- Today’s main news: Landbay raises 1.2M GBP on Seedrs. Yirendai issues quarterly earnings results. Betterment boosts human advice. Flender to raise 50M Euro. Cash Suvidha raisess $1M.
- Today’s main analysis: The VC and PE markets in Canada.
- Today’s thought-provoking articles: PeerIQ’s credit facility management suite. Is community bank SMB lending eroding? Africa’s big blockchain potential.
- Betterment’s rise as a robo-advisor. AT: “This is an excellent interview that gives some good insight into the Betterment business model.”
- PeerIQ’s credit facility management suite. AT: “In addition to providing some commentary on last week’s industry news, this PeerIQ blog post highlights the firm’s credit facility management suite.”
- Is small business lending eroding at community banks? AT: “A worthwhile question that deserves an answer.”
- Technology is an ever-widening area for community banks. AT: “If community banks don’t start making tech work for them, improving processing, making lending more efficient and cost-effective, and improving services, they will find themselves going extinct. They will be replaced by tech companies that can do banking better.”
- Marlin secures $300K.
- Tech jobs in Chicago are up, and that includes Enova.
- LendIt Fintech preview show.
- Landbay raises 1.2M GBP on Seedrs. AT: “Congratulations.”
- Investors should consider P2P lending.
- EasyMoney launches second IFISA.
- Tech companies ramp up services and put big banks on notice.
- SALT leverages the blockchain for cash loans.
- Why ZPER is a smart choice for investing.
- United States
- Robo Pioneer Betterment Goes Upscale, Boosts Human Advice (ThinkAdvisor), Rated: AAA
- PeerIQ’s Credit Facility Management Suite (PeerIQ), Rated: AAA
- Is community bank small business lending eroding? (Banking Exchange), Rated: AAA
- Tech ever-widening domain for community banks (Banking Exchange), Rated: A
- Marlin Secures $ 300,000,000 Forward Flow Agreement to Expand Equipment Financing for Small Businesses (GlobeNewswire), Rated: A
- Technology jobs in the Chicago area are up, but that’s not the whole story (Chicago Tribune), Rated: A
- LendIt Fintech USA 2018 Preview Show (Lend Academy), Rated: A
- United Kingdom
- Landbay Returns to Seedrs & Quickly Raises £1.2 Million in Funding (Crowdfund Insider), Rated: AAA
- Deposit rates are a joke, so investors should consider peer-to-peer lending (The Times), Rated: A
- EasyMoney launches second IFISA with higher returns (Peer2Peer Finance), Rated: A
- Yirendai (YRD) Issues Quarterly Earnings Results (The Lincolnian Online), Rated: AAA
- China’s P2P lenders brace for renewed regulatory crackdown (Financial Times), Rated AAA
- European Union
- Peer-to-peer lending start-up Flender to announce €50m debt round (The Irish Times), Rated: AAA
- Dutch Startup Aims To Boost Earnings Of P2P Services (Cointelegraph), Rated: A
- Big banks on notice as tech groups ramp up pressure (Financial Times), Rated: AAA
- SALT: Leverage Your Blockchain Assets to Secure Cash Loans (SludgeFeed), Rated: A
- Why ZPER is a Smart Investment Choice (NewsBTC), Rated: B
- Fintech Startup Cash Suvidha Raises $ 1 M in Pre-Series A Funding (Next Billion), Rated: AAA
- Peer to Peer Lending Market is Anticipated Significant Growth due to Earliest Adopters of Latest Technologies (Digital Journal), Rated: A
- THE VC AND PE MARKETS IN CANADA (AllAboutAlpha), Rated: AAA
- Blockchain’s big potential in Africa (Venture Beat), Rated: AAA
Robo Pioneer Betterment Goes Upscale, Boosts Human Advice (ThinkAdvisor), Rated: AAA
Now with $13.5 billion in assets under management, the firm claims to be the largest independent online financial advisor. Indeed, its high-net-worth offering, or Prime Plan, has been embraced by investors with accounts ranging from $100,000 to many millions, according to Holeman.
Betterment, founded in 2008 as an automated digital-only advice platform, now has 340,000 customers, ranging from millennials to 85-year-olds, with an average age of 37 and an average balance just under $40,000.
How have your fees changed?
Before, we didn’t have the ability to talk with a human advisor; now we have certified financial planners. There are two levels of pricing: the basic digital plan [no minimum account size], which is 0.25% per year and our premium plan [$100,000 minimum account] for 0.4% per year to talk with a certified financial planner on an unlimited basis.
PeerIQ’s Credit Facility Management Suite (PeerIQ), Rated: AAA
US GDP growth for the 4th quarter was revised upwards from 2.5% to 2.9%, capping an impressive 2017. Consumer spending has driven the bulk of GDP growth and it will be relevant to see if this trend continues given the weak retail sales in Q1 and softening in some leading economic indicators. Core PCE, the Fed’s preferred inflation indicator rose 1.8% YoY in February. Personal spending rose 0.2% while incomes rose 0.4% MoM suggesting that Americans are saving more – a long-term positive for growth – although a short-term pressure on retail sales and consumer spending.
PeerIQ’s Credit Facility Management Suite
The Credit Facility Management Suite provides:
- Dashboard overview of multiple facilities across various asset classes
- Daily Covenant Calculation and Monitoring
- Time Series Visualization and Projections
- Automated Borrowing Base Report Generation
- Collateral Cashflow Projections
- Scenario Analysis
Is community bank small business lending eroding? (Banking Exchange), Rated: AAA
Quarles, speaking March 26 at a HOPE Global Forum, told of recent meetings he had had with owners of very small businesses. He noted that their comments jibed with trends the central bank has seen. A key one is that small businesses still face gaps in available credit although more than two-thirds of those studied by the Fed request less than $100,000 and many less than $25,000.
Who’s lending to small businesses?
“Large banks’ share of small business lending has grown,” said Quarles, “especially among the smallest loans. This represents a change from 20 years ago when small businesses relied more on a relationship with local community banks for access to credit.”
Quarles shared figures for loans under $100,000. He said that small banks of less than $1 billion hold 19% of such loans—versus 60% two decades ago. By contrast, he said, that 60% share is now held by banks with $50 billion or more in assets.
Quarles next discussed nonbank alternative lenders. This included fintech specialists as well as large technology firms that extend credit to merchants who are part of their customer bases. (Quarles did not mention names, but examples of the former would include online lender Kabbage and the former would include Amazon, which grants credit to small firms that are part of its base.)
Tech ever-widening domain for community banks (Banking Exchange), Rated: A
“Anybody who doesn’t believe that is kidding themselves,” says James Beckwith, president and CEO at $972.8 million-assets Five Star Bank in Rocklin, Calif.
The attractiveness of tech-based marketplace lending, for example, is only going to increase, Beckwith says. Also, payments innovations, going on inside and outside banking, can’t be ignored by consumer or business bankers.
Marlin Secures $ 300,000,000 Forward Flow Agreement to Expand Equipment Financing for Small Businesses (GlobeNewswire), Rated: A
Marlin Business Services Corp. (NASDAQ:MRLN) a leading provider of credit products and services to small businesses, today announced that it has entered into a forward flow sale agreement with Varadero Capital, L.P., a leading alternative asset management firm, to sell up to $300,000,000 in equipment leases and loans to be originated by Marlin.
Technology jobs in the Chicago area are up, but that’s not the whole story (Chicago Tribune), Rated: A
Unlike at Enova, the overall number of technology jobs in the Chicago region grew at a modest pace last year, both at tech firms and in other industries.
Even before Chicago entered the cutthroat competition last fall to win Amazon’s second headquarters, dubbed HQ2, the city promoted the growth. Emanuel’s office issued at least eight news releases in 2017 on technology companies planning to hire. One of them named more than a dozen companies with hiring goals by the end of 2017.
Enova was on that list, with an aim to hire 75. Instead, it brought on 128 new people, raising its total employee count to 1,145.
And analytics was only the second-fastest-growing team at Enova last year.
LendIt Fintech USA 2018 Preview Show (Lend Academy), Rated: A
This year we have the LendIt Content Team on the show discussing all the different aspects of the event and how attendees can get the most out of their time at LendIt Fintech USA 2018.
Landbay Returns to Seedrs & Quickly Raises £1.2 Million in Funding (Crowdfund Insider), Rated: AAA
UK-based peer-to-peer lender Landbay has launched another equity crowdfunding campaign on Seedrs and quickly secured more than £1.2 million in funding. This news comes less than a month after the online lending platform announced it hit its £100 million in lending milestone.
Deposit rates are a joke, so investors should consider peer-to-peer lending (The Times), Rated: A
Irish investors who want a regular return on their capital but are not happy to hand their money to the banks — where deposit rates are in the doldrums — have been exploring peer-to-peer (P2P) lending.
EasyMoney launches second IFISA with higher returns (Peer2Peer Finance), Rated: A
EASYMONEY, part of Sir Stelios Haji-Ioannou’s easy family of brands, has launched a second Innovative Finance ISA (IFISA) that offers higher returns than its first tax wrapper.
The recently-launched peer-to-peer lending platform said on Saturday that its ‘balanced’ IFISA allows individuals to invest in a broader range of property-backed loans, with a target interest rate of 7.28 per cent. Loans written for the ‘balanced’ IFISA are limited to 75% loan-to-value (LTV).
Yirendai (YRD) Issues Quarterly Earnings Results (The Lincolnian Online), Rated: AAA
Yirendai (NYSE:YRD) announced its earnings results on Wednesday, March 14th. The technology company reported $1.11 EPS for the quarter, topping the consensus estimate of $0.86 by $0.25, Briefing.comreports. Yirendai had a return on equity of 66.32% and a net margin of 24.69%. The company had revenue of $280.50 million for the quarter, compared to analysts’ expectations of $244.27 million.
China’s P2P lenders brace for renewed regulatory crackdown (Financial Times), Rated AAA
Thousands of online lenders could be facing extinction as China rolls out a new licensing framework, amid complaints about a lack of clarity on how the regime will work. The peer-to-peer, or P2P, lending sector is braced for a second regulatory crackdown as a new “record filing” system kicks off in April. But with the first batch of approvals expected by the end of the month, lenders say they are still in the dark on the filing process itself.
The peer-to-peer, or P2P, lending sector is braced for a second regulatory crackdown as a new “record filing” system kicks off in April. But with the first batch of approvals expected by the end of the month, lenders say they are still in the dark on the filing process itself.
Peer-to-peer lending start-up Flender to announce €50m debt round (The Irish Times), Rated: AAA
Dublin-headquartered fintech start-up Flender, whose backers include former EY Entrepreneur of the Year award winner Mark Roden, is set to announce a €50 million debt financing round to fund its expansion.
Having secured more than £500,000 (€569,000) to fund itself through crowdfunding, Flender announced plans to raise a £2 million (€2.2 million) funding round and £20 million (€22.7 million) in leveraged debt finance last August after receiving full authorisation from the UK financial regulator to operate in Britain.
Dutch Startup Aims To Boost Earnings Of P2P Services (Cointelegraph), Rated: A
Dutch Startup “BotBird” is launching a set of services that aims to bring together different aspects of the blockchain. While the services alone are well known amongst crypto investors the set combined might make a big difference in the scene altogether.
Crypto lending took a flight last year with lending programs popping up nearly every day. The promise was simple: Invest some bitcoin or Ethereum, get the counter value returned in alt coins minted by those lending programs and earn a certain percent of interest daily.
Besides the fact that they actually focus on operating a sustainable service by offering a maximum of up to 10% monthly interest they also offer investment protection by holding your investments in Escrow. Also, their members are only allowed to invest a maximum of 5000 USD in their lending program service every 30 days.
Betting only on their Lending would do BotBird no good as lending in general is a tainted subject lately. Therefore it’s positive to see that their Lending Service is not the main service they offer. Another addition is Peer-2-Peer oriented and offers members the chance to lend directly to each other. Combined with a “Trust” system and an adjustable interest rate this P2P Lending looks very promising.
Big banks on notice as tech groups ramp up pressure (Financial Times), Rated: AAA
Technology companies are set to take a big chunk of customers from banks, as they intensify their challenge to traditional lenders across a range of mass-market financial services, say industry executives and analysts. Carlo Messina, chief executive of Intesa Sanpaolo, has told the Financial Times that Italy’s biggest bank by market capitalisation expects to lose market share to digitally focused rivals in many mainstream areas such as payments.
Carlo Messina, chief executive of Intesa Sanpaolo, has told the Financial Times that Italy’s biggest bank by market capitalisation expects to lose market share to digitally focused rivals in many mainstream areas such as payments.
SALT: Leverage Your Blockchain Assets to Secure Cash Loans (SludgeFeed), Rated: A
One such project is SALT, a lending platform that was a built to facilitate the creation of lending agreements using blockchain assets as collateral. Through the SALT platform, individuals and businesses are able to access the largely illiquid value of their blockchain assets by putting these assets up as collateral in return for fiat loans. These lending agreements are secure, as their terms are automatically enforced through smart contracts and once a loan is repaid, crypto assets are returned to the borrower. Therefore, the SALT platform is designed for individuals and businesses that are needing immediate cash infusions but are unwilling or unable to liquidate their cryptocurrency holdings.
It’s important to note that there are no origination fees, closing costs, or prepayment penalties on any fixed rate term loans arranged through the SALT platform, which is very different than traditional lending systems.
Why ZPER is a Smart Investment Choice (NewsBTC), Rated: B
Against this backdrop, P2P financing has now added a new twist with a decentralized P2P finance platform, ZPER. The platform has its basis on blockchain technology and will transcend borders and currency limitations, generating innovation in the global P2P market.
Fintech Startup Cash Suvidha Raises $ 1 M in Pre-Series A Funding (Next Billion), Rated: AAA
Delhi-based online lending platform Cash Suvidha has raised $1 Mn in a Pre-Series A funding round from Initia Holdings; Vipin Agarwal, Partner in India Industrial Growth Fund and others.
The company will use the funding to increase the loan books of the company and to further strengthen its technological infrastructure.
Peer to Peer Lending Market is Anticipated Significant Growth due to Earliest Adopters of Latest Technologies (Digital Journal), Rated: A
The ‘Global and Chinese Peer to Peer Lending Industry, 2013-2023 Market Research Report’ is a professional and in-depth study on the current state of the global Peer to Peer Lending industry with a focus on the Chinese market. The report provides key statistics on the market status of the Peer to Peer Lending manufacturers and is a valuable source of guidance and direction for companies and individuals interested in the industry.
Firstly, the report provides a basic overview of the industry including its definition, applications and manufacturing technology. Then, the report explores the international and Chinese major industry players in detail. In this part, the report presents the company profile, product specifications, capacity, production value, and 2013-2018 market shares for each company.
THE VC AND PE MARKETS IN CANADA (AllAboutAlpha), Rated: AAA
The Canadian Venture Capital and Private Equity Association (CVCA) has posted what it calls an “overview” of the VC and PE Markets in that country in 2017. It reports growth in both of those markets, although growth at distinct velocities.
In 2016 there were 542 deals in the PE space. In 2017 there were 603. In 2016 the total valuation of those deals was $13.8 billion. In 2017 nearly twice that, $26.3 billion.
Looking at exits, 2016 was a slump and 2017 was a recovery. In 2016 there were only 33 exits with a total value of $0.6 billion. In 2017, though, there were 39 exits with a total valuation of $1.7 billion. A little arithmetic indicates that the average value of one of those 2017 exits was about $43 million. The average value of one of the 2016 exits was about $18 million.
More about Private Equity
Breaking down the PE highlights by city, the paper tells us that 15% of the action (89 deals totaling $6.7 billion) went to Montreal-based companies. Companies based in Calgary and Montérègie each received a 9% share. This meant 54 deals for Calgary and 53 for Montérègie.
Breaking down the highlights by sector, 19% of the PE deals closed in industry/manufacturing. The next largest share was in information and communications technology (ICT), a 16% share. The report tells us that both of these two top sectors “have been receiving a steadily increasing share of PE deal flow since 2013 when industrial and manufacturing captured only a 14% share” and ICT got 10%.
Download the full report here.
Blockchain’s big potential in Africa (Venture Beat), Rated: AAA
At the beginning of March, some of the brightest minds from the blockchain world joined representatives from the financial, legal, and global technology industries to discuss widespread blockchain adoption. But the event wasn’t held in fintech hub London, or startup mecca San Francisco. It was in Johannesburg, South Africa, at the fourth edition of the Blockchain Africa conference hosted at the Microsoft HQ.
Emerging blockchain hubs
While still in their early growth stages compared to the crypto hubs in central and eastern Europe and Switzerland, blockchain communities in Kenya, South Africa, Nigeria, and Sudan are growing steady.
BitHub Africa , based in Nairobi, is a blockchain accelerator for local startups founded in December 2015.
Tackling real problems
To date, blockchain adoption has been sporadic across Africa, but the emerging use cases are tackling real social, economic, and political problems affecting hundreds of millions of people every day:
Combatting inflation. In Zimbabwe, which has seen rapid inflation in recent years, Bitcoin sales have soared as locals rush to protect their savings before they devalue.