Around the world
GlobeSt published an article exploring the broad based acceptance of marketplace lending in the borrowing community. One industry insider remarked, “Once a novelty, they are now an established capital source and are compared favorably against crowdfunding platforms and traditional lenders.” Marketplace lending is becoming more niche as well. Some newer entrants to the industry specialize in commercial real estate loans.
National Mortgage News wrote about the “era of self-service online mortgages.” The author makes an interesting point “that humans may be more biased than algorithms.” Additionally, the cost structure of a traditional bank makes smaller customers less attractive. This segment of the market is where marketplace lending can deliver solutions.
Crowdfund Insider discussed the changes to the marketplace lending industry in 2016. Marketplace lending insider Ram Ahluwalia remarked ,”year over year originations are still up across the industry.” The future of P2P lending will likely include greater institutional business to supplement the retail segment.
Value Walk identified the problem of diminishing dividend returns and low bond yields. The author posits that marketplace lending may serve to “earn 7% returns in a 2.5% world.” The future is promising as evidenced by the fact that “In 2016, P2P investors earned net annualized returns north of 7%.”
Forbes discussed how growing college tuition is pushing the marketplace lending industry higher. “Morgan Stanley estimated that P2P student loan issuance will grow at a 20% compounded annual rate through 2020 and account for 14% of this market,” shared the author. As tuition costs continue to rise it’s likely that lending needs in this sphere will help sustain and grow originations.
Fonds Online published a guest post from our CFO Rein Ojavere. In the article Rein discusses why so many successful FinTechs come from the Baltic countries – and what Germany can learn from it.