With demonetization in full swing, Capital Float has expanded their loan offerings to include businesses with card machines; the new program will allow vendors to take out a loan of up to 200% of their sales; loans will then be paid back based on a small fee from each transaction; the company expects a surge in loans based upon the new government program to remove large cash notes. Source
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Prime Minister Modi's plan to demonetize has put a lot of strain on much of Indian society, now the ICICI Bank is looking to ease that burden by helping to make 100 villages cashless in 100 days; the plan was born out of a successful program that made one village cashless in 2015; the 100 villages will be spread throughout the country and will help 10,000 people overall; local people will be able to use their mobile phones to transact with merchants and banks. Source
The Federal Reserve has announced it will hold an industry conference on financial innovation, titled, "Financial Innovation: Online Lending to Households and Small Businesses"; the event will take place on December 2 and will involve academics, industry participants and policymakers; discussions will focus on academic research and the evolving online lending industry. Source
The central bank of Indonesia has opened a fintech office; the central bank will use the fintech office to maintain its regulatory oversight while also providing support for new fintech startups; it plans to collect information on the industry for regulatory development; it will also facilitate the development of fintech companies and their introduction to the economy both in Indonesia and globally. Source
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Goldman Sachs and Santander have announced they are leaving the R3 Blockchain Consortium; Goldman Sachs was one of the 12 founding members of the Consortium; the reasoning behind the move is unknown however speculators believe it is likely due to solicitation of $150 million from members. Source
In Europe, slowing venture capital investment in fintech has caused increased reliance from the industry on traditional banks; as Brexit concerns have affected the fintech industry, traditional banks have increased their investment with more corporate and strategic participation in venture capital deals in Europe for the third quarter of 2016; over the last five quarters significant large bank investors in fintech have included Citigroup Inc., Banco Santander SA and Goldman Sachs Group Inc.; as the European market evolves with a number of regional factors continuing to affect both fintech companies and banks it is likely that more banking partnerships and fintech acquisitions will occur. Source
While fintech companies have focused on speeding up the lending process to small businesses, the IRS's continued use of fax machines continues to slow down the lending process when borrowing from traditional institutions; in an article from American Banker, the cumbersome process of getting a tax transcript from the IRS is outlined; when customers need capital on short notice they are often left with higher financing costs; Representative Patrick McHenry recently introduced the IRS Data Verification Modernization Act that aims to provide near-real-time communication of information which may level the playing field across lenders. Source
Germany's Federal Ministry of Finance has published a report on the emerging fintech sector; the report finds 433 fintech companies with 346 of the companies actively in business; robo advice had the highest annual growth rate; of the 433 firms, 13 were crowdlending companies with nine of the platforms actively in business; other highlights include transaction volume by segment and industry growth rates. Source
The Consumer Financial Protection Bureau (CFPB) will appeal the court's unconstitutional ruling in the case of CFPB v. PHH in which PHH argued the CFPB's authoritative powers were too broad following enforcement actions that resulted in penalties primarily for referring consumers to mortgage insurers for compensation; the CFPB is requesting that the case be heard by all judges in the D.C. Circuit Court of Appeals rather than a panel of only three judges which provided the October ruling; if the verdict in the case is unchanged, the president will still be able to replace the CFPB director at his discretion; it's likely that Director Cordray could be replaced by President-Elect Donald Trump given his plans for Dodd-Frank. Source