Small business lender OnDeck forms reporting and analytics partnership with Orchard.
OnDeck, one of the largest fintech lenders to small businesses in the US, has announced a partnership with specialist access portal Orchard Platform. The new arrangement will see Orchard manage reporting on behalf of OnDeck for institutional investors that are purchasing loans through the platform.
OnDeck is what some commentators term a “hybrid” lending platform, in that it holds some loans on balance sheet, while distributing others through an institution-only marketplace sales programme.
Orchard is an access platform which helps to funnel institutional investor money into marketplace lending platforms in the US, while also offering automated data analytics services. The company says that the OnDeck tie-up will help to drive operational efficiencies by providing a universal view of standardised data through a suite of analytics and reporting tools. These include investor dashboards, portfolio benchmarking, automated daily holdings reports, and a custom report builder for internal and third-party analytics. These products sit within the Orchard for Originators tool-set.
"OnDeck Marketplace is an important part of our funding model, and we are constantly looking for ways to enhance our reporting and analytics capabilities to better serve our investors," said OnDeck CFO Howard Katzenberg. “Orchard helps us and our Marketplace investors monitor their loan portfolios by providing access to high-quality data and the tools required to easily understand that data.”
Today’s deal sees OnDeck join Orchard’s recently launched Data Partner Program, which offers third-party validation as to the internal consistency and quality of an originator’s data.
A slow-down in marketplace sales saw OnDeck’s financial performance suffer in the early stages of 2016. The platform sold 26 per cent of the loans that were originated in Q1 through its marketplace, down from 40 per cent in the fourth quarter of 2015. The gain-on-sale rate for these loans slipped from 9 per cent in Q4 2015, to 5.7 per cent in Q1 2016. The hope will be that the ability to independently represent the platform’s track record via the Orchard partnership will help to shore up investor demand.