India's demonetization of the Rs 500 ($7.32) and Rs 1,000 ($14.65) continues to help online alternative finance lenders; uncertain investors are increasingly utilizing alternative finance platforms as a safer investment over gold, real estate and the stock market; invoice financing platform KredX has reported investment increases of 400% to 500%; with less of a cash focused society, P2P lenders Capital Float, Faircent, i-lend and AnyTimeLoan.in have also reported significantly higher platform investments. 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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AltFi highlights four main factors influencing alternative finance in 2017; UK regulatory developments continue to influence the market with new authorizations from the Financial Conduct Authority and ongoing consultation on the crowdfunding market; the small business lending referral scheme began in November with high expectations for increasing alternative lending originations; the launch of Marcus by Goldman Sachs is expected to affect competition and potentially set a precedent for online lending platforms lending from deposit capital; the Article 50 clause, which begins the process for the UK leaving the European Union, is still open for debate with the final action occurring in March; the March results will significantly influence the economic environment in 2017. Source
CreditEase was China's first P2P lender, founded in 2006; since its founding the firm has been expanding its services to wealth management and robo advice; Ning Tang, CreditEase founder and CEO, provides his insight on the business and the online lending industry in an interview; highlights how the company plans to expand its business lines through partnerships while also managing regulatory controls. Source
The Consumer Financial Protection Bureau (CFPB) has fined TransUnion and Equifax over $23.2 million for deceptively advertising services; the agencies reportedly advertised credit services costing customers over $200 as free and misled customers about the use of credit reports they obtained; according to the CFPB, TransUnion will pay $13.93 million to consumers and a $3 million fine while Equifax will pay $3.8 million to consumers and a $2.5 million fine. Source
UK-based mobile banking app Monese raised $10 million in funding from Anthemis Exponential Ventures, Korea Investment Partners and STE Capital; funds will be used to expand into continental Europe and to offer new credit and direct debit services; since launching in 2015 the company has signed up 40,000 customers from 179 countries who have made 1.8 million transactions; total dollars transacted is over $180 million. Source
Indonesia's Financial Services Authority has issued regulations for alternative lenders; the regulations are slightly less strict than expected; they require fintech companies to have capital of 1 billion rupiah ($74,239) when registering their business and capital of 2.5 billion rupiah ($187,210) when applying for a business license; the regulations do not set any limits on interest rates. Source
British Business Bank will be increasing its investment through P2P lenders by adding another 40 million British pound ($49.71 million) investment at Funding Circle; the investment follows some skepticism from UK taxpayers about the Bank's investment management of government funds; following the release of the Financial Conduct Authority's interim update on crowdfunding, it was reported that the British Business Bank had 85 million British pounds ($105.64 million) invested in the P2P lending industry with 60 million British pounds ($74.57 million) invested at Funding Circle; in a statement on the new investment, Funding Circle says over 5 million British pounds ($6.21 million) in interest has been earned by Funding Circle on behalf of the UK taxpayer since March 2013. Source
Crowdfund Insider talks with Ron Suber about Prosper and marketplace lending in 2016; in 2016 the firm reported decreased investment and transaction fee revenue which led to a number of new initiatives and changes; in his comments Ron Suber cited the importance of being adaptable to change; he also talked about the investment opportunity from institutional investors and the importance of securitization and a secondary market; for 2017 he expects rapid changes for the industry to continue and hopes that as the industry evolves it will result in more opportunities for borrowers, online lending platforms and the ecosystem. Source
Lend Academy provides insight on online lending performance trends in their article; details interest rate changes and trends from 2010 to present; from 2010 to 2014 returns were relatively stable; in 2015, Lending Club interest rates increased with the Fed's first rate increase in many years however the rate increases were primarily focused on the higher risk loans; capital market investors began slowing investment in 2015 and reduced investments even further after the resignation of Lending Club CEO Renaud Laplanche in May 2016; interest rates at Lending Club have been gradually rising since late 2015, specifically in the higher risk loans; rate increases were put in place to help to offset some degradation in performance; Lend Academy will explore recent vintage performance in part two. Source