- Today’s main news: RateSetter overhauls Rolling Market product. Revolut to offer cash back in cryptocurrency. Kabbage hires new CTO. BlueVine raises $200M. iZettle expected to IPO. ETMoney launches CreditLine.
- Today’s main analysis: Are marketplace lenders, tech companies living up to the hype?
- Today’s thought-provoking articles: Revising the ICAPM to reflect effects of style investing. Cagney’s Figure to offer home equity loans, buy-lease-backs. Are banks, fintechs adversaries or partners? Singapore launches fast track for new fintech patents. China’s biggest tech unicorns stampede to go public.
- Kabbage hires new CTO.
- Cagney’s new Figure to focus on home equity loans, buy-lease-backs. AT: “Focusing on niche markets like this are the surest way to succeed in alternative lending today.”
- Revising the ICAPM to reflect effects of style investing. AT: “This is an interesting report.”
- BlueVine receives $200 million line of credit from Credit Suisse. AT: “Congratulations.”
- Senate should take up bill to help lenders see credit invisibles.
- New crop of IPOs will see skeptical investors.
- BOK Financial partners with Roostify.
- The swanky party for grads who paid off their student loans.
- Varo Money survey shows Americans trust mom with financial advice.
- Judge dismisses lawsuit ove OCC fintech charter.
- RAD Lending.
- Top 5 tiny house lenders.
- Personal Capital links with employers.
- 23rd Consumer Financial Services Institute event to discuss changing landscape of MPL.
- RateSetter overhauls Rolling Market product.
- Revolut to offer cash back in cryptocurrencies.
- Challenger banks brace for fresh wave of consolidation.
- Crypto lobby group calls for regulation based on P2P.
- Do you live in a P2P property hot spot?
- YPO Innovation Week.
- Are banks, fintech adversaries or partners?
- Do MPLs, tech companie live up to the hype?
- Financial regulators turning to the cloud.
- Chris Larsen’s internet of value.
- BFEX empowers the world for a better financial identity.
- United States
- Kabbage Hires CTO to Lead Development of Future Data-First Solutions for Small Businesses (PRNewswire) Rated: AAA
- Ex-SoFi CEO Mike Cagney Makes a Comeback With a New Blockchain-Focused Startup (Fortune) Rated: AAA
- Online Lender BlueVine Receives $ 200 Million Line of Credit from Credit Suisse (Crowdfund Insider) Rated: AAA
- Senate should take up bill to help lenders see ‘credit invisibles’ (American Banker) Rated: A
- A New Crop of Fintech IPOs Will Face Skeptical Investors (Bloomberg) Rated: A
- BOK Financial Implements Partnership With Roostify to Streamline Mortgage Process (Business Wire) Rated: A
- Inside a swanky New York party for graduates who paid off their student loans (Market Watch) Rated: A
- Mom, CFP: New Varo Money Survey Reveals That When Americans Need Financial Advice, They Come To Mama (Payment Week) Rated: A
- U.S. judge dismisses state regulators’ lawsuit over national ‘fintech’ charter (Reuters) Rated: A
- The future of lending is here, meet RAD Lending (TechBullion) Rated: A
- REVISING THE ICAPM TO REFLECT EFFECTS OF STYLE INVESTING (All About Alpha) Rated: AAA
- 5 Top Lenders You Should Consider for Tiny House Financing (Student Loan Hero) Rated: A
- Personal Capital links with employers to grow user base (Tearsheet) Rated: B
- PLI 23rd Annual Consumer Financial Services Institute, Chicago session (JDSupra) Rated: B
- United Kingdom
- RateSetter overhauls Rolling Market product (Peer2Peer Finance) Rated: AAA
- UK Fintech Startup Revolut Will Give Cash Back In Cryptocurrencies (Forbes) Rated: AAA
- UK challenger banks braced for fresh wave of consolidation (Financial Times) Rated: A
- Cryptocurrency lobby group calls for regulation based on P2P model (Peer2Peer Finance) Rated: A
- Do you live in a P2P property hotspot? (Peer2Peer Finance) Rated: A
- YPO Innovation Week Unites Innovators for the Global Fintech Summit 2018 in London (Globe Newswire) Rated: B
- China’s Biggest Tech Unicorns Stampede to Go Public (Wall Street Journal) Rated: AAA
- European Union
- iZettle to announce IPO plan early next week (Financial Times) Rated: AAA
- Banks and Fintechs: Adversaries or Partners? (Wharton) Rated: AAA
- Financial regulators turn their sights on banks’ use of cloud (Financial Times) Rated: A
- Chris Larsen: From Marketplace Lending Pioneer to Creating the New Internet of Value (Lend Academy) Rated: A
- Living Up To The Hype (Or Not) (PYMNTS) Rated: AAA
- BFEX: EMPOWERING THE WORLD WITH A BETTER FINANCIAL IDENTITY BY SHANKAR BISWAS (Bitcoinist) Rated: A
- ETMoney forays into lending with the launch of CreditLine (Medianama) Rated: AAA
- New P2P lender snares key Asian backers (Financial Review) Rated: AAA
- Singapore launches the “Fintech Fast Track” for new patents (Business Insider) Rated: AAA
Kabbage Hires CTO to Lead Development of Future Data-First Solutions for Small Businesses (PRNewswire) Rated: AAA
Kabbage, Inc., a global financial services, technology and data platform serving small businesses, appoints James Chou as its chief technology officer (CTO). With more than 20 years of successfully leading technology innovations, Chou will oversee the development of the company’s next generation of data-driven financial products and services for small businesses.
Ex-SoFi CEO Mike Cagney Makes a Comeback With a New Blockchain-Focused Startup (Fortune) Rated: AAA
The new startup plans to offer three- to 10-year home equity loans and a buy-lease-back product, the report says. In other words, it will purchase retirees’ homes and then lease them back. Many banks cut down on these types of loans following the financial crisis, but they’re starting to gain traction again due to rising home prices.
Online Lender BlueVine Receives $ 200 Million Line of Credit from Credit Suisse (Crowdfund Insider) Rated: AAA
Online lender BlueVine has secured a $200 million asset-backed revolving credit facility with Credit Suisse. Additionally, the SME focused platform said it has upped its business line of credit to $250,000. Earlier in 2018, BlueVine doubled its invoice factoring credit limit to $5 million. BlueVine’s total funded volume since founding is expected to top $1 billion in 2018.
To date, BlueVine has raised more than $400 million in equity and debt funding and is funded by Lightspeed Venture Partners, 83NORTH, Correlation Ventures, Citi Ventures, Menlo Ventures, Rakuten Fintech Fund and other private investors.
Senate should take up bill to help lenders see ‘credit invisibles’ (American Banker) Rated: A
The Credit Access and Inclusion Act of 2017 would amend the Fair Credit Reporting Act to allow the reporting of certain positive consumer credit information, such as on-time payment histories, to consumer reporting agencies. In other words, the legislation would help consumers build up their credit history for something they’re already doing.
A New Crop of Fintech IPOs Will Face Skeptical Investors (Bloomberg) Rated: A
There are now close to 30 private fintech startups with valuations at or above $1 billion, according to data platform PitchBook. A few of them are increasingly cited as possible IPO candidates. Among the most closely watched are Pimco-backed GreenSky, which has already filed paperwork with the Securities and Exchange Commission, and Dutch payments company Adyen BV, said to be considering IPO as soon as this year.
The question now is what happens to those billion-dollar-plus valuations when the public gets a look at the companies’ financials and growth projections. In the past, fintech companies haven’t fared too well. Square Inc., which is set to report earnings this week, is the exception.
BOK Financial Implements Partnership With Roostify to Streamline Mortgage Process (Business Wire) Rated: A
BOK Financial, a top-25 regional financial services company, has implemented a partnership with Roostify, a digital lending platform that gives customers more control of their home buying process while allowing loan officers to utilize the latest technology to more easily process loans.
The new digital platform is a tool that offers functionality and efficiency to customers including:
- Customers can start an application, provide documentation and follow their loan’s progress online.
- Applicants have a secure way to upload, send, and receive loan documents. Homebuyers can add other involved parties to transaction, such as the real estate agent.
- Users don’t have to guess where they are in the process – they will receive timely loan status updates.
Inside a swanky New York party for graduates who paid off their student loans (Market Watch) Rated: A
Garrido also entered a competition to win a trip to New York furnished by SoFi, the company that’s made its name refinancing student loans, including one of her own. The occasion of the competition, which Garrido ultimately won: To join other SoFi customers—or “members” in the company’s parlance—who paid off their debt to celebrate at a rooftop bar and restaurant last Thursday in the swanky William Vale hotel in Williamsburg, Brooklyn.
On one side of the student debt story are those that our college finance system has truly crippled: Borrowers who leave school with debt and no degree or graduate with degrees worth little in the labor market, or benefit less from their degree simply because of where they came from. Many in the latter group struggle to repay the debt—and not necessarily due to lack of ambition. Despite the rebounding economy, levels of student-loan delinquency remain stubbornly high.
Mom, CFP: New Varo Money Survey Reveals That When Americans Need Financial Advice, They Come To Mama (Payment Week) Rated: A
Mobile banking company Varo Money, Inc.has announced the results of their “Mom: CFP” survey.
Most American adults (60%) have a “money mentor” of some kind, and Mom is at the top of the list.
When it comes to getting financial advice, Americans will turn to their mother (23%) over a professional financial advisor (13%) or their father (19%). The figure was even higher among Millennials (35%) and women (28%). Many Americans also turn to their significant other for financial advice (23%).
A District of Columbia federal judge dismissed a lawsuit brought by state bank regulators against the U.S. Comptroller of the Currency over its proposal to offer charters that would let so-called fintech companies do business nationwide.
Since the OCC has not reached a final decision on the fintech charters, the claim of harm by the Conference of State Bank Supervisors (CSBS) was speculative, U.S. District Judge Dabney Friedrich wrote in her decision tossing out the case, issued late on Monday.
The future of lending is here, meet RAD Lending (TechBullion) Rated: A
Introducing the RAD Lendingplatform, a foundation for the financial products for the modern crypto economy, where a family of RAD credit products — personal and business loans, credit cards — will help filling the gap between crypto holdings and real-life fiat spending.
RAD Lending’s peer-to-peer (p2p) lending platform will use the benefits of the blockchain and smart contracts for its crypto secured credit products. The platform will connect fiat money investors looking for the predictable yield, with crypto-asset holders looking for loans in easily spendable fiat. By accepting crypto assets as a collateral against loans, and using the guardrails of the blockchain and smart contract technology, the platform will mitigate risks for both investors and lenders.
REVISING THE ICAPM TO REFLECT EFFECTS OF STYLE INVESTING (All About Alpha) Rated: AAA
A recent paper by Michael Stutzer, of the University of Colorado at Boulder, Leeds School of Business, suggests that the intertemporal version of the capital asset pricing model (ICAPM) needs some revision in light of the market dominance of style investors.
A more full statement of that might be: it needs revision in light of the lack of empirical support for its foundations on the one hand, and in light of the dominance of style investors on the other: and that these two revisions turn out to be one and the same.
Read the full paper here.
5 Top Lenders You Should Consider for Tiny House Financing (Student Loan Hero) Rated: A
- Upstart personal loans come with an APR range of 7.73% to 29.99%
- Borrow between $1,000 and $50,000
- Repayment terms of three or five years
- Qualify with a credit score of 620 or better
- LendingClub personal loans come with an APR range of 5.99% to 35.89%
- Borrow between $1,000 and $40,000
- Repayment terms of three or five years
- Qualify with a credit score of 600 or better
- FreedomPlus personal loans come with an APR range of 4.99% to 29.99%
- Borrow between $10,000 and $35,000
- Repayment terms of two, three, four, or five years
- Qualify with a credit score of 640 or better
- SoFi personal loans come with an APR range of 5.37% to 14.24%
- Borrow between $5,000 and $100,000
- Repayment terms of three, five, or seven years
Personal Capital links with employers to grow user base (Tearsheet) Rated: B
Digital wealth adviser Personal Capital is offering its financial advice platform to employers to grow its user base beyond its core group of investors.
The company last week inked an agreement with benefits provider Alight and investment firm AllianceBernstein to use Personal Capital’s tech platform to help participating employers select personalized 401(k) offerings for their staff members. Co-branding with Personal Capital exposes large swaths of new users to the platform.
PLI 23rd Annual Consumer Financial Services Institute, Chicago session (JDSupra) Rated: B
The second presentation of the 23rd Annual Consumer Financial Services Institute, sponsored by the Practising Law Institute, will take place in Chicago on May 7-8, 2018. I am co-chairing the event, as I have for the past 22 years.
New to the Institute this year will be a panel on the second day that I will moderate and that will discuss the rapidly changing landscape for marketplace lending and fintech.
RateSetter overhauls Rolling Market product (Peer2Peer Finance) Rated: AAA
RATESETTER has unveiled a series of changes to its Rolling Market product, removing the ability for investors to set their own rate on reinvested funds and altering how returns are paid.
Currently investments in the Rolling Market are reinvested each month, meaning the interest rate can change, but from 6 June, investments will remain matched to the same borrower until the loan is repaid, so the return will remain the same.
The rate will only change when the money is reinvested.
UK Fintech Startup Revolut Will Give Cash Back In Cryptocurrencies (Forbes) Rated: AAA
In a bold bid to further tempt young, tech-minded customers, London-based fintech startup Revolut is going to launch a debit card that gives users 1% cash back in cryptocurrencies.
UK challenger banks braced for fresh wave of consolidation (Financial Times) Rated: A
Senior executives at several smaller lenders and established high street banks said they expect a pick-up in M&A activity, after last year’s £850m takeover of Shawbrook and FirstRand’s £1.1bn purchase of Aldermore put the sector on notice for a return to dealmaking.
Cryptocurrency lobby group calls for regulation based on P2P model (Peer2Peer Finance) Rated: A
A GROUP of the UK’s leading cryptocurrency platforms want the regulator to use peer-to-peer finance legislation as a framework for their own sector.
CryptoUK, a self-regulatory trade association with eight members, has set out new plans for the Treasury to make cryptocurrency investment a regulated activity under the Financial Conduct Authority (FCA).
The plans are part of a written response by CryptoUK to the House of Commons Treasury Select Committee inquiry into digital currencies, which is currently underway.
Do you live in a P2P property hotspot? (Peer2Peer Finance) Rated: A
But as the P2P property market has expanded, a few clear trends have begun to emerge. In some parts of the country, P2P property lending is going strong. In fact, if you’re based in one of these P2P property hotspots, you may be living next door to one…
Walthamstow-Wellesley is currently offering investments in three new-build properties in E17, while Octopus Choice has loaned money on more than 30 properties in the E17, N17 and N15 areas. The Octopus platform is offering rates of between 4.49 per cent and 7.99 per cent of borrowers, with an average of four per cent in returns for investors.
Huddersfield-The West Yorkshire town of Huddersfield has been a surprising recipient of P2P property funding, largely thanks to property platform Lendy, which has financed several large property developments there. Its proximity to Manchester and Leeds means that it is likely to attract even more developer interest in the coming years.
Eastbourne-Landbay currently keeps 21 per cent of its property portfolio in the South East, with dozens of properties in and around Eastbourne.
YPO Innovation Week Unites Innovators for the Global Fintech Summit 2018 in London (Globe Newswire) Rated: B
As a part of its third annual YPO Innovation Week, YPO will host the Global Fintech Summit in London, United Kingdom, where the most dynamic global innovators will be together for a rare chance to network, overturn conventional thinking and leave inspired with the tools to infuse innovation in their companies and communities.
The Global Fintech Summit 2018 will explore the latest disruptive technologies and opportunities across the fintech landscape – including blockchain, bitcoin and robo-advice to online payments, crowdfunding, P2P lending and private equity while connecting YPO leaders from throughout Europe and across the world to share challenges, insights and needs.
China’s Biggest Tech Unicorns Stampede to Go Public (Wall Street Journal) Rated: AAA
An unprecedented wave of Chinese technology companies is accelerating plans to raise money from the global capital markets, hoping to leverage investors’ optimism about the sector and lock in buoyant stock valuations.
In recent months, at least a dozen Chinese companies with collective private valuations of roughly $500 billion have been in talks with bankers and potential investors about initial public offerings in the second half of this year or in early 2019, according to people familiar with the discussions.
iZettle to announce IPO plan early next week (Financial Times) Rated: AAA
iZettle is gearing up to announce its intention to float as early next week in what would be the largest initial public offering by a European financial technology company.
The Swedish payments and ecommerce group has been in talks with potential investors and could seek a valuation of about SKr10bn ($1.1bn) when it is expected to launch its IPO process on Tuesday next week, according to people involved in the flotation.
Banks and Fintechs: Adversaries or Partners? (Wharton) Rated: AAA
Some fintechs will aggressively go it alone and challenge the legacy banks in their most lucrative markets. And recent rule changes in Europe, which force banks to transfer closely guarded customer information to fintechs upon customer request, will add new momentum to the upstarts.
Still, the drive towards collaboration is well underway, as the following on-the-ground examples suggest.
- ICICI Bank, India’s largest private bank, and Paytm, the country’s largest digital payments platform, have jointly launched a digital credit account on the Paytm app. Paytm-ICICI Bank Postpaid gives customers access to instant micro-credit for everyday expenses — from bill payments to movie tickets. Its algorithm – from ICICI – is based on a customer’s financial and digital behavior and evaluates credit-worthiness in seconds.
- Bocom International, the investment banking arm of China’s Bank of Communications, has partnered with Hong Kong fintech firm FDT-AI to develop intelligent, personalized investment research based on bank clients’ past transactions. The hope is to offer more tailor-made investment advice.
- ING Group has partnered with Scalable Capital, a leading online wealth manager and robo-advice firm in Europe, to offer a fully digital investment solution to ING’s retail customers starting in Germany. Customers do a paperless registration in under 15 minutes. With a minimum investment of 10,000 euros they can monitor their portfolios on both Scalable Capital and ING mobile apps and online portals.
- Kabbage, a U.S.-based leading online lender, has partnered with large players such as Scotiabank, for streamlining online lending; MasterCard, for business loans through MasterCard’s network of acquirers; ING, to provide capital to small businesses; and Santander Bank, for loans to small and medium enterprises.
Financial regulators turn their sights on banks’ use of cloud (Financial Times) Rated: A
Financial regulators on both sides of the Atlantic have turned their attention to the cloud, as concerns mount over how to supervise online storage services, which hold information from the world’s biggest banks.
Global financial institutions are becoming increasingly reliant on the cloud — using it to store customer-account data and their banking systems, leading supervisors to fret about what might happen if a bank collapses.
As well as cyber risk, regulators are worried about concentrating so much information in the hands of Amazon, Google and Microsoft — the three big companies that dominate cloud provision — without the same level of supervisory oversight as banks, according to people familiar with regulatory discussions.
Chris Larsen: From Marketplace Lending Pioneer to Creating the New Internet of Value (Lend Academy) Rated: A
But Chris had an itch to start a new company, one that was based on this emerging blockchain technology.
Of course, this move proved to be prescient and his new company, which eventually became known at Ripple, has the potential to completely rewrite the rules of global commerce. In 2013 they introduced the XRP token as the vehicle to help them achieve this goal. XRP (as of this writing) is the third most valuable token with market cap of $32 billion. This is down considerably from its high in January when its market cap reached around $150 billion and briefly made Chris Larsen one of the wealthiest people in the world.
When you think about how far technology has come and the fact that information has flowed freely across borders now for 25 years it is just crazy that the way we move money internationally has barely changed since the 1980s. And while companies like Transferwise have made it more efficient and simple to send money internationally, it is still more expensive and much slower than the system that Chris Larsen envisions. He sees this new system as the second internet: the internet of value.
Living Up To The Hype (Or Not) (PYMNTS) Rated: AAA
Bitcoin, marketplace lending — pick your poison — they came to disrupt, but the jury is still out on whether they can ever achieve that goal. The global citizen and international nomad may change the nature of work around the world, but they need a “finabler” to help them do it.
And new EU regulations like GDPR may be a sea change in how business worldwide will get done, but no one seems to know if that change will come as an easy, rising tide or a tsunami of transformation.
BFEX: EMPOWERING THE WORLD WITH A BETTER FINANCIAL IDENTITY BY SHANKAR BISWAS (Bitcoinist) Rated: A
BFEX’s peer to peer lending platform is a financial market place with a difference: it is transparent, secure and credible and different from the banks with its proprietary; Decentralized Social Trust Credit Scoring that will provide millions with access money at fair rates with a new improved social identity. BFEX will create better indicators by making meaningful connections between traditional and nontraditional data where raw Credit scores are only a part of the story. Nontraditional data will allow us to look at trends in consumer behavior that completes the picture and tells a better story of the person.
ETMoney forays into lending with the launch of CreditLine (Medianama) Rated: AAA
Times Internet’s ETMoney has entered into the lending space with the launch of a new service called CreditLine on its platform, in partnership with RBL Bank.
ETMoney is a personal expense management app which allows users to invest in mutual funds, gold deposits, liquid funds etc, buy insurance, manage expenses and more. The company claims that the app has 4 million users so far and said that it has grown 20x in the last 12 months.
Paytm is reportedly trying to enter the lending space and is seeking a licence from the Reserve Bank of India (RBI) to become a peer-to-peer lending platform.
Mobikwik too is working on the launch of a lending product that will offer instant credit to customers directly from its app. Other players in this segment are like Capital Float, NeoGrowth, Paytm-backed CreditMate, CASHe, LendingKart, MoneyTap, EasySalry, Faircent, LoanMeet amongst others.
New P2P lender snares key Asian backers (Financial Review) Rated: AAA
OurMoneyMarket has just closed a $4 million funding round which saw N2N Connect, a Malaysian stock exchange-listed financial information provider backed by Japan’s financial media giant, Nikkei Inc, emerge as a key shareholder. Singapore-based YK Capital, a tech company investor, also tipped into the raising.
Run by Adam Sutherland, formerly a securitisation banker at National Australia Bank, and chief operating officer Crystal Anderson, and chaired by John Barry, NAB’s former head of debt capital markets in Asia, OurMoneyMarket has been up and running for nine months and during that time has made $1.5 million in loans.
It’s taking things slowly; there have been $95 million in applications. It has delivered early investors a 13 per cent net return. Revenue is growing at 45 per cent month on month.
Singapore launches the “Fintech Fast Track” for new patents (Business Insider) Rated: AAA
The Intellectual Property Office of Singapore (IPOS) has announced the launch of a new initiative, dubbed the Fintech Fast Track initiative, which aims to grant patents for fintech innovations at a faster pace than before. While it can traditionally take up to 2 years for a patent to be granted, this new initiative will bring that down to 6 months for new fintech solutions. The initiative includes fintech innovations related to electronic payments, investment platforms, insurance technology, blockchain, banking, security, fraud, and authentication, among others.