News Briefing - Crowdfunding, SME And Alternative Finance

Crowd on a railway platform, waiting for a train.

1.UK – FinTech

 

 

There was lots of positive news in the fintech world in 2019, but a number of digital challengers endured a rocky 2019. Here AltFi charts five that will be relieved 2019 is over, including…

“Funding Circle

The peer-to-peer lender Funding Circle endured a difficult 12 months, with a plundering share price amid a number of challenges.

The P2P lender conducted an internal review after it was discovered investors were having to wait more than 16 weeks to withdraw cash. Funding Circle said it was “exploring a range of options” to tackle the problem delaying investors from selling their loans in its secondary market.

Funding Circle also fell out of the FTSE 250, marking a further blow. In August. Funding Circle, which had a disappointing float in 2018, reported a pre-tax loss of £31m over the last six months, compared to a £27m loss the year previous. Its share price is now 90p, compared to the 440p float price.

P2P sites have come under intense regulatory scrutiny since Lendy, which focused on property development loans, collapsed last year. The Financial Conduct Authority has clamped down on the sector, including limiting the amount individuals can invest.

However, there was good news in October when Funding Circle’s shares climbed over 10 percent after its loans under management soared 31 percent to £3.7bn, but the company cautioned of "an uncertain economic outlook”.”

 

2. UK – FinTech

 

Crowd-funding platform Seedrs has announced that the amount invested in pitches on its platform grew 49 per cent to £238m in 2019. City A.M. reports.

“It said it completed 250 deals during the year, up from 186 in 2018, and delivered 7,858 investor exits on its secondary market.

Highlights included Scottish fintech Paysend raising £10.7m and football club AFC Wimbledon raising £2.4m from over 5,000 investors.”

 

3. UK – FinTech

 

One of the last of the crop of predictions for 2020 comes from AltFi: consolidations, profitability(!) in the sector, open finance expansion, globalisation, and a few collapses…

 

4. US – Equity

 

The SEC is taking in feedback on what constitutes an “accredited investor”. Crowdfundinsider reports.

 

5. US – FinTech

 

What future for cash? Crowdfund insider reports.

“The House Financial Services Committee has published its schedule of hearings for the month of January. Included in the mix, is a gathering of the Fintech Task Force, a relatively new entity created by Committee Chairwoman Maxine Waters.

The Fintech Task Force will review the relevance of cash and the emergence of digital payments. The title of the hearing is, “Is Cash Still King? Reviewing the Rise of Mobile Payments.”

Also on the list of hearings, is a full Committee meeting to discuss the topic of non-bank firms leveraging 3rd party bank charters. This hearing is entitled, “Rent-A-Bank Schemes and New Debt Traps: Assessing Efforts to Evade State Consumer Protections and Interest Rate Caps.”