deBanked spoke with ID Analytics and learned that the firm has increased its visibility into the consumer lending market to 85%; ID Analytics offers a tool which allows lenders to see where a borrower is at with other lenders which is only accomplished with this kind of visibility into the market; ID Analytics also helps lenders combat fraud by analyzing applications for credit; the company analyzes about 1 million credit applications a day. Source
Revolut is the latest company to apply for a European Banking License; their competitors Monzo and Starling Bank are already licensed; the company expects to have the license in the first half of 2018 which will allow it to offer deposit and credit services in certain markets. Source
Online lending appears to be driving increased personal loan borrowing from millennials; data from TransUnion says 4.33% of millennials obtained a personal loan in 2015 and online lenders accounted for approximately 30% of the personal loan market last year; TransUnion also reports that millennials are more conservative about credit card debt with two fewer cards on average than the previous generation. Source
Chinese credit card management firm, 51 Credit, has raised $84 million in Series C+ funding from Harvest Capital and Yintai Group, this is soon after they secured $310 million from Series C funding; the fundraising will help the company establish its own investment fund targeting fintech companies; in total the firm has raised $444 million in equity capital; according to Sun Haitao, 51 Credit CEO, the fund will be launched within a year, and will focus on asset management, data and credit services. Source
Source provides details on the Fintech Innovation Lab and its founders; notes the benefits of the Fintech Innovation Lab and includes numerous success stories; included in this year's program were Cutting Edge, Nova Credit and BehavioSec. Source
The BBC reports on the practices of internet lenders, noting that borrowers should be cautious when searching for online loans in order to protect their credit scores; TSB says some loan providers issue a hard inquiry for a loan price or quote which can harm borrowers who are only considering loan options; the bank is lobbying for more regulated practices and says, "Personal loans providers must agree never to perform a hard credit check until the customer chooses to actually purchase a loan in full knowledge of the price being offered." Source
Sunlight Financial has gained a $130 million investment from Route 66 Ventures for expansion of its residential solar systems lending business; the firm plans to develop new financing products, expand its Charlotte business center and partner with more solar installers; the firm is currently a trusted provider for a network of solar installation companies and offers its credit products through an easy to use online platform. Source
Vista Equity Partners has announced the intended acquisition of DH Corporation which it will subsequently merge with Misys to create one of the world's largest global fintech leaders. Under terms of the proposed acquisition, Vista will acquire all of the firm's outstanding debt and the equity shares of DH Corporation which trade on the Toronto stock exchange. Vista will pay C$25.50 (USD$19.15) per share for a total value of approximately C$4.8 billion (USD$3.6 billion).
The influence of DH Corporation and Misys is likely to be substantial. This week DH Corporation launched Total Lending™ Small Business a digital solution for financial institutions that is intended to improve the online bank lending process and customer experience for small businesses. In January Misys also announced a crowdlending technology solution that provides financial institutions with a platform for offering P2P lending.
These developments combined with a greater interest in fintech partnerships by banks overall and the potential regulatory implications for increased US bank lending in general are likely to influence the market landscape. This week Marlette Funding announced a workforce reduction and OnDeck has also significantly reduced its workforce following its recent earnings announcement. While exponential growth opportunities still exist for fintech companies, cost efficiencies continue to remain a central driver of demand. As broader solutions develop across the industry, it's likely that cost structures and a focus on tighter profitability forecasts will become increasingly important in order to navigate the changes ahead. Source
Online franchise business lender ApplePie Capital has announced the acquisition of Funding Solutions, LLC and the appointment of Ronald Feldman as chief development officer; Funding Solutions is a six-person franchise loan consulting firm based in Michigan and will help business and product development for the firm; supporting ApplePie Capital's brand portfolio and product strategy, Ronald Feldman will also bring significant franchise market experience from roles at FranData, Franchise America Finance and The Siegel Financial Group. Source