Marketplace Lending and FinTech

Marketplace Lending and FinTech

Hunton & Williams LLP’s marketplace lending and financial technology (FinTech) team knows the complexities facing marketplace lenders and other marketplace lending participants. Whether you are:

  • a start-up or an established marketplace lender,
  • a bank originator,
  • a securitization sponsor,
  • a loan servicer,
  • an investor or a potential investor in a marketplace lender, or in underlying loans originated by marketplace lenders,
  • a vendor to a marketplace lender or to funds that invest in marketplace lenders, or
  • a bank or other financial institution entering into a financing or purchase transaction with a marketplace lender,  

our team has the business and regulatory knowledge and experience to assist you.

Our clients include: marketplace lenders, bank originators, debt and equity investors in marketplace lenders, institutional investors, private equity firms, hedge funds and other purchasers of marketplace loans, as well as software companies; and, other vendors to marketplace lenders, banks and other financial institutions in connection with lending, financing and purchasing activities with respect to marketplace loans.

Our team’s experience in the marketplace lending industry allows us to provide effective and decisive guidance, while delivering practical legal advice that is tailored exclusively to individual client goals.

Our marketplace lending team has relevant experience in:

  • developing compliance management systems and procedures for marketplace lending programs,
  • addressing interest rates and fees charged by marketplace lenders and bank originators,
  • working with marketplace lenders to obtain necessary state and federal licenses,
  • designing state and federal regulatory compliance systems,
  • negotiating software licenses and cloud platform agreements,
  • eContracting and IT sourcing,
  • structuring loan sale programs that address certain U.S. federal tax issues relevant to foreign investors,
  • securitizing marketplace loans,
  • evaluating compliance with, and designing marketplace lending procedures that comply with, domestic and
    foreign privacy laws,
  • developing corporate policies and procedures,
  • designing executive compensation arrangements and benefits programs,
  • evaluating and negotiating investment offers, and
  • forming/structuring hedge funds that invest in marketplace lenders, or in underlying loans originated by marketplace lenders.

Marketplace lenders today are being closely monitored by federal and state regulators, and state attorneys general have begun investigating and prosecuting actions against market participants for their consumer lending practices. Meanwhile, consumer groups have become increasingly wary, advocating strongly against marketplace lending companies and their practices, and the Consumer Financial Protection Bureau, focused on furthering the interests of consumer borrowers, is creating a challenging regulatory environment for the industry. The US Treasury has also expressed interest in better understanding marketplace lending. Bank Prudential Regulators are mandating enhanced compliance management systems with coverage including third-party risk, BSA/AML/KYC systems and IT/cybersecurity practices.

Marketplace lenders face a wide array of licensing statutes and requirements at both the federal and state levels. The attorneys in our marketplace lending team have for decades represented clients in business-to-business and consumer litigation, and in regulatory investigations. Our attorneys also have extensive experience in advising our marketplace lending clients on state lender licensing matters, federal and state securities and banking law licensing and regulatory matters, including broker-dealer matters, investment adviser compliance and investment company matters.

Our marketplace lending and FinTech team draws upon the skills of seasoned legal professionals who are part of a global law firm with more than 750 lawyers worldwide. Hunton & Williams’ lawyers have proven time and again an ability to cultivate strategic relationships with their business clients, bringing to bear, among other things, a broad range of experience and knowledge in structuring creative fee arrangements while meeting our clients’ unique goals and cutting-edge business objectives.