A new report from Equiniti found that 30 percent of millennials borrowed more than $1300 in the past year; borrowing has increased by 17 percent since 2015; 44 percent prefer to search for a loan on their phones and 47 percent said they would be willing to borrow from an unfamiliar lender; this is clearly encouraging for fintech firms but also shows challenges remain as millennials look for the cheapest, quickest way for funds. Source.
P2PGI entered into an agreement to sell over $1bn worth of US consumer loans; the sale will reduce the funds net asset value (NAV) by less than 1 percent and effect their leverage & hedging requirement; the move is part of a broader strategy the fund laid out in September. Source.
The KPMG Pulse of Fintech Q3 report pointed to 274 deals worth over $8bn in investment; the hottest areas of investment include artificial intelligence, insurtech, regtech and blockchain; the three biggest countries come as no surprise with the US, China and the UK dominating their respective regions. Source.
Revolut is the latest company to apply for a European Banking License; their competitors Monzo and Starling Bank are already licensed; the company expects to have the license in the first half of 2018 which will allow it to offer deposit and credit services in certain markets. Source
UK based banking app Revolut has decided to build their own in-house processor after their provider experienced a number of outages; Revolut follows fellow banking app Monzo in making the move to an in-house processor because of outages; GPS, the processor, serves a number of fintech companies and digital banking apps. Source.
Simon Champ is a pioneer in the lending space creating the first publicly traded investment vehicle; P2PGI launched in may of 2014 in a £200 million IPO and they have now raised a total of £900 million; Champ shares how he first became interested in this space and how much the industry has changed since the fund first launched. Source
International money transfer firm TransferWise announced a $280mn series E raise; investors in the round include Old Mutual Global Investors, IVP, Sapphire Ventures, Mitsui & Co., Andreessen Horowitz, Baillie Gifford and Richard Branson; they plan to use the funds for expansion to the Asia Pacific region by having a full set of products available in India and opening offices in Tokyo and Sydney. Source.
Citigroup will provide funding for mortgages which will eventually be securitized and sold; the terms of the deal were not disclosed; LendInvest has continued to grow loan volumes with 2017 volume at 500 million pounds. Source
Volkswagen is preparing an application for a UK banking license so they can continue car financing after the UK leaves the EU; the move will help the company be prepared as negotiations for Brexit continue; they currently are able to offer loans by passporting their license in Germany to the UK, but with Brexit occurring those rules might change; their loan book in the UK is $19.6bn and if they were to open a retail bank they anticipate about 10 percent of funding to be customer deposits. Source.
HSBC intends to launch a new product in 2018 to address problems they see in the automated investment market; the new product is dubbed robo-advising 2.0 by Dean Butler, HSBC’s head of retail wealth; it will provide holistic financial advice and will eventually include recommendations for other products such as pensions and insurance. Source