Today, CFSI and Core Innovation Capital released "Financial Technology Trends in the Underbanked Market." This new report identifies four key trends impacting the underbanked market: harnessing social networks, solving the cash in/out problem, leveraging big data for better risk management, and scaling up by going B2B2C (business to business to consumer). 

Each of these trends is analyzed in the context of five FinTech industry factors relevant to growth and profit potential, such as the regulatory environment and consumer behavior trends. The report also highlights companies leveraging these trends for the underbanked market, including a specific company case study for each trend.

Last night, CFSI, Core Innovation Capital, and Morgan Stanley brought together investors, operators, and industry stakeholders to discuss the key financial technology trends driving investment opportunities in the U.S. underbanked market. Rob Levy, Director, Research, CFSI, provided an overview of the report. Arjan Schütte, managing partner of Core, moderated a panel discussion with entrepreneurs included in the report. Panelists were:

• Robert Frohwein , CEO and founder of Kabbage
• Mark Hookey, CEO and founder of Demyst.Data
• Steven LaBella, President, CEO and founder of iSend
• Patrice Peyret, CEO and founder of Plastyc

Read the report here on CFSI's website. Primary authors are Rob Levy, Arjan Schutte, and Eva Wolkowitz, Research Analyst, Insights & Analytics. 

The report was sponsored by Morgan Stanley and has benefited greatly from the company's strategic input.

FinTech FaceOff will appear at the 2013 Forum when exciting new FinTech entrepreneurs will pitch their companies to three insightful judges: legendary founder of Capital One and FinTech investor Nigel Morris, national financial services columnist Felix Salmon, and former regulator and CFSI Board Chair Ellen Seidman. Their job: to determine which businesses are missionary, mercenary or visionary. The companies presenting are SoMoLend, Cognical, Quippi Corporation, and Glyph. Join us at the Forum and enjoy as these companies compete with their best pitch and our expert judges vote on the most promising investment. 

 _________________

Yesterday, Core Innovation Capital announced the eleven finalists for the 3rd Annual Core Innovators Mega Challenge. Chosen from a record number of applications, this select group of financial technology entrepreneurs will compete on the Forum's main stage to be named the most promising new idea serving the Emerging Middle Class. 

Core Innovation Capital managing partner, Arjan Schutte, believes the finalists selected represent a broad range of compelling services and opportunities for the 80 million underbanked consumers in America today. The finalists are: 

• iSend (Middlebury, CT)
• Nexxo Financial's Underbanked Platform (Burlingame, CA) 
• PayPerks (New York City, NY) 
• Mitek (San Diego, CA) 
• TrustEgg, Inc. (San Diego, CA)
• Enova International (Chicago, IL) 
• Fuze Network (Salt Lake City, UT)
• LendUp (San Francisco, CA) 
• OpenCoin (San Francisco, CA)
• SaveUp, Inc. (San Francisco, CA) 
• Yattos.com (San Francisco, CA) 

Join in on the buzz on Twitter by following #FreshIdeas13. 

CFSI's research in the area of small-dollar credit (SDC) is particularly poignant in light of the proposed guidance regarding deposit advance credit recently issued by two federal bank regulators, the OCC and FDIC. CFSI is currently in the middle of a multi-year SDC research initiative intended to deepen understanding of the SDC consumer and to promote consumer access to high-quality credit products. Last year, CFSI published findings from a survey of over 1,100 small-dollar credit consumers, including deposit advance users, to better understand this consumer's credit needs and decision making. CFSI's past research points to both the potential of the deposit advance product to meet consumer's credit needs, finding that users rank deposit advance loans favorably relative to many common SDC sources, and to the need to address concerning levels of repeat borrowing and long-term indebtedness among many customers.  

In the months to come, CFSI will report on new, in-depth qualitative research of SDC consumers, including deposit advance users, in order to dig more deeply into the lives, needs, and circumstances of these customers. We will also highlight their experiences with several innovative SDC products, including those with extended loan terms and installment payment options. Stay tuned for more.