At the Rules of Thumb blog from MoneyThumb, we have many non-traditional lenders who use our product, PDF Insights, to help them make quicker and better-informed lending decisions. So it is imperative to us that we keep our blog readers who are lenders informed and educated about matters of importance to you.
This 12-page PDF that covers the results of a survey by Deloitte Insights is something we feel strongly that our lending readers will want to take the time to read. The PDF is titled Funding Takes Center Stage for Non-Bank Online Lenders. Of 34 non-bank online lenders who were surveyed, a whopping 77% said that cost of funding was their top concern in running their business. The second concern was liquidity, the third top concern, inability to diversify.
The survey also found that the larger the size of the non-bank lender, the easier time they had with the cost of funding, which is not surprising. What is surprising is the fact that the number of private lending startups has decreased, implying the market as a whole is maturing and that online lending has become a fixture of the overall lending ecosystem.
As far as the trend of larger lenders having an easier time with the cost of funding, the survey offers good news for smaller online lenders in that the investment appetite for online lending continues to grow steadily overall.
In the wrap up of the survey, Deloitte Insights offers several savvy tips for smaller online lenders who are challenged by the cost of funding. These tips are listed below:
- Smaller, non-bank players in the online lending industry could fare well in a down cycle by pivoting to lending as a service, (LaaS.) Some smaller online lenders have done this and the middle banking market has been receptive.
- Non-bank lenders can partner with each other, with other types of fintech, and with banks to expand their relationship with customers and to develop products and services such as budget apps, wealth management services, and even deposits.
- Focus squarely on optimizing their capital structure by partnering and integrating with the broader financial ecosystem.
Of course, we'd be remiss if we didn't add what we feel is one more way that smaller online lenders can improve their overall business, and that is by using PDF Insights from MoneyThumb. you won't believe the time and headaches you will save by using this product to help you in your lending decisions!
MoneyThumb's enterprise-level PDF financial file converters allow private lenders to automatically convert bank, credit card, and brokerage statements into the needed formats to quickly determine an applicant's loan worthiness. Our conversion tool most used by private lenders is PDF Insights. This PDF financial file converter is specifically designed for lenders, and outputs captured data into a standard format for automated consumption into the lenders' bank system. PDF Insights utilizes IDR (intelligent document recognition) to identify bank/statement formats.
Unlike competitors, our solution doesn’t need to be told upfront which bank or format is being used, yet correctly processes over 99% U.S. statements. The output is delivered in a standardized format, even for statements from different banks. Our automated statement reconciliation feature compares transaction totals to summary information on the statement. If all information on the statement is consistent, PDF Insights will identify the statement as reconciled, meaning you don’t have to spend time manually reviewing statements to identify inconsistencies.
We would appreciate it if you would share this blog post with your lending peers on social media so that they too can read the survey from Deloitte Insights and learn more about MoneyThumb and our software designed specifically for lenders.