FinTech Lending & Leasing
Lending companies on the list includes primarily peer-to-peer lending platforms as well as underwriter and lending platforms using machine learning technologies and algorithms to assess creditworthiness. New leasing solutions are also classified in a lending space.
Finances purchases of retail customers with instant loans at interest rates of 0% to 30%. Affirm connects directly to online stores. The idea behind is that customer purchases with Affirm during checkout at online store, which captures and processes order. Affirm settles the full amount with the store and services the loan directly with the customer.
One of the founders of Affirm and a CEO is Max Levchin, a co-founder of PayPal and Yelp.
Another company in FinTech lending space is Avant, which makes instant online loans of $1,000 to $35,000 to retail cutomers at 10% to 36% interest for two to five years and has lent already $2 billion, with an average loan size of $8,000.
Avant has already received funding of $659 million from KKR, Peter Thiel, August Capital and Tiger Global Management.
Borro is a UK-US-based online secured lender that offers loans secured on property and luxury assets. The company provides non-recourse loans allowing clients to use luxury assets such as fine art, luxury and classic cars, jewellery, watches, antiques, fine wine, luxury handbags, memorabilia and other valuables.
C2FO call itself the market for working capital and optimizes the service of factoring business. It uses bid system and algorithms to match buyers sitting on extra cash with suppliers ready to accept discounts for payment within 48 hours, which allows for optimization of the cash flow of businesses. Through C2FO already flow invoices on over $100 billion.
C2FO already received funding on $99 million from Union Square Ventures, Mithril Capital Management and Temasek.
Founded in 2008 Credit Karma provides free credit scores and credit monitoring to retail users as well as personalized help in making the credit scoring better. Credit Karma is an example of FinTech success story with valuation of $3.5 billion as of last financing round in June.
Fundbox is FinTech company challenging traditional factoring firms. Fundbox offers small-business owners advances on outstanding invoices. Owners pick which invoices they want to borrow against, and advances are made to directly to bank account, with repayments later debited automatically. Fundbox is synching with Quickbooks and other accounting software. Fundbox already has 30,000 small businesses as its customers.
Fundera is an online marketplace designed to help small businesses. It connects founders with 28 potential funding providers for their company. Pre-screened lenders assemble the highest quality funding sources and ensure that owners receive fair rates and terms on each loan granted. This idea of pre-approved loans will help save time and rejection for these owners to get their business underway as soon as possible. Already over 1,700 borrowers have used platform to borrow $85 million.
Funding Circle is a peer-to-peer lending service which allows savers to lend money directly to small and medium sized businesses. Cost of the loan is in the range 7% to 33% per annum from 6 to 60 months and loan amount from $25K to $500K and approval time up to 10 days. From investors perspective Funding Circle minimizes the risk of bad debts by spreading the investment for over 100 loans.
GoRefi is the marketplace for mortgages that helps homeowners save money on their refinance by cutting out the middleman.
Kabbage targets merchants using websites such as ebay.com and amazon.com as well as other sellers that are rejected or overlooked by traditional lenders such as banks because of their lack of collateral or lower credit scores. Kabbage uses buyer feedback ratings, selling history, turnover, accounting data, bank account information and other metrics to approve unsecured cash advances online in a few minutes.
Lending Club operates an online lending platform that enables borrowers to obtain a loan, and investors to purchase notes backed by payments made on loans. Lending Club enables borrowers to create unsecured personal loans between $1,000 – $35,000. The standard loan period is three years. Investors can search and browse the loan listings on Lending Club website and select loans that they want to invest in based on the information supplied about the borrower, amount of loan, loan grade, and loan purpose. Investors make money from interest. Lending Club makes money by charging borrowers an origination fee and investors a service fee.
The company claims that $16 billion in loans had been originated through its platform
Gives small-business owners access to their business and personal credit scores, help comparing rates from 36 lenders. Nav’s customer base has grown over 10 times since the beginning of 2015, now with more than 80,000 small business customers using its platform to build their free business credit profile, as well as leverage a personalized marketplace that connects them to business financing based on their credit profile and needs.
Launched in 2007, FinTech company On Deck uses data aggregation and electronic payment technology to evaluate the financial health of small and medium sized businesses and deliver capital to a market often underserved by traditional banks.
Orchard Platform is a technology and infrastructure provider for marketplace lending. Orchard supports operational efficiencies to help institutional investors, investment managers and loan originators connect and transact. Founded in New York City in 2013, Orchard focuses on building the systems that will allow marketplace lending to grow into a global financial market. Orchard also provides services directly to three of the biggest lending platforms–Lending Club, Prosper, and Funding Circle
Peer-to-peer lending site connects borrowers and lenders for unsecured loans at fixed rates ranging from 5.99% to 36%. Borrowers request personal loans on Prosper and investors (individual or institutional) can fund from $2,000 to $35,000 per loan request. In addition to credit scores, ratings, and histories, investors can consider borrowers’ personal loan descriptions, endorsements from friends, and community affiliations. Prosper handles the servicing of the loan and collects and distributes borrower payments and interest back to the loan investors. This FinTech lending platform has originated $5 billion in loans, third only to Lending Club and SoFi
SoFi – which is short for Social Finance – offers student loan refinancing, personal loans and mortgages to young borrowers with high-end jobs and degrees. SoFi is a FinTech unicorn with valuation of over $4 billion.
Vouch uses conept of social network of loan cosigners that enables borrowers with low credit scores to get a lower rate or larger loan online by having multiple friends and relatives guarantee or “vouch” for small parts of the loan–an average of $110 per voucher.
Wonga is a British payday loan company offering short-term, high-cost credit for retail customers.
ZestFinance Uses unconventional metrics to underwrite loans to those with low credit scores or thin credit histories. Example: Borrowers who enter their name in all caps in the online application are poorer risks. Zest was chosen to underwrite loans on big Chinese retail site JD.com
