Greensky is a fintech that connects borrowers with banks for instant loan processing. It is seen as an offline version of Lending Tree. It does not send any money to borrowers but offers the technology needed to connect borrowers to the lenders. It makes its profits through the fees it charges to facilitate the transaction between these two parties. It is one of the best performing fintechs at the moment. In 2017, it managed to facilitate over $230 million in loans which was a huge improvement from what had been recorded the previous year.
GreenSky offers win-win-win
Investors in this fintech have high hopes that it will turn out to be one of the most successful investments in the future. One of the early investors in this company is the co-founder of Capital One Nigel Morris. He is the first institutional investor to buy shares in this company. One might want to know what win-win-win standards for. Nigel Morris came up with this description referring to the fact that merchants, consumers, and banks benefit from the operations of the fintech.
Nigel Morris is a reputable investor who managed to build Capital One from a tiny startup to the largest credit card issuer in the world. So, when he talks about the prospects of GreenSky being the next big thing, he is doing it from the point of information.
Why is it a win-win-win?
Nigel Morris calls this a win-win-win business for obvious reasons. Merchants or contractors get a chance to convert customers who were stranded without cash to pay for services and even upsell other services since the loan processed can be higher than the actual amount applied for. Consumers, on the other hand, enjoy the freedom of paying for certain services with flexibility. The loan repayment is paid over time and therefore does not bother the consumer too much. To make it better, consumers pay for the loan without incurring any interest. For the banks, they benefit from high loan volumes with minimal effort.
In the whole process of win-win-win, GreenSky also benefits. Each of the transaction it facilitates is charged. They also get a consistent stream of income for the period of servicing the loan. The transaction fee usually is about 7.4 percent of the transacted amount.