Promise Financial was previously a marketplace lender focused on providing wedding loans; it issued loans of approximately $10,000 with interest rates up to 30%; in January the firm announced a change to its name and business model citing competitive pressures as the main reason for the shift in focus; it will now sell its technology as a service to banks and is in the process of changing its name to DigiFi. Source
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Bloomberg provides insight on factors involved in a potential takeover of OnDeck Capital after rumors on Thursday that Kabbage was considering an offer to acquire the firm; it seems OnDeck's shareholders would likely veto a takeover with 45% of the company still owned by its original investors; as a private company, the structuring of the deal terms for Kabbage would also be difficult and to gain any interest from OnDeck's shareholders they would have to offer a considerable premium. Source
In November 2016 the New York Fed reported on an increase in subprime auto loan delinquencies putting the sector on watch; a report from Fitch Ratings is now showing continued deterioration in the sector during the second half of 2016 and Mizuho is reporting subprime auto loan loss rates increased to 9.1% in January 2017 from 7.9% in January 2016; Fitch reports that 60+ day subprime auto delinquencies increased to nearly 6% in the fourth quarter of 2016. Source
Lending Times reports on the business model created by Unison to improve the affordability of home ownership in the United States; the firm has developed two main products, a HomeOwner and HomeBuyer product, that are based on an investment model rather than a lending model; as a real estate investor the firm provides capital for borrowers and shares in the gain or loss of the real estate property's value; Unison and other innovative real estate businesses participated in a panel at LendIt USA 2017 titled, "The New Era of Buying & Selling a House" sharing further insight on how fintech innovation is evolving in residential real estate. Source
Alternative credit underwriting and new data solutions for broadening credit underwriting have been emerging themes in recent quarters; the Consumer Financial Protection Bureau is currently researching alternative data underwriting and many fintech companies are developing new solutions for broadening credit availability and reaching more thin file borrowers; Sasha Orloff from LendUp discusses some of the important factors for consideration in broadening credit availability in his presentation at LendIt USA 2016 highlighting some of the initiatives that are currently developing in today's market. Source