Fund manager Don Davis had been buying online loans for several years when there was a spike in calls from worried clients. In recent months, they’d seen disturbing reports about growing risk in this lightly regulated lending business.
Davis, who works for Prime Meridian Capital Management, has tried to reassure clients with the help of data from a company called MonJa. The San Francisco firm is one of several fintech startups that have emerged in the last couple of years promising to help investors evaluate the quality of the billions of dollars in loans sloshing around the Internet. Though Davis considers some investors’ fears overblown, he says MonJa data saves his firm time and money.
“Investors are more concerned about risk now,” he says. “When they see the headlines, they start to ask more questions.”
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