Today, PeerIQ announced a partnership with information solutions provider TransUnion. PeerIQ is known for its data and analytics capabilities in the marketplace lending industry with a focus on securitizations. The goal with the new partnership is to provide transparency to the online lending industry through a suite of products and TransUnion’s access to originator data will play a big role in that. We spoke to PeerIQ CEO Ram Ahluwalia who said the partnership has been in the works for nearly a year.
According to the press release, they will be building an authoritative data and derived analytics solutions for the industry. While we will have to wait and see exactly what the new products entail it is not difficult to guess where this might be going. All the major credit bureaus receive data from lenders of all kinds including marketplace lenders. With this partnership PeerIQ is likely to have access to this data at least in aggregate form. They will be able to build all kinds of interesting products on top of this TransUnion data.
According to Ram Ahluwalia, CEO of PeerIQ:
Our partnership with TransUnion is a significant milestone for us, and together we intend to tackle the industry’s major challenges. Our clients are demanding through-cycle data histories, robust models and indices, cross asset-class comparisons and consensus valuation. We’re eager to meet those needs by uniting with the best data partner in the space.
To get a better idea of what this partnership means for PeerIQ and TransUnion, PeerIQ provided additional details about the partnership and why it is important.
What does this mean for the PeerIQ?
We’ve built powerful analytical tools that our clients use to quickly understand and represent their credit risk, but ultimately such tools depend on the quality and scope of the underlying data. Today, our platform offers insight into over $35B in loans across all major fintech lenders. Our TransUnion partnership affords a step-function change to that data advantage.
For the industry?
The industry needs standardization and transparency to unlock new pools of capital. There is significant variation on data representations. There are no consensus valuation, benchmarks, or loss estimates informed with pre-crisis data. These and other challenges add tremendous friction to the system. With TransUnion’s support, we are tackling these issues head on and introducing products that will reduce these frictions, increase investor confidence, and ultimately improve capital access.
When can we expect new product launches?
TransUnion has been a great partner, and we’re working steadfastly to get our first set of new products to market in early 2017. Stay tuned.
Conclusion
It’s important to remember that the success of the online lending industry is not reliant solely on the originators. The third party service providers like PeerIQ, TransUnion and others play a critical role in reducing frictions to investing. Investor confidence is crucial to a marketplace lending platform’s success and this partnership will help investors gain more transparency into the loans they are buying and bring new capabilities to the industry as a whole.
