Fintech News: May 13th, 2016

This week in fintech: JPMorgan fires back against startups who pull their data, an investment platform specifically for women, how marketplace lending dug itself into a ditch, and new regulations facing roboadvisors.

Jamie Dimon Wants to Protect You From Innovative Start-Ups (The New York Times)

Screen Shot 2016-05-13 at 9.34.36 AM.pngCorrection: Jamie Dimon wants to protect JPMorgan from Innovative Start-Ups. In a letter to shareholders, he criticized companies like Acorns and Mint for “taking more customer data than they need to” and selling it. The startups claim this is ridiculous, since they pay for consumer data by the month, so pulling more than they need would be too costly.

Former Citigroup CFO launches Ellevest, a digital investment platform for women (TechCrunch)

howitworks_step5.pngThis Fintech startup is helping break the gender bias in investing. Created by a former Citigroup exec, Ellevest isn’t just a “pink it & shrink it” platform. It’s an investment planner that considers realities for women, like taking time off to take care of children, a different salary arc, and a longer average lifespan. The last step to setting up your account? “Go have a glass of wine and enjoy yourself – we’ll let you know if you fall off track.”

 

Fintech Needs to Expand the Club (Bloomberg Gadfly)

How long did marketplace lenders expect to get away with APRs as high as 98% without regulators noticing? And how long were investors going to buy these loans for, without a secondary market to sell them on? Just like the wild west that is algo trading, it’s time for the CFPB to get up to speed on lending platforms.

Screen Shot 2016-05-13 at 11.21.40 AM

Source: Bloomberg

The technology-driven transformation of wealth management (TechCrunch)

Robo-advisors are great for young people without specific goals, but their client “risk profiles” are too vague for mass affluent investors, who have specific retirement goals and complex financial pictures. Now, a new Department of Labor law may tell robo-advisors to learn more about their clients by enforcing stricter standards for what is considered “suitable” financial advice.

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