Propel, the $150 million fintech venture capital company set up by Spanish bank BBVA is investing $14.1 million into InsurTech startup, Hixme; the investment was announced at Money 20/20 in Las Vegas; Propel’s sole backer is BBVA - its $150 million of funding makes it one of the biggest fintech-focused funds in the world; the company's hope is to invest in next-generation fintech companies. Jay Reinemann, managing partner at Proper Ventures, says: "Insurance has been one of the latest hot areas, it's been that way for at least a year. 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.
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Funding Circle is considering more securitization deals with demand currently high for asset-backed securities with marketplace loans; Funding Circle was the first to securitize its loans in the UK with its £130 million securitization deal in April 2016; Samir Desai of Funding Circle says the firm has plans to do more securitizations in the near-term. Source
After the government ordered regulators to step in, property developers are now finding it very hard to raise debt or equity financing for developments; regulatory bodies have been told to stop issuances on the Hong Kong stock market, the Hong Kong bond market and in the Chinese interbank bond market; this is recently after a similar freeze on the Shanghai Stock Exchange; the crackdown is also looking to curb peer-to-peer transactions related to down payments; outstanding mortgage loans are at their highest level ever, $2.4 trillion in the first half of 2016. Source
Bizfi, a small business lending platform, has hired John Donovan as its CEO; after working at Mastercard, Donovan had served in several Lending Club roles, including COO, through 2012; he has since served on various boards; Bizfi is on target to lend a cumulative $600 million by end of 2016. Source
Envestnet is an analytics company, Backbase a digital banking platform; their partnership is building upon an existing relationship and will feature a collaboration on the Open Banking Marketplace; the partnership will focus on Backbase customers being offered the suite of tools offered by Envestnet | Yodlee like know-your-customer, cash management, budgeting and a simple overview of multiple accounts from different financial institutions; according to Jouk Pleiter, CEO and Co-Founder of Backbase, “With companies like Envestnet | Yodlee on our Open Banking Marketplace, banks are able to give banking clients the user experience they deserve.” Source
Bondora has reported that it will not be opening an office in London due to post-Brexit effects; instead it will open a new office in Germany; Bondora CEO, Partel Tomberg, says he is uncertain about European market access in London; Bondora CFO says German regulators including Bafin are increasingly opening up to supporting innovation in the financial sector. Source
Bitcoin Software Addition 'SegWit' Could Make Digital Currency Faster The Bitcoin community is ready to roll out an enhancement to the digital currency's code base; SegWit (which stands for "Segregated Witness") separates the encrypting of the transaction information from the currency miner's validation signature; currency miners need extensive computing resources and time to prove that a transaction is true and valid, therefore this step has traditionally slowed down the recording of transactions; done with testing, the new SegWit feature could be released as soon as November 15th; it is considered officially adopted once 95% of the Bitcoin software community deploys the code; this could take as little as a month or two, or significantly longer.
OnDeck has partnered with institutional data consultant, Orchard, to provide data reporting for institutional investors on its platform; OnDeck is a small business lender with significant investment from institutional investors; through the partnership Orchard will manage the loan reporting for OnDeck's institutional investors and provide investors with access to investor dashboards, portfolio benchmarking, automated daily holdings reports and a variety of customized reporting options held within the Orchard for Originators data system. Source
Lending Club's CIO, Siddhartha Jajodia, sent a letter to investors on October 14 alerting them of an increase in interest rates; Lending Club says it will increase loan rates by a weighted average of 26 bps with rate changes mostly concentrated in the lower credit quality loan grades; the rate increase follows a previous weighted average interest rate increase of 135 basis points from November 2015 to June 2016; the rate increase is consistent with a lower credit quality trend observed from the platform’s borrowers as well as a higher trending rate environment in the US; additionally the firm also reported changes to credit policy standards and improvements to its collections efforts.
AirFinance has helped to expand marketplace lending capabilities in the aviation finance market through a recent launch of FlyFunder: a closed-network connecting financiers, investors, used aircraft brokers and aircraft developers.