The Fintech Fix 09/02/2022

Welcome to The Fintech Fix, where we cover the biggest stories of the financial week! Whether it’s the next groundbreaking trend in cryptocurrency or Blockchain technology, a new partnership about to change the global, economic landscape or an upcoming startup generating a huge following.

Hot Topics – Our first story in this week’s roundup comes from the financial superapp, Revolut, and their journey into the world of Pet Insurance. Revolut will begin offering the service to UK customers, which includes protection from high and unforeseeable vet costs from up to £10,000 per year per pet, 24/7 access to an online vet, medical care when abroad and dental accidental injury cover. The insurance is only applicable for cats and dogs in this initial phase. Chiraayu Sethi, Product Manager for Pet Insurance at Revolut, highlighted how ‘Insurtech is a fast growing sector, and Revolut aims to become one of the world’s leading insuretech players’ after listening to feedback from over 150,000 customers on our platform. With this new venture, Revolut continues to further its dominance. How far will it go?

The metaverse, it seems like a buzzword that just gets thrown around in recent times. How will it actually operate? Well, TerraZero Technologies Inc, a vertically integrated Metaverse technology company, have brought that exciting digital phenomenon to the realms of reality by completing one of the first ever ‘Metaverse Mortgages’ with one of its clients in Ethereum-based Metaverse platform Decentraland. Purchasing virtual real estate may sound bizarre to some, but it very well could be where the meeting places of our future happen. ‘Mortgages and financing availability will expedite the development and adoption of the Metaverse’, commented Dan Reitzik, CEO and Founder of Terra Zero. It does seem to make sense as we’re already spending so much time on Zoom and Google Hangouts as it is! How does it work though? Prospective clients can go online to the TerraZero platform, find a listing they like and book a time with a TerraZero specialist to finalise the brokerage process (including KYC/AML eligibility checks.) Once approved and after signing a mortgage contract, the client can build on their land, organise events, run digital storefronts and host their internal company office soon. Times are certainly changing.

Continuing with a similar theme, NEOM Tech & Digital Company announced XVRS, a 3D cognitive digital twin metaverse platform envisioned to enable a ground-breaking ‘mixed-reality’ urban living model. We truly could be seeing a seamless integration of the virtual and real worlds. Uniquely, XVRS aims to offer users ‘multiple points of view’ and the ability to feature in a variety of locations across the metaverse in real-time (via teleportation) as an avatar, hologram or robotic avatar. Other features include the immersive mixed reality (enabling simultaneous physical-digital presence) and a digital assets marketplace with a built-in crypto and NFT monetization and transaction platform. Joseph Bradley, CEO, NEOM Tech & Digital Company, said ‘the future will be defined not by megacities, but by cognitive meta cities. It is a vision focused on experiences rather than scale. XVRS puts human needs at its core.’ After investing $1 Billion USD into the project, NEOM genuinely has the potential to fuel diversification and unlock significant economic opportunity around the globe.

Coming back towards more familiar ground, Fiserv Inc have acquired the remaining ownership interest of Finxact, developer of the cloud-native banking solution that is powering digital transformation throughout the financial services sector, for $650 million. As financial institutions and companies across all industries around the world embrace new fast-growing digital technology for embedded commerce, finance and payments, Finxact will enable Fiserv to provide clients modern, flexible and highly personalised digital banking experiences.

Big Partnerships To Watch – There has been indelible emphasis placed on improving ESG measures for companies across the entire industry, as we all make a collective effort for a greener future. With that in mind, Algbra and Mastercard have agreed to partner. This will result in support from Mastercard to grow Algbra’s card business, as they currently offer a sustainability card that lets users make direct charitable donations and has carbon and water tracking to review the impact of their purchases so they understand how to offset their carbon footprint with ease. Algbra will also join the Priceless Planet Coalition – Mastercard’s own global move to unite banks, cities and consumers to make environmentally meaningful investments. Kelly Devine, President, UK and Ireland at Mastercard, observed how ‘Algbra are using technology to innovate and deliver enhanced customer experience, but also focusing on people’s own values, and enshrining ethics and sustainability at the heart of their proposition. Together we can make a really positive difference to customers both here in the UK, and all over the world.’

Furthering financial inclusion has become a key objective for many firms in the last few years as we are presented with more opportunities via technology. This has also been the base belief for Rewire, the fintech startup which develops an online financial services platform for expatriate workers. To accelerate their mission, the company has agreed to partner with Qover, a leading insurtech, and AIG, another insurer, to protect its customers in case of accidents at no additional cost. Whilst this may sound like a fairly standard service at first, the package goes further by covering Rewire’s migrant community, ‘an underserved population that faces many bureaucratic challenges on their way to building a better, more financial secure future for themselves and their families,’ according to Rewire Co Founder and CEO, Guy Kashtan. Under the policy, the customer or beneficiary receives a one-time payment of up to €5,000 in the event of dismemberment, paralysis or accidental death.

Our last partnership to discuss in this week’s Fintech Fix is between Colonial First State (CFS) and FNZ, a global wealth platform. CFS has appointed FNZ as the platform provider to replace its current solution under its unique platform-as-a-service model. Using their combined strengths, CFS intends to significantly grow its business in the Australian wrap platform sector.

Funding – Three stories to report in this week’s funding section. Firstly, a report published by KPMG, the Pulse of Fintech H2’21, highlighted the global fintech investment trends so far. What emerged from the data was that fintech funding across M&A, PE and VC reached US$230 billion across a record 5,684 deals in 2021. The largest fintech deals of H2’21 included the US$9.2 billion acquisition of Denmark-based payments processor Nets by Italy-based Nexi, the US$3.75 billion merger of fintech cloud platform company Calypso Technology and regtech AxiomSL to form Adenza in the US, and the US$2.7 billion acquisition of Japan-based Paidy by PayPal. To review some more stats, from payment and insurtech investments to blockchain and crypto, click here!

Molten Ventures led an $8 million seed financing round in IndyKite, an organisation building the identity layer for Web3.0. The funding round will support the launch of IndyKite.id, its digital identity solution to the market, just four months after its commercial debut. IndyKite.id is providing decentralised identity and dynamic and granular authorization services for large enterprises. This enables organisations to map every person, device, and asset across an organisation or network, uncovering rich contextual insights and driving value via hyper-personalization, recommendations, and more.

And lastly, Keo World, the leading BNPL fintech for businesses, landed a 7 year debt facility of up to $500 million from Hayfin Capital Management LLP. Keo will use this facility investment to expand the purchasing power of thousands of small-to-medium-sized businesses (SMBs) via its ‘Workeo’ program. Paolo Fidanza, Founder and CEO of Keo, expressed how ‘in a market where less than 12% of total traditional credit is extend to SMBs, our Workeo product allows business buyers to access key inventory on credit, and suppliers to increase their recurring sales, enhancing working capital management via an all-digital frictionless and low-cost inventory financing platform, thanks to the American Express network.’

Transfer News – The Danish fintech company Inpay appointed Thomas Jul as their new CEO. Having worked in leadership roles across the world, Thomas has a strong record of commercial C-level leadership roles under his belt at both Nets and Ericsson, combined with 15 years of executive leadership at Nokia. A software engineer by education, Thomas also comes with business qualifications from Harvard Business School, The Wharton School, Columbia Business School and more. As the new CEO, Thomas brings a strong team to Inpay to further strengthen the company’s international growth and deliver an even stronger focus on compliance, customer service and product development – with the goal of promoting global financial inclusion. This appointment comes as part of a series of additional hires to the senior leadership team at the company, with Charlotte Bender coming in as the new CFO in March, Jens Heurlin coming in as Group General Counsel and Camila Witt becoming the new Chief Risk and Compliance Officer. Inpay’s former CEO and Founder, Jacob Tackmann Thomsen, commented that ‘Thomas Jul is the right person to take Inpay to the next level in the company’s journey. We are delighted with the new strong management team and I look forward to focusing my efforts on the Board and the work on strategic development now.’

And to conclude this week’s roundup, 10x Banking have appointed three senior sales and marketing leaders as they look to enter a new period of growth in 2022. Lucy Heavens joins as Chief Marketing Officer, bringing a wealth of experience in FinTech and RegTech from previous roles at Wealth Dynamix, CUBE, and SimCorp. Tom Phillips joins as Senior Vice President, Business Development, Europe, offering a broad global perspective to 10x having worked for JPMorgan Chase & Co and Deutsche Bank. Nicholle Lindner joins as Regional Director, APAC. An experienced financial services industry leader and digital banking advisor, Lindner has held senior banking and management consulting positions at Westpac, Commonwealth Bank of Australia, National Australia Bank, Unisys, and Capgemini.