The CFPB asked for more details on which companies consumers use to obtain a free credit score; the agency is looking to help consumers better understand their credit scores and how to potentially improve them; they also want to understand how behavior changes after seeing a free credit score; comments are due by February 12, 2018. Source.
A recent report titled Three Myths About Peer-to-Peer Loans by the Federal Reserve of Cleveland makes some dubious claims about the marketplace lending sector; Lend Academy shares information from the report and questions the data provided. Source
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.
With continued low bank rates Chinese consumers have flocked to new fintech firms that offer better returns; lower income individuals use Yu’E Bao money market fund and high net worth individuals use wealth management products; this has helped younger more savvy investors to abandon stocks and real estate, though regulations in China can always change quickly. 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.
PayPal has launched a new service, Money Pools, to allow users to create fundraising pages where their network can contribute; the pages are similar to other crowdfunding sites but with a greater emphasis on social media; the thought is this can become another revenue generating product for PayPal, though they currently are not charging for the use of Money Pools. Source.
Ravi Menon, managing director of the Monetary Authority of Singapore (MAS) spoke about the MAS completing their first blockchain pilot covering interbank payments; Menon stated, "The killer app is really to go cross-border. If we can make a blockchain-based system support payments from one country to another, that could be potentially transformative in bringing costs down."; he also spoke about the increasing understanding of fintech by CEOs of major banks and how the MAS supports partnerships between banks and fintechs. Source
Generally banks have the customers but are working with an old tech infrastructure; conversely, fintechs have the new tech, but lack the customers; Tearsheet shares data on how much it costs for large banks and fintech companies to acquire customers and why partnerships often make sense; one personal finance app and lender that is reporting low cost of customer acquisition is MoneyLion; the cost to acquire a customer for them is $5 or less. Source
TrueAccord provides a data-driven debt collection platform; the company uses machine learning to communicate with consumers using the right channel at the right time; Ohad Samet, Chief Executive Officer stated, “It was the personal experience of dealing with a debt collector that made me realize the traditional collections industry was ripe for disruption with technology innovation and a more human approach. With changing consumer preferences, strong regulatory support for innovation, and clients who understand a customer-focused collection process is good for their business, we're experiencing tremendous demand from the market. We are seizing this opportunity to use machine learning to humanize debt collection for good.”; The round was led by Arbor Ventures Fund. Source
- Real Estate Fintech Firm Unison Announces 2018 Expansion Plans
- Canopy Receives Further Investment from Round Hill Capital
- Lendable hits £100m lending landmark
- PeerStreet Continues to Expand Resources and Technology Services to Lenders
- AutoGravity Puts More Than One-Million Users In The Driver's Seat, Growing More Than Ten-Fold In Just One Year
- Fundation Purchases Select Assets from Able Lending to Enhance Partnership Strategy