Orchard's weekly snapshot highlights some new securitization activity in the online lending market; SoFi has filed for its third securitization of 2017 (SCLP 2017-2); Kabbage has filed for their first securitization of the year; in its fourth quarter 2016 earnings report, Lending Club also reported a new securitization program with quarterly issuance of up to $100 million. Source
News Roundup
This page contains an archive of the Global Newsletter summaries and the weekly fintech news roundups.
Every day the Fintech Nexus news team scours the globe for the most important stories of the day to include in our daily newsletter.
Then every Saturday we bring you our weekly news roundup of the top 10 fintech stories of the week with commentary from Peter Renton.
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Online marketplaces specializing in lead generation services play an important role in marketing lending products; ThinkWallet, a lead gen platform, provides insight on how lead gen companies are serving online lenders in the current market environment; some of their benefits include lower marketing costs, a wider pool of prospects and better quality leads; a formalized compliance process used by third party lead generation providers is also becoming a greater benefit to lenders as regulatory oversight increases specifically from the FTC and CFPB. Sponsored Blog Post
Beepi is closing after failed attempts to merge with Fair.com and DGDG; the firm is now working with Sherwood Partners to sell its assets through an assignment for the benefit of creditors process; Beepi provided an innovative online solution for used car sales; sources say the firm was paying exorbitant salaries and benefits for its employees; Sherwood Partners has not provided any details on buyers of the firm's assets however it is reported that Fair.com may be involved. Source
Funding Circle has reported cumulative originations of over 2 billion British pounds in P2P loans since its launch in 2010; it is the largest online marketplace for small business loans and has been originating approximately 100 million British pounds a month since November; its cumulative loan originations are currently just slightly less than Zopa which surpassed 2 billion British pounds in January and was the industry's first platform to launch in 2005. Source
Lending Club's fourth quarter earnings release showed a decrease in investment from retail investors; the decrease follows an increased focus from the company on banks and institutional investors as the company seeks to regain credibility following issues in 2016; while originations have remained fairly steady over the past three quarters, the percentage of investment from institutional investors increased to 74% in the fourth quarter. Source
The construction sector accounts for approximately 16% of invoices financed on the MarketInvoice platform and issues from construction company Elimco UK have uncovered some new potential risks for the sector; Elimco UK has stopped making payments to the platform; in most cases MarketInvoice as the lender would receive preferred rights to the company's payments however in the construction sector set off rights give the customer preference of payment which has caused the construction company to default with MarketInvoice; the total amount of losses reported for MarketInvoice has not been disclosed; the company says its overall loss rate is 2.4% after recoveries; the firm also says it does not have plans for data filtering by industry category since it would lead to cherry picking loans. Source
UK digital bank Monzo is nearing completion of a new funding round that will add 20 to 30 million British pounds in capital for the firm; the investment round is being led by Thrive Capital; sources also report that the firm is planning an equity crowdfunding campaign later in the year; Monzo is led by CEO Tom Blomfield and the firm was granted a UK banking license in August 2016; it currently has 100,000 users with activity driven by pre-paid Mastercards and mobile applications; the firm recently declined an acquisition offer from an incumbent bank and says it still has a lot it plans to accomplish. Source
Keogh founded Finova Financial to offer a more affordable alternative for borrowers seeking title loans; Finova offers car equity lines of credit with 12 months to pay versus the 30 days currently required by most title lenders; managed through a cloud-based system it offers easy payments and its payment terms also include early payment incentives and no late fees; the firm has now raised $52.5 million. Source
Jason talks about this year's LendIt USA event which will take place on March 6-7; while initially focusing just on online lending at its first event, LendIt USA has evolved to include a much broader agenda of fintech topics; IBM Watson will be giving a keynote on artificial intelligence this year and beyond just lending other featured topics will include blockchain, financial inclusion, wealth management and biometrics; PitchIt@LendIt has gained increased interest across the industry and this year had over 250 entries; attendees will also hear from asset allocators and learn about bank partnerships; LendIt has expanded networking within the LendIt mobile app to include 1-1 meeting functionality. Source
Student loan trader Nate Huebscher reports on the simplicity and benefits of marketplace loans versus the traditional lending sources: Sallie Mae, Discover, and the US Government; interviews Jason Jones of LendIt and Karan Mehta of Marlette Funding; Huebscher discusses the wide variation in marketplace lending models; also reports on some of the market challenges ahead that could dramatically affect the next cycle of platform results. Source