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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Flinks, a startup based in Montreal, Quebec, Canada, that specializes in data aggregation for financial services, has secured $11 million in Series A funding. The investment was led by NAventures, the VC arm of National Bank of Canada, which also provided $5.2 million in debt financing. Also participating in the round were Intact Ventures, Luge Capital, and Panache Ventures.
Flinks CEO Yves-Gabriel Leboeuf called the investment “timely” adding that the company was “well on track” to meet the goals it has previously set and was now ready to “face new, bigger challenges.” In a Q&A announcement at the company blog, Lebouef explained that, having focused on retail banking up to this moment, the company will look to expand into what he referred to as “wealth data.”
“Flinks will enable connections to data sources in the wealth management space, through a new aggregation service,” Lebouef said. “This is something we’re going to pull off in the near future – in fact, we’re already well into the beta phase.”
Founded in 2016, Flinks helps businesses provide users with the financial services they want. The company’s technology enables companies to connect their customer’s bank accounts, and to leverage data insights to build better, more personalized financial products. Lebouef noted that “roughly 1 in 3 Canadians” have connected their bank accounts with his company, which has processed 300+ million connections.
The investment will help Flinks expand to new markets and take advantage of the opportunities of open banking. Managing Director, Venture Capital, NAventures Philippe Daoust said, “We see great alignment between Flinks’ mission and our own focus on helping our clients manage their finances by providing them with innovative and reliable digital solutions.”
Flinks, which signed its first client in the spring of 2017 and its 100th client a year later, began 2020 by adding Clayton Feick as its new Chief Revenue Officer. Feick is a veteran of Quandl and Thomson Reuters, where he was vice president and global head of sales and business development and global lead, respectively.
The second day of FinovateAsia Digital focused on a pair of themes – digital payments and futuretech – that are increasingly intertwined. Both offer solutions to the challenge of liberating consumers and communities from their “cash addiction” by combining industrial applications of the Internet of Things with the processes of the financial services industry. It is clear that the nexus of payments and advanced, enabling technologies is one of the key frontiers of fintech innovation today.
Below are a few insights and observations on these topics from our speakers on Day Two of our conference. And remember, to join our all-digital event – live or On Demand – visit our FinovateAsia Digital hub to register and begin enjoying all the content we have to offer.
On the persistence of cash, and the urgency to bring alternatives to communities that rely on cash
The newspapers are full of stories about how some communities are being left without ATMs, and people are finding it hard to access cash. You can see why that is because as the number of cash transactions falls, the cost of cash infrastructure – not just ATMs, but every shop with its tills and counting up cash and depositing it and vans full of cash driving around all over the place to fill up the ATMs, security guards – all of that infrastructure falls on fewer and fewer transactions, so the per transaction costs goes up.
So how to you protect people who need to work in cash? Well, (innovation in ATMs) seems to me to be an expensive way to do it. The alternative would be to find ways of moving them away from cash, not finding ever more expensive ways of allowing them to continue their cash habit. It’s the people who are trapped in a cash economy that face the highest transaction costs anyway.
–David Birch, Director of Innovation, Consult Hyperion
On the value of artificial intelligence to those business leaders who have implemented the technology
Thirty percent of the (business) leaders who have adopted and integrated artificial intelligence into their business models are very convinced that AI will deliver (on) their core strategic business decisions. So, in other words, 30% of those who have already deployed artificial intelligence believe that artificial intelligence must sit at the core of their deliverables in business strategy.
45% of these leaders invest three times more in this type of technology than the late adopters or the laggards. And 7% of the leaders record more revenues and savings than the late adopters of this technology. So as you can see, these numbers speak volumes. It’s also interesting to understand that these numbers compound over time. And the speed of compounding this growth and acceleration will be translated in a higher market share, better customer deliverables, and improved market reach in different jurisdictions. In other words: stronger business.
— Clara Durodié, Chief Executive, Cognitive Finance Group
On the enabling power of the Internet of Things and Industry 4.0 for payments and other financial services
Once we have the ability to connect devices and large industrial systems into financial services we suddenly have interesting opportunities, for example, in enabling real-time payments and machine-to-machine payments. So we are talking about creating a payment ecosystem and financing capabilities based on data streams and digital representations of physical assets in the industrial landscape.
This, of course, opens up a lot of questions. We need to think about, first and foremost, the trust model that has to be established. For example, when you create a digital representation of a physical asset, if we want to give that asset or a machine a payment capability where they are able to exchange value with other machines, we have to define a structure for a machine identity. You could almost argue that we need to establish a “Know Your Machine” process instead of a “Know Your Customer” process.
– Ville Sointu, Head of Emerging Technologies, Nordea Bank
Available both live (Singapore time) and On Demand during the conference week, FinovateAsia Digital is a unique opportunity for those interested in learning more about fintech in the Asia-Pacific region. Browse our all-digital presentations, interviews, and discussions; network with fellow attendees; and gain key insights into the trends driving fintech innovation in critical, emerging markets.Visit our FinovateAsia Digital Hub and register today.
U.S. challenger bank Point, which offers a consumer banking app and pledges to provide a “credit card experience” to debit cardholders, announced that it has raised $10.5 million in Series A funding. The round was led by Valar Ventures, and featured participation from Y Combinator, Kindred Ventures, Finventure Studio and “business angels.” Company CEO and co-founder Patrick Mrozowski said the challenger bank has raised a total of $12.7 million.
The San Francisco, California-based company has been in private beta “for the past year” plans to launch a major new version of its technology later this year, according to reporting in TechCrunch. In addition to its Point Card debit product – available as both a physical and virtual card – the company offers a Point Checking mobile savings account. The account is backed by FDIC-insured, Point partner Radius Bank, and the challenger bank leverages technology from Finovate alum Plaid in order to link accounts on its platform to a third-party bank account. Point does not charge foreign transaction fees for international transactions, and relies on Mastercard’s exchange rate for overseas transactions.
Users of the Point Card earn points when shopping with popular merchants including Airbnb, Uber, and Starbucks where cardholders can pick up 2x, 3x, and 4x in points respectively for each dollar they spend. Seamless integration between the Card and the app ensure a holistic consumer experience with features including purchase notifications, in-app card management, and rewards tracking.
Previous to his co-founding of Point, Mrozowski founded and ran Crumbs, a micro-investing platform for cryptocurrencies and digital assets that was acquired by Metal Pay two years ago.
How has COVID-19 affected fintechs in the Asia-Pacific region and their ability to grow and expand into new channels and new markets? Who is better positioned – fintechs or banks – when it comes to managing the global health pandemic? What role does the public sector play in supporting fintech innovation in the different countries of the region, and how has the coronavirus impacted those relationships?
In keynote addresses, fireside chats, and roundtables, our fintech experts and analysts began FinovateAsia Digital today with the topic that is most central to everyone fintech right now: what can the fintech industry do now to best prepare for the “New Normal” on the other side of COVID-19?
With a focus on startups and digital transformation, here are a few highlights from some of the day’s conversations from our first, all-digital, Finovate conference. To join us live – or to watch the program On Demand during the conference week – visit our FinovateAsia Digital Hub to register.
On forming partnerships and building relationships between startups and incumbents at a time of social distancing
For us the pre-dominant fact was that we had to move everything online for the very first time. We have always run our programs face-to-face. This is where we believe innovation and magic happens: when people are in the same room and brainstorm together. This has been a great challenge to show our corporates and our startups that this is possible online as well.
It does require a bit more structuring, so that has been keeping us busy as the incubator management team. It’s something we have been focusing on for quite some time: to identify what are the right tools that we are going to use that both engage the startups and the corporates. (Many startups) typically can access Zoom and all those tools. But our corporate partners on the other hand have a bit more of a challenge to bring their businesses online – or even to communicate online.
–Lisa Schroeder, Operations and Progamme Lead, F10
On crisis presenting opportunity for fintechs in Asia and how these companies rose to the challenge
If fintech every had a “moment” in its life, it is now, in this crisis. Because the whole fintech narrative has been: we can deal with situations, crises, far better than traditional, incumbent banks because we have technology, we can interact with the consumer more directly, we have algorithms which can understand risk better … Now we had a perfect storm to go and look at all possible stress scenarios and find a way to serve the consumer the best. So from a fintech standpoint, they had a perfect environment to go and succeed. And we saw very strong evidence of such in Asia.
If I look at the growth of e-payment services … if I look at the demand (from) people who are looking for lending from alternative platforms – it just went through the roof … There are other data points which strongly show that if you are a fintech and you have a mature product during the crisis, you tend to gain a lot. For example, the graph of fintech investment in Singapore from April, May, and June went up like a hockey stick. And the biggest beneficiaries of these investments are the fintechs which are serving the small and medium enterprise, and the fintechs that are helping banks digitize faster.
–Sopnendu Mohanty, Chief FinTech Officer, Monetary Authority of Singapore
On how the global health pandemic signals a shift in the pace of digital change in fintech
Traditional financial institutions are moving toward a collaborative, partnering, co-creation model, where they are partnering with the startup companies. And this partnership is a bit like a parent and a child. The parent, which is the financial firm, wants resilience, reliability, security, stability. The child wants to change the world, it wants challenge everything, it wants to kick down the walls and break down barriers and do everything differently because they want the world to change. And it is changing, because “the parent” is now having to work with “the child” in order to do things differently.
And that’s where this world of fintech today is really interesting because it’s not a simple one. It’s one where the mentor is the traditional financial firm who’s investing in the disruptor, which is the new startup technology firm. And the coronavirus pandemic has actually turbocharged (the) change, because traditional financial firms that were prevaricating and thinking about “maybe we should do more on digital” have been forced to suddenly overnight wake up and do digital.
–Chris Skinner, Author, theFinanser, and Doing Digital: Lessons from Leaders
Available both live (Singapore time) and On Demand during the conference week, FinovateAsia Digital is a unique opportunity for those interested in learning more about fintech in the Asia-Pacific region. Browse our all-digital presentations, interviews, and discussions; network with fellow attendees; and gain key insights into the trends driving fintech innovation in critical, emerging markets.Visit our FinovateAsia Digital Hub and register today.
Berlin, Germany-based “tech company with a banking license” solarisBank has secured $67 million in funding (€60 million). The Series C round was led by HV Holtzbrinck Ventures and Storm Ventures, and featured participation from a wide number of investors including BBVA, ABN Amro, SBI Group, Global Brain, Hegus, and Lakestar. Also participating in the oversubscribed round were Vulcan Capital and Samsung Catalyst Fund.
The investment takes the company’s total funding to more than $180 million (€160 million), and will be used to help fuel Solarisbank’s continued expansion throughout Europe. Since 2017, the company has doubled its revenues every year, and grown its product portfolio to include solutions like decoupled debit cards and post-purchase installment products. With more than 400,000 end-customer accounts as of the end of the first half of 2020, the company also announced that it will expand its operations in the cryptocurrency space via its subsidiary solaris Digital Assets.
“solarisBank is continuing its impressive growth and the current financing round will help us to expedite building a pan-European platform,” solarisBank CEO Dr. Roland Folz said in a statement. He added, “We are the leading platform for Banking-as-a-Service in Europe and are excited that this exceptional group of new investors will now be a part of our journey.”
At the same time, Deloitte Digital’s Middle East FinTech Study, released in June, cautioned that further fintech development in the region faces challenges with regard to financing, and a wariness from traditional banks toward engaging fintechs. The latter issue in particular reflects what the report authors – Rushdi Duqah and Anthony Yazitzis – call “a certain degree of contradiction and dichotomy.”
“Customer behavior across the Middle East, especially in KSA, is characterized by a willingness to adopt innovative solutions offered by banks,” Duqah and Yazitzis observed. The two highlighted P2P money transfers, account aggregation, and roboadvisory as three such areas. “However, banks are not leveraging the full suite of FinTech solutions/features to address customer’s needs and requirements to enhance the daily banking journey and experience,” they wrote.
Read the full report to see how “harmonization and trust” are the path forward for financial services companies, fintechs, and banks in the Middle East and Northern Africa.
What’s Next for Wirecard?
We reported on the crisis facing Germany’s Wirecard two weeks ago in Finovate Global. Company CEO Markus Braun stepped down amid reports that Wirecard could not account for $2.1 billion in cash, and concerns that the company was “the victim of fraud of considerable proportions.”
This week we learned that Braun has been arrested – though since released on bail – and that Deutsche Bank has engaged with the now-bankrupt company and is considering providing financial support. A report in Bloomberg noted that Deutsche Bank had conducted talks with Wirecard last spring (referred to as “preliminary discussions” that were quickly concluded) and that, despite its woes, Wirecard could be a potentially attractive acquisition target thanks to its partnerships with Visa, Mastercard, and JCB International.
Here is our weekly look at fintech around the world.
Sub-Saharan Africa
Billed as “the grand fintech consolidation,” TechCabal takes a look at MFS Africa’s purchase of SME digital payments provider Beyonic.
Nigerian fintech Wallets Africa locks in new funding from investors including Y Combinator CEO Michael Seibel.
The East African makes the case for Kenya as a top destination for venture capital in Africa.
Central and Eastern Europe
Top banking-as-a-service platform solarisBank raises $67 million (€ 60 million) in Series C funding.
Electronic payment network Paysera expands to Kosovo.
Azerbaijan’s Xalq Bank launchesCompass Plus’ open development platform, TranzAxis.
Middle East and Northern Africa
Digital property management and rent collection platform Ajar earnsUAE’s Most Trusted Fintech in 2020 honors from APAC Business Headlines.
UAE’s central bank and the Abu Dhabi Global Market (ADGM) announce the start of their annual Fintech Abu Dhabi Innovation Challenge for fintechs developing solutions for local small businesses.
Dubai’s Mamo Pay earns spot in Visa’s Finech Fast Track Program.
Central and Southern Asia
Transfast, a U.S.-based cross-border payments company, partners with Pakistan’s Habib Bank to enable money transfers to Pakistan.
Bangalore, India-based fintech Zeta announces expansion into Vietnam and the Philippines.
Indian gold lending startup, Rupeek, unveils zero contact gold loan kiosks to support touchless financing amid the coronavirus pandemic.
Latin America and the Caribbean
Mexican fintech ePesos announces $21 million debt financing round with Accial Capital.
BizCapital, a lending startup based in Brazil, raises $12 million in funding thanks to an investment from Germany development finance institution, DEG.
Credit Suisse buys 35% of Brazilian digital bank modalmais.
Asia-Pacific
Myanmar Citizens Bank (MCB Bank) issues MPU-JCB co-branded debit cards.
Razer’s fintech arm, Razer Fintech launches new initiative to support local businesses in Malaysia during the global health care crisis of COVID-19.
KrASIA profiles Indonesian fintech Akulaku, which offers online credit, wealth management, and digital banking services in the Philippines, Vietnam, and Malaysia.
Today is Canada Day, which commemorates the date in 1867 when three provinces – Nova Scotia, New Brunswick, and the Canada Province (now known as Ontario and Quebec) – united to form a single nation. And while the global public health crisis may limit the holiday’s typical parades, cook-outs, fireworks demonstrations, and concerts, rest assured that Canadians all over the world will find a way to celebrate what is colloquially – if a bit inaccurately – referred to as “Canada’s birthday.”
With this in mind, the Finovate blog sends a hearty “Happy Canada Day!” to the dozens of Canadian fintechs that have demonstrated their innovative solutions at our conferences over the past decade-plus.
A pair of Finovate alums have joined forces to help a leading financial platform in Asia launch a lending solution as part of its planned expansion in the region.
German cloud banking platform provider Mambu and alternative credit score provider CredoLab have announced a partnership with GoBear, a financial services platform based in Singapore. The company, founded in 2015 as a metasearch engine and now operating as a financial services platform that has served more than 55 million consumers, plans to expand into the Philippines later this year. Technology from Mambu will power the core system in GoBear’s lending architecture, with CredoLab’s credit scoring helping ensure the company is able to bring financing to those communities that need it most – and often struggle to secure it.
“Having access to responsible credit should be a financial right for all,” GoBear Chief Lending Officer Mike Singh said. “Tapping into fintech solutions like Mambu’s and CredoLab’s brings us one step closer to making this a reality for the region’s 296 million unbanked or underbanked.”
The tripartite partnership was the result of a pair of relationships; Mambu and CredoLab have been long-time partners, while CredoLab and GoBear collaborated as recently as November 2018, when the two companies worked together on a credit solution for the underbanked.
“In less than five years of operation, GoBear has built a stellar reputation as a leading financial services platform and we envisage great things for the company as it continues to build its lending business,” Mambu Managing Director for APAC Myles Bertrand said. He pointed out that the company’s technology would enable GoBear to readily add new products while maintaining a high level of customer service.
CredoLab CEO Peter Barcak pointed to his company’s SDK, API, and alternative credit score – which leverages metadata from smartphone usage – as powerful tools for companies like GoBear that are trying to serve a broader array of customers. “Our ability to generate a credit score for customers who cannot prove their creditworthiness in the conventional financial system makes us uniquely positioned to support GoBear as they diversify their business and move into lending in a controlled way.”
Finovate alums since 2013 and 2018 respectively, both Mambu and CredoLab made their Finovate debuts at FinovateAsia events. Mambu demonstrated its technology the year we held our Asian conference in Singapore. CredoLab unveiled its CredoScore the year we held FinovateAsia in Hong Kong.
Speaking of FinovateAsia, remember that our new, all-digital FinovateAsia conference begins next week. Check out our FinovateAsia hub for more details!
Predictive analytics innovator Stratyfy is one of ten companies selected to participate in the incoming cohort of FIS’ 2020 Fintech Accelerator program.
“The ten companies selected for the fifth year of FIS’ Accelerator program bring a wealth of promising ideas and technologies,” FIS Chief Growth Officer Asif Ramji said. “We look forward to working with these firms to bring their ideas to life.”
Joining Stratyfy in the program are:
Cirrus Secure
Cobbler Technologies
Dasceq
Mall IQ
Sequretek
Silot
Surfly
TrustStamp
XpenseOne
Seven of the companies in the cohort have headquarters in the United States. Of the others, Sequretek is based in Mumbai, India; Silot in Singapore; and Surfly in Amsterdam, The Netherlands. And after four years in operation, the accelerator, in partnership with The Venture Center, will conduct its fifth program virtually due to the challenges of the global public health crisis.
In addition to being entirely virtual, this year’s program will run for 18 weeks instead of the usual 12 weeks to allow for increased mentoring and training time. The program will culminate with a Demo Day technology presentation on October 14th. Participating startups will also receive a monetary investment; the amount was not disclosed.
Executive Director for The Venture Center, Wayne Miller, pointed to the program’s success in empowering startup companies and helping improve access to financial services and technology. “With our partners at FIS and the State of Arkansas, we’re honored to be a part of bringing cutting-edge technologies to the places and people who need them, particularly in this moment of monumental technological advancement,” Miller said.
The news comes in the wake of Strayfy’s announcement of a new strategic partnership with Innovesta Technologies. The two companies are collaborating on a machine learning solution that will help businesses better measure the risk of and opportunity in non-public companies. The partnership combines Stratyfy’s decision engine and advanced machine learning technology with Innovesta’s comprehensive data assets to deliver real-time insights into the forces that impact business performance.
“Models built from historical data offer little help during an unprecedented health and economic crisis like the current global pandemic,” Stratyfy co-founder and CEO Laura Kornhauser said when the partnership was announced in May. “Achieving an inclusive global financial recovery requires robust risk management strategies, and those strategies necessitate an understanding of the unique challenges being faced by every business. Stratyfy’s decision management solutions will leverage Innovesta’s trustworthy data to directly address this need.”
Founded in 2016, Stratyfy is headquartered in New York City. The company was named one of the world’s 100 most promising startups to watch last year by CNBC.
Finovate alums raised more than $975 million in equity funding in the second quarter of 2020. The sum represents investments received by 15 companies that have demonstrated their technologies at our conferences, and includes three fundings in which the amount of the investment was not disclosed.
This year’s total is a retreat from the past two years’ totals, both in terms of amount raised and the number of alums reporting equity funding. In some respects, Q2 2020’s fundraising total “fills the gap” from the big jump in funding from Q2 2017 to Q2 2018.
Previous Quarterly Comparisons
Q2 2019: More than $1.8 billion raised by 29 alums
Q2 2018: More than $1.5 billion raised by 25 alums
Q2 2017: More than $726 million raised by 25 alums
Q2 2016: More than $510 million raised by 23 alums
While total investment for Q2 2020 was lower than it was in the previous year’s Q2s, it is notable that seven of the top ten fundings were investments between $150 million and $100 million. In many instances, one sizable investment will be responsible for a significant amount of a quarter’s investment total. Consider the boost Sofi’s $500 million funding provided in Q2 2019. The large sum sent that quarter’s total soaring to a new record Q2 high. By comparison, this year’s high number of low, nine-figure fundings comes across as a welcome shift in the distribution of VC wealth.
Top Ten Equity Investments for Q2 2020
EVO Payments: $150 million
Marqeta: $150 million
BioCatch: $145 million
AvidXchange: $128 million
Stash: $112 million
Onfido: $100 million
Payfone: $100 million
Featurespace: $37.4 million
M1 Finance: $33 million
Meniga: $9.4 million
It must be noted that, while venture capital investment has slowed somewhat in response to the COVID-19 crisis, merger and acquisition activity has been robust, relatively speaking. Among our alums alone, Q2 saw two major fintech acquisitions: Mastercard’spurchase of Finicity – valued as high as 1 $billion – and Personal Capital’s just-announced $825 million acquisition by Empower Retirement.
Here is our detailed alum funding report for Q2 2020.
April 2020: More than $638 million raised by six alums
If you are a Finovate alum that raised money in the second quarter of 2020, and do not see your company listed, please drop us a note at research@finovate.com. We would love to share the good news! Funding received prior to becoming an alum not included.
McLean, Virginia-based digital identity network ID.me has boosted its total equity capital to more than $39 million after locking in an investment of $8.3 million this week. The new funding comes from a $12.5 million equity offering from the company, which featured the participation of 32 different investors.
ID.me has not provided any commentary on the investment, nor disclosed plans for how it will use the additional capital. The company’s previous fundraising was a $19 million Series B round in March 2017, according to Crunchbase.
The global public health crisis has put a spotlight on digital identity companies like ID.me. In March, the company announced the launch of a real-time collaboration workspace on messaging platform, Slack, to help health care providers share information about the coronavirus. In April, ID.me teamed up with DrFirst to make it easier for health care workers to verify their identities when using DrFirst’s mobile e-prescribing app, iPrescribe.
And in May, ID.me partnered with Shoes.com, enabling the company to accurately verify frontline healthcare workers as part of its program to provide them with discounts on footwear.
“As the U.S. enters its third month battling COVID-19, first responders and healthcare workers continue to soldier tremendous burdens and personal risks as they fight day-to-day on the frontlines of the pandemic,” ID.me founder and CEO Blake Hall said. “We are honored to play a role in the Step Up program and proudly support Shoes.com’s efforts to recognize these national heroes.”
A Finovate alum since 2014, ID.me most recently demonstrated its identity verification gateway at FinovateSpring in 2017. The company’s identity verification services – ranging from multi-factor authentication, document verification, and compliance monitoring, in addition to its identity gateway – are used by a wide variety of well-known organizations and institutions including USAA, NASA, Under Armor, and the United States Department of Treasury.
ID.me notes that it onboards 60,000 new users a day and has a total of 24 million users of its technology. Earlier this month, the company announced another partnership, this time working with LensDirect as part of their We See You, Heroes initiative to provide frontline health care workers and first responders with discounts on vision care products.
U.K.-based peer-to-peer lender Zopaannounced this week that it has been awarded a full U.K. banking license and will move forward with its plans to launch a digital bank.
The bank will offer the Zopa Fixed Term Savings Account, which features FSCS protection up to £85,000. Zopa plans to introduce a credit card later this year.
“Now more than ever the banking industry needs innovative, agile providers who work on behalf of customers,” Zopa CEO Jaidev Janardana said. “At a time when people want great value, fair financial services products, and simple, intuitive digital experience(s), Zopa offers consumers a compelling and credible alternative they can trust.”
Founded in 2005, and one of Finovate’s earliest alums, Zopa raised $182 million last December in preparation for bank launch announced this week. The company has secured a total of more than $464 million in funding since inception.
Village Capital is out with its State of Financial Health Startups report which looks at the areas of innovation with the “greatest potential to improve the wellbeing and inclusion of marginalized communities in MENA.”
The State of Financial Health Startups in MENA acknowledges the attention paid to areas of fintech such as digital payments and e-commerce. At the same time, the goal of the report is to focus on those ways that fintech can solve specific problems in the region, specifically the challenge of inequality.
The report highlighted six fields of fintech innovation that are mostly likely to meet this challenge, as well as 12 startups that are active in these areas. The fields were:
saving and wealth-building technology
employment tech
digital ID
financial literacy services
access to capital
alternative lending
The twelve featured startups were:
Rumman (Palestine)
SmartCrowd (UAE)
Kader (Jordan)
Khtwteen (Egypt)
Hawiyati (Jordan)
Valify Solutions (Egypt)
Finllect (UAE)
Merakido (Egypt)
Fawaterak (Egypt)
Fundbot (Lebanon)
Ciwa (Morocco)
Solfeh (Jordan)
The Catalyst Fund, supported by BFA Global, UK aid, JP Morgan Chase and Rockefeller Philanthropy Advisors, has announced its latest fintech cohort.
The Fund has accelerated 31 portfolio companies that have raised collectively more than $64 million in follow-on fundraising since inception. The Fund awards each of its portfolio companies $100,000 in grant capital, as well as venture-building support for six months, and one-on-one networking with investors and corporate leaders to help them scale their businesses. Of the companies making the cut were a number of fintechs including:
FlexFinance (Nigeria)
Paymenow (South Africa)
Mango Life (Mexico)
Graviti (Mexico)
KarmaLife (India)
“We believe we are facing a catalytic moment during which there is an opportunity to use technology to help low-income consumers and small businesses recover from the impact of COVID-19 and build greater financial resilience for the future,” Catalyst fund director Maelis Carraro said.
Here is our weekly look at fintech around the world.
Asia-Pacific
Malaysian recurring payments platform Curlec announces funding from 500 Startups.
Thai cashless solution provider for businesses SYNQA raises $80 million in Series C investment.
TechWireAsia looks at the impact of COVID-19 on Indonesia’s emerging fintech industry.
Sub-Saharan Africa
Nigerian fintech KiaKia goes live with its app that enables users to invest in the funding of secured personal and business loans.
Centbee, a fintech based in South Africa, adds the ability to purchase prepaid electricity, airtime, and data via a new feature on its BitcoinSF wallet.
GhanaWeb features Ghanaian cross-border, money transfer company FXKudi.
Central and Eastern Europe
Edenred, a French prepaid corporate services provider, launches Apple Pay mobile payments for digital meal vouchers in Romania.
Lithuania-based identity verification firm iDenfy partners with U.K. online banking platform Cashaa to help cryptocurrency investors in India avoid fraud.
Austria gains a new insurtech competitor as Hong Kong-based bolttech partners with local telcom Drei to bring the first non-insurance switch program to the country.
Middle East and Northern Africa
Egypt-based fintech MoneyFellows raises $4 million in Series A funding.
Global tech ecosystem, Hub71, teams up with Mashreq Bank and First Abu Dhabi Bank to help startups open bank accounts in the UAE.
Commercial Bank of Dubai and cross-border payment provider Thunes announce partnership, enhancing CBD’s ability to operate in countries such as India, the Philippines, Pakistan, and Bangladesh.
Central and Southern Asia
India-Based Slice raises $6 million for digital payments.
BharatPe, a QR code-based, merchant payments company based in India, enters the point of sale business with the launch of its Bharat Swipe PoS solution.
Alphabet’s growth equity arm, CapitalG, invests $28 million in India-based SME lender Aye Finance.
Latin America and the Caribbean
BBVA announces that its mobile banking platform GloMo will support Apple Watch users in Uruguay.
Mexican bank Banorte and on-demand delivery firm Rappi partner to launch a financial services company in Mexico.
Central Bank of Brazil suspends WhatsApp payments in the country, citing competitiveness concerns.
If digital transformation is sweeping financial services – and this trend has been accelerated by the global public health crisis, as we are often told – then what’s up with the huge and enduring demand for cash?
“I certainly would have expected, if you’d asked me prior to COVID: would COVID put a big dent in cash? I would have said “absolutely” because not only are people not going out, it has a dirty connotation to it,” Fiserv Senior Vice President David Keenan said during the Q&A portion of his recent webinar presentation, Looking Under the Hood of Today’s Payments Ecosystem.
“And yet if you look at the data,” he added, “that’s not what’s happening.”
This was one of many fascinating takeaways from Keenan’s research on payment trends in the COVID-19 era. That research was presented this week in a webinar that also looked at the rise of digital enablement in financial services and the inevitable transition to real-time payments. Keenan’s presentation is now available for viewing on an on-demand basis.
Toward the end of his discussion, which explained how and why companies need to be able to provide “the right options at the right time to create a winning payment experience,” we asked the Fiserv SVP why he began his presentation, which featured insights on digital enablement and real-time payments, with a discussion on the importance and endurance of cash.
Keenan said the decision to start with cash was deliberate – and given the program’s theme of “safe, fast, convenient payments” it is perhaps easy to understand why. For all of cash’s drawbacks – including the fact that paper money increasingly is seen as “dirty” in an ever-more touchless world – Keenan showed research from the Federal Reserve indicating that cash remains a preferred payment method in the U.S. – only trailing debit. Moreover, for about 85% of those surveyed, cash usage over the past 12 months had remained the same, or increased.
But perhaps most interestingly, this data also revealed that cash’s most passionate champions are under the age of 25. And this preference for paper money does not take away from GenZ’s appreciation of debit, which is on par with 25-to-34 year old, 35-to-44 year old, and 45-to-54 year old cohorts. Nor was credit usage impacted by GenZ’s preference for cash; GenZ credit usage was comparable with both 25-to-34 year old and 35-to-44 year old age groups. The main difference between GenZ and other cohorts was in the use of electronic payments, where its usage was typically half that of other groups surveyed.
A further note on the enduring preference for cash: while cash usage patterns have returned to trend after a brief, coronavirus-induced drop in March, the amounts of cash being used – which began increasing in March – have remained elevated.
Keenan speculated that what might blunt these accelerating cash trends could be a major response to the coronavirus – such as a vaccine. He said, “as long as we’re living in this one-step-at-a-time, back-to-the-new-normal, we believe cash is going to be an important part (of payments).”
