- Today’s main news: RateSetter surpasses 3B GBP in lending. SoFi Money bank-like offerings. LendingClub land on 2019 Bloomberg Gender-Equality Index. HeZhong International to list on Nasdaq. Robo.cash doubles investors in 2018. Kabbage to provide point-of-sale loans to Alibaba shoppers.
- Today’s main analysis: Marketplace lending securitization slowed in Q4 2018.
- Today’s thought-provoking articles: Consumer credit continues to grow. Loan default rates rose in December. India’s crowdfunding platforms gain traction with blockchain, artificial intelligence. Most competitive U.S. housing markets.
- SoFi Money bank-like services. SoFi Money has started sending out its emails to early sign-up prospects and here’s what’s on the table.
- SoFi’s next student loan securitization to focus on more MDs, fewer residents.
- LendingClub selected for Bloomberg Gender-Equity Index. Congratulations.
- Marketplace lending securitization slowed in Q4 2018. This was simply a slowdown. There were still MPL securitizations, but it’s unclear as to why the slowdown. Could it have something to do with interest rates? Probably. We’ll know for sure if we see continued declines.
- Consumer credit continues to grow. That’s a good thing.
- Loan default rates rose in December. Is this a signal that we are entering a recession? Something to keep an eye on.
- The most competitive housing markets. A LendingTree report.
- Fiserv to acquire First Data.
- Roostify enables digital mortgage solution for Glacier Bancorp.
- Joust launches digital bank for gig economy.
- Snoop Dogg invests in Klarna.
- Alternative lending among the trends to dominate business in 2019.
- 6 personal loan lenders that accept cosigners.
- What happens to robo advisors in a downturn?
- LendIt’s white paper on SMB banking.
- White Oak Healthcare Finance provides facility for senior living acquisition.
- FundThrough to work with 919 Marketing on U.S. expansion.
- Fed not an obstacle to fintech charter.
- RateSetter surpasses 3 billion GBP in lending. As the industry continues to grow, so do the largest players in the UK and the U.S. Alternative lending is still healthy.
- Celebrities to join Zopa hotline for a day.
- Tandem Bank considers IPO.
- Tide, ClearBank partner.
- One fourth of UK consumers will have neobank account in five years.
- Arbuthnot Commercial Asset-Backed Lending supports MBO of Plumbworld.
- BBVA could take over Atom Bank.
- Who accountants recommend to their clients.
- Kabbage to provide point-of-sale loans to Alibaba customers. A huge feather in the cap for Kabbage and puts them squarely in competition with Klarna and Affirm.
- White Oak Global Advisors surpasses $2.5 billion in loan originations. Congratulations.
- Klarna links with Daniel Wellington.
- Latvia: Robo.cash doubles new investors in 2018.
- China: HeZhong International to IPO on Nasdaq.
- India: Crowdfunding platforms get traction from blockchain, artificial intelligence.
- China: HeZhong sees 3,330% revenue growth.
- Europe: Investments steady but deal flow dives.
- Ireland: Money for poverty could use better systems.
- United States
- SoFi Offering Bank Like Services, But it is Still Not a Bank (Crowdfund Insider), Rated: AAA
- More MDs, fewer residents in SoFi’s next student loan securitization (Asset Securitization Report), Rated: A
- LendingClub Selected for 2019 Bloomberg Gender-Equality Index (LendingClub), Rated: AAA
- Securitization in Marketplace Lending Slowed in Q4 2018 (Lend Academy), Rated: AAA
- Fed Affirms Flexibility on Rate Hikes (PeerIQ), Rated: AAA
- Experian: Loan Default Rates Rose In Dec (PYMNTS), Rated: AAA
- Fiserv to acquire First Data for $ 22bn (Fintech Futures), Rated: A
- LendingTree Ranks Most Competitive Housing Markets (LendingTree), Rated: AAA
- Roostify Enables Digital Mortgage Solution for Glacier Bancorp (BusinessWire), Rated: A
- Joust launches a digital bank for gig-economy workers (American Banker), Rated: A
- Snoop Dogg Invests In Klarna, Sweden’s $ 2.5 Billion Unicorn (Forbes), Rated: A
- 2019 business: 5 trends that will dominate 2019 (Business Report), Rated: A
- 6 Personal Loan Lenders That Accept Cosigners (Credible), Rated: A
- What happens to robos in a downturn? (Financial Planning), Rated: A
- SMB BANKING: THE NEXT WAVE OF INNOVATION (LendIt), Rated: A
- White Oak Healthcare Finance Provides Facility to Support GMF Capital and Meridian Senior Living’s Acquisition of Rhode Island Assets (BusinessWire), Rated: B
- FundThrough Engages 919 Marketing to Fuel U.S. Expansion (PRWeb), Rated: B
- Fed not an impediment to fintechs’ charter ambitions (American Banker), Rated: B
- United Kingdom
- RateSetter Milestone: Online Lender Surpasses £3 Billion in Lending (Crowdfund Insider), Rated: AAA
- Rapper Big Narstie named among celebrities joining Zopa hotline for a day (P2P Finance News), Rated: AAA
- UK challenger bank Tandem eyes IPO (Fintech Futures), Rated: A
- Tide Collaborates With ClearBank to Transform UK SME Banking Market (Crowdfund Insider), Rated: B
- A quarter of UK consumers will have a neobank account within five years (Business Insider), Rated: A
- ARBUTHNOT COMMERCIAL ASSET BASED LENDING LTD. SUPPORTS MBO OF PLUMBWORLD WITH £3.5M STOCK ONLY FACILITY (Arbuthnot Latham), Rated: A
- BBVA name dropped in Atom Bank takeover talks (Fintech Futures), Rated: B
- Accountants Look Out (Fintech Finance), Rated: B
- HeZhong International, Chinese P2P Lender, Seeks $ 5.8 Million Nasdaq Listing (Capital Watch), Rated: AAA
- HeZhong IPO: Tempting But Risky With 3,330% Revenue Growth (Seeking Alpha), Rated: A
- European Union
- Robo.cash doubles new investors in 2018 (P2P Finance News), Rated: AAA
- Investment in European Companies Remains Steady but Deal Flow Dives (Crowdfund Insider), Rated: A
- Better systems can aid business of giving money to tackle poverty (Breaking News), Rated: A
- Kabbage to provide point-of-sale loans to Alibaba shoppers (American Banker), Rated: AAA
- White Oak Global Advisors Surpasses $ 2.5 Billion of Loan Originations (AP News), Rated: A
- Klarna links up with Daniel Wellington to allow shoppers to slice their purchase and pay over time (Klarna), Rated: B
- Blockchain, AI providing traction to India’s crowdfunding platforms (Financial Express), Rated: AAA
SoFi Offering Bank Like Services, But it is Still Not a Bank (Crowdfund Insider), Rated: AAA
- No “freakin” fees, including annual, transactional, overdraft, or any other account fees.
- Higher interest rates, a “whopping” 2.25% APY on your money.
- Free ATM usage as SoFi will reimburse the fees.
- Mobile first as your phone is your [bank] branch.
- Secure – Accounts are FDIC insured up to $1.5 million.³
More MDs, fewer residents in SoFi’s next student loan securitization (Asset Securitization Report), Rated: A
Social Finance’s next student loan securitization features higher exposure to physicians, and fewer of them are still in a residency program, according to rating agency reports.
Borrowers with medical and dental degrees are considered to be good credits in part because they have some of best employment prospects. They account for 28.8% of borrowers in the pool of collateral who have medical degrees, up from 22% for SoFi’s previous student loan securitization, according to Moody’s Investors Service.
LendingClub Selected for 2019 Bloomberg Gender-Equality Index (LendingClub), Rated: AAA
LendingClub Corporation (NYSE: LC), today announced that it is one of 230 companies selected for the 2019 Bloomberg Gender-Equality Index (GEI), which distinguishes companies committed to transparency in gender reporting and advancing women’s equality. The index doubled in size from 2018 and includes firms from 10 sectors, headquartered across 36 countries and regions. Collectively, these firms have a combined market capitalization of USD 9 trillion and globally employ more than 15 million people, of which 7 million are women. Thirteen markets are represented for the first time this year, including Argentina, China, Israel, and South Africa.
Securitization in Marketplace Lending Slowed in Q4 2018 (Lend Academy), Rated: AAA
Issuance totaled $2.6 billion, which is the slowest pace of issuance in 5 quarters and was related to market volatility according to PeerIQ. Volume decreased 44% from the prior year period and dropped 25% quarter over quarter. Total issuance in 2018 was $15.3 billion and included newer issuers Upgrade and Enova. PeerIQ expects that Upgrade and Enova will continue to participate in the securitization market going forward. While Q4 represented a drop in deals, cumulative issuance still stands at $44.5 billion across 142 deals which is a significant amount.
We should also point out that LendingClub sold more than $1 billion in CLUB certficates in 2018 which likely reduced their securitization volume in 2018.
Fed Affirms Flexibility on Rate Hikes (PeerIQ), Rated: AAA
Consumer credit continues to grow. The Fed reported that consumer credit outstanding grew at an annualized rate of 6.7% in November to $3.98 Tn. This is the third month out of the past four that consumer credit grew more than $20 Bn, for the first time in four years.
Experian: Loan Default Rates Rose In Dec (PYMNTS), Rated: AAA
According to the S&P/Experian Consumer Credit Default Indices, which the companies said in a press release represent a comprehensive measure of changes in consumer credit defaults, the composite rate rose six basis points from December to 0.89 percent. The bank card default rate rose 25 basis points to 3.34 percent, while the auto loan default rate jumped 10 basis points to 1.03 percent. The default rate on first mortgages was three basis points higher at 0.67 percent.
What’s more, S&P Dow Jones Indices and Experian said that all five of the metropolitan statistical areas showed a higher default rate in December of 2018. In Miami, it increased 41 basis points to 1.93 percent, while New York saw a 13 basis-point increase to 0.96 percent and the Chicago default rate was up four basis points to 0.88 percent. In Dallas, the default rate ticked up three basis points to 0.85 percent, while in Los Angeles it was up two basis points to 0.52 percent.
Fiserv to acquire First Data for $ 22bn (Fintech Futures), Rated: A
LendingTree Ranks Most Competitive Housing Markets (LendingTree), Rated: AAA
Denver, Los Angeles, and Portland, Ore., have the most competitive buyers in the country. Buyers in these areas have higher than average credit and the ability to put down a larger down payment.
Birmingham, Ala., Virginia Beach, Va., and Pittsburgh have the least competitive buyers in the country.Living in a less competitive market can be beneficial for buyers as it means that the path to homeownership is less challenging than it is in other parts of the country. For example, in these three areas, only 43% of mortgage shoppers had prime credit, compared to an average of 49% across the 50 largest metros in the U.S.
Roostify Enables Digital Mortgage Solution for Glacier Bancorp (BusinessWire), Rated: A
Roostify today announced that Glacier Bancorp, Inc. has launched a digital mortgage solution powered by Roostify. Glacier Bancorp, Inc. is a regional bank holding company providing commercial banking services in 104 communities through 164 banking offices in Montana, Idaho, Colorado, Utah, Washington, Wyoming and Arizona. The company holds total assets of $11.9 billion and shareholder equity of $1.5 billion.
Joust launches a digital bank for gig-economy workers (American Banker), Rated: A
The fintech startup Joust is launching a mobile banking app Tuesday designed for the 56.7 million Americans who rely on freelance income.
The product comes with a bank account, a merchant account, and a way to get quick credit. Behind it is a network of community banks that will gather the deposits the app brings in.
Snoop Dogg Invests In Klarna, Sweden’s $ 2.5 Billion Unicorn (Forbes), Rated: A
Klarna, the Swedish financial technology giant valued at $2.5 billion last year, has a new addition to its shareholder register from the most unlikely source.
Millionaire American rapper Snoop Dogg, aka Calvin Broadus, has today become a minority shareholder in the company which offers buy-now-pay-later services at 100,000 retailers in Europe and across the U.S.
2019 business: 5 trends that will dominate 2019 (Business Report), Rated: A
1. Consumers demand data control: a Deloitte report shows 71% of purchased data is … inaccurate.
2. Alternative lending will surge: It makes sense that non-bank lending will continue to grow, not only was 2018 a big year for the industry but, more importantly, 80% of small business loans are rejected.
6 Personal Loan Lenders That Accept Cosigners (Credible), Rated: A
Not all personal loan lenders allow you to add a cosigner to your physical or online application, but there are some that do. Here are six lenders that allow cosigners on their applications.
- Freedom Plus
- Laurel Road
- Lending Club
- OneMain Financial
What happens to robos in a downturn? (Financial Planning), Rated: A
As stocks soared to record highs over the past decade, robo advisors amassed billions of dollars in investable assets. But now with the onset of ominous market indicators and volatility, advisors say they are worried about how automated investment platforms will perform during a major market downturn and what that might mean for their bottom lines.
“It is a wild unknown,” says Josh Pace, president of the custodian TCA by E-Trade.
SMB BANKING: THE NEXT WAVE OF INNOVATION (LendIt), Rated: A
- How the largest banks, regional banks and community banks differ in their approaches to blending hi-tech and hi-touch customer interactions
- Who are emerging SMB-focused fintech companies and partnerships to watch
- What banking functions and features are most sought after by SMBs
- How mobile apps are being designed specifically with SMB customers in mind
- Why big data and artificial intelligence are key to integrated financial dashboard and advisory applications
FundThrough Engages 919 Marketing to Fuel U.S. Expansion (PRWeb), Rated: B
FundThrough, North America’s fastest growing automated, tech enabled invoice factoring company and a power player in the fintech SMB (small and midsized businesses) working capital space, has engaged 919 Marketing, a leading national franchise marketing agency offering content marketing and public relations services to all companies (franchise or non-franchise), to generate consistent brand awareness and accelerate expansion in the U.S. markets.
Fed not an impediment to fintechs’ charter ambitions (American Banker), Rated: B
Comptroller of the Currency Joseph Otting on Wednesday downplayed concerns that applicants for the agency’s new fintech charter may face resistance from the Federal Reserve Board.
Some in the fintech industry are raising alarm that the Fed may balk at allowing holders of the new special-purpose charter into the payments system, which could reduce the overall value of the charter.
RateSetter Milestone: Online Lender Surpasses £3 Billion in Lending (Crowdfund Insider), Rated: AAA
UK based peer-to-peer lender RateSetter announced on Tuesday it has surpassed £3 billion in online lending. RateSetter reported that the milestone follows a successful year, with the lender originating more than £700 million of new lending and active loans under management grew to £820 million.
RateSetter also revealed that more than 600,000 customers have used its lending platform to invest or borrow. To date, investors have lent £1.9 billion to individuals and £1.1 billion to businesses. A total of £2.2 billion has been repaid by borrowers, generating returns of £120 million for RateSetter investors, who have enjoyed an average annual interest rate of 4.4% per year since RateSetter’s launch in 2010.
Rapper Big Narstie named among celebrities joining Zopa hotline for a day (P2P Finance News), Rated: AAA
PEER-TO-PEER lender Zopa is making four celebrities honorary ‘Zopians’ for a day next week.
It has launched a “FeelGood Hotline” to banish the January blues that will be staffed by pop star and TV host Frankie Bridge, broadcaster Lauren Laverne and rapper Big Narstie (pictured) on 23 January.
Boxing icon Frank Bruno will also be on the hotline.
UK challenger bank Tandem eyes IPO (Fintech Futures), Rated: A
UK digital challenger bank Tandem has got its young beating heart set on an IPO within the next few years.
In a brief written and video update, it looks to the future and the past. For example, it cites its recent $15 million investment from Hong Kong for Asian market expansion plans.
Tide Collaborates With ClearBank to Transform UK SME Banking Market (Crowdfund Insider), Rated: B
Tide, a UK-based SME challenger banking, announced on Monday it has formed a new partnership with ClearBank to help transform the UK SME banking market.
Tide reported that through its support, ClearBank has applied for a grant from Pool A of the Capability and Innovation Fund that forms part of the £775 million RBS Alternative Remedies Package, a government-backed competition.
A quarter of UK consumers will have a neobank account within five years (Business Insider), Rated: A
Currently, 9% of Brits, equating to 4.5 million people, have opened an account with a digital-only bank, according to the study. By 2024, a further 16% of the population, or 8.5 million people, intend to do the same.
ARBUTHNOT COMMERCIAL ASSET BASED LENDING LTD. SUPPORTS MBO OF PLUMBWORLD WITH £3.5M STOCK ONLY FACILITY (Arbuthnot Latham), Rated: A
Arbuthnot Commercial Asset Based Lending Ltd. (Arbuthnot Commercial ABL) is pleased to announce the completion of a bespoke £3.5m transaction to support the management buy-out of Online Home Retail Limited (trading as www.plumbworld.co.uk), one of the UK’s leading e-commerce retailer of bathroom related products, from Grafton Group PLC, an international distributor of building materials.
BBVA name dropped in Atom Bank takeover talks (Fintech Futures), Rated: B
Sky News has learnt that Atom is in talks to appoint Citi to advise its board on options for the business.
Accountants Look Out (Fintech Finance), Rated: B
Research1 from business finance company MarketInvoice reveals that UK accountants are most likely to refer their clients to banks, with invoice finance as the second most popular lender of choice.
Two thirds (66%) of accountants surveyed said that they do recommend external finance providers to their clients. Whilst these recommendations will be based on the need of any given business, they also indicated their preferred source of funding. Half (50.8%) indicated that they would recommend their clients speak with a bank about their finance needs. Interestingly, more than a third (36.3%) are recommending an invoice finance provider ahead of a business loan provider (33.66%).
HeZhong International, Chinese P2P Lender, Seeks $ 5.8 Million Nasdaq Listing (Capital Watch), Rated: AAA
The Shenzhen company hopes to raise up to $5.8 million in New York under the symbol “HZ,” according to its prospectus filed with the U.S. Securities and Exchange Commission.
On its online platform, HeZhong matches borrowers and investors, facilitating mostly consumer loans ranging from $437 to $2,200. It also issues car loans in the amounts ranging between $2,900 and $29,200.
HeZhong IPO: Tempting But Risky With 3,330% Revenue Growth (Seeking Alpha), Rated: A
- Based in Shenzhen, China, HeZhong offers an online peer-to-peer lending marketplace, providing consumer and automobile loans to the Chinese borrowers and risk-adjusted returns to the investors.
- Certain investors will believe that the interest rates seem quite appealing. Annual interest rates are between 8% and 15%, and usual tenures are from 7 days to 360 days.
- The year 2018 was also great in terms of profitability. The company went from reporting losses from operations of -$1.1 million to report operating profit of $5.6 million.
Robo.cash doubles new investors in 2018 (P2P Finance News), Rated: AAA
LATVIAN peer-to-peer lending platform Robo.cash has reported that it doubled its investor base in 2018 as it expanded its product range and scaled up its lending.
The P2P payday lender said the total volume of investments on its platform hit €5m (£4.45m) after a strong year, representing 93 per cent growth. Meanwhile, it attracted 3,200 new investors, twice the number in 2017, with the majority coming from Germany.
Investment in European Companies Remains Steady but Deal Flow Dives (Crowdfund Insider), Rated: A
Dow Jones has published their Q4 VentureSource report today and while investment in European companies “held steady” deal flow dropped.
The report indicates that the number of deals in Q4 stood at 729. In comparison to the prior quarter, it dipped slightly from 738. When you compare year over year quarters the discrepancy is greater as Q4 2017 delivered 865 separate deals.
In total amount raised, Q4 2018 came in at € 5.19 billion. This is a decline from Q3 at €4.98 billion. But year over year the amount was down as well as Q4 2017 saw € 5.6 billion raised.
Better systems can aid business of giving money to tackle poverty (Breaking News), Rated: A
On a visit to Ethiopia last week, the Taoiseach chose to visit one of the most impoverished areas of the world and witness, first hand, profound poverty.
While there, he was introduced to a woman who had bought four potentially life-saving sheep with a micro-loan provided by Irish Aid.
Irish Aid is operated by the Department of Foreign Affairs. It is, effectively, managed on behalf of us citizens.
Blockchain, AI providing traction to India’s crowdfunding platforms (Financial Express), Rated: AAA
Although crowdfunding in India is at a nascent stage, with only 15 notable crowdfunding platforms (CFPs), the concept holds immense potential for the country’s startup ecosystem.
A World Bank report states crowdfunding has emerged as a multi-billion dollar global industry, and is expected have a volume of $300 billion by 2030.