Online Lenders Make Attractive Buying Targets for Banks

Online lenders have felt the brunt of the current crisis as many of the platforms operate on a marketplace model where investors buy the loans; when investor money dries up the platforms no longer have the capacity to lend; publicly traded lenders like OnDeck, LendingClub and GreenSky have all seen their stocks plummet since the beginning of 2020; an investment banker explains to the FT, “The banks don’t necessarily like the platforms as businesses because of the liability funding structure, but would look at them because of the technology — they look at them as a capex replacement or a lending engine.”; with values becoming more and more attractive by the day for potential buyers the question is who will be the first bought and can any survive long term? Financial Times

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