Around the world
Finance Magnates published an article forecasting that marketplace lending will drive business growth in 2017. Alternative lending is valuable not only for personal loans but for businesses seeking financing alternatives. As the author explains, “P2P loans are unsecured, so you don’t have to tie up precious collateral, the funding process is faster than a bank and requires less paperwork.”
Reuters explained new moves by traditional banks aiming to evolve into the P2P marketplace. “Financial technology vendor Misys is launching software to enable banks to provide peer-to-peer lending to their customers as competition from young companies in the sector heats up,” explains the author. This comes amid growing interest in marketplace lending as an alternative to slower, conventional methods.
Equities.com reminded investors to consider marketplace lending as a poart of their protfolio in 2017. Their research illustrates that “Even taking the very conservative approach of investing in the highest-quality loans, you can still earn almost five times the 1.16% rate now available with the average one-year bank CD.” This is certainly true at Bondora where 89% of investors have earned over 10% annually.
ValueWalk provided a brief overview of how investors can manage marketplace lending. The author explains how diversification and analytic tools are the best ways to succeed. In this case diversification means holding many loans. Using tools means opting for new third-party programs which are available to investors who want to analyze P2P returns across firms.
Bloomberg explained the intersection of FinTech and RegTech. FinTech (Financial Technology) describes any kind of technology designed to facilitate transactions and investments. RedTech describes digitized solutions for firms (like P2P businesses) facing complex regulation standards. In an effort to handle regulations “these internet-based marketplaces have teamed up with big banks to underwrite loans for them.”
Bondora got a mention from a German Aktien-Blog article which examines the reasons why borrowers and small businesses are turning to P2P and other online lending platforms for credit instead getting it from banks.