Alt Lending Is Touted As The Next Big Thing By Millennials.
Millennials, the “Gen-Y,” falling in the age bracket between 18-34 years, are now being touted in the U.S as the “newest, biggest and most diverse target market,” making up nearly 60% of the workforce and accounting for about 21% of its disposable expenditure.
However, with all their love for speed and digitization, one is unlikely to find them waiting for months for a loan application to be processed through conventional routes. Moreover, Millennials with their average credit score of 647 as compared to the national average of 682 (on account of factors as varied as piled up students debt or start-up debt) fall far behind in this conventional credit ranking criteria and hence, fall within the bracket of the “creditthin” or “credit invisible” category.
They today stand at the precipice of credit age and they form the major chunk of the entrepreneurial class who are poised to shape the economy in the years to come. However, an Experian study has decreed that there is 71% more chance of Millennials seeking financial advice from their dentists than heading towards the banks. Hence, it is not surprising then that this particular segment of the population finds in Alt lending its primary cheerleader.
How Alt-finance is fast usurping the No. 1 favorite spot for Millennials? The last few quarters of 2019 and the early quarter of 2020 have been proof of the fact that we at Alt lending is making fast and definite inroads into the SME category of financing.
• Fast processing of Cash Advances and ease of transactions and absence of collateral requirements have led us today to surge ahead, surpassing the conventional route of banks and private financiers in the financing category of the SME sector. • From the millennial viewpoint, what better way to access Cash Advances than with the press of a button? The entire digitization experience that our new Alt Finance models like Mantis Funding Cash Advance are bringing to the table has re-written the dynamics of the industry rules.
• Cash Advances are being underwritten in record time, sometimes in as less as 24 hours at customer care centers like Mantis Funding Comp, and funding is sanctioned twice as fast than most other channels. • The key nudge being provided by our Alt lending model is in the direction of using digital records to assess the creditworthiness and track records of the clients instead of an assessment of balance sheets and FICO scores of
• With the lightning-fast credit appraisal system and Cash advance disbursement facilities, they are today the biggest source of easy credit to small businesses and will remain extremely important in the next decade or so. The Alt Finance lenders, comprising mostly of start-ups like ours at Mantis Funding Cash Advance, disbursed some 48% cash advances to Millennials below 30 years of age as compared to 25% sanctioned to the plus 35 age
The Future of Alt-finance Millennial population, slated to cross rough 83 million, half of which shall take the entrepreneurial route, understand the pulse of the growing market economy. They know that the focus and style of advertising and marketing materials have revolutionized in the last quarter of a century, and their work ethics are fast reflecting this shifting dynamic. 81% of this burgeoning population cited the ease and speed of faster loan application reasons for having made the switch, while 77% voted in favor of our new age model for the rapid pace of credit decision and better customer
They are fast shifting gears from traditional lending agencies to the new age Alt finance companies and knocking the doors of companies like Mantis Funding Compliance. This significant development in the coming years augurs well for the future of Alt finance in the United States.