How to Lend Money to Strangers

Most consumers have a fairly steady income stream that turns hours into wages on a weekly, bi-weekly, or monthly basis. Sure, we hope those payments rise over time, but still, we’re typically talking in terms of percentages per year. And when we borrow, it's usually to spread a large expense into a series of smaller payments that better aligns with their earnings. It’s different for SMEs, though....

Bartek Staszewski has seen the credit industry change during his career, but he's also seen his country change, and in the amplification of those two forces there's plenty of insights for all of us. Join us as we start Money20/20 week with a discussion of the Polish consumer credit landscape and about lessons learned from the coal face of one of the most changed markets in the world. You can learn...

“So how is it that we can make credit more equitable and affordable? The question hasn't changed, it is the answer that needs to change.” In a traditional model, the end-to-end cost of consumer credit involves the merchant paying a commission to the credit card company for facilitating the payment, the consumer paying the credit card company fees and interest for maintaining a line of credit, and...

When I first conceived of this show, I actually assumed it would be more academic in nature, more about the practical 'how' than the strategic 'how' as it were. When it went live, though, it quickly became clear that it would be more about fintech, more about uncommon global viewpoints. But that's not to say that I don't still love getting into the weeds of credit scoring minutiae! So I am delight...

I've been an immigrant three times: into Denmark with Experian, into Hong Kong with HSBC, and most recently into the UK with TransUnion. So, I understand some of the issues immigrants face, but you'll also notice that each of my moves was made under the wing of a big financial services company, which made for soft'ish landings. Most people don't have the same support. And it is not just about gett...

A credit risk specialist with over two decades in credit risk spread across Canada and the US, Frank Tian now writes, teaches, and consults on a wide range of lending risk management topics - so in this episode, I pick his brain, delving into everything from content to creation to the regional bank crisis and how AI might actually be the productivity boost we need to navigate ageing populations in...

☝️ Click above ☝️ to follow the show, it is pretty much the only thing that keeps the show visible and it makes me very happy. Paydown curves are one of my favourite things. Get a few glasses of wine in me and the right audience at an industry event, and I'll happily chat about them long into the night. The thing is, they can create the impression that there's only one route to Present Value = 0 A...

Stephen Hawking starts A Brief History of Time with an anecdote he attributes to Bertrand Russel who, having just finished a lecture on the heliocentric nature of the planets’ orbits, was challenged by a lady in the audience. “What you have told us is rubbish.” She said, “The world is really a flat plate supported on the back of a giant turtle." "If your theory is correct, madam," Russell replied,...

Last week I compared credit bureaus to city walls, defensive structures that, because they’re solid and immovable, can keep the riskiest of customers out, but, also because they’re solid and immovable, can’t always let all the good customers in. Today, we look at those walls from the inside, and it turns out, their design is keeping some defenders out, too. Let’s say the first step is too high for...

About five years into my time in Hong Kong, I slipped my foot into a shoe only to bump into a frog sleeping inside it. Rough calculations say that, by that stage, I’d slipped a foot into a shoe 3,650 times in the city so the odds were greatly stacked in my favour. And yet, so great was my shock, and so increased was my awareness of what might slip under the door, that I checked every shoe every mo...

I scheduled this episode to follow the Honey Badger episode because I liked the alignment of their names, but I could just as easily have linked it to the Wine Funding episode, because we're once again turning engaged fans into even more engaged financiers! Only this time, we're taking all comers. So when George says Honeycomb is "helping business owners really activate this community of customers...

I'm bad at passing KYC checks. I know the classics, mother's maiden name, first pet, colour of my first car, all that sort of stuff. But, chances are, so do the fraudsters. Where I struggle is the financial data that banks now use, I simply don't pay that close attention to what they name their products, I don't know if my wife having a secondary card means I have two credit cards or one, I don't...

When you lend someone money, you give up the usage of those funds - temporarily if things go well, permanently if they don't - and so, to make it worth your while, you charge the borrower interest. That's just business. But sometimes business is good to you, and instead of your interest being paid in boring old Euros, you get paid in fine wine! That's the concept behind WineFunding , the world's f...

When Naureen Hyat and Humza Hussain joined forces with Nadeem Hussain, the founder behind the world’s second-largest branchless banking solution, they decided to pivot their B2B microfinance business towards the consumer, giving rise to Tez, the first FinTech in Pakistan to get a digital lending licence. They made mistakes quickly and learned from them, creating a scalable and digital lending mode...

This whole show is built on the premise that lending money is a tricky endeavour, but, let's face it, borrowing money can sometimes be easier said than done, too: instalment or revolving, secured or unsecured, long-term or short-term, monthly cost versus APR, affordability versus need, etc. There's a lack of transparency and a lack of knowledge. "And when there is a lack of knowledge, there is a l...

Imagine you rent your home.  Now imagine your landlord gave you a straight choice: (1) pay rent for forty years, renewing the lease biennially for the rest of your life, or (2) pay the same rent for thirty years at the end of which your landlord gives you the house. Pick your answer, but don't tell me yet, because I have one more pair of choices for you, this one from the funding side of...

This is a special episode for two reasons: (1) it is my long-awaited debut in Australia, a market that's slipped through the gaps for too long on this show, and (2) it's a birthday bonus episode. Well, no, actually, it's actually special for three reasons, because it is also a story about taking chances. First, someone had to take a chance on Oli, when he was a restaurant manager looking for a cha...

The fact that it takes 45 days to close a mortgage in America today is not just a one-time hassle for home buyers, it can be a source of ongoing compounding costs. Nobody wants that, least of all Eilon Shalev my guest today and the co-founder and CEO of Elphi , a fintech that wants to bring that down to fifteen days. “Elphi is a technology company. We provide enterprise software as a service to mo...

Alif Bank has grown into one of the leading fintechs in Central Asia; and with its portfolio of Sharia-compliant lending, payments, and banking products it's showing that fintech can be based on noble values. Alif Bank and all its products can be found at www.alif.tj (click the link to jump to English) or on LinkedIn at https://www.linkedin.com/company/alif-capital/ Abdullo himself, who you've hea...

So you want to own a boat but you don't know how to finance it? Then we've got you covered. I'm in Venice with the family this week, a city more closely linked to boats than almost any other. That's a coincidence. We're not talking about gondolas or cruise ships, today, but we are talking about pretty much every vessel in between. You can read more about Salt and its launch at https://www.salt-fin...

"Retailers are obsessed about consumers." And it is by leveraging the fruits of this obsession, their understanding, that retail creditors can take on the bigger, more cheaply-funded banks RCS is found at https://rcs.co.za/ and they're on LinkedIn, too (plus Facebook and Instagram ) Mobicred is at https://mobicred.co.za/ Read more about the RCS rising star tennis academy at https://www.tennissa.co...

When I moved to Scandinavia, Finland quickly became one of my favourite countries to work in. That much colder than my home in Copenhagen, it was where I first experienced 'proper snow'; visiting Helsinki before Moscow, meant it was where I got my first up-close experience of Russian-Byzantine architecture and a sense of being truly far from home; and thanks to its stoic people, it taught me to pr...

In any property transaction, you need a willing buyer and a willing seller. What you don’t need, but almost always have, is a disinterested lender. That third wheel can be problematic, so Paul Watts is trying to get rid of it via owner financing for home builders. As Paul mentioned, Lenuity’s home page is at https://lenuity.co.uk/ but you can also find him on LinkedIn You can learn more about Barc...

Developing markets have a reputation for being unavoidably high-risk for lenders. And sure, developing markets are associated with less stable employment which can undermine repayments but in reality, how much of the observed historical losses could be avoided by embracing local knowledge and implementing better collections? It turns out, quite a lot of it. And by better collections, mind you, I d...

“AI is not something that's come around today, right? What has changed is our ability to store an enormous amount of data economically; the processing speeds; and the speed of transmission of information. Those three in combination are the most fertile ground to bring AI to life.” As we’ve heard on this show before , AI as such is not a new tool, but it is now really coming of age. And today’s gue...