The Fintech Fix 24/08/2022
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, or a new partnership that’s about to change the global economic landscape, this is the place to keep up with the breaking news of the future.
15 years and 1.2 billion views on YouTube, CSAA Insurance Group goes out of its way to let insureds know they’re ‘Never Gonna Give you Up.’ Last week, the insurer collaborated with none other than Rick Astley in their new brand campaign, paying homage to the original meme sensation while promoting their AAA auto and home insurance. With the advert, a ‘Rickified’ QR code is being distributed across the U.S. which sends viewers straight to the new meme video.
“We are thrilled to partner with Rick Astley to not only revisit the joy of his video but amplify the incredible value that our customers receive with InsurAAAnce,” said Linda Goldstein, executive vice president, Customer Experience & Marketing, CSAA Insurance Group. “And clearly, the indelible lyrics of ‘Never Gonna Give You Up’ are one of the best ways we can share that message.”
The biggest news of the past week comes from Lloyds Bank’s landmark completion of the UK’s first transaction utilising a digital promissory note (DPN) purchase. This new and improved development of promissory notes in large transactions will allow same-day payments to vendors by cutting out the need for physical notes – digitising trade finance. On the 17th of August 2022, the bank completed a pilot transaction – a first under the DNI initiative – that involved the sale and purchase of land worth £48 million between several UK businesses, in one day. Lloyds Bank’s promissory note was issued using Enigio’s solution, trace:original, for digital original documents.
“Lloyds Bank has embarked on an exciting multi-year customer-centric trade digitalisation programme in collaboration with our clients, other banks, government bodies, fintechs, and the wider industry. This successful UK-first transaction is a key milestone along this journey, that we have been able to deliver ahead of the widely anticipated UK Electronic Trade Documents Bill. We are also working on a series of pilots to test the interoperability of digital Bills of Lading across international borders,” said Merisa Lee Gimpel, the Managing Director of Solution Development for Working Capital and Lending Products at Lloyds Bank.
Customer-centricity has been a huge KPI for neobanks too, with UK challenger Revolut launching Revolut <18. The new bank account for young people aged 6-17 will be directly linked and controlled through their parents/guardians’ existing Revolut account. Hoping on the trend of financial literacy and gamification, the in-app account – previously labelled Revolut junior – will allow under-18s to track their spending with routine alerts and set realistic savings targets – building healthy money habits and knowledge. Guardians will also be notified each time the card is used and can navigate their children’s financial journey by setting ‘pay days’ and earning challenges. Currently, the service boasts a customer base of 1.6 million worldwide.
In another home run for the banking sector, Temenos has announced that The Bank of Queensland (BOQ) has officially gone live with retail banking services on Temenos Banking Cloud, migrating their current ME brand to the platform. With this venture, BOQ can now offer customers a range of personalised retail and business offerings for a much lower cost – as the migration will consolidate 40 legacy systems to a single platform. BOQ plans to move their operations across three banking brands; regional bank BOQ, and challenger banks Virgin Money and ME Bank. The bank has completed over four million transactions since going live on the platform.
Mergers and Acquisitions
Goals of digital expansion have dominated recent M&A activity. This week Truist Financial Corporation has acquired Zaloni’s Arena platform to further develop their data governance, AI and ML programmes. A new team of Zaloni engineers, led by founder and Chief Technology Officer Ashwin Nayak, will join Truist’s Enterprise Data Office, which in turn will be led by Chief Data Officer Tracy Daniels.
“Truist is making investments to continuously grow and evolve with our clients’ banking needs. In partnership with Truist Ventures, we identified the Arena platform as an investment that will help us deliver better financial experiences, advance our strategy and demonstrate our purpose to inspire and build better lives and communities,” said Scott Case, chief information officer at Truist.
Looking toward the global south, Tribe Fintech has partnered with one of the fastest growing banks in Africa, TymeBank, to launch their new business community platform TymeTrybe. Launched in South Africa earlier this month, the service will allow SME owners and TymeBank Business Banking customers to connect in one financial community ecosystem. This platform aims to equip business owners with the tools they need to thrive in a digital economy. TymeTrybe will help SA SMEs scale online using Meta’s social media platforms with Meta Business Pathways, and provide educational avenues for crash courses in business.
“It’s exciting to know that a visionary banking group like Tyme, along with our partners such as Meta, Wits and SMEasy, share our vision to take a more holistic look at the amazing people at the heart of our business communities,” said Mo Harvey, CEO and Founder of Tribe. “This is a momentous step in our journey to create community-oriented B2B banking for every size and type of SME around the world, and a model we aim to replicate across Africa and South East Asia.”
Big four accounting firm EY also formed a partnership with IT infrastructure provider, Kyndryl, and Ernst & Young LLP (EY US), in further efforts to help clients accelerate their digital transformation goals. The EY−Kyndryl Alliance will combine Kyndryl’s cloud and core infrastructure services with EY’s consulting capabilities to provide expertise on cybersecurity, asset management and cloud infrastructure services. The move into fully digital and automated services is unavoidable in the finance sector, to the point where almost all companies in the FS can boast the title of fintech or claim to rely heavily on it.
Funding and Expansion
Payroll and billpay-oriented fintech, Highline Technologies, has secured $13 million in its Series A funding round, led by Jump Capital, Costanoa Ventures, and Foundation Capital. After a successful seed round in 2021, this funding will be used to bolster operations in-house, from additions to staff, to focusing on market adoption of its products and services.
“When speaking to lenders, we heard a consistent refrain – they were all aware that connecting to borrowers’ payroll would drastically reduce defaults and materially improve their competitive positions,” shared Yelena Shkolnik, Partner at Jump Capital. “Most had tried and failed to leverage deductions, challenged to compliantly manage the funds flow, or offer adequate employer coverage. In Highline, lenders have the solution they’ve searched for and a powerful end customer experience to transform their lending.”
Still in the payments field, insurtech Vitesse PSP is also evolving its team with the onboarding of three new team members. Corporate tech and financial professionals Richard King, Ashley Abdelmoula and Bill Wilkins have all been welcomed into the London headquarters, filling the seats of COO, Head of Insurance Proposition, and CPO/CTO respectively. The new hires will bring their extensive skill set to further accelerate Vitesse’s expansion goals in the next 12 months.
“With the addition of these three talented individuals, I have no doubt that the next few years are going to be extremely successful for Vitesse,” said Phillip McGriskin, the CEO of Vitesse PSP.
Finally, in Latin America, Citi Venture’s announced its investment in leading Open Finance API Platform, Belvo. This joint venture follows Citi’s goals to usher in an Open Finance ecosystem in Mexico, with Belvo leading in developing new products and services that leverage Open Finance capabilities. Fintech already provides API connectivity to over 150 clients across the continent, this backing from a big FI like Citi will allow Belvo to connect to more clients and end-users with their platform and make Open Finance more accessible in the region.
“Open Banking represents an enormous opportunity in Latin America as a key enabler of the explosively growing fintech ecosystem in the region, and we are excited to invest in Belvo, which we view as the leading provider in this exciting space,” said Luis Valdich, Managing Director of Venture Investing, Citi Ventures.
And 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 at FF News
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- Ashley Abdelmoula
- Ashwin Nayak
- Bill Wilkins
- Costanoa Ventures
- CSAA Insurance Group
- Foundation Capital
- Highline Technologies
- Jump Capital
- Linda Goldstein
- lloyds bank
- Luis Valdich
- Merisa Lee Gimpel
- Mo Harvey
- Phillip McGriskin
- Richard King
- Rick Astley
- Scott Case
- The Bank of Queensland (BOQ)
- Tracy Daniels
- Tribe Fintech
- Vitesse PSP
- Yelena Shkolnik