Tuesday October 9 2018, Daily News Digest

LendingClub

News Comments Today’s main news: China Rapid Finance issues regulatory report, board change. H&M invests in Klarna. Tencent drops $180M into Nubank. KKR, Tencent lead $175M investment into Voyager. Today’s main analysis: Gen Z is more optimistic than millennials about home ownership. Today’s thought-provoking articles: The cities in America with the biggest houses. Inside Ameritrade’s integration with WeChat. Unemployment rate […]

LendingClub

News Comments

United States

United Kingdom

China

European Union

International

Other

News Summary

United States

Startup Credit Kit; 48-year Low Unemployment Rate (PeerIQ), Rated: AAA

The US economy added 134k jobs in September and the unemployment rate dropped to a low of 3.7%  – a level not seeing since the Beatles broke up in 1970. Wage growth came in strong at 2.8%, and raises the specter of inflation down the road.

Point-of-Sale lending continues to grow, with Square now providing instalment loans of up to $10,000 to shoppers who purchase big-ticket items from Square’s merchants. Borrowers can repay in fixed monthly payments over a period of 3, 6, and 12 months with interest rates ranging from0% to 24%. The move puts Square in direct competition with other POS lending services – Affirm, Klarna, Greensky and more.

In regulatory news, the FDIC has received 21 banking applications this year, over twice the number for last year. The FDIC however has approved only 4 of these applications to date.

PeerIQ’s Learning of the Week

This week we look at the performance of LendingClub’s 36-month loans. Over the life of the loans, borrowers with verified income have 140 bps higher losses. This is due to a “selection effect” – namely, LendingClub applies an extra layer of income verification high credit risk borrowers.

Source: PeerIQ

LendingTree Reveals the Cities with the Biggest Houses in America (LendingTree), Rated: AAA

LendingTree compared home sizes across the country, but first, let’s look at some national data. The Census Bureau reports that the median size of new homes completed in the second quarter was 2,412 square feet. Home sizes have leveled off the past few years from a peak of 2,488 square feet in the third quarter of 2015, though homes sizes are generally larger today than they were for previous generations.  Because only a small proportion of the housing stock is new each year, the median size of all homes is lower given a median house age of 37 years.

Key findings

  • Everything is bigger in Texas. Whoever coined this phrase must have been thinking about real estate. Houston leads the list, with Austin and Dallas also in the top five. Besides having a lot of space, Texas has been adding new residents at a steady pace, with the nation’s largest annual population growth between 2010 and 2016. More new homes means larger homes.
  • South equals size. Other Southern cities dominate the top 10, with Atlanta, known for its sprawl, at No. 2.
  • Money talks. The Washington, D.C., area, whose suburbs includes the three wealthiest counties in the country, comes in third. Boston, another wealthy city, shows up at ninth.
  • Show me? The Midwest lives up to its unpretentious reputation by having the most cities with the smallest houses. Missouri’s Show Me State nickname clearly does not refer to houses, with its two largest cities both in the bottom 10.
  • Older is smaller. Cities with older housing stock have smaller houses, including Detroit at  No. 45 on our list.
Source: LendingTree
Source: LendingTree

More Optimistic Than Millennials, Gen Z Is Here to Revolutionize the Housing Market (Property Shark), Rated: AAA

Key takeaways:

  • Gen Z has its eye on homeownership, with 83% planning on buying a home within the next 5 years
  • College debt is the #1 obstacle towards homeownership for Millennials and Gen Z
  • Gen X chooses intergenerational living to care for relatives more often than any other generation
  • Gen Z is willing to compromise on almost anything to keep costs down – but dreams of lots of space and amenities
  • Gen Z to pose serious competition to Millennials on the real estate market
  • Millennials are more realistic about their means, and the most pessimistic about the prospect of homeownership
Source: PropertyShark

Whatever they may see as the most significant hurdle towards homeownership, more than 80% of respondents from all three generations expect to buy a home in the next 5 years. Part of more established family units and with stabilized careers, Gen Xers are the least likely to buy homes in the near future, while Millennials are the most likely – 87% of Millennial respondents expect to enter homeownership within 5 years.

Considering that the oldest of Gen Z are barely 23, it is noteworthy that a whopping 83% see themselves entering the real estate market within 5 years.

Source: PropertyShark

B+E announces sale of Darien TD Bank property for $ 6.9 million (Patch), Rated: A

B+E (Brokers+Engineers), the first brokerage firm and trading platform for net lease (NNN) real estate, today announced the sale of property that is leased long-term to TD Bank in Darien, Connecticut.

Located at 55 Boston Post Road, the +/- 4,380SF location was sold for $6,900,000 at a 5.1% cap rate. The property has +/- 7 years remaining on the lease and was sold to a 1031 exchanger. B+E represented the seller, Chimblo Family Real Estate, LLC.

Real Estate Startup Landis Raises $ 2M in Funding (Finsmes), Rated: A

Landis, a NYC-based marketplace for institutional real estate investing, raised $2M in funding.

The round was led by Signia Venture Partners with participation from Red Swan Ventures, Graph Ventures, and Kima Ventures, as well as the founders of RealtyShares (Nav Athwal), Compass, Floored, Tango, Rypple, and Stanford professor and JetBlue Chairman Joel Peterson.

Fintech firm Curve looking to raise $ 50 million to become the ‘Amazon of banking’ (CNBC), Rated: A

Fintech firm Curve is aiming to raise $50 million in funding, its CEO told CNBC in an exclusive interview, as it looks to get some cash to boost its aim to become the “Amazon of banking.”

Smartphone brand can reflect creditworthiness: FDIC study (American Banker), Rated: A

A new study released Thursday bolsters the case for lenders to use borrowers’ digital footprints in assessing their creditworthiness.

The paper, released by the Federal Deposit Insurance Corp.’s Center for Financial Research, said the data trails people leave online — even down to what brand of smartphone they use — are useful at predicting default rates.

Fed studies rural branch closings (American Banker), Rated: A

For a regulator grappling with what is the right balance in big-bank supervision, the Federal Reserve is also trying to drill down on industry trends at the most micro levels.

The Fed’s top regulatory official, Vice Chairman of Supervision Randal Quarles, gave wide-ranging remarks Thursday on the central bank’s efforts to gather and understand data about the community banking sector.

AFR Promotes Brandao to President and Packer to COO (Business Insider), Rated: B

American Financial Resources, Inc. (AFR) is pleased to announce two key executive promotions. Laura Brandao has been promoted to President and Bill Packer is now Chief Operating Officer of the NJ-based leading niche lender.

United Kingdom

Are there too many property investment platforms? (Development Finance Today), Rated: A

A recent poll conducted by Development Finance Today revealed that 65% of industry professionals believed that there were too many property investment platforms in the market.
Source: Development Finance Today

I’m Stephen Moss, the founder and managing director of Sourced (Property Investor Today), Rated: A

Established to match UK and overseas investors with hand-selected investment opportunities, we offer UK-wide investment advice and property sourcing through our 34-strong network of franchises.  This guarantees the same level of local knowledge and off-market opportunities, anywhere in the country.

Since we started in October 2017 our network has grown from one to 34 offices, we have launched a new peer-to-peer (P2P) lending platform and we’re building on our current position as the country’s largest property investment platform and network of property sourcers.  We’re also the first company to provide a free online training platform that gives investors of all levels of experience, the skills, knowledge and support they need to grow their portfolios.

Multiply: the new app that wants to put a financial adviser in everyone’s pocket (Evening Standard), Rated: B

Multiply is the latest fintech app launching on the Apple App Store, which wants to be your own personalised financial adviser so you can understand your money and the best things to do with it.

How Manchester entrepreneurs should begin investing (About Manchester), Rated: B

  • Peer to peer lending – you may have heard of popular companies in this investment sector such as Funding Circle. With peer to peer lending, you lend money to business start-ups to help them become established. When they are profitable you get your money back with any agreed interest.
China

China Rapid Finance Announces Regulatory Report & Board Change (Crowdfund Insider), Rated: AAA

China Rapid Finance Limited (NYSE: XRF) announced last week that it submitted its P2P Compliance Self-Inspection Report to its local P2P regulatory office. According to the online lender, this new report is considered the first of three steps mandated in the inspection process, a key element in demonstrating compliance with industry reforms being promulgated by the National P2P Rectification Office.

China Rapid Finance then explained it is focused on the next two process steps:

  • A self-disciplinary inspection conducted by NIFA and regional regulatory authorities
  • verification of inspection results by the regional P2P Rectification Office to conduct on field inspections

China Looks to Foreign Investors and Pensioners as Distressed-Debt Saviors (The Epoch Times), Rated: A

According to data from Bloomberg, China’s total balance of non-performing loans (NPLs) reached 1.96 trillion yuan ($285 billion) at the end of June 2018. To help lower this figure, China has been pawning off toxic loans onto foreign investors and unsuspecting pensioners.

Oaktree Capital Management in September acquired 115 NPLs for 2.4 billion yuan ($350 million) from one of China’s “bad banks” China Huarong Asset Management Co., according to Bloomberg.

The digital divide: inclusion must not create exclusion (The Finanser), Rated: A

There’s a legitimate concern that the change that’s happened in Chinese society since 2014 with regard to rapid conversion from cash and cards to mobile payments has been too fast for some. What happens to those left behind in the digital economy?

European Union

H&M buys $ 20 million stake in Swedish fintech firm Klarna (Reuters), Rated: AAA

Fashion chain H&M (HMb.ST) is acquiring a small stake in Klarna in what will be the Swedish online payments services firm’s largest partnership so far.

H&M is paying around $20 million for a stake of less than 1 percent, a Klarna spokeswoman said, confirming a Financial Times report on Monday.

Mintos partners with Trustly to offer real-time transfers (P2P Finance News), Rated: A

MINTOS, Europe’s largest peer-to-peer marketplace, has partnered with payments company Trustly to offer its customers the option to transfer funds in real-time from bank accounts across Europe.

Mintos said the collaboration with Swedish e-payments company Trustly will allow investors using its platform to transfer money in real-time from bank accounts across 29 European countries. This strips out the usual waiting time that is associated with conventional clearing systems.

Money laundering and backlogs dent ING’s image as tech leader (American Banker), Rated: A

Since taking charge of ING Group in 2013, Chief Executive Officer Ralph Hamers has labored to make it the most digitally advanced lender in Europe. His motto: disrupt yourself before a competitor does it first.

It’s safe to say the tumult at ING during the last few weeks isn’t what Hamers had in mind.

Equity Crowdfunding Platform Anaxago Launches Asset Management Firm Anaxago Capital (Crowdfund Insider), Rated: B

Anaxago is launching an asset management firm, Anaxago Capital, to attract more institutional investors and ready itself to fund larger projects. With this, Anaxago expects to double its outstanding investments by 2020.

International

China’s Tencent invests $ 180 million in Brazil fintech Nubank (Reuters), Rated: AAA

Chinese gaming and social media firm Tencent Holdings Ltd (0700.HK) paid $180 million for an undisclosed minority stake in Brazilian financial technology company Nu Pagamentos SA, both companies said on Monday.

Inside TD Ameritrade’s integration with WeChat (Tearsheet), Rated: AAA

TD Ameritrade continues to explore how to connect with its clients over different platforms.

The company, which has already launched experiences on Messenger, Twitter DM, Amazon Alexa devices and Apple Business Chat, has launched a chatbot for WeChat.

TD Ameritrade’s chatbot allows retail investors in Hong Kong to do their research, access market information, and get support through one of the most popular social and messaging platforms in Asia.

Celsius, Pays Interest To Crypto Depositors (CoinTrust), Rated: A

Celsius, a recently established cryptocurrency lending firm, has announced that it offers interest to thousands of users who deposit Bitcoin and Ether with its wallet application. Celsius claims to have won over 10,000 users since its mobile app was launched on June 29, with an average deposit of 0.5 BTC or 5.50 Ether earning as much as 6.7% per annum. Celsius generates the interest income by lending the crypto to hedge funds which open short position in the crypto market.

APAC

KKR and Tencent lead $ 175m investment in Philippines’ Voyager Innovations (Banking Tech), Rated: AAA

Telco PLDT, investment firm KKR and Tencent are part of a $175 million investment in Philippine digital tech company Voyager Innovations.

MENA

UAE-based startup Smart Crowd just got funded by Shorooq Investments (Startup MGZN), Rated: AAA

Smart Crowd, a new real estate crowd investing platform is just closed a Seed Funding round with $600,000 from Shorooq Investments, followed by Abaxx Technologies500 Startups, and other high-level strategic individual investors.

Authors:

George Popescu
Allen Taylor

Thursday September 21 2018, Daily News Digest

Chinese companies surge on debut after US IPOs

News Comments Today’s main news: LendingClub spent $6.4M to relocate two executives. Funding Circle to price IPO between 420-530 pence. Funding Circle to set valuation at $2.4B after IPO. Qatar fund to invest in Lufax. X Financial completes IPO. Today’s main analysis: Fintech investors like ‘stodgy’, not ‘sexy’. Prospa has written $750M in loans. Today’s thought-provoking articles: How machine learning helps P2P […]

Chinese companies surge on debut after US IPOs

News Comments

United States

United Kingdom

China

Other

News Summary

United States

Some Companies Spend Plenty to Lure Executives Willing to Relocate (Wall Street Journal) Rated: AAA

Some businesses have gone so far as to shell out millions to move key players from miles away. LendingClub Corp. LC -2.63% spent nearly $6.4 million to bring two new top officers and their families to the San Francisco Bay Area in 2017, according to an analysis of data from company proxies by research firm Equilar Inc. That sum largely reflects $3 million in relocation bonuses for Steve Allocca, the new president, and Thomas Casey, LendingClub’s chief financial officer. Both men moved from less-costly cities in Texas.

Source: Wall Street Journal

Fintech investors like ‘stodgy more than sexy’ (Financial Planning) Rated: AAA

A good chunk of the money being invested in wealth management and banking technology is going toward funding artificial intelligence-driven tools.

But forget the popular concept of conversational, British-voiced computers, chatbots or even cute robot assistants greeting customers at branches; the applications that investors want in on are focused on improving operational efficiency.

The industry’s current methods of handling compliance issues, back-office processing, clearing and settlements, he says, are ripe for reinvention.

Source: Financial Planning

How Does Machine Learning Help Peer to Peer Online Marketplaces Succeed? (Tech Pluto) Rated: AAA

Machine learning technology brings a real ROI to peer to peer marketplace owners. Airbnb, a company known for their personalized approach to each customer has seen a significant growth in the number of bookings after they started using machine learning. Other popular P2P marketplaces such as Etsy, Uber, Lending Club also apply intelligent algorithms to increase their conversion rates and acquire a competitive advantage.

Machine learning helps leading marketplaces and companies that provide AI consulting services develop features that bring tangible value to business and consumers. So how exactly do P2P marketplace companies use this cutting-edge technology? Let’s find out.

Predicting which products a user will like is a widely adopted use case for machine learning. A variety of digital products today have recommender systems powered by this technology. In the past product recommendation systems were based on hard-coded rules. Those rules determined what item to show to a user based on some predefined scenarios. For example, if a user buys a fancy red dress, she’s likely to also buy shoes that match this dress.

SoFi’s Former Head Of Venture Strikes Out On His Own (Benzinga) Rated: A

For this installment, Benzinga interviewed an intriguing fintech venture capitalist: Logan Allin, general partner at Fin Venture Capital and former head of venture at SoFi.

Allin’s career has been largely spent “in and around” financial services, he said, including stints at SoFi, City National Bank and Invesco Ltd. IVZ. He launched Fin Venture Capital in April with a focus on the global fintech sector, greenfield areas and B2B and B2B2C players in particular.

BZ: Fintech funding rounds are getting larger, some consolidation is occurring and the space in general is maturing — is there still room for small startups to have a major impact? What verticals are ripe for disruption?

According to Pitchbook’s data, the U.S. funding environment is skewed increasingly to growth and late stage startups and is on pace to surpass $100 billion in deal value for the first time since the dot-com era.

Indeed, there was $57.5 billion of VC invested in U.S. companies through the first half of the year, and the second quarter of 2018 is higher than six of the past 10 full-year totals. Despite the volume, the deal count has remained stable due to later-stage entry points and larger round sizes, and as a result, deployment is at a slower pace than seen in 2013-2015.

You’re seeing a move toward larger fund sizes with the same investment period as they’ve always had, five years, which leads to larger check requirements per deal and thus a move downstream to growth and late-stage rounds where the valuation math and round sizes align.

Goldman Sachs nears deal to sell its fintech app – WSJ (Reuters) Rated: A

Goldman Sachs is in advanced talks with several financial companies to spin off ‘Simon’, its three-year-old app that sells financial products to retail investors, the Wall Street Journal reported on.wsj.com/2OzaWmf on Wednesday, citing people familiar with the matter.

JPMorgan Chase, Barclays, HSBC Holdings , Credit Suisse, Wells Fargo and insurer Prudential Financial have expressed interest for a stake in the business, the report said.

The deal, which would value the app at around $100 million, is likely to be finalised in the coming weeks.

Lendio Franchising Growth Soars, Doubling Amount of Loans Funded Quarter Over Quarter Since Inception (Lendio) Rated: A

LendingTree Announces Startup Innovators Program at LEND360 (PR Newswire) Rated: A

LendingTree®, the nation’s leading online loan marketplace, today announced it will sponsor a $10,000 award to be given at LEND360 to the fintech startup with the most cutting-edge solutions propelling the online lending ecosystem forward.

As the desire to enter the fintech space continues to heat up, LEND360’s Startup Innovators Program will highlight startup organizations’ crucial part of the fintech ecosystem, bringing new and innovative thinking to the industry.

LEND360 will be held October 8-10, 2018 at the Sheraton Grand Chicago.

iCapital Buys Bank of America Alt Feeder Fund Ops (Wealth Management) Rated: A

Alternative investing platform iCapital Network announced it has entered into a definitive agreement with Bank of America to acquire the bank’s alternative investment feeder fund operations. iCapital expects the volume on its platform to more than quadruple as a result, growing from $6 billion in invested capital across 14,000 underlying accounts to $25 billion across nearly 70,000 accounts.

Bank of America’s Merrill Lynch and U.S. Trust account holders and advisors will continue to use their existing interfaces and their client relationships, but the inner workings of the system will be improved, said Lawrence Calcano, CEO of iCapital.

More Americans With Low Credit Scores Buying Homes (Laredo Morning Times) Rated: A

If you have a low credit score and want to buy a home, your odds of getting a loan have improved. A study by the Fair Isaac Corporation (FICO) shows that credit scores for new mortgage originations have been dropping, suggesting that lenders are slowly relaxing the tight credit policies imposed after the housing crisis.

According to the study, new mortgage loans with credit scores less than 700 increased from 21.9% of all mortgage loans in 2009 to 29.7% in 2017. These include scores in the subprime market that can reach down into the 400s. (While the typical lower credit score limit is 620 for conforming loans and 500 for FHA loans, loans may be granted at even lower credit scores with extenuating circumstances.)

The shift in average credit scores is driven by FHA loans – as expected by the lower acceptance criteria for FHA loans. The latest Origination Insight Report from Ellie Mae shows that only 16.7% of conventional mortgage loan originations in July 2018 were associated with FICO scores less than 700.For FHA loans, over 65% of FHA loans went to borrowers with scores below 700.

2Wheel Partners With Affirm to Offer 0% Financing (Motorcycle & Powersports News) Rated: A

Affirm Inc., a financial technology company, provides transparent alternatives to traditional credit. Customers can select the Affirm payment option at checkout and quickly and easily receive real-time approval of their loan amount. The payment terms are clearly stated with no hidden fees or compounding interest.

5 Surprising Traits of Digital Banking Winners (Financial Brand) Rated: A

Ever since JP Morgan declared itself a technology company that provides financial services — not the other way around — analysts and investors have been scrambling to discern which banking companies are doing tech well, and which are not. They know the institutions that harness the power of artificial intelligence, machine learning and big data, and more importantly, the applied business insights these technologies can generate, will be the banks that will be the winners in the long run.

“Long term I think this will determine the split between winners and losers,” one investor told the Financial Times in a story on AI and banking earlier this year.

New Research Indicates Non-Prime Hispanics Have a Leg up on Financial Health (Market Watch) Rated: A

When it comes to personal finances, Hispanics in the U.S. are more stable and optimistic than other groups studied. A newly released study from Elevate’s Center for the New Middle Class (CNMC) found that non-prime Hispanics – or those with credit scores below 700 – experience higher levels of employment and less volatile monthly income. When compared to the broader non-prime community, non-prime Hispanics in the U.S. are:

  • 65% more likely to plan for major expenses
  • 86% more likely to feel financially stable
  • 38% more likely to save money each month
  • 20% less likely to have had a vacation expense in the last 12 months
  • 23% less likely to spend on routine medical expenses
  • 50% more likely to be able to cover a $1200 unexpected expense
  • 3x more likely to regularly pay using a smartphone
  • 20% less likely to have a credit card
  • 25% less likely to have a personal retirement account
  • 2x more likely to regularly give money to a child or grandchild
  • 40% more likely to be employed

Why those high-profile bank glitches just won’t stop (American Banker) Rated: A

The glitch that left SunTrust customers without access to mobile and online banking for two days is just the latest digital snafu to afflict the banking industry. Upgrades by banks or their vendors that went haywire have resulted in multiple outages this past year.

So it begs the question: If there’s such potential for an upgrade to go wrong, why aren’t banks more prepared for the eventuality, instead of scrambling to get service back up and running?

Industry experts bear some bad news about the state of technology in banking: Banks can’t really be proactive enough to prevent the problems.

Why do state regulators want to limit consumer choice? (American Banker) Rated: A

The decision by the Office of the Comptroller of the Currency to begin accepting applications for special purpose national bank charters from fintech companies promotes innovation, gives consumers and businesses greater choice and creates economic growth and opportunity.

It is also good for America’s dual banking system, which the president of Conference of State Bank Supervisors and the superintendent of the New York Department of Financial Services ignore in their recent articles and statements.

Fed will have the say on key parts of OCC’s fintech charter (American Banker) Rated: A

The Federal Reserve is under increasing pressure to provide clarity on whether nonbank fintech firms that receive a special federal charter will have direct access to central bank lending and to the U.S. payment systems.

The Office of the Comptroller of the Currency confirmed in July that it would accept applications from fintech firms for a “special-purpose” national bank charter, although the new license has been legally challenged by state regulators.

But many experts say the OCC’s charter would lose value if the Fed did not allow direct entry to fintech firms. Those firms now, for example, can access the payments system only through bank partners.

White Oak Healthcare Finance Refinances Texas SNFs for Granite Investment Group (Digital Journal) Rated: B

White Oak Healthcare Finance, LLC (“White Oak”), today announced it acted as sole lender and administrative agent on the funding of a $33.2 million senior credit facility for Granite Investment Group (“Granite”). The funds were used to refinance a portfolio of four skilled nursing facilities in Texas.

Granite Investment Group is a privately held, real estate investment firm focused on multi-family, senior housing, and post-acute care.

AlphaFlow Continues Expansion with Launch of New York Office, Hiring of Fintech Executives Stephan Leccese and John Woodruff (PR Newswire) Rated: B

AlphaFlow, the first automated alternative investment platform for real estate, announced today the opening of a new office in New York City. The office launch and expansion operations will be helmed by recently hired fintech executive Stephan Leccese, who joins the firm as Vice President of Partnerships & Servicing.  John Woodruff, a former credit fund senior analyst, will be joining Stephan in New York, serving as Vice President of Investments.

United Kingdom

Funding Circle to price 71.4 mln IPO shares between 420-530 pence (Nasdaq) Rated: AAA

British peer-to-peer lender Funding Circle plans to sell up to 71.4 million new shares in its initial public offering for between 420 pence and 530 pence per share.

Funding Circle, which expects to list in October with a valuation of more than 1.5 billion pounds ($1.92 billion), said it plans to raise gross proceeds of about 300 million pounds.

Peer-to-peer lender Funding Circle to be valued up to $ 2.4 billion after IPO (CNBC) Rated: AAA

Peer-to-peer lending platform Funding Circle announced the pricing range for its initial public offering (IPO) on Wednesday that could value the company up to around £1.8 billion ($2.4 billion).

The British fintech firm said the price range of the offer has been set at 420 pence to 530 pence per share. The flotation will comprise a maximum of 71.4 million new shares and a secondary component to be determined.

After the completion of the IPO, the issued share capital of the company is expected to comprise between 329.7 million and 345 million shares.

Is real estate crowdfunding the investment option for you? (Born2Invest) Rated: A

Equity crowdfunding has been a great alternative investment for many, but there are other principles that branched out from it. Some investors direct their funds not only on startups that offer unique products or services as others become virtual landlords through property crowdfunding.

Platforms like LendInvest, Landbay and Lendy have risen to make real estate investing more interesting because of higher returns. Some sources suggest that peer-to-peer lending (P2P) schemes like crowdfunding in real estate allow for returns in excess of 5-6 percent compared to traditional real estate investment trusts (REITs).

There are three ways to get into real estate crowdfunding: P2P, debt crowdfunding and virtual buy-to-let.

China

China’s Online Lender Lufax Attracts Potential Investment From Qatar Fund (Gooruf) Rated: AAA

China’s online lender Shanghai Lujiazui International Financial Asset Exchange Co. (Lufax) has attracted a potential investment from sovereign wealth fund Qatar Investment Authority (QIA).

QIA has been negotiating the probable purchase of a minority stake in Lufax with an estimated price range of about US$500 million to US$1 billion, said Bloomberg citing the source.

The company has been aiming to file for an initial public offering in Hong Kong since 2017, but only to witness its flotation on ice because of Beijing’s probes into online lenders.

Fintech / Peer to Peer Lender X Financial Trades on NYSE (Crowdfund Insider) Rated: AAA

Chinese peer to peer lending platform X Financial (NYSE: XYF) completed its initial public offering (IPO) today trading shares on the New York Stock Exchange. Deutsche Bank Securities Inc. and Morgan Stanley & Co. were joint book runners on the IPO.

The IPO saw the Class A ordinary shares priced at $9.50. The offering was for 11 million American Depository Shares (ADSs) thus representing a raise of about $104.5 million. Shares initially traded much higher jumping to over $20/share at one point but are now currently hovering around $13/share.

The underwriters have been granted an option to purchase up to 1,650,000 additional ADSs at the IPO price less the underwriting discount.

X Financial on IPO: We Have Built One of the Strongest Fintech Businesses in China (Crowdfund Insider) Rated: A

Earlier today, China based X Financial (NYSE:FXE) traded on the New York Stock Exchange (NYSE) in its initial public offering raising approximately $104.5 million as 11 million shares were floated at $9.50/share. The shares quickly jumped higher in early trading and eventually closed about 25% higher than the offer price. X Financial, a peer to peer lender and Fintech platform, is part of a growing group of Chinese firms deciding to list their shares on US exchanges. In fact, this was the 9th Chinese company to list on the NYSE this year.

X Financial reports experiencing dramatic growth in the past few years. Top line revenue was approximately USD $270 million for all of 2017. As of the first six months of 2018, the company had already topped this number (USD $279.3) as it appears to be on track to double the year prior total.

Investors Love Chinese Tech Stocks (Bloomberg) Rated: AAA

Peer-to-peer online lender X Financial soared on its first day of New York trading, adding to a string of frenzied U.S. debuts by Chinese technology companies.

Source Bloomberg

Banks give China’s Web lenders a second life (The Business Times) Rated: A

China’s online lenders have found an unlikely lifeline. Investors are fleeing the country’s US$200 billion peer-to-peer (P2P) lending sector as regulators crack down. The funding squeeze has pushed many companies to team up with traditional banks that they once sought to disrupt.

Beijing is reining in the country’s non-bank lending sector. Strict rules, such as caps on loan balances for sites matching small borrowers with individual investors, have shut down hundreds of unruly upstarts. Regulators delayed a June deadline for companies to apply for licences, putting larger groups in legal limbo. New York-listed Yirendai has seen its market value more than halve to US$1 billion since the start of the year.

The stakes are huge. Chinese consumer finance – which includes credit card loans, e-commerce credit, and unsecured personal loans – is on track to top 11 trillion yuan (S$2.2 trillion) by 2020, up from four trillion yuan in 2015, according to Oliver Wyman. But banks prefer to lend to customers with credit histories, which much of the population lacks. They often spurn private corporate borrowers for similar reasons. That has opened the door for P2P operators as well as Web giants like Ant Financial.

Lending hand (Breaking Views) Rated: A

China’s online lenders have found an unlikely lifeline. Investors are fleeing the country’s $200 billion peer-to-peer (P2P) lending sector as regulators crack down. The funding squeeze has pushed many companies to team up with traditional banks that they once sought to disrupt.

Beijing is reining in the country’s non-bank lending sector. Strict rules, such as caps on loan balances for sites matching small borrowers with individual investors, have shut down hundreds of unruly upstarts. Regulators delayed a June deadline for companies to apply for licenses, putting larger groups in legal limbo. New York-listed Yirendai has seen its market value more than halve to $1 billion since the start of the year.

The stakes are huge. Chinese consumer finance – which includes credit card loans, e-commerce credit, and unsecured personal loans – is on track to top 11 trillion yuan ($1.6 trillion) by 2020, up from 4 trillion yuan in 2015, according to Oliver Wyman. But banks prefer to lend to customers with credit histories, which much of the population lacks. They often spurn private corporate borrowers for similar reasons. That has opened the door for P2P operators as well as web giants like Ant Financial.

China Rapid Finance to Participate in DBS Fintech Corporate Day (Acrofan) Rated: B

China Rapid Finance (NYSE: XRF), a leading online consumer finance platform in China, today announced that its Chief Executive Officer Zane Wang will participate in the DBS Fintech Corporate Day, to be held at the Fullerton Hotel in Singapore on Thursday, September 27, 2018.

The Company will also host investor meetings throughout the day.  Attendance at the conference is by invitation only.  Interested investors should contact your DBS sales representative to secure a meeting time.

International

Growth of Investor Numbers on P2P Lending Marketplaces (P2P Banking) Rated: AAA

The disadvantage of showing indexed numbers for growth is that it gives smaller, younger an advantage as their percentage increase of investor base is likely still higher because they come from smaller absolut numbers. An example for this effect is Peerberry where percentage growth of investors is rapid, but the absolute number as of Sep, 1st has reached only 2468 investors as it is a very young marketplace.

Source: P2P Banking

ETHLend Blockchain Crypto Lending Launches New Tech Firm Aave To Induce Innovation (Bitcoin Exchange Guide) Rated: A

Decentralized, peer-to-peer (P2P) financial marketplace, ETHLend has recently revealed the launch of a new tech firm dubbed, Aave. The reason for creating Aave is to induce consumers to come up with innovative ways to expand on “evolving and imaginative technology”. Simply put, the team is working towards bridging the gap centralized players like PayPal and Coinbase have left behind.

Aave will serve as the parent company for ETHLend and the team will remain the same. In other words, the CEO for Aave will be that of ETHLend, Stani Kulechov, Jordan Lazaro will serve as COO, Nolvia Serrano is the CMO, Mika Soyring is the CFO and Ville Valkonen is the CCO.

Australia

Fintech Prospa has now written $ 750 million in loans (Business Insider) Rated: AAA

Fintech Prospa, a lender to small business which in June postponed an ASX-listing after being pinged about unfair loans terms, says it has now written $750 million in loans.

Loans for the year to June were $367 million, a 70% increase on the previous 12 months and 9% higher than prospectus forecasts with strong momentum in the fourth quarter.

For the six months to June 2018, loans hit $211 million, up 16% on prospectus forecasts and up 61% on the previous corresponding period.

MENA

OurCrowd Still on Track to Top USD $ 1 Billion in Investment Crowdfunding (Crowdfund Insider) Rated: AAA

In many ways, OurCrowd epitomizes the aspirations of what investment crowdfunding has the potential to deliver for both issuers and investors. By providing access to quality deals to smaller (accredited) investors, OurCrowd has opened up an asset class previously closed off to all but the very fortunate. On OurCrowd, you can find yourself investing alongside some of the biggest names in venture capital – at the exact same terms – an important distinction. It is also important to note that OurCrowd has skin in the game for each offering it lists on the platform – thus interests are aligned: OurCrowd wants the company to succeed and it also very much wants to see a return on its own investment. These qualities make OurCrowd a compelling option for investors that are willing to shoulder an element of portfolio risk that can also drive some outsized returns.

OurCrowd is based in Israel – where many of its investments are made – but its vision is to empower investors globally and fund companies regardless of geographic borders. This is what you want to see in the digitized, internet fueled Fintech age.

Build a real estate portfolio starting with as little as $ 1000 (AME Info) Rated: A

Real estate crowdfunding comes to Dubai in the form of Smart Crowd

In the US, investors are utilizing crowdfunding sites like Realty Mogul, CrowdStreet, and Fundrise to start and/or build their portfolios, Investopedia notes.

Smart Crowd, an innovative new digital real estate investment platform that supports crowd-funding endeavors in the real estate sector, is trying to fill in a similar role in the region.

Asia

P2P operations launched in Hyderabad (Telangana Today) Rated: AAA

LenDenClub, a peer-to-peer (P2P) lending platform, launched its operations in Hyderabad. It will also expand to other cities later.

LenDenClub chose Hyderabad as the city is a major hub of the IT industry and houses a large number of young professionals, who are among the largest users of digital lending services in the country. It expects 10 per cent of its loan requests originate from Telangana in the next six months.

It is aiming to disburse loans worth Rs 100 crore in 12 months.

European Union

INLOCK Signs MoU with Institutional Lending Provider – Partners with Major CEE Crypto ATM Manufacturer to Test Its Platform (Bitcoin News) Rated: B

INLOCK, a crypto lending platform where licensed lenders can compete for borrowers who want to use their cryptocurrency as collateral for loans, announced today that it has signed a Memorandum of Understanding (MoU) with an institutional lending provider and entered a partnership with one of the Central and Eastern European Countries (CEE) region’s biggest crypto ATM manufacturers to test its Minimum Viable Product (MVP). The company launched the ICO for its ILK token on September 15, the anniversary of the Lehman Brothers collapse.

The CEE region’s crypto ATM manufacturer plans to integrate INLOCK’s services into all of its machines, enabling users to directly take out loans and receive funding in cash within hours. The crypto ATM manufacturer will act as a matching service provider by forwarding customers to INLOCK.

Authors:

George Popescu
Allen Taylor

Mondy July 16 2018, Daily News Digest

market implied inflation

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

market implied inflation

News Comments

United States

United Kingdom

China

Asia

Other

News Summary

United States

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

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

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

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

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

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

Source: Federal Reserve, PeerIQ

Rising US Inflation

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

Measured Inflation vs the Fed’s Inflation Target

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

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

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

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

Source: Lending Club

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

Source: Lending Club

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

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

Source: New York Department of Financial Services

Access the full report here.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

United Kingdom

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

China

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

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

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

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

Source: Bloomberg

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

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

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

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

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

Toutiao Marches into the Fintech Market with Cash Loan Products

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

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

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

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

European Union

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

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

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

India

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

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

Asia

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

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

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

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

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

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

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

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

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

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

MENA

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

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

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

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

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

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

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

Authors:

George Popescu
Allen Taylor

Wednesday December 13 2017, Daily News Digest

Wednesday December 13 2017, Daily News Digest

News Comments Today’s main news: Court dismisses case against OCC Fintech Charter. Affirm’s valuation confirmed at $1.75B. RateSetter Australia reaches $200M milestone. SoftBank invests $450M into Compass. Starling Bank expected to profit in 2019. Linked Finance launches P2P lending pension accounts. ID Finance raises $85M through ETF bonds. Today’s main analysis: TransUnion reports on consumer credit markets. Today’s thought-provoking articles: What […]

Wednesday December 13 2017, Daily News Digest

News Comments

United States

United Kingdom

China

European Union

International

Australia

India

Asia

MENA

Israel

South America

News Summary

United States

Court throws out New York regulator’s suit against OCC fintech charter (American Banker), Rated: AAA

A New York District Court judge threw out a lawsuit by the New York Department of Financial Services that sought to block the Office of the Comptroller of the Currency’s attempted fintech charter, saying the charter doesn’t exist yet so the suit is premature.

Lending startup Affirm valued at $ 1.8 bln in latest financing round (Business Insider), Rated: AAA

Silicon Valley lending startup Affirm said on Monday it has raised $200 million in a fresh round of funding, boosting prospects as the firm aims to go after the market for millennial shoppers needing loans.

The new financing put Affirm’s total fundraising to date at about $450 million, and increases its valuation to $1.75 billion, according to a source with knowledge of the matter.

Max Levchin On What Comes After $ 200M Worth Of Capital Affirmation (PYMNTS), Rated: AAA

The CEO with the measured response is PayPal co-founder Max Levchin, who told Karen Webster that with any capital raise of size, the temptation is to believe that “it is a big victory and it is validation … but all it really is, is a temporary tally of how far you have gone.”

He noted that with big investments come big responsibility (and Affirm has raised roughly $450 million to date), as he remarked that there is the implicit end goal of taking the money and parlaying vision and strategy into strong returns on that cash.

Affirm says that its retailers report that consumers who use Affirm leave with a basket size 75 percent greater than those who don’t use Affirm to pay for their purchases, and enjoy site-wide conversion rates as much as 20 percent higher, with revenue per visitor lifts of more than 10 percent.

Doing customers wrong allows your competitor to make things right (American Banker), Rated: A

Consider Affirm, a startup that offers consumers installment loans for individual purchases and markets the loans as a simpler and more honest financing alternative — a message that is clearly targeted at consumers who are frustrated by a perceived lack of transparency in the costs associated with using credit cards. This message appears to be resonating in the market; Affirm is processing relationships with more than 1,000 internet retailers and is reportedly working with Walmart on a pilot project.

In an interview with American Banker, Douugh founder and CEO Andy Taylor said: “When we dug deeper, we realized the consumer debt levels are out of control. Big banks are running off legacy business models that are driven to keep customers within these debt cycles. They’re not properly incentivized to foster financial wellness.”

Affirm, Marcus and Douugh are all basing their strategic direction on a simple but powerful insight: There is a difference between the way many consumers use credit cards and the way that those consumers should use their credit cards in order to maximize their financial wellness.

Retailers now offers Instaloans to pay for purchases (ABC30.com), Rated: A

A growing number of major retailers offer shoppers instant loans to pay for your purchases.

But how do they work? And are they better than credit cards?

Each lender may be slightly different, but typically: you give basic information, decide the length of the loan -usually anywhere from three to twenty-four months and in less than a minute you’ll know if you’re approved.

Prosper Appoints Former J.P. Morgan Chase CMO Claire Huang to Board of Directors (Crowfund Insider), Rated: AAA

Peer-to-peer lending platform Prosper announced on Tuesday it has appointed former Chief Marketing Officer of J.P. Morgan, Claire Huang to its board of directors. According to Prosper, Huang has held senior leadership positions at various well-known financial services companies, which includes Bank of America, Fidelity Investments, and American Express.

OnDeck Adds Former GE Capital and SunTrust Executives to Finance Team (PR Newswire), Rated: AAA

OnDeck (NYSE: ONDK), the leading online lender to small business, today announced the hiring of two senior financial services executives to join its management team. Kelly Merrill and Erich Wust will assume new leadership roles that directly support OnDeck’s mission of empowering small business owners with the fastest and most flexible credit solutions.

Kelly Merrill joins OnDeck as the Senior Vice President for Finance, where she will help lead the company’s short-term and long-term financial planning initiatives. Merrill brings over a decade of finance experience to OnDeck from GE Capital, where she played a leading role in developing and executing the disposition strategy for GE Capitals’s $200 billion balance sheet.  Previously, Merrill was the Chief Financial Officer (CFO) of GE Capital Real Estate, where she led a team of more than 50 employees.

Erich Wust has been appointed as the Senior Vice President for Portfolio Management at OnDeck. He will be responsible for managing portfolio credit strategies, balance sheet optimization and other components of the company’s loan portfolio. Wust joins OnDeck after more than a decade in credit and risk leadership roles at SunTrust Bank.

Compass gets $ 450M from SoftBank; real estate portal now valued at .2B (TechCrunch), Rated: AAA

Less than a month after raising $100 million led by Fidelity, real-estate startup Compass is striking while the iron is hot. The company has now picked up an even bigger investment of $450 million, this time from the SoftBank Vision Fund, plus another $50M in secondary deals, to fill out a vision of its own: taking its real estate rental and sales platform global.

New York-based Compass is now valued at $2.2 billion post-money, up from $1.8 billion just four weeks ago, with $775 million raised to date.

Consumer Credit Market Expected to Remain Strong in 2018 Even in a Rising Rate Environment (NASDAQ), Rated: AAA

In spite of rising interest rates, the U.S. consumer credit market is poised to perform well in 2018, with well-managed delinquencies and continued wide access to credit across all products. TransUnion’s (NYSE:TRU2018 consumer credit forecast found that expected increases to GDP, personal income, total employment and the Housing Price Index, among other factors, will outweigh potential negatives such as increasing interest rates and slowing vehicle sales.

5-Year Trends: Serious Borrower-Level Delinquency Rates for Key Credit Products**
Credit Product Q4 2013 Q4 2014 Q4 2015 Q4 2016 Q4 2017* Q4 2018* PCT Change in Last 5 Years (2013-2018)
Auto Loans  

1.23

%  

1.19

%  

1.27

%  

1.44

%  

1.43

%  

1.46

%  

+18.7 %

Credit Cards 1.60 % 1.48 % 1.59 % 1.79 % 1.86 % 1.96 % +22.50 %
Mortgage Loans 4.31 % 3.40 % 2.46 % 2.28 % 1.83 % 1.65 % (-61.7%)
Unsecured Personal Loans 4.01 % 3.73 % 3.62 % 3.83 % 3.37 % 3.36 % (-16.21%)
*Projections; **Serious mortgage, auto loan and personal loan delinquencies are defined here as those with payments 60 or more days past due. Serious credit card delinquencies are defined as those with payments 90 or more days past due. 

Inside the Mortgage Forecast

60-Day+ Mortgage Delinquency Rate and Average Mortgage Debt per Borrower
Q4 2009 Q4 2010 Q4 2011 Q4 2012 Q4 2013 Q4 2014 Q4 2015 Q4 2016 Q4 2017* Q4 2018*
7.16% 6.65% 6.15% 5.38% 4.31% 3.40% 2.46% 2.28% 1.83% 1.65%
$190,324 $186,488 $185,594 $184,753 $187,228 $187,311 $189,914 $194,415 $200,935 $205,534
*Q4 2017 and Q4 2018 include projections

Inside the Credit Card Forecast

90-Day+ Credit Card Loan Delinquency Rate and Average Credit Card Loan Debt per Borrower
Q4 2009 Q4 2010 Q4 2011 Q4 2012 Q4 2013 Q4 2014 Q4 2015 Q4 2016 Q4 2017* Q4 2018*
2.97% 2.17% 1.90% 1.75% 1.60% 1.48% 1.59% 1.79% 1.86% 1.96%
$6,043 $5,609 $5,485 $5,371 $5,324 $5,329 $5,337 $5,486 $5,626 $5,675
*Q4 2017 and Q4 2018 include projections

Inside the Auto Finance Forecast

60-Day+ Auto Loan Delinquency Rate and Average Auto Loan Debt per Borrower
Q4 2009 Q4 2010 Q4 2011 Q4 2012 Q4 2013 Q4 2014 Q4 2015 Q4 2016 Q4 2017* Q4 2018*
1.59% 1.27% 1.11% 1.15% 1.23% 1.19% 1.27% 1.44% 1.43% 1.46%
$14,922 $15,031 $15,377 $16,061 $16,781 $17,456 $18,004 $18,391 $18,588 $18,694
*Q4 2017 and Q4 2018 include projections

Inside the Personal Loan Forecast

60-Day+ Personal Loan Delinquency Rate and Average Personal Loan Debt per Borrower
Q4 2009 Q4 2010 Q4 2011 Q4 2012 Q4 2013 Q4 2014 Q4 2015 Q4 2016 Q4 2017* Q4 2018*
4.98% 4.78% 4.20% 3.93% 4.01% 3.73% 3.62% 3.83% 3.37% 3.36%
$6,650 $6,138 $5,895 $5,904 $6,247 $6,741 $7,360 $7,640 $8,066 $8,461
*Q4 2017 and Q4 2018 include projections

Why JPMorgan, Amex, HSBC are backing ‘isolation’ web browsing (American Banker), Rated: AAA

Often users are tricked by phishing emails that mimic a legitimate note from the boss or a senior corporate leader. And the links and sites can look secure. According to PhishLabs, nearly 25% of all phishing sites in the third quarter were hosted on HTTPS domains — almost double the rate of the previous quarter.

As part of their effort to deflect these attacks, some banks are turning to isolated browsing, or remote browsing, technology. Such systems force all internet activity to happen in a protected space on the cloud, preventing malicious code from reaching a company’s network. The technology is not brand new, but it is starting to gain traction as some large banks have finished their testing of it and are going public with their use of it.

JPMorgan Chase, American Express and HSBC announced Monday that they are leading a $40 million round of funding in the isolation-tech provider Menlo Security, bringing its total funding to $85 million.

Source: American Banker

 

Niche lending and fintech cross paths in Silicon Slopes (Utah Business), Rated: A

There are, however, entire demographics not serviced by tried-and-true lending institutions. Often, these folks’ credit score fails to meet a bank’s minimum standards. Or they need unconventional terms on an equipment or business loan. Whatever the reason, these transactionally marginalized sectors find themselves at the mercy of high-interest lenders. Or with no access to capital at all.

“There is a significant population of U.S. consumers who can’t get a loan,” notes Nate Heward, CFO at Acima Credit, a company that provides a point-of-sale credit platform.

Capitalism abhors a void

From the ubiquitous strip mall payday lender to the world of microfinance, a plethora of entrepreneurial solutions has emerged to get cash in the hands of would-be borrowers cut off from other avenues. These alternative lending practices have various degrees of reputability; a wide spectrum exists between the purely predatory lending shop, on the one hand, and the creative value-adding venture, on the other.

Scratching the consumer itch

In practical terms, Acima asks four simple questions of the would-be borrower:

  1. Do you have a three-month history with your current employer or source of income?
  2. Do you deposit $1,000 or more into your checking account each month?
  3. Have you had a checking account for at least 90 days?
  4. Is your checking account free from NSFs, excessive overdrafts and negative balances?

It’s all fintech

The companies profiled in this article may not be considered fintech firms per se; they’re not using technology to create a new financial paradigm a la Paypal, Indiegogo or Coinbase. They’re merely offering tried-and-true solutions to untapped consumer markets. Viewed from another angle, however, they’re fintech companies through and through. Acima, Progressive, et al are racing to deliver the most convenient financial solutions to the most people in their target customer base. And to do so, they’re relying on technology all the way.

Finance teams are ‘bottlenecking’ banks’ digital transformations (Tearsheet), Rated: A

Banks are working hard to beef up their technology and innovation teamsembrace agile developmentand move to acting like digital companies, but bank finance departments still do a lot of manual work and will start to hold their companies back from becoming digital entities. Finance teams are the control functions and scorekeepers of an organization, but if they can’t process data at the same speed as the rest of the organization they could slow down the speed of company mergers or product rollouts when competing transactions are already taking place.

Royal Business Bank Invests $ 500K in Lendistry Loan Fund, Providing Opportunity for Small Businesses in Underserved Communities (Digital Journal), Rated: A

Royal Business Bank, a wholly-owned subsidiary of RBB Bancorp, has made a $500K commitment to the Lendistry CRA Loan Fund I. Launched at a time when most banks were struggling, Royal Business Bank has been successfully serving the Asian-American community since 2008. While specializing in businesses engaging in trade with Pacific Rim countries, the bank also offers small business loans and residential mortgages.

First financial industry brief filed in CFPB English v. Trump case (Ballard Spahr Email), Rated: A

This afternoon (LT Editor: December 12,2017) the Credit Union National Association (CUNA), represented by Ballard Spahr’s Alan Kaplinsky, filed the first amicus brief from the financial industry in the English v. Trump litigation over who will succeed Richard Cordray as the head of the Consumer Financial Protection Bureau. CUNA supports the President’s authority to appoint an acting director.

Lawsuit: Trump appointee Mick Mulvaney has ‘no more right’ to lead CFPB ‘than Santa’ (Washington Examiner), Rated: A

A new federal lawsuit says President Trump’s “plainly illegal” appointment of Mick Mulvaney to be acting director of the Consumer Financial Protection Bureau must be reversed in favor of Leandra English, who also claims the title.

Ilann Maazel, an attorney for the Lower East Side People’s Federal Credit Union, told the Washington Examiner that the credit union is suing because of the feared effect of Mulvaney policies.

The legal dispute centers on whether the 2010 Dodd-Frank financial reform, which set up the CFPB, makes the deputy director the acting director if there’s a vacancy, or whether the older Federal Vacancies Reform Act gives the president that power.

US Bank sees success with Zelle (Business Insider), Rated: A

US Bank integrated Zelle — which has over 30 other banking partners like Bank of America (BofA), JPMorgan Chase, and Citi — last year. The bank saw a 104% increase in Zelle transactions in the past four months, and a 50% increase in customer enrollment in the P2P offering during that time.

Source: Business Insider

To compete with big tech firms, banks need big-tech talent (American Banker), Rated: A

Nine years ago, D.J. Patil and Jeff Hammerbacher coined the term “data scientist.” Four years later, Patil and Thomas Davenport deemed the profession “the sexiest job of the 21st century” in the pages of Harvard Business Review.

For banks, this imbalance is particularly challenging at a time when the industry is increasingly vying for the same talent the tech giants are aggressively courting. To stay competitive, the financial services industry must defend against a new cast of competitors by changing how it attracts, hires and develops data science talent.

 

BitGo Raises $ 42.5M in Series B Funding (Finsmes), Rated: A

BitGo, a Palo Alto, CA-based company which makes digital currencies usable for businesses in a regulated economy, raised $42.5m in Series B financing.

The company intends to use the funds to accelerate enabling businesses to integrate digital currencies into their existing financial systems.

AI 100: The Artificial Intelligence Startups Redefining Industries (CB Insights), Rated: A

Source: CB Insights

5 Promising Early-Stage Startups to Watch (Tech Startups), Rated: B

Throtle is a 2nd generation data onboarding company focused on deterministic matching, identity resolution and closed loop enablement, powering brands and companies with their omnichannel marketing efforts.

Affirm is a San Francisco-based financial service startup that offers installment loans to consumers at the point of sale. Its aim is to improve the banking industry to be more accountable and accessible to consumers.

Homebuying With Alternative Credit (Microbilt), Rated: B

Source: Microbilt
United Kingdom

Digital challenger Starling to hit profit in 2019 says founder Anne Boden as European expansion takes crucial step (City A.M.), Rated: AAA

Digital-only challenger bank Starling will “definitely” be in profit by the end of 2019, its chief executive told City A.M., as it announced a major step in its plans for European expansion.

The bank will today announce it has become a direct member of the single euro payments area (Sepa), which allows credit transfers, direct debit and card payments in euros across the whole of the EU.

Crowdfunding a mission to save capitalism from itself (Financial Times), Rated: AAA

Jeff Lynn is on a mission to save capitalism from itself at a time when millions feel locked out, and unable to foresee themselves better off than their parents. His answer: to democratise capital.

That is one reason he founded Seedrs, an online platform through which individual investors can buy shares in high-growth companies at an early stage — a privilege once reserved for institutions and private equity funds. The other reason was to make money.

Seedrs, which along with Crowdcube dominates the UK market, has funded more than 540 deals, representing £280m of investment. Some were follow-on rounds, and in total about 400 companies have been funded. About 20-30 companies are live on the site at any time.

Crowdfunding by numbers

Critics say a big difference between crowdfunding and the stock market is liquidity — you cannot just sell your stake. But Seedrs has begun a secondary market and says it has had several exits already.

Free Agent, a Scottish maker of accounting software, floated in November 2016 at 87p. Its shares remain below the 100p Seedrs investors paid, though some sold when it hit 140p this year. Chapel Down, a vineyard, was already quoted on the Nex exchange (formerly ISDX) when it raised money at 28p a share in October 2014. It has been trading around three times that level.

China

SenseTime Raises US$ 410M Series B Financing (Finsmes), Rated: A

SenseTime, a Chinese artificial intelligence company focused on computer vision and deep learning technologies, raised US$410m series B1 B round of financing.

SenseTime has powered many industries such as finance, security, smart phone, mobile Internet, robotics, and automobile with core computer vision technologies including face recognition, video analysis, character recognition, and autonomous driving.

European Union

Linked Finance Launches New P2P Lending Pension Accounts (Better Business), Rated: AAA

Irish peer-to-peer lending company Linked Finance has launched a new type of account that allows holders of self-administered pensions to make P2P lending to Irish SMEs part of their pension investment portfolio.

With net returns of between 7 and 8.5 per cent, 24/7 online account access, complete control of lending activity, and monthly repayments of principal & interest, P2P lending is becoming an attractive asset class for a growing number of investors.

Mobile bank N26 partners with crowd-lending platform Younited Credit in France (Telecompaper), Rated: A

European start-up N26 has expanded the range of its banking services on offer in the French market via a partnership with Younited Credit, a fintech start-up specialising in short-term loans and crowd-lending.

The Advantages of #Peer-to-Peer Lending (EU Reporter), Rated: A

For many years, if someone wanted a loan, they would have to apply for one through a bank. Before they received that loan, the bank investigated their credit and decided what the rate of interest would be applicable.

However, there is another way to get a loan without worrying about a low credit score or high interest rates. This is peer-to-peer lending or P2P. Through peer-to-peer lending platforms, individuals can invest their money in other individuals, with an interest rate that the two groups have agreed is fair.

Hungarian fintech secures EUR 6 mln in Czech funding (Portfolio.hu), Rated: A

The investor will first acquire a 20% stake in Barion, which is active in online and mobile payments, for EUR 2 mln.

Finnish Crowdfunding & P2P Lending Platform Fellow Finance Receives Payment Institution Authorization (Crowdfund Insider), Rated: B

Finnish crowdfunding and peer-to-peer lending platform Fellow Finance announced on Tuesday it received payment institution authorization from the Financial Supervisory Authority of Finland. The online lender claims it is the first funding platform to receive this type of authorization, which will notably enable Fellow Finance to provide new services to its consumer and corporate customers, to expand its services further in Europe and to utilize the new payment service directive (PSD2) in the development of Fellow Finance service.

With Norrsken House, ex-Klarna executive envisions a global network of co-working spaces focused on impact (TechCrunch), Rated: A

He launched the Norrsken Foundation later that year with about $20 million of his own money. By early 2017, the first fruits of that funding took shape with the opening of Norrsken House, a co-working space in Adalberth’s hometown of Stockholm dedicated to companies that are developing technologies that have a social impact.

Now, Adalberth has committed an additional $62 million of his own money to expand that vision. The goal, he said, is to eventually create a network of 25 impact-focused co-working spaces and foundation hubs around the globe in the next 10 years. The first Norrsken House has 112 companies in it and seven have received direct investment from the Norrsken Foundation’s fund (more on that in a bit).

International

ID Finance raises $ 8.5m via exchange-traded bonds to support growth (Finextra), Rated: AAA

ID Finance, the emerging markets fintech company, today announced successful completion of its first issuance of exchange-traded bonds.

The company raised $8.5m from the bond registered in Russia and listed on the Moscow Exchange. It was the first tranche of a $170m bond issuance programme that the company plans to support global expansion.
The bond, which was oversubscribed, has a maturity period of three years and a quarterly coupon payment frequency.

Banks, fintechs and a Brit royal to build green-lending blockchain (American Banker), Rated: A

Could fintech help the planet cope with climate change?

Some major players — Prince Charles; bankers from Barclays, Standard Chartered, and BNP Paribas; three fintechs; and professors from the University of Cambridge — all hope the answer is yes.

On Tuesday at the One Planet Summit in Paris, they are expected to announce they are developing blockchain technology that lets banks see which potential borrowers use environmentally sustainable practices and therefore are worthy of preferential lending terms. Such disclosures presumably would put pressure on companies to pollute less.

Australia

RateSetter’s Australian business hits $ 200m milestone (AltFi), Rated: AAA

RateSetter Australia has hit the AUD$200m mark in lending a little over three years removed from launching down under. The platform, which lends to both businesses and individuals, has doubled its lending volumes over the past six months.

Interestingly, 56 per cent of its investors withdrew money from bank savings accounts in order to divert them into the platform, while a further 17 per cent reallocated money from bank term deposits. The greatest proportion of the platform’s investors are millennials, at 58 per cent, although they invest the least amount of money on average of any age group at $9,454. Retirees (aged 65 and over) by contrast invest an average of $66,118.

India

Understanding the Data Protection White Paper Part XI: Establishing proper deterrent consequences for privacy violations (Tech 2), Rated: AAA

This article is Part 11 of a multi-part series explaining the recently issued white paper on data protection in India. You can read Part 1Part 2, Part 3Part 4Part 5Part 6Part 7Part 8Part 9 and Part 10.

Consider also the case of Sitesearch in the US, where the company bought payday loan applications and sold them to third parties, which included fraudsters, who used the data to steal more than $25 million from user accounts. Such careless buying and selling off of data should not be justifiable in the name of consent. While safeguards such as requiring that companies transfer data to only to companies with a comparable level of privacy provisions help, these must be backed up by huge penalties for violations.

For example, consider the Equifax data breach, the breach of a credit information company, leading to the loss of crucial data of over 143 million Americans. This breach was the result of a vulnerability in their web application software, a vulnerability that was discovered and for which a patch had been issued at least 2 months before the actual hack. The breach of this crucial data was thus the result of negligent, or non-implementation of the patch.

A landmark privacy judgment in India is the Canara Bank case, which struck down a provision in a law, which allowed the authorisation of ‘anyone’ to conduct investigations and demand the production and seizure of documents, including bank documents. Such a wide delegation of powers can allow any and everyone, even unscrupulous actors, permission to gain access to confidential data, which should not be allowed.

This case draws attention to an important aspect of data protection — it must be ensured that investigations, at all times, must be authorised, and by authorised personnel only. Any violations, or even exceeding of powers must be punishable.

Asia

8Percent leverages power of platform (Korea Herald), Rated: A

Companies that have used the 8Percent platform include Korea’s leading vehicle-sharing app operator Socar, solar energy firm S-Power and restaurant chains Power Plant and The Booth.

For example, a P2P investor into Socar was given a 1-hour free-driving offer each month for a year, until the loan matured. The offer was part of a return to about 600 retail investors, who lent a combined 1.3 billion won ($1.19 million) to the car-sharing firm in July 2015.

Vouchers for restaurants, such as Power Plant and The Booth, were given as rewards to investors.

According to a December estimate by 8Percent, three-fourths of investors, who offered an accumulated 97.7 billion won in loans, were from metropolitan areas — either Seoul or Gyeonggi Province — while those in their 20s or 30s accounted for over three-fourths of investors. The investors, without tax being deducted, are offered on average 9.78 percent interest for investments.

Some 65 percent of its borrowers — about 5,000 – had a credit rating between 4 and 6 on the scale of 1 to 10.

MENA

Crowdfunding real estate: a new reality booming? (Gulf News), Rated: AAA

Similarly, online REITs use online platforms and digital technology to enable wider access to REITs and quicker dissemination of REIT information. This allows mass participation and broader wealth distribution.

The ticket size to crowdfund a $1-billion airport is not exactly for everyone. However, a three-bedroom apartment in Mumbai, Manchester or Dubai Marina jointly owned by a hundred individuals sounds realistic. It also helps diversify risks for investors.

Smart Crowd is a crowdfunding platform, very different from an online REIT. The company believes it can enable anyone with Dh5,000 in savings to enter the Dubai property ladder. Its platform is awaiting final regulatory approval from the Dubai Financial Services.

Israel

MK Rachel Azaria threatens banks with P2P legislation (Globes.co.il), Rated: AAA

MK Rachel Azaria, chair of the Knesset Reforms Committee (officially known as the Special Committee on the Planning and Building Bill and the Maternity Leave and Parenting Bill) did not like the draft circular released by the Bank of Israel on regulating the relationship between the banks and the digital peer-to-peer (P2P) lending platforms on Sunday.

Azaria is now threatening to promote legislation that will regulate relations between the banks and the platforms, but this appears to be designed to pressure the Bank of Israel to publish new, more focused guidelines .

South America

Creditas Raises $ 50M in Series C Funding (Finsmes), Rated: A

Creditas, a Sao Paulo, Brazil-based digital secured loan platform provider, raised $50m in Series C funding.

Authors:

George Popescu
Allen Taylor