The Fintech Fix 19/01/2022

Welcome to The Fintech Fix, where we cover the biggest stories of the financial week! Whether it’s the next groundbreaking advancement in Blockchain technology, a new partnership about to trigger an economic revolution or an upcoming startup generating a huge following, this is the place to keep up with the breaking news.

Hot Topics – One of the biggest financial organisations and global super-apps in the world, Revolut, announced their mission to further their dominance as they launched as a bank in 10 Western European markets. Now, customers in Belgium, Denmark, Finland, Germany, Iceland, Lichtenstein, Luxembourg, Netherlands, Spain and Sweden who upgrade to Revolut Bank, a mere few minute proces, will have deposits of up to EUR 100,000 protected under the deposit guarantee scheme. Joe Heneghan, Chief Executive Officer – Europe of Revolut Bank, commented that this venture will ‘provide an even greater level of security and confidence for our customers.’ This is certainly the case, as a survey carried out by Revolut highlighted that 54% of customers would spend more via their app if they had their deposits insured. Revolut are becoming even more of a force, day by day.

Continuing to make headlines, Visa unveiled their new platform – Visa Acceptance Cloud (VAC.) Cloud technology was one of the key trends of 2021 in finance and is no doubt the future of payments. The VAC is set to transform the way businesses accept payments from their customers, allowing acquirers, payment service providers, point of sale (POS) manufacturers, and Internet of Things (IoT) players move payment processing software from being embedded in each hardware device to being universally accessible in the cloud. Mary Kay Bowman, Senior Vice President and Global Head of Payment and Platform Products at Visa, expressed that this would ‘drive inclusion for more small sellers’ and ‘open up the possibility of so much innovation from the entire payments ecosystem.’

BNPL was one of the biggest themes for financial organizations in 2021. Have things changed? Of course not! With that, Railsbank launched a new white label BNPL credit solution that enables retailers to offer their own branded, fully-integrated BNPL payment experiences. This is huge. The customisation element of the solution will greatly assist retailers by ‘removing distractions and allowing retailers to maximise engagement with their customers’, said Louisa Murray, COO of Railsbank, UK and Europe. It’s a truly unique offering and reflects the growing usefulness and applicability of embedded finance in action. Banks aren’t essential, but banking is, and non financial organisations can begin to experiment with this vision of a new, embedded future.

The Bank of America recently launched a new tool which uses AI and ML to forecast future cash positions across clients’ accounts at their, and other, financial institutions. ‘CashPro Forecasting’ aims to solve a key pain point for companies; how to measure future cash needs without a significant manual effort or a costly technology investment. The key features of the tool includes improved accuracy, scenario analysis, multibank reporting, transaction mapping, simple setups and complete customizability. Why is this different? ‘Unlike competitor solutions, CashPro Forecasting requires no onboarding since it’s fully integrated into the platform, allowing it to automatically plug into the client’s historical cash flow information,’ said Jay Davenport, Head of Product Structuring Sales in Global Transaction Services at Bank of America.

Bubble, a firm making tailored home and life insurance available online in an instant, launched its turnkey Embedded Insurance-in-a-Box offering. What does this actually mean? With Bubble, real estate and mortgage companies are able to embed digital homeowner’s and life insurance seamlessly into real estate transactions. This enables people buying a home or refinancing a mortgage to easily – often in just a few minutes online – protect their homes as well as their families’ futures at the same time as making a home/loan purchase. Bubble Co-founder & CEO Avi Gupta. “Millennials especially stand to reap the benefits of bundling life and home insurance while they’re young and healthy. They can lock in a great rate for the next several decades. It is clear that Bubble are acting with true meaning that can genuinely enrich a key moment in many people’s lives.

What is the state of UK Pet Insurance like at the moment? Our newsroom team took a deep dive into this niche, especially relevant since 3.2 million households acquired a pet during lockdown, with the industry expected to reach a valuation of up to $2.09 billion by 2026. I’m not one for exoctic pets, but there are an estimated 1.8 million reptiles, amphibians and invertebrates in the UK as pets. Most UK insurers do not cover exotic pets for the potential risk. What does this gap in the market mean?

Lastly, Tandem Bank announced its acquisition of Oplo to create a fairer, greener digital bank for UK consumers. With a combined total of £1.2 billion in assets and 171,000 customers, Tandem Bank looks to leverage existing savings, mortgage and climate-friendly home improvement lending products to offer customers greener financial choices. Susie Aliker, Chief Executive of Tandem Bank, commented that ‘With our flexible digital platform, new enlarged scale and strong profitability, Tandem is fantastically well positioned to become one of the UK’s leading digital banks.’

Big Partnerships To Watch – We have two big partnerships to keep on your radar in this week’s roundup. First, BNPL continues to create headlines, as the fintech Zilch has expanded its existing 2019 partnership with Mastercard to bring their popular BNPL digital card offering to Europe. Zilch, a London based unicorn, is no doubt one of the forefront runners in the progressive march of BNPL – they reached over 1.7 million customers in less than 15 months, a record time within the BNPL industry. Enabling Mastercard payments allows Zilch to empower even more customers, ‘ensuring that their experience is best in class’, according to Philip Belamant, Zilch Founder and CEO.

Our second partnership to watch out for involves The European Commission, who selected Billon as one of five providers of Phase 2 of the EU Blockchain Pre-Commercial Procurement Process. Billon will pilot innovations to improve the scalability, energy efficiency, security and privacy of EBSI (the European Blockchain Services Infrastructure) for two use cases; intellectual property management and product life cycle management. Billon Group Founder and Chief Technology Officer Andrzej Horoszczak comments ‘this opportunity aligns with the vision we had from Billon’s founding, to focus the power of blockchain on solutions that transform existing ways that institutions, companies, and individuals do business. We see this as a game-changing contract, allowing us to demonstrate technology that complies with EU regulations, and makes scalable blockchain-based public services a reality.’

Funding – WealthKernel announced a Series A+ funding round where the firm secured a further investment of US$7M. A leading provider of digital investment services and infrastructure in the UK, the funds will be used to expand services into European markets too. WealthKernel’s ambition is to eventually become the best API wealth infrastructure provider in the UK and Europe. How? ‘Democratizing access to wealth and investment services is a purpose we understand and respect. Beyond good commercial sense, it is a game changer for the many investors denied access to such services till now. Seizing this trend, in the past year alone WealthKernel has enabled a number of diverse businesses – such as Claro Money, Wahed, and Wealth8 – to enter underserved areas of the wealth services market, covering areas from halal and ethical investment to ESG. The future is bright!

It’s all gravy for Gr4vy, the leading company for cloud-native payments orchestration, who secured $15M in a Series A funding extension, leading their total funding at a figure of $27.2M since the company’s launch last April. John Lunn, Founder and CEO of Gr4vy, said this: ‘Payment orchestration shouldn’t be overly complicated. Our cloud-native POP delivers modern payment infrastructure and allows merchants to expand and manage payment methods, services and transactions in a no-code/low code fashion with just a few clicks.’ It is clear then that in offering merchants with individualized infrastructure in the cloud and the highest level of flexibility to manage payment stacks, Gr4vy is redefining the payment industry. And it’s not a surprise, especially when the company continues to draw in industry leaders to its team, including fromer Google alumnus, Zubin Vandervala, along with other key hires from companies such as Ayden, Braintree, Paypal, and many more. What a hub for talent!

Transfer News – Only one big story to report in our transfer column this week, and it comes from the hedging platform set to be a gamechanger for SMEs, Bound. Bound have set the bar high for themselves and are clearly booking to continue their strides into success through a series of appointments.

The appointments include:

• Nikolay Vassilev from Uber, who joins as Engineering Manager.
• Robert Nunn as Senior Engineer, who previously worked for the digital bank Tide.
• Maria Shramko as Senior Technical Recruiter from People.ai, a predictive sales management platform that achieved a $1.1billion valuation in 2021.
• Jamie Sullivan, formerly of Monex Europe, who joins Bound’s business development team alongside recruits from some of London’s leading foreign exchange companies and the banking and payments app Revolut.

The rapid expansion reflects industry confidence in the Bound platform, which is being tipped by VCs to be one of Europe’s next major fintechs.

So that’s your weekly Fintech Fix! Stay tuned for next week’s dose so that you can stay up to date with the biggest stories of the future, right here in the present.