The online lender said it applied insights from its partnership with Fifth Third Bancorp in developing a new digital platform it’s marketing to other large financial services companies.
The online lender has acquired NextGenVest, which uses AI and text messaging to advise high school and college students about getting loans. CommonBond’s goal is to better understand the distinctly different demographic group rising behind millennials.
Cheap funding and marketing muscle could give it an advantage over existing lenders, but this corner of the market may not be big enough to move the needle for the bank.
Introducing limits on federally guaranteed loans to graduate students, instead of letting them borrow whatever schools charge, would create a multibillion-dollar opportunity for private lenders.
The tighter spreads on the fintech student lender's latest securitization should help offset a rise in the underlying benchmark rates, keeping its funding costs low — and helping it compete more effectively.
In a Q&A, CommonBond CEO David Klein discusses how an OCC charter might benefit customers by lowering the cost to run a student loan refinancing business.
