During the credit pinch since 2008, alternative loans have
emerged to meet the needs of consumers and small business owners, and their
signs indicate sector expansion. Some estimate that by 2020, one of the five
small business loans will be provided by alternative lenders. That part of the
yen is $ 52 billion compared to today's $ 5 billion.
Not bad, but what will take us there? Fintech will promote
what development to enable these technology-friendly companies to lend more
money to more companies and offer viable alternatives to traditional business
finance.
There are
four trends to keep in mind for a successful online business loan
1.
Multi-product offer:
The largest financial institution in our country is a
full-service bank offering credit cards, personal loans, student loans,
mortgages, and small business loans, among other financial products. However,
to date, most online lenders have been left behind, but there are some notable
exceptions, such as the Lending Club, which operates in the private SME lending
sector. In the next few years, we will probably see more lenders offering
various types of loans online.
2. Banking
Association:
Banks have a large customer base, low capital costs, and
aspects of this aspect. Alternative lenders have room for speed, better user
experience, and regulatory control. They are natural competitors, but they
don't have to be. Several partnerships are beginning to be formed between banks
and online lenders, which will define how SMEs' credit needs will be met in the
future.
For example, the OnDeck and JP Morgan Chase Institute use
OnDeck technology and JP Morgan bank deposit data to provide SMB clients with
automatic signatures for small and medium-sized bank borrowers. A partnership
between the regional bank and the Foundation, where the Foundation is creating
a fully digitized application for regional bank customers.
3. The push
for self-monitoring:
When alternative lenders began to appear, it was an option
for everyone. The companies played according to their own rules.
However, in recent years, several self-monitoring
initiatives have emerged, from industry groups to industry announcements.
Innovative Lending Platform Association, Market Lender Association, Responsible
Corporate Creditors Association, Small Business Borrower Act: All
self-regulation attempts. As the online lending industry continues to mature,
we strive to self-regulate among the major players in the industry, as we must
practice and respect all the lenders or brokers that the borrower deserves to
possess.
4.
Strengthening government regulation:
Fintech is one of the hottest discussion topics, and it's
easy to see why. Banks and finance play a particularly sensitive role in our
economy while Silicon Valley startups are disrupting the taxi and mattress
industry. Therefore, last year, the Financial Supervisory Authority, the
Federal Trade Commission, and the Ministry of Finance published a study on
alternative lending.
Regulators have not missed the possibility that alternative
lenders have to innovate, or that inadequate regulation could soon lead to the
death of a large new industry. However, online lending has transformed a new
industry that is traditionally more restrictive.
It's difficult to say exactly how a business loan looks
online, but we can make sure that you are here to stay. These four developments
play an important role in FinTech's modern age and long industry change.
0 Comments