Tuesday April 10 2018, Daily News Digest

United States

Prime Meridian Capital Management Announces New Fund Launch: The Prime Meridian Special Opportunities Fund (Benzinga), Rated: AAA

Prime Meridian Capital Management (PMCM) a Registered Investment Advisor (RIA) specializing in marketplace lending strategies across three alternative credit verticals in four funds, today introduced the Special Opportunities Fund.

The new fund, due to launch in the second quarter 2018, will invest in multiple high yielding alternative credit verticals including litigation finance, life settlements, targeted high yielding, niche real estate, small business, and consumer loans.

TransUnion Boosts Entrepreneurial Innovation with New Startup Credit Kit (Investors Hub), Rated: AAA

To meet the needs of startups and their investors, TransUnion (NYSE:TRU) today launched the Startup Credit Kit at LendIt Fintech USA 2018, giving new companies faster access to cutting-edge alternative and trended credit and fraud prevention data.

With TransUnion’s Startup Credit Kit, new businesses can more quickly gain access to depersonalized consumer credit data to better explore the market for untapped opportunities. It also helps new businesses determine the viability of their products by analyzing real-world depersonalized consumer credit data. This allows startups to focus their resources on high-potential market segments and product opportunities while allowing them to prove their concept to raise funding in the early stages of the startup lifecycle.

SoFi hires former Goldman Sachs head of mortgage securitization as new CFO (Housing Wire), Rated: AAA

Now, it looks like SoFi may be making a bigger move into securitizations by hiring the former head of mortgage securitization at Goldman Sachs as its new chief financial officer.

SoFi announced Monday that it named Michelle Gill as the company’s new CFO.

Gill comes to SoFi from TPG Sixth Street Partners, a credit firm. Gill joined TPG last yearafter a lengthy term at Goldman Sachs.

Gill spent 14 years at Goldman Sachs, eventually serving as a partner and co-heading the firm’s structured finance business.

Lending Club Ex-CEO Is Staging A Comeback With New Fintech Startup (Forbes), Rated: AAA

Online lending startup Upgrade, led by cofounder and CEO Renaud Laplanche, announced that it’s now initiating $100 million in personal loans a month, with an average loan size of about $10,000. The one-year-old company has reached $60 million in annualized revenue, Laplanche says, and by the end of 2018, he expects to hit a $100 million revenue run-rate and become profitable.

Upgrade also announced a new product called Personal Credit Line, a hybrid of a personal loan and credit card. Consumers can get approved for up to $50,000 in credit, and they can draw down on the line as needed, paying interest only on what they’ve borrowed. The credit line has a fixed length of 12 to 60 months and a fixed interest rate, and it forces consumers to pay part of the loan principal every month.

Online lender touts new personal credit line as HELOC alternative (American Banker), Rated: A

The first online lending firm Renaud Laplanche founded, LendingClub, targeted consumers with hefty credit card balances, offering them the opportunity to refinance at a lower interest rate.

In his latest venture, Laplanche hopes to lure customers before they rack up big credit card bills. Upgrade, the San Francisco-based online lender that he founded in August 2016, is rolling out a new product that is designed for folks who are anticipating big expenses but are not sure exactly how much they will need to spend or when.

THE AXIOM GROUP ANNOUNCES $ 50M IN FUNDING AVAILABLE TO PURCHASE CHARGE OFF PORTFOLIOS (Lendit), Rated: AAA

The Axiom Group announced today at LendIt Fintech USA that it has obtained $50M in capital to finance the purchase of charge off portfolios with a focus on consumer loans and credit cards, specifically in the FinTech lending space.

This increase in capital will allow The Axiom Group to pursue large portfolios and monetize those portfolios immediately for the lender/seller partners. By selling bad debt portfolios, FinTech companies can utilize the income for further lending, as well as reduce their risk associated with the challenges of collecting on charged off accounts.

Fintech lenders will struggle to regain mojo alone (Nasdaq), Rated: A

Some 13 months later LendingClub, which Sanborn has run since a mis-selling scandal cost predecessor Renaud Laplanche his job in 2016, remains just a lender. Its stock has lost around a third of its value in the past year.

On Deck’s shares are effectively flat over the same period. But boss Noah Breslow had to slash costs last year after credit losses. He now plans to boost revenue by expanding into portfolio management and loss mitigation, and finding more bank partnerships.

Privately held Social Finance has done the most to diversify, adding consumer and mortgage loans as well wealth management to student-loan refinancing.

SoFi is now the biggest player. It extended $12 billion of new loans last year, 50 percent more than erstwhile leader LendingClub, and its adjusted EBITDA is two-thirds higher at $126 million, according to the Wall Street Journal. Yet each pales in comparison to JPMorgan’s retail unit, which lends around 10 times as much and enjoys lower funding costs thanks to customer deposits.

Consumer Lending Platform Best Egg Exceeds $ 5 billion & Celebrates Fourth Birthday (Crowdfund Insider), Rated: A

Marlette Funding, LLC, the owner of consumer lending platform Best Egg, announced on Monday the year-end results and key accomplishments for first quarter 2017. According to Marlette Funding, during the past year, Best Egg experienced origination growth of 66%, significantly reduced its customer acquisition costs, and ended 2017 with three straight quarters of net income positive on a GAAP basis. Best Egg has reportedly exceeded $5 billion of prime loans and celebrated its fourth birthday. 

Launched in 2014, Marlette Funding, through its consumer brand Best Egg, describes itself as a financial technology provider on a mission to find better ways to make money accessible to allow people to “enjoy life.”

Elevate to Release First Quarter 2018 Earnings on Monday, April 30, 2018 (Business Wire), Rated: B

Elevate Credit, Inc. (“Elevate”), a leading tech-enabled provider of innovative and responsible online credit solutions for non-prime consumers, today announced that it will release its first quarter 2018 financial results after the market closes on Monday, April 30, 2018. Ken Rees, Chief Executive Officer, and Chris Lutes, Chief Financial Officer, will also host a conference call on the day of the release (April 30, 2018) at 5:00 pm ET to discuss Elevate’s financial results.

How Blockchain is Changing the Mortgage Game (Investopedia), Rated: A

While blockchain doesn’t offer a perfect remedy to the problems afflicting the industry, it does provide a model that minimizes some of them. The first major improvement the technology brings is transparency. Blockchain’s distributed ledger technology (DLT) provides two major upgrades to the current model—it decentralizes the storage of information, and it makes all transactions immediately available across all nodes of the chain. The first upgrade means that companies and lenders can no longer manipulate information or engage in shadowy practices with data, as it is shared across an entire network and not under their exclusive supervision.

Nav Launches First-of-Its-Kind Cash Flow Analysis Tool for Small Business Owners (Lendit), Rated: A

Nav, a free platform that helps small business owners build, protect and leverage their financial data, announced the launch of Business Banking Health Check, a feature to help small business owners make more informed decisions on their cash flow. Nav is the only place entrepreneurs can access their personal and business credit scores, along with cash flow insights to provide greater transparency into how lenders view their
creditworthiness and enable greater access to capital.

According to Pepperdine’s Capital Markets Report, insufficient credit profiles and cash flow are two of the primary reasons banks reject business loan applications. Nav’s platform uses these data sets to help business owners manage their fundability, while also doing legwork for lenders by matching its small business customers to their most-qualified funding options.

LENDIO ANNOUNCES LENDER TURNDOWN PROGRAM (Lendit), Rated: A

Lendio announced today at LendIt Fintech USA that it has facilitated nearly $60 million in loans through its lender turndown program.

Lendio’s lender turndown program allows lending partners to offer a marketplace of loan options to customers that do not fit the lender’s credit box; this allows lenders to turn a decline response into a potential loan offer for the small business owner.

LENDR ANNOUNCES THE LAUNCH OF ITS BUSINESS DEBIT CARD (Lendit), Rated: A

Lendr Online, LLC. announced today at LendIt Fintech USA that it is has launched a new business debit card product to service its growing client base. The ability to fund business owners in real-time via an instant access virtual Mastercard followed up with a traditional plastic card utilizing the latest in EMV chip security, will further enhance its brand and solidify Lendr’s position as a premier financial services firm.

Ocrolus Secures $ 4M in Series A Funding (Finsmes), Rated: A

Ocrolus, a New York City-based provider of solutions to analyze financial documents, raised $4m in Series A funding.

The round was led by Bullpen Capital with participation from QED Investors, Laconia Capital Group, ValueStream Ventures, RiverPark Ventures, Sam Hodges (co-founder, Funding Circle), Vince Passione (CEO, LendKey), Ram Ahluwalia (CEO, PeerIQ), Bill King (former head of securitization, JP Morgan), Hugh Nguyen (CEO, ClearServe) and Tanya Barnes (managing director, Golden Seeds), among others. In conjunction with the funding, David Arcara of Laconia Capital Group and Nick Adams of Differential Ventures will be joining Ocrolus as board members. Paul Martino of Bullpen Capital, Amias Gerety of QED Investors and Karl Antle of ValueStream Ventures will be board observers.

THINK WALLET REVEALS SCALABLE SOLUTION TO REDUCE FUNDING COST OF PERSONAL LOANS (Lendit), Rated: A

ThinkWallet.com announced today at LendIt Fintech USA that it has solved the problem many lenders currently face: Overspending to attract leads that can’t qualify for their personal loan products.

Nelnet Expands Loan Servicing Offerings To Meet Demands Of Fintech Lenders (PR Newswire), Rated: A

Nelnet (NYSE: NNI) is bringing a new servicing option to Fintech lending platforms. Nelnet Loan Servicing will leverage the experience, scale, and personnel of its existing servicing business with technology enhancements to meet the unique needs of Fintech companies with primary and backup servicing.

General Atlantic in talks on a deal with Brazil’s online lender Geru (Reuters), Rated: B

U.S. investment firm General Atlantic is in talks to buy a minority stake in closely held Brazilian online lending startup Geru Tecnologia e Serviços SA, according to two sources with knowledge of the matter.

Other investors may join General Atlantic, the sources said, adding that Geru’s partners have spent the last few weeks visiting funds in San Francisco and New York to raise about $50 million.

IDVALIDATION SHOWCASES GOVERNMENTAL VERIFICATION SOLUTIONS FOR LENDERS AT LENDIT FINTECH USA – 2018 (Lendit), Rated: B

IDValidation will be showcasing their governmental verification solutions to the lending community and Stops 100% of Synthetic Identity Theft.

IDValidation’s Consent Based SSN Verification Allows Financial Institutions Direct Access to the Main Frame Database of the Social Security Administration to Accurately Verify the Validity of a Social Security Number and Stop Synthetic Identity Theft. Toyota Financial Services has conducted a successful pilot. IDValidation has become the forerunner in providing this vital tool to the Financial World helping mitigate
Fraud & ID Theft.

LendingPoint To Accept Loan Payments and Disburse Loans via Debit Cards (Business Wire), Rated: A

Bringing a new layer of convenience to financial transactions with its customers, LendingPoint, the company working to revolutionize access to consumer credit, announced today it has entered into an agreement with TabaPay that will integrate debit cards into LendingPoint’s financing platform.

Beginning immediately, LendingPoint will allow borrowers to use debit cards for loan payments they make online or over the phone. LendingPoint will be able to verify account ownership and balance of its applicants through the TabaPay platform. Then later this year, LendingPoint will also be able to instantly disburse loans to approved borrower accounts through their debit cards, 24/7/365, or credit card payoffs. Those inbound and outbound debit-card disbursements and collections will happen instantaneously and are free for the borrower.

HARVESTING INC LAUNCHES AI BACKED CREDIT RISK SYSTEM FOR AGRICULTURE LENDERS (Lendit), Rated: A

Silicon Valley-based FinTech Social Enterprise Harvesting Inc, launches its innovative credit scoring system for financial institutions to assess farmers creditworthiness and facilitate agriculture financing .

Harvesting’s Credit Risk System is an Artificial Intelligence (AI) powered platform which leverages on traditional & alternative data sets and allows financial institutions to build, deploy and monitor credit business in the cloud, within a fraction of time & resources it takes today. It’s easy to use interface with advanced feature engineering flexibility allows credit risk manager to create best of the breed custom credit risk model for the organization on a cloud infrastructure. It allows credit risk manager of any size of financial institutions to leverage the power of AI and increase acceptance rate and reduce defaults.

FUTUREBANK DIGITAL AND API BANKING PLATFORM INTEGRATES ENTERSEKT’S SECURE CONNEKT PAYMENT FUNCTIONALITY (Lendit), Rated: B

Global Kinetic announced today at LendIt Fintech USA, that it will be integrating Entersekt’s Connekt functionality into the FutureBank platform. FutureBank’s unique ability to abstract the complexities in legacy core banking systems and customize digital channels through its technology platform helps banks and disruptive FinTech companies work together more efficiently. The growing digital banking market in the US has become vulnerable as consumers are frustrated by poorly designed mobile apps that often have weak security implementations and limited payment functionality. The FutureBank platform can now offer converged payment acceptance through Connekt.

PENSCO Launches Custodian Connect (Lendit), Rated: B

PENSCO Trust Company (“PENSCO”) announced today at LendIt Fintech USA, the launch of Custodian Connect, an API-driven capability that seamlessly connects investment platforms to PENSCO enabling uninterrupted opening and funding of an IRA from within the platform.

Spring Labs Announces World Class Industry Advisory Board to Help Build Decentralized Credit and Identity Validation Network (Lendit), Rated: B

Spring Labs, which is building the Spring Network, a blockchain-based network being designed to allow lenders, banks, and data providers to securely and efficiently exchange data with one another, today announced its founding industry advisory board. The industry advisory board comprises a group of industry leaders in finance, credit, and compliance, with members including Sheila Bair, the former Chair of the U.S. Federal Deposit Insurance Corporation (FDIC); and Nigel Morris, Co-Founder and former long-time President of Capital One, and co-founder of QED Investors, a leading investor in global financial technology companies.

This news of the industry advisory board comes on the heels of Spring Labs announcing a $14.75 million seed fundraising round, one of the largest initial venture rounds to-date for a blockchain startup.

CoinVantage Announces Release of Flagship Portfolio Accounting & Reporting System for Digital Assets (Lendit), Rated: B

Alternative Investment fund administrator MG Stover & Co. (MG Stover) announced today a partnership with software technology firm CoinVantage as part of its strategy to grow its digital asset fund administration business and deliver world class solutions to its clients.

Cross River Bank Demonstrates Key Growth, Makes Significant Personnel Hires (Lendit), Rated: B

As Cross River Bank approaches its 10th anniversary, the leader in the emerging FinTech market is demonstrating a surge in growth and surpassing significant milestones as it grows its customer base, offerings and strategic partnerships designed to revolutionize the banking infrastructure.

United Kingdom

VPC’s revenue dips in February after record January performance (Peer2Peer Finance News), Rated: AAA

VICTORY Park Capital (VPC) Specialty Lending Investments saw its total net revenue return dip to 0.81 per cent in the month of February, after reporting a record return of 1.08 per cent in January.

In its monthly market commentary, VPC said that the fall in revenue was due to a combination of factors including a “one-time fee earned in January and a shorter day count”. Capital losses were attributed to VPC’s exposure to Elevate Credit – a US-based provider of short-term loans, and securitisation residuals.

International

The P2P Lending Alternative – Crowdvouching – Will Now Run in Test Mode (Coin Telegraph), Rated: AAA

In 2017, Suretly token-holders were inspired by the idea of a crowdvouching platform – an international exchange for micro-guarantees, where people can make money by helping others borrow. In the beginning of 2018, the project made something that many other ICOs were not able to deliver: the demo version of its product. To become a guarantor (or a ‘voucher’, in the crowdvouching terminology), an individual needs to download the Suretly mobile application, where he can find borrowers’ loan orders, vouch, and get receive a sum of money in return (a fee).

On April 9, Suretly releases the first version of the new app, available to all users registered for its testing period. The borrowers’ behavior is based on the real data of past periods, and, therefore, users can learn different vouching strategies and practice them in future.

Unlike p2p lending, Suretly does not lend money directly, but rather serves as an intermediary between financial institutions, borrowers, and co-signers. Suretly users vouch for a small part of a loan sum and guarantee that the loan will be repaid in the case of a borrower’s default. Liability for each loan is divided among all vouchers and each voucher’s approval serves as an insurance of the loan. In order for the loan to be approved, the entire amount must be guaranteed by the vouchers.

RCN AT LENDIT FINTECH USA 2018 (Lendit), Rated: B

RCN announced today at LendIt Fintech USA that it will showcase how global lending through peer-to-peer technology is possible using blockchain technology and cosigned smart contracts.

With billions of people all over the world excluded from traditional banking & financial services, Sebastian Serrano (CEO), will explain the company’s successful history in Latin America since it was funded and how RCN can contribute to the world’s economy by providing credit and financial inclusion through blockchain technology and cosigned smart contracts.

Scienaptic releases significant product enhancements to its credit underwriting product ‘Ether Underwrite’ (Lendit), Rated: B

Scienaptic Systems Inc. announced today at LendIt Fintech USA that it has released an advanced version of its Credit Underwriting product, Ether Underwrite.

European Union

Can Europe cash in on the fintech revolution? (Silicon Republic), Rated: AAA

Technologies such as blockchain underpin the fintech revolution, paving the way for a whole groundswell of new start-ups that have targeted markets underserved by banks through better user interfaces and user experience (UX) as well as through digital marketing and branding.

A case in point is Revolut, a London-headquartered start-up with offices in Dublin. It turns out that cash-savvy young workers have no time for bank fees and are less forgiving of banks than older generations, and are flocking to these challenger banks.

Examples include: Zurich’s Advanon, an online platform for invoice financing for SMEs; Dublin’s CurrencyFair, which allows individuals and businesses to send funds to bank accounts worldwide; Stockholm’s Klarna, which provides online payments for e-commerce sites; and London’s Monzo, a start-up bank that has amassed more than 20,000 current-account holders and more than 500,000 people using its distinctive ‘hot coral’ cards.

Latin America

Creditas publishes report on the Brazilian lending market (Lendit), Rated: B

Creditas, the leading digital lending platform for secured loans in Latin America, has published the updated report “The disruptors paradise: Understanding the Brazilian lending space” at the Lendit USA 2018 conference.

With roughly US$ 150 billion in net interest margin, Brazilian consumer debt represents a unique opportunity to significantly increase debt availability and reduce the 30%+ banking spread. The report summarizes the reasons behind the high spread of the Brazilian ecosystem and the evolution during the last decade.

Canada

Nova Credit Partners with Transunion Canada to Expand Immigrant Financial Access across North America (Lendit), Rated: AAA

Nova Credit announced today at LendIt Fintech USA that it partnered with Transunion to serve creditworthy newcomers to Canada who may otherwise miss out on credit opportunities due to a lack of Canadian credit history.

The new product—TransUnion Global Credit Connect powered by Nova Credit—provides newcomers to Canada with a platform to import their historical credit information and have their international credit reports delivered to end-users such as banks, in a streamlined, standardized format. The foreign credit score is mapped to a Canadian equivalent score so that it can be consistently applied.

MENA

Dubai SME Expands Agreement With Finance Solutions Provider ‘Beehive’ (Albawaba Business), Rated: A

The Mohammed bin Rashid Fund (MBRF) for SME – the financial arm of Dubai SME, itself an affiliate of Dubai’s Department of Economic Development (DED) – has expanded the partnership agreement with Beehive, the MENA region’s first regulated peer-to-peer lending platform, which will cross the $50 million mark of total funding for SMEs across the platform this month.

Following a successful initial launch, MBRF and Beehive have broadened the scope of the agreement to increase the credit guarantee to AED750k and also offer Sharia Compliant Invoice Finance, a short-term finance option for businesses wishing to improve cash flow.

Asia

South Korea’s P2P loans jump 10.3% on month in March (Pulse News), Rated: AAA

The combined loans of peer-to-peer (P2P) lenders in South Korea reached almost 2.3 trillion won ($2.1 billion) last month amid burgeoning demand for the debt financing service that allows individuals to borrow or lend money online without going through an official financial institution.

According to Korea P2P Finance Association on Monday, the accumulated loans of its 65 members reached 2.296 trillion won as of end of March, up 213.6 billion won or 10.26 percent from a month ago. By sector, total loans on real estate project financing reached 768.5 billion won, real estate mortgage 611.5 billion won, and other mortgages 472.4 billion won, and credit loans 443.2 billion won. The members’ average loan interest rate was 14.32 percent.

The State Of The Nation: The highs and lows in Bank Negara’s 2017 annual report (The Edge Markets), Rated: AAA

THERE is a chance the economy will grow as much as 6% this year, according to Bank Negara Malaysia’s 2017 annual report, which was released on March 28. Not only is that ahead of 2017’s stronger-than-expected 5.9% gross domestic product growth, the central bank’s baseline projection of 5.5% growth for this year is at the higher end of the official 5% to 5.5% projected in the Economic Report 2017/2018, which was released just five months ago.

While last year’s growth beat everyone’s expectations (including the central bank’s working number of 4.57%), it is worth noting that 2016’s actual GDP growth of 4.2% was very close to the central bank’s working number of 4.1% when official projections were between 4% and 5%.

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