financial news

on the rebuildingsociety.com blog

04th Jan, 2016

P2P Weekly: Lending Future is Bright in China, and Other Stories

“China Lays Out Rules for Peer-to-Peer Lending Platforms,”
Wall Street Journal

The China Banking Regulatory Commission has released rules for the P2P lending industry and is seeking public comment. Clearer regulations for the more than 2,500 P2P lending operations in China have been in the works for a while, and 2016 should be a big year for the industry in that country.

“Report: China P2P Lending Topped $150 Billion in 2015,” Crowdfund Insider

The P2P lending industry in China generated more than £100 billion in 2015, according to Chinese news reports. This indicates a high level of interest from the public in this industry, since P2P lending gets almost no institutional money in the country.

“Peer to peer lending is set to explode,” Business Insider

Writes John Mauldin: “I’ve been a fan of private credit for a long time. Recently, I have once again been exploring the private-credit world, and it seems this market is growing faster than I had thought.”

“RBI plans guidelines for peer-to-peer lending,”
The Economic Times

The Reserve Bank Of India plans to develop guidelines to regulate the burgeoning P2P industry.

“They should be regulated under the State Money Lenders Act,” said Raman Agarwal, chairman of Finance Industry Development Council. “On these platforms, lenders are individuals and State Money Lenders Act applies to individuals, and not entities. In this case, individual is not an individual lender but a camouflaged lender.”

“Funding Circle passes £1bn lending milestone,”
The Guardian

Funding Circle surpassed £1 billion lent in 2015 and is on track to lend a further £1 billion in 2016.


14th Dec, 2015

P2P Weekly: A Closer Look at the Innovative Finance ISA

“Will the Innovative Finance ISA Allow Only a Few P2P Lenders to Participate?,” Crowdfund Insider

Deeper analysis of the Innovative Finance ISA indicates that only fully regulated P2P lenders can participate in the innovative ISAs. You can see the draft documents at the link.

“More closures seen among Chinese peer-to-peer lenders as new rules loom,” Reuters

Ezubao, the largest P2P lender in China based on lending figures, is being investigated for potentially illegal activity. So far this year, 824 lenders have shuttered.

“The Evolution Of Fintech,” Forbes

Forbes offers a useful summary of the fintech industry’s history. This is the first of two pieces.


07th Dec, 2015

P2P Weekly: US Update

“Dimon Says JPMorgan Plans Service With Peer-to-Peer Lender,” Bloomberg

JP Morgan Chase’s CEO has indicated the bank is looking to form a partnership that will allow the bank, the largest in the U.S., to add peer-to-peer lending to its portfolio of products and services.

“Are Chinese Platforms Abandoning the Peer-to-Peer Model?” Crowdfund Insider

P2P lenders in China are evolving into wealth management platforms that offer a broader range of programs. Lenders are taking different approaches to incorporating P2P into other services or consolidating various existing programs.

“Funding Circle’s peer-to-peer trust raises £150m in London Stock Exchange listing,” The Telegraph

Funding Circle is bringing P2P to the wider investment community for the first time.

“This vehicle will allow any investor to buy a ticket and get access to Funding Circle loans globally,” Funding Circle chief executive and co-founder Samir Desai said recently. “We want to be part of the global financial infrastructure.”

“Bank of England’s Funding for Lending Scheme extended,” Financial Times

“Monday’s move signals that while the BoE is increasingly nervous about a potential credit bubble in mortgage and consumer finance markets, it is still concerned about banks’ reluctance to lend to small businesses,” explains Martin Arnold of Financial Times.


16th Nov, 2015

P2P Weekly: Apple Launches New Payment App, and Other News

“Apple ‘to launch peer-to-peer payment app,” BBC

A new payment application from Apple would allow users to transfer money directly as a complement to the existing Apple Pay, and in direct competition with PayPal.

“investUP Authorised as “Crowdfunding Brokerage,” AltFi

investUP has now received full FCA authorization. Among other changes, the move means investUP can now continue to work with customers beyond the point of transaction.

“Bessemer Backs Consumer Lending Startup Bread,” Wall Street Journal

New York-based Bread powers a pay-over-time option for online merchants with seamless integration into the merchant’s website. The company recently received $14.3 million in backing from Bessemer Venture Partners.

“MIT Sloan Leads Collaboration Launching Groundbreaking FinTech Ventures, First US Grad-Level Fintech Program,” Crowdfund Insider

MIT will offer the U.S.’s first graduate level program on financial technologies.

““MIT has always been at the forefront in financial innovation and as financial technology is becoming more important in the financial world, we thought it was imperative to have a class covering this new trend,” observed Antoinette Schoar, Michael M. Koerner, Professor of Entrepreneurial Finance.


08th Nov, 2015

P2P Weekly: Gender Diversity Fuels P2P Success, and Other Stories

“‘Our Gender Diversity Is Absolutely A Factor In Our Success’: Q&A With Krista Morgan, CEO & Co-Founder Of P2Binvestor,” Crowdfund Insider

Says Morgan: “It’s a challenge to hire a diverse team, and it’s almost impossible if you’re not paying attention. After two years of building P2Bi I felt confident that I had found my own system for hiring the best people who were also diverse and wanted to share it since it’s such a huge issue. I’m hugely proud of the fact that P2Bi is 50 percent female across our company including our leadership team, which is extremely rare in tech and even more rare in finance.”

“SC to unveil peer-to-peer lending framework,” The Star Online

The Securities Commission in Kuala Lumpur will introduce a P2P framework next year. Leaders hope the program, called afFINity@SC, will encourage the growth of finance and investment innovation.

“How changes to EIS could affect UK small business funding,” GrowthFunders

Changes to the Enterprise Investment Scheme outlined earlier this year by Chancellor George Osborne will go into affect later this month. The changes lower both the age a participating company can have (seven years instead of 10) and the amount that investors can put into one company (£12 million instead of £15 million).

“Brief: Another Record Set in China P2P Lending for October,” Crowdfund Insider
Amid changes to regulations and other challenges, P2P lending in China continues to set records. So far this year, the industry has lent more than 1 trillion yuan, or about £1 billion.


04th Nov, 2015

P2P Weekly: Treasury Glows

“Treasury sings praises of peer to peer lenders,” FT Adviser

At the P2P Finance Association Summit in London, city minister Harriett Baldwin tipped her hat to the P2P industry, saying: “P2P platforms and fintech provide competition, ideas, and technology– making people’s lives better and the markets more effective. When you do well, your businesses flourish. Excellence breeds excellence. Customers have the services they need to meet their aspirations. And this country becomes better off, as a result of all this activity taking place here in the UK.”

“Where it’s due: Britain’s small firms are not as credit-starved as they may seem,” The Economist

Analysis shows that the credit outlook for SMEs in the UK is better than a surface level examination might indicate. Demand for credit increases, and SMEs are repaying loans quickly. Healthier banks and small businesses have made for a lot of activity, which should be considered a good thing.

SEC votes to allow equity crowdfunding for startups, small businesses,” Chicago Tribune

In the U.S., the Securities and Exchange Commission adopted new rules that allow individual investors to buy shares of startups and small businesses through crowdfunding platforms. Crowdfunding leaders praised the move as a step toward democratising investment. There are clear limits designed to protect investors based on an individual’s net worth and other factors.

“RebuildingSociety to support own auctions,” AltFi

Rebuildingsociety.com is in the news. Our new catalyst initiative, which promises that we will be the first to invest in all loans we post, has caught industry attention.


21st Sep, 2015

P2P Weekly: Next FinTech Frontier

“This is the next revolution in fintech, according to investors,” Business Insider

With crowdfunding, P2P lending, alternative payment methods and more shaking up the financial tech industry, some investors have their eyes on a new area of opportunity — insurance.

“We’re just at the start of an insurance explosion here. I’ve seen more and more insurance companies in the US, Europe, and Asia getting started,” said venture capitalist Pascal Bouvier. “I wouldn’t be surprised if we tally the numbers on investment in insurance startups two years from now and it’s massive.”

“Startup bringing peer-to-peer lending to Canada this fall,” The Globe and Mail

A new Canadian lender called Lending Loop will individuals investors with as little as $50 to join its membership. It’s the first peer-to-peer lender accessible to average people in Canada, where other companies have only allowed accredited investors to join.

“Saved from the streets by crowdfunding, young woman looks to the future,” The Guardian

In a heartwarming story out of London, photographer Cathy Teesdale turned to the crowd to help Naiomi, a homeless woman and aspiring horse trainer, get into safe housing. Teesdale’s JustGiving campaign raised more than £1,000 in two days, and now Naiomi is getting back on her feet.

“Fast-growing P2P sector set for shakeout,” Wall Street Journal

New regulations from the Financial Conduct Authority designed to improve the security of the peer-to-peer lending sector are putting the squeeze on some firms. Industry leaders have said the new regulations drastically change the economic reality for lenders, especially smaller ones. Others have noted that “thinning the herd” may not be such a bad thing, as it will increase the reliability of the industry as a whole if all participating lenders are more economically stable.

“Prestamos Prima launches peer to peer lending for real estate in Spain,” Crowdfund Insider

Spanish finance group Prestamos Prima is launching Viventor, which will provide peer-to-peer loans secured by mortgages. Initially, it will only be open to EU investors. Says Prestamos Prima CEO Andris Rozenbahs:

“The financing model of high street banks is outdated, and they are too slow to change the course as fast as the market demands. Recent years have shown that alternative finance solutions are reshaping the industry, and a major change on stage is inevitable.”


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