Germany based Fintech creditshelf Aktiengesellschaft, an SME financing platform, is launching a new partnership with CrossLend to offer the first digital securitization of SME loans in Germany.
According to creditshelf, CrossLend is an investor on the creditshelf platform and purchases loan receivables as part of the regular lending processes. CrossLend will then securitize the loan receivables and offer them in the form of a new product to a broad base of additional investors via its own channels.
The company states that initially, an institutional investor will invest a “mid-single-digit million euro amount” each month in creditshelf’s new business via CrossLend.
The securitized loans will create a new funding channel for the platform.
“With the flexible securitization of SME loans, we are offering a new, innovative product,” states Dr. Daniel Bartsch, COO and founding partner of creditshelf. “The fully automated process increases the transparency of the resulting securities, creates flexibility and makes it possible to keep transaction costs low. This model opens up new groups of investors for us and thus also benefits our customers”.
CrossLend’s digital securitisation platform is said to convert the loans into bonds in a flexible and transparent manner.
Oliver Schimek, CEO of CrossLend, explains that their platform was designed to make the credit market more efficient and digital.
“The cooperation with creditshelf for the real-time securitization of SME loans takes us a long way forward in this direction”, says Schimek.
The report states that other institutional investors are in the queue to back the SME loans originated on the CrossLend platform.