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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Membership-based financial institutions such as credit unions play a critical role in helping promote financial engagement among those living and working in the communities they serve. This puts them in an ideal place to help promote the cause of financial inclusion, and the challenge of bringing financial services – and technological innovation – to underserved communities.
I spoke with Ben Maxim, Chief Digital Strategy & Innovation Officer at MSU Federal Credit Union at FinovateSpring earlier this year. Among the topics we discussed were:
Key business and tech trends to pay attention to
How to reach and connect with underserved communities
The role of decentralized finance in making financial services more accessible
Maxim provided insights into what underserved communities are looking for in financial services. He also discussed why financial inclusion is about more than breaking down socioeconomic barriers. Check out the full interview below.
Vehicle payment platform Car IQ partnered with Visa to power its in-vehicle merchant payments solution, Car IQ Pay Vehicle Wallet.
The partnership will enable wallet users to pay for fuel, tools, parking, insurance, service, and repairs without requiring a physical card.
Analysts expect the connected vehicle market to reach $600 billion by 2030.
Payment platform for vehicles, Car IQ, has partnered with Visa. The San Francisco-based company is working with the payments and credit card giant to power its in-vehicle merchant payments solution, Car IQ Pay Vehicle Wallet. The partnership will enable vehicles to transact directly with Visa’s global merchant and bank network. The Car IQ Pay Vehicle Wallet can then be used to pay for fuel, tools, parking, insurance, service, EV charging, and repairs.
“Our collaboration with Visa allows us to accelerate the adoption of vehicle payments and make them a seamless part of the fleet experience today, and the consumer experience of the future,” Car IQ CEO Sterling Pratz said. “Our vehicle wallet allows banks and merchants to trust payments from vehicles as well as any other IoT device, over the Visa network.”
The addition of vehicle data is a key component of the partnership. This data supports new contextual payment experiences including real-time offers and personalized rewards for drivers, merchants, or even entire fleets. Car IQ’s Know Your Machine technology authenticates a machine’s identity in order to enable vehicles of all types to transact directly with merchants.
A recent study from Ptolemus Consulting Group noted that the connected vehicle payment market could reach $600 billion by 2030. In a statement, Veronica Fernandez, North American Head of Visa Business Solutions, added that the total spend for commercial fleet payments is more than $80 billion. This sum includes cash, checks, ACH, as well as traditional fleet car payments. Fernandez said that the collaboration with Car IQ will help “drive growth of vehicle-based payments that allow users to take control of their fleet business through enhanced and timely data capabilities that allow for real-time business decisions.”
Car IQ is also partnering with automobile OEMs to embed payments within consumer vehicles. The company’s Car IQ Pay in-dash vehicle wallet, for example, connects to merchants on Visa’s network, enabling payments directly from the car’s infotainment system. Pratz noted that while its efforts are focused on vehicles, there’s more to the Car IQ platform than making payments from cars. “Our platform is designed to easily support any IoT device payment, and we are already seeing interest for connected ‘smart’ city applications and believe the connected home will be next,” Pratz said.
More than 25,000 fuel stations in the U.S accept the company’s Car IQ Pay solution. In June, Car IQ announced a partnership with PDI Technologies to process commercial fleet transactions. In March, the company worked with the United States Auto Club (USAC) to sponsor the “The Fab Four” racing competition for female drivers.
Founded in 2017, Car IQ has raised $42 million in funding, according to Crunchbase. In February, the company secured $15 million in an oversubscribed Series B round. Car IQ began the year teaming up with BlackBerry IVY to launch its in-dash vehicle wallet.
Big data and AI company SESAMm announced the integration of Generative AI into its platform.
The integration will enable SESAMm to offer enhanced ESG risk mitigation.
Founded in 2014, and headquartered in Paris, France, SESAMm won Best of Show in its Finovate debut in 2022.
SESAMm, an AI company that provides investment firms with critical insights on ESG, risk controversies, and other significant events, has integrated Generative AI into its platform. The addition is designed to help financial institutions apply enhanced ESG risk mitigation. The integration also will enable the company to streamline the process with automated tools and other enabling technologies.
“With Generative AI, we are not only enhancing our internal processes but also focusing on the development of new features that redefine industry standards,” SESAMm co-founder and CEO Sylvain Forté explained. “These include intuitive dashboards, automated ESG/SDG event analysis tools, and a client interaction chatbot – all created to streamline data interaction and boost efficiency in risk management.”
SESAMm’s technology enables users to derive insights from web data on millions of companies in less than a minute. The company’s platform enables users to generate transparent, real-time ESG and SDG insights on portfolio companies, suppliers, as well as their own organization. Risk alerts and monitoring keep users abreast of potential controversies, and users can leverage the technology to build thematic strategies for ETFs and other index-related initiatives. SESAMm offers data from 20 billion articles and four million public and premium sources on five million public and private companies. More than 100+ languages are covered, as well.
This week’s announcement means quicker and more intuitive interaction with data on SESAMm’s platform. New functionality includes ESG/SDG event summarization and automatic competitor searches for both public and private companies. SESAMm announced that is will launch a suite of Generative AI-powered features in the second half of 2023. SESAMm’s Forté will host an online fireside chat on Generative AI and the Future of Finance later this month.
Founded in 2014, SESAMm won Best of Show in its Finovate debut at FinovateEurope in 2022. At the conference, the Paris, France-based company demoed its TextReveal solution. TextReveal is an alternative data platform that leverages NLP (Natural Language Processing) to provide daily sentiment and ESG data on public and private companies.
In May, SESAMm announced a partnership with Compass Financial Technologies. The two companies are collaborating to leverage web sentiment data to build a new cryptocurrency-based thematic index. In March, SESAMm closed a Series B2 round in March, securing $37 million. The investment took the firm’s total equity capital raised to more than $65 million (€50.5 million), according to Crunchbase. SESAMm counts Elaia, Opera Tech Ventures, and NewAlpha Asset Management among its investors.
A partnership between credit and risk decisions company Stratyfy and Beneficial State Foundation is designed to combat ethnic and racial disparities in lending. The partnership was formed under the auspices of the Foundation’s Underwriting for Racial Justice (URJ) program. URJ consists of a team of financial institutions and “equity champions” tasked with identifying ways to improve access to credit for underserved communities and individuals.
The partnership has kicked off a two-year pilot program that will resource capital for people of color with the goal of stimulating wealth-building in their communities. To this end, 20 lenders will use Stratyfy’s technology, including its credit risk and decision optimization solutions, to remove bias from the credit decisioning process and encourage the fairest possible outcomes. Beneficial State Foundation Executive Director and Chief Impact Officer Erin Kilmer Neel called Stratyfy a “key partner” in the effort. Stratyfy co-founder and CEO Laura Kornhauser praised the institutions who are supporting the initiative.
“The innovative lenders selected for the URJ program are redefining how people of color in their communities are able to access credit,” Kornhauser said. “And Stratyfy is the technology chosen to deliver the collective insights and recommended actions to make it happen.”
The selected lenders are:
Beneficial State Bank
Berkshire Bank
BetterFi
Chehalis Tribal Loan Fund
Community Vision
Eastern Bank
Enterprise Community Loan Fund (ECLF)
Leech Lake Financial Services
LISC
Montecito Bank & Trust
NBT Bank, N.A.
New Orleans Fireman’s Federal Credit Union
REDF Impact Investing Fund
Rivermark Community Credit Union
Texas National Bank
Twin Cities Habitat for Humanity Lending, Inc.
Urban Redevelopment Authority
Vermont Community Loan Fund
Working Solutions CDFI
Washington State Employees Credit Union
Leaders from both the Vermont Community Loan Fund and NBT Bank underscored the opportunity to work together on behalf of greater financial inclusion. “Our team looks forward to collaborating with the 20-lender cohort to enhance our individual and collective impact on racial equity in lending,” NBT EVP and Consumer Lending Executive Shauna M. Hyle said. Forbes named NBT Bank to its World’s Best Banks roster this year, making NBT Bank the highest rated bank in the state.
Founded in 2017, Stratyfy made its Finovate debut in 2018. The company won Best of Show in its return to the Finovate stage last September at FinovateFall. At the conference, the company demoed its UnBias solution. Unbias enables financial institutions and fintechs to uncover and undo bias in complex financial decisions. The API-delivered technology is one of many transparent, machine learning tools Stratyfy offers to help companies minimize bias and improve risk-adjusted returns.
New York-based Stratyfy raised more than $10 million in funding this spring. Truist Ventures and Zeal Capital Partners co-led the round.
Financial mentorship platform for women, Penny Finance, has launched a new automated account integration.
The new offering comes courtesy of a partnership with financial data connectivity innovator Plaid.
Wall Street veteran Crissi Cole founded Penny Finance in 2020.
Penny Finance has added a new feature courtesy of the company’s partnership with Plaid. The financial mentorship platform for women announced the launch of a new automated account integration that will power enhanced money insights for its members. After linking their bank accounts to the Penny Finance platform, members will receive personalized, financial wellness reminders via email. Members will also get a customized version of Penny Finance’s education and mentorship guidance. This includes everything from helping members understand the differences between their various accounts, to strategies to maximize their financial opportunities. An example of the latter could be a suggestion to transition from a standard savings account to a high yield savings account.
“Managing your finances should be easy. You shouldn’t have to dig through statements, read a finance book, or ask your dad how to manage your money,” Penny Finance CEO and founder Crissi Cole said. “We are so excited to take the guesswork out of managing your money for the most high-potential group of investors out there: women.”
Cole founded Penny Finance in 2020. The company is the first personalized, tech-powered financial mentorship platform to offer real-world advice to women who lack access to a financial advisor. Earlier this year, the company earned a spot in the 2023 Techstars Future of Longevity startup accelerator in partnership with Pivotal Ventures. Penny Finance is among ten startups participating in the program.
Penny Finance began the year with the launch of an all-in-one community feature. The offering provides a welcoming space for women to come together and share advice on a variety of financial wellness topics. The Penny Finance team moderates the new feature, which hosts questions on everything from debt management to investing.
“Women are whip-smart,” Cole said when the community feature was introduced in January. “We are more educated, live longer, and yet, we typically retire with one-third of the wealth of a man. Why? The system wasn’t built for us. The world of finance is a ‘boys club’ with its own rules. But, the good news is, it’s not as complicated as they made it out to be.”
Plaid has been a Finovate alum for nearly a decade. The company introduced itself to Finovate audiences as part of our developers conference, FinDEVr SiliconValley, in 2014. In the years since, the financial data connectivity innovator has grown into a leading fintech that powers more than 7,000 apps and services with its API-first network. The company also facilitates connections to more than 12,000 financial institutions. Headquartered in San Francisco, California, Plaid was founded in 2013. Zach Perret is CEO.
Open data company Moneyhub announced a pair of partnerships at the beginning of the month.
The Bristol-based firm forged a referral partnership with fellow Finovate alum MX.
Moneyhub is also working with wealth management solutions provider Voyant, leveraging open data to accelerate the fact-finding process for financial advisors.
U.K.-based open data company Moneyhub announced a number of partnerships in recent days and weeks. At the beginning of the month, the fintech forged a strategic partnership with Utah-based open finance innovator MX. Via the partnership, Moneyhub will be able to refer customers to MX for support in North America, while MX will be able to refer customers who are looking for open finance solutions in European markets to Moneyhub.
Moneyhub provides consumers with data to enhance their financial health. The firm’s technology also helps businesses gain the kind of insights that enable them to deliver personalized solutions to their customers. In addition to Moneyhub’s Personal Finance Management platform and Open Banking APIs, the company offers decisioning tools that provide data-powered affordability checks that provide a real-time view of applicant financial information.
MX’s connectivity solutions and open finance APIs enable both consumers and businesses to leverage financial data to improve outcomes. MX provides reliable connections and data verification to help firms make insightful, actionable decisions, provide superior money experiences for customers, and grow their businesses.
“MX and Moneyhub share the belief that consumer-permissioned data sharing is critical to the future of our industry and we have an inherent responsibility to improve the money experience for consumers,” Raymond den Hond, Chief Commercial Officer, Partners at MX, said in a statement. “It will allow our clients to use consent-driven data to improve their customers’ financial lives, on a global scale,” Moneyhub CEO Samantha Seaton said.
A seven-time Best of Show winner, MX most recently demoed its technology on the Finovate stage in 2021 for FinovateFall. The fintech has more than 13,000 connections with financial institutions and fintechs, giving the firm a combined reach of more than 200 million consumers. Founded in 2010 by Ryan Caldwell and Brandon Dewitt, MX is headquartered in Lehi, Utah. Jim Magats is CEO.
In addition to its strategic partnership with MX, Moneyhub also announced last week that it has teamed up with financial planning and wealth management solutions provider Voyant. The Austin, Texas-based company will put Moneyhub’s Open Banking and Open Finance APIs to work giving advisors instant access to their clients’ financial information, including assets and analysis of income and expenditures in real-time. The data-sharing technology is secure, GDPR-compliant, and accelerates the fact-finding process for financial advisors.
Voyant’s technology analyzes real-time client data from a wide variety of sources. These include bank accounts, credit cards, investments and pensions, as well as loans and mortgages. The analysis of this broad range of data ensures more accurate, automatic modeling. It also supports advisors Consumer Duty requirements that mandate that financial products be focused on client goals by providing more personalized, tailored financial solutions.
Voyant was founded in 2008. Today the company serves more than 20,000 financial professionals and more than 40,000 of their clients. The digital wealth solution provider includes Lloyds Bank, CIBC, and BMO Bank of Montreal among its wealth management partners.
“Consent-driven, comprehensive and real-time access to financial data is critical for advisors to support their clients in achieving their long-term aspirations,” Kim Jenkins, Managing Director of Moneyhub, API explained. “Only with this information can they advise on the right products and solutions, at the right time, to deliver on those goals.”
A Finovate alum since 2015, Moneyhub offers solutions for a range of companies in financial services – from banks and building societies to wealth managers, insurers, and lenders. The Bristol-based fintech offers seamless, single source connectivity to thousands of financial institutions in 37 countries to help businesses better understand and serve their customers.
In June, Moneyhub partnered with pension management firm Standard Life to power the company’s MoneyMindset solution. MoneyMindset gives Standard Life’s 1.5 million workplace pension scheme members real-time access to their spending and savings data across financial products. The previous month, Moneyhub announced that it had become the first third-party provider (TPP) to connect to Chase Bank in the U.K.
In some of the biggest news in international fintech of late, credit card leader Visa announced that it is acquiring Pismo, a Brazilian payments infrastructure company. Visa is paying $1 billion in cash for the firm, making the transaction one of the largest of its kind in the fintech industry this year.
“At Pismo, we aim to enable our clients to launch cutting-edge payments and banking products within a single cloud-native platform, regardless of rails, geography or currency,” Pismo CEO and co-founder Ricardo Josua said. “Visa provides us unrivaled support to expand our footprint globally and help shape a new era of banking and payments.”
The acquisition is subject to regulatory approvals and standard closing conditions. The transaction is expected to be completed by the end of this year. Pismo will retain its current management team, post-acquisition. The company also insists that it will remain both rail and network agnostic, and that it will continue to offer all of its current products including banking, cards, and loans.
The deal will enable Visa to offer core banking and issuer processing capabilities across debit, prepaid, credit, and commercial cards for clients through cloud native APIs. Access to Pismo’s platform will also give Visa the ability to offer both support and connectivity for a variety of emerging payment rails – such as Brazil’s instant payments platform, Pix – for its financial institution clients.
Founded in 2016, the São Paulo–based fintech processes nearly 50 billion API calls a year and $40 billion in transaction volumes. The company powers more than 40 million issued cards and nearly 80 million accounts. In addition to serving customers throughout Latin America, Pismo is active in the U.S., Europe, India, Southeast Asia, and Australia. The fintech’s customers include banks and financial services firms like Brazil’s Itaú and Citi, as well as fintechs such as Revolut, N26, and Nubank.
The merger between Brazilian alternative lender Open Co and SME working capital provider BizCapital may not have produced as much fanfare as Visa’s acquisition of Pismo. But the combination is a boon for small businesses in Brazil, which will benefit from a new player in the B2B space with $104 million (R$ 5 billion) in unsecured credit operations for both individuals and small firms.
Interestingly, the merger was accomplished without the participation of financial capital and instead involved an exchange of stakes. Open Co CEO Sandro Reiss noted that the fact that the two companies have never been in direct competition, their “courtship had been going on for some time now.”
Open Co was launched in 2021, the product of a merger between online lender Geru and Rebel, a company that leveraged AI and bank account data to asses customer risk and financial health. BizCapital was founded in 2016 as a lender to SMEs that struggled to access funding via the country’s larger banks. Open Co serves approximately 10 million individuals; BizCapital serves more than one million small businesses.
Here is our look at fintech innovation around the world.
Latin America and the Caribbean
Chilean fintech Shinkansen raised $3 million to support international expansion.
Mexico’s BanCoppel announced a partnership with Temenos to modernized its core banking technology.
Forbes looked at the rise of Brazilian fintech Nubank.
Fintech giant FIS announced that it will sell a majority stake in Worldpay to private equity firm GTCR.
The move comes just over four years after FIS acquired Worldpay in a deal valued at $43 billion.
The transaction is the largest to date for GTCR and the biggest leveraged buyout of 2023.
Four years after acquiring payments company Worldpay, fintech titan FIS has announced plans to sell a majority stake in the firm. Private equity company GTCR is the purchaser, and will gain 55% of Worldpay, which is currently valued at $18.5 billion. Note that when FIS acquired the company in 2019, Worldpay was valued at $43 billion.
The sale is expected to close by the first quarter of 2023. Former Worldpay CEO Charles Drucker will be re-appointed as Chief Executive.
The transaction is the largest to date for the PE firm. The deal is also the largest leveraged buyout of the year. GTCR will finance half of the transaction with equity financing and the other half via borrowed capital. GTCR also has committed to an additional investment of as much as $1.25 billion in Worldpay to facilitate future acquisitions. According to Reuters, GTCR was able to outbid Advent International, a rival firm that was also interested in a major stake in Worldpay.
FIS will use the capital raised from the sale to retire debt and buy back shares from its current shareholders. The sale comes after months of strategic review and pressure from activist investors concerned with what they have referred to as “underinvestment,” “operational missteps,” and an overall “unsuccessful integration” of Worldpay into FIS. The acquisition will help Worldpay reduce its debt from $20 billion at the end of March to $10 billion when the deal closes next year. The strategic review, led by FIS CEO Stephanie Ferris, is designed to help the firm cut costs by $1.25 billion.
Sans Worldpay, FIS will continue to operate its core processing systems business for banks and FIs, as well as its capital markets division for investment firms. FIS’ capital markets business represents just under 25% of the company’s revenues. The company’s banking technology division provides 46% of revenues and its merchants business accounts representing approximately 30%.
Founded in 1968, FIS has been a Finovate alum since 2010. Worldpay is an alum of our developers conference, presenting its technology to FinDEVr audiences in 2015 and again in 2016.
The road to recovery for crypto may be long. And making meaningful headway may require more than a few instances of taking one step back in order to take two steps forward.
Case in point is the latest hurdle faced by BlackRock as the company seeks to launch a spot bitcoin ETF. On Monday, we learned that the Nasdaq refiled the ETF application with the U.S. Securities and Exchange Commission (SEC) after the regulator highlighted a number of concerns with regard to the original petition. Among the chief concerns was the fact that the Nasdaq did not indicate which crypto trading platforms would participate in “surveillance-sharing” to help combat fraud in the underlying bitcoin markets.
BlackRock was not the only asset manager to hit this regulatory snag en route to the launch of its bitcoin ETF. The SEC also criticized filings from the Chicago Board Options Exchange (CBOE) with regards to a handful of bitcoin ETF petitions from the likes of Fidelity, WisdomTree, VanEck, and a joint project from Invesco and Galaxy – based on similar grounds.
The beneficiary of this hiccup, ironically, appears to be Coinbase, the SEC’s crypto bête noire. In response to the regulator’s concerns, both the Nasdaq and the CBOE indicated in their refilings that they would rely on Coinbase to serve as their “surveillance-sharing” partner. This move both answers one of the primary regulatory concerns vis-a-vis bitcoin ETFs and puts the cryptocurrency innovator back at the center of crypto’s comeback – all this despite the SEC’s antagonistic attitude toward the fintech it filed a lawsuit against in June.
Revolut announced this week that its customers in the U.S. will no longer be able to trade three tokens – Solana (SOL), Cardano (ADA), and Polygon (MATIC). The decision stems from the SEC’s categorization of the three tokens as unregistered securities and the subsequent move by Revolut’s provider, digital asset platform Bakkt, to delist the assets. The delisting will be effective as of September 18th.
Revolut is not the only platform to announced an end to the availability of these tokens for U.S. crypto traders and investors. Both Robinhood and eToro also have either delisted or restricted access to SOL, ADA, and MATIC for U.S. customers. In the case of eToro, tokens such as Algorand (ALGO), Decentraland (MANA), Filecoin (FIL), and Sandbox (SAND) have also been made off-limits for U.S. customers.
Holders of SOL, ADA, and/or MATIC outside the jurisdiction of the SEC will continue to have access to the tokens.
Speaking of “outside the jurisdiction of the SEC,” the Monetary Authority of Singapore (MAS) announced a new set of guidelines designed to help cryptocurrency companies separate customer crypto assets from their own. The new rules insist that digital asset companies that are licensed in Singapore separate customer crypto assets from their own, as well as maintain a separate set of blockchain addresses for customer assets. Companies in the digital payment token business additionally will be required to do daily reconciliation of customers’ digital assets, and maintain accurate records of those assets, as well as access and operational control of customer’s DPTs in Singapore.
The move comes as regulators have become increasingly concerned that cryptocurrency firms have not done enough to “ring-fence” customer crypto assets and keep them segregated from company assets. This problem can be especially acute in the event that a cryptocurrency firm becomes insolvent, making it harder to recover customer funds. The new regulations require cryptocurrency firms to hold customer crypto in trust – though the relative lack of independent, third-party custodians has forced the MAS to offer crypto firms some leniency when it comes to relying on independent custodians at this time. To this end, firms are only required to ensure that crypto custody functions are independent from the firms’ other business operations and divisions.
The new regulations are expected to come online later this year.
A study from Juniper Research from earlier this year indicated that the value of all payment transactions made via stablecoins will top $187 billion by 2028. This represents nearly a 3x gain from 2023 levels. The report, titled CBDCs & Stablecoins: Key Opportunities, Regional Analysis & Market Forecasts 2023-2030, notes the growing use of stablecoins in cross-border transactions, the benefits in terms of speed and traceability that stablecoins offer relative to existing, cross-border rails, and the nature of the competition between stablecoins and central bank digital currencies (CBDCs).
Stablecoins are cryptocurrencies that derive their value from a given fiat currency or commodity. CBDCs are actual digital currencies issued by central banks.
What will it take for stablecoins to reach the transaction levels suggested in the Juniper Research study? Report author Nick Maynard underscored the role of payment platforms and money transfer operators in supporting broader adoption of these digital assets.
“Stablecoins have vast potential to unlock the flow of money across borders, but payment platforms need to roll out acceptance strategies for this to progress,” Maynard observed. “MTOs (Money Transfer Operators) can leverage stablecoins in a wholesale manner, but this will need networks to be built across wide geographic footprints.”
Our last 5 Tales from the Crypto column looked at reasons why the so-called “crypto winter” could see a thaw sooner than many observers think. In a recent column, fintech thought leader and author Chris Skinner shared his thoughts on the resurgent mainstream interest in digital assets.
“Something has changed,” Skinner wrote this week at The Finanser, “and maybe the biggest change is that treasury managers want to use cryptocurrencies. If the customer wants it, then the big banks have to service it and there’s the rub. The big banks have stirred and incorporated digital assets, and specifically cryptocurrencies, into their remit.”
Skinner cited an article at Decrypt.co – Wall Street is coming for crypto, whether early believers like it or not – as well as a June report from S&P Global Ratings titled How DeFi’s Operational Risks Could Influence Credit Quality, that have contributed to his thinking on the topic of late.
“You know that cryptocurrencies are going mainstream when Standard and Poor’s (S&P) start to rate them,” Skinner noted. “They don’t do that today, but they are moving that way.”
Check out the full conversation – as well as the Decrypt.co article and S&P Global Ratings report.
State Employees Credit Union (State ECU) has teamed up with digital banking solutions provider Apiture.
State ECU will leverage Apiture’s Digital Banking Platform to offer its members an enhanced online and mobile banking experience.
Wilmington, North Carolina-based Apiture made its Finovate debut last year at FinovateFall.
New Mexico-based State Employees Credit Union (State ECU) announced a partnership with digital banking solutions provider Apiture. The 65-year old financial institution will leverage the Apiture Digital Banking Platform to offer its members an enhanced online and mobile banking experience.
Headquartered in Wilmington, North Carolina, Apiture offers technology that helps smaller banks and credit unions compete with their larger rivals – as well as launch their own digital-only brands. State ECU will take advantage of both Apiture’s Consumer Banking and Business Banking solutions, as well as the fintech’s Data Intelligence technology. This latter solution is designed to promote digital engagement with both consumers and businesses using highly personalized offers.
“By providing a modern, fully featured consumer and business banking experience, State ECU is poised to deepen member engagement and drive significant growth,” Apiture CEO Chris Babcock said.
Apiture made its Finovate debut at FinovateFall in 2022. At the event, the company demoed an embedded finance solution that enabled users to conduct basic banking tasks from within third-party software. Whether the goal is to open an account, view balances, or transfer funds, Apiture’s embedded finance technology empowers customers without requiring them to visit their bank’s website. The technology gives financial institutions a new revenue stream, and provides customers with greater convenience and an enhanced user experience.
Apiture has more than 300 community and regional financial institution clients. The firm also has partnered with 200+ fintechs. Formed as a joint venture between First Data Corporation and Live Oak Bank in 2017, Apiture has earned recognition from Celent, Javelin, and Juniper for its small business and consumer banking solutions. The company’s API-first strategy gives smaller financial institutions extensive control over the UI, as well as the ability to create unique customer experiences via Apiture’s developer portal.
With more than $1 billion in assets, State ECU is New Mexico’s fifth largest credit union. Founded in 1958, State ECU boasts more than 52,000 members.
London-based open payments gateway Volt has raised $60 million in Series B funding.
IVP led the round, which featured participation from both new and existing investors.
Volt will use the capital to power its expansion into the Asia Pacific region, the Americas, and Australia later this year.
Volt, an open payments gateway based in London, has raised $60 million in Series B funding. IVP led the round, which also featured participation from CommerzVentures, EQT Ventures, Augmentum Fintech, and Fuel Ventures. The investment comes as the company announced plans for an expansion into the Asia Pacific region and the Americas.
The investment also takes Volt’s total equity funding to more than $87 million. New valuation information was not immediately available.
Founded in 2019, Volt currently operates in Europe, the U.K., and Brazil. The company connects more than 5,000 banks, bringing together a generation of account-to-account (A2A) payment infrastructure to a single point of access. Volt’s aggregation model offers a wide-ranging open payments reach and maximizes the speed, security, and resilience of transactions. Volt’s product suite includes Checkout, a unified ommichannel commerce experience; Circuit Breaker, a dedicated fraud prevention solution, Fuzebox, a real-time payments control center for notifications and reporting; Connect, a cash cycle management solution and real-time orchestration engine; Verify, an account ownership authentication tool; and Transformer, a solution to help consumers transition to account-to-account payments.
IVP Partner Angela Zhu praised Volt as “well positioned to redefine the future of payments on a global scale.” Zhu explained: “as over 70 countries, including the U.S., transition to RTP systems, merchants are experiencing the immense benefits of instant, secure, and cost-effective A2A payments.”
In addition to its expansion plans for Asia Pacific and the Americas, Volt is also planning to enter the Australian market later this year. The company will also use the new capital to build out its acceptance network and global reach, as well as enhance its product suite to include cash management. Volt also announced that it will “significantly” bolster its product and engineering teams.
“Testament to our progress and our vision for real-time payments everywhere, we’re thrilled to be working with our new partners at IVP, joining their portfolio of leading global brands” Volt CEO Tom Greenwood said. “We’re staying focused, and humble, as we embark on this next chapter.”
Financial advisor, author, and CNBC commentator Josh Brown raised a few eyebrows this week when he told viewers that he thought that cryptocurrencies were entering a new phase, a phase that could spell the end of the crypto winter.
“This week, I think, with all of these new developments, really forces you to look back and say, ‘What’s really going on here? Why are these people running into a burning building” Brown asked. He referred to the passion for cryptocurrencies as “unkillable.”
Is Brown right? Let’s take a look at the latest round of reasons why the so-called crypto winter could turn out to deliver a milder season than many suspect.
Bitcoin breaks $30k
Prices for the leading cryptocurrency have been in a bear market since at least the fall of 2021 – though cryptoholders have been experiencing more than a little investment indigestion since the spring of that year. And while BTC has much more to go before it nears its old highs north of $60,000, the cryptocurrency has been on a tear since putting in a low in November 2022 just under $18,000. As of June 21st – the longest day of the year – BTC is up more than 90% from its November low. Ethereum, the other most-widely traded cryptocurrency has also performed well in 2023: ETC is up more than 56% year to date.
Many observers are pointing out that much of the velocity of the moves in these leading cryptocurrencies is due to traders who are now covering their earlier – profitable – bets against the assets. Nevertheless, market turnarounds are often initiated not by new participants coming off the sidelines, but by those already in the game deciding to change direction. And sometimes that’s all a new bull market needs to get going.
The news that some of the heaviest hitters in the exchange-traded fund business have expressed interest in bringing BTC to the ETF party is as strong an indication as any that crypto’s fortunes in the near-term may be brightening.
Last week we learned that BlackRock, a major, $9 trillion asset manager, is seeking to launch a spot bitcoin ETF – the iShares Bitcoin Trust – and has filed paperwork with the Securities and Exchange Commission (SEC) to do so. Investment management firm Invesco – which previously sought to launch a bitcoin futures ETF in 2021 but was beat to the market by ProShares – is back for a second bite of the apple. The company has teamed up with Galaxy Digital to apply for a spot bitcoin ETF – the Invesco Galaxy Bitcoin ETF. And lastly, WisdomTree has applied for approval to launch its WisdomTree Bitcoin Trust on the CBOE BZX Exchange.
The stated objectives for the funds vary. WisdomTree highlighted the value of providing investors with exposure to the price of Bitcoin in traditional investment accounts. Invesco and BlackRock both noted that a Bitcoin ETF would serve as a safer alternative for would-be investors leery of cryptocurrency brokerages and exchanges in the wake of the FTX and related crypto-scandals.
New crypto exchange EDX launches
The launch of a new crypto exchange may not seem like big news. But given the pessimism surrounding the industry (“crypto winter” anyone?), it is especially noteworthy that entrepreneurs in the crypto space continue to forge ahead.
New Jersey-based EDX Markets launched its digital asset market this week. The digital asset marketplace provides investors with a trusted, efficient, and liquidy cryptocurrency trading environment. EDX offers competitive quotes and a non-custodial model designed to manage potential conflicts of interest. The company also provides a retail-only quote for crypto, enabling investors and traders to take advantage of better pricing for retail-originated orders. Participants can trade Bitcoin, Ethereum, Litecoin, and Bitcoin Cash on the platform.
The launch of EDX comes as the company secures new funding and additional strategic investors. The amount of the funding was not disclosed. The company did say that the capital will help EDX further develop its trading platform.
“We are committed to bringing the best of traditional finance to cryptocurrency markets, with an infrastructure built by market experts to embed key institutional best practices,” EDX CEO Jamil Nazarali said.
Deustche Bank applies for digital asset custody license in Germany
It’s no secret that cryptocurrencies are feeling more love outside the United States than they are inside the country. Another example of this comes from Germany as we learn this week that Deutsche Bank is seeking a digital asset license. The goal of the country’s largest bank is to leverage digital assets to expand its revenue streams, according to reporting in Bloomberg.
Apparently, Deutsche Bank’s announcement is the latest in a series of slow, cautious steps toward embracing digital assets. The firm’s corporate banking division has been considering digital asset-related services as an option for the past few years. But no firm timeline had ever been offered. This week, we have a destination, if not an itinerary. The head of the bank’s commercial banking unit David Lynne confirmed that the financial institution is building a “digital assets and custody business” and has applied to Germany’s Federal Financial Supervisory Authority (BaFin) in order to receive license to do so.
American crackdown: darkest before dawn?
It may be overly contrarian to suggest that some of the worst news for crypto’s present in recent weeks and months might also be some of the best news from crypto’s future. Many crypto backers lament the SEC’s aggressive policing of Coinbase and the growing share of crypto that is just Bitcoin. But it is possible that this is just the long, arduous process toward eventual regulation. This may mean, at least initially, a time for better, fewer digital assets and better, fewer crypto-related businesses. And while other regions than the U.S. are presently showing more enthusiasm and support for crypto, as with other financial innovations like open banking and instant payments, I’m convinced that once crypto does finally get moving again, the U.S., in its own way, will not hesitate to climb on board.
