International P2P Lending Volumes December 2016

The following table lists the loan originations of p2p lending marketplaces in December. Funding Circle leads ahead of Ratesetter and Zopa. Lendix reports an all time record month. Saving Stream and Assetz Capital had a good month, too. Mintos crossed the milestone of 100 million EUR originated since inception. The total volume for the reported marketplaces adds up to 414 million Euro. I track the development of p2p lending volumes for many countries. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending platforms.

Investors living in national markets with no or limited selection of local p2p lending services can check this list of marketplaces open to international investors. Investors can also explore how to make use of current p2p lending cashback offers available.

P2P Lending Volume 12/2016
Table: P2P Lending Volumes in December 2016. Source: own research
Note that volumes have been converted from local currency to Euro for the sake of comparison. Some figures are estimates/approximations.
*Prosper and Lending Club no longer publish origination data for the most recent month.

Notice to p2p lending services not listed: Continue reading

Lendico Quietly Stops Origination of New Consumer Loans in German Market

Without any public announcement Lendico has stopped to originate new consumer loans in the German market sometime in the past weeks (months?). Instead it has embedded a loan application tool of Finanzcheck in the Lendico website and refers interested borrowers to this company. Lendico told inquiring investors that the company will focus on loans to businesses in Germany. As far as I know, Lendico has not published any recent figures on loan volume origination. On Dec. 7th, 2016 Rocket Internet SE published its financial report for the first half of 2016. There is a short mention that Rocket Internet SE has booked a ‘Wertminderungsaufwand’ (own translation: decline in value) of 19.482 million EUR for the corporate holding of Lendico.

Two months ago Lendico stopped issuing consumer loans in the Netherlands. Earlier the company stopped issuing new loans South Africa. The status of the Lendico operation in Austria seems unchanged to me – at least the website is unchanged and allows applications for consumer loans in Austria.

The only real visible development in the past months was the launch last week of the joint venture between Postfinance and Lendico in Switzerland.

UPDATED: An earlier version of this article had incorrect information about the status of Lendico Brazil

International P2P Lending Volumes November 2016

The following table lists the loan originations of p2p lending marketplaces in November. This month I added Swaper. Funding Circle had a record month, for the first time crossing 100M GBP in new monthly volume, ahead of Zopa and Ratesetter. The total volume for the reported marketplaces adds up to 438 million Euro. I track the development of p2p lending volumes for many countries. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending platforms.

Investors living in national markets with no or limited selection of local p2p lending services can check this list of marketplaces open to international investors. Investors can also explore how to make use of current p2p lending cashback offers available.

P2P Lending Statistic 11/2016

Table: P2P Lending Volumes in November 2016. Source: own research
Note that volumes have been converted from local currency to Euro for the sake of comparison. Some figures are estimates/approximations.
*Prosper and Lending Club no longer publish origination data for the most recent month.

Notice to p2p lending services not listed: Continue reading

International P2P Lending Volumes October 2016

The following chart lists the loan originations of p2p lending marketplaces in October. Funding Circle had a record month ahead of Zopa and Ratesetter. Lendinvest has strong results too and Assetz Capital makes a big leap forward. The total volume for the reported marketplaces adds up to 443 million Euro. I track the development of p2p lending volumes for many countries. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending platforms. Thincats crossed the 200M GBP funded this inception milestone.

Investors living in national markets with no or limited selection of local p2p lending services can check this list of marketplaces open to international investors. Investors can also explore how to make use of current p2p lending cashback offers available.

P2P Loan volume October 2016
Table: P2P Lending Volumes in October 2016. Source: own research
Note that volumes have been converted from local currency to Euro for the sake of comparison. Some figures are estimates/approximations.
*Prosper and Lending Club no longer publish origination data for the most recent month.

Notice to p2p lending services not listed: Continue reading

Post Brexit: Bondora Plans European Office in Germany Instead of London

bondora-logo-2016bEstonian p2p lending marketplace Bondora will open a new European office in Germany, saying that post brexit London is no longer attractive as a Fintech hub. Bondora formerly planned to move to London but stopped the plan after the brexit vote. ‘There is too much uncertainty, the UK lost its attractiveness as a fintech hub’ explains Bondora CEO Pärtel Tomberg the decision. Now he has Berlin, Frankfurt and Munich on the short-list. The head office will stay in Tallinn

For the Bondora business model very good access to the European market is crucial says Tomberg. He sees uncertainty how long London might be able to provide this.

After informal tals with German regulator Bafin, Bondora CFO Rein Ojavere got a positive view on the perspective for fintechs in Germany: ‘German’s regulators open up more and more to innvations in the financial sector to attract fintechs and seminal start-ups.’. Continue reading

International P2P Lending Services – Loan Volumes September 2016

The following chart lists the loan originations of p2p lending marketplaces in September. This month I added Crowdestate. Funding Circle, Ratesetter and Zopa had a record month. The total volume for the reported marketplaces adds up to 424 million Euro. I track the development of p2p lending volumes for many countries. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending services. Milestones in total volume originated since inception:

Investors living in national markets with no or limited selection of local p2p lending services can check this list of marketplaces open to international investors. Investors can also explore how to make use of current p2p lending cashback offers available.

P2P Lending Statistic Sep. 2016
Table: P2P Lending Volumes in September 2016. Source: own research
Note that volumes have been converted from local currency to Euro for the sake of comparison. Some figures are estimates/approximations. The Wellesley volume is 0 for this month – this may be a reporting error.
*Prosper and Lending Club no longer publish origination data for the most recent month.

Notice to p2p lending services not listed: Continue reading

Smava Raises 34M US$ Series C

smava-logo-2016German credit broker Smava today announced that it has closed a 34 million US$ investment which was led by growth investor Runa Capital, with additional participation from Verdane Capital and mojo.capital. Runa Capital is a venture capital firm with other investments in Zopa, Lendingrobot and Lendio. Verdane Capital is a Scandinavian private equity firm. Existing investors including Earlybird Venture Capital also participated in the investment. This series C round follows the previous round in 2015 which was 16 million US$. In total Smava, which launched in 2007, has raised about 64 million US$ so far.

Smava wants to use the funding to expand the customer base, hire additional talent and continue enhancing our scoring technology according to CEO Alexander Artopé.

Smava connects private borrowers with a broad selection of banks and private investors on its marketplace. Smava offers personal loans ranging from 1,000 to 120,000 Euros. Continue reading

Discussion Paper on P2P Lending Published by Deutsche Bundesbank

The central bank of Germany, Deutsche Bundesbank, has published a discussion paper on the role of p2p lending in the consumer credit market written by Calebe de Roure, Loriana Pelizzon and Paolo Tasca. The study analyses data of German p2p lending marketplace Auxmoney.

Research Question

In recent years, we have begun to observe the growth of the internet economy, which has progressively led to “crowd-based” platforms and the direct matching of lenders and borrowers. Via peer-to-peer (P2P) lending platforms the decision process of loan origination is given into the hands of private lenders and borrowers. This paper investigates how the P2P lending market fits into the credit market and specifically aims to answer the following questions: Why do retail consumers look for P2P financial intermediation? Are the interest rates charged by P2P lenders in Germany higher than those of banks? Are P2P loans more risky than bank loans? Are internet-based peer-to-peer loans substitutes for or complementary to bank loans?

Contribution and Results

The paper shows that loans channelled via P2P platforms involve higher interest rates than loans channelled via the traditional banking sector. They are also riskier than those of banks. However, when adjusted for risk, the interest rates are comparable. Moreover, analysis of the different segments of the bank credit market and P2P lending shows that, after having controlled for interest rate and risk differences, the bank lending volumes are negatively correlated with the P2P lending volumes. Our finding suggests that high-risk borrowers substitute bank loans for P2P loans since banks are unwilling or unable to supply this slice of the market. Continue reading

New European Alternative Finance Industry Report – Sustaining Momentum

The European online alternative finance market, including crowdfunding and peer-to-peer lending, grew by 92 per cent in 2015 to €5.431 billion, according to the results of the 2nd Annual European Alternative Finance Industry Survey conducted by the Cambridge Centre for Alternative Finance at University of Cambridge Judge Business School, in partnership with KPMG and supported by CME Group Foundation.

The report released today, titled “Sustaining Momentum”, had the support of 17 major European industry associations and research partners, and was based on data from 367 crowdfunding, peer-to-peer lending and other alternative finance intermediaries from 32 European countries – capturing an estimated 90 per cent of the visible market. P2P-Banking.com is one of the research partners.

The United Kingdom was by far the largest in Europe at €4.4 billion, followed by France at €319 million, Germany at €249 million and the Netherlands, €111 million. Other large European markets include Finland with €64 million, Spain at €50 million, Belgium at €37 million and Italy at €32 million. The Nordic countries collectively accounted for €104 million, while Central and Eastern European countries registered a total of €89 million.

Excluding the UK, the European alternative finance market grew by 72 per cent from €594 million in 2014 to €1.019 billion in 2015.

“Although the absolute year-on-year growth rate slowed by 10 per cent” (from the 82 per cent growth excluding the UK between 2013 and 2014) the industry is still sustaining momentum with substantive expansion in transaction volumes recorded across almost all online alternative finance models,” the report said.

Peer-to-peer consumer lending is the largest market segment of alternative finance, with €366 million in Europe in 2015. Peer-to-peer business lending is the second largest segment with €212 million, with equity-based crowdfunding in third with €159 million and reward-based crowdfunding fourth at €139 million.

Sustaining Momentum Figure 11
Table: Figure 11, page 31 of ‘Sustaining Momentum’, volumes by market segment in Europe 2015 (outside UK)

Among other findings:

  • Estonia ranked first in Europe in alternative finance volume per capita at €24, followed by Finland at €12 and Monaco at €10 outside of the UK.
  • Online alternative business funding increased by 167 per cent year-on-year to €536 million raised for over 9,400 start-ups and SMEs across Europe.
  • Institutionalisation took off in mainland Europe in 2015, with 26 per cent of peer-to-peer consumer lending and 24 per cent of peer-to-peer business lending funded by institutions such as pension funds, mutual funds, asset management firms and banks.
  • Across Europe, perceptions of existing national regulations in alternative finance are divided. About 38 per cent of surveyed platforms felt their national regulations for crowdfunding and peer-to-peer lending were adequate and appropriate, 28 per cent perceived their national regulations to be excessive, and a further 10 per cent said current regulations were too relaxed.
  • The biggest risks perceived by the alternative finance industry are increasing loan defaults or business failure rates, fraudulent activities or the collapse of platforms due to malpractice.

Perceived risks
Chart: Figure 28, page 47 of ‘Sustaining Momentum’, risks to the industry as perceived by the polled platforms

Robert Wardrop, Executive Director of the Cambridge Centre for Alternative Finance, said: “European alternative finance transaction volume increased to more than €5 billion in 2015, with volume outside of the UK market exceeding €1 billion for the first time. The European alternative finance industry is still small, however, and the slowing rate of growth during the year is a reminder of the risks the industry must contend with in order to transition from a start-up to a sustainable funding channel within the European financial services ecosystem.”

Irene Pitter, Global Executive, Banking & Capital Markets and member of the FinTech Leadership Team at KPMG, said: “This report shows that the alternative finance sector is set to continue to grow and mature. 2016 marks a significant year for ‘alternative finance’ in Europe as the market demonstrates clear signs of continued strong growth and increased maturation in the sector as a whole. European activity, excluding the UK, showed solid growth of 72 percent last year and demonstrated client demand for alternative finance solutions even in the smaller EU countries.”

Rumi Morales, Executive Director, CME Ventures, said: “The prominent feature of financial technology is that it is truly borderless. No one country is harnessing alternative financial markets or business models to the exclusion of any other. Rather, from the UK to Estonia and from Finland to Monaco, the entire European continent is experimenting and expanding upon innovations that can provide greater access to capital and financial services to more people than ever before.”

See the full report below. Continue reading

International P2P Lending Marketplaces – Loan Volumes August 2016

The following chart lists the loan originations of p2p lending marketplaces in August. Funding Circle leads ahead of Ratesetter and Zopa. Zopa yesterday announced an interest rate cut of 0.2% following the BoE decision to lower interest rates. Zopa warned that new deposits would be slower to lend out, and will take 10 days on average, as it faces a shortage of borrowers. Zopa used to accept 1 percent of applicants, but now approves on 20 percent.The total volume for the reported marketplaces adds up to 336 million Euro. I track the development of p2p lending volumes for many countries. Since I already have most of the data on file I can publish statistics on the monthly loan originations for selected p2p lending services.

Investors living in national markets with no or limited selection of local p2p lending services can check this list of marketplaces open to international investors. Investors can also explore how to make use of current p2p lending cashback offers available.

P2P Lending Statistic 08/2016 by P2P-banking.com

Table: P2P Lending Volumes in August 2016. Source: own research
Note that volumes have been converted from local currency to Euro for the sake of comparison. Some figures are estimates/approximations.
*Prosper and Lending Club no longer publish origination data for the most recent month.

Notice to p2p lending services not listed: Continue reading