In October 2015 Liberum’s fintech analyst Cormac Leech presented an epic 32-page direct lending market overview (Direct Lending: Finding value/minimizing risk) at the LendIt conference in London. In the presentation he provides a great global perspective of the online direct lending market.
According to Liberum’s report: Bondora is the highest returning platform in the marketplace lending industry.
“Liberum’s report demonstrates clearly that our focus on underserved and inefficient consumer lending markets delivers market-leading returns for investors looking for long-term high yield investment opportunities”, says Pärtel Tomberg, CEO of Bondora.
Here is our summary of the key findings from the presentation:
- The largest markets currently in online direct lending are China, US and UK followed by Continental Europe.
- The world of online direct lending is worth an estimated $185 billion.
- Continental Europe has the biggest growth opportunity – volumes are set to overtake UK by 2020 with a 5,2x bigger addressable market.
- Marketplace lending asset class offers better risk/reward ratio than equities (up to 4x higher).
- No negative annual returns over last 20 years in direct lending.
- Online credit data is as good/better than bank data.
- Online direct lenders are 60% more efficient vs. traditional lenders.