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March 3rd 2016 Daily News Digest Lending Times

Potential reasons behind Lending Club’s shares fall: fraud in China, Santander, lawsuits, rise in rates and risk.
Issues with marketplace loan data reporting to credit bureaus.
Ratesetter offered much more lending data on their website starting Jan 2016.
OneMain, brick and mortar lender since 1920, is going digital and leveraging their data.
And Klarna’s smooth the fish ad.

March 3rd 2016
Title Description Interest level Publication
What Lending Club’s falling share price means for the P2P lending sector The share price fall has many causes that exist far from the company’s performance indices. The reasons advanced are : Fraud in China. Santander left Lending Club. Legal companies started their investigation against LC. Rise in interest rates on some loan grades and risk rising. AAA Tech Crunch
Reporting Marketplace Loan Data to Bureaus No Easy Task To be clear, there is no requirement in regulations implementing both the Fair Credit Reporting Act and the Equal Credit Opportunity Act that marketplace lenders — or any other type of lender — report loan performance data to CRAs. One option for newer lenders interested in reporting credit data is to take the interim step of reporting loan performance only for loans that default and only after they default. It is not clear whether this will satisfy the call for more reporting by the credit bureaus. AAA American Banker
It’s lenders all the way down In early January, one of the UK’s big three “peer-to-peer” lenders, Ratesetter, began publishing more detailed data on where its loans are going. Ratesetter’s publicly available loan book, which you can download from their website if you register for an account, currently has historical data from the company’s founding in 2010 to the end of January this year. Transparency and simplicity are supposed to be two of the benefits of peer-to-peer lending. Ratesetter may have the first, but as time passes it has less and less of the second. AAA FT Alphaville
Loans still open for UK BTL investors before stamp duty rise LendInvest says the applications for loans to finance purchases could complete before the 3% Stamp Duty Land Tax increase comes into effect for landlords and developers on 1 April. A Opp Today
What the heck is… an Innovative Finance ISA? Last July Chancellor George Osborne revealed a new initiative to include peer-to-peer lending under the existing tax-free Individual Savings Account (ISA) scheme. George Osborne During the last Budget Osborne revealed that peer-to-peer lending would be covered by your existing ISA tax-free allowance. The change means that from 6 April you’ll be able to invest up to £15,240 a year onto platforms like Funding Circle, RateSetter or Zopa. A The Memo
Ad of the Day: Are These the Strangest, Most Mesmerizing Financial Ads Ever? Strange and mesmerizing ad capaing for Klarna. To communicate this idea of "smoooth," the ads show, respectively, a fish taking a thrilling ride down a plastic slide and across a floor; a cheese slicer carving gorgeously through a long block of cheese; and a very hairy creature swimming carefree through a pool. A Ad Week
EQUITY ALERT: Rosen Law Firm Announces Filing of Securities Class Action Lawsuit Against LendingClub Corporation – LC Yet another law firm filling a Securities Class Action Lawsuit vs LC. The price of being public and seeing share price reduce significantly. B Business Wire
Subprime Lender OneMain Using New Tools to Mine Old Data OneMain previously known as Springleaf has borrower data going back to 1920 !!! OneMain mines "alternative" data as part of the mix to determine creditworthiness, along with traditional credit scoring. The company has 1,800 branches in 43 states. The company, which has $6.4 billion in net receivables. OneMain said the tools have helped it maintain customer-acquisition costs amid rising competition from newer startup entrants into the market, improve customer conversion rates and keep loan-loss rates in the 5% to 6% range. AAA American Banker
Former Westpac banker Jason Yetton to head up peer-to-peer lender SocietyOne Former senior Westpac banker Jason Yetton will join SocietyOne as chief executive in the next few months as the peer-to-peer lender continues on a growth path that could ultimately lead to an initial public offering. B The Australian Business Review
Should you use your Isa for peer-to-peer lending? In order for investors to spread their P2P Isa investment across multiple platforms, a third party asset manager (such as Bestinvest or Hargreaves Lansdown) would need to become an Isa manager, and this has not yet happened. A nascent industry, the biggest criticism of P2P lending is that it has yet to experience a financial downturn. A Financial Times
Hong Kong Proposes Improvements to Boost Fintech Development The Steering Committee believes a clearer vision is necessary to underline Hong Kong’s commitment to Fintech. They advocate the creation of a one-stop office to support startups. Taking a page from the UK, officials believe a point of contact for Fintech regulations must be created to allow startups to better understand the regulatory landscape. Funding for early stage Fintech firms is always an important topic. The Steering Committee notes that the government’s Innovation and Technology Fund (ITF) has provided over HK$10 billion to more than 5000 projects since 1999. Private sector funding for Fintech firms is said to have been “notable”. Quoting AngelList data, the document states that 18 companies raised USD $140 million since 2011. A Crowdfund Insider
CFPB Fines Fintech Firm Dwolla Over Data-Security Practices $100,000 fine. The Consumer Financial Protection Bureau put companies in the fast-growing online-payment sector on notice with an enforcement action against a financial-technology startup for allegedly misrepresenting how it protected customers’ data. A The Wall Street Journal

 

Author: George Popescu

About the author

George Popescu

Serial entrepreneur.

George sold and exited his most successful company, Boston Technologies (BT) group, in 2014. BT was a technology, market maker, high-frequency trading and inter-broker broker-dealer in the FX Spot, precious metals and CFDs space company. George was the Founder and CEO and he boot-strapped from $0 to a $20+ million in revenue without any equity investment. BT has been #1 fastest growing company in Boston in 2011 according to the Boston Business Journal and the only company being in top 10 fastest in 2012-13 as it was #5 in 2012. BT has been on the Inc. 500/5000 list of fastest growing companies in the US for 4 years in a row ( #143, #373, #897 and #1270). After the company sale in July 2014 until February 2015 George was Head-of-Strategy for Currency Mountain ( www.currencymountain.com ), a USD 100 million+ holding company focused on retail and medium institutional currencies, precious metals, stocks, fixed income and commodities businesses.

• Over the last 10 years, George founded 10 companies in online lending, craft beer brewery, exotic sports car rental space, hedge funds, peer-reviewed scientific journal ( Journal of Cellular and Molecular medicine…) and more. George advised 30+ early stage start-ups in different fields. George was also a mentor at MIT’s Venture Mentoring Services and Techstar Fintech in NY.

• Previously George obtained 3 Master's Degrees: a Master's of Science from MIT working on 3D printing, a Master’s in Electrical Engineering and Computer Science from Supelec, France and a Master's in Nanosciences from Paris XI University. Previously he worked as a visiting scientist at MIT in Bio-engineering for 2 years. George had 3 undergrad majors: Maths, Physics and Chemistry. His scientific career led to about 10 publications and patents.

• On the business side, Boston Business Journal has named me in the top 40 under 40 in 2012 in recognition of his business achievements.

• George is originally from Romania and grew up in Paris, France.

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