This course will introduce students to the theory and applied concepts of digital lending for all levels, beginners to advanced professionals related to the banking and finance industry. This course will specifically focus on the fundamentals of the different forms of financing in the digital marketplace. We will dive deeper in understanding debt financing in the traditional and digital lending space. We will apply the art and science of understanding credit analysis, due diligence, and underwriting.
The course begins with a recap of the brief history of traditional financing into an introduction of digital lending. We will then explore crowdfunding, the four types of crowdfunding, the issues with crowdfunding and market risk in this industry. From there, you will learn how loans are structured, types of consumer debt and types of business debt. Once you understand these concepts we will delve deeper in understanding debt, both consumer and business debt. We will review the traditional loan process and see how digital lending is taking its own approach in this space. We will explore the difference between Peer to Peer Lending and Marketplace Direct Lending and move right into the bread and butter of understanding debt financing. You will learn how to evaluate debt through a credit model and scorecard. As the digital lending space is a holistic customer experience we will go through a brief introduction of dashboards and financial ratios to promote how to improve the overall customer experience through a digital lending platform. In Module 7, we will dig into understanding how microlending and financial technologies work together and the issues of these two concepts merging together. We will wrap up the course with regulatory compliance.
Overall, this course provides you with the solid, overall, understanding of the transformation of traditional lending to the new forms of alternative lending platforms in banking. Together we will uncover how digital lending is disrupting the finance and banking industry creating new challenges and opportunities for banks and new players.
What am I going to get from this course?
- Understand what lending is in the financial technology space, what it comprises of and theoretical examples underwriting a digital loan
- Leverage traditional lending with new technologies to disrupt the banking sector
- Understand the fundamentals of digital lending
- Equip you with the tools to become knowledgeable in different types of digital lending
- Understand the art of underwriting and credit scoring
- Understand credit risk to reduce credit losses and know your customer
Prerequisites and Target Audience
What will students need to know or do before starting this course?
This course will use general finance and banking terminology. We will also run through exercises in Microsoft Excel. Knowledge and access in these areas is helpful but not required.
Who should take this course? Who should not?
- Anyone interested in understanding the revolution of traditional lending to the online marketplace as it relates to finance and banking
- More specifically:
- Credit Analyst
- Financial Analyst
- Banking Advisors
- Dealers in Commercial Banking
- Client and Banking Relationship Managers
- Finance Managers
- Credit Management
- Banking Finance Managers , and
Module 1: Traditional Financing to Digital Lending
Traditional Financing to Digital Lending
We will introduce and go in depth on the history of traditional financing that has been in place for decades, and introduce the evolution from traditional lending to digital lending.
We will define what crowdfunding is and outline a mapping of how it works within the digital lending industry. We will additionally uncover the 4 forms of crowdfunding and provide a flow chart example of each, and lastly define if there is any market risk involved in crowdfunding.
Module 3: Debt Structuring
We will uncover how loans are structured, types of consumer debt, and types of business debt.
We will go through the traditional loan process as a benchmark as it relates to the digital lending process. We will additionally define Peer to Peer Lending (P2P) and Marketplace Direct Lending, some of the major players, and outline a mapping of how Peer to Peer Lending and Marketplace Direct Lending work within the digital lending industry. We will dive into how to think like an underwriter to evaluate your investment and likelihood of repayment, and explore the different types of consumer debt : use, purpose, and loan structure. We will wrap up the covered lectures up to this point with two scenarios. We will then explore the different types of business debt: use, purpose, and loan structure, and wrap up these lectures with a case study which will review the outcome of an applied scoring model review unique forms of repayment terms for business lending.
Module 5: Loan Monitoring
Digital Lending Platform Experience & Dashboards
Digital Lending Platform Experience & Dashboards, we will cover the lending experience from the Borrowers point of view, and sample dashboards enhance to use the customer service experience.
Module 6: Financial Ratios
We will introduce potential ratios to consider as it relates to investing in peer and/or institutional lending: Amortization Schedules, Internal Rate of Return, Return On Investment, and Profitability Index.
Fintech and Microlending
We will define Microlending (Microfinancing) and how it relates to the Fintech industry. We will examine the issues between Fintech and Microlending., and wrap up the module with a case study and examine a unique real time Peer to Peer Lender.
Module 8: Digital Lending and Regulatory Compliance
We will introduce regulations as it applies to digital lending: Ability to Repay, Regulation B, Regulation P, Regulation V, Regulation X, and Regulation Z.