Consumer credit platform secures $600m facility

By Ryan Weeks on 17th May 2018

Alternative Credit

LendingPoint has now raised up to $1.1bn of senior credit financing in less than a year.

Consumer credit platform secures $600m facility

Fintech lending firm LendingPoint has secured a committed credit facility of up to $600m, arranged by Guggenheim Securities.

It is the second time in the past year that LendingPoint has secured a major facility. It closed a similar deal for up to $500m in September of last year, again arranged by Guggenheim.

Guggenheim is the investment banking and capital markets division of Guggenheim Partners.

LendingPoint offers loans to US consumers. It specialises in online loans of $2,000 to $26,500 in size with terms of 24 to 48 months, and point-of-sale loans of $500 to $15,500 in size with terms of 12 to 60 months. The platform funds loans using its balance sheet.

LendingPoint makes great play of its ability to look beyond traditional FICO scores when assessing creditworthiness. The firms claims to use ‘dozens of APIs’ to gather data points on applicants, which it uses to create a more complete picture of a customer’s standing. Its focus is on near-prime borrowers.

The firm processed credit requests equal to more than $9.2bn in potential lending in the first quarter of 2018. It has lent more than $500m to date, spread across over 50,000 loans.

“The sizes, advance rates and interest rates of our credit facilities are a testament to our portfolio’s outstanding performance to date,” said Tom Burnside, co-founder and CEO of LendingPoint, in a statement. 

“This blended interest rate on this most recent facility is exceptionally low – LIBOR plus 467 basis points – and the advance rate is 90 per cent, underscoring that our lenders’ believe that our credit-first, balance-sheet business model works. When we started LendingPoint, we knew that by successfully solving lending for people with credit scores between 580 to 700 – those we call ‘NearPrime’ – we would maintain strong capital markets support. This new Guggenheim facility and its pricing confirms that we’re succeeding.”

 

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