Author: David Penn

Ximena Aleman on Open Banking and Financial Access in Latin America

Ximena Aleman on Open Banking and Financial Access in Latin America
By David Penn Posted on
Categories: Finovate Global, Mambu, Nubank

The fintech industry in Latin America is among the world’s most vibrant. From the initiatives in Mexico to provide a legal framework that will enable local fintechs to flourish, to the innovations in central bank digital currencies in the Caribbean, to the rising fintech giants like Nubank in Brazil, financial technology is making a major difference in the lives of a growing number of Latin Americans.

For this week’s Finovate Global: Voices, we caught up with Ximena Aleman, co-founder and Chief Business Development Officer of Prometeo, to discuss fintech in Latin America and the power of open banking to improve financial wellness and create opportunity in the region.

Please tell us a little about Prometeo and what drove you to co-launch the company.

Ximena Aleman: Prometeo is a fintech company striving to create an open and connected financial market in Latin America (LATAM). We are building a huge highway of financial information across financial institutions and countries in LATAM. Prometeo is the largest Open Banking API platform in the region disrupting the financial sector in México, Colombia, Brazil, and six more countries. We provide a single point of access to information, transactions, and payments across more than 30 financial institutions and 45 APIs in nine countries of LATAM. 

As LATAM entrepreneurs, we are well aware of the tech gap in the financial sector between underdeveloped and developed countries. In particular, the lack of adequate tech infrastructure. So we decided to approach this as an opportunity to build not only a great solution but also a path towards financial access for the region. 

What are the drivers of open banking in Latin America?

Aleman: Open Banking is a disruptive innovation that reframes the way banking is carried out. Transactions and communications between customers and institutions are going from taking place behind closed doors to transparent exchanges in the public square. It is no wonder that traditional financial institutions initially viewed the practice with a measure of bemusement or even suspicion.  

However, there has been a marked shift in their thinking. Adoption has been slower in Latin America than in other parts of the world, but most of the open banking biggest names in the region have headquarters abroad. Open banking has been a hot topic globally; Latin American associates have taken note and ushered in the conversation.

Another factor that has changed the playbook is the COVID-19 pandemic. The restrictions on daily life and public interactions have forced even the most hard-rooted, traditional financial institutions to review their digital transformation strategies. If customers can’t visit branches, digital channels become the sole venue of exchange. 

What do you think it will take to get more women in leadership and founding roles in fintech?

Aleman: I think that as we move forward to a more “gender-balanced” society we have to rethink our financial exchanges from a gender perspective, too. There’s little offered in the financial sector for women and little by little some female fintech entrepreneurs are developing solutions for this segment (for instance, Emma Sanchez’s neobank for women, Jefa). If the startup ecosystem understands that half of the world’s population has been historically financially underserved, and the huge opportunity this is, it won’t take long for women to start developing custom-made products for that segment.

You have said two of the biggest challenges to diversity in fintech are funding and technical training. What can and should be done about this?

Aleman: The gap between VC investments in startups led by women is significant versus those led by men. In the last 10 years, fintech companies led by women have raised 1% of the total investment in fintech. The disparity is really significant.

I believe this gap is multifactorial: historically, the financial and the technology worlds were dominated by men. Also, among VC funds, women in the decision-making process are just a few in number and, per my own experience, men really value having another man as their counterpart. 

There’s a lot we can all do: all the stakeholders involved in the fintech sector should make their own changes and push to close the gap. As women, we have to create our support network on every front, talk to mentors, female start-up groups, and above all, be confident and trust your knowledge, your experience, and your ability to navigate through hostile environments. If you feel you are not strong enough in certain areas, seek training. Technical training and really knowing your business is key to build confidence and close this gap.

One of the biggest reasons why women receive less VC investment than men is that so few of them make up decision-makers in VC funds.

How has the pandemic impacted the work you do and the communities you serve?

Aleman: Open Banking has seen a rise in LATAM in the past year, so our business vertical – as everything related to digital transformation in the financial sector – has been benefited by how the pandemic reshaped human interactions. However, no one in LATAM can be a stranger to the economic challenges we are facing today and ahead. There have been huge increases in unemployment, debt, etc. In Uruguay, a year after the pandemic, surfing what might be the country’s second wave of COVID-19 cases, early in the morning in the small towns in the countryside, you will bump into people waiting in line just in one shop, in the local microfinance branch, to ask for credit or pay their debt.

There are many who do not know much about Uruguay. What do you think more people should know about the country?

Aleman: Of course. I’m very proud of my country. We are a small country down in South America, between Argentina and Brazil. We are popular for the quality of our meat and football players, but as noticeable as that is, we are a growing tech hub, in particular for financial services. Uruguay has a long history of providing high-tech software to the financial sector, for instance, we host four banking core software companies (Infocorp, Topsystems, Bantotal, and Mantentia – that was recently bought by Technisys). Most recently, we joined the fintech wave with great B2B solutions like Bankingly or our first local unicorn, dLocal. I think it is worth mentioning the government’s efforts to promote entrepreneurship through the Innovation Agency (ANII) and Development Agency (ANDE). We are well aware that Prometeo was possible thanks to their support and as a startup, we are a result of the whole ecosystem pushing us to grow.

What can we expect from Prometeo over the balance of 2021?

Aleman: We are pushing hard for Open Banking adoption in Brazil, México, and Colombia. For those countries, it’s a challenging shift so we want to provide the best possible solution. That’s why we are releasing a payment feature that allows automated payments across banks in those countries. At the same time, we are on a mission to provide full coverage across LATAM. So this year it’s all about expansion, coding, and growth! 

Learn more about fintech in Latin America and the work of Prometeo.

Here is our look at fintech around the world.

Middle East and Northern Africa

Central and Southern Asia

Latin America and the Caribbean

Asia-Pacific

Sub-Saharan Africa

Central and Eastern Europe

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Ramp Scores $115 Million to Help Businesses Spend Smarter

Ramp Scores $115 Million to Help Businesses Spend Smarter
By David Penn Posted on
Categories: Daily news, Funding

Here’s an idea: a corporate card that incentivizes spending less rather than rewarding you for spending more.

Ramp, a New York-based fintech launched by Eric Glyman, Gene Lee, and Karim Atiyeh, has raised $115 million in Series B funding to power this approach to business expense management. Taking Ramp’s total capital to $320 million, the investment gives the company a valuation of $1.6 billion.

“Co-founding a fintech unicorn was never my plan,” Ramp CEO Glyman wrote on the company’s blog in a funding announcement, “and almost feels crazy given my job 12 years ago was selling t-shirts and jeans.”

The round was led by D1 Capital Partners and Stripe. Joining them were Founders Fund, Coatue Management, Thrive Capital, Redpoint, and Box Group. Ramp also announced that it had received a $150 million line of debt financing from Goldman Sachs. “During our next phase of growth,” Glyman added, “we plan to expand our efforts to bring the value of Ramp to more businesses in more places and to transform the way more companies do business.”

Ramp offers a corporate card with unlimited 1.5% cash back on every transaction, 10x to 20x higher limits and no fees, and both smart virtual and physical cards with built-in spend management controls. An integration with Slack makes it easy for managers to get alerts, approve expenses in real-time, and respond to issues from within the business communication platform.

Ramp says that it has identified more than $10,000,000 in annualized savings for 1,000+ customers, with the average Ramp customer saving in excess of $100,000. Companies using Ramp’s spend management platform range from startups to corporations, and include technology innovators in their own right such as Clubhouse and Finovate alum Marqeta. The technology is integrated with popular accounting platforms such as Netsuite, Sage Intacct, Xero, QuickBooks, and more than 100 others.

Onboarding its first company in 2019 and launching publicly one year later, Ramp has experienced 4x growth over the past six months. Glyman said the company is approaching annualized transaction volume of more than $1 billion.

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Plaid Scores $425 Million in Series D Funding

Plaid Scores $425 Million in Series D Funding
By David Penn Posted on
Categories: Funding, Plaid

Plaid to DOJ: No acquisition? No problem.

There has been no stopping Plaid since the U.S. Department of Justice put the kibosh on its planned acquisition by Visa at the beginning of the year.

Last week, the financial data connectivity platform announced that it was collaborating with fellow Finovate alum DriveWealth. Before that, the company introduced the first graduates of its diversity-oriented fintech accelerator, FinRise; announced a partnership with Dun & Bradstreet; and unveiled its new income verification tool, Plaid Income.

Today brings news that Plaid has secured a massive $425 million investment in a round led by Altimeter Capital. The Series D round also features participation from Silver Lake, Ribbit Capital, and other current investors, and gives the firm a total capital amount of more than $734 million. Now sporting a valuation of $13.4 billion, Plaid said it will use the additional capital to “grow its platform, invest in infrastructure, payments capabilities and global expansion,” according to the company’s U.K. head, Keith Grose.

In a blog post titled “Digital finance is everywhere, but it’s just getting started,” Plaid CEO and co-founder Zach Perret described how, in some ways, the dream that led to the founding of Plaid “nearly a decade ago” is beginning to come true. “We dreamt of a financial system that was built to empower consumers and unlock financial freedom for everyone,” Perret said. “We are humbled to watch as fintech continues to expand and improve the financial lives of billions of people worldwide.”

More specifically, Perret’s post makes it clear that “scale” is the next big objective for the San Francisco, California-based fintech. In order to meet increasing global demand, as well as deliver on the growing expectations of ever-more-digitally-savvy consumers, Plaid will continue to invest in API technology as well as “tools and services to support enhanced privacy, personalization, decisioning, and automation.”

Founded in 2012, Plaid made its Finovate debut two years later at our developers conference, FinDEVr. The company has grown from an API-building technology infrastructure startup to now also offer key insights into the data access it provides via a suite of analytics solutions. Plaid’s technology enables users to access detailed transaction histories, setup direct debits and payouts, verify borrower assets, user identities, and real-time account balances; and make instant, in-app bank payments.

Since inception, Plaid has analyzed more than 10 billion transactions. Use cases for the company’s technology range from personal finance, lending, and wealth management, to consumer payments, banking, and business finance.

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Rho Technologies Brings its BaaS Solution to Sterling National Bank

Rho Technologies Brings its BaaS Solution to Sterling National Bank
By David Penn Posted on
Categories: Daily news

New York City-based Rho Technologies has inked a partnership with Sterling National Bank, the principal subsidiary of Sterling Bancorp that specializes in serving small-to-medium sized businesses as well as consumers. Sterling will leverage Rho’s digital Banking-as-a-Service platform, Rho Business Banking, to support its customer growth and expansion objectives.

Sterling National Bank’s Matthew Smith, Executive Managing Director for Direct Banking and BaaS, called the partnership “an important step” in expanding its portfolio of BaaS arrangements, as well as speeding up the bank’s “organization-wide digital transformation to offer customer-centric, digitally-enabled solutions to the marketplace.”

The Rho Business Banking platform combines collaborative finance software and commercial-grade banking in a single solution. Relying on a unified platform, team members can take advantage of integrated, intelligent solutions for A/P, budgeting, data automation, and accounting integrations. Rho offers no-fee global payments, up to 1.5% cash back on all spending, and access to its team of “world-class bankers.”

“Rho is thrilled to collaborate with Sterling National Bank,” Rho Technologies CEO and co-founder Everett Cook said. “We spent a lot of time seeking a partner that had the capabilities and scale that our current and future customers need. We look forward to working with Sterling in supporting our future product and service offerings.

With more than $30 billion in assets, Sterling National Bank made fintech headlines earlier this year when it announced a partnership with Google Pay to offer digital checking and savings accounts through the Google Pay platform. Headquartered in New York, Sterling National Bank also teamed up with Goalsetter during African American History Month to provide seed funding for a program to support financial inclusion and literacy among students in underserved communities.

“This critical initiative reinforces Sterling’s commitment to financial education and empowering young people to reach financial independence,” Smith said. “Black History Month provides an important opportunity to celebrate and promote Black achievement. We are excited to play a part in supporting these inspiring young men to become the next leaders, savers, and investors.”

Rho Technologies began the year with news of a $15 million investment courtesy of a Series A round led by M13 Ventures. The funding, which took the company’s total capital to $19.9 million according to Crunchbase, enabled Rho to launch an integrated accounts payable platform as part of an expansion of its flagship Business Banking offering.

“We’ve developed the modern commercial banking platform built around the way companies operate today: distributed, team-oriented, transparent, and built for scale,” Cook said when the funding was announced in January. “AP is the next step on our mission to help teams work better together with money.”

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Fintech Innovators Get Ready for FinovateSpring Debut

Fintech Innovators Get Ready for FinovateSpring Debut
By David Penn Posted on
Categories: FinovateSpring 2021

Spring is the time for newness and novelty. And with FinovateSpring a little over a month away, there’s no better time than the present to introduce a “Who’s New” of innovative fintech companies making their Finovate debut at our all-digital spring conference, May 10 through 13.

BaseCap Analytics: Specializes in analyzing data, diagnosing, and solving problems for banks, insurance companies, and other highly-regulated industries. Headquartered in New York. LinkedIn. @BaseCap_Inc

Coconut Software: Provides cloud-based, customer engagement software solutions that empower community banks and credit unions. Headquartered in Saskatoon, Saskatchewan, Canada. LinkedIn. @coconutsoftware

DigiShares: Offers a white-label platform for the issuance, management, and trading of tokenized securities. Headquartered in North Jutland, Denmark. LinkedIn. @digisharesdk

FINBOA: Offers back office automation solutions to help community and regional banks meet regulatory obligations. Headquartered in Houston, Texas. LinkedIn. @finboatweets

FinHealthCheck: Offers a measurement, benchmarking, and insights platform to help employers better understand the financial health of customers and employees. Headquartered in Chicago, Illinois.

Foxit Software: Provides fast, affordable, and secure PDF solutions for businesses and consumers to enable them to “do more with documents.” Headquartered in Fremont, California. LinkedIn. @foxitsoftware

Loan Pro: Offers a SaaS loan servicing solution that leverages automation and data visibility to empower tech-forward lenders. Headquartered in Farmington, Utah. LinkedIn.

Secure: Offers an emergency savings solution to help employees automatically improve financial wellness and feel more financially secure. Headquartered in Kirkland, Washington. LinkedIn. @SecureSave1

Signal Intent: Builds next-generation financial calculators for banks, credit unions, mortgage companies, and insurance companies. Headquartered in New York. LinkedIn.

Urjanet: Leverages its cloud-based, data collection platform to make the world’s utility data easily accessible and usable. Headquartered in Atlanta, Georgia. LinkedIn. @Urjanet

Check out the growing roster of companies that are already on-board for FinovateSpring next month. And be sure to visit our registration page to pick up your ticket and save your spot for our annual spring fintech event!

Looking for an opportunity to demo your latest fintech innovation? Reach out to our Events Team today and find out how to be a part of FinovateSpring in May.

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More Than $3.3 Billion Raised by 26 Alums in Q1 of 2021

More Than $3.3 Billion Raised by 26 Alums in Q1 of 2021
By David Penn Posted on
Categories: Alumni News, Funding, Fundings, Quarterly Funding

When it comes to the competition for investment dollars, Finovate alums are off to their best start to date. Having raised more than $3.3 billion in funding in the first three months of 2021, companies that have demoed their innovations on the Finovate stage are attracting VC capital at the fastest rate in years.

In fact, Finovate alums in Q1 of 2021 raised more money than in the previous four first quarters combined.

Previous quarterly comparisons

  • Q1 2020: $1.3 billion raised by 14 alums
  • Q1 2019: $468 million raised by 20 alums
  • Q1 2018: $1.3 billion raised by 26 alums
  • Q1 2017: $230 million raised by 20 alums
  • Q1 2016: $656 million raised by 32 alums

This year’s powerful first quarter came courtesy of nearly a dozen, nine-plus figure investments. Global breadth was wide. Among the countries represented by the quarter’s top ten equity investments are Sweden, Brazil, Germany, and the U.K. And within the U.S., innovators from familiar locations in Silicon Valley share our top ten list with fintechs from Boston, New York, and Lehi, Utah.

Top Equity Investments

  • Klarna: $1 billion
  • Nubank: $400 million
  • Blend: $300 million
  • MX: $300 million
  • Feedzai: $200 million
  • Jumio: $150 million
  • OutSystems: $150 million
  • Mambu: $135 million
  • Stash: $125 million
  • Blockchain.com: $120 million

The top ten equity investments of the quarter represented $2.88 billion or 87% of the quarterly total. As large as these investments were, they represented a smaller share of the quarter’s overall total than we’ve seen in the past few years. In 2020, the top ten investments made up more than 99% of the Q1 total. In 2019, the top ten represented more than 91% of the total raised by Finovate alums for the first quarter.

Here is our detailed alum funding report for Q1 2021.

January: More than $1.3 billion raised by 10 alums

February: More than $533 million raised by eight alums

March: More than $1.5 billion raised by eight alums

If you are a Finovate alum that raised money in the first quarter of 2021 and do not see your company listed, please drop us a note at [email protected]. We would love to share the good news! Funding received prior to becoming an alum not included.

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Digital Onboarding Inks Partnership with Small Business Resources

Digital Onboarding Inks Partnership with Small Business Resources
By David Penn Posted on
Categories: Alumni News, Daily news, Digital Onboarding

Digital Onboarding, a company that offers solutions to enable banks and credit unions to better engage their customers, has announced a partnership with Small Business Resources (SBR). The company, which helps banks acquire small business deposits, and provides treasury management and lending services, will use Digital Onboarding’s platform to help its client banks boost engagement and increase revenue.

Specifically, the collaboration will enable Small Business Resources to offer a new branded solution, SBR FullWallet, to better serve the 42% of SMEs that, according to research from Accenture, believe that alternative providers can do a better job than traditional banks when it comes to serving small and medium-sized businesses.

“For banks, small businesses are significantly more profitable than consumers, but a large percentage of small business customers are unengaged and at risk,” Digital Onboarding CEO Ted Brown explained. “I am thrilled to partner with Small Business Resources to help regional and community banks deepen their business relationships and better compete in today’s marketplace.”

The challenge of new rivals was top of mind for Small Business Resources CEO Robert Boorin, as well. “Banks are facing stiff competition from fintechs and Neobank providers that are investing heavily to attract small and medium-sized business banking customers,” Boorin said. “Business banking relationship managers struggle to build deep relationships with all of the customers in their portfolios. SBR FullWallet will enable our Partner Banks to deliver timely and highly personalized communications that make it easier for small businesses to adopt additional products and digital banking services.”

Launched in 1998, SBR was founded to bring small business marketing solutions to institutions in financial services, insurance, and other strategic industries. With services ranging from customer acquisition and engagement to cross-selling and onboarding, SBR blends traditional and digital media services to ensure that financial institutions have multi-channel access to SMEs.

Digital Onboarding most recently demonstrated its technology at FinovateFall in 2018. At the event, the company showed how its platform gives banks and credit unions the email and marketing automation resources to create personalized digital journeys that educate and engage their customers. More recently, Digital Onboarding has announced partnerships with a sizable number of regional banks and credit unions including American Bank of Commerce, New York University FCU, Pacific Service Credit Union, Spirit FCU, and Southwest Financial FCU – all in the first quarter of 2021.

Digital Onboarding has also been a ready partner to its fellow fintechs – including some fellow Finovate alums. In March, Digital Onboarding partnered with both Moven to support user adoption of a turnkey digital bank-in-a-box, as well as with StrategyCorps to help financial institutions “maximize the profitability of checking account relationships.”

Headquartered in Boston, Massachusetts, Digital Onboarding was founded in 2015. The company has raised more than four million dollars in funding from investors including FINTOP Capital, Detroit Venture Partners, and Jack Henry & Associates. Digital Onboarding’s most recent financing came in August of last year; the amount of the investment was not disclosed.

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Fintech Innovation and Open Banking in the Nordics

Fintech Innovation and Open Banking in the Nordics
By David Penn Posted on
Categories: Finovate Global

This week we learned that Norway-based Finovate alum Signicat has teamed up with a German software company Cryptshare to market a new B2B identity verification solution. The technology combines email encryption and secure file transfer with trusted sender and recipient identities to make business communications safer and more accountable.

In other fintech news from the Nordics, Santander Consumer Bank in Norway went live with a new PFM app that leverages open banking solutions from Nordic API Gateway. Founded in 2017 and headquartered in Copenhagen, Denmark, Nordic API Gateway made its Finovate debut last month at our all-digital fintech conference, FinovateEurope.

At the event, co-founder and CTO Gudmundur Hreidarsson demonstrated how the company’s platform simplified open banking payments and access to financial data, offering powerful account-to-account payment services through a single API. More than 40 financial institutions in Europe – including Lunar, Danske Bank, OP Financial Group, and Checkout Finland – rely on Nordic API Gateway’s open banking services.

“Current payment rails such as cards are very expensive for businesses and and increasingly inconvenient for consumers,” Hreidarsson said during his presentation last month. “Open banking changes that. It enables payments with low fixed fees per transaction rather than the high percentage fees of cards which can mean very significant cost savings for businesses – and is very convenient for consumers.”

“But getting into open banking and using open banking is hard,” he added. “It’s really hard. The APIs of the banks are slow to mature and there is still quite some way to go. Businesses are just starting to realize what kind of use cases can be solved with open banking. And consumers are only now discovering the convenience of paying with their accounts. That’s why we built Aiia, to offer an open banking platform that simply works.”

Companies from the Nordics (Denmark, Norway, Finland, Sweden, Iceland, and Greenland) have been well represented at FinovateEurope of late. This year alone featured – in addition to Nordic API Gateway – two companies from Sweden: Stockholm’s Dreams and Gothenburg’s Econans. Our most recent in-person FinovateEurope conference – held in Berlin, Germany – featured three companies from the region, as well: ReceiptHero and NordCheck of Finland, and Subaio of Denmark. Other Nordic fintechs that have demonstrated their technologies live on the FinovateEurope stage over the years include BehavioSec, Tink, and Klarna (Sweden); Encap Security, EVRY, Monobank, and Spiff (Norway); Meniga and Trustev (Iceland/U.K. and Iceland); and Mistral Mobile (Finland).

“It certainly seems that Schumpeterian destruction, where creating new markets is preceded by old ones being challenged or even destroyed, applies in the Nordics,” the team of Frida Jonsdottir, Olli Toivonen, Visa Jaatinen, Arttu Utti, and Richard Lindqvist wrote in the introduction to their FinTech in the Nordics: A Deloitte Review. “The Nordic FinTech market is rapidly growing and diversifying, with more companies and new technologies being created. This is happening regardless of the fact that the incumbent financial institutions are challenged by the lagging economic growth rates and ever changing regulatory burden, both of which afflict those who are looking to enter the market.”

Read the rest of the Deloitte report on fintech in the Nordics. For more about fintech in the region, check out:

Here is our look at fintech innovation around the world.

Central and Eastern Europe

Middle East and Northern Africa

Central and Southern Asia

Latin America and the Caribbean

Asia-Pacific

Sub-Saharan Africa

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FinovateFocus: From Payments and Remittances to Data Technology

FinovateFocus: From Payments and Remittances to Data Technology
By David Penn Posted on
Categories: FinovateFocus, Speaker series

This week featured the second of our new, all-digital FinovateFocus conferences. With a theme on payments, remittance, and foreign exchange within the fintech industry, our day-long offering of rapid-fire presentations and live roundtable Q&A sessions provided a fast-paced, no-fluff opportunity for financial services professionals to get up to speed on the latest in fintech – and to make the kind of high-quality connections that will lead to partnerships and collaborations in the weeks and months to come.

Scheduled for the fourth Thursday of every month, FinovateFocus enables like-minded professionals to discuss top issues within fintech, advance business objectives, and grow their networks.

To whet your appetite for our upcoming FinovateFocus in April, which will focus on Data Technology, here’s a look at the speakers and topics from our just-concluded FinovateFocus in March. In the meanwhile, to learn more about our upcoming April FinovateFocus event on April 22nd, visit our FinovateFocus hub today.

  • Millicent Tracey, Digital Payments Advisor, NACHA, on the buy now/pay later phenomenon in e-commerce. LinkedIn
  • Fergal de Clar, Marketing Manager, Fabrick International, on managing subscriptions from your banking app as a value-add for customers and an opportunity for customer engagement. LinkedIn.
  • Josh Stephens, VP of Product, Current, on the rising importance of instant payments. LinkedIn.
  • Matt King, Head of Payments Platform, Brex, on the build it or buy it innovation question with regard to financial partnerships at a time of hypergrowth. LinkedIn.
  • Timothy Chiodo, Director & Lead Analyst: Payments, Processors and Fintech, Credit Suisse, with a selection of key themes and topics on the minds of payments, processors, and fintech investors. LinkedIn.
  • Colin Wynd, Head of Real Time Payments Technology, The Clearing House, on the impact of faster and real-time payments. LinkedIn.
  • Mark Ruddock, CEO, BFS Capital, on how a new generation of small business owners is demanding change. LinkedIn.
  • Christopher Simco, VP, Emerging Payments Product Management, TD Bank, on how payments and innovation tempo are shaping consumer trust in banking. LinkedIn.
  • Gilles Ubaghs, Senior Analyst, Aite Group, on innovation in the payments industry, the familiar versus the new. LinkedIn.

To learn more about our upcoming April FinovateFocus event on April 22nd, visit our FinovateFocus hub today.

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Signicat Teams Up with Cryptshare to Enhance Identity Verification in the Enterprise

Signicat Teams Up with Cryptshare to Enhance Identity Verification in the Enterprise
By David Penn Posted on
Categories: Alumni News, Daily news, Signicat

A partnership between digital identity company Signicat and German software solution provider Cryptshare soon will bring to market a new B2B identity verification solution. The new offering marries platform-independent email encryption and secure file transfer technology with trusted sender and recipient identities to ensure secure business communication as well as legal proof of the sender and recipient. With a broad range of use cases in both retail and enterprise markets, the companies anticipate making the new solution available in the third quarter of 2021.

In their partnership announcement, the companies highlighted both the centrality of email as a communication channel for both personal and business use. Despite the rise of alternative forms of communications including text messaging, email is still embraced by 87% of all citizens in the U.K. Businesses can take advantage of the popularity of email, Signicat and Cryptshare assert, if they are willing to take the necessary steps to ensure both security and traceability. Today’s announcement integrates the two companies’ technologies so that Cryptshare’s services can be accessed using eIDAS-compliant secure authentication.

Founded in 2007 and headquartered in Trondheim, Norway, Signicat made its Finovate debut at FinovateEurope in 2017. At the event, the company demonstrated its rapid onboarding and digital signing solutions Signicat Assure and Signicat Sign. Acquired by Nordic Capital in the spring of 2019, the company has since appointed a new CEO in Asger Hattel, acquired Dutch identity verification specialist Connectis, collaborated with fellow Finovate alums like Mambu, and was named one of the fastest growing companies in Europe by The Financial Times.

“We live in a society where now more than ever we must ensure trust between businesses and consumers online,” Hattel said when the announcement in the FT was made. “In Signicat, we are building a progressive digital trust company that both embraces innovation and business needs in this area. We have a decade’s worth of experiencing building the tools, so we are ideally placed to address this growing market opportunity.”

Signicat partner Cryptshare is headquartered in Freiburg im Breisgau in Southern Germany. Founded in 2000, the company has four million users of its technology in 30 countries around the world, including 2,000 corporate customers. Dominik Lehr is CEO.

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Spiral Secures $14 Million for its Ethical Banking App

Spiral Secures $14 Million for its Ethical Banking App
By David Penn Posted on
Categories: Daily news, Funding

Digital banking services company Spiral picked up a $14 million investment this week. The New York-based company will use the capital to fund its new app that makes it easy for users to donate to the charity of their choice.

“The future belongs to socially-conscious brands that care as much about giving back to society as they do about generating profits and growth,” Spiral CEO and co-founder Shawn Melamed said. He explained that the company’s goal is to create a new solution to serve an ecosystem of millions of charitable givers and more than one million non-profit businesses.

“People are increasingly supporting brands that align with their values,” Spiral President and co-founder Dan Blumenfeld added. “And they expect a simple and effortless user experience. Spiral will offer customers both a personalized banking experience and a deeper connection to the charities they support.”

Currently in beta, Spiral boasts that it offers account holders 15x more than the national average in savings and cash bonuses. No minimum balance is required and no fees are charged for active accounts or for transferring money by ACH. Spiral provides donation matching of up to $150 per year to more than one million charities and nonprofits ranging from the David Ortiz Children’s Foundation to the Cerebral Palsy Research Alliance Foundation. Automatic donation reports for tax returns are provided, and the company’s deposit accounts are issued by nbkc Bank of Overland, Kansas, and are FDIC-insured up to $250,000.

The funding round was led by Team8 and featured participation from Communitas Capital, Phoenix, Nidoco AB, and MTVO. Melamed and Blumenfeld founded Spiral after Melamed served as Managing Director of Morgan Stanley’s Technology Business Development and Innovation Offices and Blumenfeld served as Head of Product and Growth at Skype.

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DriveWealth Forges Partnership with Plaid

DriveWealth Forges Partnership with Plaid
By David Penn Posted on
Categories: Alumni News, Daily news, DriveWealth, Plaid

It’s getting hard not to wonder if Plaid is better off as a bachelor …

Last week, we highlighted how the financial data connectivity platform rebounded from its failed union with Visa to launch a range of new initiatives including new offerings (new income verification solution Plaid Income), new partners, and a diversity-oriented accelerator program, FinRise.

Today brings news that Plaid has teamed up with global brokerage infrastructure platform – and fellow Finovate alum – DriveWealth. Courtesy of a single API integration, customers of both firms will be able to streamline and simplify the online investment account funding process for their clients.

“The combination of DriveWealth and Plaid to enable anyone from fintechs and banks to investment advisors and RIAs to quickly and securely add investment capabilities to their current offerings, via a simple API, will give more consumers equal access to investing in the U.S. markets,” DriveWealth CEO Bob Cortright said.

The integration will enable customers of both DriveWealth and Plaid to authenticate end user bank accounts using Plaid’s technology, and leverage tokenization to provide fast and secure verification of bank funding sources using DriveWealth’s API. The combination not only improves the ACH success rate, it also boosts transparency into the fund transfer process while safeguarding client data.

Plaid Head of Revenue Paul Williamson credited the wealth management industry for its advances in technology in recent years. But he pointed out that there is still more friction in the process than there needs to be. “Companies like DriveWealth are changing that and this partnership combines to power of Plaid with DriveWealth to make digital investing experiences even easier,” Williamson said.

In addition to this week’s partnership with DriveWealth, Plaid also announced that it is working with Dun & Bradstreet to bring the benefits of alternative data to small business credit risk analysis. The new integration will enable small business owners to safely share financial account information and potentially improve their credit profile with the commercial credit reporting agency.

“Small businesses need all the support they can get, and this integration makes the process of creating and building a business credit profile secure and simple, which can lead to better access to financing and more business opportunities,” Global Head of Policy at Plaid John Pitts said.

And by the way, Plaid is not the only fintech in today’s partnership announcement that is populating the headlines of late. DriveWealth began 2021 with the acquisition of institutional broker dealer Cuttone & Company. The deal will bring additional market and regulatory expertise to the Chatham, New Jersey-based brokerage infrastructure API provider – as well as a network of institutional trading partners.

More recently, DriveWealth teamed up with Aghaz to support the Seattle-based roboadvisor’s investment app for Muslim customers, partnered with cross-border roboadvisor Hemista to bring fractional share investing in both U.S. and Indian stocks to Indian ex-pats, and collaborated with GenZ-focused investment app Alinea.

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