- Today’s main news: SoFi Money has launched. Lendio Employee Contribution Program funds 2,800 loans through Kiva. Goldman funds Yirendai. Nubank opens 1.5M digital accounts.
- Today’s main analysis: UK banks are closing branches faster.
- Today’s thought-provoking articles: How Goldman Sachs is transitioning into a consumer-facing bank. Europe’s IPO market is heating up. SoftBank yanks startups from Renren. The rise of P2P lending in India.
- SoFi Money wants consumers to ditch their banks. Digital banks in the U.S. have not yet caught on. SoFi Money could change that, though it remains to be seen. I’m anxious to see how this plays out.
- How Goldman is transitioning to consumer banking. Goldman’s transition goes beyond Marcus, but Marcus is a big part of their plan.
- Lendio Employee Contribution Program funds 2,800 loans in 78 countries through Kiva.
- 5 best and fast small-business loans.
- Finastra acquires Malauzai.
- LendingCorp says its fees are not hidden.
- 3 tech companies to watch in financial services.
- Finance masters degrees are not just for bankers.
- Brex gets $50 million from PayPal founders.
- LendingTree shows how home equity is being used.
- Klarna launches first out-of-home marketing campaign in U.S.
- White Oak Commercial Finance hires director of originations.
- MoneyLion appoints head of wealth management and banking.
- LendInvest increases processing fees for NACFB-registered brokers.
- UK banks are closing branches fast. This has already happened in the U.S. The UK is catching up.
- The Starling Bank roadmap.
- Lending Standards Board to extend remit to P2P lending.
- Plum seeks 850K GBP in funding through Seedrs.
- Goldman Sachs funds Yirendai.
- Hexindai reports Q4 and FY 2018 numbers.
- LexinFintech boosts installment loans.
- IPO market heats up.
- Building the digital investment bank of the future.
- Fellow Finance expands into Sweden.
- The rise of P2P lending platforms.
- P2P lending claims first victims.
- IndiaMoneyMart launches loan help hotline.
- United States
- Are you ready to ditch your bank? SoFi is betting its future on it (Fast Company) Rated: AAA
- Goldman Will Pay Big Money for Cash — Yes, Even Your Measly Savings (The Street) Rated: AAA
- Lendio Employee Contribution Program Funds 2,800 Loans in 78 Countries Through Kiva (ABC6) Rated: AAA
- 5 Best and Fast Small-Business Loans (Entrepreneur) Rated: A
- Finastra acquires Malauzai (Payment Journal) Rated: A
- Fees Not Hidden, LendingCorp Says In Challenge To FTC Suit (Law 360) Rated: A
- 5 Companies to Watch as Tech Takes Aim at the Finance Industry (PR Newswire) Rated: A
- Fintech entrepreneurs show why finance masters are not just for bankers (Financial Times) Rated: A
- New Credit Card Startup Lands $ 50 Million From PayPal Mafia And Other Investors (Forbes) Rated: A
- People are getting loans to pay for their vacations (Market Watch) Rated: A
- LendingTree Reveals How Your Neighbors Are Utilizing Equity in Their Homes (Lending Tree) Rated: A
- Klarna Launches First U.S. Out-of-Home Marketing Campaign (Klarna Email) Rated: B
- White Oak Commercial Finance Adds John Merille as Director of Originations (Markets Insider) Rated: B
- MoneyLion Appoints Jon Stevenson as New Head of Wealth Management and Banking (Business Wire) Rated: B
- United Kingdom
- LendInvest ups proc fees for NACFB registered brokers (Mortgage Strategy) Rated: AAA
- UK banks are increasingly closing branches (Business Insider) Rated: AAA
- The Starling Bank roadmap: What’s next for 2018? (Starling Bank) Rated: A
- Lending Standards Board to extend remit to P2P (Peer2Peer Finance) Rated: A
- UK Fintech Plum Returns to Seedrs: Now Seeking £850,000 in Funding (Crowdfund Insider) Rated: A
- Yirendai Obtains Institutional Funding from Goldman Sachs (PR Newswire) Rated: AAA
- Hexindai Reports Unaudited Fourth Quarter and Fiscal Year 2018 Financial Results (PR Newswire) Rated: AAA
- LexinFintech sees installment payments boosting China’s domestic consumption (Shine) Rated: A
- European Union
- Europe’s IPO market heats up, and unicorns are getting in line (CNBC) Rated: AAA
- Building the digital investment bank of the future – Interview with Simona Vaitkune, CEO of Fast Invest (EU Startups) Rated: A
- Online lender Fellow Finance expands to Sweden (Finextra) Rated: A
- SoftBank Finally Finds A Bargain (Forbes) Rated: AAA
- 20 Best Cryptocurrency Lending & Fiat Loan Blockchain Platforms To Use (Bitcoin Exchange) Rated: A
- The rise of P2P lending platforms (Business Line) Rated: AAA
- Peer-to-peer lending claims its first victims (The Ken) Rated: A
- IndiaMoneyMart Launches Loan Help Hotline for Borrowers Trapped in Payday Loan Debt (PR Newswire) Rated: A
- Latin America
- Brazil’s Nubank storms to 1.5m digital account openings (Fintech Futures) Rated: AAA
Are you ready to ditch your bank? SoFi is betting its future on it (Fast Company) Rated: AAA
At first glance, SoFi’s banking app, which launches in beta today, is no different from the existing options on the market. It comes with a debit card, enables peer-to-peer payments, and accepts mobile check deposits. The interface, like that of many banking apps, is dominated by a blue-and-white color scheme. But in the details, there is a hint of SoFi’s bigger ambitions. SoFi Money, as the product is known, sets the stage for the fintech company to become both a financial hub and lucrative recommendation engine for its 500,000-plus members.
Goldman Will Pay Big Money for Cash — Yes, Even Your Measly Savings (The Street) Rated: AAA
The Wall Street investment bank is trying to transform itself into a broader financial-services company like bigger rivals Bank of America Corp. and JPMorgan Chase & Co. So a couple years ago, Goldman expanded beyond its traditional clientele — elite corporations, big investors and the super-rich — to provide retail banking through a new website called Marcus. The company now offers both personal loans and savings accounts, with a minimum deposit of just $1. So, ordinary people can apply.
But here’s why you should take a look now: Since New York-based Goldman is trying to build up the business rapidly, it’s offering some of the highest rates on savings deposits in the U.S. – currently 1.7%. That compares with near-zero rates at the biggest retail banks, including Bank of America, JPMorgan Chase, Citigroup Inc. and Wells Fargo & Co.
Lendio Employee Contribution Program Funds 2,800 Loans in 78 Countries Through Kiva (ABC6) Rated: AAA
Lendio announced today that Lendio Gives, its employee contribution and employer matching program, has provided more than $70,000 in microloans to 2,800 underserved entrepreneurs in 78 countries through Kiva. In May, Lendio ranked 6th among Kiva’s Internal Business Groups for total fundings, with over 300 new loans funded.
Also, find out how much you can actually afford to borrow by calculating your Debt Service Coverage Ratio (DSCR). To figure out your DSCR, you simply divide your net operating income by your total debt service. With some lenders, you can get away with a 1.0 ratio; however, most lenders prefer a DSCR that shows your annual net operating income is higher than your total debt, such as a DSCR of 1.35 and above.
Finastra acquires Malauzai (Payment Journal) Rated: A
Finastra has acquired Malauzai, a provider of mobile and Internet banking solutions for community financial institutions. The deal reflects Finastra’s commitment to the US retail and business banking sectors by further enabling digital transformation for community banks and credit unions across the country.
The acquisition is built on an already successful and proven partnership between Finastra and Malauzai, which saw the latter’s digital solution integrated into Finastra’s Fusion Phoenix core banking system.
Fees Not Hidden, LendingCorp Says In Challenge To FTC Suit (Law 360) Rated: A
LendingClub Corp. asked a California federal judge Monday to toss a Federal Trade Commission suit claiming the online lender falsely promises consumers their loans come with “no hidden fees,” arguing that its origination fee is noted on its website in at least three places.
The San Francisco-based company asserts in its motion to dismiss that an origination fee, deducted when loan funds are initially disbursed, is not hidden, and the FTC knows it.
5 Companies to Watch as Tech Takes Aim at the Finance Industry (PR Newswire) Rated: A
The $8.5 trillion U.S. financial services industry is going through a dramatic transformation, with incumbents fending off upstart fintech companies that promise to disrupt their old ways of doing business.
#1 Paypal (NASDAQ: PYPL)- PayPal processed approximately $49 billion in mobile payment volume in the first quarter, which is up 52 percent from a year earlier. Mobile payments actually account for 37 percent of Paypal’s entire payment volume.
#2 QPAGOS (QPAG)-QPAGOS (QPAG) is upending this dynamic industry, with what some like to call small “super-banks” deposited on street corners, in supermarkets, or an endless number of other convenient locations.
#4 Alibaba (NYSE: BABA)-Alibaba is quickly becoming one of the world’s hottest companies thanks to its innovative approach to technology.
Fintech entrepreneurs show why finance masters are not just for bankers (Financial Times) Rated: A
Some of the world’s most successful companies have been formed by founders quitting university to nurture their start-ups, not least the Harvard dropouts Bill Gates, of Microsoft, and Mark Zuckerberg, of Facebook.
But a small yet significant number of students on masters in finance degrees do the opposite, enrolling to improve their core finance knowledge.
Maximilian Voigt applied for a place on the masters degree in financial economics at Saïd Business School at Oxford university shortly after co-founding Gründermaschine, an incubator for early stage fintech ventures in Frankfurt.
Brex, a San Francisco company that offers a corporate credit card for startups, has launched its first product and raised $50 million in new investment, bringing its total funding to $57 million. PayPal founders Max Levchin and Peter Thiel contributed to the Series B financing round, in addition to fintech venture capital firm Ribbit Capital, early Facebook investor Yuri Milner and former Visa CEO Carl Pascarella.
The startup has a new model for determining whether companies are creditworthy. Instead of focusing on founders’ personal credit history or a company’s expected profits, it looks at the amount of money a startup has in its bank account, and it sets a credit limit that’s typically 10% of that total.
People are getting loans to pay for their vacations (Market Watch) Rated: A
Affirm charges interest, but presents that total as a flat fee at the beginning of the payment process, which was more comforting than putting the big purchases on a credit card, she said.
The fee varies depending on the customer’s creditworthiness and the time period during which they plan to pay.
Phillips isn’t alone. In recent years, companies have increasingly allowed travelers to book airfare, hotels and amusement-park tickets, with the promise they’ll pay later.
LendingTree Reveals How Your Neighbors Are Utilizing Equity in Their Homes (Lending Tree) Rated: A
Home improvement tops the list of uses for home equity loans. The most common use was home improvement, at 43 percent of home equity loan requests.
Real estate investors borrow the most. Borrowers who were looking to invest in another property had the highest property values and requested loan amounts. For property investments, borrowers requested an average of $103,625.
For non-property investments, which likely include small businesses, borrowers requested $80,241.
Just over 1 percent of requests were to fund retirement. Not surprisingly, this cohort had the highest average age of 63 — 12 years above the next highest average age.
A small share accessed their home equity for emergency expenses. This group had the lowest loan amount requested of $35,747 and kept their LTV low at 51 percent.
Debt consolidators push the limits on LTV. Borrowers looking to consolidate debt had the highest LTV of 74 percent.
Klarna Launches First U.S. Out-of-Home Marketing Campaign (Klarna Email) Rated: B
Klarna is mounting its first out-of-home marketing campaign in the U.S. in three-cities. Elements of the campaign will appear in San Francisco, New York City and Columbus, Ohio, beginning the week of June 18.
White Oak Commercial Finance Adds John Merille as Director of Originations (Markets Insider) Rated: B
White Oak Commercial Finance (“WOCF”) announced today the addition of John Merille as Senior Vice President and Director of Originations.
MoneyLion Appoints Jon Stevenson as New Head of Wealth Management and Banking (Business Wire) Rated: B
MoneyLion Inc., the financial operating system revolutionizing the way Americans save, invest, borrow, and build their credit, announced today that Jon Stevenson has joined the company as the new Head of Wealth Management and Banking.
In this role, Stevenson is responsible for developing simplified, accessible solutions that address the financial challenges faced by millions of Americans every day. He will help MoneyLion Plus members create investment plans that align with their unique circumstances and goals – services traditionally reserved for high-net-worth individuals through their Financial Advisor.
LendInvest ups proc fees for NACFB registered brokers (Mortgage Strategy) Rated: AAA
Specialist lender LendInvest is upping procurement fees for NACFB registered brokers.
The lender currently offers 1 per cent proc fee as standard for bridging deals but is increasing this to 1.2 per cent exclusively for NACFB registered brokers.
LendInvest currently partners with the NACFB to run property development academies for brokers.
UK banks are increasingly closing branches (Business Insider) Rated: AAA
Here are some key statistics about branch closures:
- Branch closures are accelerating. In 2016, 630 bank branches and building societies closed. This number increased nearly 40% to 879 in 2017. Meanwhile, 670 branches have already been closed or are due to close by the end of June, suggesting that this number will probably far higher this year.
- Most branches have closed in Scotland. Not all regions in the UK have seen the same level of closures, and Scotland is currently leading the way with 368 closed branches, followed by the Southeast and Southwest, with 361 and 327, respectively. Northern Ireland, on the other hand, has only seen 44 branches close, so far. The trend toward closing branches probably depends in part on demand from customers, so branches in rural areas or with an older demographic may be more likely to stay open.
The Starling Bank roadmap: What’s next for 2018? (Starling Bank) Rated: A
This means that more Starling customers will now be able to use their smartphone and wearable devices as a fast and secure way to pay almost anywhere that contactless payments are accepted and without ever having to get their card from their wallet.
Plus new customers on Android will be able to add their sparkling new Starling debit card to their Google Pay wallet straight from our app meaning that, like our iOS customers, you can start spending within minutes of opening your account!
Lending Standards Board to extend remit to P2P (Peer2Peer Finance) Rated: A
THE LENDING Standards Board (LSB) has revealed plans to extend its Standards of Lending Practice to the peer-to-peer lending and invoice finance sectors next year.
The voluntary standards came into effect in 2017 for loans, credit cards, overdrafts and charge cards.
UK Fintech Plum Returns to Seedrs: Now Seeking £850,000 in Funding (Crowdfund Insider) Rated: A
Less than a year after securing nearly £925,000 through its first equity crowdfunding campaign on Seedrs, Plum, an artificial intelligence (AI) chatbot for personal finance, has returned to the funding portal, seeking an additional £850,000 in funding.
Yirendai Obtains Institutional Funding from Goldman Sachs (PR Newswire) Rated: AAA
Yirendai Ltd. (NYSE: YRD) (“Yirendai” or the “Company”) announced today that Goldman Sachs, a leading global investment banking firm, has provided the Company with RMB 324 million of funding for a term of 3 years.
Hexindai Reports Unaudited Fourth Quarter and Fiscal Year 2018 Financial Results (PR Newswire) Rated: AAA
Fourth Quarter of Fiscal Year 2018 Operational Highlights
- Total loan volume facilitated (1) was US$418.4 million (RMB2.7 billion) during the fourth quarter of fiscal year 2018, an increase of 236.7% from the fourth quarter of fiscal year 2017.
- Gross billing amount (net of VAT)(2) was US$31.8 million during the fourth quarter of fiscal year 2018, an increase of 231.1% from the fourth quarter of fiscal year 2017.
- Gross billing ratio (net of VAT)(3) for credit loans was 7.6% during the fourth quarter of fiscal year 2018, a decrease from 8.1% during the fourth quarter of fiscal year 2017.
- Number of borrowers (4) was 33,322 during the fourth quarter of fiscal year 2018, an increase of 285.2% from the fourth quarter of fiscal year 2017.
- Number of investors (5) was 62,039 during the fourth quarter of fiscal year 2018, an increase of 103.2% from the fourth quarter of fiscal year 2017.
Installment payments are helping to power China’s domestic consumption and sales of online lender LexinFintech Holdings Ltd’s installment finance platform Fenqile surged 220 percent during an e-commerce shopping festival.
Fenqile, translated as “Instalment Pleasure” in Chinese, lets consumers buy electronic equipment like mobile phones and consumer accessories such as handbags on credit and repay the loan in installments.
Sales of Shenzhen-based LexinFintech’s Fenqile surged 220 percent during the annual 618 e-commerce shopping festival on Monday, a major mid-year shopping event initiated by e-commerce giant JD.com.
Europe’s IPO market heats up, and unicorns are getting in line (CNBC) Rated: AAA
So far this year, 27 IPOs totaling $32.5 billion have been launched in Europe, eclipsing the 57 listings worth $8.28 billion last year, according to dealroom.co, an Amsterdam firm that tracks fast-growing companies. The big difference this year is not the number of listings, which has been fairly steady in recent years, but the size of the valuations of the companies. “There is a clear emergence of unicorns after a few years of increasing investment in the venture capital sector,” said Gilles Babinet, a French serial entrepreneur.
Swedish digital payments firm Izettle should have been the next head-turner for investors, but PayPal swooped in with an offer of $2.2 billion — twice the IPO value.
Building the digital investment bank of the future – Interview with Simona Vaitkune, CEO of Fast Invest (EU Startups) Rated: A
Fast Invest is a European P2P lending investment facilitator platform specialising in low-risk, medium-high return investment opportunities. With one successful ICO crowdsale behind and one currently ongoing, the company is now embarking on a blockchain enabled global expansion. Fast Invest is headquartered in London, with offices in Milan and Warsaw, and already employs a team of about 50 people.
We recently had the opportunity to talk with the founder and CEO, Simona Vaitkune, about the Fast Invest story so far and projects ahead.
Online lender Fellow Finance expands to Sweden (Finextra) Rated: A
Fellow Finance launches a new channel for personal financing to Swedish customers and simultaneously an opportunity for its investors to start investing in Swedish consumer loans.
SoftBank Finally Finds A Bargain (Forbes) Rated: AAA
SoftBank continues to make waves by underwriting the valuations of a growing number of turbocharged “unicorns” carrying private values north of $10 billion. It recently bought 15% of Uber at a $48 billion valuation. In partnership with GM, it paid $2.25 billion for a 19.6% stake in Cruise Automation. Masayoshi Son’s conglomerate is also reportedly looking at making a second investment in WeWork at a valuation as high as $40 billion.
In a related party deal, SoftBank and a group of other investors plucked sizable stakes in nearly 50 startups out of a NYSE-listed Chinese internet company called Renren.
20 Best Cryptocurrency Lending & Fiat Loan Blockchain Platforms To Use (Bitcoin Exchange) Rated: A
So cryptocurrency loan platforms solve the liquidity problem that the market has at this moment. But let’s check some of the most popular and known lending coins.
BeeLend-BeeLend is able to connect borrowers and lenders in different countries.
BitBond-In a similar way to BeeLend, Bitbond connects borrowers and lenders on a peer-to-peer basis, allowing users to borrow up to $25,000 dollars.
Bitfinex-This is another platform that works as an exchange but supports fiat and crypto lending.
BlockFi–BlocFi, is located in New York and offers users the possibility to borrow money against their BTC and ETH holding in 35 different US states.
Celcius-Born as an ICO that raised over $50 million dollars, it facilitates lending fiat currencies for cryptocurrency holdings as collateral.
Coincheck-The Japanese-based company has been lending cryptocurrencies since a very long time.
The rise of P2P lending platforms (Business Line) Rated: AAA
On the other side is 31-year-old Arpit Sabharwal, a Mumbai-based businessman, and lender on P2P platform Faircent. Arpit’s portfolio stands at ₹4 lakh and returns have been around 17 to 19 per cent. He is now re-allocating some of his mutual fund portfolio to the peer-to-peer lending platform.
But these platforms are not really risk-free. According to officials, the average default rate is in the range of 5-6 per cent.
According to industry insiders, there has been a near 15-20 per cent growth in loan applications and disbursements (across these platforms) on a month-on-month basis in the last one year.
While bigger players such as Faircent are said to be disbursing close to ₹2 crore a month, others like i2i Funding.com have been disbursing close to ₹60 lakh to ₹1 crore on a monthly basis.
Peer-to-peer lending claims its first victims (The Ken) Rated: A
Some of the biggest lenders on peer-to-peer lending marketplaces are staring at defaults from 20% all the way up to 50%. And RBI’s recent regulations are not going to fully fix it
IndiaMoneyMart Launches Loan Help Hotline for Borrowers Trapped in Payday Loan Debt (PR Newswire) Rated: A
Mumbai-headquartered IndiaMoneyMart has launched a Helpline for Loan applicants who are stressed and stuck in payday loan debt trap. Borrowers are welcome to reach out on +91-9082646766 between 11am to 4pm from Monday to Friday.
Brazil’s Nubank storms to 1.5m digital account openings (Fintech Futures) Rated: AAA
Brazil-based challenger Nubank has got 1.5 million customers signed up for its digital savings account (“NuConta”) over the last six months.
As reported in October, Nubank started to offer these accounts in addition to its credit card business. The move was designed to provide access to billpay, account-to-account transfers, and the ability to earn more in interest than is available with a regular savings account.
According to the bank, it has transacted around BRL 4 billion ($1 million) in its digital account so far, with over four million credit card customers on its books.