The startup will open up their new bank to 10,000 "co-founders" to begin using their banking services with hopes of a public release in 2017; the bank is looking to help people manage their money and not bombard them with product sales; founder and deputy CEO, Ricky Knox, says this is its "first step" and that it plans to "grow into a full-service bank" in 2017. 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.
To join our newsletter community please subscribe here.
As more and more fintechs disrupt the traditional banking sector, Citi is looking to embrace the new technological advances to ensure they stay relevant; the bank formed a Citi fintech division in November 2015 and stocked it with former employees of Amazon and PayPal; Citi is looking to launch a new version of their mobile app that will include voice and facial recognition to eliminate password entry; Stephen Bird, Citigroup's CEO of global consumer banking, recently told Fortune magazine, "what happens in an extinction phase is that you either rapidly adapt and new means of competition are created, or you go extinct."; the bank is looking to continue making advancements to keep up with industry tech trends. Source
Credible serves as a multi-lender marketplace, primarily for student loan borrowers; Lend Academy interviews Stephen Dash, Credible's CEO in their podcast; Credible has had great success in the market, beginning in 2012 when Stephen Dash moved to the US from Australia; through partnerships with a broad range of lenders, the company provides detailed, customized lending options; in the past year the company has expanded to personal loans and also partnered with Sallie Mae; given the current market environment Stephen Dash says the business will continue focusing primarily on its student loan customers for the near-term with a longer-term continued focus on customer experience and new loan categories. Source
At the Fintech Australia Collab/Collide 2016 event, Australia's Treasurer, Scott Morrison, cited an "enormous untapped potential" for data usage within the country's fintech industry; said the government was supportive of open aggregated financial data standards that would improve digital banking and finance solutions for consumers. Source
Consumer point of sale lender, Finomena, owns India’s most downloaded fintech app and they hope to continue gaining customers in this emerging market; led by Riddhi Mittal, formerly of Microsoft, and Abhishek Garg, a private equity investor, the company has exploded serving millennials who have little or no credit; they focus on extending credit for electronics, laptops, smartphones and furniture, which they view as good and productive categories for loans; the company has also pioneered flexible monthly installments in India and are looking to raise a Series A round soon. Source
SmartCompany is a leading Australian news site about entrepreneurship; their annual Smart50 awards for the 50 fastest-growing small businesses include several fintech companies; small business online lenders Prospa and GetCapital came in first and second this year; their revenues were AUS$22 million and AUS$4.5 million respectively; also on the list are foreign exchange/money transfer company TorX at number five and traditional asset financier Positive Lending Solutions at number six. Source
P2P property lending has been providing steady returns in the UK, according to a report from rating agency, 4thWay; since 2013, UK P2P property lenders have lent £1.6 billion with returns ranging from 2.25% to 12.7%; lenders in the category have achieved success through thorough underwriting processes with maximum loan to value ratios of 70% to 80% and most loans secured by the property. Source
Orchard discusses the November 4 week's industry activities, highlighting banks' increasing interest in online lending and fintech in its weekly snapshot; the Orchard Index, which measures aggregate US P2P/MPL consumer loan performance, reported a monthly gain of 0.24%; Yirendai led gains in publicly traded companies with a monthly return of 11.29%; Ranger Direct Lending continued to lead gains in UK publicly traded funds with a monthly gain of 6.65%; the snapshot features Earnest's recently transacted securitization and reports the most recent securitization transacted by Lendmark Funding Trust. Source
In an interview on November 7, CEO Gregory Gibb of Lufax, China's largest P2P lender and wealth management platform, said he could envision an IPO to support worldwide expansion; he did not provide further details; reporting elsewhere claims that four banks have been selected to sponsor an IPO on the Hong Kong stock exchange; when Lufax raised US$1.2 billion in January, the company was valued at $18 billion; while the market as a whole is expected to grow between 30% and 40% in 2016, Gibb noted that increasing regulation of the industry in China should give added momentum to leaders like Lufax, which Gibb expects to grow "north of 50%" in the next year. Source
On November 7, China passed data control laws that had been put on the table in August; the laws include government security checks on companies in finance, telecommunications and other critical data industries as well as mandatory in-country data storage; also, individuals will have to register with their real names on messaging services; businesses are concerned that information flow will be curtailed in industries where this is critical to be effective and corporate security checks have the potential to be invasive rather than simply regulatory; the law will go into effect next summer; some aspects of the law will need clarification over time from the government. Source