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Exaloan & Creditshelf: How digital SME lending adds value to an investor’s asset mix

Creditshelf & Exaloan: How digital SME lending adds value to an investor's asset mix

Frankfurt am Main, Germany, November 25, 2021 ‒ creditshelf Aktiengesellschaft, the leading financier for digital SME loans in Germany, and the data scientists at Exaloan AG confirm the added value of digital SME loans for the portfolios of institutional investors in a joint study.

 

Based on ECB data and the loan book of the creditshelf Loan Fund, the joint study elaborates the potential of the new asset class in the portfolio mix. Digital SME loans, such as those arranged by creditshelf’s lending platform, show a low correlation with other asset classes like equity, real estate, corporate or government bonds, and private equity. They are therefore ideally suited for further diversification of existing portfolios.


Dr. Tim Thabe, founding partner and CEO of creditshelf, explains: “We always knew that we are offering an attractive asset class for investors. Our new study with Exaloan officially confirms this. Especially companies of the German Mittelstand rarely have access to the capital markets and are therefore difficult to invest in by institutional investors. Through our platform, we offer a simple, digital and customizable way to invest directly into the German Mittelstand.”


In a volatility comparison, digital SME loans are significantly below other asset classes, even in comparison to a similar fixed income segment like corporate bonds. At the same time, they have much greater potential in terms of net returns. With the creditshelf Loan Fund portfolio, for example, the track record showed that investor returns amounted to up to 6% per year.


“We used bank lending data from the ECB to get a clearer picture of long-term return estimates for digital SME loans. When analyzing the data, we found that SME loans could be a great asset to include in an investor’s portfolio because they offer higher returns with a shorter duration than traditional fixed income securities like corporate bonds. By taking a close look at the creditshelf Loan Fund, we were able to validate our estimates with actual data. The study shows that institutional investors can benefit significantly from adding digital SME loans to their portfolio to enhance returns in a meaningful and stable way. Having the right tools to construct a diversified loan portfolio and control default risk is key, which is what our analytics engine is built for,” explains Luca Frignani, CEO and founding partner of Exaloan.

 

About Exaloan

Exaloan is the leading technology provider for institutional investments in digital loans. Its mission is to close the global funding gap for individuals, entrepreneurs and SMEs by connecting institutional capital with digital lending platforms. By operating a global B2B marketplace, the company opens up digital lending as a new asset class.. As an independent agent and validator, Exaloan provides a fully digital investment infrastructure with a standardized risk assessment of each single loan through its Loansweeper™ platform. At the core of its business, Exaloan uses big data and predictive analytics to generate an independent real time credit analysis as well as dedicated insights and reporting for institutional investors, banks, and lending platform partners. Insights cover topics such as sustainability reporting, advanced portfolio analytics, and market research.

Behind Exaloan stands an experienced team with extensive know-how in the areas of quantitative portfolio management, capital markets, machine learning, and software development.

 

 

About creditshelf

creditshelf is the leading financier for digital SME loans in Germany. Founded in 2014 and headquartered in Frankfurt am Main, the company arranges bank-independent, flexible financing solutions via a constantly growing network. creditshelf combines complementary needs: While SME entrepreneurs can easily access attractive financing alternatives, institutional investors can invest directly in German SMEs and partners can support their clients as innovative providers of new credit solutions. The core of creditshelf’s business model is a unique, data-driven risk analysis and unbureaucratic, fast and digital processes. Thereby, creditshelf covers the entire value chain: its platform is used to select suitable credit projects, analyze the creditworthiness of potential borrowers, and provide credit scoring as well as risk-adequate pricing. For these services creditshelf receives fees from both borrowers and investors.

 

creditshelf has been listed in the Prime Standard Segment of the Frankfurt Stock Exchange since 2018. The experts in the creditshelf team offer many years of experience in SME financing and are trusted partners and visionaries for the entrepreneurship of tomorrow.

 

 

 

To get access to the study please click the button down below or contact us directly at research@exaloan.com.

If you want to find out more, reach out to us.

We look forward to working with you!

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Exaloan Participates in Cisco’s Global Problem Solver Challenge 2021

Exaloan Participates in Cisco's Global Problem Solver Challenge 2021

2020 has been a tough year for everyone with many challenges that we were not prepared for. Despite all the difficulties, Exaloan managed to continue working, running its operations smoothly and achieving great things. In 2021, we aspire higher.

 

It is our pleasure to announce our participation in Cisco’s Global Problem Solver Challenge 2021 as a great way to kick off the year. What is the challenge about? At Cisco they aspire to identify and empower early-stage innovative technology solution providers to solve huge social and environmental problems. They aim for solutions that are not just going to make these problems disappear but will also stay persistent in our increasingly digital economy. Cisco truly believes that good ideas put in practice with digital technologies that bring together many devices and a bunch of data, always have the potential to make the difference.

With this support and cooperation, we would be able to extend and foster our outreach to even more regions where under-baking and a lack of financial inclusion hampers local economy and potential for individuals.

 

We have applied for the main challenges as well as for the digital inclusivity challenge and we are looking forward to having the first results in March of this year.

 

Check out our application video to see how we want to solve a global problem and close the global funding gap.

 

 

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Credit platforms and their key role in the context of global funding bottlenecks

Back in October, Exaloan became a member of the Association of German Lending Platforms, representing digital debt financing in this association. Earlier this month, we featured an article on their quarterly briefing where our CEO and co-founder, Luca Frignani together with our Business Developer for SouthEast Asia, Katharina Lentge, talked about the role of credit platforms in closing the Global Financing Gap.

Credit platforms and their key role in the context of global funding bottlenecks

 

Even before the pandemic, access to finance was considered one of the biggest growth hurdles for companies, especially in developing countries. Around half of all companies worldwide have no access to credit products. As a result, every year there is a shortfall of around $ 5.2 trillion in funding that investors could raise. In the coming months, this problem will increase further due to the difficult physical access to financial institutions and recessive tendencies. Financial inclusion as a development goal includes the responsibility to make affordable financial services available to the players in our economy according to their needs. Innovation in the form of digital marketplaces represents an opportunity to fulfil this responsibility and to close the structural gaps in our financial systems. By digitizing the credit process, credit platforms are significantly simplifying access to capital for borrowers and opening up new markets for investors. The allocation of financial resources can also be managed effectively through data-driven risk assessment and sensibly through the promotion of certain market segments…

To read the full article, please visit the Verband deutscher Kreditplattformen‘s website.

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Exaloan becomes a member of the Association of German Lending Platforms

Exaloan becomes a member of the Association of German Lending Platforms

Dear Exaloan Community,

We are very happy to let you know that we are now a member of the Association of German Lending Platforms (VdK). It is a pleasure for us to become a representative of digital debt financing in this association.

The Association of German Lending Platforms (VdK) has brought together a total of 18 members since its start in June last year. The core goal of the association is to bring together players that are working in the private debt environment. Through digital debt financing, private and institutional investors can invest in a variety of loans, bonded loans and bonds. Here is where the Association of German Lending Platforms comes into play by improving the supply of external capital, promoting financial inclusion as well as creating a positive impact in the economy. “I am very pleased to welcome Exaloan as a new member of the association. Even though Exaloan is not a platform in the traditional way, it contributes to its success through recognized expertise and various services. With Exaloan’s support, our association can keep presenting the digital debt financing even more intensively to political and media representatives.”– Managing director of the Association of German Lending Platforms, Constantin Fabricius said.

Besides continuing to offer its core services, Exaloan aims to contribute to the principles of the association namely integrity, professionalism, quality, and transparency. We look forward to working closely together and move towards achieving our goals.

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First anniversary of Exaloan

First anniversary of Exaloan

Dear  Exaloan  Community,
Today  marks a very important milestone for our team as we celebrate  Exaloan’s  first anniversary.  In turbulent times, we are happy to take a moment, look back and share our experience and thoughts throughout this journey that got us where we are today.

Exaloan is a Frankfurt-based Fintech that specializes in developing machine learning tools for predictive analytics in digital loans. We provide institutional investors with cutting-edge technology to connect and invest in digital loans on a global scale with full automation and standardization across the market, according to their own risk preferences.

It amazes us to see, how what started as an idea has now become a reality. Over the course of just one year, we managed to expand from humble beginnings to our current hardworking team, whose ongoing quest for insights and tireless commitment we appreciate deeply. It never fails to impress us to see how the ideas we drafted on paper at the start of the company now became a product and a working business model. A crucial step in our journey is to surround ourselves with a network of trustworthy partners sharing our vision, and we are very grateful to have PWC on board. Their valued expertise has helped us set up and streamline our business and processes. Through their contributions, we can deliver on our promise of facilitating the deployment of compliant capital in the digital lending market.

In February, we have also kicked off our global expansion with the acceptance and incorporation into the German Accelerator Program South East Asia, an initiative of the German Ministry of Economics and Technology. Their ongoing support is invaluable to us in strengthening our footprint in one of the most vibrant regions in the world. With offices in both Frankfurt and Singapore fully up and running, we feel well prepared to tackle any challenges that arise in the future.

The digital lending market is projected to continue to accelerate due to rising technology penetration which will foster the digitization of lending markets and financial service institutions. More and increasingly better data will become available, which will help both borrowers and lenders find together on fairer terms. These factors combined with the services that we offer in the digital lending market continue to drive our business model forward.

In conclusion, we are grateful and proud of how far we’ve come and eager to continue working on our vision to close the global funding gap. Enthusiasm and anticipation are building around new opportunities and we look forward to another successful year and all the milestones and achievements to come.


Thank you to everyone who is accompanying our journey!

All the best and take care,
Exaloan

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