Upstart, a California-based lending platform, has reduced its workforce by about seven percent, blaming the “challenging economy.”

According to documents submitted to the US Securities and Exchange Commission (SEC) the company informed 140 employees who assist in processing loan applications on Tuesday, November 1 that their positions had been “eliminated.”

Layoffs and a drop in loan volume caused Upstart shares to decline throughout the day, ending 4.4 percent lower at $22.17 per share on the Nasdaq stock market.

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Today’s share price decline has continued, and as of this writing, it is $20.84.

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The company reported a 72 percent annual increase in loan volumes from 456,610 in H1 2021 to 786,675 in the same period a year later in its Q2 results, which were published in August.

On Tuesday, November 8, the company is anticipated to release its Q3 2022 earnings.

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Confirming the number of layoffs, an Upstart spokesperson told FinTech Futures: “Given the challenging economy, we are making this difficult decision for the long-term health of the company. We do not expect any further layoffs and continue to hire for roles that are strategic to our business.”

Upstart joins an ever-increasing list of fintech hit by the current economic volatility and uncertainty.

Source: Fintech Futures

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