Google Pay Steps Up Embedded Finance, Banking Tools

Google Pay Steps Up Embedded Finance, Banking Tools

After reviving Google Pay in November of last year, Google made an announcement today that is sure to turn some heads in the fintech space. The two most relevant elements in today’s news release are new shopping options and spending insights.

To offer new shopping options, Google has partnered with Safeway and Target to help users browse weekly deals on groceries at Safeway and Target locations from within the Google Pay app. The app will enable shoppers to save their favorite items to purchase at a later date. Soon, users will be able to turn on push notifications to see deals from 500 Safeway stores and nationwide Target stores when they are nearby (if they have location services enabled).

The additional embedded shopping tools bring added stickiness to the app. However, Google will need to offer shopping experiences at more than just two stores to truly capture users’ attention.

Google Pay’s new spending insights tool comes a bit closer to what consumers may expect to see at their traditional bank. Via the Insights tab, users can see their account balance, view upcoming bill reminders, analyze weekly spend summaries, and receive alerts when large transactions are made. Under the Insights umbrella, Google also made it easy for users to view transactions by merchant or by category.

While the new spending insights may prove to be useful to shoppers, without more robust budgeting, planning, and forecasting tools Google Pay is unlikely to win consumers over from their traditional bank.

In today’s release, Google also added two more cities in which travelers can pay for transit. Via an integration with Token Transit, users in the San Francisco Bay area and Chicago can purchase and use mobile transit tickets through the Google Pay app. The two new cities join the list of 80 cities and towns across the U.S. that already offer travelers transit purchasing capabilities via Google Pay.

Regardless of the shortcomings of today’s new features, both banks and fintechs should be wary of Google Pay’s next moves. The app’s embedded finance capabilities, including grocery shopping and added transit ticket purchasing, are a signal of what is to come. Similarly, if Google Pay continues to add more personal financial management tools, such as budgeting and retirement planning, consumers may want to spend more time within the Google Pay environment and less time in their traditional banks’ app.

Fiserv Launches QR Code Payments at the Point of Sale

Fiserv Launches QR Code Payments at the Point of Sale

Today brings yet another indication that QR codes are back in style. Fiserv announced it is partnering with PayPal to enable businesses to use QR codes to offer touch-free payments at the point of sale.

Through the partnership, small and mid-sized businesses using Fiserv’s Clover point of sale and large enterprises leveraging the company’s Carat commerce ecosystem will be able to accept payment via PayPal and Venmo through QR codes at the point of sale.

“With consumer preference shifting towards touch-free interactions, it’s critical that businesses are able to connect physical and digital commerce,” said Fiserv’s Head of Global Business Solutions Devin McGranahan. “By enabling consumers to pay digitally via a QR code and popular digital wallets like PayPal and Venmo, businesses are providing added convenience and choice as in-person shopping, dining and entertainment experiences resume.”

As shown in the video above, the QR codes make the touch-free payment process relatively frictionless. Nonetheless, there is one catch– users must have a PayPal or Venmo account and mobile app.

Consumers may be willing to endure the extra friction, however, as people have become more likely to try out new digital technologies in the wake of the pandemic.

Fiserv’s announcement comes about a month after the company agreed to acquire payment processing and payment acceptance startup Pineapple Payments.

Founded in 1984 and headquartered in Wisconsin, Fiserv’s technologies serve nearly six million merchants across the globe. Frank Bisignano is president and CEO.

Kid Capitalism: Teen Banking App Step Secures $100 Million in Series C

Kid Capitalism: Teen Banking App Step Secures $100 Million in Series C

Just a few days after Till Financial picked up a $5 million investment for its “kids-focused” spending management app and Greenlight raised a whopping $260 million for its technology that helps parents raise “financially smart kids,” teen banking app Step announced that it had scored $100 million in Series C funding for its financial wellness solution dedicated toward helping young people develop sound financial habits.

“Our mission is to help improve the financial futures of the next generation and we’re thrilled to have such a massive vote of confidence from investors, especially during Financial Literacy Month,” Step CEO and founder CJ MacDonald said. “Thirty-eight percent of teens say they lack the financial resources needed to achieve financial independence and this is a problem Step is well positioned to help solve as we educate millions of households every day.”

The round was led by General Catalyst and featured participation from an exceptionally diverse group of existing investors. This roster included Coatue, Stripe, Charli D’Amelio, The Chainsmokers’ Mantis VC, Will Smith’s Dreamers VC, Jeffrey Katzenberg’s firm WndrCo, actor Jared Leto, Franklin Templeton and NBA All-Star Stephen Curry. The investment takes Step’s total funding to more than $175 million.

In the time since Step launched in September of 2020, the company has amassed more than 1.5 million users of its financial wellness app. Step gives users a free, FDIC insured bank account, a secured spending card, and access to a P2P payments platform that enables users to send and receive money instantly. With 88% of the company’s users saying that Step is their first bank account, the platform claims that it is the only banking platform that enables youth to build a positive credit history before they reach 18 years old.

“For too long, conversations about money –– specifically how to manage it –– have been avoided despite what a critical role they play in shaping the future of the next generation,” actor, musician, and serial tech investor Jared Leto said. “Over twenty years ago, I set out to tackle this problem by starting a company in the space, so I’m excited to see Step addressing the financial literacy crisis head on with game-changing technology built to help young people learn about money in their digitally native environments.”

Step is headquartered in San Francisco, California, and was co-founded by MacDonald and Alexey Kalinichenko. The company’s financial solutions are backed by bank partner Evolve Bank & Trust.

Greenlight Almost Doubles Valuation in $260 Million Round

Greenlight Almost Doubles Valuation in $260 Million Round

Greenlight, a company that provides financial services technology for kids, announced today it has landed $260 million in funding. Today’s investment nearly doubles the Georgia-based company’s valuation, boosting it up to $260 million.

The Series D round, which brings Greenlight’s total funding to more than $550 million, was led by Andreessen Horowitz with participation from existing investors TTV Capital, Canapi Ventures, Wells Fargo Strategic Capital, BOND, Fin VC, Goodwater Capital. New investors Wellington Management, Owl Ventures, and LionTree Partners also participated. Andreessen Horowitz General Partner David George will join Greenlight’s board of directors.

As for Greenlight’s valuation, the company saw an increase from $1.2 billion to $2.3 billion over the course of six months.

Greenlight will use today’s funds to add more services to its platform, increase its distribution partnerships, and expand to more geographies to ultimately reach more families. Additionally, the company will use the investment to increase its human resources, with a plan to add 300 employees over the next two years.

“Our vision at Greenlight is to create a world where every child grows up to be financially healthy and happy,” said Greenlight Co-founder and CEO Tim Sheehan. “Today’s financing will enable us to bring even more value to families as we continue to introduce new innovative products that shine a light on the world of money.”

Founded in 2014, Greenlight offers a money management platform for families that helps three million parents and kids gain skills to manage their earnings, savings, spending, giving, and learn to invest via a debit card, companion app, and educational resources.

Greenlight has struck a chord with its family-based finances approach. In the past year, the company has more than tripled its year-over-year revenue, more than doubled its users, and doubled its workforce. Earlier this year, Greenlight launched a new products, Greenlight Max, which helps kids research and invest in stocks with parental approval.

“The demand for Greenlight’s family finance solution continues to grow,” said Greenlight Co-founder and President Johnson Cook. “With the support of our investors, we look forward to empowering even more parents to raise financially-smart kids.”

Brex Scores $425 Million to Fuel All-in-One Finance Platform for SMEs

Brex Scores $425 Million to Fuel All-in-One Finance Platform for SMEs

In a round led by Tiger Global, financial services and technology company Brex has raised $425 million, boosting its valuation to more than $7.4 billion.

“Our investors – new and existing – believe in our team, our business model, our product vision, our customers, and the future of Brex,” company co-CEO Henrique Dubugras said. “We are delighted to have them on board for the next phase of our journey.”

Speaking of the next phase, today’s investment comes as the company, which began with a corporate credit card product for venture-backed startups four years ago, announced the launch of a new all-in-one finance platform. The new offering combines spend management technology with billpay in a single dashboard and will be available for $49 a month. The platform facilitates responsible employee spending via corporate and vendor cards, eliminating the need for expense reports and personal reimbursements. Business owners can also easily track spending across business divisions to better understand spending trends by department, merchant, account, as well as by individual employees.

“Growing and maintaining a business should not depend on how good a small business owner is at managing their finances,” Brex CTO Cosmin Nicolaescu said. “Our all-in-one finance solution gives business owners peace of mind, and the time back to do more of what they love and remember why they started their business.”

In addition to this news, the fact that Brex applied to establish a “Brex Bank” earlier this year suggests that the company also could be en route to offering FDIC insured products to small businesses without requiring an intermediary bank as a partner.

“Brex Bank will expand upon its existing suite of financial products and business software, offering credit solutions and FDIC insured deposit products to small and medium-sized businesses (SMBs),” the company noted in February. “Brex and Brex Bank will work in tandem to help SMBs grow to realize their full potential.”

Located in San Francisco, California, Brex includes ecommerce platforms like Cheers and Dr. Squatch, accounting companies like Pilot and Kruze, and startups like Hourly and Bounce among its customers. Founded in 2017, Brex enables companies in a variety of industries to better manage their finances via a combination of payment and cash management solutions. In the first quarter of this year, Brex reported customer growth of 80% and total monthly customer addition gains of 5x. The company said that 45% of its customers are currently small and medium-sized businesses.

“Brex is building the future of finance for the next generation of businesses,” Tiger Global partner Scott Shleifer said. “We are excited to partner with them as they continue growing rapidly, innovating their product offerings, expanding their customer base and leading an industry that is dominated by incumbents.”

Also participating in this week’s Series D round were new investors TCV, GIC, Baillie Gifford, Mardrone Capital Partners, Durable Capital Partners LP, Valiant Capital Management, and Base10. Existing investors Y Combinator Continuity, Ribbit Capital, DST Global, Greenoaks Capital, Lone Pine Capital, and IVP were also involved in the investment.


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MX and Moov Bring Instant Account Verification to Fintechs

MX and Moov Bring Instant Account Verification to Fintechs

MX, which began the year with a $300 million investment that boosted its valuation to $1.9 billion, is collaborating with developer-first payments platform Moov Financial to give fintechs and other companies instant account verification (IAV) and money movement.

“Moov is transforming the way fintechs enable account verification, money movement, and ACH payments through APIs,” MX cofounder and CTO Brandon Dewitt said. “We align with their mission to help fintechs and organizations focus on building amazing new experiences. Fintechs like Moov are a big reason why a massive digital shift is happening across the banking industry.”

Moov enables platforms, marketplaces, and software companies to embed payment functionality into their solutions, providing seamless money acceptance, storage, and disbursement. The combined, turnkey solution enhances the account verification process, providing a faster, more secure, and reliable experience for customers who are adding banking or payment functionality to their offerings.

“Whether you think of yourself as a fintech or not, every modern company is seeking a way to automate its process to accept, store, and disburse money,” Moov CEO Wade Arnold said. “Developers want the best user experience possible for their application. MX’s ability to provide fast IAV makes the payment experience swift and more seamless than it would have been without the joint solution.”

A multiple time Finovate Best of Show winner, MX provides connectivity and data enhancement for more than 16,000 financial institutions and fintechs – including 85% of digital banking providers. Among the Utah-based firm’s most recent collaborations is its partnership with AbbyBank. The $616 million asset community-owned bank launched its PFM solution – an embeddable digital money management tool powered by MX and offering budgeting, subscription tracking, debt management, and more – in March.

“With MX, AbbyBank is giving its customers across Wisconsin greater clarity into their personal finances,” MX Chief Customer Officer Nate Gardner said. “(It’s) exactly the kind of innovation, partnership and money experience that MX loves to enable through our powerful data platform.”

Founded in 2010, MX most recently demonstrated its technology at FinovateFall 2019.

Banking Technology Provider NYMBUS Scores $15 Million Investment

Banking Technology Provider NYMBUS Scores $15 Million Investment

News of NYMBUS’ $15 million fundraising this week – and the company’s recent appointment of three women to key leadership positions – serves as a fitting bookend to a first quarter that began with big investment and big C-suite hires, as well.

In January, the Miami, Florida-based banking technology provider expanded its leadership team with the addition of Chief Alliance Officer Sarah Howell and Chief Product Officer Larry McClanahan. A month later, Nymbus secured a Series C investment of $53 million in a round led by Insight Partners.

“As the pandemic has pushed digital to the forefront, more banks and credit unions have turned to Nymbus as their partner for growth,” Nymbus CEO and Chairman Jeffery Kendall said when the funding was announced in February. “This new and significant investment validates a confidence in Nymbus to continue transforming the financial services industry with a banking strategy that buys back decades of lost time to speed digital innovation.”

Little did we know how quickly further valuation would arrive. This week’s investment by European private equity firm Financial Services Capital doubles its investment in Nymbus to more than $31 million. The funding gives Nymbus a total capital raised of more than $98 million.

“We look forward to continue working with Nymbus as they build out a best-in-class, cloud-native offering that is well positioned to be a leader in the industry and will transform our portfolio companies,” Financial Services Capital Managing Partner Miroslav Boublik said. He and fellow Managing Partner Matthew Hansen will join the Nymbus Board of Directors as part of the investment.

Also joining “Team Nymbus” is Veeva Systems co-founder Matt Wallach, who will serve as a Strategic Advisor. Nymbus will benefit from Wallach’s experience in co-founding one of the leading cloud software companies in life sciences. Founded in 2007 and, 14 years later, the first publicly traded company to transition into a public benefit corporation, Veeva now has a market capitalization of more than $40 billion and 975+ customers in the pharmaceutical industry, as well as in emerging biotech.

As mentioned, Nymbus’ funding announcement comes on the heels of the company further bolstering its leadership ranks with a trio of new, C-suite hires. The women – Trish North as Chief Customer Officer, Michelle Prohaska as Chief Compliance Officer, and Crina Pupaza as Chief People Officer – bring years of customer success, risk management, and people-centered programming experience to a company that has seen significant growth as banks turn increasingly toward digital transformation of their outdated legacy systems.

“In order to help our partner institutions serve the unique financial needs of niche audiences, success begins with diversity in our own Nymbus leadership,” Kendall said last week when the appointments were announced. “I’m incredibly proud of the impactful effort we are making to recruit a balanced male to female representation into our C-suite, and beyond confident of the value that Trish, Michelle, and Crina will each uniquely provide to both our team and partner clients.”


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Mastercard to Acquire Digital Identity Specialist Ekata for $850 Million

Mastercard to Acquire Digital Identity Specialist Ekata for $850 Million

Mastercard’s announced $850 million acquisition of digital identity firm Ekata is a reminder that there is no way forward in digital commerce without a 21st century attitude toward issues of security and trust.

“The shift to a more digital world requires real solutions to secure every transaction and instill trust in every interaction,” Mastercard president of cyber and intelligence solutions Ajay Bhalla said. “With the addition of Ekata, we will advance our identity capabilities and create a safer, seamless way for consumers to prove who they say they are in the new digital economy.”

Seattle, Washington-based Ekata offers global identity verification to enable businesses around the world to link digital transactions to the people who make them. Via APIs and a SaaS tool, Ekata leverages data science and machine learning to help businesses detect fake accounts, cross-verify consumer data, reduce payment risk, and fight transaction fraud. With more than 2,000 corporate partners ranging from global merchants and financial institutions to marketplaces and digital currency platforms, Ekata enables its businesses to gain unique and valuable insights that allow them to make better risk decisions about their customers.

“The acceleration of online transactions has thrust global digital identity verification to the forefront as one of the biggest opportunities to build digital trust and combat global fraud,” Ekata CEO Rob Eleveld said. “The right identity verification solutions enable inclusive and frictionless experiences while, at the same time, ensuring customer privacy, control and security. Becoming part of the Mastercard Identity family ensures a broader, collective approach to meeting the growing demands of the digital economy.”

Founded in 2019, Ekata unveiled its merchant onboarding solution earlier this month. Designed to meet the needs of PSPs, B2B lenders, and marketplaces working with smaller, micro-merchants and sole proprietors, Ekata’s new platform automates the onboarding process via API and provides for more efficient manual review with a SaaS solution.

“Merchants today have plenty of options and will quickly turn to another payment service provider if an organization adds too much friction at onboarding or takes too long on approvals,” Ekata VP of Global Marketing Beth Shulkin said in a statement. “This is much more than a customer experience issue for PSPs and lenders; losing the lifetime value of a merchant has real bottom-line impact.”


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Sensibill Brings SKU-Level Data Insights to AbbyBank

Sensibill Brings SKU-Level Data Insights to AbbyBank

A new partnership between AbbyBank and FinovateFall Best of Show winner Sensibill will enable the Wisconsin-based community bank to give its customers the ability to de-clutter and digitize their financial lives.

“In today’s online world, customers expect more convenience to bank how they want,” AbbyBank AVP of Marketing Natalyn Jannene said. “Our partnership with Sensibill will help our customers and employees with digitizing the shoebox of receipts or overstuffed purses and wallets, making it easier for them to track receipts, exchanges, and warranties in one place.”

Founded in 2013 and headquartered in Toronto, Ontario, Canada, Sensibill offers a receipt management solution that makes it easier to organize and track everything from Health Savings Account receipts to expenses from government relief programs like the Paycheck Protection Program. Sensibill’s everyday financial tools give financial institutions the ability to tap into – and act upon – SKU-level transaction data in order to provide their customers with the kind of personalized financial insights that can help them build better financial habits. More than 60 million individuals across North America and the U.K. use Sensibill’s AI-powered technology.

The company’s newest solution – Sensibill Platform – features a pair of new tools – Spend Manager and Spend Insights – that provide financial institutions with more ways to drive digital engagement with their customers and members. Spend Manager leverages predictive analytics to help customers track and manage their everyday spending, while providing personalized tips and custom advice based on their transactions. Spend Insights enables financial institutions to draw upon more than 150 unique points of data from purchases, and pair them with transaction data to anticipate customer needs and preferences in real-time.

“Sensibill is empowering institutions of all sizes to harness SKU-level data to offer personalized experiences and recommendations that help make customers’ hard-earned money go further,” Sensibill co-founder and CEO Corey Gross explained when the platform was unveiled in January. “The time to act is now – by better contextualizing the transaction-level data they already have with SKU-level insights, institutions can help their customers make smarter financial decisions. Those that do will retain loyalty and expand market share while making financial wellness more attainable for all.”

In addition to its newly-announced partnership with AbbyBank, Sensibill in recent months has also teamed up with Leaders Credit Union of Jacksonville, Tennessee ($520 million in assets) and Progress Bank, a $1.4 billion asset bank that serves customers in Alabama and in the Florida panhandle. Last month, Sensibill earned recognition as the winner of the “Personal Finance Innovation” category of the FinTech Breakthrough Awards.

A Finovate alum since 2017, Sensibill has raised more than $55 million in funding. The company’s investors include First Ascent Ventures, Information Ventures Partners, Impression Ventures, Mistral Venture Partners, and Radical Ventures. Sensibill also secured $5 million in debt financing from CIBC Innovation Banking a year ago.

This week’s partnership with Sensibill is only the latest instance of AbbyBank working with innovative fintechs in order to add to its own offerings. Last month, the Wisconsin-based community bank – with more than $616 million in assets – teamed up with another Best of Show-winning Finovate alum, MX, to power its new PFM solution.

“The goal is to help our customers improve their financial awareness,” Jannene said when the collaboration with MX was announced in March. “Knowing where money is spent allows you to manage your money more effectively. When our customers succeed, we succeed and that is truly what AbbyBank is here for.”


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Why Coinbase’s Public Debut Matters

Why Coinbase’s Public Debut Matters

The news is abuzz with excitement about Coinbase’s IPO. The San Francisco-based digital currency platform began trading on the NASDAQ under the ticker COIN for $381 per share today and closed out the day at just over $328 per share.

It’s always exciting when a fintech company goes public, but there are a few reasons why Coinbase’s debut is particularly compelling:

Legitimacy

Coinbase’s listing helps legitimize cryptocurrency in general. Many everyday consumers consider cryptocurrency as a medium of exchange for fraudsters and bad actors on the dark web. This will shift, however, to placing digital currencies in a more positive light and consumers will begin to understand the true benefits of crypto– a tool for faster payments, a way to lower fees, and an agent for a more inclusive financial system.

Sets the stage

The Coinbase IPO sets a precedent for others in the cryptocurrency industry to go public. Digital currency wallets and crypto marketplaces are closely tied to the price of cryptocurrencies, which have historically been extremely volatile.

Despite the uncertainty, Coinbase has proven to be profitable. According to the New York Times, Coinbase made $730 million to $800 million in net profit on $1.8 billion in revenue in the first quarter of this year. The company’s performance in the public eye will dictate the moves of others in the cryptocurrency industry, including bitcoin exchange Kraken, which is considering a public listing next year.

Ready for CBDCs?

One effect we may see come from Coinbase’s move into the public eye is its potential to prime the U.S. market for central bank digital currencies (CBDCs). This reflects back to the first discussion point about offering a sense of legitimacy to the cryptocurrency realm.

The U.S. hasn’t taken any formal actions toward the launch of its own digital currency. However, multiple other nations, including China, Brazil, and Russia, have recently made announcements regarding their own nations’ CBDCs. Bringing cryptocurrency into the realm of traditional finance helps ready the everyday U.S. consumer for the eventual proliferation of digital currencies.

An increase in demand

Will Coinbase’s exposure outside the cryptocurrency space increase the number of people holding digital currencies?

Ben Weiss, CEO of crypto ATM provider CoinFlip answers it this way, “While it is hard for us to know if more people will get into crypto just because Coinbase is trading publicly, we know for sure that at least people who were too scared of the volatility of bitcoin can now take a more traditional approach by buying Coinbase stock. There will definitely be a lot of these people and hopefully this is a gateway for them to get into bitcoin over time.”

Hatch Raises $20 Million for Small Business Banking

Hatch Raises $20 Million for Small Business Banking

Small business financial services platform Hatch unveiled its funding total today. The California-based company has pulled in $20 million in two funding rounds since it was founded in 2018.

The first investment, a Seed round that closed in January 2019, totaled $5 million. The company’s Series A round closed in February of last year, totaling $14 million.

Hatch’s investors include Kleiner Perkins, Foundation Capital, and SVB.

Hatch offers small businesses a line of credit and a business checking account which it launched this January. The checking accounts come with a Mastercard debit card and allow Hatch’s 4,000 business users to send money through ACH, billpay, or via digital checks from the Hatch dashboard. Additional features include overdraft protection and cashback rewards.

Because Hatch uses machine learning to complete KYC, KYB, and OFAC compliance checks, businesses can get approved for a checking account in under five minutes. Accounts cost $10 per month and feature a transparent fee structure.

Founded by Thomson Nguyen, Hatch has a team of 48 people, 40 of which were brought on in the past year during the pandemic.


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Better.com Lands $500 Million in Funding After Record Year

Better.com Lands $500 Million in Funding After Record Year

Mortgagetech innovator Better.com recently landed a $500 million investment from Japan-based Softbank, bringing the company’s total funding to over $900 million.

According to the Wall Street Journal, which broke the news, Softbank is buying shares from existing Better investors, a list which includes Goldman Sachs, Citigroup, and Kleiner Perkins.

With the new round, experts estimate Better’s valuation to be around $6 billion. This is a significant jump from the company’s most recent valuation, which sat at around $4 billion after Better closed a funding round in November of last year.

Better was founded with the goal of reengineering the mortgage process. The company streamlines mortgage originations by taking the entire process online. Better also offers Better Real Estate, which matches buyers with real estate agents; Better Settlement Services, which offers title insurance; and Better Cover, a home insurance marketplace.

The new investment comes at a time of significant growth for Better. Inspired by low interest rates, more consumers have been refinancing their properties. The Wall Street Journal reports that because of this increase in demand, Better lent out $25 billion in loans in 2020 and has extended $14 billion in loans the first quarter of this year.

Better saw $800 million in revenue last year and is expected to go public by the end of 2021. Founded in 2014, the company is headquartered in New York City. Vishal Garg is CEO.


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