BBVA Compass says there is plenty of room in the market for the bank to wade into online unsecured consumer loans; Shayan Khwaja, BBVA Compass' executive director of consumer lending, told American Banker, “We’ve seen the asset class grow, and fintech has shined a light on how we can take this value proposition to the consumers. The general population is fairly savvy with digital products. They’re not just used to it, but they’re demanding it.”; the move follows Barclays and PNC who have recently launched into the same market; analysts are not as bullish on the moving citing fraud concerns and the recent spike in personal loan losses.
Betterment is looking to cater to their wealthier clients as they make portfolios more personalized; they launched the Betterment Flexible Portfolio which allows customers to shoes how assets weights are allocated; the typical Betterment client uses the asset weights set by the robo advisor, but this feature is meant to personalize the wealth clients portfolio; the move will try to help the company to position themselves as a full service firm that can cater to different levels of clientele, not just the younger investor. Source.
Online mortgage lender Lenda has plans to make the mortgage process last 30 minutes from start to finish; right now the company takes about 2 weeks to complete the process and has made more than $200mn worth or mortgages to date; Jason van den Brand, its co-founder and CEO, tells American Banker, "The big banks are working on technology that was built in the '70s. We cater to the customer who lives on their phone, laptop and tablet and shops online and compares online."; the biggest impediment is the appraisal process as that is still human intensive; the company has also been testing digital signatures by connecting via video chat with a notary. Source.
Kabbage's study shows the increased usage of mobile devices for loan applications. Source
Citi recently announced an upgrade to their mobile app to help add features and streamline the app offering; the new app features more financial management tools, you can open an account on your device and pay bills; they also added a 360 Financial View tool to give the customer a full understanding and view into all their accounts, Citi and non Citi accounts; the app is part of a broader digital strategy the bank has been pushing in recent weeks. Source.
According to the WSJ, Credit Karma isn’t receiving any proceeds or issuing new shares as part of the deal; Silver Lake will instead be purchasing shares from early investors and employees in a secondary sale; the investment values the company around $4 billion; Credit Karma generated $500 million in revenue in 2016 and according to CEO Kenneth Lin they have been growing at a double-digit pace since; Credit Karma last raised money in 2015. Source
Online consumer lender Upstart has reportedly set out to raise $100mn in their latest fundraising round; the round would put the valuation north of $500mn and upwards of $1bn; the company did not confirm the American Banker report but did say they anticipate completing a finals round in the next year; the company reach profitability last year and the value of loan transactions increased threefold according to a spokeswoman. Source.
Lennar Corp. is the largest homebuilder in the United States; they will leverage technology built by Blend to allow their customers to apply for mortgages online and through mobile devices; this will cut down significantly on the time to apply for a mortgage and Lennar hopes it will also help attract millennial buyers. Source
There is a new trend occurring at big banks, CMOs are becoming the driving force behind the change in marketing and a cleanup in digital media ads; most people still use and trust banks, even after the financial crisis and the recent bad news of big fines or scandals; recently the focus in banking has shifted to customer experience and marketers have become as big a part of the product teams as they are of the marketing teams; customers are starting to expect their experience to be more personalized, focused and more impactful to their lives; marketers have moved beyond their role of storytelling and moved into a more active role on how to drive the best experience for the different customers. Source.
Jack Henry & Associates banking division recently signed up their seventh community bank in as many months; the banks have contracted the company to use their Windows-based banking platform; Jack Briner, president and CEO California International Bank, tells Banking Technology: “When evaluating core providers, we could tell that Jack Henry & Associates would be the best partner for our bank. The advanced technology and forward momentum that Jack Henry Banking provides will give our bank the integrated and robust capabilities needed to get ahead.” Source.