBank live on Finastra hosted payments hub (Finextra), Rated: AAA
- AI Is the New UI – Exclusive Interview With Jake Tyler, CEO of Finn.AI (Let’s Talk Payments), Rated: A
- RBI to harmonise NBFC regulations (India Times), Rated: AAA
- Guernsey consultation to update regs governing ‘non-regulated’ financial businesses (International Investment), Rated: A
- The future of banking in Southeast Asia is in Cryptocurrency (Hero Email), Rated: B
Walmart reportedly closes in on pilot deal to offer Affirm loans (Retail Dive), Rated: AAA
Walmart reportedly is closing in on an agreement with loan services startup Affirm for a pilot program under which Affirm would offer the retailer’s customers installment loans for purchases, sources familiar with the matter told The Wall Street Journal.The pilot could start as early as this fall.
Why are retailers so enamored with Affirm? Giving customers the option to take out an installment loan to finance a purchase gives customers more choices, making it more likely that they actually will make the purchase. Millenials and other younger demographioc consumers are often loathe to carry mountains of personal debt that way previous generations have.
However, it also has to do with the inflexible and sometimes excessive terms of store credit cards, which generally charge higher interest rates than the lowest portion of Affirm’s rate range. Still interest revenue and late fees from store cred cards contribute a significant amount of money to retailers’ bottom lines, making it difficult for them to commit to giving their customers more financing choices.
Overall though, retailers, banks and credit card companies are all starting to understand that at a time of massive change in how and where people shop, they need to make it easier for shoppers to close the deal. Mastercard may recognize this as well as Walmart does. The card network aligned with Verifone late last year to begin offering instant installment financing at the point of sale.
You can now buy 0 pants with a subprime loan (The Outline), Rated: A
Affirm may be a relatively new company, but the service it offers isn’t particularly innovative: It’s taking the concept of layaway, a type of no-interest payment plan that became popular during the Great Depression that lets you pay for things in fixed installments and take them home once you’ve paid for it in full, and twisting it for millennials. Unlike layaway, Affirm delivers your purchases instantly — but the cost of instant gratification is interest rates as high as 30 percent. The service is basically a cross between credit cards and layaway, combining the worst aspects of both.
Once your Affirm loan is approved, you can choose to pay it off in 3, 6, or 12 months, and interest rates range from 10 to 30 percent. The average customer takes out a $750 loan with a 21-percent interest rate and pays it back in nine months. Compared to credit cards, which have an average APR of 17 percent, and personal loans that typically have interest rates ranging from 5 to 36 percent, Affirm isn’t a particularly good deal.