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From fuel and groceries to hotels and airline tickets, consumers are putting more purchases on credit cards—and taking longer to pay them off. 
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Japanese buy now, pay later (BNPL) outfit Paidy has raised US$120 million in a Series D funding round.
Vineet Anand's insight:
Paidy with its 5MM users and 700k websites (merchants) raises $120MM. BNPL on a tear globally in acceptance, usage, and transaction growth!
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Bengaluru-based fintech lending platform KreditBee’s holding entity, Finnov has raised an additional $70 million in a follow-on Series C round from TPG-backed NewQuest Capital Partners and Motilal Oswal Private Equity.
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The biggest U.S. banks reduced the portion of their collective balance sheets they’re dedicating to loans to a new low, extending a trend that’s seen the largest lenders put less and less of their firepower behind everyday borrowers.
Vineet Anand's insight:
Loans are lower by ~1% compared to last year to $5.5T including SBA lending. Big banks have scaled back on lending and rather kept funds in other liquid forms including fed backed securities.
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Standard Chartered is to launch a standalone technology company catering to the needs of small and medium-sized business in India.
Vineet Anand's insight:
Standard Chartered establishes platform in India to support needs of SMEs!
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JPMorgan Chase is preparing to move into the POS financing market, enabling customers to pay in installments for $500-plus purchases and run up loans on bigger ticket items.
Vineet Anand's insight:
"My Chase Plan" to enable $500 plus post-purchases lending! Neo- loan lenders share has increased to 38% of total goal balances.
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HSBC is teaming up with commercial lending platform Neptune Financial (NepFin) to target middle market businesses in the US in need of capital.
Vineet Anand's insight:
NepFin to help mid-size businesses seeking international expansion, wherein HSBC has limited branch coverage / presence!
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UK small business lender iwoca has raised £150 million in equity and debt capital, including figures from a recent Series D equity round led by Augmentum Fintech.
Vineet Anand's insight:
iwoca Series D round takes total raised to PS150 million!
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Nav, a business financial management app that helps small firms get better financing by giving them free access to credit reports, has raised $44.8 million in a Series C funding round led by Goldman Sachs and joined by Experian Ventures.
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UK online mortgage broker Mojo Mortgages has raised £7 million in a Series A funding round joined by NVM Private Equity and Maven Capital Partners.
Vineet Anand's insight:
Mojo rases PS7 million in its Series A funding!
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Mortgage finance software house Ellie Mae is to be acquired by private equity firm Thoma Bravo for $3.7 billion.
Vineet Anand's insight:
Ellie Mae gets acquired by private equity firm! Macroeconomic conditions reflecting overall housing sales of existing and new homes slowing down. Thoma Bravo must have a long term vision to create greater value.
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An Post, the Irish Post Office has put out a Request For Information for potential partners to help develop new lending capabilities for consumers and businesses as it prepares to take on the country's leading banks.
Vineet Anand's insight:
Ireland postal office seek to offer lending services to home buyers and businesses. An Post to offer credit cards and personal loans soon! A digital offering will pit against incumbents and own brand for non-banking services.
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From
www
The first half of 2016 has been a surprising reality check for once-highflying online lenders, touted by some as the future of banking.
Vineet Anand's insight:
Online alternative lenders brace a new reality with companies including LendingClub, Prosper, Avant with increasing defaults and lower investor confidence to purchase paper driving layoff's to manage business profitability and margins.
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From Yahoo Finance: The French entrepreneur, one of the highest-profile names in the fledgling industry, left LendingClub in May after an internal probe found the company had falsified documentation when selling $22 million of loans to an investor. The scandal sent shock waves through a sector already dealing with investor nervousness about rising loan losses and cratered LendingClub's stock, which has lost nearly 40 percent of its value in under a month. In the weeks following his May 9 departure, Laplanche approached firms about financing a bid to take the company private, the people said.
Vineet Anand's insight:
Lending club woes continue as largest investor sells its stake. A company that was valued at $9 billion in 2014 is now worth $1.68 billion!
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From
www
New York’s top financial regulator launched an inquiry into the business practices of LendingClub, the third investigation the online lender has faced since its chief executive and founder was forced to resign earlier this month.
Vineet Anand's insight:
Lending club woes continue as now NY regulator investigating into the business practices and model for New Yorkers taking loans from the company. The stock has fallen from $11 to $4 since resignation of CEO post lending practices of the company.
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The article talks about Staples and Thinking Capital Launching Staples Business Loans, Helping Small Business Owners Make More Happen
Vineet Anand's insight:
Staples Canada to offer SMB lending using Thinking Capital, a leader in SMB loans!
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WeLab, an online lending platform based in Beijing and Hong Kong, will launch more financial products in China after landing an impressive $160 million Series..
Vineet Anand's insight:
Since launch in 2013, WeLab has lent money to 2.5 million customers mostly in mainland China. The company operates two online lending platforms - one of China and other for Hong Kong, ING has participated in this Series B round post its investments in Kabbage.
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Finextra: UK payments processor WorldPay is to move into the alternative finance market through an alliance with small business cash advance outfit Liberis.
Vineet Anand's insight:
The LSE IPO debut valued WorldPay at PS5 billion post a period of potential acquisition considerations by WP. SME lending is becoming a natural extension for a number of SME payment players across US and Europe. The partnership with Liberis will aid in serving a need for some of its 280,000 SME businesses and a more loyal base of customers!
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Finextra: Canada's CIBC is to partner with alternative marketplace lender Thinking Capital to enable small business owners to apply for a loan of up to $300,000 online, with decisions in minutes and funding in just a few days.
Vineet Anand's insight:
CIBC enteres referral partnership with alternative lending provider Thinking Capital
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Finextra: UK-based peer-to-peer lender Funding Circle is to expand into Europe with a deal to acquire German lender Zencap.
Vineet Anand's insight:
Zencap acquisition adds Germany, Spain and Netherlands to existing Lending Circle UK and US markets!
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Finextra: TrustBuddy, one of the few publicly-traded peer-to-peer lending operations in Europe has shut down, after discovering a £3.5 million discrepancy.
Vineet Anand's insight:
Publically traded P2P lender TrustBuddy suspends operations on financial misconduct to the tune of PS 3.5 million!
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Finextra: Santander InnoVentures, ING and Scotiabank have joined a $135 million investment round in automated lending platform Kabbage.
Vineet Anand's insight:
Kabbage has now raised $240 million to date and will be partnering with ING for SMB lending!
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Finextra: Digitally enabled insurgents are placing bank-based lenders under increasing pressure and pose "a significant threat to every part of the commercial lending business" says a survey conducted by Misys.
Vineet Anand's insight:
P2P Lending in 2014 across UK was PS1.2 billion with nearly 200 platforms and another 100 awaiting FCA approval. Growth in P2P Lenders and Lending mostly to individual and SMB's is creating a challenge for bank lenders!
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Finextra: The venture capital arm of Germany's CommerzBank has joined in a $20m funding round for UK-based SME lending platform iwoca.
Vineet Anand's insight:
iwoca raises $20m in Series B funding round which includes CommerzBank. iwoca partnered with Alibaba few months back to offer microfinance for Chinese suppliers.
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Finextra: Amazon is bringing its business loan programme to eight new countries, including China, India and the UK, according to Reuters.
Vineet Anand's insight:
Amazon lending program extends to eight new countries including India, China, UK!
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Curated by Vineet Anand
Payment Industry leader passionate about Fintech, Innovation in Banking, Product Management & Strategy, driving revenue growth through client management, business development and P&L focus.
Other Topics
Leadership & Communication
Payments Ecosystem
The Payments ecosystem is evolving at an unprecedented pace driven by mobile, cloud computing, start-up's challenging the behemoths, and new technologies. My personal collection of curated stories and blogs.
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World Economy News
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Today's news of 2023 GDP at 3.1% has a strong component of consumer spending embedded to fuel further conversation around the sate of the economy in 2024, gyrating between soft landing to growth! While 2023 numbers had most economists reflecting back on how different 2024 turned out from their prediction models - the Fed policy at least for now seems to be effective with a waning inflation rate.
Consumer card spending in 2023 rose by ~$525B with a 'B' to $2.25T since 2019 for top 4 banks with JPM, and BofA raking high single digits and WF spending was up 15%.
There are underlying concerns in these numbers:
- 30+ days delinquency numbers have risen consistently over past 8 quarters to the highest levels now
- Card loan balances have exceeded the 2019 level by ~$525B
- BNPL will have some contribution to the overall spending volume on cards
- Consumer deposits have fallen across all 4 banks
From a consumer dynamic perspective there has been heavy spending during holidays, disposable income has reduced even though wages have risen, student loans pause in payments has now been lifted, insurance for homes & cars have risen, and even though inflation is slowing - the consumers will not end-up having the same prices that existed 3 years ago requiring them to budget differently to the new reality.
On the plus side the banks so far have not provisioned for higher than usual delinquencies, wages improved, employment levels are good, consumer confidence is higher, and GPD continues to show expansion during a election year.