(Reuters) – OnDeck Capital Inc on Tuesday beat Wall Street estimates for fourth-quarter profit, as the online lender disbursed more loans and earned more interest income.
Fintech firms have grown in popularity around the world and even managed to claim some market share from traditional financial institutions on the back of their superior technological prowess, which digitally savvy customers find more convenient to use.
Lenders such as OnDeck and LendingClub have benefited from the fintech boom and the shorter turn around times when compared to institutional banks that take a lot of time to provide loans.
New York-based OnDeck’s loan origination surged 21 percent to a record $658.5 million in the fourth quarter ended Dec. 31.
“OnDeck enters 2019 with considerable momentum fueled by our U.S. lending franchise…” Chief Executive Officer Noah Breslow said.
The company said it expects adjusted net income of $30 million to $40 million in 2019, on gross revenues of $445 million to $465 million.
Net income attributable to common shareholders rose to $14 million, or 18 cents per share, in the quarter, from $5.1 million, or 7 cents per share, a year earlier. reut.rs/2Ia0Euh
Adjusted for one-time items, the company, which lends to small businesses online, earned $15.9 million, or 20 cents per share, beating the average analysts’ estimate of 16 cents, according to IBES data from Refinitiv.
Shares of the company rose 5.8 percent to $7.79 in premarket trading.
Reporting By Aparajita Saxena in Bengaluru; Editing by Arun Koyyur and James Emmanuel