Each quarter, KPMG reports on the pulse of fintech investment globally. The analysis highlights key fintech deals, issues and challenges seen around the world, in addition to key trends and insights related to fintech in key regions, including the Americas, the US, Asia and Europe.

Here's a snapshot of “The Pulse of Fintech Q12017:

Marketplace lending is a dramatically simpler way for Lenders and borrowers to connect.

The availability of an online marketplace where lenders and borrowers has allowed for lower borrowing costs for borrowers and higher yields for lenders as the layers separating them are reduced.

Marketplace lending allows for lenders to directly partake in the consumer lending market which was earlier only the purview of banks and other financial institutions.

Through the use of machine learning and advanced analysis, marketplace lenders are able to ensure that default rates are minimized.

Source: Dianrong.com

Source: Dianrong.com

FICO Scores help lenders quickly, consistently and objectively evaluate potential borrowers' credit risk.

Currently being used by over 90% of US lenders to predict consumer likelihood to pay back loans they have proven their value over time.

FICO scores are a type of Credit Score. A credit score is a number that is used to predict how likely the borrower is to pay back a loan on time. Credit scores are used by companies to make decisions such as whether to offer you a mortgage or a credit card. They are also used to determine the interest rate on a loan or credit card, and the credit limit. 

With multiple factors contributing to an individuals FICO score they are an excellent way to get a holistic view of a persons credit worthiness.

Components of a FICO Score

Components of a FICO Score

Source:  Company data,P2PGI,Victory Park, British Business Bank, Morgan Stanley Research, Forbes

Source: Company data,P2PGI,Victory Park, British Business Bank, Morgan Stanley Research, Forbes

Institutional Investors in the US are seeing the value in Marketplace lending and allocating a portion of their investment portfolio towards it. 

Some of the highlights recently are:

•Blackrock invested USD330MM in 2015

•Goldman Sachs opened Marcus in 2016 which focuses on Consumer loans

•Soros invested USD5B to fund consumer loans in 2016

•Credit Ease Group, which runs a wealth manager and peer-to-peer lender Yirendai Ltd. in China, invested USD50MM in 2016

•JPMorgan works with Marketplace lender to help originate loans for part of the bank’s four million small-business customers.