- Today’s main news: SoFi helps Pro.com make home improvement loans. BlueVine raises $102.5M. OCC, FDIC propose Madden fixes. Twino CEO stands down, platform hits 1B euro in loans issued. Funding Xchange raises $10.4M.
- Today’s main analysis: LexinFintech lending business analysis (A MUST-READ).
- Today’s thought-provoking articles: Fed rate inversion. 10 cities that cost money to commute. P2P lending losses from 2017 and 2018.
- SoFi provides home improvement loans for Pro.com. This looks like a good partnership.
- BlueVine raises $102.5 million for banking services. This is a welcome service, and a new milestone in online banking because most digital banks target consumers. As far as I know, this is the only online banking service specifically targeting small businesses.
- FT Partners advises BlueVine on Series F round.
- The OCC, FDIC propose Madden fixes. If these pass, it will begin a new era in online lending.
- The Fed rate inversion. A PeerIQ analysis. Plus, some interesting rundowns on digital wallets and Goldman Sachs’ robo-advisor.
- 10 worst cities for commutes. A LendingTree analysis, and well worth the read. The report was published in October, but Business Insider reported on it recently.
- Vouch adds growth funding insurance for startups.
- 5 ways to invest in real estate online.
- ArborCrowd investors see strong returns on Quarry Station Apartments.
- How crowdfunding has changed the real estate investing game.
- Fintech is the fourth platform on the banking tech stack. An interesting read.
- Balboa survey reveals small business owners anticipate strong Black Friday.
- American Financial Exchange launches blockchain lending product.
- 5 alternatives to traditional savings.
- Alchemy partners with Plaid on loan decisioning, fraud detection.
- Funding Xchange raises $10.4 million.
- Tymit secures 4 million GBP.
- Arbuthnot Commercial ABL issues 2 million GBP credit facility to EA-RS Fire Engineering.
- Crowd2Fund’s first EIS-approved funding round is now live.
- Starling Bank loses sixth senior employee.
- Robinhood debuts in the UK.
- OakNorth completes 3.54 million GBP loan for mixed-use development.
- Nexo joins Foundation for Wallet Interoperability.
- Twino CEO stands down while platform hits 1 billion euro milestone. CEOs don’t move aside unless it’s the best thing for the company.
- The best crowdfunding platforms in Europe.
- Smart lenders AM launches marketplace lending investment fund.
- EstateGuru partners with Ober-Haus.
- China: LexinFintech analysis. A must-read from Seeking Alpha.
- International: 2017-2018 P2P lending losses. From P2P-Banking.
- Brazil: Neon raises $95 million.
- Singapore: Ant Financial looking at digital banking license.
- Mexico: The fintech sector to watch in 2020.
- Southeast Asia: OneConnect starts two smart lending platforms focused on sustainable financing.
- Brazil: How Brazil is leading Latin America’s fintech revolution.
- Australia: What a competitive mortgage looks like in November 2019.
- United States
- Pro.Com Partners with SoFi to Make Home Improvements Even Easier (PR Newswire), Rated: AAA
- BlueVine raises $ 102.5M more for banking services that target small businesses (TechCrunch), Rated: AAA
- FT Partners Advises BlueVine on its $ 102,500,000 Series F Financing (FT Partners), Rated: B
- The OCC and FDIC Both Propose a Madden Fix (Lend Academy), Rated: AAA
- Big Tech Race to Own Digital Wallet; GS Robo-advisor on Launchpad (PeerIQ), Rated: AAA
- Insurance startup Vouch tacks on growth funding to serve startups (Pitchbook), Rated: A
- 5 Ways to Invest in Real Estate Online (The Motley Fool), Rated: A
- ArborCrowd Investors Receive Strong Returns on the Sale of Quarry Station Apartments (BusinessWire), Rated: A
- How Crowdfunding Has Changed the Game for Real Estate Investing (The Motley Fool), Rated: A
- The 10 worst US cities for commutes that cost you time and money (Business Insider), Rated: AAA
- Fintech: The Fourth Platform – Part One (Forbes), Rated: A
- Balboa Survey: Small Business Owners Anticipate Robust Black Friday (Monitor Daily), Rated: A
- American Financial Exchange, LLC (AFX) Announces AMERIBOR on the Blockchain (Mondovisione), Rated: A
- 5 Best Alternatives to Traditional Savings Accounts (Nerdwallet), Rated: B
- Alchemy Partners with Plaid to Enhance Loan Decisioning and Fraud Detection Capabilities (PRWeb), Rated: B
- United Kingdom
- Business Loans Marketplace Funding Xchange Raises $ 10.4 Million via Round Led By Downing Ventures, Gresham House Ventures (Crowdfund Insider), Rated: AAA
- London-based mobile credit card company Tymit secures £4m in funding (AltFi), Rated: A
- Arbuthnot Commercial ABL supports EA-RS Fire Engineering’s acquisition of Circum with £2m facility (Business-Money), Rated: A
- Crowd2Fund’s first EIS-approved funding round goes live (P2P Finance News), Rated: A
- Buzzy finance startup Starling Bank has lost another senior employee amid an exodus of executives (Business Insider), Rated: A
- Trading giant Robinhood makes its UK debut in Revolut challenge (City A.M.), Rated: A
- OakNorth Bank completes GBP3.54m loan to fund aparthotel development in London (Property Funds World), Rated: B
- Crypto Lending Platform Nexo Joins FIO, As Usability Remains Top Priority (Chipin), Rated: B
- LexinFintech: A Rare Quality (Seeking Alpha), Rated: AAA
- European Union
- Twino CEO stands down, as Latvian lender swings into black (AltFi), Rated: AAA
- The Best Crowdlending Platforms (The African Exponent), Rated: A
- Smart Lenders AM Launches New Investment Fund Specialized in Marketplace Lending (Crowdfund Insider), Rated: A
- Real Estate Crowdfunding Platform EstateGuru Partners with Ober-Haus on Market Research (Crowdfund Insider), Rated: A
- Profits and Losses of P2P Lending Marketplaces 2017 and 2018 (P2P-Banking), Rated: AAA
- What does a competitive mortgage rate look like in November 2019? (finder), Rated: A
- Ant Financial eyeing S’pore digital bank licence (The Straits Times), Rated: AAA
- OneConnect leads Southeast Asia’s sustainable financing with two smart lending platforms (Yahoo! Finance), Rated: A
- Latin America
- Brazilian Digital Bank Neon Raises $ 95 Million (Crowdfund Insider), Rated: AAA
- How Brazil is leading Latin America’s fintech revolution (Business Insider), Rated: A
- Why Mexico’s Fintech Sector Will Be One to Watch in 2020 (Next Billion), Rated: A
Pro.Com Partners with SoFi to Make Home Improvements Even Easier (PR Newswire), Rated: AAA
Pro.com, the premier digital platform focused exclusively on building custom homes and major remodels from start to finish, announced a new partnership Tuesday with online personal finance company SoFi, aimed at revolutionizing how homeowners finance and complete their remodels, renovations and upgrades.
BlueVine raises $ 102.5M more for banking services that target small businesses (TechCrunch), Rated: AAA
The startup, which offers financing and other banking services to SMBs, today is announcing that it has raised $102.5 million, a Series F round of equity funding that is coming from a mix of financial and notable strategic investors.
Led by ION Crossover Partners, the round also includes existing investors Lightspeed Venture Partners, Menlo Ventures, 83North, SVB Capital, Nationwide (a major financial services player in the UK), Citi Ventures, Microsoft’s venture fund M12, and private investors; as well as new investors MUFG Innovation Partners Co., Ltd, O.G. Tech (the VC connected to Israeli billionaire and property magnate Eyal Ofer), Vintage Investment Partners, ION Group, Maor Investments and additional private investors.
FT Partners Advises BlueVine on its $ 102,500,000 Series F Financing (FT Partners), Rated: B
FT Partners served as exclusive financial advisor to BlueVine and its board of directors on its $102.5 million Series F financing
The OCC and FDIC Both Propose a Madden Fix (Lend Academy), Rated: AAA
There is finally some real light at the end of the tunnel. In the last two days we have heard from both the OCC and the FDIC on the Madden issue, something they called unfathomable in a joint amicus brief in Colorado a couple of months ago. They have each given notice of their proposal that would clarify the “valid when made” doctrine once and for all.
At the core of the issue is the ambiguity created by the Madden decision. A loan can be valid when it is made but if it is sold or transferred can suddenly become invalid in the Second Circuit states of NY, CT and VT. This has led to reduced consumer lending to these states and also concern that, given no regulatory clarity, this could expand to other states.
Here are links to the OCC and FDIC proposals. There will be a 60-day comment period where interested parties can weigh in.
Big Tech Race to Own Digital Wallet; GS Robo-advisor on Launchpad (PeerIQ), Rated: AAA
Refinance demand increased by 13% from the previous week and was 188% higher than a year ago, when rates were 114 basis points higher.
First-time inversion driven by the long-end…
In regulatory news, lawmakers are taking aim at payday loan rates. Congress members plan to introduce federal legislation that would cap interest rates at 36%.
The next move for Facebook would be to offer lending products most likely indirectly (e.g., via POS partnerships or via co-brand products such as Amazon Chase Visa, etc.).
Insurance startup Vouch tacks on growth funding to serve startups (Pitchbook), Rated: A
Just two months ago, the ink was barely dry on a more than $24 million Series A that Sam Hodges raised for his startup Vouch Insurance. Now he is back with an even larger funding, led by Y Combinator‘s Continuity Fund, as the company seeks to join a crop of startups that cater to the needs of other startups.
Fireblocks Is Now Securing The Biggest Crypto Lending Company In The US (PR Newswire), Rated: A
Fireblocks (www.fireblocks.com), an enterprise platform for securing digital assets in transit, announced today, Celsius Network, the largest provider of interest income and digital asset loans in over 150 jurisdictions worldwide is enlisting Fireblocks to help protect over $400 million assets and 53,000 active wallets, securing both retail and institutional divisions.
5 Ways to Invest in Real Estate Online (The Motley Fool), Rated: A
The primary difference between using a crowdfunding site versus flying solo on your investment journey is that your investment is managed by a team of real estate professionals. Of course, that is also the biggest risk as you are completely dependent on the project developer to deliver what they promised.
If you are not an accredited investor but want to be involved in real estate crowdfunding, companies such as Fundrise, stREITwise, and RealtyMogul are a great place to start.
ArborCrowd Investors Receive Strong Returns on the Sale of Quarry Station Apartments (BusinessWire), Rated: A
ArborCrowd (the “Company”), the first crowdfunding platform launched by a real estate institution, announced today that its Quarry Station Apartments investment (“Quarry Station”) has been realized in under two years, providing investors with returns quicker and higher than initial projections. The property’s $49.35 million sale price generated an internal rate of return (IRR) of 20.31%, surpassing the original return target of 16% to 19%.
How Crowdfunding Has Changed the Game for Real Estate Investing (The Motley Fool), Rated: A
Through real estate crowdfunding, the developer can utilize an online platform that enables a large group of people to invest small dollar amounts in the project. If the development company chooses to follow the crowdfunding option, here’s how that could work:
- First, the developer identifies an online platform that is suited to the company or mixed-use development. Each platform is different and most real estate crowdfunding sites receive significantly more project applications than they select.
- If the investment passes all the legal, physical, and financial due diligence requirements the platform requires, that platform will then allow the developer to solicit funds using their site.
- An investor can then use that platform to contribute financially to the development.
- The funds are then tied up until the investor delivers on the project.
The 10 worst US cities for commutes that cost you time and money (Business Insider), Rated: AAA
Online loan marketplace Lending Tree published a report on the most expensive commutes in the 100 largest cities in the US in October.
Consider a resident in New York, which Lending Tree ranked as the city with the fifth most expensive commute. Using Lending Tree’s findings via 2017 Census Bureau data, the median annual earnings for a full-time employee in New York is $51,573; their hourly wage is $26. Now, consider the mean time of commuting one way, 41.8 minutes. If you make $26 per hour at your job, and you spend 83.6 minutes daily on your round-trip commute, then your time wasted commuting is worth $37 of time you would have been working.
Five cities in California – Oakland, San Jose, Irvine, San Francisco, and Fremont – took top 10 spots in the ranking, with four of those cities being in the increasingly expensive San Francisco Bay Area.
Read the full report here.
Fintech: The Fourth Platform – Part One (Forbes), Rated: A
While the first generation of fintech companies created billions of dollars of value, because of new enablers like Plaid, Cross River Bank, Finix and Wisetack, we’re now moving past that phase to one where fintech moves from being a business model unto itself, to being the fourth layer in the stack or the “fourth platform,” wherein financial functions like payments, lending and insurance join connectivity, intelligence and ubiquity as layers of the stack upon which new companies can be built.
Balboa Survey: Small Business Owners Anticipate Robust Black Friday (Monitor Daily), Rated: A
Online lender Balboa Capital released the results of its 2019 Black Friday Survey, which was conducted to examine how small business owners are preparing for this historically busy shopping day, and to find out what their Black Friday sales expectations are.
The survey reveals that 70% of small business owners are preparing for Black Friday early, and 83% anticipate meeting or exceeding their Black Friday sales goals. Balboa Capital’s survey was sent to a sample of small business owners in a wide variety of industries during the first week of November 2019.
American Financial Exchange, LLC (AFX) Announces AMERIBOR on the Blockchain (Mondovisione), Rated: A
American Financial Exchange (AFX), an electronic exchange for direct lending and borrowing for American banks and financial institutions, announced today the launch of its AMERIBOR on the blockchain. AFX now mints two ERC-721 non-fungible tokens for each AMERIBOR transaction on the AFX platform (for each counterparty to the transaction). The pair of tokens is automatically minted when the transaction is repaid by the borrowing counterparty to the lending counterparty. Each token contains encrypted transaction data and encrypted counterparty data. The counterparty data is normalized prior to encryption to further preserve counterparty anonymity.
5 Best Alternatives to Traditional Savings Accounts (Nerdwallet), Rated: B
The pros. Peer-to-peer lending tends to be a win-win: Investors get a higher rate of return on their money than a lot of banking products offer, and borrowers get an interest rate on their loan that’s usually less than bank-offered loans and credit cards.
The cons. Peer-to-peer lending won’t give you quick access to your cash if you need liquidity.
Alchemy Partners with Plaid to Enhance Loan Decisioning and Fraud Detection Capabilities (PRWeb), Rated: B
Alchemy, one of the SaaS fintech lending infrastructure companies, has partnered with Plaid to support businesses in account and asset verification for improved lending decisioning.
Business Loans Marketplace Funding Xchange Raises $ 10.4 Million via Round Led By Downing Ventures, Gresham House Ventures (Crowdfund Insider), Rated: AAA
Funding Xchange (FXE), a company that helps people and organizations find suitable business loans and funding options from its marketplace of more than 45 established lenders, has raised £8 million (appr. $10.4 million) through an investment round.
London-based mobile credit card company Tymit secures £4m in funding (AltFi), Rated: A
Tymit, the London-based mobile-enabled credit card company, has secured £4m in a funding round, which it will use to develop its customer service offering.
Arbuthnot Commercial ABL supports EA-RS Fire Engineering’s acquisition of Circum with £2m facility (Business-Money), Rated: A
Arbuthnot Commercial ABL, the specialist asset based lending arm of Arbuthnot Latham, has completed a £2m asset based lending (ABL) transaction in support of the strategic acquisition of Circum Ltd, a fire protection services specialist, by EA-RS Fire Engineering Ltd. (“EA-RS”). The facility comprises a flexible confidential invoice discounting line and a term loan.
Crowd2Fund’s first EIS-approved funding round goes live (P2P Finance News), Rated: A
CROWD2FUND has launched its first funding round since being granted Enterprise Investment Scheme (EIS) approval from HMRC.
The platform has already raised 19 per cent of its target from current shareholders and has now opened the £1.2m fundraise to private investors.
Buzzy finance startup Starling Bank has lost another senior employee amid an exodus of executives (Business Insider), Rated: A
Starling’s head of banking compliance Rachel Coote has quit to join startup Paybase. Coote is the sixth senior employee to leave the buzzy finance company in 2019.The company’s chief financial officer Tony Ellingham has confirmed he will also depart within the next year.
Trading giant Robinhood makes its UK debut in Revolut challenge (City A.M.), Rated: A
US fintech Robinhood, a commission-free trading startup valued at $7.6bn (£5.9bn), has today arrived in the UK.
Users will be able to invest in more than 3,500 US-denominated stocks, including Apple, Amazon and Tesla. They will also be able to access foreign stocks that are available to trade in dollars through depository receipts, such as Barclays and Burberry.
OakNorth Bank completes GBP3.54m loan to fund aparthotel development in London (Property Funds World), Rated: B
The finance will be used to fund the acquisition of a mixed-use property at 68‐86 Clapham Road in Oval, and in its place, develop an aparthotel with between 120-175 units, subject to receiving planning permission. The site is located within walking distance of several Zone 1 underground stations – Oval, Stockwell and Vauxhall – as well as the South Western railway line, providing services to Clapham, Waterloo, Guildford, etc.
Crypto Lending Platform Nexo Joins FIO, As Usability Remains Top Priority (Chipin), Rated: B
Nexo, the dominant player in the crypto lending space, is joining the Foundation for Wallet Interoperability (FIO), the industry consortia bringing together leading companies in the blockchain ecosystem to solve the biggest problem faced by the industry — usability.
LexinFintech: A Rare Quality (Seeking Alpha), Rated: AAA
LexinFintech (LX) reported a solid set of Q3 results with loan origination growing 170% y/y that resulted in a beat on both revenue and EPS. More importantly, loan origination guidance was increased to RMB115-125b vs. the prior forecast of RMB115b.
Overall, asset quality remains stable at the end of Q3 with delinquency rate declining 9bps to 1.4% and the 6-month charge-off rate maintained at just above 2%.
Institutional funding has reached 75% of the total loan balance. In terms of origination, institutional accounts for 94% of the total loans originated, meaning that LX’s own P2P platform Juzi Licai is becoming less relevant going forward.
Twino CEO stands down, as Latvian lender swings into black (AltFi), Rated: AAA
Twino founder Armands Broks is to standing down as CEO and will now focus on new business opportunities and bringing talent on board.
The management change comes as Twino, which offers European investors investment opportunities in unsecured European consumer loans, reports pre-tax profits of €13m (£11m) for 2018, compared to a €7.2m (£6.2m) loss the year previous.
Twino has also disclosed that it has also issued loans to the value of €1bn (£860m), since it was set up 10 years ago, half of the value of which have been issued in the past three years.
The Best Crowdlending Platforms (The African Exponent), Rated: A
Up to date, Mintos has issued over EUR 3 billion in investments, making it one of the biggest crowdlending platforms in Europe. Investors can invest in consumer loans such as cars, mortgage, short-term, and personal, as well as business loans like invoice financing, agriculture, business, etc. starting from as little as EUR 10 with return on investment of 11% per year on average.
Smart Lenders AM Launches New Investment Fund Specialized in Marketplace Lending (Crowdfund Insider), Rated: A
Smart Lenders AM announces the upcoming launch of a new fund dedicated to financing loans to European SMEs issued through marketplace lending platforms (crowdlending).
Real Estate Crowdfunding Platform EstateGuru Partners with Ober-Haus on Market Research (Crowdfund Insider), Rated: A
Real estate crowdfunding platform EstateGuru and OberHaus, real estate agency operating across the Baltic region, have joined together to produce shared real estate market research and analysis with a specialized focus on the needs of the crowdfunding platform.
Profits and Losses of P2P Lending Marketplaces 2017 and 2018 (P2P-Banking), Rated: AAA
What does a competitive mortgage rate look like in November 2019? (finder), Rated: A
The lowest fixed rate in Finder’s database right now is 2.68%, a single basis point lower than the lowest variable. This is unusual (the lowest three year fixed rate this time last year was 3.74%).
Another online lender I spoke to was fine with apartments in the same suburb but didn’t offer pre-approval. This meant I would have to start a full application with them even before I had found a place to buy. For some borrowers, this can be a significant turn-off.
Ant Financial eyeing S’pore digital bank licence (The Straits Times), Rated: AAA
Billionaire Jack Ma’s Ant Financial Services Group said it may apply for a virtual banking licence in Singapore, a move that would add a heavyweight contender to the race.
OneConnect leads Southeast Asia’s sustainable financing with two smart lending platforms (Yahoo! Finance), Rated: A
OneConnect Financial Technology Co. Ltd. (OneConnect), today announced it is leading Southeast Asia’s sustainable financing with the launch of two smart lending platforms – SeekCap, the Philippines’ first lending platform that helps the underserved micro, small and medium enterprises (MSMEs) manage cashflow and grow their business, as well as a multi-finance platform that will empower millions of unbanked and underbanked Indonesians with easy access to loans to finance their purchase of vehicles essential for their daily transportation so as to improve mobility and their lives.
MSMEs form the backbone of any economy. In the Philippines, more than 99% of all businesses are MSMEs and they contribute to almost 63% of total employment. Yet, at present, only 9% of loans and financing from the country’s major banks go to MSMEs.
Brazilian Digital Bank Neon Raises $ 95 Million (Crowdfund Insider), Rated: AAA
Brazilian Digital bank Neon has reportedly raised $95.27 million in a funding round led by Banco Votorantim and the General Atlantic fund. This is according to a write up in Estado.
Neon claims a customer base of 2 million users. The additional funding will help the digital bank grow with expectations to triple that number by 2020.
How Brazil is leading Latin America’s fintech revolution (Business Insider), Rated: A
There were 380 fintechs operating in the country in May 2019, per Finnovista, and around two-thirds (64%) of Brazilian consumers are defined as fintech adopters by EY — a rate that’s level with the global average and higher than the majority of G7 countries’.
- Smartphone and internet penetration: Three-quarters of Brazilians used smartphones in 2017, which is expected to tick up to 86% by 2025 — and both figures are the highest across the region.
- High fees charged by incumbents: Brazil’s four largest banks control almost 80% of the country’s deposits, with similar concentrations in credit and assets.
- A large underserved population: Around 45 million people in the country don’t have access to or have not used a bank account in the past six months.
Why Mexico’s Fintech Sector Will Be One to Watch in 2020 (Next Billion), Rated: A
The economy in Mexico remains largely informal and cash dependent. An estimated 44% of the adult population in Mexico owns no financial products. This largely unbanked population, coupled with the new fintech legislation, has created immense opportunities for Mexico’s fintech sector to grow. In fact, roughly 100 new Mexican fintechs were established in 2018 alone, representing 52% growth for the industry. Mexico has become a regional leader with more than 273 fintech ventures operating in the country. When combined with Brazil’s 380 fintech ventures, the two countries make up 56% of the region’s total fintech activity.