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THE ALTERNATIVE LENDING REPORT Volume 2, No. 2 January 25, 2018

INSIDE Poll Reveals Vigorous INDUSTRY NEWS Lending Scene for 2018 A recap of recent news By Mark Henricks of importance to lenders, brokers, and service providers...... 2 More than a third of U.S. lenders plan them lending more to borrowers. “These to loosen borrower requirements in 2018 calculated modest rate hikes look good LOANTAPE and nearly 90 percent expect to lend for lender sentiment,” Sioukas conclud- more capital, according to a survey by ed. The other 44 percent of lenders who Select Banks with Significant Magilla Loans. The survey of more than answered this question indicated, how- Exposure to Small Business Loans...... 5 200 lenders included large and commu- ever, that Fed rate adjustments would not nity banks as well as alternative lenders affect how much they loaned. Specialty Finance Companies with and credit unions. In what could be a positive sign for Exposure to Small Business Loans...... 5 Magilla, an anonymous search engine loan approvals, more than a third – 36 for business and residential loans, did percent – of the lenders said they would not break out results by source of funds. be reducing their current requirements Online Lenders...... 5 CEO Dean Sioukas said, however, that for loan approval. A majority – 56 per- small and alt-fin lenders considerably cent – said they would not change their Funds of Interest...... 5 outnumbered the large banks included in requirements, and 8 percent said they the poll. would tighten requirements. Indices of Interest...... 5 “Since the majority were community “I took it as a positive,” Sioukas said. banks and alt-lenders, while there are “Banks don’t move that quickly. When we M&A + Partnerships ...... 6 only so many big banks, it really does saw that over a third are willing to reduce show you what they’re thinking,” Siou- their requirements – what does that mean New Investments...... 7 kas said. “The sentiment was consistent for the other two-thirds?” across the different lender types.” Although only a minority of lenders New Technology & Product Launches... 8 About 40 percent of the lenders sur- anticipated loosening borrower require- veyed indicated that they were primarily ments, Sioukas speculated that it could serving business borrowers. The other 60 turn into a broader trend. “I’d say that U.S. SMALL BUSINESS LOAN percent were providing residential mort- you’re going to end up with followers in INTEREST RATES BY LENDER gage financing. the other two-thirds,” he said. Nearly 9 in 10 Lending Optimism Depends Avg. Annual Interest Rate (AIR) Expect to Lend More on Where You Live Type of All SBA Lender Loans Loans One of the most definitive findings There was some regional variation of the survey was that a large majority of in the degree of optimism lenders had Online & . . lenders – 88 percent – said they expected about the market. Approximately 60 Alternative 7. 7. to lend more in 2018 than in 2017. percent of respondents indicated they Lenders “That was stronger than I’d expected,” would like to lend in the Northwest and Sioukas said. “I think that’s related to a Southwest. Just 16 percent each pre- Large 2.55 National 5. 6.2 prediction on interest rate moves, their ferred the Northeast and Southeast, and Banks assessment of the Fed and their assess- about 25 percent expressed a preference ment of the economy in general. From a for the Midwest. Small 2.8 National & 5. 5.6 personal standpoint, I think there’s still “That one was unpredictable,” Sioukas eg. Banks pent-up demand.” said. “That was not something we knew Foreign Banks A majority – 56 percent – of the lend- or even had a good guess as to what the .5 ers surveyed said they believe an interest answer was going to be. But those seem by .S. 5.66 branches rate adjustment by the Fed will result in to be the targeted regions for the lend- Source: Federal Reserve, SBA Turn to ‘Poll’ on page 9 For use by original recipient only. It is illegal to forward or otherwise distribute without permission.

THE ALTERNATIVE LENDING REPORT Industry News

Why Is Asset-Based 100% growth in issuance over the year- Lending So Expensive? ago period. PeerIQ expects issuance to Editor & Publisher grow by 30% to $18 billion in 2018. bit. Steve Dresner There is a common belief, especially ly/2BivPuz among business borrowers, private equi- Managing Editor ty funds and M&A sponsors, that inef- SBA Lending Begins Steve Evans ficiencies leading to predatory pricing 2018 on High Note exist in the small-cap and lower middle Contributing Writers market business lending space. That The current fiscal year has already Teri Buhl assumption may be incorrect because the seen a record amount of loans backed William Freedman ABL cost structure is very different in by the U.S. Small Business Administra- Mark Henricks comparison to inexpensive bank lending. tion (SBA). The key lending program, Joao-Pierre Ruth bit.ly/2DWr1xY SBA 7(a) loans, surged nearly 20 per- cent year-on-year in dollar terms in the Production Editor Mulvaney Sets first quarter of the 2018 fiscal year. bit. Gary Newman Public Review of ly/2Ddzhf1 Entire CFPB Operations How Blockchain Will Mick Mulvaney, acting director of the Lenny La Sala Revolutionize Invoice- Consumer Financial Protection Bureau, Backed Financing has issued “a call for evidence” seeking Technology comment on how the bureau can fulfill One of the biggest risks in invoice Tarun Gupta its functions to best protect consumers. financing is fraud. Buyers often have Miguel Larreynaga The CFPB said it plans to publish a concerns over the legitimacy of an series of requests for information in the invoice, the power a given user has to Federal Register in the coming weeks. execute a transaction or even the pos-

THE ALTERNATIVE LENDING REPORT bit.ly/2F0QBkT sibility of impersonation. In some cases, DealFlow Financial Products, Inc. the seller may have financed the invoice P.O. Box 122 Victory Park Eyeing repeatedly without the financiers being Syosset, NY 11791 Global Expansion aware of this. The use of distributed led- T (516) 876-8006 ger technology can put an end to these F (516) 876-8010 Chicago-based Victory Park Capi- concerns. bit.ly/2r4DKf0 [email protected] tal is reportedly looking at opportuni- www.alternativelending.io ties for expansion in global markets. Banks Cautious The Alternative Lending Report™ is published on every “For us, I see a worldwide opportunity,” Thursday, except on Thursdays where there is a holiday in Mulling Fintech during the week in which U.S. stock markets are closed. Brendan Carroll, senior partner and co- Subscription rate: $1,495 per year. Acquisitions founder said in an interview. He noted a All rights reserved. © 2018 DealFlow Financial Products, Inc. Photocopy permission is available sole- steady rise in “underbanked” populations Banks may be intrigued by fintech ly through DealFlow Financial Products. Copying, around the world. “I think the U.S. is a distributing electronically by email, or duplicating this innovations, but remain cautious when publication in any manner other than one permitted by massive, massive market, but I definite- considering M&A. Top officials at banks agreement with DealFlow Financial Products is pro- hibited. Such actions may constitute copyright ly think opportunities exist outside the have trouble gauging fintech targets’ earn- infringement and leave perpetrators subject to liabil- U.S.” bit.ly/2mYpsr1 ings power, and many find that there may ity of up to $150,000 per infringement (Title 17, U.S. code). AlternativeLending.io™ and The Alternative not be a cultural alignment. bit.ly/2r25gdl Lending Report™ are trademarks of DealFlow Finan- MPLs Set Record-Breaking cial Products, Inc. 4Q Securitizations of Lendio Joins Entrepreneur’s The Alternative Lending Report is a general-circula- tion publication. No information herein should be $4.4B; 30% Increase Franchise 500 construed as legal advice or to be recommendations to purchase, retain, or sell securities, or to provide Expected in 2018 investment advice of the companies mentioned or Lendio announced that it joined the advertised. No fees are accepted for publishing any ranks of Entrepreneur magazine’s Fran- editorial information. DealFlow Financial Products, Peer IQ reports 10 marketplace lend- Inc., its subsidiaries, and its employees may, from ing securitizations priced in the fourth chise 500. Lendio was also recognized as time to time, purchase, own, or sell securities or other investment products of the companies quarter totaling $4.4 billion, a record the #1 brand in the Business Financial discussed or advertised in this publication. for quarterly issuance, representing Services category. bit.ly/2r3pByH

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THE ALTERNATIVE LENDING REPORT Industry News

Fintechs Offer Views Amazon Lending U.S. SME Lending Builds on Open Banking to SMBs Tops Momentum: PayNet $3B in 2017 and Spotcap executives weigh Small business lending expanded in on the implications for fintech firms Amazon in a press release said it in November, according to the latest in the wake of new open banking laws, loaned more than $3 billion in 2017 U.S. Small Business Credit Monthly where individuals and businesses manage to small businesses operating on its Report from PayNet, a provider of small their finances by opening up access to platform. More than 300,000 SMBs business credit data and analysis. bit. the heretofore closely guarded reserves joined the platform last year and ly/2DvCDYE of transactional data held by the big more than 140,000 small businesses banks. bit.ly/2AXxXYz each surpassed $100,000 in sales. bit. Far West Capital Funds ly/2CWfrBx $900M in 2017 Crowdstacker Joins P2P Finance U.S. Mid-Market Lenders Far West Capital, a privately funded Association Concerned About commercial finance company headquar- tered in Austin, today announced a new Leverage, Loan Docs Crowdstacker has joined the Peer- high: $5.3 billion in financing to high- to-Peer Finance Association, becom- Lenders to U.S. mid-sized busi- growth entrepreneurs since its inception ing the self-regulated trade body’s nesses are increasingly concerned about in 2007; over $900 million was provided eighth member. The company joins the higher levels of debt held by middle in 2017 alone. bit.ly/2DePnVC fellow platforms , Funding market companies versus a year ago, as Marlette , , Lending Works, Mar- well as what they consider to be less ket Invoice, ThinCats and Zopa. bit. restrictive leveraged loan documents, a Taps New CFO ly/2r4dbqu survey by Carl Marks Advisors found. Marlette Funding said it hired Mark bit.ly/2qZ3hq5 Predicting Comptroller Elbaum as the company’s new chief Otting’s Impact Community Banks Aim financial officer. Most recently, he was the CFO of Merrill Lynch, Bank of on Fintech To Amplify Competitive America’s Wealth Management business. Edge With Fintechs Joseph Otting was sworn in as bit.ly/2r3PAGj Comptroller of the Currency on Nov. While marketplace lending platforms A Risky P2P Opportunity 27. “We anticipate that he will contin- and alternative finance players first sur- for 2018 ue the approach of Acting Comptroller faced to compete with traditional finan- Keith Noreika, balancing the OCC’s cial institutions, many large banks have Last year was tough for the P2P consumer protection mission with its now realized that collaborating with finance sector, which received a great parallel duty to preserve the safety and these companies is the way to better deal of negative publicity with many soundness of the banking system and the service SMBs — and without the added observers predicting an imminent melt- institutions the OCC regulates,” accord- investment in developing proprietary down. Nevertheless, data from the big- ing to attorneys with Ballard Spahr. bit. systems. bit.ly/2r2INg5 gest platforms suggest that investors still ly/2D7RYS1 received a decent yield. Now for the year Ascentium Tops ahead…. bit.ly/2AWuaur Fed-Backed $1B in Funded Volume Digital Currency ‘Is During FY 2017 Chapter 11 Filings Inevitable’: Op/Ed Up 6% YoY Ascentium Capital, the nation’s larg- Signs are pointing to the Federal est private-independent finance com- The American Bankruptcy Institute, Reserve beginning to take steps toward pany, announced it surpassed $1 billion citing data provided by Epiq Systems, issuing its own digital currency. Late last in annual funded volume for the first reported total commercial Chapter 11 year, a top Fed official offered enthusias- time in the organization’s history. bit. filings during calendar year 2017 were tic support for the promise of distributed ly/2D2ehV2 up 6% from 2016. bit.ly/2EGjzpF ledger technologies in financial services. bit.ly/2qZ2gyh

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THE ALTERNATIVE LENDING REPORT Industry News

Encina Adds GE Capital the 7(a) Loan Program, including pro- impacting the sector, which firms in the Vet to Lead West Coast visions to increase the lending cap. bit. field might do well to keep in mind. bit. ly/2FBquSj ly/2DsLp9G Clark D. Griffith joined asset-based SME lender Encina Business Credit as CFPB’s Info. ID Freeze: Wynnchurch Capital senior managing director to lead origina- Policy or Pure Politics? Promotes Four, Hires Two tions on the West Coast. He previously served as senior managing director of The Consumer Financial Protection Wynnchurch Capital, a middle- GE Capital Structured Finance in Japan. Bureau’s recent freeze on collecting any market private equity firm, promoted bit.ly/2D10Ncx personally identifiable information from Carl Howe and Brian Riordan to vice companies it supervises is slowing inves- president and JD Frank and Kevin Senate Bill Seeks to Improve tigations and could ultimately cripple the Hanley to senior associate. Addition- Small Business Access to agency’s enforcement function — and ally, Wynnchurch hired two new asso- Capital Through SBA 7(a) that may be the point. bit.ly/2Dc26IJ ciates, Chris Waldock and Ben Cherry. Howe joined Wynnchurch in 2012. He The Small Business 7(a) Lending Staying on Top of Small previously worked at Houlihan Lokey Oversight and Reform Act of 2018 was Biz Financing Trends and at Alvarez & Marsal. Riordan introduced with bipartisan support to also joined Wynnchurch in 2012 after strengthen small business lending. The Pitched from the perspective of a working at BMO Capital Markets. bit. bill would increase the Small Business small business owner, the article high- ly/2D7NTxs Administration’s oversight authority over lights preeminent financing trends

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THE ALTERNATIVE LENDING REPORT LoanTape

Select Banks with Significant Exposure to Specialty Finance Companies with Small Business Loans Exposure to Small Business Loans A cross-section of publicly traded community banks with market capital- Publicly traded companies engaged in small business lend- izations of at least $100M and at least 3% of assets in small business loans ing through commercial finance operations or BDCs, with with outstanding principal of $1M or less, according to FDIC. Market at least $500M in market cap. Market data as of January data as of January 23, 2018. 23, 2018. MKT. CAP CURRENT 12-MO. % SMALL BIZ MKT. CAP CURRENT 12-MO. COMPANY TICKER ($M) PRICE ($) CHANGE LOAN % COMPANY TICKER ($M) PRICE ($) CHANGE Signature Bank SBNY 8,399.81 156.47 1.67 14.4% American Express Bank AXP 85,046.27 97.98 28.97% Glacier Bank GBCI 3,117.94 39.97 17.42 3.5% Intuit Inc. INTU 43,066.78 168.46 43.86% United Community Bank UCBI 2,316.68 31.56 13.40 6.7% Prospect Capital Corp. PSEC 2,475.91 6.87 (20.85%) Towne Bank TOWN 1,989.97 32.15 0.94 4.3% The Pitney Bowes Bank PBI 2,401.32 12.86 (18.09%) Independent Bank Corp. INDB 2,014.84 73.40 18.20 4.2% FS Investments FSIC 1,904.37 7.75 (25.12%) Ameris Bank ABCB 2,012.34 54.05 25.12 6.8% Main Street Capital Corp. MAIN 2,265.24 38.99 6.91% BancFirst BANF 1,786.10 56.00 19.59 3.8% TPG Specialty Lending TSLX 1,184.62 19.67 4.02% Pacific Premier Bank PPBI 1,925.04 41.65 15.69 7.7% Golub Capital BDC, Inc. GBDC 1,090.86 18.31 (2.24%) State Bank Financial STBZ 1,186.91 30.44 17.48 3.7% New Mountain Finance NMFC 1,023.37 13.50 (5.92%) Sandy Spring Bank SASR 1,373.79 39.35 (0.18) 4.3% Hercules Capital, Inc. HTGC 1,110.95 13.20 (7.11%) German American Bancorp GABC 818.83 35.71 9.63 7.0% TCP Capital Corp. TCPC 908.93 15.46 (8.63%) Farmers and Merchants Bank FMCB 540.18 665.00 6.40 31.5% Solar Capital Ltd. SLRC 896.77 21.22 (0.38%) Macatawa Bank MCBC 352.31 10.38 5.49 7.8% Goldman Sachs BDC, Inc. GSBD 887.29 22.11 (3.70%) Southern First Bank SFST 323.87 44.25 27.71 9.0% Fifth Street Finance Corp. FSC 717.49 5.09 (7.29%) Bank First National BFNC 305.53 45.50 35.82 9.2% PennantPark Investment PNNT 491.03 6.91 (10.95%) Howard Bank HBMD 213.96 21.80 42.09 8.9% BlackRock Capital Investment BKCC 450.01 6.15 (16.44%) Sunshine Bank SBCP 205.23 8.85 19.59 7.3% Pacific Mercantile Bank PMBC 152.66 23.58 0.00 16.8% California Bank of Commerce CABC 123.24 10.30 28.91 3.1% Online Lenders NorthEast Community Bank NECB 124.43 10.40 33.16 3.1% Publicly traded companies engaged in online lending to consum- ers as well as businesses. Market data as of January 23, 2018. CURRENT 12-MO. % Funds of Interest COMPANY TICKER LOAN TYPE PRICE ($) CHANGE All data as of January 23, 2018 or last reported date. Information sourc- China Rap. Finance XRF Cons. (China) 5.60 n/a es include Nasdaq and company websites. Elevate Credit ELVT Consumer 7.69 n/a CURRENT 12-MO. Enova ENVA Cons./Bus. 16.20 16.55% FUNDS TICKER PRICE % CHANGE IOU Financial IOU Business 0.10 (52.00%) Funding Circle SME Income Fund (in GBP) FCIF 1.06 0.84% Lending Club LC Cons./Bus. 4.21 (28.52%) P2P Global Investments PLC (in GBP) P2P 8.14 0.49% NewTek NEWT Business 17.77 11.90% Ranger Direct Lending (in GBP) RDL 7.56 (28.68%) OnDeck ONDK Business 4.74 (2.87%) River North Marketplace Lending (in USD) RMPLX 24.37 (3.63%) OneMain Holdings OMF Consumer 33.37 46.94% SQN Secured Income Fund PLC (in GBP) SSIF 0.93 3.19% Square SQ Business 45.01 208.08% VPC Specialty Lending (in GBP) VSL 0.79 0.96% Yirendai YRD Cons. (China) 38.78 79.04% Indices of Interest All data as of January 23, 2018 or last reported date. Constituents refer to either stocks or individual loans included as members of the index. Information sources include Nasdaq and company websites. INDEX TICKER VALUE CONSTITUENTS TYPE KBW/Nasdaq Fintech Performance Index KFTX 1,484.51 50 Fintech Cliffwater Direct Lending Index CDLI 3,342.44 > 6,000 Bus. Loan Orchard U.S. Consumer Online Lending Index n/a 1,544.58 1,367,128 Cons. Loan

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THE ALTERNATIVE LENDING REPORT LoanTape

M&A + Partnerships During the period January 9 through January 22, 2018, M&A deal activity and strategic partnership announcements in the alterna- tive lending and small business lending segments included the following companies/transactions. DATE COMPANIES STRUCTURE DEAL DESCRIPTION 1/22/18 Spotcap, Bawag Group Partnership Alternative lending platform Spotcap said it formed a partnership with Bawag Group, marking the start of its licensing business. The partnership will enable Austrian SMEs to access same-day funding by leveraging the platform’s lending technology and analytics.

1/19/18 Trade Finance Solutions, Acquisition Trade Finance Solutions, a provider of domestic and international financing solutions for SMEs, Paragon Financial Group announced that its parent has acquired Paragon Financial Group.

1/19/18 GreatAmerica Financial Partnership Commercial Finance company GreatAmerica Financial Services said it partnered with Jenne to offer Services, Jenne resellers, solutions providers and their customers the HaaR (hardware as a rental) program, which combines the attributes of hardware as a service (HaaS) and equipment financing.

1/17/18 Marlin Business Services, Partnership Marlin Business Services and Avery Weigh-Tronix, a provider of industrial products and weighing Avery Weigh-Tronix systems, entered a partnership to provide financing options for Avery Weigh-Tronix’s North American customers.

1/11/18 LendingPoint, LoanHero Acquisition LendingPoint announced Jan. 11 that it has acquired LoanHero, a fintech platform for point of sale finance. Terms of the deal were not disclosed.

1/11/18 ETHLend, Enigma Partnership ETHLend has teamed up with technology firm Enigma, which has built a second-layer "off-chain" network that still records the transactions but encrypts them so the data can’t be accessed.

1/11/18 Accutrac Capital, Sienna Acquisition Accutrac Capital, a specialized factoring company focused on the trucking industry, said it acquired the Transportation Finance portfolio assets of Sienna Transportation Finance, a New Jersey-based freight factoring company.

1/10/18 United Community Merger United Community Banks and NLFC Holdings announced a definitive agreement for United to acquire Banks, NLFC Holdings NLFC, including its wholly-owned subsidiary, Navitas Credit.

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THE ALTERNATIVE LENDING REPORT LoanTape

New Investments During the period January 9 through January 22, 2018, new investment activity in issuers operating in the alternative lending and small business lending segments included the following companies/transactions. DATE COMPANY BUSINESS DESCRIPTION AMOUNT STRUCTURE USE OF PROCEEDS INVESTORS 1/19/18 defi SOLUTIONS defi SOLUTIONS, Inc. develops $55,000,000 Venture, Series To position the company to even Bain Capital Ventures SaaS based loan origination C better meet the demands of top 20 software solutions for small and auto lenders as well as lenders of all mid-size, and large auto finance sizes. lenders.

1/19/18 Varo Money Varo Money, Inc. operates as a $45,000,000 Venture, To further the explosive growth of Warburg Pincus, The financial technology company Series B its banking app, which improves the Rise Fund that provides mobile-only banking financial lives of its customers. solutions.

1/18/18 Fundation Fundation Group LLC provides Undisclosed Debt To strengthen their competitive Waterfall Asset online business loans in the position in the small business Management United States. lending market.

1/17/18 Harvest Small Harvest is a nationally licensed $60,000,000 Debt To fund its nationwide originations Capital One Business SBA lender which originates, sells of SBA 7(a) loans. Finance and services loans to qualifying small businesses.

1/16/18 Lendix Lendix, SA develops and operates $247,832,000 Debt Undisclosed EIB, CNP Assurances, a loan platform for private Decaux Freres individuals and institutional Investissemenets, investors bound for SMEs. Asset Management, Groupama, Eiffel IM, Matmut Freres Investissements

1/16/18 Akami Alkami provides a digital banking $70,000,000 Venture, Series To accelerate the delivery of S3 Ventures, Argonaut platform that enables clients D technology and innovative solutions Private Equity of banks and credit unions to to clients. experience functionality across all digital devices.

1/12/18 QuarterSpot QuarterSpot, Inc. provides small $5,000,000 Equity Undisclosed Undisclosed business loans. 1/11/18 Simply Asset Simply Asset Finance is a new non- $85,291,200 Undisclosed For hire purchase, finance leases and The British Business Finance bank lender. refinancing. Bank

1/10/18 Goji Goji is a P2P investment Undisclosed Undisclosed To develop Goji’s platform and Anthemis, AXA Strategic manager and Innovative Finance product pipeline, including its Ventures ISA administrator. diversified P2P lending bond.

1/10/18 LendingKart Lendingkart Technologies Private $500,000 Debt Undisclosed FMO Limited operates as a fin-tech company in the working capital space.

1/10/18 YieldStreet YieldStreet, Inc. operates a $113,000,000 Debt, Equity To accelerate the transformation Expansion Venture crowdfunding marketplace for of wealth creation by investing Capital LLC, Saturn the specialty finance industry. in further product innovation and Partners, Greycroft, growing its loyal community of Raine Ventures LLC, FJ investors. Labs, TFO USA Limited

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THE ALTERNATIVE LENDING REPORT LoanTape

New Technology & Product Launches During the period January 9 through January 22, 2018, platform announcements, new software and services, and notable product releases in the alternative lending and small business lending segments included the following. DATE COMPANY NEW TECHNOLOGY / PRODUCT DESCRIPTION 1/22/18 Fundbox Fundbox announced the launch of a new credit-integration service called Fuse. It's designed so SaaS business providers can offer easy access to Fundbox from within their workflows with just three lines of code.

1/22/18 LendingCrowd LendingCrowd said it launched an account that enables investors to take an income from their peer-to-peer loans.

1/22/18 Xelerate Xelerate Logistics announced the launch of its latest innovative supply chain solutions product line under the brand XLR8 Companies.

1/18/18 UPS Capital UPS Capital, a subsidiary of UPS, announced that it is expanding its UPS Capital Cargo Finance solution, which provides small- and medium-sized businesses with credit lines to finance goods as they are shipped.

1/18/18 Funding Knight The Funding Knight platform name has been changed to Sancus Funding with GLI Finance transferring its holdings in the group to its Sancus BMS subsidiary.

1/18/18 IFA The International Factoring Association announced the launch of its newly designed and mobile friendly website and revealed its new logo.

1/17/18 Global Payout Global Payout launched its newly formed logistics subsidiary, SecurCapital, focused on supply chain finance logistics.

1/16/18 Zopa Zopa said it is preparing to launch an income verification tool for borrowers as part of its first foray into Open Banking.

1/16/18 Sorodo Online business finance brokers Sorodo unveiled a financing platform that will include P2P lenders among the funding options it presents to businesses.

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THE ALTERNATIVE LENDING REPORT Poll

Continued from front page ers. Texas and Florida and the Sunbelt Magilla Loans is watching for overtures any concerns about it because our goal are always going to do well. But there to small business lending by the big is to provide a broad cross-section of seemed to be a focus on the Northwest banks that largely abandoned the mar- choices.” and Southwest.” ket after the Great Recession. How- While some alt-fin lenders are pur- Magilla Loans began offering its ever, he said that Magilla Loans won’t suing partnerships with large banks loan-finder ser- because of the perception vice to borrowers in that bigger institutions are 2016 and recently “... the biggest problem is finding new customers to better able to cost-effec- announced it had tively acquire customers, handled $4.5 billion lend to.” Sioukas said established in loan requests. The lenders are also grappling company charges Dean Sioukas with customer acquisition, lenders a monthly Magilla Loans especially in small business subscription fee to lending. access requests for “The mid- to big-size capital from borrow- be affected by changes in the players in banks had abandoned small ers. Sioukas said they do not add trans- SME lending. business lending,” he said. “Now most action fees to be paid by borrowers. “It’s “It’s definitely on our radar,” Siou- of the banks I’ve talked to say the big- free to borrowers,” he said. kas said of big bank moves into small gest problem is finding new customers In addition to surveying lenders, business lending. “But we don’t have to lend to.”

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