The Fintech Fix – Weekly Roundup 24/11/2021
Welcome to the sixth week of 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 CEO creating an economic revolution or an upcoming startup generating a huge following, this is the place to keep up with the breaking news of the future.
Hot Topics – This week’s hot topics are exciting, with news on how some banks are struggling to survive in the US, new BNPL service providers, the future of financial collaboration and much more! But if you did miss last week’s huge news, be sure to check it out!
After 162 nominations, 30 days of voting and over a thousand hours of footage watched, we are delighted to announce the finalists for the FF Awards 2021. With 15 categories to compete in, including WOW moments in Consumer Banking, Blockchain Technology and Embedded Finance, we look forward to seeing which companies triumph in our unique awards ceremony. Will it be iwoca for Lending, will it be Temenos in Business Banking or Clim8 for Authentic ESG? Tune in and find out!
America has always been renowned as a competitive landscape to succeed in and it maintains this reputation after N26, one of the largest digital banks in Europe and Germany’s most valuable fintech company, announced its withdrawal from operating in the US less than two and a half years after its launch there. CEO and Founder of N26, Maximilian Tayenthal, announced this move as part of company strategy to double down on their strongest markets in Europe. This withdrawal follows that of Monzo, who also announced their withdrawal for a US banking license last year. Whilst American companies like JP Morgan can successfully launch UK versions of digital banks, shown in JP Morgan Chase UK earlier this year, it begs the question, why are European banks struggling to be successful in the US?
Collaboration is no doubt essential as banks look to evolve in our future. Lloyd Bank’s Head of Product – Payments, Gavin Maclean, expanded on this notion, talking about how Lloyds are using collaboration to spearhead innovation at a pace that benefits themselves and, crucially so, customer experience too. This involved extending the benefits of digitising contactless payment journeys and capabilities.
Yapily, the Open Banking infrastructure provider in Europe, recently announced their new launch in Spain. Already covering 95% of Spanish bank accounts, both private and corporate, the project intends on driving innovation, growth and international expansion for domestic banks and the country’s thriving fintech sector. Angel Salamanca, Yapily’s Country Lead for Spain, said that ‘Our infrastructure is API-first, secure, reliable and delivers a great developer experience. Yapily is content to remain in the background – invisible to end users and putting our customers in control and at the forefront in creating better user journeys and experiences.’
TerraPay, a leading global payments infrastructure company, bolstered its operation in the LATAM region after successfully launching in the USA and Canada earlier this year. It furthered this successful expansion though by launching its services in Mexico and 15 more Latin American markets. This is a great move, especially since the LATAM market is one of the fastest growing mobile markets in the world; In 2018, there were 326 million mobile internet users in the region, and that figure is anticipated to burgeon to over 422 million by 2025.
In the FF News Virtual Arena, UBS’ Elmar Handke, Volante Technologies’ Chris Stares and Nihit Ahuja in a discussion focused on using a ‘Low Code / No code’ approach for adoption of ISO 20022 in the payments and cash management space. With the deadlines hurtling towards the industry it is becoming a do or die time for financial institutions around the world.
UK Finance, the collective voice of the banking and finance industry, has highlighted its recommendations for the future strategy of Open Banking payments in its latest report. This comes on the back of the prolific rise of Open Banking payments, which now record 2.5 million payments a month compared to just 320,000 in the whole of 2018. The 3 key recommendations include further governance from the CMA and Open Banking Implementation Entity, a multilateral industry framework and the development of variable recurring payments to give customers more choice and control over their payment options. Jana Mackintosh, Managing Director of Payments and Innovation at UK Finance, said ‘Open banking has an exciting future, and the payments industry is working together to consider how the market could be enhanced for customers and merchants.’
Karl Gilbert, CEO and Co Founder of Raylo Pay said that ‘Off the back of strong growth via Raylo.com and demand from merchants, we have decided to accelerate our mission to change the consumer tech market’ This comment comes after Raylo Pay’s launch to third party retailers as part of the brand’s mission of changing the way consumers get their tech for good, and to challenge the tech industry’s ‘take-make-use-dispose’ model further
Lastly, the Singapore Fintech Festival, hosted earlier this month, continues to gain attention through our very own segment, ‘60 Seconds at Singapore Fintech Festival’ Through an array of brilliant quickfire interviews, we were able to find out that to Oliver Siah, Co Founder of Fraxtor, views the state of Fintech in Singapore right now as ‘progressing’, whilst Vinay Samuel, Founder and CEO of Zetaris, thinks the best Singaporean food is chilli crab!
Transfer News – It’s only one story to announce here in our transfer column, as UK-based fintech Monevo has appointed Kelli Fielding, TransUnion’s Managing Director of Consumer Interactive in the UK, to its board, helping to leverage TransUnion’s global relationships and market-leading decisioning and analytic capabilities. On this, Greg Cox, Monevo’s CEO praised how how ‘Kelli’s insight and perspective on market trends will play a key role in shaping Monevo’s strategy going forward and ultimately help Monevo and TransUnion achieve our mutual long-term goal of improving consumers’ access to credit on the best possible terms.’
Funding – 3 key funding stories to report this week on the fix. Firstly, Bound secured $6.5 million in seed capital from some of the founders and VCs behind Klarna, Stash, MX and Qonto to help it transform the UK’s SME forex market. The platform currently prides itself on making currency hedging simple for SMEs.
Pace, a Singapore-based fintech solution company that allows customers to BNPL, raised USD $40 million in its Series A investment round. Turochas ‘T’ Fuad, Founder and CEO of Pace, analysed that ‘the region is expected to become the world’s fastest-growing BNPL market, and this funding supports Pace in achieving its mission of democratizing financial services for all, by helping us pave our expansion into Japan, Korea, and Taiwan.’
Thirdly, Leo Capital, a venture capital fund investing in early stage, technology centric opportunities primarily in India, is attracting global investors for the nation. Indian startups received $26.7 billion in the first three quarters of this year alone, putting the nation on track for well more than $35 billion in investment by the end of 2021. Leo Capital is now targeting a new $125 million fund to capitalise on these new opportunities.
Big Partnerships To Watch – The first big partnership in this week’s roundup involves AstroPay, who have agreed to partner with leading international e-commerce platforms including WooCommerce, VTEX and PrestaShop to expand its e-commerce reach and access a wider consumer base in new markets. AstroPay is a global leader in online payment solutions, but this partnership will further solidify their market presence by offering traders the option to effortlessly download AstroPay’s online payment plugin and make payments more conveniently.
Codat, the API enabling SMEs to synchronise and share financial data, has partnered with Judo Bank as part of its expansion into Australia. In this partnership, Judo SME customers can digitally share their financial statements with Judo in just a few clicks, thanks to Codat’s universal API provides standardised access to over 30 systems used by small businesses, including banking, commerce platforms and the accounting software used by 97 per cent of Australian SMBs.
NPCI International Payments Ltd (NIPL), the international arm of National Payments Corporation of India, and PPRO, leading global provider of local payments infrastructure, signed an MOU to partner together in order to empower India’s digital payments ecosystem across the globe. Stefan Merz, Chief Strategy & Growth Officer at PPRO explains “Expansion into India’s e-commerce market presents a huge growth opportunity for PPRO. The country’s e-commerce landscape is worth 52.6 billion USD, predicted to increase to 120 billion USD in 2025, and is made up of an online population of over 700+ million people, making it one of the largest in the world. Ritesh Sukhla, CEO of NIPL, echoed this sentiment, claiming that ‘We are confident that our proven product capabilities, combined with the vast merchant network of PPRO, will enable acceptance and scale-up in online markets.’
And to conclude with our last story of the roundup, it’s some cryptocurrency news. Bitstamp, the world’s longest-running cryptocurrency exchange, will partner with the main liquidity provider for LHV Bank, and begin offering cryptocurrency trading to its customers. Julian Sawyer, CEO of Bitstamp, and Madis Toomsalu, CEO of LHV Group, both highlighted how this is just one of many signs that crypto is continuing to gain notable buy-in from traditional banking and financial services and, in the future, can truly establish itself as a new ‘normal.’
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.