This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.
Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Peer-to-peer lending platform and digital bank Zopa landed some extra funds this week, now that its new banking platform is starting to take off.
The U.K.-based company pulled in $28 million (£20 million) from existing investors, bringing its total raised to $465 million.
Investors in today’s round include IAG Silverstripe, which led the round, as well as Augmentum, Alternative Credit Investments, Venture Founders, and others. The company will use the funds to support the growth of its digital bank.
Zopa secured its banking license last June and has since transitioned its platform from a peer-to-peer lending operation to a digital bank with a peer-to-peer lending option. Since that time, Zopa began offering savings accounts, which have reached $346 million (£250 million) in customer deposits, and a credit card product that has made Zopa a top 10 credit card issuer in the U.K. based on new customers.
The new funding comes at a time when competition among digital banks is at an all-time high. Zopa is poised to do well in the battle for new clients and deposits, however. The company has built a well-established client base, resources, and relationships since it was founded in 2004 as a peer-to-peer lending platform.
Zopa CEO Jaidev Janardana echoes this. “Less than a year since launching our bank, we have exceeded our plan for growth, both in terms of customers and balance sheet,” he said. “This capital injection will enable us to continue on this accelerated path. Our strong entry to the U.K. savings and credit card markets shows the organic appeal of our products and we are happy to have investors who share our excitement at the opportunity to serve more customers across more product categories.”
Phone-based fraud prevention company Pindropacquired Next Caller this week. Terms of the deal were undisclosed.
Pindrop anticipates the purchase of NextCaller, a call verification and fraud detection solution for contact centers, will position the company for growth, expand its client base, and position it as an industry leader.
“Our two companies will now be able to service the market in its entirety with the right solution for whatever stage of voice security and authentication they are in,” said Next Caller Co-founder and CEO Ian Roncoroni.
The deal comes at a time when demand for call centers is expanding. In a recent report, Forrester found that 42% of brands surveyed saw an increase in year-over-year call center call volume since the pandemic began. Additionally, 65% of companies reported they struggle to manage the high call volume and 80% of firms reported that fraud is a very serious issue in the call center.
Given this, Pindrop CEO Vijay Balasubramaniyan has a positive outlook for the fraud prevention industry. “We couldn’t be more bullish about the future,” he said, “The need for our combined solutions will only continue to grow as brands across multiple industries not only look to better secure their voice channel, but also improve the customer experience. Understanding who you are speaking to is the most effective way to build a better relationship with customers, resulting in a higher NPS and subsequently more profitable exchanges.”
As for what’s next, Next Caller will operate as a wholly-owned subsidiary under Pindrop.
Founded in 2011, Pindrop debuted an IVR solution as well as the availability of its voice authentication technology for use in OTT streaming devices. Headquartered in Alabama, Pindrop is privately held and has raised a total of $213 million from investors including Andreessen Horowitz and Citi Ventures.
Digital lending platform Blend has agreed to acquire Mr. Cooper-owned Title365 for $422 million.
Blend will leverage Title365 for its title, escrow, and settlement services. Integrating this technology into Blend’s platform will allow the company to automate title commitment upon loan application submission, digitally reconcile settlement fees in real time, and streamline communication among parties. Ultimately, Blend anticipates that Title365’s industry expertise will help minimize costs by integrating title and settlement into the loan process.
Title365 was founded in 2009 and is headquartered in California. The company fits nicely with Blend’s approach of offering a modern experience with its mission “to be the most technologically advanced title insurance and settlement services provider.”
Title365 will be part of Blend’s title marketplace that allows lenders and consumers to choose their preferred title and escrow partner. The tool will be similar to Blend’s insurance marketplace that allows consumers to shop for competitive rates from more than 25 insurance carriers.
“We’re really excited about the agreement to add Title365 to our team as we continue our work to build the full consumer homebuying journey into our platform,” said CEO Nima Ghamsari. “With Title365, we will be able to expand our ability to put lenders at the center of a vastly improved homebuying journey that delivers new levels of efficiency, speed, convenience, and cost savings to everyone.”
Founded in 2012, Blend recently received $300 million in new funding, bringing its total funding to $665 million and boosting its valuation to $3.3 billion. The company facilitated $1.4 trillion in loans last year and counts 285+ lender partners, which together are responsible for around 30% of all mortgage volume in the U.S.
ESG investing is no longer the only environmentally conscious aspect of the financial services world. Recently, we’ve seen an explosion of fintechs– both new and incumbent players– going green.
Here’s a roundup of who’s who in sustainable fintech:
Ando Money
Ando Money is a California-based digital bank that uses client deposits to support green initiatives.
Ant Group
Ant Group, the fintech subsidiary of China-based Alibaba Group, has pledged to go carbon neutral by 2030.
Aspiration
Aspiration is a digital bank that won’t use consumer deposits to fund fossil fuel projects like pipelines, oil drilling, and coal mining. Additionally, the fintech plants trees in collaboration with reforestation partners when users round up their purchases.
Atmos Financial
California-based Atmos Financial offers a savings account that uses client deposits to exclusively finance climate-positive projects at scale.
Carbon Chain
Founded in 2019, CarbonChain offers organizations visibility into the emissions of their supply chains to identify the highest polluting transactions.
Carbon Collective
Carbon Collective offers roboadvisory services that help users divest from fossil fuels and invest in stock market funds that are low-carbon and don’t depend on fossil fuels for their core business.
Carbon Zero
Carbon Zero offers a credit card that rewards users’ purchases by using merchant-paid fees to buy carbon offsets.
Cloverly
Cloverly integrates with existing fintech apps, financial institutions, and payment processing services to assess their carbon impact and determine offsets needed.
Cooler Future
Still in beta, Cooler Future is a Finland-based startup that enables users to invest in a sustainable portfolio.
Doconomy
Doconomy is a Sweden-based digital bank that wants to inspire behavioral changes and reduce unsustainable consumption and carbon emissions.
Ecocart
Ecocart is a browser extension that works with merchants to help customers offset the environmental impact of their online purchase.
Helios
Founded in 2019, Helios is a France-based fintech that offers a digital bank account that helps users offset their carbon footprint.
Joro
Joro connects to users’ payment cards to analyze their carbon footprint and determine the biggest drivers of their carbon footprint.
Meniga
As part of its digital banking platform, Meniga provides a Carbon Insight tool that offers end users visibility into their carbon footprint based on their spending.
NetZero
NetZero connects to users’ bank accounts to determine the carbon footprint of their purchases. The fintech also helps users reduce their emissions and offset their footprint.
Nori
Headquartered in Seattle, Washington, Nori is developing a marketplace for carbon removals.
OpenInvest
OpenInvest helps advisors offer their clients ESG investing that align with their values.
Raise Green
Raise Green offers a marketplace where users can invest in local, impactful projects.
ReGal
Headquartered in the U.K., ReGal offers alternative financial services based on Green Blockchain.
Ripple
Payments network Ripple pledged to be carbon net-zero by 2030 and to decarbonize public blockchains.
Stripe
U.S.-based ecommerce and mobile payments company Stripe offers a tool called Stripe Climate. The offering enables businesses to direct a portion of their revenue to help scale emerging carbon removal technologies.
Tomorrow
Tomorrow offers a digital bank account that uses customer deposits to fund sustainable initiatives. The startup’s premium account, Tomorrow Zero, offers a payment card that is made of wood.
Treecard
Treecard offers a free payment card made of wood. The company donates 80% of its profits to reforestation.
Trine
Trine is a Sweden-based company that allows firms as well as private and professional investors to crowdfund solar energy products.
Tumelo
Tumelo helps investment platforms and pension providers engage investors by showing them the companies in their portfolio and empowering them to vote on ESG issues.
Payments ecosystem giant PayPal announced a collaboration with Flutterwave, a leading payments technology company in Africa, this week. Through the collaboration, PayPal will enable its users to pay African merchants using Flutterwave’s platform.
The partnership will not only connect Flutterwave’s African merchant clients with PayPal’s 377 million accountholders, it will also help them work around the fragmented and complex payments infrastructure in Africa. To use the new functionality, online shoppers across the globe simply select the Pay with PayPal option while checking out at an African merchant’s page online.
Flutterwave launched to help businesses and individuals make payments across the continent flexibly and affordably. This comes at a crucial time for Africa. The ecommerce sector on the continent is expanding and is expected to grow from $16.5 billion in 2017 to $29 billion by next year.
“The collaboration reinforces our vision of creating a seamless digital payments system for Africa’s business communities that can now transact with international consumers,” said Flutterwave Founder and CEO Olugbenga Agboola. “By working with PayPal, we can further strengthen our commitment to our customers and service users as we will be enabling them to transact and expand their business operations to reach new markets.”
Flutterwave was founded in 2016 and has since processed over 140 million transactions worth over $9 billion. Today’s news comes just a couple of days after the company closed a $170 million round at a $1 billion valuation.
Social trading and investment marketplace eToroannounced today that it is making the leap to go public. In true 2021 style, however, the Israel-based company isn’t pursuing an IPO. Instead, eToro is merging with FinTech Acquisition Corp. V, a publicly-traded special purpose acquisition company (SPAC), in a deal worth $10 billion.
When the deal is finalized, the combined company will operate as eToro Group Ltd. and is expected to be listed on the NASDAQ.
The move to go public comes after a period of growth for the Israel-based company. Last year, eToro added more than five million new users and brought in $605 million in revenue, 147% higher than the revenue it saw in 2019. Additionally, average monthly registrations have grown from 192,000 in 2019 to 440,000 in 2020. In January 2021 alone, eToro added more than 1.2 million new registered users. Similarly, the number of trades executed on its platform has grown– from eight million average trades per month in 2019, to 27 million in 2020, and 75 million in January 2021 alone.
“We founded eToro with the vision of opening the global market for everyone to trade and invest in a simple and transparent way,” said eToro CEO Yoni Assia. “Today, eToro is the world’s leading social investment network. Our users come to eToro to invest, but also to communicate with each other; to see, follow, and automatically copy successful investors from all around the world. We created a new category of wealth management – social investing – and we are dominating the market as evidenced by our rapid expansion.”
eToro is the seventh fintech to use a SPAC to go public in the past few months, joining SoFi, BankMobile, Payoneer, MoneyLion, Apex, and OppFi.
eToro was founded in 2007 and has offices in Cyprus, the U.K., Australia, and the U.S. The company is among Finovate’s earliest alums, demoing at the very first FinovateEurope conference in 2011.
What happens after the newest cutting-edge banking technologies become table stakes? Banks move on to tackle another new technology.
In fact, in the past decade or so, banks have been constantly moving from one new technology to the next– from remote deposit capture to merchant-funded rewards, roboadvisory services, AI-informed marketing strategies, and finally on to complete digital transformation.
So now that 2020 served as the year of digital transformation, what’s next? How will banks use their limited resources to get ahead of the curve? Below are a few areas in which banks are focusing their attention to gain competitive advantage:
Communication
Last year we saw multiple financial services organizations update their communication technologies in tandem with digital transformation. But the game of facilitating customer communication is far from over. As Ron Shevlin pointed out in his piece, Every Bank Needs A Chatbot (Or Two) For Its Digital Transformation, chatbots are no longer simply a novelty. Instead, these tools offer fast turnaround for customer inquiries, provide additional data about consumers, and help firms hold personalized conversations with clients.
Another communication enhancement comes in the form of leveraging popular third party apps to communicate with customers. Axis Bank, for example, India’s third-largest private sector bank, recently announced a partnership with WhatsApp. Customers can now use WhatsApp to inquire about their account balance, recent transactions, credit card payments, deposit details, and block their credit or debit card.
Cryptocurrencies
Ready or not, crypto is here! In January, the U.S. Office of the Comptroller of the Currency (OCC) published an interpretive letter detailing that banks can transfer stablecoins to other banks. While banks haven’t been rushing to leverage this functionality, there have been a few moves that indicate financial services are slowly entering the cryptocurrency game.
First off, marketing services company Kasasaunveiled plans to help its bank and credit union clients provide bitcoin wallets to their consumers. Additionally, Mastercard recently announced it willallow merchants to accept payments in cryptocurrencies, and BNY Mellon agreed to begin custody of cryptocurrencies.
Payment tools
With so many payments moving online in the past year, banks need to be even more aware of their role in the online payments flow. In fact, the recent rise in embedded payments poses a risk to banks as third party apps such as Uber and DoorDash make the payment element of a transaction almost disappear.
There’s also been a lot of competition in the booming buy now, pay later (BNPL) space, and not just from third party fintechs like Klarna and Afterpay. Last year, Citi announced Citi Flex Pay, a product that enables cardholders to pay for select purchases over time at a lower interest rate than their card’s purchase rate. And in 2019, JPMorgan Chase launched My Chase Plan, an offering that allows cardholders to make equal monthly payments on purchases of $100 or more with no interest, just a fixed monthly fee.
Offering another tool to make payments more flexible, is U.K.-based fintech Curve. The fintech connects with consumers’ existing payment cards to offer rewards as well as a Go Back in Time feature that lets users switch payments from one card to another for up to 14 days after the purchase was made.
Sustainability
If you’re not green, you’re gone! O.K., maybe not quite, but in the past few months we’ve seen an increase in fintechs working toward a more sustainable future. In fact, just this month there have been multiple headlines that highlight fintech’s green future. First, U.K.-based digital bank Starling Bank launched recycled plastic debit cards. Second, Citi began restricting financing for companies expanding coal power. And finally, Menigapartnered with Iceland’s Íslandsbanki to integrate Meniga’s Carbon Insight into its digital banking solution.
Fintechs are also helping consumers do their part to minimize their impact on the environment. Aspiration, for example, ensures accountholders that their deposits won’t fund fossil fuel projects like pipelines, oil drilling and coal mines. The startup also works with reforestation partners to plant a tree when users roundup their purchase to the nearest dollar. And speaking of trees, Treecard offers a wooden Mastercard and donates 80% of its profits to reforestation efforts.
Ecommerce technology company Stripe announced over the weekend that it recently raised $600 million in funding. The Series H round brings the company’s total funding to $2.2 billion and boosts its valuation to $95 billion.
Investors in this month’s funding round include Allianz X, Axa, Baillie Gifford, Fidelity Management & Research Company, Sequoia Capital, and Ireland’s National Treasury Management Agency.
Stripe will use the funds to expand its Global Payments and Treasury Network and invest in its European operations to support increasing demand in the region. Specifically, the California-based company aims to boost its Dublin headquarters.
“We’re investing a ton more in Europe this year, particularly in Ireland,” said Stripe President and Cofounder, John Collison. “Whether in fintech, mobility, retail, or SaaS, the growth opportunity for the European digital economy is immense.”
Stripe has clients in 42 countries, 31 of which are in Europe. Among the company’s European clients are Deliveroo, Doctolib, Glofox, Klarna, ManoMano, N26, UiPath, and Vinted.
As Stripe pointed out in a blog post, only 14% of commerce happens online. That’s why, as the company’s CFO Dhivya Suryadevara notes, Stripe is “investing in the infrastructure that will power internet commerce in 2030 and beyond.” More specifically, the company is expanding its software and services and is making its technology available to millions more businesses in Brazil, India, Indonesia, Thailand, and the UAE.
“While Stripe already processes hundreds of billions of dollars per year for millions of businesses worldwide, the opportunity ahead is much larger for Stripe than it was when the company was started 10 years ago,” added Suryadevara.
Supply chain financing expert Taulia is making a $6 billion credit facility available to its supplier clients this week. The funds were secured through a JPMorgan-led consortium that also includes UniCredit, UBS, and BBVA.
The news comes after Taulia partner Greensill Finance filed for insolvency earlier this week due to its largest client, GFG Alliance, defaulting on its debts. Taulia expects that the credit facility will help its clients that relied on Greensill Finance by offering them access to a different source of liquidity.
To be clear, the financing is not funding for Taulia itself; it is funding to help suppliers on its platform that are linked to Greensill Capital clients.
“Taulia’s priority, first and foremost, has been to enable businesses both large and small to unlock liquidity trapped in their supply chain in order to invest, operate and thrive,” said Taulia CEO Cedric Bru. “In the current environment, with the potential loss of a funder, our commitment to providing choice has become even more paramount.”
Today’s financing is the continuation of Taulia’s strategic partnership with JPMorgan that began in April of last year. Last July, the financier participated in Taulia’s $60 million financing round that boosted the San Francisco-based company’s total funding to $177 million.
Luvleen Sidhu, CEO of BM Technologies (formerly known as BankMobile), is now one of the youngest female founders and CEOs of a public company.
Since she co-founded BM Technologies in 2014, the company has made major news headlines. We recently spoke with Sidhu to get the background behind some of those decisions and to get her opinion on what it takes to compete in the fintech world as an ethnic minority and a woman.
First off, give us some background on BM Technologies (BMTX) and how it differentiates itself from other challenger digital banking platforms.
Luvleen Sidhu: BM Technologies, Inc. (NYSE American: BMTX, BMTX.W) is among the first neobanking fintechs to go public and is one of the largest digital banking platforms in the U.S. (with over 2 million accountholders), providing access to checking and savings accounts, personal loans and credit cards. We are on a mission to utilize technology to provide millions of Americans with a better banking experience, especially around affordability, transparency and more consumer-friendly products. We are proud to share that we were named the “Most Innovative Bank” by LendIt Fintech in 2019 and we continue to stay true to our mission of being a customer-centric focused company committed to innovation, and financially empowering millions of Americans.
We are a profitable and high-growth company and have been able to build this strong foundation through our Banking-as-a-Service (BaaS) strategy, which enables the acquisition of customers at higher volumes and substantially lower expense than traditional banks. This allows us to provide low-cost banking services to low/middle-income Americans. Today, the BankMobile BaaS platform is provided to colleges and universities through BankMobile Disbursements and serves over two million account-holders, providing disbursement services at 722 campuses, covering one out of every three students in the U.S.
Additionally, BM Technologies executed an agreement with Google to introduce digital bank accounts, which will be available to its customers. We also expanded our white label strategy with T-Mobile for the launch of T-Mobile MONEY.
Tell us about why you chose to offer not only B2C banking products and services, but also banking-as-service tools?
Sidhu: When we launched our company over six years ago, we actually only had a B2C banking product. However, fairly early on, we realized we were not growing at the exponential rate that we had anticipated and our customer acquisition cost was high. This caused us to pause and reevaluate our strategy. We recognized that there was an opportunity to pivot our strategy to a B2B2C model where we could lower our customer acquisition cost to less than $10 and in return still deliver a tech-enabled banking experience to millions of Americans through our distribution partners. This has been critical in our growth and our success as a company.
BM Technologies has its roots in the traditional banking world, having been developed internally by Customers Bancorp. How did that relationship shape BM Technologies?
Sidhu: Customers Bancorp gave us an extremely solid foundation as a company. Even when we launched in 2015, Customers Bank had $6.5 billion in assets. My father, Jay Sidhu was then the CEO of Customers Bank and cofounded BankMobile with me. Richard Ehst, then President of Customers Bank, also helped guide me, along with other members of the company’s leadership team. Having the chance to work with banking veterans provided us with immense knowledge of the industry, which helped us be successful.
BM Technologies is one of the 11 financial institutions collaborating with Google to pilot its Plex bank accounts. What benefits does this partnership offer BM Technologies? Are there any challenges with the new partnership?
Sidhu: This collaboration is mutually beneficial and is differentiated from the others because of our unique college student acquisition funnel. This means we are bringing to Google Plex potentially millions of student customers.
For us, the collaboration offers additional brand equity since Google is one of the leading technology companies in the world and has chosen BM Technologies to work with.
Why did BM Technologies choose to go the SPAC route to become a public company? What opportunities will this offer?
Sidhu: We decided to go the SPAC route because it was a more efficient way for us to take the company public. Our ultimate goal is to add a new white-label partner and gain at least a million new bank customers each year and most importantly provide them with the most financially empowering banking experience. We also plan to use our new funds to continue to focus on innovations and expand our product offerings.
As not only an ethnic minority but also a woman, what have you learned about what it takes to compete in the fintech world?
Sidhu: It takes a lot of determination, flexibility and a “can-do” attitude. I have been raised by two parents who have always supported and encouraged me and given me the tools and resources to succeed. This has helped me throughout childhood and adulthood and has given me a strong foundation to launch my own company. “Never give up” is a motto that my father said to me since I was a young child and one that I truly believe in. There have been obstacles along the way, but by continuing on despite them and overcoming them, I feel I have been able to be competitive.
In general, what developments can we expect in the challenger banking space in 2021?
Sidhu: I think that challenger banks will continue to grow their customer base, becoming increasingly popular with consumers across the country. More and more people are turning to digital banking, and the pandemic accelerated this trend. Challenger banks are nimble and consistently creating new services, which are attractive to Americans. I also believe that more challenger banks will go public this year.
Consulting and IT services company NTT Dataannounced the launch of a new digital banking platform today. The new offering, Platea Banking, helps banks with digital transformation while maintaining their legacy technology.
Platea Banking helps retail banks take a platform-based approach to facilitate a customer-centric focus on the banking experience. The new platform offers banks access to NTT Data’s partner ecosystem and modules, including customer onboarding, lending, planning and financial management, card issuing and processing, payments, and others.
The open banking approach allows banks to select the features they need and move quickly through a platform-based approach that doesn’t tie them down to a single vendor.
“Technology plays a central role in helping banks innovate and deliver next-generation banking services to their customers,” said Global Head of NTT DATA’s Open Banking Practice Manuel Romero. “With consumers demanding digital banking experiences, it is imperative that banks act accordingly to respond [to] their needs. Platea Banking has been built to empower banks, providing them with a path to incorporate cloud-native technology to expand their business, as well as the ability to overcome obstacles such as scalability issues, legacy IT and compliance.”
Founded in 1988 and headquartered in Tokyo, Japan, NTT Data offers a range of IT services and solutions, including consulting, systems integration, and IT outsourcing, for multiple sectors. A Finovate alum, the company most recently demoed at FinovateFall 2019. Yo Honma is CEO.
This is a guest post written by Shannon Flynn, managing editor at ReHack.com.
Across the world, open banking is creating opportunities for banks, fintech platforms, and individuals like never before. Open banking allows third-party sources to use a financial institution’s existing platform or resources to provide their own services. With consumer permission, open banking allows these outside sources to grow the industry and give power to the people.
However, some countries inevitably use open banking more than others. Currently, the United Kingdom and Saudi Arabia are two examples to follow. While the United States has made significant progress, it has a lot to learn from the countries that are leading this form of finance. That way, more opportunities open up for enterprises and consumers alike.
Where the U.S. stands
The U.S. is progressive in some ways with open banking. In others, it needs work. Notably, platforms like Venmo and PayPal expand on what’s possible for users. They allow you to make payments or transfer funds in the blink of an eye. However, compared to other countries, the States fall flat.
Big tech is currently a hot political topic due to the potential mishandling of user data. Though conversations like these are not uncommon elsewhere in the world, the U.S. needs to nail down some federal regulations. As of now, the U.S. still doesn’t have a federal-level law on data compliance. It’s up to each state to enforce its own regulations.
Brick-and-mortar locations may have an easier time following individual state guidelines, but the nature of open banking is inherently digital. These fintech services span across state borders, which makes compliance trickier without federal guidance.
For the country to proceed, the first step will be getting a universal law in place that shows banks and tech companies exactly how they must operate when it comes to compliance.
Engagement must increase
Open banking should welcome disruption. A country with a few centralized banks is one that does not allow for much disruption. Instead, only the top banks and tech companies have room to expand and create, leaving startups and smaller companies in the dust.
The U.S. has big tech companies like Apple, Google, Facebook, and Microsoft that each delve into new tech. For instance, Apple Pay and Google Pay let you buy on smartphones instantly.
The U.K. has an ideal open banking model that disrupts this lack of inclusivity. In 2018, the nation introduced the Second Payment Services Directive (PSD2). This initiative put an emphasis on increasing competition and creativity in the financial field. Ultimately, this directive wanted to create a more equal landscape between banks and fintech companies.
Since its introduction, 300 fintech brands have joined the new finance-oriented environment in the U.K. In the States, new brands pop up all the time. However, whether or not they stick and make an impact is a different story. The competitive market must change in the U.S. so more open banking innovation emerges.
Transparency is essential
People want to know what goes on with their data. They want to know who’s using it and for what — which inherently includes when third-party platforms are part of the equation. In a survey, almost 40% of respondents would reconsider their selected features if it meant a third party required access. This mistrust is a product of poor transparency throughout the industry.
Saudi Arabia recently expanded on its plans to make open banking more accessible for fintech companies. Through this process, transparency becomes a key factor. The Saudia Arabian Monetary Authority (SAMA), the central bank, will create a new initiative that focuses on bringing consumers into the loop.
With the increased use of technology for banking, investing, and mobile payments, more and more people rely on technology daily. SAMA understands this need to combine financial and digital literacy, doing so through open banking. With consumer permission, third parties can use data to connect the financial institution with personal finance services.
The U.S. must use the same tactics of bringing transparency and functionality together through open banking. That way, digital literacy in the U.S. incorporates access to quick purchases, investments, and transfers alongside a better understanding of how companies use data.
Changing the U.S.
Apps like Venmo and PayPal are a good start to open banking. You’ll find that newer fintech platforms, like Robinhood, Acorns, and MoneyLion are popular resources alongside the countless startups launching daily. While nourishing open banking features and fintechs is beneficial, the underlying theme is the most critical — more regulation is the key to widespread adoption. With it, the U.S. can then fully see the benefits of this form of finance.
ShannonFlynn is a technology and culture writer with two plus years of experience writing about consumer trends and tech news.
