Fintechs upbeat in the face of COVID-19
A handful of financial technology companies including a neo bank and a SME lender have emerged from lockdown with surprisingly upbeat views of the sector on Wednesday.
Lower-than-expected mortgage arrears and a sharper rebound from business borrowers were two of the surprise developments revealed during a webcast – focusing on banks and payments – held by Morgan Stanley.
Nathan Walsh, co-founder and CEO of home loan disrupter Athena, said the non-bank lender had deferred payments of just 0.15 per cent of its total mortgage book compared with rates of between 5 per cent and 10 per cent among the big four.
“Our strong credit quality reflects our target market of prime home loans … but also the strength of our digital platform and underwriting processes,” he said.Good news wasn’t limited to the residential mortgage sector, however, with signs of green shoots emerging across the business lending segment.
Aris Allegos, co-founder and CEO of specialist SME lender Moula, said demand was picking up after a “somewhat unpleasant” late March and early April as the pandemic was declared and the nation went into lockdown.
“It has improved dramatically. Our data suggests that small businesses are coming back to life and operating at a rate that while not equivalent to pre-COVID rates are not at all what we expected,” he said.
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