Marketplace Lending News Roundup – April 4th, 2020

News

During the week I share the latest marketplace lending and fintech news on Twitter as it happens. Then every Saturday I take the most interesting news items and blog posts from the past week and share them here.

People Need Loans as Coronavirus Spreads. Lenders Are Making Them Tougher to Get by The Wall Street Journal – Telling quote from Jared Hecht in the Wall Street Journal: “Lenders have zero idea how to assess risk in this environment”. There is no model for where we are right now which is why most (all?) lenders are tightening lending standards.

A Global Consumer Default Wave Is Just Getting Started by Bloomberg – To get some idea of what we might be in for look at China. Last month past due credit card debt was up 50% from a year earlier as China has seen an explosion of consumer credit in recent years.

Digital training for bankers paying off in coronavirus crisis by American Banker – Those banks that have made digital initiatives a priority in recent years are the ones better prepared to support their customers today.

70 million people can’t afford to wait for their stimulus funds to come in a paper check by Brookings – For those people without a direct deposit on file with the IRS it is going to be a long wait for a stimulus check. Meanwhile, they will be forced to seek payday loans or worse. But as Aaron Klein points out there are things Congress can do to help.

How fintech can save small businesses on the brink by American Banker – As Jo Ann Barefoot points out in her American Banker op-ed innovative companies can help solve many of our pressing financial challenges. AIR’s hackathon this past weekend was to build prototype tools to accelerate and scale up small-business rescue funds.

A National Overdraft Program: How To Provide Fast COVID-19 Relief To People Who Need It The Most by Forbes – Here is an idea that is simple to implement that will help give financial relief to those that need it most: a national overdraft program. It should come with some strings attached, though, says Ron Shevlin.

Microsoft will launch personal finance app with assist from Plaid by American Banker – It is good to have some real fintech developments to report on this week unrelated to what is going on. Microsoft has teamed up with Plaid to create a consumer finance app inside Excel that will launch later this month.

The Rush for $350 Billion in Small-Business Loans Starts Friday. Banks Have Questions. by The Wall Street Journal – This is a travesty SBA. From The Wall Street Journal today: “most of them [lenders] are saying, given what they know today, their likelihood of participation is getting smaller and smaller”. The PPP is not going to work as it now.

Chime pilots way to get $1,200 stimulus checks to users instantly after talks with Mark Cuban by CNBC – Here is some positive news from the frontier of fintech. Chime is piloting a way for its customers to receive the $1,200 stimulus checks instantly, weeks before they are sent.

Small banks struggle to get SBA to return calls, process emergency loans by American Banker – The rollout of the Paycheck Protection Plan has been anything but smooth as many banks simply can’t get through to the SBA.