Lending

Nubank is now a certified Fintech Unicorn said to be valued around $10 billion. In fact, Nigel Morris of QED Investors called Nubank the most successful digital bank on the planet. “It came from nothing,” he said. QED lists Nubank as one of their many Unicorn investments.

Nubank began with online lending and then added more services like checking accounts and more recently asset management. While initially launched in Brazil, Nubank is now operating in Mexico, Colombia, and Argentina. You can expect Nubank to set up operations in other continents.

While digital banking may seem obvious to both a casual observer as well as a Fintech expert, Velez shared some of the skepticism he encountered by traditional financial services types when he first decided to become a Fintech entrepreneur.

Consumers were paying very high fees and very high-interest rates. Of course, things were good for the establishment banks which operated in a bit of an oligopoly.

In 2012, he said the experience of visiting a brick and mortar bank was of waiting in line for an hour to enter a branch, under high security, and then waiting four to five months to get an account. This type of poor service was taking place at the beginning of the smartphone revolution when internet penetration was shooting through the roof.

Importantly, about 25% to 30% of their customers use Nubank as their primary bank account – a good percentage – but that still leaves around 70% that use an old bank for their financial services. Velez sees this as a huge opportunity. And that’s their mission in the countries where Nubank operates.

.

U.S. fintech Self Financial secured $40 million through its Series D investment round, which was conducted by Meritech Capital with partaking from Altos Ventures, Conductive Ventures, and Silverton Partners. According to Self, the investment round brings its total funds to $77 million and comes on the patch up of its $20 million Series C investment in February.

Founded in 2015, Self defines itself as a venture-backed fintech startup with a aim to help people develop credit, particularly those who are new to credit or who might not have admittance to traditional financial products.

“Self provides tools for its customers geared toward building positive behaviors (such as on-time payment history and responsibly using credit) and long-term success, working in partnership with its issuing banks. With the Self Credit Builder Account consumers simultaneously tackle both credit and savings without requiring a hard credit inquiry or credit history. The Self Visa® Credit Card is a unique secured credit card that doesn’t require a credit check and provides existing Self customers the ability to build their security deposit in installments rather than a large upfront deposit.”

Financial credit app Updraft has managed to raise £16m to expand its business, with part of the funding coming courtesy of the UK Government.

Specialist investment firm Quilam Capital is also providing to the fund. Although exact figures on how the disclosed £16m has been split are unknown, the Future Fund initiative provides loans between £125k and £5m.

Providing customers with a holistic view of their finances, a method of automating decisions and no overcharging fees, the company’s app managed to accrue a 40,000 person waiting list prior to release; it is now available from the iPhone app store.

US Based Mortgage fintech startup Tomo Networks has raised $40m in seed funding. The funding round was led by Ribbit Capital, NFX and Zigg Capital. Other individual investors, who also participated in the round include, hedge fund luminaries Alex Sacerdote, Kurt Mobley and Eli Weinberg, former Zillow CEO Spencer Rascoff, and Ackerley Partners’ Ted Ackerley.

Tomo Networks was founded by CEO Greg Schwartz and CRO Carey Armstrong, former executives at online real estate firm Zillow. It aims to sit neatly between consumers and real estate agents to streamline the often byzantine financial processes at the heart of buying a home.

The company says it will remain human-driven, but technology-enabled. It aims to bring a system that pre-empts and levels out friction during the mortgage process.

Funds will be used for a nationwide hiring process in the US, with plans to centre teams in Austin, TX, Seattle, WA, and Stamford, CT.

Possible Finance, a Seattle-based digital short-term lender for people with poor credit, has been adjusting to the Covid-19 economy, raising $11 million in funding via Zoom calls and making the long-term switch to remote working.

Possible lets people borrow up to $500, using real-time bank data, rather than credit scores, to make lending decisions.

However, it distinguishes itself from payday lenders by giving borrowers longer to pay back their loans and by helping them build up their credit score by reporting installment payments to the three major credit bureaus.

The firm says it closed an $11 million Series B funding round earlier this year, bringing in lead investor Union Square Ventures after a series of Zoom calls during the lockdown.