- Today’s main news: Kabbage sued over true lender doctrine. Orchard to launch online lending industry page on Bloomberg terminal. KBRA assigns preliminary ratings to SoFi Consumer Loan Program 2017-6. DBRS assigns provisional ratings to SoFi Consumer Loan Program 2017-6. RateSetter changes approach to property loan defaults. Lendy breaks another record. MarketInvoice enters business loan market.
- Today’s main analysis: FT Partners’ CEO alternative lending market analysis. International P2P lending volumes for October 2017.
- Today’s thought-provoking articles: Fintech lenders take larger share of personal loan market. The profits and perils of P2P lending. Chinese banks create more profits than BAT. Lendio lends thousands to Kiva borrowers. The IMF on cross-border payments. SME failure rate to spike unless funding issue is addressed in South Africa.
- Kabbage sued by small business borrower. AT: “Lawsuits will continue to be a thorn in the side of alternative lenders until the true lender debate is resolved.”
- Orchard to launch industry page on Bloomberg.
- KBRA assigns preliminary ratings to SoFi Consumer Loan Program 2017-6.
- DBRS assigns provisional ratings to SoFi Consumer Loan Program 2017-6.
- Fintech lenders take larger share of personal loan market, increase risk-return performance. AT: “A TransUnion study shows that fintech lenders have gained an additional 2% of market share since 2016. Way to go!”
- FT Partners’ CEO monthly alternative lending market analysis. AT: “As usual, a must-read.”
- 6th Avenue Capital gets $60M merchant cash commitment. AT: “Congratulations.”
- CFPB data-sharing success depends on how guidance is enforced.
- Elevate Credit announces Q3 results.
- Robinhood launches Spotify-like web platform.
- LendingTree releases top customer-rated lenders by loan product for Q3.
- Online lenders shrug off scandals to increase market share.
- R3 takes on Ripple with cross-border payments on the blockchain.
- What type of data is fair in credit models?
- Foundation Capital leads CoverWallet Series B round.
- Affirm releases app on Apple, Android.
- Patch of Land gets new CEO.
- Remitly raises $115M.
- CityVest enters real estate crowdfunding.
- Where do home buyers want to move to and from?
- Real estate investing for techies.
- How SoFi grew key metric by 100 times. AT: “An excellent interview with former VP of marketing.”
- Payday lending rates could drop from 600% to 28%.
- Free webinar on small-dollar lending.
- Elevate CEO to speak at Techweek Conference in Dallas.
- Navient deal coul endanger student loan borrowers, says Warren.
- BrightPlan launches hybrid robo.
- Avant wants to replace loan officers with robots.
- Attune hires new execs.
- RateSetter changes approach to property loan defaults.
- Lendy breaks new monthly loan repayment record.
- MarketInvoice takes on big banks with business loans.
- Citigroup bets on LendInvest.
- Citi provides warehouse facility for LendInvest.
- The perils, profits of P2P lending.
- Lenders must help brokers meet specialist challenge.
- Fintech lenders take market share from high street banks.
- Small businesses bank on alt finance.
- HSBC plans to offer robo-advice.
- Landbay, Buy to Let Club complete Southgate building lend.
- MarketInvoice to offer business loans.
- The benefits of passive and active P2P investing.
- Funding Circle, RateSetter named to LinkedIn’s top 25 companies list.
- Assetz continues to profit.
- Atom Bank named to LinkedIn’s list of top 25 startups.
- Asos offers pay later option with Klarna.
- Sancus gets a new managing director.
- Chinese banks create more profits than BAT.
- Senmiao Technology files $20M IPO.
- Handing Yuyou transfers shares of Wei Dai Network.
- Mintos scraps secondary market fees.
- Telecom giant Orange gets into lending.
- The future of P2P lending. AT: “Infographic.”
- Lendio supports Kiva borrowers.
- International P2P lending volumes for October.
- The IMF on cross-border payments.
- Alternative assets to double by 2025.
- Zelle adds major tech partners.
- Regulating P2P lending.
- State Bank of India partners with Primechain Technologies, Intel on blockchain-based KYC.
- United States
- Small Business Borrower Sues Kabbage (PYMNTS), Rated: AAA
- Orchard to Launch Online Lending Industry Page on the Bloomberg Terminal (PR Newswire), Rated: AAA
- KBRA Assigns Preliminary Ratings to SoFi Consumer Loan Program 2017-6 (BusinessWire), Rated: AAA
- DBRS Assigns Provisional Ratings to SoFi Consumer Loan Program 2017-6 LLC (DBRS), Rated: AAA
- FinTechs Taking Larger Share of Personal Loan Market While Increasing Portfolio Risk-Return Performance (Globe Newswire), Rated: AAA
- FT Partners’ CEO Monthly Alternative Lending Market Analysis (FT Partners), Rated: AAA
- 6th Avenue Capital Secures $ 60 Million Commitment For Merchant Cash Advance Funding (AltFi), Rated: A
- Success of CFPB data-sharing guidance relies on how it is enforced (American Banker), Rated: A
- Elevate Credit Third Quarter 2017 Earnings Release Available on Its Investor Relations Website (CNBC), Rated: A
- Fintech Brokerage Robinhood Launches Spotify-Like Web Platform (Benzinga), Rated: A
- LendingTree Announces Top Customer-Rated Lenders by Loan Product for Q3 2017 (Business Insider), Rated: A
- Online lenders shrug off scandals to increase US market share (Financial Times), Rated: A
- R3 to take on Ripple with cross-border payments blockchain (American Banker), Rated: A
- What type of data is fair in credit models? (American Banker), Rated: A
- Foundation Capital Leads CoverWallet Series B Financing (Foundation Capital), Rated: A
- Affirm Now on Apple and Android (NewsCenter.io), Rated: A
- Remitly Raises up to $ 115M in Series D Funding (FINSMES), Rated: A
- New, New Real Estate Crowdfunding Platform (Business Insider), Rated: A
- Which States Do Home Buyers Want to Move to—and From? (Realtor.com), Rated: A
- Real Estate Investing For The Tech-Minded (Forbes), Rated: A
- How SoFi 100X’ed Growth of Their Key Metric — w/ former VP Marketing Steven Dupree (Reforge), Rated: A
- Plan Would Take Payday Lending Interest Rates From As High As 600% to 28% (StateNews.org), Rated: A
- Filene, QCash Financial, CFSI Offer Free Webinar on the Benefits of Small-Dollar Lending (BusinessWire), Rated: A
- Ken Rees, CEO of Elevate, to Speak at Dallas Techweek Conference (BusinessWire), Rated: A
- Elizabeth Warren Warns: Navient Deal A Danger To Student Loan Borrowers (International Business Times), Rated: A
- BrightPlan Launches ‘Hybrid-Robo’ Advisory Service (Plan Adviser), Rated: B
- Will a robot take your job? These startups hope so (PitchBook), Rated: B
- Dreiling and Stamets join Attune (Royal Gazette), Rated: B
- United Kingdom
- RateSetter changes approach to property loan defaults (P2P Finance News), Rated: AAA
- Lendy Update: Breaks Previous Monthly Loan Repayment Record; Recovers £20 Million in October 2017 (Crowdfund Insider), Rated: AAA
- This UK fintech is taking on big banks with business loans — and one key EU law is driving it (CNBC), Rated: AAA
- Citigroup Bets Millions on U.K. Mortgage Lender (Bloomberg), Rated: A
- Citi Provides Warehouse Facility to LendInvest in Buy to Let Expansion (Crowdfund Insider), Rated: A
- The perils and profits of of peer-to-peer lending (The Spectator), Rated: AAA
- Lenders must help brokers meet specialist challenge – LendInvest (Mortgage Solutions), Rated: A
- UK fintechs take market share from dominant high-street banks (Financial Times), Rated: A
- Britain’s small businesses bank on alternative finance options (Finextra), Rated: A
- HSBC unveils robo-advisor plans (Business Insider), Rated: A
- Landbay & Buy to Let Club Complete Lending to New Southgate Building in Less Than Two Months (Crowdfund Insider), Rated: A
- Fintech firm MarketInvoice enters business loans market (Asset Finance International), Rated: A
- Natural evolution (P2P Finance News), Rated: A
- Funding Circle and RateSetter make LinkedIn’s ‘Top 25’ companies list (P2P Finance News), Rated: A
- CEO switch for online lender Patch of Land (AltFi), Rated: A
- P2P firm Assetz continues profitability (AltFi), Rated: A
- Durham’s Atom Bank named by LinkedIn as one of UK’s top 25 start-ups (ChroncleLive), Rated: A
- Online retailer Asos offers buy now pay later option with Klarna (Finextra), Rated: B
- Alternative lender Sancus announces new managing director (AltFi), Rated: B
- Chinese Listed Banks still create more profits than BAT (Xing Ping She), Rated: AAA
- Another Chinese P2P lender! Senmiao Technology files for a $ 20 million IPO (NASDAQ), Rated: A
- Chinese listed company transferred shares of Wei Dai Network, making over 1B RMB (Xing Ping She), Rated: A
- European Union
- Mintos Scraps Secondary Market Fees (P2P-Banking), Rated: AAA
- Orange is the new bank? Telecoms giant ventures into lending (Business Insider), Rated: A
- INFOGRAPHIC: FINTECH AND THE FUTURE (Irish Tech News), Rated: A
- Lendio Gives supports Kiva borrowers (Bankless Times), Rated: AAA
- International P2P Lending Volumes October 2017 (P2P-Banking), Rated: AAA
- Fintech and Cross-Border Payments (IMF), Rated: AAA
- Alternatives assets such as P2P loans to double in volume by 2025 (AltFi), Rated: B
- Zelle adds major tech partners to roster (Banless Times), Rated: B
- One Size Fits All? Regulating Peer-To-Peer Lending Platforms (India Corporate Law), Rated: A
- SBI partners with Primechain Technologies and Intel to adopt blockchain-driven KYC (The Times of India), Rated: A
- P2P lender PeopleFund aims to change landscape (The Investor), Rated: A
- SME failure rate set to spike unless funding issue is addressed (Engineering News), Rated: AAA
Small Business Borrower Sues Kabbage (PYMNTS), Rated: AAA
A small business (SMB) in Massachusetts borrowing funds via marketplace lender Kabbage has sued the platform, igniting new debate in the conversation over the definition of a “true lender,” according to reports in the National Law Review on Tuesday (Oct. 31).
The small business that sued the parties is reportedly arguing that Celtic let Kabbage “rent” that bank charter to originate loans with excessive interest rates, despite Kabbage being the “true lender,” because Kabbage, not Celtic, bears the risk of loss. The plaintiffs are using state usury and consumer protection statutes, the publication said, as well as the federal RICO statute and Lanham Act.
Orchard to Launch Online Lending Industry Page on the Bloomberg Terminal (PR Newswire), Rated: AAA
Orchard Platform’s online lending industry data and insights will be made available to Bloomberg terminal subscribers, providing a wealth of information on an asset class that offers a number of potential investment opportunities.
KBRA Assigns Preliminary Ratings to SoFi Consumer Loan Program 2017-6 (BusinessWire), Rated: AAA
Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three classes of notes issued by SoFi Consumer Loan Program 2017-6 (“SCLP 2017-6”). This is a $591 million consumer loan ABS transaction.
Preliminary Ratings Assigned: SoFi Consumer Loan Program 2017-6
|Class||Preliminary Rating||Initial Class Principal|
DBRS Assigns Provisional Ratings to SoFi Consumer Loan Program 2017-6 LLC (DBRS), Rated: AAA
DBRS, Inc. (DBRS) assigned provisional ratings to the following classes of notes issued by SoFi Consumer Loan Program 2017-6 LLC (SCLP 2017-6):
— $315,000,000 Class A-1 Notes at AA (sf)
— $175,000,000 Class A-2 Notes at AA (sf)
— $75,000,000 Class B Notes at A (sf)
— $26,000,000 Class C Notes at BBB (sf)
FinTechs Taking Larger Share of Personal Loan Market While Increasing Portfolio Risk-Return Performance (Globe Newswire), Rated: AAA
FinTech lenders continue to gain market share in the personal loan space while maintaining their portfolio risk-return performance. Results from TransUnion’s “Fact versus Fiction: FinTech Lenders” study were released today during the Digital Lending + Investing Conference in New York.
To better understand the personal loan market, TransUnion studied unsecured personal loan originations over the past several years, as well as more detailed portfolio performance between 2014 and 2016. The analysis differentiated between those loans issued by banks, credit unions, FinTechs and traditional finance companies to compare performance across lender types. The study found that the balance share of these loans originated by FinTechs had dramatically risen in recent years. At the end of 2016, FinTechs represented 30% of all personal loan balances, up from about 4% in 2012 and less than 1% in 2010. This trend continued through the first six months of 2017, with FinTechs now representing 32% of personal loan balances.
Share of Originated Personal Loan Balances
|Timeframe/Lender||Banks||Credit Unions||FinTechs||Traditional Finance|
|2017 (Through June)||29||%||24||%||32||%||15||%|
|Full year 2016||26||%||23||%||30||%||21||%|
|Full year 2015||27||%||22||%||28||%||23||%|
|Full year 2012||35||%||32||%||4||%||29||%|
As part of this study, TransUnion developed a coarse risk-return metric*. While loans provided by FinTechs experienced higher delinquencies than competitors, specifically within the lower credit risk tiers, TransUnion’s study found that they generated effective portfolio risk-return ratios that exceeded those of banks and credit unions. As of Q2 2017, FinTechs averaged an 8.7% return compared to 6.7% for banks and 6.3% for credit unions. Traditional finance companies average the highest return at 11.5%.
The study demonstrated how FinTechs focus their originations in the near prime and prime risk tiers. As of Q4 2016, 59% of FinTech balances originated were in those two risk tiers. This is slightly higher than the 57% rate in Q1 2014.
Personal Loans Continue to Grow
The study also observed general personal loan trends. Personal loan total balances and consumer participation have both grown considerably. As of Q2 2017, 16.1 million consumers possessed a personal loan, compared to 14.8 million in Q2 2016 and 13.1 million in Q2 2015. Just five years ago in Q2 2012, approximately 9.8 million consumers had a personal loan. Total outstanding balances have risen from about $45 billion in Q2 2012 to $106 billion in Q2 2017.
While conventional wisdom holds that personal loan borrowers fall in the subprime risk bucket, TransUnion data through Q2 2017 show that personal loan adoption is greatest in the near prime (26%) and prime and above (49%) risk levels. Subprime constituted only 25% of such loans.
The most recent TransUnion data show that the number of lenders issuing personal loans has decreased in recent years from 7,245 in 2012 to 6,896 in 2015 and 6,680 in 2016. However, the number of lenders issuing large volumes of personal loans (at least 10,000 annually) has nearly doubled in the last 5 years from 68 in 2012 to 128 in 2016.
FT Partners’ CEO Monthly Alternative Lending Market Analysis (FT Partners), Rated: AAA
October was another very active month for the FT Partners team as we announced seven significant FinTech transactions. We are pleased to announce our role advising:
- TCA on its $275 million sale to E*TRADE
- Planet Payment on its ~$250 million sale to Fintrax
- Remitly on its $115 million Series D financing round led by PayU
- Feedzai on its $50 million Series C financing round
- Credit Sesame on its $42 million financing round
- Billtrust on its strategic investment and partnership with Visa
- Moneyfarm on its acquisition of the assets of Ernest
Download the full report here.
6th Avenue Capital Secures $ 60 Million Commitment For Merchant Cash Advance Funding (AltFi), Rated: A
6th Avenue Capital, LLC (“6th Avenue Capital”), a provider of small business financing solutions, announced today its securement of a $60 million commitment from a large institutional investor. The investor made their commitment based on 6th Avenue Capital’s industry-leading underwriting, compliance standards and processes. 6th Avenue Capital will draw from this commitment to offer merchant cash advances to small businesses through its nationwide network of Independent Sales Organizations (“ISOs”) and other strategic partnerships, such as banks and small business associations.
Success of CFPB data-sharing guidance relies on how it is enforced (American Banker), Rated: A
This month, the Consumer Financial Protection Bureau took an important step toward making that potential a reality with its release of consumer-authorized data-sharing and aggregation principles. In the principles, the bureau reiterated consumers’ right to share data, recognizing that connectivity is the underlying magic fueling the consumer fintech revolution. The guidelines will promote innovation, competition and consumer control.
Data sharing often requires consumers to provide their bank account usernames and passwords to third parties. In the guidance, the CFPB clarified that granting consumers access to their data does not necessarily mean sharing login credentials. At the same time, the bureau made it equally clear that if banks and others want to prevent the sharing of credentials, they need to find another, more secure way to provide access. Both banks and data aggregators should have an incentive to eliminate the use of credentials.
Third, banking regulators could update their third-party vendor risk management guidelines to clarify the kinds of due diligence banks are required to conduct on parties with whom they share data.
Elevate Credit Third Quarter 2017 Earnings Release Available on Its Investor Relations Website (CNBC), Rated: A
Elevate Credit, Inc. (NYSE:ELVT) (“Elevate” or the “Company”), today announced financial results for the third quarter ended September 30, 2017. Elevate has posted its third quarter earnings release to its Investor Relations webpage at http://investors.elevate.com/press-releases/2017.
Fintech Brokerage Robinhood Launches Spotify-Like Web Platform (Benzinga), Rated: A
Robinhood, the fintech brokerage that offers commission-free trading through a mobile app, announced Wednesday it’s launching a web platform.
Bhatt says the web trading platform is primarily geared towards informing people who are interested in investing about the stock market. However, the company faces an interesting product design challenge, in that about half of its users have invested previously on another platform.
LendingTree Announces Top Customer-Rated Lenders by Loan Product for Q3 2017 (Business Insider), Rated: A
LendingTree®, the nation’s leading online loan marketplace, today released its quarterly list of the top customer-rated lenders on its network based on actual customer reviews for the third quarter of 2017. The list features the top lenders in multiple loan product categories, including Mortgages, Personal Loans, Business Loans and Auto Loans, all of which are included in LendingTree’s online loan marketplace.
Personal Loans Category
Auto Loans Category
Online lenders shrug off scandals to increase US market share (Financial Times), Rated: A
The online lenders set up to upend US retail banking in the wake of the financial crisis are still expanding in spite of scandals and setbacks at some of the biggest names in the business.
Financial technology groups originated $15bn of personal loans in the first half of the year, according to figures published on Thursday by TransUnion, the credit bureau whose database covers the borrowing habits of 220m consumers.
That was almost a third of the total US market for new personal loans — a bigger share than banks or credit unions or other traditional consumer finance companies — and compares with just 4 per cent in 2012 and 28 per cent in 2015.
R3 to take on Ripple with cross-border payments blockchain (American Banker), Rated: A
R3 is working with 22 of its member banks to build a real-time, cross-border payments solution on Corda, the consortium’s “blockchain inspired” distributed ledger.
The banks include U.S. Bank, TD Bank, Barclays, BBVA, CIBC, Commerzbank, DNB, HSBC, Intesa, KBC, KB Kookmin Bank, KEB Hana Bank, Natixis, Shinhan Bank and Woori Bank, R3 said Tuesday.
What type of data is fair in credit models? (American Banker), Rated: A
It’s long been a mantra in the fintech community: Traditional underwriting models that rely heavily on conventional credit scores leave out people who haven’t built up a credit history. A percentage of these people are creditworthy, but without a history to go on, the credit bureaus haven’t created profiles of them yet.
To assess whether unscored people can repay loans, lenders are increasingly looking at “alternative data” — information that comes from someplace besides a traditional credit bureau that can help predict how a potential ….
Foundation Capital Leads CoverWallet Series B Financing (Foundation Capital), Rated: A
Which is why we’re excited to have led the Series B for CoverWallet, an online insurance broker for small businesses which is upending the industry.
Small-to-medium business (SMB) insurance is a profitable, but highly fragmented $100 billion/year market. At the present, SMB insurance is sold through 40k+ brick-and-mortar insurance brokers, which employ 500k+ agents and move 99% of premiums. The typical SMB insurance application has 27 pages, and is completed while having “the talk” with the agent, which will include many upsell & cross-sell attempts. The typical SMB insurance quote takes 7-10 days. For SMB owners, this process is time consuming and painful.
Affirm Now on Apple and Android (NewsCenter.io), Rated: A
Affirm, a popular web service that allows users to buy online and pay off their purchases in fixed monthly payments, has launched their Android and iPhone app.
Remitly Raises up to $ 115M in Series D Funding (FINSMES), Rated: A
Remitly, a Seattle, WA-based independent digital remittance company, is to raise up to $115m in Series D funding.
The financing – subject to applicable third party and regulatory approvals – will be led by Naspers’ fintech investment division PayU, a global online payment service provider, with participation from existing investors Stripes Group, DFJ, and DN Capital. In conjunction with the funding, Laurent le Moal, PayU CEO, will join Remitly’s board of directors.
New, New Real Estate Crowdfunding Platform (Business Insider), Rated: A
When you see prominent investors such as George Soros, Larry Silverstein and Goldman Sachs participating in the real estate crowdfunding business – it means something. So, let’s follow the smart money. The real estate crowdfunder that everyone is talking about now is CityVest, which claims a top pedigree of founders and investors. And is living up to its mission – Smarter Real Estate Investing.
CityVest provides wealthy individuals with online access to institutional real estate funds and the higher rates of return they generate.
Which States Do Home Buyers Want to Move to—and From? (Realtor.com), Rated: A
Prospective home buyers overwhelmingly want to head south, according to a recent LendingTree analysis. The online loan marketplace looked at the 1.5 million mortgage requests it received from October 2016 to October 2017 to come up with the results.
Which state do home buyers most want to move to?
But of all the Southern states, which was the most desirable? Drumroll please … that would be Florida. The Sunshine State was the top destination for folks from 18 states, or about 9.14% of those looking at loans on LendingTree.
Which state do home buyers most want to leave?
Vermont residents were the most likely to want to hightail it out of the Green Mountain State. Despite its popular ski resorts, only about 76% of locals were looking for in-state mortgages.
Which state do home buyers most want to stay in?
Texans were the most happy of any state’s residents to stay put. About 92.5% of folks looking for potential mortgages wanted to stay within Texas, according to LendingTree’s report.
Real Estate Investing For The Tech-Minded (Forbes), Rated: A
So as a techie, how does one go about evaluating not just the real estate but also the platform offering the investment?
That’s why it’s critical for real estate investing platforms to be willing and able to answer questions from prospective investors — even those would-be investors without a ton of prior real estate knowledge. These companies should take a page out of Amazon’s book and develop a customer obsession.
Be leery of any cliché claims of leveraging big data to automate underwriting. Underwriting is as much science as it is intuition/experience, and the best commercial real estate professionals have a carefully tailored mix of both.
In the long run, the track records of the platforms will speak loudest.
How SoFi 100X’ed Growth of Their Key Metric — w/ former VP Marketing Steven Dupree (Reforge), Rated: A
Steven Dupree was SoFi’s first marketing executive and VP of marketing for 3 years. He and his growth-oriented team took SoFi from originating 10 loans a day to over 1000.
The three most basic ingredients for being able to succeed in FinTech are:
1) “Good enough” technology
2) Tremendous capital markets expertise
3) Some sort of customer acquisition strategy
Companies like Experian and Equifax know if you have loan balances, and specifically they know if you have student loan balances. We sent pre-screened offers to prospects with outstanding student loan debt through physical mail about how SoFi could help them with those loans.
Plan Would Take Payday Lending Interest Rates From As High As 600% to 28% (StateNews.org), Rated: A
Several community groups rallied to show their support for a bipartisan bill they think is needed reform against predatory lending.
The bill would cap the interest rate of payday lenders at 28% and close any loopholes around that cap.
Filene, QCash Financial, CFSI Offer Free Webinar on the Benefits of Small-Dollar Lending (BusinessWire), Rated: A
QCash Financial, a CUSO providing automated, cloud-based, omni-channel small-dollar lending technology for financial institutions, announces it will co-host a free webinar with Filene Research Institute and the Center for Financial Services Innovation to discuss the opportunities for credit unions in offering small-dollar lending on November 14.
During the webinar, QCash Financial will address our industry’s impact and opportunity to deliver small dollar loans. QCash Financial, the Center for Financial Services Innovation and Filene will collaborate to discuss the omni-channel lending solution that serves members in search of small, short-term unsecured loans.
Registration information can be found at filene.com. The webinar is scheduled from 2 p.m. CST / 12 p.m. PST until 3 p.m. CST / 1 p.m. PST.
Ken Rees, CEO of Elevate, to Speak at Dallas Techweek Conference (BusinessWire), Rated: A
Ken Rees, Chief Executive Officer at Elevate, a leading tech-enabled provider of innovative and responsible online credit solutions for non-prime consumers, will speak on a panel session at Dallas Techweek on Thursday, November 2, at 9:15am CT. The panel will focus on data intelligence, breaking down the hype around data science, and exploring ways companies can turn that hype into actionable business intelligence.
Rees will be joined by local tech talent and founders, including Clarisa Lindenmeyer, Chief of Strategy/Partnerships at Launch DFW; Sravan Ankaraju, President of Divergence.Academy, CEO of Divergence.AI; Dave Copps, CEO of Brainspace; and Steve Hebert, Co-Founder & CEO of Nimbix, Inc.
Elizabeth Warren Warns: Navient Deal A Danger To Student Loan Borrowers (International Business Times), Rated: A
U.S. Sen. Elizabeth Warren warned Wednesday that the nation’s largest student loan servicer has positioned itself to stealthily strip consumer protections from unwitting borrowers across the country. In an interview with International Business Times, she also said the loan servicer, Navient, should not be permitted to be a government contractor handling student loans on behalf of the U.S. Department of Education.
The Massachusetts Democrat was sounding an alarm about Navient’s recent acquisition of online lender Earnest. She said the transaction opened up the possibility that the company will try to boost its profits by selling debtors on refinancing their current federal student loans with the company’s own private loans — the kind that she said to do not necessarily permit income-based repayment options.
BrightPlan Launches ‘Hybrid-Robo’ Advisory Service (Plan Adviser), Rated: B
A new robo-advisory platform has hit the market, under the moniker BrightPlan.
Important to note, according to the firm, clients are not required to invest through BrightPlan in order to receive financial planning advice. They can manually input external account balances or link external accounts from more than 10,000 financial institutions to BrightPlan, which will monitor goal progress and provide advice to stay on track.
Will a robot take your job? These startups hope so (PitchBook), Rated: B
Avant wants to replace loan officers
Avant has created an online lending platform that uses Big Data and machine learning algorithms to streamline the loan decision process helping borrowers consolidate debt through personal loans. The company, led by CEO and co-founder Al Goldstein (pictured), raised $325 million in Series E financing back in September 2015, with General Atlantic leading a round at a $2 billion valuation.
Avant isn’t alone, with competitors like publicly traded Lending Club (NYSE: LC) and VC-backed Kabbage using a similar strategy: automating the credit creation process.
Dreiling and Stamets join Attune (Royal Gazette), Rated: B
Two new appointments have been made at data-enabled platform Attune, the company jointly created last year by American International Group, Hamilton Insurance Group and Two Sigma Investments.
Martha Dreiling takes on the role of head of analytics and corporate operations, while Richard Stamets has been appointed head of underwriting strategy.
RateSetter changes approach to property loan defaults (P2P Finance News), Rated: AAA
RATESETTER is changing the way it deals with defaulted property development loans, which could involve taking control of the project and completing it itself.
The peer-to-peer lender said on Wednesday that if a property development is only partially completed and has gone into default, it will now examine whether maximum value would be delivered via an immediate sale or by completing the development and then selling it.
Lendy Update: Breaks Previous Monthly Loan Repayment Record; Recovers £20 Million in October 2017 (Crowdfund Insider), Rated: AAA
UK-based peer-to-peer property platform Lendy announced on Thursday it has broken all previous records for loan repayments generated in any one month, recovering £20 million in total in October 2017 alone. The online lender reported that this exceeds its previous September 2016 high of £14.5 million. The record figure includes repayments on P2P loans on three caravan parks in Christchurch, Dorset, totaling £7.6 million and a Manchester mill of £1.35 million.
This UK fintech is taking on big banks with business loans — and one key EU law is driving it (CNBC), Rated: AAA
A digital invoice finance platform in the U.K. will provide business loans to its customers for the first time, it was announced Wednesday.
The firm said it would expand into the business lending market, pitting it against established players such as U.S. listed peer-to-peer lender LendingClub and Britain’s Funding Circle. The latter raised £82 million ($100 million) in funding from venture capital investors earlier this year.
CEO and co-founder Anil Stocker told CNBC that MarketInvoice will take advantage of an incoming European Union regulation called the Second Payment Services Directive (PSD2), which forces banks to open up data about their customers to third party companies.
Citigroup Bets Millions on U.K. Mortgage Lender (Bloomberg), Rated: A
Brexit may be roiling Westminster and inflating prices on supermarket shelves, but don’t tell that to financial institutions eyeing the U.K.’s burgeoning online-lending industry.
In the latest sign of confidence in the sector, Citigroup Inc. has agreed to provide a fintech firm called LendInvest Ltd. with funding for mortgages, the startup said in a statement Wednesday.
Citi Provides Warehouse Facility to LendInvest in Buy to Let Expansion (Crowdfund Insider), Rated: A
LendInvest, a Fintech marketplace platform for property finance, has agreed a long-term warehouse facility with Citi boosting its entry into the UK’s £40 billion buy-to-let (BTL) market.
The perils and profits of of peer-to-peer lending (The Spectator), Rated: AAA
‘We’re taking business from the banks, from the invoice discounters and from the traditional suppliers of finance, in ever larger amounts,’ says Angus Dent, chief executive of ArchOver, a P2P lender that launched in September 2014. ‘We only lend to companies with strong balance sheets and we only lend against accounts receivable (ARs). We will loan up to 80 per cent of the value of the ARs. Once the loan is made the ARs must be maintained at 125 per cent of the value of the loan, monitored by us on a monthly basis. This provides a quickly realisable asset for our investors in case the borrower gets into difficulties over repaying for the loan.’ The minimum amount that ArchOver expects clients to invest is £1,000 per project.
For Anil Stocker, chief executive and co-founder of MarketInvoice, P2P lending against receivables (amounts owed to a business) offers a particularly interesting investment class ‘because it’s of short duration, a liquid product, with invoices typically taking 45 to 50 days to be paid.
Lenders must help brokers meet specialist challenge – LendInvest (Mortgage Solutions), Rated: A
IMLA found that lending by specialists has grown by an average of 19% each year from 2009 to 2016, with a total of almost £17bn lent last year. That’s enormous growth from a sector that was particularly badly dented by the effects of the financial crisis.
Even with these enormous annual increases in lending, the market share of these specialists remains modest. According to IMLA it has grown from 3.5% in 2009 to 6.8% in 2016, and that still lags significantly below the levels seen before the onset of the financial crisis.
UK fintechs take market share from dominant high-street banks (Financial Times), Rated: A
Britain’s leading financial technology start-ups are celebrating a record-setting week as they accelerate their push to take market share from high-street banks in areas such as payments and lending.
TransferWise will on Thursday announce that it has collected $280m from investors, a record fundraising round for a UK fintech, to finance expansion of its cross-border payments service into more countries around the world.
Meanwhile, Funding Circle has for the first time outstripped net new lending by the major high-street banks to UK small businesses, according to figures released by the Bank of England this week and data provided by Europe’s largest peer-to-peer lender to SMEs.
Britain’s small businesses bank on alternative finance options (Finextra), Rated: A
Of 1000 small biz owners quizzed by WorldPay, more than half say that they are planning for growth in 2018, yet 52% admit to being concerned that the traditional routes to finance, such as bank loans, are not going to be as easily available in the coming year.
While 21% of business owners aged 44 or under say they’re still most likely to apply for a bank loan when looking for funding, nearly as many respondents (17%) say they’re more likely to look at crowd-funding, while 11% prefer P2P lending, and six per cent say they favour business cash advance.
HSBC unveils robo-advisor plans (Business Insider), Rated: A
HSBC’s head of retail wealth, Dean Butler, provided his perspective on automated advice, and the bank’s plans for new products in the area, at the UK Robo-Advice Innovation Forum on Wednesday, attended by BI Intelligence.
Landbay & Buy to Let Club Complete Lending to New Southgate Building in Less Than Two Months (Crowdfund Insider), Rated: A
Earlier this week, Landbay and Buy to Let Club completed lending to a new building in Southgate, a suburban area of north London, in under two months. The initial case was reportedly submitted on the broker portal by Buy to Let Club on August 24th.
Fintech firm MarketInvoice enters business loans market (Asset Finance International), Rated: A
Fast-growing fintech firm MarketInvoice has launched a new business loans service that expands its solutions beyond invoice finance.
Businesses will now be able to obtain unsecured business loans from £10,000 to £100,000 over a 12-month term, with no early repayment fees.
By expanding into the £35 billion business loans sector, MarketInvoice aims to increase support for businesses which need working capital around their invoice finance requirements.
Natural evolution (P2P Finance News), Rated: A
Stuart Lunn, co-founder and chief executive of Edinburgh-based P2P business lender LendingCrowd, sees the benefits of both.
“For P2P investing to become truly mainstream, it’s essential to simplify the products on offer and enable greater comparability between opportunities,” he asserts.
“Passive products force greater diversification and I think that will benefit the sector as a whole.”
Funding Circle and RateSetter make LinkedIn’s ‘Top 25’ companies list (P2P Finance News), Rated: A
Funding Circle and RateSetter have been placed at number eight and number 21, respectively, in the ‘LinkedIn Top 25 Companies – Startups’ list, which was released on Thursday morning.
Funding Circle was the highest-ranking P2P platform, and it was praised for funding more than 28,800 companies over the past seven years, with more than £2.8bn allocated to borrowers.
CEO switch for online lender Patch of Land (AltFi), Rated: A
Jason Fritton returns to his former post as CEO, as Paul Deitch steps down.
P2P firm Assetz continues profitability (AltFi), Rated: A
Assetz Capital notches seven figure pre-tax profit during the six months from April to September 2017.
Durham’s Atom Bank named by LinkedIn as one of UK’s top 25 start-ups (ChroncleLive), Rated: A
A North East company has been named by social media site LinkedIn as one of the country’s 25 most disruptive companies.
Durham ’s Atom Bank, which is shaking up the banking world with its mobile-based app and personalised services, is named alongside companies including Deliveroo, Uber and Airbnb, on a list of start-ups which LinkedIn says are changing the UK business landscape.
Online retailer Asos offers buy now pay later option with Klarna (Finextra), Rated: B
Today, leading European payments provider Klarna has announced a UK partnership with ASOS – one of the world’s leading destinations for fashion loving 20-somethings.
Alternative lender Sancus announces new managing director (AltFi), Rated: B
The alternative finance services firm has announced that Dan Walker will take over from current MD Caroline Langron in January 2018.
The group is part of GLI Finance, which acquired peer-to-peer lending platform FundingKnight in 2016. Earlier this year, FundingKnight was moved into Sancus BMS Group, was awarded full FCA authorisation in July.
Chinese Listed Banks still create more profits than BAT (Xing Ping She), Rated: AAA
In recent years, with the rise of Internet financial and the change of macroeconomic environment, the traditional commercial banks did go through a “severe winter”. Since 2011, banking climate index has been down all the way. It is not until 2017 that the new season of spring is coming.We selected 38 listed Chinese Banks in exchange of Shanghai, Hong Kong and Shenzhen as the performance comparison samples, and analyzed their comprehensive profitability based on the financial data of the first half of 2017.During this time, the total net profit of the 38 banks selected in this paper was 823.93 billion RMB, up 4.14 percent from the same period last year. The chart below described the profit data of all the 38 banks in the first half of 2017.
Profitability Banks Ranking
Among the 38 listed banks, we can also find the Top10 earning banks as follows, including 5 large-scale commercial banks and 5 joint-equity commercial banks. In addition, the net profit of Ping An Bank and Beijing Bank has reached the threshold of 10 billion RMB.
Chinese listed banks VS internet giants in profitability
According to the total value and earning data of the selected 38 listed banks as follow, their total market capitalization is about 10 trillion RMB, and the total net profit was 823.93 billion RMB. That means the net profit ratio was about 0.082.
As for the BAT giants which are closely watched in the Internet industry, the three Internet companies are worth about 6.5 trillion RMB in total for the first half of 2017, and the net profit reached 52 billion RMB. That means their net profit ratio was just 0.008, much lower than the listed banks. Obviously, Banks still have an advantage over emerging Internet companies in terms of profit creation.
In fact, research shows that the rise of the Internet financial companies has little impact on the profitability of large commercial Banks and rural commercial Banks, while has a great influence on city commercial Banks, and Joint-stock commercial Banks have been promoted instead because they can seize the Internet financial opportunities. In general, though the development of Internet finance has brought adverse effects on the profitability of commercial Banks, and also forced it to actively adjust the profit model and promote the diversified development of the profit structure.
Data resource: Wind Database
Another Chinese P2P lender! Senmiao Technology files for a $ 20 million IPO (NASDAQ), Rated: A
Senmiao Technology, a early-stage Chinese marketplace for peer-to-peer lending, filed on Monday with the SEC to raise up to $20 million in an initial public offering.
China pours millions into facial recognition start-up Face++ (Financial Times), Rated: A
Chinese facial recognition start-up Megvii Face++ has raised $460m in an investment round led by a government fund, as the country pours money into efforts to become an artificial intelligence superpower to rival the US.
The Beijing-based Face++ said on Wednesday that it had raised money from China State-Owned Venture Capital Fund and the China-Russian Investment Fund, which is backed by the sovereign wealth funds of both countries. Private investors including Alibaba’s payments affiliate Ant Financial also participated.
Chinese listed company transferred shares of Wei Dai Network, making over 1B RMB (Xing Ping She), Rated: A
On October 17, Handing Yuyou(300300.SZ), a listed company that was suspended from trading, began to transfer its assets of internet finance continuously. On October 30th, the company announced that it would transfer a 2 percent stake in the Wei Dai Network for 170m RMB, and then they announced to transfer a 1.5 percent stake in the Wei Dai Network for 127.5 million RMB. Through the two deals, Handing Yuyou(300300.SZ) will receive nearly 300 million RMB in cash. Deducting the previous investment costs, Handing Yuyou(300300.SZ) won over 100 million RMB in less than half a year. In the past three years, according to the company’s history of the investment in Wei Dai Network, we can find that the company has earned at least 10 times to the original investment.
The transferee of this transaction is Beijing Qianshan Xinyuan Investment Management co., LTD. According to the public information, Beijing Qianshan Xinyuan Investment Management co., LTD. was established in 2015 with the registered capital of 10 million RMB. Its parent company, Qianshan Capital Management co., LTD is a private company registered in 2016. The parent company also have the other several subsidiary corporations, including Qianshan Venture Investment Management co., LTD., Beijing Qianshan Wealth Management co., LTD., etc. Currently, the parent company has a total capital size of 1 billion RMB.
Mintos Scraps Secondary Market Fees (P2P-Banking), Rated: AAA
Starting from today, November 1, 2017, we have removed the 1% fee for selling loans on the secondary market of the Mintos marketplace. This means from now on, there are absolutely no fees for investing through Mintos.
Orange is the new bank? Telecoms giant ventures into lending (Business Insider), Rated: A
Telecoms giant Orange launches its own bank on Thursday, aiming to win 25 percent of France’s online banking market by capitalizing on the rising use of smartphones to steal share from established lenders with inferior technology.
Orange is starting from a small base – Coisne says it has 25,000 customers have expressed interest ahead of the launch, a tiny fraction of the company’s 21 million mobile clients. But the timing of its entry gives some room for optimism.
In France, 793.4 million online banking e-payments were made last year according to the European Central Bank, up from 586.2 million in 2014.
INFOGRAPHIC: FINTECH AND THE FUTURE (Irish Tech News), Rated: A
The GetLine Network http://getline.in/, a decentralized P2P lending platform, recently reached out to us with one of their infographics on FinTech, and we thought it was appropriate and timely for our audience.
Financing and loans are even being re-thought of with new forms of capital raising, such as ICOs, crowdsourcing/crowdfunding, and P2P lending, making banks and legacy financial institutions even less needed.
Lendio Gives supports Kiva borrowers (Bankless Times), Rated: AAA
Small business loan marketplace Lendio announced it has provided more than $25,000 in loans to over 1,200 small business owners in 75 countries around the world through its employee-based Lendio Gives program in partnership with Kiva.
The top five sectors supported by Lendio’s funding are agriculture, food, retail, clothing, and services. Of the loans Lendio has funded, 86 percent have gone to women or women’s groups. The top countries Lendio has supplied funding to include Zimbabwe, Peru, Haiti, the Democratic Republic of Congo, Ecuador, the Philippines, Kenya, El Salvador, and Senegal.
International P2P Lending Volumes October 2017 (P2P-Banking), Rated: AAA
Thincats reached the milestone of 250 million GBP loans originated since launch.
This month I added Bolden.
Fintech and Cross-Border Payments (IMF), Rated: AAA
To gauge the IMF’s most recent analysis: A speech last month, at the Bank of England, by the IMF’s Managing Director—Christine Lagarde—analyzed potential challenges posed by fintech innovations to central banking.
In my remarks here today—focusing on implications of fintech for cross-border payments—I’ll explore three broad areas: 
- First, a sketch of the economic framework on how fintech applications will affect financial services and the market structure.
- Second, the current landscape of cross-border payments, and the possible evolution of cross-border payment systems; and
- Third, the role of central banks, themselves, and the possible reasons for them to issue their own digital currencies.
Alternatives assets such as P2P loans to double in volume by 2025 (AltFi), Rated: B
Alternative asset classes – in particular, real assets, private equity and private debt – will more than double in size, reaching $21.1trn by 2025, accounting for 15 per cent of global AuM as investors diversify to reduce volatility and target specific return and risk outcomes, according to research by PwC.
Zelle adds major tech partners to roster (Banless Times), Rated: B
Zelle – a new, real-time payments network from bank-owned Early Warning Services – has added ACI Worldwide, CGI, D3 Banking Technology, and IBM to its growing list of technology partners.
One Size Fits All? Regulating Peer-To-Peer Lending Platforms (India Corporate Law), Rated: A
Briefly, as per the Master Directions:
- It is now mandatory for entities proposing to undertake this business to be registered as ‘NBFC-P2P Lending Platforms’ with the RBI (NBFC-P2P). To ensure business continuity, existing players have been given a period of three months to apply for this licence. Applicants will be scrutinised for scalable and secure technological capabilities, financial standing as well as fit and proper management.
- Fundamentally, the NBFC-P2P is expected to operate only as an intermediary and not undertake any lending activities itself or hold any funds of its participants (lenders or borrowers) on its books. Towards this end, an escrow mechanism for movement of funds has also been envisaged.
- The exposure of each lender and loans (not exceeding a three year maturity period) availed by each borrower across all NBFC-P2Ps has also been capped at INR 10 lakhs, with each borrower not permitted to avail more than INR 50,000 per lender.
- In addition, directions also prescribe that NBFC-P2Ps adopt minimum standards of transparency, disclosure requirements and fair practices.
Impact on Aggregators
- To the extent P2P lending platforms are servicing individuals and/or unregulated entities, there is merit in regulating such operators to contain any systemic risks. However, there are existing players in the market who primarily service regulated financial institutions (viz. banks and NBFCs) as lenders. The Master Directions fail to recognise this distinction.
- Separately, banks and NBFCs today use distribution channels including web-based loan aggregators.
SBI partners with Primechain Technologies and Intel to adopt blockchain-driven KYC (The Times of India), Rated: A
PrimechainTechnologies announced on Wednesday that the country’s largest bank, State Bank of India (SBI), will adopt blockchain technology to manage the mandatory Know Your Customer (KYC) details in its system. Intel Corporation will act as a technology provider to facilitate the implementation.
P2P lender PeopleFund aims to change landscape (The Investor), Rated: A
Korea’s accumulated peer-to-peer lending reached 1.47 trillion won (US$1.31 billion) by end-September as more and more borrowers are embracing the new, more convenient platforms for connecting with investors.
Considering that the figure accounts for only 60 members of the Korea P2P Finance Association among the industry estimates of 130 lenders, the market is actually bigger. It also reflects a sharp upward trend; back in June 2016, when the association first began compiling data, accumulated loans granted by 22 members stood at just 152 billion won.
Against this background, Kim founded PeopleFund in March 2015. Since then, the bank has been on a roll. On Nov. 1, its accumulated loans stood at 121 billion won, compared to 19 billion won in February. It’s the No. 3 player in the local industry.
SME failure rate set to spike unless funding issue is addressed (Engineering News), Rated: AAA
The South African SME sector is set for a major crisis unless access to adequate business funding can be ensured as a matter of urgency. This was the key takeout from the just-released Key Funding Challenges for South African SMEs 2017 report developed by online lenderLulalend.
“76% of respondents to our national survey of SMEs said they had undergone a tedious months-long paperwork-heavy process in applying for businessfunding from traditional lenders, only to have their applications denied.
Considering access to credit was the #1 business challenge for nearly three out of every five SMEs surveyed, this disconnect between the needs of business owners and the lenders that have traditionally supported them is creating conditions of high risk and volatility.”