In 2016 government regulators became more involved in the fintech industry in a variety of ways; while new regulations were discussed across the globe, governments also got more involved in the industry through sandbox and innovation programs; China's fintech market continued to grow in 2016 with both private market funding and fintech company growth; in 2016 robo advisors and blockchain emerged with new services; the market now offers a broader range of robo advisor services and the leading asset managers have introduced their own platforms; blockchain also reported unprecedented growth with distributed ledger being used for a wider variety of solutions across all industries; all of these industry developments are expected to remain in focus for 2017. Source
After receiving FCA authorization earlier this month, ThinCats provides some insight on plans for its IFISA; Stewart Cazier, head of retail for ThinCats, says the company is planning for a 2017 release of its IFISA; Cazier also says the firm is planning a staggered rollout with registered investors receiving first priority. Source
The Federal Reserve released its Consumer Credit report for October on Wednesday; the report showed an increase of $16 billion in total consumer credit; revolving credit increased by $2.3 billion and non-revolving credit increased by $13.7 billion; the increase resulted in a seasonally adjusted annual rate of growth of 5.2%; at 5.2% the rate is the slowest since June; consumer spending was also down in October with a 0.3% increase signaling caution from consumers in spending and borrowing. Source
Overstock.com has announced it will allow customers to pay in over 40 cryptocurrencies through support from ShapeShift; the e-commerce website is the first well-known retail platform to allow coin payments beyond bitcoin; the payments are facilitated by an API built by cryptocurrency exchange ShapeShift. Source
Sofi has been leading the US fintech market with new products and record originations from its core student loan business; they recently acquired Zenbanx to offer deposit products; they are also expanding into nearly all aspects of financial services; Lend Academy talks with Mike Cagney in their podcast; Mike talks about their business model and how they are different from other top US lenders; also provides insight on their securitization funding and strategy. 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.
Lend Academy shares several companies who have announced major origination milestones across small business lending and real estate; included in the list is Kabbage, LendingHome, Funding Circle and LendingClub. 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
TCF Financial has stepped away from the auto lending business while Regions Financial and Fifth Third Bancorp are tapping the breaks according to American Banker; lenders are concerned with credit, regulation as well as low yields; some expect the trend to continue while creating an opportunity for lenders who stick around. Source
Orchard provides insight on monthly trends in P2P lending originations; uses Lending Club's publicly available standard program data for the analysis; finds October has historically been the peak month for P2P loan originations; identifies loan purpose trends for 2015 with debt consolidation notably highest in January; categories with peak lending originations in December in 2015 included major purchase, other and small business. Source