Archive for 2017

Catching Up With Marketplace Lending – A Timeline

June 13, 2017
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A timeline of alternative finance

This article is from deBanked’s May/June 2017 magazine issue. To receive copies in print, SUBSCRIBE FREE 4/11 Regions Bank recruited Kabbage’s chief technology officer, Amala Duggirala, to become its chief information officer 4/12 Federal Reserve Published their 2016 Small Business Credit Survey 4/13 Marathon Partners, a minority shareholder of OnDeck, publicly called on the company […]

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That Awkward Moment in Alternative Lending When…

June 13, 2017
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#dontbank

That awkward moment when you apply for a bank charter (::cough:: SoFi ::cough::) and you realize your company’s motto has literally been #dontbank all along… The above is actually from a video they made about how much banks suck. Just, don't do it. #DontBank pic.twitter.com/lnxKJHH3QJ — SoFi (@SoFi) February 11, 2016 This is the beginning […]

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Sound Bites From Underwriting – The Risk of Imperfect Merchants

June 12, 2017
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underwriting blind

When you’re funding a business, does the risk begin and end with the business? Or does the character of the owners play a role? Can you judge the business on weak financials if your product is geared towards weak financials to begin with? And can you trust unaudited internally prepared financial statements? At the Factoring […]

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Upstart’s Average Borrower

June 12, 2017
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upstart logo

Online lender Upstart considers more than 10,000 variables such as an applicant’s education, academic performance, and employment background, according to their website, a proprietary system they say is used to detect “future prime” borrowers. But according to a recent Kroll Rating Agency report, their borrower base looks prime even by traditional standards in that their […]

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Another NY Supreme Court Judge Casts Doubt On The MFS – Volunteer Pharmacy Case

June 10, 2017
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Courtroom

Just as an Orange County, NY judge found in Merchant Funding Services, LLC v. Micromanos Corporation d/b/a Micromanos and Astsumassa Tochisako that a uniquely structured merchant cash advance was not a criminally usurious loan, so too did the Honorable Maria S. Vazquez-Doles on June 8th, court records reveal. Vazquez-Doles, who also presides in Orange County, […]

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Sound Bites From Underwriting – Gambling With a New Broker

June 9, 2017
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red flags

At the Factoring Conference during a portfolio warning signs panel, Emma Hart, the COO of Sallyport Commercial Finance, was asked if she recalled any red flag situations that hinted at collusion. Whether in factoring or not, you can probably relate to this situation with a new broker: We had one fairly recently that we should […]

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Humans vs. Bank Statements – An Underwriting Journey

June 8, 2017
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bank statements

This article is from deBanked’s May/June 2017 magazine issue. To receive copies in print, SUBSCRIBE FREE Automation hasn’t replaced humans yet when it comes to reading bank statements in the alternative small-business finance industry. ISOs, brokers, funders and underwriters still fend off drowsiness and ignore the risk of eye strain as they pore over months […]

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Marketplace Lending: The Next 10 Years

June 7, 2017
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Looking out at the future

The marketplace for consumer and small-business loans has come a long way over the last 10 years. Since the early days of peer-to-peer lending, there has been a great proliferation of new types of intermediaries creating new layers of distribution for the risk involved with the lending process. Now marketplace lending has reached an inflection […]

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Industry CEOs Were Less Confident in Q1

June 6, 2017
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Industry Confidence Q1 2017

According to the latest quarterly Bryant Park Capital/deBanked survey of industry CEOs, confidence dropped to the lowest levels since the survey first began in Q4 2015. Specifically, confidence in being able to access capital needed to grow dipped down to 78.7% from 82.7% in the prior quarter. Confidence in the continued success of the Small […]

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District Court Offers Guidance on Merchant Cash Advances in Precedent-Setting Decision

June 6, 2017

Courtroom

On May 9, in Colonial Funding Network, Inc. v. Epazz, Inc., the U.S. District Court for the Southern District of New York dismissed counterclaims alleging the overcharging of interest and the affirmative of usury. The decision is the first federal case to recognize that a contractual relationship establishing a bona fide merchant cash advance (MCA) […]

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