MX Integrates with Dwolla; Bambu and Moven Launch Strategic Partnership

MX Integrates with Dwolla; Bambu and Moven Launch Strategic Partnership

From the partnership between Best of Show winners MX and Dwolla that will enhance and automate account verification to the news of a strategic partnership between roboadvisor Bambu and Moven, collaborations between Finovate alums are filling the fintech headlines to start the week.

With MX and Dwolla, the partnership extends instant account verification coverage to 4,000+ institutions, making it easier for MX customers to connect securely to any deposit account. The integration also enables account verification through micro-deposits, which makes it possible for MX to offer verification for “nearly 100 percent” of deposit accounts in the U.S.

Enabling better access to micro-deposits by improving the verification experience is a key component of the integration. MX co-founder and CTO Brandon Dewitt underscored the importance of these deposits and the role they play in financial inclusion and serving the underbanked. “Micro-deposits have gotten a bad reputation in the industry, but the truth is for some of the population who bank with community credit unions or mid-sized institutions, it comes down to either using a micro-deposit or not having the ability to connect them to their accounts,” Dewitt said.

MX most recently demonstrated its technology on the Finovate stage two years ago at FinovateFall. The Lehi, Utah-based company won Best of Show for a live demo of its MX Enabled platform that helps financial institutions add to their offerings via connections with fintechs through MX’s API ecosystem. Earlier this month, MX launched a new suite of financial insights APIs and embeddable user interfaces to enable companies to pursue opportunities in open finance.

Dwolla won Best of Show in its Finovate debut in 2011 at FinovateSpring. The company announced just last week that it had raised $21 million in funding in a round led by Foundry Group that will help it continue to innovate in the B2B payments space.

“Partnering with MX will automate the verification experience and make it that much easier to verify a bank account,” Dwolla President and COO Dave Glaser said. “Together with Dwolla, MX has configured a new solution to ensure that millions of payments occur smoothly and easily each day. We couldn’t be more excited about this partnership and the impact it will have on millions of Americans.”

Giving average retail banking customers the kind of support typically available only to high net worth individuals is part of the motive behind the strategic partnership announced early this week between roboadvisor technology solution company Bambu and financial wellness technology platform Moven.

“Adding Bambu’s capabilities to Moven’s mobile-centric experience is well in-line with the needs of banks and fintechs to provide consumers with personalized, automatic investing to their product offerings,” Moven Chief Revenue Officer Bryan Clagett said. He noted that traditional banks still have a major impact and influence on their customers and, as such, they can and should do more – beyond banking – to enable their customers to better manage the entirety of their financial lives.

The new offering is designed to empower bank customers by allowing them to manage and plan their finances and investments more holistically. The goal is to provide customers with the equivalent of a digital CFO to help them better understand their spending patterns in order to increase savings and better manage their investments. This is a critical aspect of the new solution, which moves beyond simple robo-investing to give customers a more comprehensive view – and greater control – over their finances.

“We look forward to working closely with Moven as wealth and digital banking become more seamlessly connected,” Bambu co-founder and CEO Ned Phillips said. “Moven’s long history in digital banking and Bambu’s intelligent wealth APIs will provide a perfect platform for any financial institution focused on digital banking and wealth.”

Singapore-based Bambu made its most recent Finovate appearance last year at FinovateEurope in Berlin where the company demonstrated its BambuGo white label financial roboadvisor platform. Earlier this month, Bambu announced that it had acquired investment management technology company Tradesocio.

Making its Finovate debut more than eight years ago, Moven famously pivoted from a direct-to-consumer/neobank model to a focus on “smart banking and financial wellness” a little over a year ago. The company has teamed up since with fellow Finovate alums Q2 and Digital Onboarding, as well as with intelligent billpay company Blip Labs and digital asset manager NYDIG, to help them better engage their customers with actionable insights to enhance financial health.

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CreditRich Founder Angel Rich to Take Financial Literacy to the Next Level

CreditRich Founder Angel Rich to Take Financial Literacy to the Next Level

Not all partnerships in fintech involve companies. In fact, one of the most interesting partnerships in fintech in recent days might be a union between people – not an alliance among corporations.

Angel Rich, who made history this spring as the first African-American woman to secure an institutional partnership with one of the Big Three major credit bureaus, announced her engagement to Karl Jones, Director of Corporate Partnerships at ansrsource, this week. “What’s better than one future Black billionaire?” Rich asked on her LinkedIn page by way of sharing the engagement news. “Two. Thanks for all of your love and support on our engagement. Karl Jones and I are very excited to make an impact with our union.”

Rich’s company, WealthyLife, launched its AI-powered fintech app, CreditRich in April, collaborating with Finovate/FinDEVr alum Experian. The app enables individuals to use their spare change or “round ups” to pay for bills and other expenses. CreditRich promotes financial wellness by allowing users to prioritize debt payments – or to use the app’s algorithm to find and pay first those bills that have the most impact on the user’s credit score. Users can make one-time deposits to accelerate any debt repayment, as well as make contributions to a family member’s account to enable them to pay down debt and improve their credit score. The CreditRich app is currently available on the Android operating system, with an iOS expected soon.

“It makes sense to put financial literacy, intelligent billpay, and credit management together on a smartphone to help people increase their credit scores faster and easier,” Rich said late last year on the news that actor, singer, and songwriter Naturi Naughton had joined WealthyLife as Chief Branding Officer. “I don’t want people to experience the same hurdles I did after graduating from college with $180,000 of debt.”

Also the founder of Black Tech Matters, an organization dedicated to promoting ethnic diversity in STEM, Rich said she is looking forward to collaborating with Jones to advance financial education technology solutions. ansrsource, where Jones is Director of Corporate Partnerships, specializes in helping companies leverage digital technology to enhance their training and development strategies. The Dallas, Texas-based company’s clients range from 42,000-student Arizona State University to construction manufacturing firm Hilti.

As noted, the union between financial literacy and digital education represented by Rich and Jones also represents a union of rivals. Rich is an alum of the famous HBCU (historically black college/university) Hampton University in Virginia. Jones is a graduate of the equally-legendary HBCU Howard University in Washington, D.C.

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B2B Payments Innovator Paystand Secures $50 Million in Series C Funding

B2B Payments Innovator Paystand Secures $50 Million in Series C Funding

In a round led by new investor NewView Capital, blockchain-based commercial payments innovator Paystand has raised $50 million in funding. The company leverages the cloud and the Ethereum blockchain to power its Paystand Bank Network, a no-fee, digital B2B payment system used by more than 250,000 companies to make payments.

“With this new funding, Paystand is uniquely positioned to bring the benefits of blockchain to commercial payments so businesses can be more agile and competitive in the post-pandemic landscape,” Paystand CEO Jeremy Almond said. “Our vision is to create an open financial infrastructure that delivers a self-driving money experience for businesses and provides radically better economics for the industry itself.”

The investment takes Paystand’s total capital to more than $78 million. Also participating in this week’s financing were SoftBank’s Opportunity Fund, King River Capital, Industrious Ventures, and Transform Capital. As part of the investment, NewView Capital’s Jazmin Medina will join Paystand’s board of directors.

Paystand’s innovation is to automate the entire cash lifecycle to enable businesses to enhance the overall customer experience with seamless, B2B payment options. The company’s technology helps businesses accelerate time-to-cash, lower DSO (daily sales outstanding) by 60% or more, as well as reduce fraud and chargebacks thanks to real-time fund verification. And instead of charging businesses a percentage on each transaction, Paystand’s business model relies on subscriptions which the company says allows businesses to scale their payments operations without having to worry about dramatically increased fee-per-transaction expenses.

An alum of our developers conference, FinDEVr, Paystand was among the many fintechs who was able to turn the crisis of the global pandemic into an opportunity to support businesses that suddenly found themselves sprinting toward digital transformation. In a blog post discussing the challenges facing businesses during this time, Almond noted that while many companies had already migrated to the cloud for their “systems of record” (i.e., CRM, ERP, etc.), the “critical component” and “last mile” of digital transformation – revenue – was left underaddressed.

“Finance teams found themselves forced to return to the office at the height of COVID-19 outbreaks just to pick up checks and deal with cash flow,” Almond wrote, “something that clearly exposed the backwards nature of the legacy payment system.”

In May, Paystand inked a partnership with cloud business management solution provider Sage to enable a “Venmo for Businesses” like service via Paystand’s B2B payment network. The following month, the Scotts Valley, California-based fintech launched its Smart Lockbox, a digital-first alternative to traditional lockbox services. Smart Lockbox enhances the ability of businesses to transition away from paper-based payments to faster, less expensive, digital options, and makes migration easy with a seamless, one-click process.

“Smart Lockbox is the key tool that helps companies seamlessly bring their mission-critical revenue into the digital age,” Almond said when the solution was announced. “In a post-pandemic world, everything looks very different. COVID supercharged the push for digital transformation across the board for businesses, and there’s no question that this shift is here to stay. Now, with Smart Lockbox, finance teams can turn their biggest headaches into a newfound source of power.”

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AuthenticID Scores $100 Million in New Funding

AuthenticID Scores $100 Million in New Funding

AuthenticID, an identity proofing solution provider for the enterprise, has raised $100 million in funding from Long Ridge Partners. The investment will help the company continue to bring innovative identity proofing solutions to its customers in financial services, telecommunications, government, and other sectors.

“Our platform is relied upon by a majority of the U.S. wireless carriers and various identity platform to securely establish identity,” AuthenticID CEO Jeff S. Jani said. “Our differentiator is the significant ROI we deliver to customers, from stopping more fraud to converting more sales than our digital identity competitors. Our mission is to improve the security for all of our collective identities.”

Union Square Advisors, a boutique technology-focused investment bank, served as AuthenticID’s financial advisor in the transaction.

AuthenticID gives businesses the ability to conduct document-centric identity verification with a high degree of accuracy and fast processing times. The 100% automated solution helps companies increase conversion rates and eliminate fraud at a time when businesses are seeing a surge in the volume of customers who need to be digitally onboarded in order to use their services. AuthenticID leverages machine learning algorithms, AI-powered neural networks, and state-of-the-art computer vision to determine when photos and faces do not match, whether identification documents are fraudulent, and if either the name or face being analyzed has been associated with suspicious activity in the past.

Founded in 2001 by Blair Cohen, AuthenticID made its Finovate debut two years later at FinovateSpring. In the years since, AuthenticID has brought its technology to ten companies in the Fortune 100, three of the top U.S. banks, two of the top three credit reporting agencies, and three of the top five telecommunications companies in the U.S., as well as several international banks and companies around the world. Earlier this month, the company announced that it had reached a new milestone with the launch of its new enterprise-grade SaaS system that can process nearly 35 million identity proofing transactions in a day and more than one billion in a single month.

“AuthenticID has built a market-leading computer vision system to meet the ever-growing requirements of this market,” AuthenticID Chief Technology Officer Richard Huber Jr. said when the milestone was announced. “Our system sets a new standard for reliably and accurately verifying anyone’s identity from anywhere in the world.”

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India and Nigeria Consider CBDCs as Study Shows Strong Consumer Enthusiasm and Trust

India and Nigeria Consider CBDCs as Study Shows Strong Consumer Enthusiasm and Trust

Two of their respective regions’ most powerful economies are moving closer to the issuance of Central Bank Digital Currencies or CBDCs. In India, Reserve Bank of India deputy governor Shri T. Rabi Sanker said that the bank is working toward a “phased implementation strategy” that would further the country’s multi-year effort to transition its citizens away from cash. India’s efforts to remove cash from the economy, including innovations like the Unified Payments Interface (UPI) and the RuPay network have become increasingly accepted by Indian citizens. But both, as far as Sanker are concerned, face challenges from the persistence of cash and the promise of CBDCs.

With regard to the latter, Sanker has encouraged observers to envision a UPI system based on CBDCs rather than bank balances. In such a framework, there would be no need for interbank settlement and payment systems worldwide could benefit from greater cost efficiencies and faster, even real-time, transaction settlement. As far as the persistence of cash is concerned, small value transactions still make up most cash purchases in the country. But even here Sanker believes that with certain guarantees like transaction anonymity, CBDCs could be efficiently used for these transactions, as well.

Meanwhile in Africa, Rakiya Mohammed, Formation Technology Director for the Central Bank of Nigeria (CBN) told an audience recently that the country will launch its CBDC pilot on the first of October. The project, called Giant, has been in development since 2017 and runs on the open source blockchain Hyperledger fabric. The bank hopes that a CBDC will help support macro and growth management – as well as cross-border trade – and facilitate financial inclusion. Mohammed reportedly cited FOMO – fear of missing out – as one reason why the CBN could not risk sitting on the sidelines while other central banks around the world launched CBDC-related projects and initiatives.

The demand for CBDCs remains an open question to some degree. But proponents of the technology can take heart in a recent study conducted by European deep tech company Guardtime. The firm took a look at opinions toward CBDCs in ten countries including countries in Europe and Asia, as well as in the United States and the UAE. The study revealed that a majority of adults (64%) said that they would be likely to use a digital currency offered by their country’s central bank, with 33% saying they would be “very likely” to use a CBDC. Only 10% of respondents said they would “never” use a CBDC. The CBDC favorable position maintained a healthy lead over CBDC rejection both when it came to converting savings to CBDCs (59% support versus 11% “never”) and being paid in CBDCs (57% support versus 12% “never”).

Summing up the positive results for CBDCs suggested by the study, Guardtime Head of Strategy Luukas Ilves observed, “it is fascinating to see that 64% of people would be willing to use CBDCs – even though they have not been launched yet – and are happy to support and trust Central Banks to ensure digital currencies are delivered.”

Here is our look at fintech innovation around the world.

Middle East and Northern Africa

Central and Southern Asia

Latin America and the Caribbean


Sub-Saharan Africa

Central and Eastern Europe

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Currencycloud Valued at $963 Million On News of Visa Acquisition

Currencycloud Valued at $963 Million On News of Visa Acquisition

Global payments platform Currencycloud is the latest fintech to catch the eye of Visa, which announced this week that it has agreed to acquire the London-based fintech in a deal that values the company at $963 million (GBP 700 million). The acquisition announcement noted that the pact builds on a partnership that extends back to 2019 and bolsters Visa’s foreign exchange capabilities, enabling them to better serve FIs, fintechs, and other partners, as well as help them explore new use cases and payment flows.

“At Currencycloud, we’ve always strived to deliver a better tomorrow for all, from the smallest start-up to the global multi-nationals,” Currencycloud CEO Mike Laven said. “Re-imagining how money flows around the global economy just got more exciting as we join Visa.” Laven added that bringing Currencycloud’s expertise in fintech to Visa’s network will “enable us to deliver greater customer value to the businesses moving money across borders.”

Currencycloud will continue to operate out of its London, U.K. headquarters and its current management team will remain intact.

The acquisition news comes just a few weeks after the Currencycloud announced a partnership with Global Processing Services (GPS) to expand access to cross-border payments. The collaboration will give fintechs the ability to enhance their current product offerings with products like multi-currency digital wallets and services like point-of-sale foreign exchange.

“For Fintechs, building a multi-currency solution requires a huge effort across multiple functional and regulatory domains,” Currencycloud co-founder and VP of Partnerships & Enterprise Stephen Lemon explained when the collaboration was announced in June. “By working with Currencycloud and GPS, fintechs can reduce the complexity involved and get to market much more quickly for a fraction of the cost of self-building, while vastly reducing ongoing operational risk and overhead.”

A Finovate alum for more than six years, Currencycloud most recently demonstrated its technology on the Finovate stage in 2018, where the company presented its Global Collections product. Since then, Currencycloud has grown into a platform whose APIs have enabled processing of more than $100 billion in transactions for companies ranging from neobanks to financial services corporations. Currencycloud currently supports nearly 500 bank and fintech customers, reaching more than 180 countries.

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Dwolla Secures $21 Million in Funding to Innovate B2B Payments

Dwolla Secures $21 Million in Funding to Innovate B2B Payments

In a venture round led by Foundry Group, modern payments platform Dwolla has raised $21 million in new funding. The capital takes the company’s total funding to more than $70 million according to Crunchbase, and will help fuel the Des Moines, Iowa-based fintech’s growth initiatives, enhance its partner relationships, and drive the company’s product roadmap.

Also participating in the funding were Park West Asset Management LLC, Union Square Ventures, Detroit Venture Partners, Firebrand Ventures, and Next Level Ventures. Individual investor Jeremy Andrus, CEO of Traeger, also participated in the round.

The investment in Dwolla comes in the wake of a surge in transaction volume over the past year – due largely to the economic fallout from the COVID-19 pandemic. With an increase of 80% in transaction volume since the beginning of the crisis, Dwolla sees itself on track for more than $30 billion in transaction volume this year. The company noted that this week that it has onboarded approximately three million end users on its payments platform in the first six months of 2021.

“We continue to be excited at the speed of innovation and demands from the marketplace,” Dwolla CEO Brady Harris said in a statement announcing the investment. “We continue to see significant client and payment volume growth due in part to our new products like Real-Time Payments, Push-to-Debit, and our low-code solutions. This funding will allow us to fully capitalize on the momentum we’re experiencing, as we continue to scale our tech stack with innovative solutions and invest in go-to-market capabilities with international expansion and technical integrations with exciting fintech partners.”

This spring, Dwolla added real-time payment options to its platform. Powered by Cross River Bank, the Real-Time Payments solution uses the RTP Network to send money directly to bank accounts in seconds. The partnership enabled new businesses integrate Dwolla’s payment API to connect with RTP-enabled FIs and send money, while Dwolla’s current customers were able to begin using the technology simply by changing a single line of code.

“Today is game-changing,” Harris said when the new offering was announced in April. “Not just for adding real-time payments to Dwolla’s payments technology. But because of how we collaborated with a forward-thinking financial institution to make real-time payments easily accessible to businesses of all sizes. The immediacy of real-time payments will fundamentally change how businesses operate.”

Check out our profile of Dwolla from earlier this year. The company was founded by Ben Milne in 2008. Milne served as CEO of the company through March of 2020.

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Painproofing Mortgages, Engaging Customers, and Seizing the Opportunity of Crypto

Painproofing Mortgages, Engaging Customers, and Seizing the Opportunity of Crypto

This week, Finovate Podcast host Greg Palmer talked about the ways that fintechs can help homebuyers – and lenders – deal with the painpoints of the mortgage process. His guest, David Jegen, is a Managing Partner with F Prime Capital, one of the largest VC funds in the world that invests primarily in technology and health care.

Asked why the mortgage process is so painful, Jegen points to the fragmentation of the market as a large part of the problem. “One bank gives you the mortgage. Another bank buys the mortgage,” Jegen explained. “You have another servicer. And somewhere in between you’ve got real estate brokers, title agents, notaries, lawyers, and so forth.” All of this adds up to greater complexity and more cost.

Find out how Jegen thinks fintech is helping alleviate these problems and why the future of the mortgage market could be a bright one if the industry embraces change.

Finovate Best of Show winner Dreams made its Finovate Podcast debut in June. The company, headquartered in Stockholm, Sweden, leverages cognitive and behavioral science to help banks better engage their customers.

Greg Palmer talked with Lucia Hegenbartova, Chief Commercial Officer with Dreams on how humans make financial decisions and how Dreams’ financial wellbeing platform is an example of how banks can increase digital engagement and pursue a “future-proof stance” on social responsibility and sustainability at the same time.

“We take the bank’s existing financial products and we frame them in a way that takes into account how the human brain works and the role that emotion plays in human decision-making,” Hegenbartova explained. “(That) allows us to effectively help people to develop healthier financial habits, which is crucial to eliminating the barriers to engagement that are, more often than not, rooted in anxiety and lack of confidence.”

To this end, Dreams’ product suite includes variety of modules such as a Savings Booster debt management product and an Investing module – all of which are easily embeddable into mobile banking apps on top of existing functionality and can be used individually or in combination.

One of the most interesting intersections in finance is the nexus between financial technology and agriculture. In many places around the globe, many of those who can benefit the most from advances in technology – including fintech – are the farmers who are undoubtedly among the most essential workers in the world.

In this episode of the Finovate Podcast, Greg Palmer talks with David Davies, founder and CEO of AgUnity. The company leverages the blockchain and smartphone technology to help build trust and efficient digital supply chains from farmers to consumers. AgUnity helps solve key issues for underbanked agricultural workers and farmers including the lack of digital identities, a lack of trust in local financial and governmental systems, money safety, data reliability, and more.

“We take low-cost smartphones, phones that cost about $50, and we transform them into a relevant and useful tools for the very lowest income farmers in the world in places like Papua New Guinea and Ethiopia,” Davies said. Most of these farmers AgUnity works with have never owned a phone, he explained, have relatively low literacy and are often in very remote locations. So the phones are redesigned to be relevant to their experience in terms of both interface and off-line functionality. AgUnity also provides the farmers with a digital identity and records transactions for them on the blockchain.

This helps build trust and cooperation between small groups of farmers and enables them to interact with buyers and suppliers more effectively and efficiently. Learn more about AgUnity and its unique contribution to fintech innovation and the cause of financial inclusion.

Just over a month ago, Greg Palmer talked about the “democratization of payments” with Sesie Bonsi, CEO and founder of Finovate alum Bleu. Founded in 2014 and headquartered in Los Angeles, California, Bleu enables merchants to accept contactless payments using their smartphone or mobile device. The company’s wireless payment network supports a patented mobile transaction process that uses Bluetooth-based low energy beacons to communicate payment data between customers and merchants.

In this conversation, Bonsi and Palmer take on the challenge and opportunity of cryptocurrencies, looking specifically at how digital assets can serve as a source of wealth accumulation for marginalized groups.

“Something I tell a lot of people is that the single most important thing you can be doing for wealth creation right now is entering into the cryptocurrency space and getting involved and doing your research and buying crypto,” Bonsi said. He puts cryptocurrencies in the same category as land, oil and gas, mineral resources in that they all derive their value largely from their scarcity, and notes that acquiring finite resources traditionally been a successful strategy for wealth accumulation.

“From those assets,” Bonsi said, “they become collateral and from that collateral you can lend against it to buy real estate, or to open up a business, or to invest in stock, and thereby have assets to pass down for future generations.”

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Best of Show Winner Lendsmart Inks Integration Deal with Freddie Mac

Best of Show Winner Lendsmart Inks Integration Deal with Freddie Mac

Lendsmart, which took home Best of Show honors in its FinovateFall debut last year, announced a new partnership with Freddie Mac this week. The digital lending platform has integrated with Freddie Mac Loan Product Advisor, the firm’s automated underwriting system, to improve the loan origination process for both lenders and borrowers by reducing processing time.

“Lendsmart’s software predicts the credit and underwriting conditions required in the loan origination process by pinning them to a borrower’s data in real-time rather than making the borrower wait 45 days to get an email from the underwriter,” Lendsmart founder and CEO AK Patel explained. “We’re also shaving off weeks in the letter of explanation process.”

Headquartered in New York City, Lendsmart combines an AI-powered digital lending platform with a home buying marketplace to save lenders time, help them increase productivity, and grow their profits while providing both the lender and the homebuyer with a “next-generation digital experience,” in the words of Lendsmart COO Philip Gem George.

Lendsmart’s platform centralizes and unifies all parties in the mortgage process while automating manual tasks to ensure accuracy, reduce risk, and keep costs low. George noted during the demo of Lendsmart’s technology at FinovateFall that the automation ensured that homebuyers are only asked for information that cannot be readily accessed from the documentation. This further accelerates the process and relieves some of the burden typically felt by homebuyers during the origination process.

And as Freddie Mac VP of Business Partner Integration Kevin Kauffman added, technology like that available from Lendsmart helps financial institutions keep up with the expectations of their increasingly digital-first customers. “Today’s lenders and borrowers expect a seamless digital process that isn’t burdened with administrative tasks or excessive timelines,” Kauffman said. “Partnering with Lendsmart allows Freddie Mac to provide the latest technology that satisfies out mutual clients’ needs.”

Founded in 2019, Lendsmart was among the many fintechs that helped facilitate PPP funding during the COVID-19 pandemic, partnering with Griffin Technologies to offer banks and credit unions an end-to-end solution to enable them to process more loan applications while identifying and pursuing qualified small business leads. “With financial institutions struggling to manage the high number of applications and small businesses in need of immediate funds,” Patel said when the partnership was announced last spring. “We saw an opportunity to speed up and simplify the mostly manual process by using our existing technology.”

Lendsmart began the year raising an undisclosed amount of pre-seed funding from INV Fintech. In addition to its New York headquarters, the company also has an office in India.

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Square Unveils its Small Business Banking Offering

Square Unveils its Small Business Banking Offering

Square’s point of sale solutions have played a major part in the success of millions of small-scale merchants and sellers over the past decade. Today’s announcement that the company will offer new banking services reveals the San Francisco-based merchant services innovator as the latest fintech to leverage banking to deepen engagement with its customers.

Square Banking, as the new offering is called, consists of two new deposit accounts – Square Savings and Square Checking – as well as the company’s rebranded Square Capital lending solution, now called Square Loans. The new savings accounts offer a 0.5% APY, and feature an automated savings function that makes it easy for merchants to set aside a percentage of every sale made on the Square platform. The new checking accounts have no account minimums, do not feature recurring fees, and do not charge for overdrafts.

“With Square Banking, we’ve reimagined the financial system for small business owners with their cash flow needs at the center,” Square Banking Head of Product Christina Riechers explained. “We’re introducing fair, accessible financial services that connect directly with our sellers’ payments, helping them unlock instant access to their sales, automate their savings, and receive personalized financing offerings.”

There are two interesting aspects of Square’s expansion into banking services. The first, as Riechers noted, is the ability of Square to leverage its relationship with its merchant partners into a potentially fast-growing small business banking customer base. The second aspect of Square’s move is that, unlike other fintechs that are looking to add banking services to their product suite, Square already has its own bank. Square Financial Services began operations in March after securing approvals from the FDIC and the Utah Department of Financial Institutions (DFI). That said, according to Reuters, only small business deposits will be a part of Square Financial Services for now. Business checking accounts, and the accompanying Square Debit Card, will continue to be FDIC-insured courtesy of a partnership with Sutton Bank.

Founded in 2009 by Jack Dorsey and Jim McKelvey, Square is a publicly traded company on the New York Stock Exchange under the ticker SQ. The firm has a market capitalization of $111 billion.

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Digital Investment Platform Munnypot Acquired by Cairngorm Capital

Digital Investment Platform Munnypot Acquired by Cairngorm Capital

Sometimes a partnership is not enough and only a full-fledged union will suffice.

This is the approach taken by Cairngorm Capital, a U.K.-based private equity firm that announced this week that it had acquired FinovateMiddleEast alum Munnypot – along with investment management services provider Whitefoord – in order to launch a new digital wealth management firm, Verso Wealth Management.

“Our firm believes that the parallel trends of the increased complexity of consumers’ advice needs, their growing adoption of digital services and rising automation in wealth management will endure over the long term,” Cairngorm Capital’s Neil McGill explained. “The combination of award winning technology, high quality advice, and an exceptional management team ensures that the Verso Group is well placed to capitalize on this.” 

Founded in 2015 and making its Finovate debut three years later in Dubai, Munnypot was developed to serve both mass market investors who struggle to secure traditional financial advice, as well as existing investors looking for a goal-based, low-cost, digital alternative. Munnypot offers Individual Savings Accounts (ISAs), General Investment Accounts (GIAs), and Junior ISAs (JISAs) that enable parents to make investments on behalf of their children. Designed for investment and savings goals that are at least five years in the future, Munnypot analyzes the investor’s objectives and other key details to provide tailored advice on the most suitable investment plan to meet those goals

The new firm will be run by Munnypot CEO Andrew Fay and Managing Director Simon Redgrove, who will take identical positions in leadership for Verso. Also joining Verso’s executive ranks will be Whitefoord Chief Executive Vince Whitefoord who will lead the firm’s discretionary investment management business. Verso will operate as a combination of human expertise from its client advisors and investment professionals with an automated investment advice capability. This approach is designed to appeal to a broader range of potential customers, including small savers and those new to equity investing.

“Verso will make it far easier for advisors to maximize efficiency, reduce compliance risk and increase revenue,” Fay said. “Our goal is to become the leading digitally driven IFA consolidator and there’s no limit to our ambition.”

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Blend Raises $360 Million in IPO; Achieves $4 Billion Valuation

Blend Raises $360 Million in IPO; Achieves $4 Billion Valuation

Mortgagetech innovator Blend is the latest fintech to go public. The company, which unveiled its “data-driven mortgage” solution in its Finovate debut five years ago, made its debut as a publicly traded company on the New York Stock Exchange last week under the ticker BLND. Blend raised $360 million in the IPO, earning a valuation of $4 billion.

In a blog post, Blend CEO and co-founder Nima Ghamsari reflected on the irony of launching a mortgagetech business “out of the ashes of the great recession” in 2012. The goal then was to build a solution that leveraged technology and data to made financial services simpler and more transparent, specifically in the “complex and paper-based” mortgage process. Since then, the company has expanded its product portfolio beyond mortgages to include initially home equity loans and lines of credit, before helping streamline origination workflows for financing products ranging from personal loans and credit cards to deposit accounts. This expansion has allowed Blend to enable its financial institution clients to cross-sell personalized offers and services to their customers and members.

“At every step of our journey, our customers have asked us to build more,” Ghamsari wrote. “That’s why this moment means so much to me and everyone at Blend.

A winner of the NAFCU Services 2021 Innovation Award for Best Digital Lending Platform in June, Blend facilitated more than $1 trillion in loans in 2020, an increase of 2x over the previous year. The company also introduced a variety of new platform features in 2020 including a new loss mitigation workflow for homeowners, and a digital portal to process PPP loans. Blend currently has more than 290 lender partners, representing 30% of all mortgage volume in the U.S.

Headquartered in San Francisco, California, Blend began the year with a $300 million Series G round, featuring participation from Coatue and Tiger Global Management. The funding gave the company a valuation of $3.3 billion. This January investment was less than six months after the company secured a $75 million Series F financing led by Canapi Ventures.

In addition to its debut at FinovateSpring in 2016, Blend is also an alum of our developer’s conference, FinDEVr. At the event, the company’s technical team showed the thinking behind the design of its platform including the importance of automated workflows, data connectivity, and innovation by design.

Photo by Tirachard Kumtanom from Pexels