Thursday June 20 2019, Weekly News Digest

ASIC borrowers

News Comments Today’s main news: LendingClub expands borrower program. Funding Circle forced to narrow range of valuation. Yirendai revenues come from haircut loans. Chinese P2P lenders explore southeast Asia. Borrowell passes 1M members, raises $20M. Today’s main analysis: 5 ASIC findings on marketplace lending. Today’s thought-provoking articles: US Core, inflation ease. Fintech lending algorithms discriminate […]

The post Thursday June 20 2019, Weekly News Digest appeared first on Lending Times.

ASIC borrowers

News Comments

United States

United Kingdom

China

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News Summary

United States

LendingClub Expands Program to Help Borrowers Actually Pay Off Debt (Lend Academy), Rated: AAA

LendingClub shared a few stats on borrowers who choose this method:

  • Save an average of nearly $900 over the course of their loan
  • Cut their credit card interest rate nearly in half
  • Increase their credit score in just three months

The product has been tested for over a year and LendingClub is working with a partner network of over 1,700 credit card, bank and loan companies to make the process seamless. What’s interesting is borrowers can add up to 12 creditors per loan which is an important feature since borrowers often hold balances across many cards.

Turning Lending Club’s Worst Loans into Investment Gold (Towards Data Science), Rated: A

This is a writeup of a machine learning project I completed. In this post I hope to:

  • Describe my algorithm for predicting loan defaults.
  • Use the algorithm to construct a portfolio of clean loans

Inflation Miss (PeerIQ), Rated: AAA

US Core CPI rose by 2% YoY in May, just at the Fed’s target rate but below economists’ expectations. Consistently low inflation is boosting calls for a rate cut next week. The market is pricing in a 24% probability of a rate cut next week and a 76% probability of a rate cut in September.

Source: Bloomberg, PeerIQ

Fintech algorithms discriminate 40% less than traditional lenders (Quartz), Rated: AAA

Algorithmic fintech lending is less discriminatory against minorities than traditional loan officers, according to a recent study of US mortgages. The findings signal hope that technology could provide financing that’s more fair, but the research also underscores how widespread discrimination remains.

The US housing market has long been prejudiced against minorities. When Latino and Africa-American borrowers are looking to buy a home, they usually end up paying 7.9 basis points (0.079 percentage points) more than whites to take out the mortgage, and 3.6 basis points more when they refinance the debt, according to a National Bureau of Economic Researchworking paper published this month.

Buttigieg worries tech may add racial bias to credit decisions (American Banker), Rated: A

Pete Buttigieg said the way credit scoring is done in the U.S. is fraught with inequality and he’s worried the process may get worse with systems based on artificial intelligence.

Commercial Real Estate Crowdfunding Eyes ’18-Hour Cities’ for Small Investors (The Street), Rated: A

When Clear Point Gardens, a 604-unit apartment complex in Columbus, Ohio, recently changed hands, it produced a nearly 43% gain in 16 months, an amazing windfall for investors in the deal.

All 68 of them.

The sale of Clear Point, financed with help from investors on CrowdStreet’s online platform, is the latest example of how online syndication is revolutionizing the way deals are financed in the $6 trillion commercial real estate market.

HSBC launches digital mortgage platform with help from Roostify (HousingWire), Rated: A

One of the world’s largest banks is about to join the digital mortgage revolution, as HSBC Bank USA, the U.S. arm of HSBC Group, announced that it is partnering with Roostify to launch a digital mortgage platform.

Mirador’s Trevor Dryer: ‘The world doesn’t need another high price lender’ (Tearsheet), Rated: A

Trevor started Mirador to fill this void of bank-originated small business lending. We talk about why he started Mirador with a lending as a service model and what painpoints he was addressing.

Dave is launching a checking account that helps users build their credit score (Business Insider), Rated: A

The Los Angeles-based company, backed by investors including Mark Cuban, the DJ Diplo, and hedge fund Mark 2 Capital, said on Tuesday it’s rolling out a new checking account product that reports all rent payments to credit agencies. The new feature, added to Dave’s original app, helps customers to build their credit. Dave plans to begin reporting utility payments later this summer.

CoreLogic Launches Marketrac Platinum (CoreLogic), Rated: A

With Marketrac Platinum, lenders and title companies can utilize the interactive platform to identify top performing real estate agents and brokerage firms to prioritize professional relationships based on market trends.

Zirtue Revolutionizes Peer-to-Peer Lending (IT Business Net), Rated: A

Sprout Mortgage Launches ACORN Automated Underwriting System (Yahoo! Finance), Rated: A

Sprout Mortgage, the innovative force in Non-QM lending, today announced the launch of its ACORN automated underwriting system (AUS) as part of an ongoing effort to deliver value-added services to its third-party origination clients.

Finicity Integrates with LendingQB to Optimize Mortgage Origination Process (PR Web), Rated: B

Finicity announced today an integration with LendingQB. LendingQB’s platform now uses Finicity’s digital Verification of Assets (VoA) solution to allow lenders to free up resources, increase processing speed and reduce mortgage fraud while providing borrowers with a more efficient and positive experience.

Cardholders Seek to Capital-ize on Madden (The National Law Review), Rated: A

Last week, three Capital One cardholders filed a putative class action in the Eastern District of New York, Cohen v. Capital One Funding, LLC,1 alleging that the rates of interest they paid to a securitization trust unlawfully exceed the sixteen percent threshold in New York’s usury statutes.  The Plaintiffs seek to recoup the allegedly excessive interest payments and an injunction to cap the interest rates going forward.

Fundbox Tapped By Top B2B E-Commerce Software Provider OroCommerce to Power Net Terms (Fundbox Email), Rated: A

According to a 2019 research study by

Cross River poaches execs from student refinancing firm Laurel Road (American Banker), Rated: A

Cross River Bank, a Teaneck, N.J.-based bank that focuses most of its energy on supporting fintechs, is hiring several people from the student loan refinancing company Laurel Road to its capital markets team.

Cross River’s fintech partners include Affirm, Circle, Best Egg, Coinbase, Rocket Loans, Stripe, Upstart and Transferwise.

Optimizely Closes $ US105M Financing Round (Which-50), Rated: A

Optimisation platform Optimizely has closed US$105 million in financing, including US$50 million in Series D funding. The funding, led by Goldman Sachs Private Capital Investing, also included Accenture Ventures.

Austin Niemiec Named New Executive Vice President of Quicken Loans Mortgage Services (Yahoo! Finance), Rated: B

Quicken Loans Mortgage Services (QLMS), the second largest mortgage lender serving the needs of brokers, regional banks and credit unions, today announced that Austin Niemiec has been named Executive Vice President.

Self Lender Awarded Inaugural Inclusive Fintech 50 (PR Newswire), Rated: B

Self Lender is pleased to announce its inclusion in the inaugural list of winners of the Inclusive Fintech 50. The Inclusive Fintech 50 is a competition launched in February to help early-stage fintech companies attract capital and resources to benefit the world’s 3 billion financially underserved people. The competition was organized by MetLife Foundation and Visa Inc., with global nonprofit Accion and World Bank Group member IFC.

United Kingdom

No sign yet of breaking out of circle (The Times), Rated: AAA

The early days of a company’s life on the stock market tends to set the tone for what follows. The grief around Funding Circle’s listing began even earlier and has continued to plague it.

Days before trading in shares of the specialist online lender began at the end of September, Funding Circle and its bankers were gunning for a valuation of up to £1.75 billion, only to be forced to narrow the expected range shortly before it came to market, and then to price the shares at the lower level of 440p apiece.

Source: Refinitiv

Three Biggest Overperformers And One Underperformer In Peer-To-Peer Lending (4th Way Email), Rated: AAA

Landbay

  • Over £300 million lent.
  • Maximum loan size to property valuation (LTV) 80% – better than all the major high-street banks.
  • Average LTV: 72% – highly suitable for these kinds of mortgages.
  • Average rent: 190% of the monthly mortgage payment.
  • Over 90% of mortgages are to experienced and professional landlords.
  • Reserve fund: 0.6% of outstanding mortgages – modest but useful.
  • Type of lending: residential BTL.
  • Typical risk of this type of bank lending: very low.
  • P2P bad debts: none.
  • Interest rate: 3.54% after expected bad debts.

Proplend

  • £65 million lent.
  • Maximum loan size to property valuation (LTV) 75% and investors can choose to limit to 50% – lower than all high-street banks.
  • Average LTV  60% – highly suitable for these kinds of mortgages and loans.
  • Minimum rent on rental properties usually 110% of the monthly mortgage payment.
  • Type of lending: residential and commercial rented properties up to five years; some development lending; a mix of senior and junior debt (junior means other lenders get repaid first if the borrower’s property has to be forcibly sold to repay the loans).
  • Typical risk of this type of bank lending: low to moderate for shorter-term rental properties; moderate to high for developments and junior debt.
  • P2P bad debts: none.
  • Interest rate: 7.32% to 9.43% after expected bad debts (7.32%-12.13% before bad debts).

CrowdProperty

  • £35 million lent.
  • Maximum loan size to property valuation (LTV) 70% and investors can choose to limit to 50% – lower than all high-street banks.
  • Average LTV  61% (against starting value of property) – very low for these kinds of loans.
  • Type of lending: property development lending.
  • Typical risk of this type of bank lending: moderate to high.
  • P2P bad debts: none.
  • Interest rate: 8% after expected bad debts (7.32%-12.13% before bad debts).

Rebuildingsociety – the Underperformer

  • £15 million lent.
  • Type of lending: unsecured small business lending to sub-prime.
  • Typical risk of this type of bank lending: moderate to high.
  • P2P bad debts: 17% of total lent in pounds
  • Interest rates: estimate an average 5% after heavy losses.

British Business Bank adds £60m firepower to non-bank lender (AltFi), Rated: A

Simply, a non-bank lender, focused on SME asset financing has scored a a third financing tranche of £60m from the British Business Bank.

One fifth of UK investors upping exposure to debt investments (Investment Week), Rated: A

One-fifth of UK investors are increasing their exposure to debt amid low interest rates and Brexit uncertainty, according to research from FJP Investment, which found this number climbs to 34% when 18-to-35 year-olds are considered in isolation.

However, the independent survey – which comprises 950 investors – discovered 44% of participants are more focused on short-term debt investments over this financial year due to both political and economic uncertainty; this figure rose to 68% among under 35s.

OakNorth completes loan to Oncore IT for the acquisition of Fuse Technologies (Fintech Finance), Rated: A

OakNorth – the bank for entrepreneurs, by entrepreneurs – has provided a loan to Oncore IT, a managed service and cloud platform provider.

The finance has been used for the acquisition of Fuse Technologies, a London based provider of unified communications tools.

Brexit and drive for growth sees IT fintech salaries surge (AltFi), Rated: A

London-based java developers lead the pack, commanding starting salaries of up to £60,000, followed by software developers in the capital on up to £55,000.

Intense competition between UK-based fintechs – lead by Revolut, TransferWise, OakNorth and Funding Circle – and high street banks attempting to upgrade their services has led to bidding wars in order to gain top level IT professionals, said the report called The UK Fintech Revolution.

Lloyds first to launch open banking app for credit cards and savings (Fintech Futures), Rated: A

Customers of Lloyds Bank, Halifax and Bank of Scotland are the first to see their savings accounts and credit cards in one place, thanks to open banking technology, reports Jane Connolly.

J.P. Morgan working on a secretive digital banking project based out of London (TechCrunch), Rated: A

A number of incumbent banks are known to be developing new digital-first products in a bid to keep the new wave of challenger banks at bay and now it appears that the latest to make that move is J.P. Morgan.

According to sources, the investment bank has begun recruiting for a secretive skunkworks project within London’s booming fintech industry. Very few details are known about what exactly J.P. Morgan plans to build, although TechCrunch understands the bank is busy hiring high level developers with full-stack and cloud-based dev skills for the new project, along with other personnel.

Following Facebook’s Libra launch, UK regulator hints at greater Big Tech scrutiny (AltFi), Rated: A

The FCA says technology is dramatically changing the markets it regulates and blurring regulatory boundaries in a new report into its activities.

China

Yirendai Revenues Come From Suspect Haircut Loans (Seeking Alpha), Rated: AAA

Over 60% of YRD’s FY 2018 revenues stem from “haircut loans” (P2P service fees charged to borrowers) that are prohibited by Chinese regulation. Recent developments in the P2P lending sector with regards to questionable lending practices, unethical collections, and usury are not being disclosed in YRD’s SEC filings, leaving U.S., Canadian, and international investors completely in the dark.

The Chinese P2P Lending Market

Unlike in developed countries, there are no administrative bodies (such as the U.S. Securities Exchange Commission) which regulate peer to peer lending exchanges in China. Instead, such services are regulated by self-organized internet associations and retail banks. The lack of meaningful oversight has caused the Chinese P2P lending market to bubble into $178.9 Billion in FY2018, almost 22 times the size of the P2P lending market in the United States and 447 times that of Japan’s.

Over 850+ fraudulent/ponzi lending platforms were exposed in FY 2018 alone.

Source: iiMedia Research

But the bad numbers don’t end here:

– The total loan volume amounted to 245.9 billion in Q12019, down -55.5% Y/Y.

– 85.7 in new loans were lent in March 2019, down -53.5% Y/Y.

– Principal balance of all loans: 8,029 CNY billion, down -3.6% Y/Y.

– sum of P2P lenders and borrowers, up 21%.

Chinese P2P lending platforms look to Southeast Asia amid industry purge back home (Technode), Rated: AAA

A slew of Chinese fintech and peer-to-peer (P2P) lending platforms are looking to more lenient markets in Southeast Asia (SEA), following a prolonged industry crackdown in China that has left the sector reeling.

Over the past year, China’s regulatory clampdown on risky financial practices has wiped out more than half of the country’s P2P lending platforms. As of May, just 900 survived, down from almost 1,900 recorded a year ago.

In early June, Indian daily newspaper the Economic Times reported that Chinese fintech companies, including WeShare, 9F Group, and CashBUS, are exploring investment opportunities in the country’s burgeoning online lending sector, particularly in the P2P lending space.

XW Bank Welcomed by IMF as One of 6 Outstanding FinTech Companies From China (Yahoo! Finance), Rated: A

The International Monetary Fund (IMF) welcomed 6 outstanding FinTech companies from China including Ant Financial, WeBank and XW Bank.

European Union

Snask helps Klarna to communicate its ‘smooth’ banking offer with off-the-wall film and photography (Creative Boom), Rated: A

When Stockholm studio Snask was approached by Klarna, one of Europe’s biggest banks, to help communicate how its revolutionary payment solutions make life easier for its customers, it set out to create seven “never-seen-before” worlds.

LHV Bank Integrates Estateguru Investments in Online Banking Dashboard (P2P-Banking), Rated: A

You might wonder why that is relevant as most readers are unlikely to be LHV Bank customers. LHV Bank is a bank in Estonia.

I think it is highly interesting, as it is – to my knowledge – the first time a bank has integrated p2p lending investments in its customer interface. So the LHV bank customers, not only see their accounts and stock depots, but also their Estateguru investments conveniently listed in their online bank dashboard. Much has been talked about what role could banks have in p2p lending (mere transaction banks? providing credit lines?) and also there is a lot of speculation if PSD2 (open banking) will help fintechs to seize the access to the customer from banks because they could control the user interface in the future. But this is actually a first step a bank takes in the opposite direction. By aggregating “non-bank” information inside the dashboard, they aim to make the banking interface more useful for the customers.

International

How Klarna is Helping the World Shop Like a Queen (Power Retail), Rated: AAA

Klarna is the latest Buy Now Pay Later (BNPL) app to sweep through the world. Originating in Sweden, the BNPL platform allows users to purchase goods and schedule repayments in timeslots. At this point in time, Klarna is the first and only BNPL platform that’s available in the U.S. It’s also available in the UK, Denmark, Norway, Belgium and many other European countries.

Australia

Five key ASIC findings on marketplace lending (Cuffelinks), Rated: AAA

In April 2019, the Australian Securities and Investments Commission (ASIC) released its third report on marketplace lending, the Survey of marketplace lending providers: 2017–18The report paints a clear picture of a once-nascent industry enjoying growth with new borrowing increasing by nearly 45% in the 2017-18 financial year. The report notes that this growth is moderating compared to the near doubling in funds borrowed the previous year (from $156 million to $300 million). By contrast, the Australian Bureau of Statistics (ABS) reports that overall personal lending has declined by an astonishing 24% in the 12 months to March 2019.

Source: Cuffelinks

The ASIC report found that the average interest rate charged for marketplace loans entered into during the 2017–18 financial year was 11.5%, up from 10.5% in the 2016–17 financial year.

Source: Cuffelinks
India

All you need to know about P2P lending and Commodities (India Times), Rated: AAA

Vinay Mathews, Founder and COO, Faircent and Sanjay Gakhar, Vice President, MCX talks about the benefits of investing via the P2P platform and Commodities, ET Wealth investment Workshop in Delhi Listen in!

Watch the video here.

Asia

Indonesian firms turn to P2P lenders for funds (Asia-First), Rated: AAA

Small companies in Asia-Pacific are tapping new funding sources, according to the Economist Intelligence Unit (EIU) study commissioned by Mastercard, with peer-to-peer (P2P) lending platforms in Indonesia reportedly posting USD1.4bn worth of transactions in 2018, an increase from USD20m in 2016.

Canada

Borrowell passes one million members, raises $ 20 million in new capital (Zone Startups), Rated: AAA

RFI alumni company Borrowell announced that it had reached significantly more than a million users, making it Canada’s largest consumer fintech company by that measure.

In addition to this membership milestone, Borrowell also confirmed that it has received $20 million in Series B funding.

AltFi Toronto Summit 2019 (AltFi), Rated: B

WED, 9 OCTOBER 2019, 08:30 – 17:30 EDT

Blind Bird tickets are now on sale at a 50% discount ahead of the Summit’s agenda being announced later this Summer.

Authors:

George Popescu
Allen Taylor

The post Thursday June 20 2019, Weekly News Digest appeared first on Lending Times.

Friday March 2 2018, Daily News Digest

Seed

News Comments Today’s main news: How Funding Circle wants to fix the financial system. VPC Specialty Lending, Ranger Direct see dividends move up. Klarna triples net profit, mainly in Nordic countries. Today’s main analysis: International P2P lending volumes. Today’s thought-provoking articles: Can Seed solve banks’ digital onboarding issues? How banking institutions can decentralize (The best read of the day). Institutional […]

Seed

News Comments

United States

United Kingdom

European Union

International

Asia

News Summary

United States

This neobank believes it can solve banks’ digital onboarding problem (American Banker), Rated: AAA

Since 2014 the neobank Seed has been reimagining one of the sleepier areas of banking: deposit accounts for small businesses.

Rather than walk into a branch — Seed, of course, has none — yoga instructors, food truck owners and other would-be customers can apply for accounts in less than five minutes on the startup’s web or mobile app. If approved, they receive a business debit card in the mail.

Now Seed, led by veterans of the fintech Simple, is selling banks software to help them solve one of their most pressing problems: finding a way to open accounts online as branch transactions continue to decline.

Source: American Banker

Lendio Franchise Announced in Clemson Region (Lendio), Rated: A

Lendio, the marketplace for small business loans, today announced the opening of a new Lendio franchise in the Clemson, South Carolina Region. Through the Lendio franchise program, Andy Ronemus will help local businesses in the community apply for loans, review their options and secure funding, easing the financial hurdles for small business owners.

In A Time of Need, A Woman Rises To Disrupt Fintech In Puerto Rico (Forbes), Rated: A

One notable leader in this endeavor is 

Fintech Startup Magilla Wants to Be the Match.com of Loans (Big Law Business), Rated: A

Since its launch in January 2016, Sacramento-based startup Magilla Loans says it’s originated more than $5 billion in loans and is changing the way lenders connect with borrowers. The platform can shrink into a few days what can often be a weeks- or months-long process of loan applications, data submissions and waiting just to get a loan term sheet.

Crowdlending helped Shorewood business woman’s dreams come true (tmj4), Rated: A

One Shorewood businesswoman did this all on a website called Kiva.

Shelia Long’s business is a workspace that helps ladies who work from home come together to get inspired.

“It was so great as the loans were coming in you can see like Switzerland, Boston, Carlsbad, Texas,” said Shelia Long.

One-hundred-thirty-seven people in total used PayPal to help her get to a goal of raising $8,000 at zero-percent interest.

Validus Specialty Launches Package Policy for Fintech Companies (Crowdfund Insider), Rated: A

Validus Specialty Underwriting Services, Inc. (Validus Specialty) announced on Thursday a comprehensive package policy specifically designed for private U.S. fintech companies. According to the company, the solution is designed to address Fintech’s complex risk management needs, which are traditionally underserved by incompatible and inadequate policy forms.

What’s next for marketplace ABS? Revolvers, ETFs & IOs (Asset Securitization Report), Rated: A

Last year, marketplace lenders learned that maintaining diverse sources of funding is just as important as managing the credit risk in their loans.

LendingClub, Marlette Funding and others developed their own securitization platforms, rather than relying on whole-loan sales to large investors. They also invited some of these investors to contribute seasoned loans to collateral pools for these in-house deals.

INSTITUTIONAL INVESTORS WARY OF PASSIVITY (All About Alpha), Rated: AAA

Geopolitical events are the most worrisome prospect on the minds of the decision makers at institutions looking ahead to 2018. The percentage of respondents who believe such events will have a negative impact this year is at 74%. The second most worrisome? Asset bubbles (65%).

More than three fifths (63%) of those surveyed said that the growth of passive investing has increased systemic valuation risk: 59% believe that flows into passive strategies artificially suppress volatility.

In 2015, Natixis found that 64% of institutions said they were upping their investments with active managers. In 2016, that number rose to 67%. In the latest survey it rose again, to 68%.

Be cautious when seeking income (Money Week), Rated: A

But Square Pie had sold bonds on the Crowdcube platform, offering lenders 8% a year. It illustrates why so many people are suspicious of mini-bonds (debt issued by small, retail-orientated firms). Anyone thinking of lending to just the one relatively new business has to be aware of the risks – and then ask: is 8% enough?

A more diversified option

The latest offering in this category comes from a platform called Goji, which aggregates a variety of direct-lending and peer-to-peer (P2P) platforms. It has just brought out a Renewables Lending Bond, which pays out anything from 5.5% for a three-year term (with regular income) to 7.6% over five years, where the interest is rolled up at repayment. The underlying assets are provided by a direct lender called Prestige Group, which lends to clean-energy projects.

The book of loans – around 39 – has an average duration of four years, with a typical loan-to-value ratio of between 70% and 80%.

2018 LightStream Home Improvement Survey (PR Newswire), Rated: A

More than half (58 percent) of homeowners are planning to spend money on home improvement projects in 2018, according to the fifth annual LightStream Home Improvement Survey. LightStream is the national online lending division of SunTrust Banks, Inc. (NYSE: STI). Budgets for renovations are on the rise: among homeowners planning renovations, 45 percent will spend $5,000 or more — an all-time survey high. Those planning to spend $35,000 or more doubled from 2017.

The survey shows robust enthusiasm for renovation, as well as a thoughtful desire to balance a home’s needs and the homeowners’ budget, so they have the financial confidence to move forward. Specifically, the survey revealed the following trends:

    • Home “Sweat” Home
      The majority of homeowners plan to invest sweat equity, as 65 percent say they’ll do at least some of the work themselves. The 18-34 group is particularly fond of do-it-yourself projects, with 70 percent planning to work on at least a portion of their renovation.
    • Staying — and Aging — in Place
      Only seven percent of homeowners are renovating to prepare their homes to be sold, the lowest percentage since 2015. Instead, 14 percent of homeowners across all age groups — not just baby boomers — are citing “aging in place” as a reason for making a home improvement. Even respondents aged 18 to 34 (11 percent) and 35 to 44 (10 percent) say they’re renovating “to prepare my home so I can stay in it as I get older.”
    • Tax Reform Boosting Budgets
      With recent passage of tax reform, homeowners have already begun calculating how the changes might affect what they spend on home improvements. One in four homeowners who have set a budget for renovation projects stated that tax reform has had an impact, with 18 percent increasing their budget and seven percent decreasing it.
    • Paying for Projects
      The majority of homeowners (62 percent) plan to pay for projects, at least in part, by using savings. Additional payment strategies were further revealed. Intent to fund through home equity lines of credit (HELOC) jumped from 10 to 13 percent. “U.S. economic growth and limited housing inventory have contributed to healthy home equity gains,” said Ellen Koebler, SunTrust head of consumer solutions. “HELOCs can offer a financial solution for many homeowners, as accrued value may be available to tap for renovations.”

At the same time, the percentage of people intending to use a home improvement loan has grown 29 percent from 2017 with 54 percent more 18- to 34-year-olds planning to fund projects through home improvement financing.

Crowdfunding your way to homeownership (Mic), Rated: A

According to recent research from the National Association of Realtors®, 24% of buyers under age 36 saved for their down payment for more than two years.

NAR research also found that 25% of homebuyers ages 36 and younger used a gift from relatives or friends for some or all of their down payment.

Platforms have popped up that simplify this process: HomeFundMe, which launched last year, and Feather the Nest.

An estimated 1,500 “nesters” have used Feather the Nest to crowdfund a down payment since 2014, according to company president Beth Butler, with an average goal of $10,000 to $15,000.

JPMC’s FinLab Launches $ 3M Contest For FinTech Startups (PYMNTS), Rated: B

To help identify FinTech products that may improve the financial health of underserved populations in the U.S., the Financial Solutions Lab (FinLab) launched its fourth annual $3 million challenge. The lab focuses on products that meet the financial needs of overlooked populations, JPMorgan Chase said in an announcement.

Accounts in Transit (O’Dwyer PR), Rated: B

Kwittken signs up Laurel Road, online lender of student loans, personal loans and mortgages. Aaron Kwittken’s firm will be responsible for raising awareness of the company’s products through content marketing, brand activations, thought leadership and traditional media relations. Laurel Road, which is part of Darien Rowayton Bank, recently surpassed $3 billion in student loan originations.

United Kingdom

Keeping the little guys in the loop: How Funding Circle hopes to fix the financial system (City A.M.), Rated: AAA

“When we think about the people we hire, it’s all about energy,” says Funding Circle co-founder James Meekings. “We want staff to share their excitement about what they do with others in the office – even if they’re talking about tax.”

“Even though we now have 800 employees, we still feel like a small business. We still push for opportunity and for people to be creative.”

VPC and Ranger funds see dividends tick up, but remain below target (AltFi), Rated: AAA

The £219m Ranger Direct Lending and £337m VPC Specialty Lending investment trusts have announced their latest quarterly dividends with both portfolios showing an uptick since their last pay-outs.

Leeds offers business loans through peer-to-peer platform (Room151), Rated: A

Leeds City Council is to use a peer-to-peer lending platform to lend money to local businesses.

The authority has decided to use the rebuildingsociety.com platform — based in the city — to provide money for small and medium sized businesses with an LS postcode.

Isas 2018: Innovative Finance Isas hit stumbling blocks (Financial Times), Rated: A

Innovative finance Isas (IF Isas) offer the promise of a good return, sheltered from tax, to investors willing to take on the higher risks of the peer to peer (P2P) finance market.

The market has taken longer than expected to ignite, however, as providers struggle to match growing demand with limited supply. Many new investors will find the door shut, at least for now.

Growing consumer indebtedness in the UK combined with the prospect of rising interest rates could push up default rates on loans, sharpening the dangers for those invested in the highest-risk P2P products.

How does the Isa allowance actually work? (Which?), Rated: B

For the tax year 2017-18, the maximum amount you can pay into one – or a combination – of Isas held in your name, is £20,000.

Once the new tax year for 2018-19 begins on 6 April, your allowance resets – once again to £20,000.

There are five main types of Isas. The current annual limits are as follows:

  • Help to Buy Isa: Money can only be used to buy your first home, and savings receive a government bonus of 25%. You can save £1,200 in the first month, then £200 per month thereafter. Therefore, in the first year you will have a limit of £3,400. In the following years the limit will be £2,400.
  • Lifetime Isa: Expressly for first-time buyers or to be used in retirement once the account holder has reached the age of 60. There’s a 25% government bonus on savings up until the account holder is 50 years old. You can pay in up to £4,000 per year.
  • Cash Isa: A traditional savings account – money you pay in grows with the provider’s interest rate. You can pay in up to £20,000.
  • Stocks & shares Isa: Money you deposit is invested in stocks & shares by the provider. Returns can be higher, but so is the risk that you may end up with less money than you paid in. There will also usually be fees involved for managing your investments. You can pay in up to £20,000.
  • Innovative finance Isa: Money paid in is invested in Peer-to-Peer (P2P) lending platforms, and you receive the interest when this loan is repaid. There is also some risk involved. You can pay in up to £20,000.
European Union

Klarna’s profits driven by growth in Nordics and Germany (Financial Times), Rated: AAA

The Swedish group posted a 27 per cent increase in revenues to SKr4.53bn ($546m) while net profit more than tripled to SKr346m. Klarna processed about €18bn in online transactions last year, an increase of 42 per cent.

Klarna reports double-digit sales growth (Finextra), Rated: A

As a result, 89,000 retailers globally now use Klarna products, this represents a 20% growth compared to the previous year. Available in 14 countries, retailers are increasingly adopting Klarna solutions which makes the payment processes as smooth as possible for consumers. As a result of the surge in retailer adoption, Klarna now handles 10% of all online payments in Northern Europe.

International

How Banking Institutions Can be Decentralized (CoinTelegraph), Rated: AAA

Decentralized banking is a term that has been construed in the wake of the cryptocurrency boom.

Cryptobanks are decentralized platforms that provide the usual services that centralized banks provide, primarily lending services and credit scoring, but essentially cuts out all of the middlemen that a centralized bank uses. The people needed in a bank to approve loans and structure financial data are replaced in a crypto banking ecosystem by smart contracts and p2p, peer-to-peer, services.

What kind of technologies do crypto banks use?

P2P, Blockchain, cryptocurrencies, Machine Learning, Big Data and smart contracts are used in crypto banking.

All transactions are recorded on the Blockchain.

Machine Learning Big Data.These technologies help to automate the lending process and cut through bureaucracy. AI can work 24/7 and match lenders with borrowers.

Do crypto banks have their own native currency?

Yes. Native cryptocurrencies help make the bank global.

Datarius, the first social p2p crypto bank, for instance, uses their own native token DTRC for all transactions. This helps create a standard for a global payment system within the p2p lending process.

What is social lending?

Thanks to Big Data and AI, crypto banks can see beyond a borrower’s credit score to identify their level of trust. Listings can include Trust Limit, Trust Management and User Ratings which helps AI decide if the participant is justified in borrowing from a specific lender.

Crowdlending: Anatomy of a successful strategy (EurekAlert!), Rated: A

The entrepreneur’s strategy for achieving this can be summarized in three stages. The first consisted of bypassing the banking monopoly on his platform using “cash vouchers,” a tool dating from 1937 that had long been forgotten. They allow personal loans to be made without a bank as intermediary. Secondly, by collaborating with future competitors, the public authorities and the sector’s regulators(2), the entrepreneur contributed to the development of a long-term crowdlending regulation in France. This collaboration relies on the creation of a meta-organization(3) called “Financement Participatif France” (FPF), which worked to define the status of “Intermédiaire en Financement Participatif” (IFP, equivalent to “crowdlending financing intermediary” in English), which regulates this new market.

Asia

Smartag International Signs Agreement to Provide Fintech Solutions to Rural Indonesia (PR Newswire), Rated: A

Smartag International, Inc. entered into a joint venture agreement with PT. Supratama Makmur Sejahtera (“PTSMS”), an Indonesian Fintech company to form a Joint Venture Indonesian PMA company in which Smartag will own 51% equity and PTSMS will own 49%. This follows an earlier MOU signed on October 12, 2017 between PTSMS and PT Rijan Dinamis Selaras (“RDS”) representing Pondok Pesantren Riyadhul Jannah Pacer Mojokerjo, founder of Consultative Assembly of Indonesian Boarding Schools which has a network of 28,000 boarding schools to undertake a Fintech project (the “Indonesian Project”).

Authors:

George Popescu
Allen Taylor

Friday February 9 2018, Daily News Digest

personal loans

News Comments Today’s main news: SoFi brightens startup scene in Helena, Montana. LendingTree rates Upgrade #1 personal loan. UK P2PFA gets a new head. India considering digital payments tax rebate for P2P lenders. Today’s main analysis: Why point-of-sale lending is hot. Today’s thought-provoking articles: Industrial loan company (ILC) applications may soon be seen in a positive light. P2P lending […]

personal loans

News Comments

United States

United Kingdom

European Union

International

India

Canada

Africa

News Summary

United States

Startup Fever is Catching on Everywhere (Even in this Little Montana Town) (Inc.), Rated: AAA

There is a new millennial-friendly mixed-use development with a high-end steakhouse, movie theater, and hotel. And yes, even a town of 30,000 located more than 500 miles from the closest major metropolitan areas (Salt Lake and Seattle) has an entrepreneurial ecosystem. In fact, in some ways Helena has a startup scene larger cities would be jealous of. A few years ago, SoFi, the online student loan servicer that also provides personal loans and mortgages, contracted with two local programmers to help build their platform.

One of those programmers, David Thompson, is a graduate of the University of Montana-Western, Montana Tech, and the University of Montana. David had no interest in moving to the Bay Area, and successfully convinced SoFi to locate a substantial portion of its engineering team in Helena. Today SoFi is multi-billion-dollar startup, and David is the VP of Engineering, managing more than 100 programmers and engineers out of two locations in Helena.

For the last several decades–and especially over the last few years–we’ve heard a lot about the death of small towns and middle America. However, the success of SoFi and the emerging startup scene in Helena shows the potential for tech companies to be agents of economic revitalization in small towns and cities outside of the coasts.

LendingClub Schedules Fourth Quarter 2017 Earnings Release and Conference Call (PR Newswire), Rated: AAA

LendingClub (NYSE: LC), America’s largest online marketplace connecting borrowers and investors, announced that it will report earnings for the fourth quarter of 2017 on Tuesday, February 20, 2018, after market hours. LendingClub will host a conference call to discuss the fourth quarter financial results at 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time) on the same day.

A live webcast of the call will be available at  under the Events & Presentations menu. To access the call please dial +1 (888) 317-6003 or outside the U.S. +1 (412) 317-6061 with conference ID 8062913 ten minutes prior to 2:00 p.m. Pacific Time (or 5:00 p.m. Eastern Time).

Elevate Credit Fourth Quarter and Full Year 2017 Earnings Release Available on Its Investor Relations Website (BusinessWire), Rated: B

Elevate Credit, Inc. (“Elevate”), a leading tech-enabled provider of innovative and responsible online credit solutions for non-prime consumers, today announced financial results for the fourth quarter and full year 2017. Elevate has posted its fourth quarter and full year earnings release to its Investor Relations webpage at 

The Company will host a conference call to discuss its fourth quarter and full year financial results on Thursday, February 8th at 4:00 p.m. Central Time / 5:00 p.m. Eastern Time. Interested parties may access the conference call live over the phone by dialing 1-877-407-0792 (domestic) or 1-201-689-8263 (international) and requesting the Elevate Fourth Quarter and Full Year 2018 Earnings Conference Call. Participants are asked to dial in a few minutes prior to the call to register for the event. The conference call will also be webcast live through Elevate’s website at 

Upgrade, Inc. Rated #1 Personal Loan by LendingTree (PR Newswire), Rated: AAA

Upgrade, Inc. (), a consumer credit platform that combines personal loans with tools that help consumers understand and monitor their credit, announced that it has been named #1 in the personal loans category for the fourth quarter of 2017 by LendingTree.

Why point-of-sale lending is hot right now (American Banker), Rated: AAA

But research conducted by banks and fintechs has found that many younger Americans are uncomfortable carrying credit card balances, partly because they saw their parents struggle with debt during the financial crisis and prefer the more certain repayment terms of installment loans.

Personal loans issued by banks — these exclude credit cards and auto and home equity loans — hit a record $807 billion at Sept. 30, according to data from the Federal Deposit Insurance Corp., up 9% from two years earlier and nearly 30% since 2012. That’s not even including the many billions of dollars of loans made by upstart online lenders that don’t end up on banks’ balance sheets.

San Francisco-based Affirm originated more than $1 billion in point-of-sale loans last year — and, increasingly, regional banks that are funding the loans, either directly or behind the scenes.

Source: American Banker

Inside Overstock.com’s financial services strategy (Tearsheet), Rated: A

For the past few months, the 19-year-old e-commerce company has been quietly building out FinanceHub, a sort of marketplace for financial services that includes existing Overstock credit cards and insurance products; loans by LendingTree, Prosper and Sofi; a robo-adviser for automated investing, as of last week — and as of Tuesday morning, a discounted trading platform.

Fintech Firms Look to Enter Banking Via Century-Old Tactic (WSJ), Rated: AAA

Financial-technology firms eager to offer banking products are eyeing a century-old model that fell out of favor during the financial crisis but could see a revival under the Trump administration.

The industrial loan company charter, available in a handful of states and particularly popular in Utah, allows nonfinancial companies to enter the banking sector without being subject to many of its restrictions, including oversight by the Federal Reserve. Companies seeking the charters must still obtain deposit insurance from the Federal Deposit Insurance Corp., which last approved insurance for an industrial loan company in 2008.

That could soon change. President Donald Trump’s pick to head the FDIC, Jelena McWilliams, suggested during Senate testimony last month that she would look favorably on new applications.

Source: The Wall Street Journal

Who Is Chris Larsen? Founder Of Ripple Tops Forbes Cryptocurrency List (International Business Times), Rated: A

According to Forbes, Larsen’s net worth is between $7.5 billion and $8 billion in cryptocurrency, in large part thanks to his massive holding of Ripple—the cryptocurrency he co-founded in 2012.

Larsen, a Stanford M.B.A. and veteran Silicon Valley player, is no stranger to the world of digital finance. Prior to his involvement in cryptocurrency, he co-founded the online mortgage lender E-Loan. The company was valued at $1 billion in 2000. In 2006, he co-founded Prosper Marketplace—the first peer-to-peer lending marketplace in the United States.

Goldman Sachs is trying to build the ultimate financial destination for the masses (Business Insider), Rated: A

Individuals looking to saddle up with the prestigious bank needed to fork over a minimum investment of $10 million for wealth management services. The typical client had more than $50 million in investable assets.

Personal Capital Launches Socially Responsible Investing (Finovate), Rated: A

Wealth tech company Personal Capital is making it easier for investors to put their money in causes that are important to them with the launch of its Socially Responsible Personal Strategy today.

Autobooks Raises $ 10M in Series A1 Funding Round (Finsmes), Rated: A

Autobooks, a Detroit, MI-based fintech startup, raised $10M in Series A1 funding.

Toyota partners with AI firm Aire to spot finance delinquency (Motor Finance), Rated: A

Toyota Financial Services (TFS) has launched an evaluation of AI software from Aire to spot customers with higher risks of delinquency.

Aire’s machine learning technology will identify which lessees have entered customer delinquency by skipping a payment, and will give TFS an estimate on how likely they are to default on further instalments.

Aire’s software has already been used by lenders, including p2p lender Zopa, in the initial credit application phase.

Confluent Continues Momentum in 2017 with 4X Subscription Growth (Digital Journal), Rated: A

Confluent, provider of the streaming platform based on Apache Kafka, today announced 2017 results, which include 4X subscription growth year over year and 98 percent customer satisfaction.

In the 2017 Apache Kafka Report, many companies reported using the distributed streaming platform for more accurate and faster decision making, reduced operating costs, improved customer experiences and reduced risk. 1 in 4 respondents work for organizations with more than $1 billion in annual sales, illustrating how quickly this technology has gained traction across large enterprises. In addition, more than 15% of respondents are processing more than a billion messages a day.

Other 2017 highlights include:

  • Raised $30 million from Sequoia, Index Ventures and Benchmark to meet global demand for streaming platforms.
  • Expanded employee base by 120 percent, added numerous offices throughout the US and extended its footprint to six additional countries.
  • Added new customers around the globe, including Alight Solutions, Capital One, Funding Circle, HomeAway and Nordea Bank.
  • Announced the general availability of Confluent Cloud, an Apache Kafka as a Service offering that empowers enterprises and developers to move faster with streaming data.
  • Surpassed 200 partners, including some of the largest Systems Integrators and Platform partners in the industry.

Fintech partnerships can work (American Banker), Rated: A

That Radius Bank in Boston would strike another fintech partnership — it announced one Wednesday with the startup Mantl, which is trying to cut down online-account openings to four minutes — is less revealing than its part in Radius’ evolving MO.

When Nathaniel Harley, CEO of Mantl, first visited Radius, he was seeking feedback on a personal financial management technology the company was working on. But he was quickly talked into changing the direction of his company.

The two companies started building an account-opening system for all digital channels in March 2017. They worked to reduce manual entry and other hassles from the account-opening process. Mantl brought in one of its own fintech partners, Alloy, to handle much of the decisions, including anti-money-laundering checks, identity verification and fraud detection. Radius and Mantl used Alloy’s workflow management tool to configure the decision-making process.

Source: The American Banker

Mulvaney can’t just kill CFPB payday rule, but here’s what he can do (American Banker), Rated: A

Banking rules cannot be rewritten overnight, and so acting Consumer Financial Protection Bureau Director Mick Mulvaney has a tall order remaking the payday loan regulation crafted under his predecessor. But observers say Mulvaney has options for altering the rule to the industry’s favor.

One option would be to refocus the rule on disclosure requirements, which would be several steps short of a repeal but more amenable to lenders than the current CFPB regulation.

Democratic senators demand answers on CFPB’s stalled Equifax data breach investigation (Housingwire), Rated: A

Did the Consumer Financial Protection Bureau kill its investigation into Equifax’s data breach that exposed the personal information of 145.5 million U.S. consumers to hackers?

On Thursday, a group of 32 Democratic senators sent a letter to the CFPB, demanding answers on the state of the bureau’s investigation into the Equifax breach.

CFPB Seeks Comment on its Enforcement Processes (The National Law Review), Rated: A

The CFPB has issued a request for information that seeks comment on how the agency can best achieve meaningful burden reduction or other improvement in the processes it uses to enforce federal consumer financial law while continuing to meet the CFPB’s statutory objectives and ensuring a fair and transparent process.  Comments on the RFI must be received no later than 60 days after the date it is published in the Federal Register, which the CFPB expects to be February 12, 2018.

In the new RFI, the CFPB now seek comment on all aspects of its enforcement processes but lists the following seven topics:

  • Communication between the CFPB and subjects of investigations, including timing and frequency of such communications and information provided by the CFPB on the status of an investigation
  • Length of CFPB investigations
  • Notice and Opportunity to Respond and Advise (NORA) process, including whether the NORA process should be mandatory rather than discretionary and the information contained in letters the CFPB may send to potential subjects of investigations pursuant to the NORA process
  • Whether subjects of potential enforcement actions should have the right to make an in-person presentation to the CFPB before the CFPB decides whether to initiate legal proceedings
  • Calculation of civil money penalties, including whether the CFPB should adopt a civil penalty matrix
  • Standard provisions in CFPB consent orders
  • Manner and extent to which the CFPB can and should coordinate enforcement activity with other federal and/or state agencies with overlapping jurisdiction

Altegris To Merge With Artivest (PR Newswire), Rated: A

Altegris, an alternative investment research and management firm, and Artivest, an alternative investment technology firm, announced today that they plan to merge under the name Artivest, pending customary corporate and regulatory conditions to closing. The joint 100-person team will service over $3 billion in client capital—immediately becoming the largest independent alternative investment technology and solutions firm for wealth managers, fund managers, and independent advisors.

SharesPost Launches Unit Focused On Initial Coin Offerings; Hedge Fund Executive John Wu To Lead Group (BusinessWire), Rated: A

Taking a next step in its mission to provide liquidity to private growth companies,SharesPost today announced the launch of its Digital Securities Group.

The Digital Securities Group will bring security token issuers and investors into the SharesPost private marketplace. Token issuers and investors will use SharesPost’s existing Alternative Trading System to invest in ICO’s and trade in digital securities in compliance with U.S. securities laws.

Lenders to allow Airbnb income on mortgage forms (MarketWatch), Rated: A

Homeowners soon will be able to count income they earn from Airbnb Inc. rentals on applications for refinance loans.

A new program — expected to be announced on Thursday by Airbnb, mortgage giant Fannie Mae and three big lenders — will allow anyone who has rented out property on Airbnb for a year or longer to count some or all of that money as income.

SEC Exams to Focus on Disclosures, Robos, Cryptocurrencies (Financial Advisor IQ), Rated: B

In 2018 the SEC’s Office of Compliance Inspections and Examinations plans to pay closer attention to matters involving retail investors, particularly when it comes to disclosures, and zero in on cryptocurrencies, initial coin offerings and secondary market trading, the regulator says in a press release.

The regulator will also continue monitoring digital advice platforms, with a special focus on their compliance programs, including algorithm oversight, investor data protection and disclosures of conflicts of interest, according to the exam priorities. The SEC has made progress in the ratio of investment advisors it examines each year, from just 8% five years ago to 15% in fiscal year 2017, the regulator says. In 2018, the SEC plans to target those advisors it has never examined before, according to the regulator.

Former Keller Williams CEO Chris Heller joins loanDepot brand family as CEO of mello Home (loanDepot), Rated: B

LD Holdings Group, LLC, parent company of loanDepot, the nation’s fifth largest retail lender, today appointed top real estate executive Chris Heller to head its recently-launched mello Home business. Combining digital simplicity and smart local advice, mello Home seamlessly connects home buying, financing, and improvement services into a single consumer experience.

Fintech looks to the future of financial advice at T3 (InvestmentNews), Rated: B

If the theme of the 2017 T3 Conference was the fiduciary rule, 2018 was all about the future of financial advice.

Quovo launched Cue, a new alerts engine that leverages Quovo’s aggregation technology to notify financial advisers about account activity and client milestones.

MoneyGuidePro announced a new partnership with MX, a data aggregation provider, that lets advisers bring held-away assets into the financial planning software.

 

United Kingdom

UK P2P Finance Association Announces a New Leader (Lend Academy), Rated: AAA

It was through the work of the P2PFA, led by Christine Farnish, that these regulations were sensible and promoted the growth of the industry there. And while this initial regulatory framework is currently being reviewed by the FCA, today, the UK is one of the most competitive markets in the world in no small part because of these initial regulations.

Paul Smee brings more than 17 years experience in leading trade bodies in the UK. Previously, he was Director General of the Council of Mortgage Lenders for six years so he comes with experience leading finance trade bodies. He looks like a great choice to take over from Christine.

City Moves for 9 February 2018 – who’s switching jobs at Lendy, RegTek.Solutions and M&G? (City A.M.), Rated: B

Lendy, one of Europe’s leading P2P secured property platforms, is pleased to announce the appointment of Andrew Wawrzyniak as its new head of finance. Andrew was previously head of finance at Fund Partners, a leading fund manager, which specialises in the operation of collective investment schemes.

RegTek.Solutions, the market-leading control and compliance software provider for global trade and transaction reporting, has appointed Rob Bernstein as chief financial officer (CFO).

Rebuildingsociety partners with Leeds Council to support local businesses (P2P Finance News), Rated: A

PEER-TO-PEER business lender Rebuildingsociety has secured an agreement with Leeds City Council whereby the local authority funds loans through its platform.

The council will review business loan requests from companies with an LS postcode prefix, consider the industry and location of the company, and contribute to the loan amounts required by suitable applicants.

European Union

P2P Lending Is Becoming A Significant Income Source For Young Investors (Crowdfund Insider), Rated: AAA

According to Robo.cash, P2P lending is turning to a significant source of additional income for the growing number of the European investors.

The online lending platform also confirmed:

“The majority of investors are in the age groups: 25-34 years — 40%, 35-44 years — 31%, 45-60 years — 20%. The less number is the age of 18-24 years (6%) and 61 plus (3%). These figures are supported by the employment of investors: employees — 72%, entrepreneurs — 15%, students — 6%, retiree — 2%. At the same time, the most investors are just getting acquainted with P2P-services (52%) and the comparable number already has at least one-year practice: 1-3 years — 34% and over 4 years — 13%.”

Is Lithuania the most fintech-friendly destination in Europe? (Finextra), Rated: A

The country has been actively promoting itself as gateway destination to the European marketplace for non-EU firms and British startups fleeing Brexit. Registering a company takes merely three days, while getting a Payment Institution or Electronic Money Institution license takes only three months, two-to-three times faster than in other EU jurisdictions. Other perks include remote Know Your Customer (KYC) procedures, low profit tax, startup visa options and a sandbox regime for fintech startups in their first year.

The country also boasts a growing talent pool of up to 31,000 trained IT professionals with a further 8000 in the pipeline.

Lithuania Registered 35 New Fintech Companies in 2017 (Crowdfund Insider), Rated: B

This week, Invest Lithuania released the Lithuania Fintech Report 2017, which revealed that a total of 117 fintech companies were operating in the country in 2017, with 35 of them being registered last year.

International

IOU financial partners with goEBT to offer funding to network of 25,000 convenience store owners (Business Insider), Rated: AAA

IOU FINANCIAL INC. (“IOU” or “the Company”; TSX-V:IOU), an online lender to small businesses (IOUFinancial.com), is pleased to announce a strategic partnership with Marietta, GA-based c-store solutions provider goEBT (goEBT.com).  Through this strategic partnership, goEBT’s network of 25,000 convenience store owners nationwide will be able to access IOU’s fast, convenient, non-collateral funding solutions.

LENDDO AND EFL TEAM UP FOR FINANCIAL INCLUSION (#Include1Billion), Rated: A

Our companies come together united by the common vision of providing financial inclusion for more than one billion new and underserved individuals across the globe. We will together provide a suite of credit scoring and identity verification products to more than 20 emerging markets.

Our companies have individually facilitated over 5 million credit assessments since inception, allowing more than 50 financial institutions to disburse over $2 billion USD in credit to people with limited information.

The first joint product offering is already live in Asia and Latin America, with additional products and features scheduled for release in the coming months.

From #Include1Billion

Fuse Business Loans from Mynt began working with LenddoEFL to assess credit risk for its clients that were 80% unbanked.

Foxconn’s Gou said to invest in US crypto merchant bank venture (EJ Insight), Rated: A

Terry Gou, the billionaire chief of Taiwanese electronics giant Foxconn, is said to have invested in a cryptocurrency merchant bank being set up by Mike Novogratz, a former Wall Street macro hedge fund manager.

Citing a source familiar with the matter, Bloomberg reported that Novogratz has raised about US$250 million for his cryptocurrency merchant bank venture through a private placement.

India

Google search bias fine, Swiggy funding, Digital payments tax rebate & more (ET Tech), Rated: AAA

The government might consider giving tax rebates to merchants accepting payments digitally in order to promote the overall fintech sector, which is at its infancy at present but growing at a rapid pace, suggested the Reserve Bank of India.

Talking about the fintech sector the RBI has identified tech startups working in the space of peer-to-peer lending, blockchain, big data, smart contracts, robo advisors and online aggregators.

Read more.

HOW TO FUND YOUR HIGHER STUDIES (Money Today), Rated: AAA

Traditionally, one’s option was limited to getting an education loan from a public sector bank. Now that the demographics are favourable and the education loan market has the potential to grow, non-banking finance companies (NBFCs), fintech players and peer-to-peer (P2P) lenders are jockeying for a piece of the market.

Seek more funding: Education loans are part of the priority lending category, but unlike the US, there is no provision for student loan waiver in India. It means your loan will not go away until you pay it off. Try and find out if there is any other source of funding available, including financial aid, bursary and scholarship or upfront savings, which will bring down the loan amount.

What Banks Offer

Most of them offer education loans for studying medicine, engineering or management at graduate and post-graduate levels or for pursuing further studies in India and abroad. Some also provide categorised loans. For instance, State Bank of India (SBI) offers Scholar Loan for students who get admitted to premier institutions like IITs, IIMs, NITs and AIIMS, and a Global Ed-Vantage loan for studying in global counterparts. Bank of Baroda offers Baroda Scholar loan for studying abroad and Baroda Gyan loan for higher studies in India while separate schemes are available for courses conducted by the country’s top institutions.

Source: Money Today

Fintech/P2P Players

Landing an education loan may not be easy anymore, given the spurt in defaults. And that is where the new-age fintech firms and P2P lenders see a lucrative opportunity. “For those who fail to qualify for education loans from banks and NBFCs, P2P lending platforms can be an alternative way to borrow,” says Gaurav Aggarwal, Associate Director, Unsecured Loans, at Paisabazaar. In other words, aspiring students can raise personal loans from banks or fintech players like MoneyTap and LoanTap, or P2P lenders like Faircent and CreditMantri to cover their educational expenses.

What Lies Ahead For India’s Fintech Sector? (CXO Today), Rated: A

To understand what lies ahead for India’s fintech sector, it makes sense to understand the fintech growth is expected to boom in the Asia Pacific region. A Frost & Sullivan report predicts that the region is expected to grow at a CAGR of 72.5% from 2015 to 2020, reaching US$72 billion.

According to Quah Mei Lee, Industry Principal, ICT, Asia-Pacific, the mobile payments market in Singapore was estimated to be worth US$1.4 billion in 2017. The market is still small but is growing fast.

Indian digital payments industry is expected to reach $700 billion by 2022 in terms of value of transactions.

It is expected that more than 80% of the urban population in India will adopt digital payments as a part of their routine by 2022, and 70% of the retail chains will adopt the same.

Canada

A Canadian Way to Access US Small Business Lending (Stockhouse), Rated: AAA

Enter IOU Financial.  As “online lending” has become a 21st century reality, a financial niche has sprung up with online lending institutions that are prepared to cater to small businesses and provide badly needed capital, efficiently and affordably.

Compared to the above, IOU Financial provides easily manageable, working capital term loans for small business, and does so:

  • Quickly
  • Efficiently
  • Affordably

The speed of IOU’s loan application process is a big draw for small business owners.  IOU’s application generally takes roughly three to five minutes to complete.

Source: Stockhouse

 

Grounded Kitchen & Coffeehouse is OnDeck’s Small Business of the Month (PR Newswire), Rated: A

OnDeck (NYSE: ONDK), the online lender to small businesses, today announced that Grounded Kitchen & Coffeehouse, owned by Amir Rahim, has been selected as the OnDeck Small Business of the Month for February, 2018. The Ottawa-based restaurant is the first small business in Canada to earn the OnDeck spotlight award.

Africa

Glaring Ponzi Schemes In Ghana Now (Modern Ghana), Rated: A

So assuming I have $1000.00 I have no use for and would want to make a little interest on, All I have to do is go unto one of these platforms to match me with someone in need of $1000.00. These platforms because of the high risk they take (borrowers don’t provide tangible collaterals) usually charge higher interest and in return given higher interest to lenders than Treasury Bills will normally do. This idea is supposed to be easy and help people financially as there is gap between loans needed and financial institutions willing to give (“The two largest peer-to-peer (P2P) lending platforms, Prosper and LendingClub founded in 2005 and 2006 respectively, have originated over $6 Billion in loans to date. Although they have only begun to scratch the surface of the $3 trillion consumer debt market” Nav Athwal Cofounder and CEO of RealtyShares, a crowdfunding for real estate platform). Yet like most good things miscreants, hooligans and hoodlums find a way to make the system corrupt.

These swindlers promise up to a 100% interest rates within 5 working days. So they lure greedy but naïve people to roll in cash through mobile money. With a Minimal amount of GHC100.00 you get registered and paired with another person. You’re required to send the money to this person who they claim registered 5 days ago and the said day is the day of maturity.

Ways to spot financial scams and Ponzi schemes
1. If your interest is too good to be true, then its probably a lie. When you’re being offered an interest bigger than the T Bills in lending you should be wary and do due diligence.

2. They usually don’t tell the project in which your money will be invested.

3. Pressurised to respond quickly? 4. Are the contact details vague?

Authors:

George Popescu
Allen Taylor