Author: David Penn

Thought Machine Secures $54 Million Investment from Italian Bank Intesa Sanpaolo

Thought Machine Secures $54 Million Investment from Italian Bank Intesa Sanpaolo
By David Penn Posted on
Categories: Alumni News, Daily news, Funding, Thought Machine
  • Core banking technology innovator Thought Machine has signed a partnership with Intesa Sanpaolo, Italy’s largest bank by total assets.
  • As part of the partnership, the bank has invested $54 million (£40 million) in the U.K.-based fintech.
  • The partnership with Intesa Sanpaolo is the third bank partnership Thought Machine has secured this year.

U.K. based core banking technology company Thought Machine inked its third bank partnership of 2022 this week, teaming up with Italian Bank Intesa Sanpaolo. The collaboration will bring Thought Machine’s core banking engine, Vault, to the Italian financial institution, who will use the technology to power its new digital banking platform Isybank. The new platform will be geared initially toward the bank’s four million mass-market customers in Italy. Beyond that, Intesa Sanpaolo plans to further deploy Thought Machine’s core banking technology into its infrastructure more broadly, swapping out mainframe-based core technology in favor of the cloud.

Pointing to the digital preferences of its younger clientele, Intesa Sanpaolo CEO Carlo Messina said, “this new digital bank will evolve our retail business from incumbent to fintech challenger in the mass market, with the option to expand internationally.”

In addition to the technology partnership, Intesa Sanpaolo announced that it would invest $54 million (£40 million) in the U.K.-based bank technology firm. The funding takes Thought Machine’s total capital to more than $402 million.

“We chose Thought Machine as our partner due to its international standing as a fintech innovator,” Messina added. “We believe so strongly that Thought Machine is the right partners for this transformation that we are also announcing our investment in the company to be a part of its growth story.”

With 13.5 million customers in Italy and 7.1 million customers around the world, Intesa Sanpaolo and its subsidiaries are active in 12 countries in Central and Eastern Europe, as well as in Egypt. The bank is the largest in Italy by total assets and one of the 30 biggest banks in the world.

A Finovate alum since its debut at FinovateEurope in 2018, Thought Machine has sealed partnerships with three banks so far in 2022, including Intesa Sanpaolo. Thought Machine began the year announcing that Al Rajhi Bank Malaysia (ARBM) would leverage its technology to build an Islamic digital bank later this year. ARBM is a subsidiary of Al Rajhi Bank of the Kingdom of Saudi Arabia, the world’s largest Islamic bank by assets. The deployment of Thought Machine’s Vault is part of a multi-year digital transformation project begun last year by ARBM. The bank has credited Vault’s product building functionality for enabling it to create a full suite of Shariah-compliant banking products.

Also this year, Thought Machine announced that U.S. mutual savings bank Mascoma Bank will deploy Vault and migrate its customers to the new technology. A certified B corporation serving customers in the New England states of New Hampshire, Vermont, and Maine, Mascoma Bank will use Vault to both innovate and add new solutions to its product line, as well as provide the institution with a single source of record by housing all of its data in a single location to more easily understand and serve its customers.

“We believe that modern technology is the key to unlocking superior customer service,” Mascoma Bank president and CEO Clay Adams said. “We are proud at Mascoma Bank to be different by design – we are adopting Thought Machine’s modern technology to deliver on our mission of better serving our customers and communities, to offer new products and be a leader in community banking.”

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Filipino Neobank Tonik Secures $131 Million; Latin American Payments Company EBANX Turns Ten

Filipino Neobank Tonik Secures $131 Million; Latin American Payments Company EBANX Turns Ten
By David Penn Posted on
Categories: Daon, Entersekt, Finastra, Finovate Global, NICE Systems, Nordigen

Tonik, a digital neobank based in the Philippines, has secured $131 million in a Series B round that will help the institution expand in the Philippines, as well as throughout Asia. The investment was led by Mizuho Bank of Japan, and gives the company $175 million in total funding.

Also participating in this week’s Series B funding round were Prosus Ventures, Sixteenth Street Capital, Nuri Group, and individual investor Rahul Mehta, co-founder of DST Partners. Valuation estimates were not immediately available.

Launched in the Philippines in the spring of 2021, Tonik has been one of of the fastest growing new banks, topping $100 million in consumer deposits in its first eight months of operation. The neobank has partnered with Finovate alums Finastra for its cloud-based core banking proposition, NICE Actimize for its AML technology, and Daon for its biometric authentication solutions. In the Philippines, where more than 70% of the population is unbanked, Tonik sees a $140 billion retail deposit market and an unsecured lending opportunity of $100 billion.

“The partnership with Mizuho will provide Tonik with enhanced access to the international wholesale funding markets and world-class managerial talent, as well as serve as a fantastic platform for our future international expansion,” Krasnov said.

Tonik offers a variety of retail financial products, including deposits, loans, current accounts, payments, and cards. The first licensed, digital-only bank in Southeast Asia, Tonik began this year with a partnership with Google Cloud. The neobank will leverage Google Cloud’s platform as part of its strategic to boost financial inclusion and open banking in the Philippines.

EBANX Emerges from its First Decade

Last month we highlighted Latin American payments company EBANX and its expanded operations in Mexico. This month, we congratulate the Brazil-based fintech on its 10-year anniversary.

“In these 10 years, we have been able to witness important transformations in the digital market, in the payments industry, and in innovation ecosystems around the world,” EBANX co-founder and CEO João Del Valle said in a statement. “We are pleased to have actively participated in these movements in Brazil and Latin America, using cutting-edge technology and local knowledge.”

With nearly a billion total payments processed and offices in ten countries, EBANX notched more than 110 percent in processed volume last year. Also in 2021, EBANX launched its EBANX One payments platform that unites all of its payment solutions via a single integration, acquired a pair of Brazilian fintechs Juno and Remessa Online, and raised $430 million in Series B funding. Already in 2022, EBANX has opened new offices in Mexico City and appointed former Google VP Paula Bellizia as its new president of Global Payments.

“Today is the day to celebrate all the achievements so far,” Del Valle said, “but, above all, to outline the new challenges ahead, always with the clear mission of creating more access between people and companies from all over the world.”

FinovateEurope 2022 is just one month away. If you are an innovative fintech company with new technology to show, then there’s no better time than now and no better forum than FinovateEurope. To learn more about how to demo your latest innovation at FinovateEurope 2022 in London, March 22-23, visit our FinovateEurope hub today!

Here is our look at fintech innovation around the world.

Asia-Pacific

Sub-Saharan Africa

Central and Eastern Europe

Middle East and Northern Africa

Central and Southern Asia

Latin America and the Caribbean

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Payments Orchestration Platform Spreedly Inks Pact with Stripe

Payments Orchestration Platform Spreedly Inks Pact with Stripe
By David Penn Posted on
Categories: Alumni News, Daily news, Spreedly
  • Spreedly announced an integration that will expand the number of local payment methods available via Stripe.
  • Among the supported payment methods are IDEAL, Bancontact, Giropay, EPS, Alipay, Afterpay / Clearpay, Sofort, and Przelewy24, as well as Apple Pay and Google Pay.
  • Spreedly’s announcement comes in the wake of strong transaction volume growth from its operations in Latin America.

Payments orchestration platform Spreedly and payments processor Stripe have expanded their partnership to enable access to more local payment options. As part of the announcement, Spreedly underscored that its customers will have access to Stripe’s fraud fighting solution, Radar, as well.

“This latest integration allows joint Stripe and Spreedly customers to offer their customers a variety of payment methods and provides access to Radar, helping to manage the fraud risks associated with accepting payments online,” Spreedly Senior Director of Product Andy McHale explained.

By offering customers a broader range of local payment alternatives, merchants are able to reach more customers, bring down transaction costs, and boost conversion rates. Payment orchestration, such as that available from Spreedly, helps provide this flexibility, giving merchants and merchant aggregators the option of not only transacting with a wider variety of gateways and payment services, but also enabling them to test and experiment to find out which services work best for their customers.

First announced in November, access to Stripe’s Radar feature gives Spreedly customers the ability to bring machine learning to bear to detect and block fraud. Radar leverages data across millions of international companies processing billions of payments a year to assign risk scores and block high-risk payments. McHale noted that while many merchants and platforms do integrate fraud fighting solutions, working with companies like Spreedly can provide significant advantages.

“(Integrating) fraud tools and payment gateways via a Payment Orchestration Platform simplifies system complexity by reducing the number of direct vendor integrations and orchestrating them to work together,” McHale said.

This week’s news from Spreedly arrives in the wake of the company’s announcement that European payments company Worldline had joined Spreedly’s Payment Service Provider program. The Durham, North Carolina-based company began the year with news that transaction volume from Latin America had grown by more than 100% year-over-year.

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Charitable Giving App Daffy Secures $17.1 Million in Funding

Charitable Giving App Daffy Secures $17.1 Million in Funding
By David Penn Posted on
Categories: Daily news, Funding
  • Charitable giving app Daffy has received $17.1 million in funding.
  • Daffy was co-founded by CEO Adam Nash, former president and CEO of Wealthfront.
  • In the U.S., individuals gave more than $324 billion to charitable organizations in 2020.

Aside, the company behind charitable giving app Daffy, has secured $17.1 million in Series A funding. The round was led by Ribbit Capital and featured participation from XYZ Capital and Coinbase Ventures, along with more than 50 angel investors including Amy Chang and John Lilly. The company will use the funds to help scale Daffy and bring additional product innovations to market to help encourage more people to participate in charitable giving.

“People want to be generous and help those less fortunate than themselves, but we are all busy and life gets in the way,” explained Daffy CEO and co-founder Adam Nash. “My co-founder Alejandro and I believe that all of the innovations that have helped us shop, save, and plan, Daffy can also use to help people make giving a habit.”

Americans are often credited for being among the most generous charitable givers in the world. One study by Giving USA revealed that individuals in the U.S. gave more than $324 billion to charities in 2020. That said, Nash believes there remains a “Generosity Gap” between what Americans give to charities and what they would give if the process were easier. The company cites a study by the Stockholm School of Economics that suggested that something as simple as pre-commitment – agreeing in advance to make a charitable contribution – can boost an individual’s contribution amount by as much as 32%.

To this point, Daffy works by encouraging users to provide a charitable giving goal for the year and asking them to take the “Daffy Pledge” to set aside money on a weekly, monthly, or quarterly basis to reach that goal. As the funds accumulate, Daffy invests the money in one of nine portfolios – rather than having the money sit in low-to-zero interest-bearing cash accounts. When the goal is reached, user can access the funds to make their tax-deductible donation to one of more than 1.5 million U.S. charities available via the Daffy platform. The company said that 40% of its users take advantage of the “Daffy Pledge” option for regular contributions.

Headquartered in San Francisco, California, Daffy takes its name from the acronym DAF, which stands for donor-advised fund. These funds are tax-deductible accounts specifically designed for charitable giving. Assets from cash to stock to cryptocurrencies can be placed in a DAF and donors can take immediate tax deductions on those contributions.

“Daffy takes many of the amazing innovations we’ve seen in fintech to a large new space, charitable giving,” Ribbit Capital Managing Partner Micky Malka said. “Within seconds, you can donate to your favorite causes and charities from anywhere. By building a seamless and habit–forming giving experience, Daffy is not only creating a better way to give, but a better way to live.”

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A Baker’s Dozen of African American Influencers in Fintech and Financial Services

A Baker’s Dozen of African American Influencers in Fintech and Financial Services
By David Penn Posted on
Categories: Diversity in Fintech, List series

As part of Finovate’s continued commemoration of Black History Month, we’re showcasing some of the African American fintech and financial services influencers and leaders who are driving innovation and inclusion in our industry.

If you’ve ever lamented the lack of African Americans in the typical fintech influencer lists issued year after year, then hopefully this sampler of African American fintech entrepreneurs, technologists, and founders will help bring a little more color to the face of fintech.

Harry Alford III

Alford (LinkedIn) is Head of Institutional Sales at Coinbase Cloud where he is focused on sales and business development via partnerships and collaborations with financial institutions, businesses, and fintech startups. He is also co-founder of Humble Ventures, a Washington, D.C.-based venture development firm that supports and invests in founders and organizations that build solutions for diverse communities.

Jacqueline M. Baker

Baker (LinkedIn) is Vice President of Startup Programming at the AARP Innovation Labs where she leads a team dedicated to identifying promising startups via pitch competitions and accelerators. An expert in modern etiquette, leadership, and disruptive innovation, Baker is also founder and principal consultant at Scarlet Communications, an Upper Marlboro, Maryland-based firm that offers modern leadership guidance, professional training and coaching.

Marla Blow

Blow (LinkedIn) is President and Chief Operating Officer of the Skoll Foundation, an organization that invests in, networks, and champions social entrepreneurs and social innovators. In her role at Skoll, Blow leads the firm’s program, grants, investments, and financial management, including its operations, endowments and portfolio partnerships. She is also a member of the board of directors for Square Financial Services.

Asya Bradley

Bradley (LinkedIn) is co-founder and Chief Operating Officer at First Boulevard, a neobank and fully inclusive financial services company dedicated to helping Black Americans build generational wealth. Also the founder of #HowSheWorks, an inclusive grassroots community of founders and allies from underrepresented communities, Bradley has previously worked as SVP of Revenue at banking-as-a-service innovator SilaMoney, and as VP of Partnerships at identity verification specialist – and Finovate alum – Socure.

Chris Brummer

Brummer (LinkedIn) is a professor and faculty director at the Institute of International Economic Law at Georgetown University Law Center. He has lectured frequently on topics ranging from financial inclusion and equity to financial regulation and global governance. A member of the board of directors of Fannie Mae and the co-founder of the Fintech Beat Podcast, Brummer is author of a number of books including Fintech Law in a Nutshell and Cryptoassets: Legal, Regulatory, and Monetary Perspectives.

Thasunda Brown Duckett

Duckett (LinkedIn) is President and CEO of TIAA, a Fortune 100 financial services company that provides investing, retirement, and banking advice to academic, medical, non-profit and public sector professionals. Duckett has an extensive background in financial services, including executive tenures at JP Morgan Chase and Fannie Mae. She is a member of the board of directors at a number of organizations including NIKE, and the Economic Club of New York, as well as being part of the Dean’s Advisory Board for the Baylor University Hankamer School of Business.

Roger W. Ferguson, Jr.

Ferguson J. (LinkedIn) is the former President and CEO of retirement services company TIAA. He was previously Head of Financial Services at Swiss Re and a member of the company’s Executive Committee. He also served as Vice Chairman of the Board of Governors with the Federal Reserve from 1999 to 2006. A Harvard University graduate, earning a B.A. in Economics, a J.D., and a PhD in Economics from the institution, Ferguson Jr. also spent 13 years as an associate and partner with McKinsey & Company.

Jon Fortt

Fortt (LinkedIn) is Co-Anchor of CNBC’s TechCheck (previously Squawk Alley) where he specializes in the intersection of technology, finance, and innovation. Formerly a senior writer with Fortune, Fortt is an author, designer, and publisher of an educational course called The Black Experience in America that draws on diverse sources ranging from Shakespeare to Toni Morrison.

Donald Hawkins

Hawkins (LinkedIn) is co-founder and CEO of First Boulevard, the “unapologetically Black, digitally native bank” designed to help African Americans build generational wealth. An ICBA Bankers’ Choice 2020 recipient, Hawkins is a serial entrepreneur who, before launching First Boulevard, founded Griffin Technologies, a Kansas City, Missouri-based firm that helps community banks and credit unions improve customer engagement, boost sales, and compete with larger financial institutions.

Netta Jenkins

Jenkins (LinkedIn) is Vice President of Global Inclusion at Unqork, a no-code application platform that helps businesses build complex, customized software solutions faster while keeping costs low. Recognized by Forbes as one of the top seven anti-racism educators in the world, Jenkins is also co-founder of Dipper, a digital safe-space and community for professionals of color to share their experiences in the workplace.

Rodney Williams

Williams (LinkedIn) is co-founder and Chairman of SoLo Funds, a fintech that serves underrepresented communities in the U.S. by providing an alternative lending option that emphasizes equity and empowerment. Williams also co-founded ultrasonic data platform LISNR, a technology company that provides secure person-present authentication. A Henry Crown Fellow at The Aspen Institute and a Techstars Mentor, Williams received his MBA in Finance and Supply Chain Management from Howard University in Washington, D.C. Find out more about Williams and SoLo Funds in our interview from earlier this month.

Teri Williams

Williams (LinkedIn) is President and Chief Operating Officer at OneUnited Bank, the largest Black-owned bank in the U.S. She is responsible for both implementing the bank’s strategic initiatives as well as managing the day-to-day operations of the institution. She has led OneUnited Bank in its consolidation of four local banks into a cohesive, national brand that provides affordable financial services for all while supporting economic development and wealth building in urban communities. An executive with OneUnited Bank for more than 26 years, Williams was previously a Vice President at American Express.

Dana L. Wilson

Wilson (LinkedIn) is a professional speaker and consultant who helps financial services firms create inclusive workspaces. She is also founder and CEO of CHIP (Changing How Individuals Prosper), a B2B2C marketplace for companies seeking Black and Latino financial professionals. A Diversity, Equity & Inclusion Award Winner and self-described “FinServ Techie”, Wilson is also the host of The Included Series Podcast, a program that features people of color sharing their personal financial journeys.

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Betterment Embraces the Cryptocurrency Revolution with Makara Acquisition

Betterment Embraces the Cryptocurrency Revolution with Makara Acquisition
By David Penn Posted on
Categories: Acquisition, Alumni News, Betterment, Daily news
  • Investment platform Betterment will acquire cryptocurrency portfolio manager Makara. Terms were not disclosed.
  • The acquisition will enable Betterment to incorporate automated, personalized digital asset investing into its roboadvisory services.
  • Seattle, Washington-based Makara was founded in 2021 and has raised $2.1 million in seed funding.

Mr. Money Mustache may not like it. But the news that online investment platform Betterment has agreed to acquire cryptocurrency portfolio manager Makara is yet another sign that incumbent fintechs are playing a major role in helping crypto go mainstream.

“Crypto is here to stay and Betterment wants to live our promise of long-term diversification and to provide our customers with the best variety of assets in the marketplace,” Betterment CEO Sarah Levy explained. Levy praised the Makara acquisition as a unique opportunity to bring Betterment customers managed cryptocurrency portfolios “combined with the guidance and ease-of-use that have defined Betterment.”

Headquartered in Seattle, Washington, Makara was founded in 2021 by Jesse Proudman and Sadie Raney. The company is the first crypto-based roboadvisor to be registered with the SEC, and offers investment exposure to the cryptocurrency market that is both automated and personalized to the investor’s goals and preferences. Makara investors can select cryptocurrencies organized into thematic baskets – Bitcoin, Blue Chip, Decentralized Finance, Ethereum, Inflation Hedge, Metaverse, Universe, and Web 3.0 – that cover the wide (and growing) range of digital asset offerings.

Betterment leverages passive index-tracking and fixed income ETFs to offer goal-based investing strategies via both taxable and tax-advantaged accounts such traditional and Roth IRAs. The addition of Makara will enable the New York-based investment platform to give investors the ability to diversify their accounts without having to worry about selecting individual digital assets. The acquisition will also make it easier for Betterment’s financial advisor customers to offer cryptocurrency exposure to their clients without those advisors having to be experts in the digital asset arena.

The acquisition is expected to close later in Q1 of 2022. Makara’s team of experts and engineers will join the Betterment team at that point.

“We developed Makara to bring an easy and accessible long-term investing approach to cryptocurrencies,” Makara co-founder and CEO Jesse Proudman said. “Combining our crypto expertise with Betterment’s scale will accelerate the growth of the platform with both retail investors and financial advisors.”

Betterment made its Finovate debut in 2010, winning Best of Show for its online savings and investment platform. In the years since, the company has grown into one of the world’s leading digital investment advisors, with more than 700,000 customers and more than $33 billion in assets under management. Last fall, the company announced raising $160 million in funding – including a $60 million in Series F equity investment – earning the New York-based firm a valuation of $1.3 billion.

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The Conversation Continues: Greg Palmer and the Finovate Podcast

The Conversation Continues: Greg Palmer and the Finovate Podcast
By David Penn Posted on
Categories: Podcasting

Another year begins – and so does the latest round of podcasts hosted by one of fintech’s favorite conversationalists, Finovate VP Greg Palmer!

In his most recent discussions on the Finovate Podcast, Palmer has talked about the challenge of inclusivity when it comes to lending in financial services, as well as the hurdles innovative companies face when trying to turn inspiration into reality and promise into winning, marketable products that delight and engage customers. And with the new year just getting underway, the Finovate Podcast also took stock of some of the major trends in fintech in 2021 with an eye toward seeing how they will be resolved here in 2022.

Find the Finovate podcast at Soundcloud and follow Greg Palmer on Twitter for the latest in programming news and updates.

Kurt Lin, Co-founder and CEO, Pinwheel

Host Greg Palmer talks with Pinwheel co-founder and CEO Kurt Lin about the problem of inaccessibility and credit invisibility in our financial system and what Pinwheel is doing to innovate in the lending space. Episode 118.

“What we do at Pinwheel is pretty straightforward: we look at all the different income sources that exist – whether it be payroll systems, gig platforms, or future of work platforms like Etsy or ebay – and we combine it into a platform and make it really easy for anyone to connect their income account or their payroll account to any app for the purpose of sharing that data or to do things like update direct deposits.”

Steven Ramirez, CEO, Beyond the Arc

Host Greg Palmer sits down with Beyond the Arc CEO Steven Ramirez to discuss predictions for 2022, cryptocurrencies, fintech super apps, the Buy Now Pay Later revolution, and more. Episode 117.

“There is huge hype and excitement about crypto which is, of course, leading to greater adoption. More people are finding on-ramps to crypto and some of them are super simple. If you look at Coinbase or Paypal, they really could not make it any easier to acquire your first cryptocurrencies. However, there is a lot behind that initial purchase about how you actually use cryptocurrency and some real sticking points that I think are going to be nasty surprises for consumers.”

Alex Castro, CEO, M Corp

Host Greg Palmer and Alex Castro, CEO of M Corp and author of Measure, Execute, Win, investigate the challenge of navigating the “execution gap” by strategically examining the space between strategy and results. Episode 116.

“We’ve seen over the last 10 years a great surge in innovation and ideas that can really help grow industries and companies. All too often those ideas fall to the wayside during the execution process, and that gap between idea or strategy and execution still remains the largest roadblock for these great ideas to get to market. We’ve analyzed that issue and we have some very deliberate methods and products to help resolve that gap so that more ideas can be more successful.”

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Fiserv Agrees to Acquire Finxact in Deal Valued at $650 Million

Fiserv Agrees to Acquire Finxact in Deal Valued at $650 Million
By David Penn Posted on
Categories: Alumni News, Daily news, Fiserv, Mergers & Acquisitions
  • Fiserv has agreed to acquire Finxact in a transaction valued at $650 million.
  • The acquisition will help bolster Fiserv’s position as “partner of choice” for firms looking to add to their digital banking offerings.
  • First Data Ventures, the corporate arm of 2019 Fiserv acquisition First Data, was an early investor in Finxact.

Leading fintech and payments company Fiserv announced today that it has agreed to acquire cloud native banking solution provider Finxact. An early investor in the company, Fiserv will purchase the remaining ownership interest in Finxact for $650 million, and will leverage the acquisition to add to Fiserv’s account processing, digital, and payments solutions.

“Through this combination, Fiserv will create a streamlined path for clients to offer digital solutions to their customers,” Fiserv President and CEO Frank Bisignano said. “Finxact also enhances our ability to support a growing number of financial institutions and business clients.”

Jacksonville, Florida-based Finxact offers a core-as-a-service platform that enables financial institutions to innovate and bring new solutions to market without requiring a complete technological overhaul of existing systems. Finxact leverages open banking APIs and the cloud to help firms future-proof and add flexibility to their businesses by abstracting the critical components of core banking from other operations and services – such as mobile banking, communications, and statements. The company’s partners range from financial institutions like Live Oak Bank ($8.2 billion in assets) and Iberiabank’s Virtual Bank to fintechs like Personetics and Anchorage Digital.

Calling the acquisition a “tremendous opportunity” for his six-year old company, Finxact Chairman and CEO Frank Sanchez said, “We recognize that Finxact’s technology can serve to level up the industry’s delivery infrastructure, and crucially at a time when banking is undergoing transformative change. We will be better positioned to serve a far greater number of institutions, of all sizes, when combined with the breadth and depth of Fiserv capabilities.”

Finxact was founded in 2016 and has raised $42 million in funding. The company ended 2021 with the introduction of its no-code visual Product Launchpad, a platform enhancement that brings a visual design experience to the creation and deployment of products on the Finxact core.

The acquisition of Finxact is only the latest fintech deal by Fiserv since its big, $22 billion purchase of First Data Corporation in 2019. Last fall, Fiserv announced the completion of its acquisition of marketing and commerce platform BentoBox. The year before, Fiserv acquired digital card services platform Ondot. Other recent acquisitions include its pick-up of Bypass Mobile in 2020 and NetPay in 2021. The company’s most recent Finovate appearance was at FinovateWest 2020, an all-digital event in which Fiserv demoed its Virtual Banking Assistant. The technology brings AI-driven, conversational experiences to call center operations, boosting customer engagement and reducing costs.

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Kuwait Issues Guidelines for Digital Banks; QR Codes Versus Cash in Argentina

Kuwait Issues Guidelines for Digital Banks; QR Codes Versus Cash in Argentina
By David Penn Posted on
Categories: Finovate Global, Mambu, NCR Corporation, Nordigen

According to a report from Medici, nearly 168 million people in the MENA region (Middle East and Northern Africa) do not have a bank account. In this environment, opportunities for both traditional financial institutions and new entrants are numerous. In some instances, financial services companies have launched their own digital banking portals in order to reach out beyond their current customer bases. In other cases, these firms have teamed up with challenger banks and innovative fintechs to help bridge the gap between the banked and the unbanked.

One of the challenges to reaching more potential customers in the MENA region has been regulatory, which makes this week’s news from the Central Bank of Kuwait (CBK) all the more notable. The CBK issued a set of guidelines for digital banks as part of a campaign to improve financial stability, encourage innovation, and help the country respond to its economic needs.

In drawing up its guidelines, the CBK relied on a study of the regulatory approaches taken by 25 central banks and 40 digital bank business models. The CBK noted that there were three main models for digital banking: as a unit within a traditional bank, a partnership between a bank and a digitally-based institution in which the bank manages core banking operations while the partnering institution manages customer relations and other operations, and as a standalone digital bank.

“The guidelines come in five parts covering the definition of digital banks, their legal framework, and licensed activities, as well as phases and procedures for establishment of digital banks,” CBK Governor Dr. Mohammad Y. Al-Hashel said. The new guidelines pave the way for interested parties to apply from now until June 30th. Initial approvals, according to the CBK governor, will be made by the end of the year.

For more on the digital banking landscape in the Middle East, with a particular focus on neobanks, check out this overview from Medici.

Speaking of central banks, the head of Argentina’s central bank, Miguel Ángel Pesce, recently gave an interview with the Buenos Aires Times. The main focus of the conversation was a preliminary agreement with the International Monetary Fund to deal with the country’s $44.5 billion debt to the organization. The agreement, which includes a pledge to reduce the country’s fiscal deficit as well as other measures, comes after a two-year negotiation process and still requires the approval of both Argentina’s congress as well as the IMF board of directors.

Yet it was Pesce’s separate conversation with Buenos Aires reporter Jorge Fontevecchia – published this week – that may be of greater interest to followers of international fintech. In that interview, Pesce explained some of the more controversial policies of Argentina’s central bank toward fintechs, including deposit insurance requirements for payment service companies. Pesce defended the practice as a way of “making more independent the assets of companies lending out the assets deposited in them” and of assuring that companies that serve as financial intermediaries are regulated as such. Pesce acknowledged that while this policy has engendered “some resentment in the short term,” it is necessary to ensure a “solid system” that banking services customers can rely upon.

In terms of innovation, Pesce spoke positively about the launch and adoption of interoperable QR codes, which were made mandatory in Argentina for all electronic invoices starting in late December 2020. He noted that interoperable QR codes could do to physical cash what electronic checks have done to paper checks (“a very important step in this direction”). And while he offered no timetable on the transition, “it’s going to end up happening,” Pesce insisted.

Read the full interview at Buenos Aires Times

FinovateEurope 2022 is right around the corner. If you are an innovative fintech company with new technology to show, then there’s no better time than now and no better forum than FinovateEurope. To learn more about how to demo your latest innovation at FinovateEurope 2022 in London, March 22-23, visit our FinovateEurope hub today!

Here is our look at fintech innovation around the world.

Latin America and the Caribbean

Asia-Pacific

Sub-Saharan Africa

Central and Eastern Europe

Middle East and Northern Africa

Central and Southern Asia

Photo by Shahbaz Hussain Shah from Pexels

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Cross River Bank Teams Up with PayTile to Offer Location-Based Payments Solution

Cross River Bank Teams Up with PayTile to Offer Location-Based Payments Solution
By David Penn Posted on
Categories: Daily news, Partnership Outlook
  • Cross River Bank and PayTile announce collaboration to offer a new location-based payments solution.
  • The companies compare the new solution to Apple’s AirDrop, which enables the sending of data without an exchange of PII.
  • In addition to the partnership, PayTile is launching a new cash drop-off technology Money Drop.

A partnership between Cross River Bank and online payments company PayTile will bring a new location-based payments solution to market. PayTile is among the first P2P payment platforms to use geo-location to enable safe and private financial transactions between individuals without requiring exchange of personal information. The company will leverage core banking infrastructure and payments functionality – including ACH and Push-to-Card capabilities – from Cross River Bank for the new offering.

“PayTile’s mission is to make digital payments as private as cash and as safe as a card,” PayTile CEO Anu Vora explained. “While traditional P2P apps exist to pay the people you already know, PayTile exists to safely pay people you don’t know.”

PayTile’s technology is designed especially to be used in situations in which physical cash would be the preferred option. This includes tipping in hospitality-related instances, as well as informal transactions such as shopping at local farmer’s market. The company compares the location-based payment service to iOS’s “AirDrop” capability, enabling money transfers without requiring an exchange of usernames, legal names, emails, or phone numbers.

“Anu and the team at PayTile are revolutionizing peer-to-peer payments,” Cross River founder, president, and CEO Gilles Gade said. “By partnering with innovative companies like PayTile, Cross River creates real time solutions to empower consumers and their finances.”

The partnership announcement comes at the same time that PayTile is launching its Money Drop technology which enables the digital placement of cash or other digital goods at an exact location for users to pick up and redeem at their convenience. One use case of Money Drop, according to PayTile, would be for the company’s business partners to use the technology to draw a physical crowd to a specific location for promotional purposes, such as selling discounted tickets at an event location or offering rewards to commemorate the opening of a brick-and-mortar business.

Founded in 2008 and headquartered in Fort Lee, New Jersey, Cross River Bank ended 2021 with new collaborations with money movement automation platform Astra and payments firm Payment Approved. With Astra, Cross River Bank will power the first point-to-point debit transfer solution, offering instant payments via API. With Payment Approved, Cross River Bank will provide both the payments and technology infrastructure to support payments via Push-to-Card capabilities with both Mastercard and Visa. Cross River Bank will also serve as the sponsor bank for Payment Approved, providing clearing accounts, FBO management, and merchant acquiring services for the company’s business customers.

Photo by Baskin Creative Studios from Pexels

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Look Who’s Making Their Finovate Debuts Next Month in London at FinovateEurope

Look Who’s Making Their Finovate Debuts Next Month in London at FinovateEurope
By David Penn Posted on
Categories: FinovateEurope 2022, Speaker series

In addition to many of the familiar faces who will be returning to London next month for FinovateEurope, this year’s conference also will feature a sizable number of newcomers to the Finovate stage. Here’s a brief introduction and welcome to these FinovateEurope speakers to whet your appetite for what we have in store on both our Digital Kick Off Day of March 15th and during the conference proper on March 22nd and 23rd.

With more than 20 years of experience in advisory services within Swedish bank Handelsbanken, Malin Lignell currently works with the company’s Digitalization and Innovation team to enable greater innovation and focus on the bank’s digitalization journey. Having a keen eye on the way emerging technologies influence customer behavior and drive new business models, Lignell will lead a Fireside Chat as part of FinovateEurope’s Digital Kick Off event on March 15.

Author of The Fifth Industrial Revolution, Inma Martinez will provide FinovateEurope’s Keynote Address on Wednesday, March 23rd. Martinez is a digital pioneer and AI scientist, as well as a member of the Expert Group at The Global Partnership on Artificial Intelligence (GPAI), an AI-based initiative sponsored by the OECD and G7. An advisor to business and government leaders on how to turn digital transformation into competitive advantage and contribute to social progress, Martinez will share her insights on creating an exceptional customer experience via UX-led design. Borrowing from the successful experience of technology giants, Martinez will explain how financial institutions can pivot away from a product focus to a customer focus by “unlocking data” and enhancing customer engagement.

Here are some of the other newcomers who will be joining FinovateEurope as part of our Power Panels, roundtables, and Executive Boardroom sessions.

  • Radboud Vlaar. Founder and Managing Partner at Finch Capital, Vlaar will join our Future of Fintech power panel on our Digital Kick Off, Tuesday, March 15.

Our Executive Boardroom on Financial Inclusion on Tuesday, March 22 will feature five fintech experts, all of whom are newcomers to the Finovate roster.

  • Anette Broloes. Fintech analyst with Broloes Consult.
  • Natalie Ledward. Head of Vulnerable Customers, Monzo
  • Sanghamitra Karra. EMEA Head of Multicultural Client Strategy & Multicultural Innovation Lab at Morgan Stanley
  • Neha Mehta. Founder of FemTech Partners
  • Ahmed Karsli. Founder and CEO of Papara

Tuesday will also feature an Executive Boardroom on Financial Crime. Among the new faces on this panel are Jane Barber, Regulatory and Trade Association Lead, NatWest Group; and Nitzan Solomon, Head of Surveillance & Financial Crime Technology EMEA, Nomura.

Wednesday morning will feature a pair of Power Panels with a number of guests who will be appearing on the Finovate stage for the first time. Our panel on achieving digital acceleration includes newcomers Christoffer Malmer, Head of SEBx at SE; Gunter Uytterhoeven, Chief Customer & Innovation Officer at AXA Next; and Carol Hamilton, Senior Vice President of Global Solutions at Provenir. Making their Finovate debuts as part of our panel on fintech collaboration and partnerships are Janine Hirt, CEO of Innovate Finance, and Thea Loch, Head of Strategic Design with Lloyds Banking Group.

FinovateEurope 2022 is right around the corner. If you are an innovative fintech company with new technology to show, then there’s no better time than now and no better forum than FinovateEurope. To learn more about how to demo your latest innovation at FinovateEurope 2022 in London, March 22-23, visit our FinovateEurope hub today!

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Treasury Prime Unveils New Compliance Suite

Treasury Prime Unveils New Compliance Suite
By David Penn Posted on
Categories: Daily news

San Francisco, California-based Banking-as-a-Service company Treasury Prime unveiled its new compliance solution this week. The new offering – a suite of compliance tools, resources, and guidance from regulatory experts – gives fintechs the ability to create and launch their own risk-based compliance programs in a matter of weeks.

The compliance suite has three main components. First is a toolkit that enables firms to customize their compliance program and have more control over the account opening experience. Second, the new offering provides for direct partnerships with bank partners rather than outsourcing compliance to third parties. And, third, Treasury Prime’s compliance suite includes guidance from regulatory experts on key issues such as Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) compliance. Each of these features is tailored to the specific and unique risk profiles of individual fintechs.

Sheetal Parikh, Associate General Counsel and VP of Compliance Solutions for Treasury Prime noted that the rise of stricter compliance standards for fintechs make new compliance solutions for this industry all the more urgently needed. “Regulators now expect fintechs to adhere to the same level of regulatory obligations as banks if they’re going to be offering banking products,” Parikh said. “Our new solution provides fintechs (with) the sophisticated tools and expert guidance needed to quickly build a strong compliance framework that meets the robust compliance standards imposed on banks.”

To facilitate the new compliance offering, Treasury Prime had teamed up with a pair of regtech innovators, Alloy and Unit21. The Alloy partnership will bring compliance and identity management solutions for both KYC and AML via a single API connection. Courtesy of Treasury Prime’s partnership with Unit21, banks and fintechs will be able to deploy pre-configured rule-sets and models to monitor transactions for suspicious activity. Real-time collaborative alert investigation is also a feature of the Unit21 collaboration.

Founded in 2017, Treasury Prime was recognized last fall as “Best Banking-as-a-Service” platform at the Tearsheet Embedded Awards, and named to CB Insights Fintech 250 roster of top fintech startups for 2021. In recent months, the company has partnered with Emprise Bank ($2.3 billion in assets) to help the institution with its new embedded banking initiative. Treasury Prime also teamed up with women-owned Piermont Bank to help early stage startups go live with basic banking services as part of the collaboration’s Quick Start Program.

Treasury Prime has raised more than $31 million in funding according to Crunchbase. The company’s investors include QED Investors, Deciens Capital, Nyca Partners, Pacific Western Bank, Susa Ventures, and Y Combinator, among others. Chris Dean is co-founder and CEO.

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