P2P lending has evolved over the last ten years, with marketplace lenders increasingly offering traditional banking products; the market's first online lender, Zopa, is taking the lead on offering traditional banking products with an announcement reporting the lender's application for UK bank licensing to offer deposit accounts and a broader range of credit products; other marketplace lenders have also expressed interest in offering deposit products including SoFi and Affirm; as P2P lenders become more integrated into the financial ecosystem, it is likely that they will offer a broader range of products with traditional banking characteristics while continuing to be market innovators. 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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Biometric authentication is becoming increasingly utilized; a few factors could help it become more integrated into mainstream technologies; an American Banker article suggests that devices need to be more compatible, consumers would need to be more accepting, multiple options need to be offered and the recognition needs to be simple; big strides have been made in 2016 however barriers to mainstream use still remain. Source
Former CIO and Group Managing Director at UBS, Oliver Bussmann, provides his insight on financial services technology and why blockchain matters in a CXOTALK interview; Oliver Bussmann was involved in the early discovery of blockchain and says one of its greatest advantages is transaction speed specifically in securities settlement where it can reduce settlement times from two to three days to seconds; Bussmann also says blockchain will be influential for insurance, trade finance, payments and the internet of things; overall he thinks regulation, consumer preferences and new technology are important factors changing the landscape and outlook for the financial services industry in the near term. Source
2016 could be the alternative finance industry's first net negative year according to AltFi; uncertainty in capital investment was a substantial factor for the first time causing a renewed focus on retail investment; CEO turnover has been a significant factor with Renaud Laplanche's resignation a catalyst for decreased investor confidence; regulators have also caused market uncertainty with new regulations potentially adding compliance burdens for alternative finance businesses; macroeconomic factors including Brexit and the US presidential election have also increased pressure on alternative finance; despite hardships, sentiment for 2017 is mostly positive with 2016 seen as only a temporary retrenchment. Source
The Consumer Financial Protection Bureau (CFPB) had a heightened presence in 2016; it was involved in governance for payday lending and marketplace lenders, it also declared a $100 million fine for Wells Fargo and was declared unconstitutional by a three-judge panel of the D.C. Circuit Court; the CFPB's structure and authority will be a factor for 2017; a marketplace lending retrenchment in 2016 also included a number of new lessons centered around governance and alternative forms of platform investment; decreased confidence and increasing platform defaults will be factors to watch for marketplace lending in 2017 while increasing credit defaults overall, and specifically in auto loans, could also be influential. Source
Fast Company looks forward to 2017 after a rough 2016 for fintechs; highlighted in their five fintechs to watch in 2017 is real estate technology firm Cadre which has closed more than $500 million in inventory; wealth management company Stash also made the top five; the company has gathered over 300,000 users and recently raised $25 million from a Series B funding round; Cross River Bank, a community bank which has close ties to the marketplace lending industry, also made the list; the company provides a banking infrastructure to many fintech firms and recently raised $28 million in new capital. Source
In our recent blog post we outline our three audiences in the USA, Europe and China; all of our global fintech conferences highlight the most innovative companies from around the world; at our March LendIt USA conference we are expecting 5,000 attendees in New York City with participants from over 40 different countries; we encourage our international attendees to book their travel plans early; read more about our global audiences in our blog post and contact LendIt to answer any questions you may have about international travel plans or visa letters. Source
Non-bank lenders in the Netherlands have been capitalizing on the global financial crisis and decreased lending from banks; Jeroen van Hessen's Dutch Mortgage Funding Company has been a leader in non-bank mortgage lending, a market that now attributes 20% of the 662 billion euros ($693 billion) mortgage market to non-bank lenders; Hessen was a market leader in the non-bank lending movement which has attracted interest from institutional investors willing to bypass traditional channels for higher returns; the effects from non-bank entrants have begun to show more significantly in the mortgage lending market where market share for mortgage originations from the region's top three banks fell below 50% for the first time in 2016; non-bank lending in the Netherlands has also increased interest from surrounding European investors familiar with non-bank platforms. Source
Hong Kong-listed Credit China FinTech Holdings led the launch of the fintech fund with 11 other partners that consist of central state-owned enterprises, provincial investment funds, trust and securities firms and private equity firms; financial gain was not the main motivation of the fund as the participants are looking at exposure to the emerging fintech space and possible partnerships in the future; "China's fintech sector was started later than the West's but is expanding at an unparalleled pace compared with the West," Credit China Executive Director Sheng Jia said at the opening ceremony. Source