survey Archives - Lend Academy

New J.D. Power Survey on Personal Loan Satisfaction

The new report looks at traditional banks and fintechs alike.

April 4, 2019 By Ryan Lichtenwald 1 Comment

Last week J.D. Power released a study on personal loan satisfaction. At a time when credit card debt is rising and in turn personal loan volume is reaching an all time high there are no shortage of options for consumers. The J.D. Power 2019 Personal Loan Satisfaction Study found that many alternative lenders are winning on customer satisfaction against many traditional banks but there are also some names that may surprise you.

There are many factors at play, but most often these companies have superior digital experiences and faster time to fund. Topping the list is none other than Marcus by Goldman Sachs which beat out the pioneers of online lending such as Lending Club and Prosper. What’s surprising here is that their personal loan product was released most recently out of all of the companies which shows the careful approach they took when they entered the personal loans business back in 2016. Lightstream (a division of SunTrust) and Upstart rounded out the top three.

J.D. Power 2019 Personal Loan Satisfaction Study

This is the inaugural study for J.D. Power so it will be interesting to see how the results shift over the coming years as the banks who have ranked lower work to improve their offerings. The survey was based on responses from 3,413 personal loan consumers. You can access the 2019 report on the J.D. Power website.

Below are other key findings of the survey:

Alternative lenders pose threat to HELOC market: Overall customer satisfaction with personal loan providers is 853 (on a 1,000-point scale). By contrast, the average customer satisfaction score among HELOC customers in the recent J.D. Power 2019 Home Equity Line of Credit Satisfaction Study^SMis 834, with lower satisfaction correlating to fewer customer referrals.
Customers perceive lenders as profit driven: When rating brand image, customers have clear perceptions that all lenders are relatively profit driven, with significantly deeper concern among customers of alternative lenders. Similarly lacking across the board are positive customer perceptions of reasonableness of fees and competitiveness of rates. Alternative lenders also rate significantly below their bank competitors in these two areas.
Digital applications lead to better understanding and higher satisfaction: Digital is the most common channel used for a personal loan application, with 40% of personal loan customers applying entirely online. Overall satisfaction is highest among personal loan customers in the digital-only segment (886), which also has the highest percentage of applicants who indicate that they completely understood the application (91%). A complete understanding of the application is associated with a 137-point increase in customer satisfaction.
Fast and efficient funding is critical: Receiving loan approval within two days is associated with a 55-point jump in customer satisfaction, and receiving funds within two days of approval is associated with a 50-point jump in customer satisfaction. By contrast, customers report the total average time for HELOC funding to be approximately 26 days from the time of application.
Customers will consider alternate products: Despite the reported benefits, customers choosing personal loans are still not locked in to the product when shopping for their loan. Nearly half (47%) of such customers also considered competing products; 28% considered credit cards; 17% considered personal lines of credit; and 13% considered HELOCs.

Please Take the Lend Academy Reader Survey

The short survey will only take two minutes and will provide Lend Academy with valuable feedback

November 30, 2016 By Peter Renton Leave a Comment

It has been several years since we have done a reader survey here at Lend Academy and a lot has changed. We are about to make some enhancements to Lend Academy for 2017 but before we do that we want to take the pulse of our readership.

This is only a short survey so please spend just a couple of minutes of your time giving us feedback. You can take the survey here.

And thank you.

New Report on Bank Partnerships with Fintech Companies

The new report, commissioned by Manatt, shows that collaboration is the likely way forward for banks and fintech companies

October 24, 2016 By Peter Renton Leave a Comment

A new report released today by the law of firm of Manatt, Phelps & Phillips, LLP shows that community and regional banks are very open to partnering with Fintech companies. The report is based on information gathered in a survey of 75 executives from banks, Fintech companies and private equity investors. While the survey size is very small the findings are still quite interesting.

The main thrust of the survey is that banks are far more open to partnering with Fintech companies than ever before. This is a trend that began many years ago and seems to be accelerating today according to this report. Here are some of the key findings of the report:

Banks are on board with fintech. At 81%, the overwhelming majority of regional and community banks are currently collaborating with fintechs. In addition, 86% of regional and community bank respondents said that working with fintechs is “absolutely essential” or “very important” for their institution’s success.

Lower costs + a better brand = a win-win. For regional and community banks, enhanced mobile capabilities and lower capital and operating costs were highlighted as the benefits of collaborating with fintechs. Fintechs named market credibility and access to customers in regional markets as the main benefits to partnering with banks.

Data security remains a challenge. Both banks and fintech companies are highly sensitive to the ways in which data is shared and secured. This means extra attention must be paid to cybersecurity when the two sides collaborate—especially given the cultural mismatch that can exist between them. Despite the optimism among banks for collaboration, preparedness is a large concern. Almost half of regional and community bank respondents said they are just “somewhat prepared” or even “somewhat unprepared” for this kind of partnership.

Regulatory concerns remain paramount. For banks and fintech firms, structuring relationships that are regulatory compliant, including, if required, prior regulatory approval, is critical to ensuring success and the opportunity to change the way financial services are ultimately delivered.

So, assuming this report is representative of the attitudes of all of banking we can expect far more collaboration in the future. I think this is good news.

[Read more…]

Just Released: The 2015 UK Alternative Finance Industry Report

The latest report will give you an in depth understanding of the marketplace lending industry in the UK.

February 18, 2016 By Ryan Lichtenwald Leave a Comment

In November, 2015 we reported that the most comprehensive study was being conducted on marketplace lending for the Americas by the University of Cambridge. The same research center has just released their UK study of the entire alternative finance industry there. The report titled “Pushing Boundaries” was released today and was headed up by the Cambridge Centre for Alternative Finance at the University of Cambridge and Nesta. While the report shows how 2015 was all about pushing boundaries, the report proposes that 2016 is when alternative finance goes mainstream.

In total 94 companies participated and included many of the top companies in marketplace lending in the UK. The report highlighted three key themes: increasing market share, the real estate crowdfunding opportunity and fraud and malpractice fears. The full report can be viewed on KPMG’s website who also was a partner on the study. Below are a few highlights from the report: [Read more…]

The Most Comprehensive Study On Marketplace Lending Kicks Off

The University of Cambridge and University of Chicago launch the 2015 Americas Alternative Finance Benchmarking Survey

November 4, 2015 By Ryan Lichtenwald Leave a Comment

A new research study recently kicked off that will delve into the p2p lending and marketplace lending industry. With the industry maturing it’s important to take a look at where we are at today. Lend Academy and several other organizations have partnered to help make the most comprehensive survey ever on marketplace lending a success. We are asking all companies in the industry to participate by using the links below.

The Cambridge Centre for Alternative Finance at Cambridge Judge Business School and the Polsky Center for Entrepreneurship and Innovation at Chicago Booth School of Business are heading up the survey titled 2015 Americas Alternative Finance Benchmarking Survey. The study kicked off just last month and will conclude on November 10th. [Read more…]

Largest Survey of its Kind Shows Institutional Interest in P2P Lending

75% of respondents characterized themselves as already very familiar or somewhat familiar with the sector

June 1, 2015 By Ryan Lichtenwald Leave a Comment

From new platforms to institutional investors, there is no shortage of interest in the marketplace lending industry. However, we have yet to see such a survey conducted to gauge the true institutional investor interest until today. Richards Kibbe & Orbe along with Wharton FinTech shared today their 2015 Survey of U.S. Marketplace Lending.

We spoke to the co-authors Jahan Sharifi and Scott Budlong from RK & O as well as Steve Weiner from Wharton FinTech to learn more about the survey. They stated that the survey came about out of pure interest in the industry. They hope to help investment funds and investors get a better sense of the market. They believe the survey will help drive interest into the industry itself.

The survey outlined the growth of the industry with lenders issuing $5.5 billion of loans in 2014. They highlighted PwC’s projection that lending platforms could be issuing $150 billion or more annually within the next ten years.

They polled over 300 institutional investors with an approximate response rate of 30%. Almost half of the respondents polled work at funds with more than $500 million in assets under management, 10% had more than $10 billion and almost 40% had under $200 million. The survey aimed to to answer the following questions: [Read more…]

UC Berkeley and Lend Academy Partner on Groundbreaking Research Study

July 22, 2014 By Peter Renton 1 Comment

When I was in London in March I spoke on a panel at the AltFi conference with Richard Swart, a professor at UC Berkeley. He has become one of the leading academics focused on crowdfunding. We have stayed in regular contact since then as Professor Swart has decided to expand his research to include p2p lending.

This is great news for our industry because there has been virtually no research done in this country and there was no academic that wanted to take the lead here. Professor Swart, his team of researchers at UC Berkeley and I have put together a survey that we will be sending to all major platforms in the coming week.

The goal of this first annual survey is to quantify the broader online lending industry in several ways. Here is the official research description:

We seek to understand transaction size, volumes, and changes in markets for alternative lending. We are seeking aggregate loan or platform activity data that will be anonymized and aggregated so that readers of the final research report will not be able to determine the activity on any particular platform (unless the platform already makes that data public). This analysis includes gathering demographics of users – we seek to understand the demographic profile of users and track activity by metropolitan area. We do not seek personal data about individual loan recipients.

An additional survey will be focused on the self-reported information of small business owners who have taken out loans through online lending platforms. We want to get to the heart of the motivations of business owners to obtain financing and the impact these loans have on their business and the broader community.

Our new industry needs a benchmarking survey so everyone will be able to understand the evolution of online lending and its impact on the financial industry over time. I am honored to be helping out Professor Swart and his team at Berkeley on this important project.

Survey Will Be Open Until August 6th