HSBC Back on the US Consumer Lending Market

HSBC’s American arm resumes their consumer lending activities in the US and teams up with the FinTech Avant. Their customers will be able to rely on a digital platform –to launch early next year– to apply for a loan in a matter of minutes.

HSBC is planning to roll out a digital consumer lending platform for new and existing American customers next year. This service will be using Avant’s Amount platform. The e-lending specialist claims roughly $5 billion in loans and more than 600,000 customers.

Banking customers will be able to apply for a personal loan in a matter of minutes and have the granted amount credited to their bank account in a day. They may borrow up to $30,000 (roughly €26,300) with terms up to five years and APR ranging from 5.99 to 20%.

HSBC put an end to their credit business in the US roughly ten years ago. They have been planning this launch for two years so they can resume proposing ranges of products highly demanded on this market.

Comments – HSBC’s digital approach to modernising their image

In the US, HSBC mostly relies on a network of branches (roughly 230 locations). From now on, they will be relying on a digital platform to reach out for the consistently expanding lending market. Outstanding balances in the US jumped to $125 billion in Q2 2018, nearly +20% more than to the previous year.

The bank teams up with a FinTech and will be relying on an existing infrastructure, even if they would be able to roll out and manage these type of products on their own. They save themselves the trouble of building an efficient technical infrastructure already available from this partner. Based on features provided by Avant, including instant services, HSBC may ensure much a more fulfilling user experience.

This partnership echoes a trend which sees banks and FinTechs working together for the sake of improving customer experience (paperless procedures and instant decisioning): examples include InnoCells from Banco Sabadell and Instant Credit, BNI Europa and Parcela Jà, ING Poland and inviPay, etc.