The largest non bank service provider, Mr. Cooper, led a series A round into Matic Insurance; Matic is a digital insurance agency that allows homebuyers to get homeowners insurance during the mortgage process; Coverager reports Aaron Schiff, CEO of Matic said, “Mr. Cooper’s customers will benefit from Matic’s ability to expedite loan closings and make it easier for Mr. Cooper to lower their borrower’s payments for improved payment performance. 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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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
- The ten-year ticking timebomb - The Finanser
- Challenger bank teams up with direct lending fund
- Yolt announces integration with Starling Bank
- Douugh Receives Strategic Investment from Choice Financial
- SoFi Launches “Refi and Relax” Program to Combat Against Student Loan Anxiety
- AI-based Fraud Scoring Boosts Loan Approval Rate by 50% for ID Finance
- LendUp Hires First Chief Financial Officer, Announces Significant Growth Milestones
- FinTech Will Change More in the Next 5 Years Than the Last 30, Says PayPal CEO
- Jack Ma says no Ant Financial IPO anytime soon
While banks might have been a bit slow to react to online lenders they are certainly taking notice today and changing how they operate; fintech companies originated about 30 percent of unsecured consumer loans in 2016 according to TransUnion, up from 1 percent in 2010; banks have started to take notice and compete with fintech companies head on and in some cases partner with them as well; banks hold significant advantages over online lenders in cost of capital and customer acquisition costs which could erode that 30 percent market share that fintechs have built. Source.
Bank of America Merrill Lynch has formed a partnership with quant hedge fund MANA Partners that will help the bank test algorithms to stay compliant with MiFID II in Europe; the testing environment allows for traders to see if algorithms are safe and how they affect other traders; the move is seen as part of a trend by banks to cut costs and get more efficient within their trading practices. Source.
LendingPoint is a near prime lender; in the interview the LendingPoint team discusses how their algorithms work to take thousands of attributes to determine which ones are most predictive; the company is now partnering with hospitals for patients to obtain credit on the spot; LendingPoint originated around $28 million in loans in October with about 60% of applications coming through mobile devices. Source
Yixin Group Ltd., a Chinese online car lender, filed for a Hong Kong IPO looking to raise $900mn; the deal could value the fintech company at $6.5bn if shares price on the higher end; Yixin Group Ltd. is a unit of NY listed Bitauto and is backed by Baidu Inc., Tencent Holdings Ltd. and JD.com Inc. Source.
Hexindai, a Chinese fintech company listed on the Nasdaq last Friday; according to the article Chinese firms are getting pressure from investors who want to cash out; tightening regulations are also a factor; Qudian, another firm went public last month and Rong360 may be the next Chinese fintech company to go public; Oliver Wyman reports that the market size for consumer lending will expand to $620 billion by 2020 with a compound annual growth rate of 49%. 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.
Reality Shares Advisors and Amplify Trust ETF have both files with the SEC to create blockchain related vehicles; the applications are not yet complete and the SEC must rule on both before they are permitted to go ahead; CoinDesk reports that both companies will focus on companies with market capitalizations above $200mn with a six month daily trading average of $1mn. Source.