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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Western Union is leveraging Plaid’s open banking infrastructure for money transfers in Europe.
The move is expected to benefit end users by offering a faster, more secure payments experience without negatively impacting the user experience.
Leveraging open banking payments will also create operational efficiencies for Western Union employees.
Plaidannounced this week that Western Union has selected to leverage its infrastructure to offer its customers in Europe seamless open banking payments. Western Union anticipates the move will offer its customers additional flexibility in how to send money to family and friends.
By leveraging open banking technology, funds transferred using Western Union will be faster and will have higher thresholds for safety and security without adding friction to the user experience.
“Consumers are demanding easier and simpler border-less payments without compromising on security, said Plaid Head of Europe Brian Dammeir. “Plaid is delighted to collaborate with Western Union to enable users to make larger payments, safer and faster.”
The new technology will also benefit Western Union employees by creating operational efficiencies. Plaid’s open banking technology streamlines Western Union’s internal operations and enhances its payment infrastructure by providing a common standard of funding across Europe.
“It was great working with Plaid to offer a new, easier way of doing money transfers with us,” said Western Union VP Omnichannel Marketing Bart Stence. “This collaboration shows how we at Western Union invest in innovation to provide our customers with the flexibility and trust they need.”
Jio Financial Services parent Reliance Group launched its own financial super app, JioFinance.
JioFinance serves as a single place where users can conduct digital payments, apply for loans, and purchase insurance.
Jio Financial partnered with Blackrock last year and is expected to enter the wealth management space in the future.
TechCrunch unveiled this morning that Jio Financial Services parent and multi-sector conglomerate Reliance Group launched its own financial super app, JioFinance.
Jio Financial’s new JioFinance app launched today in the Google Play store and aims to serve as a single place where users can conduct digital payments, apply for loans, and purchase insurance. The bank accounts are held with Reliance-owned Jio Payments Bank, which was granted a banking license by the Reserve Bank of India in 2015.
“Introducing JioFinance, for your fast and secure UPI payments, seamless bill payments, and timely reminders,” the app description reads. “Enjoy instant rewards and benefits on all UPI transactions. Instant account opening in a few minutes, with zero balance feature, interest rate as high as 3.5% and a digital passbook, with Jio Payments Bank. Take control of your finances with easy tracking and analysis of your spends in a few clicks. Pay bills, track expenses, and save money with the JioFinance app!”
Today’s launch comes after Jio Financial formed a partnership with Blackrock in 2023 to add wealth management offerings to its existing insurance and lending offerings. Also in 2023, Jio Financial announced it was leveraging alternative data to enhance its personalization efforts.
Unlike the U.S., India has a growing scene of true super apps players. Reliance’s competitors in the space include Tata Group and Paytm. Tata Group’s Tata Neu aims to integrate a range of services from e-commerce and finance to travel and health under one platform. And Paytm, which originally launched as a mobile wallet and payment app, has expanded into a super app by adding banking, financial services, and e-commerce functionalities.
The new offering for financial institutions enables users to monitor recurring payments and make real-time changes from within their banking app.
Atomic most recently demoed its technology earlier this month at FinovateSpring in San Francisco.
Payroll connectivity innovator Atomicunveiled its latest offering: PayLink Manage. The new solution is an actionable subscription management tool for financial institutions that enables users to monitor recurring payments and make real-time changes from within their banking app.
“By integrating PayLink Manage, banks can not only improve their service offerings and increase engagement, but also can solidify themselves as the primary banking relationship,” Atomic CEO and Co-Founder Jordan Wright said. “When banks help their account holders with innovative insights that are actionable, everybody wins.”
PayLink centralizes and automates oversight and control of recurring payments. Users can connect, view, and track a variety of payment types from subscriptions and bills to streaming services and mortgage payments. PayLink Manage also enables users to make real-time changes to their subscriptions directly within the banking app. Additionally, courtesy of Atomic’s direct connectivity, financial institutions can gain insights into usage data, itemized receipts, and other key subscription information. This facilitates deeper analysis, driving more personalized guidance that helps users save money.
“PayLink leverages Atomic’s proven technology, which has already facilitated millions of secure connections across financial platforms,” Atomic Chief Product Officer Andrea Martone said. “With this launch, we are extending our trusted, robust connectivity framework to subscription management, providing financial institutions with a tool to enhance customer engagement and improve retention by helping people take action to improve their financial outcomes.”
Headquartered in Salt Lake City, Utah, Atomic made its most recent Finovate appearance earlier this month at FinovateSpring in San Francisco. At the conference, the company demoed its subscription management technology, which leverages its access to payroll, HRIS systems, and merchants to support a range of financial services, including direct deposit switching, income and employment verification, and more. Founded in 2019, Atomic has raised more than $68 million in funding from investors, including ATX Venture Partners and Portage Ventures.
Small business banking platform Relay raised $32.2 million in a Series B round led by Bain Capital Ventures.
Relay will use today’s funds to further develop products in spend management, smart credit products, and its financial API marketplace.
Relay recently unveiled a commercial credit card offering and plans to launch a line of credit.
Small business banking and money management platform Relayraised $32.2 million this week. The Series B financing round, which was led by Bain Capital Ventures brings the company’s total funding to $51.6 million.
Today’s round also includes contributions from new investor Industry Ventures, as well as previous contributors BTV, Garage, and Tapestry. “Relay’s been on an incredible trajectory, even as others in the industry have had to pivot and find new footing,” said Bain Capital Ventures Partner Kevin Zhang. “We were eager to get behind Relay again as the company enters its next stage of growth and doubles down on the unique needs of the SMB market.”
Relay was founded in 2018 to help small businesses owners build healthy businesses by better understanding and managing their cashflow. Through its partnership with Thread Bank, the company offers business checking and savings accounts, accounts payable tools, receipt management, and– most recently– a credit card for select users. Relay also said that its launch of a line of credit offering is “slated to come.”
“68% of U.S. small business owners have cash flow problems. They worry about making payroll and mission-critical bills but lack the tools to truly address these existential threats,” said Relay Co-founder and CEO Yoseph West. “Relay gives them cash flow clarity and control—what SMBs need to sustainably fuel everyday operations—by pairing financial services with software and making banking work harder for them.”
Relay will use today’s funds to further develop products in spend management, smart credit products, and its financial API marketplace. The company believes these developments will help it achieve its goal of delivering AI-powered predictive cash flow analytics to SMBs.
Relay saw its revenues rise by 3x in 2022 and by almost 6x in 2023. While the company has not released user numbers, Relay revealed that business owners log into its platform 13 times per month, and of the clients that use Relay as their primary account, 40% log in daily.
Embedded finance and digital banking solutions provider Finotta has announced a strategic partnership with Constellation Digital Partners (Constellation).
Constellation will integrate Finotta’s Personified platform into its own solution to help credit unions offer personalized financial guidance to their members.
Finotta made its Finovate debut at FinovateFall 2022 in New York.
Embedded finance and digital banking solutions provider Finottaforged a strategic partnership with Constellation Digital Partners (Constellation). A cloud-native digital banking services provider, Constellation will integrate Finotta’s Personified platform into its own solution to give credit unions new resources to boost member engagement and satisfaction, as well as drive digital growth.
“More than 90% of consumers expect their financial institution to offer a modern digital banking platform, but this is table stakes,” Finotta Founder and CEO Parker Graham said. “The key is differentiating the experience based on what members need and want, which is financial guidance. Unfortunately, this is also where massive missteps are made. Many traditional PFMs inadvertently shame consumers for poor financial habits rather than encourage positive behavior, killing the overall experience. As a result engagement is down considerably.”
Founded in 2018 and headquartered in Overland Park, Kansas, Finotta made its Finovate debut at FinovateFall 2022 in New York. At the conference, the company demoed Personified, a suite of products that enable FIs to provide personalized financial guidance via their mobile banking apps. Personified helps financial institutions anticipate member and customer needs, increase product conversions, and deliver actionable financial guidance – all in a single solution. The platform helps banks and credit unions leverage the digital channel to generate more revenue, improve financial performance, and boost profitability for members and customers.
Last year, Finotta noted that its Personified platform had increased user engagement compared to other mobile banking apps, with an average use of 13 minutes per month per user. According to Graham, this compares favorably to the “less than one minute per month” that users spend on the average mobile banking app. Not only does this reflect a significant lack of engagement from users, it also limits the FIs ability to cross-sell other products and services. Finotta also pointed to a study from Oracle that suggested as much as 40% of customers believe that independent PFM apps are superior to the offerings provided by most financial institutions.
“Embedded (Finotta’s) technology into our platform will equip credit unions with the tools they need to thrive in the digital age while delivering personalized, seamless, and exceptional service to their members every step of the way,” Constellation SVP and Head of Product Aaron Oplinger said. “We look forward to the value this will bring our industry.”
Founded in 2017 and headquartered in Raleigh, North Carolina, Constellation Digital Partners is a leading provider of mobile and digital banking solutions for community-based financial institutions. The company is dedicated to empowering both credit unions and community banks with innovative solutions for mobile banking, online account management, personalized financial insights, and more. The company has raised $17 million in funding via a Series A round completed in 2020. Kris Kovacs is President and CEO.
Business banking platform Rho has partnered with Navan to launch a jointly branded tool that will allow Rho’s business clients to add and manage their Rho Corporate Cards directly within Navan.
The partnership is leveraging Navan Connect, a card-link technology that extends Navan’s No Expense Reports experience to authorized expense partners.
The new, joint tool offers business clients a unified interface that saves them from having to coordinate multiple applications across separate vendors, or having to manage different costs and workflows.
Rho has teamed up with Navan to launch a new, jointly branded tool that will help simplify the way businesses manage their finances.
Leveraging Navan Connect, the new co-branded solution will allow businesses to add and manage their Rho Corporate Cards directly within Navan after configuring the cards using the Rho platform. Businesses can use the new finance suite to manage corporate travel and expenses, enforce expense policy compliance, send payments, and close their books. The unified interface saves businesses from having to coordinate multiple applications across separate vendors, or having to manage different costs and workflows.
Launched in 2023, Navan Connect is a card-link technology that extends Navan’s No Expense Reports experience to authorized expense partners. Using this technology, businesses can embed travel and other spending policies with Rho, which will offer finance departments control of and visibility into employee expenditures.
“We’re excited to partner with Navan to help businesses simplify the finance stack and save time and money,” said Rho Co-founder and CEO Everett Cook. “The years we’ve spent building the world’s best business banking platform infrastructure opens up ample opportunities for Rho to explore compelling partnerships with world-class organizations like Navan.”
New York-based Rho was founded in 2018 to serve as an all-in-one financial platform for businesses and organizations. In addition to checking and savings accounts and credit cards, the company offers expense management, AP automation, treasury management, and now business travel expense tracking and management.
Formerly known as TripActions, California-based Navan was founded in 2015 and leverages AI to create an enhanced user experience around booking corporate travel. Navan has made four acquisitions and now counts 2,900+ employees across 40 markets.
“Small- and medium-sized businesses need a complete suite of financial tools to get them up and running quickly,” said Navan Expense CEO Michael Sindicich. “With Rho, Navan customers now have an out-of-box set of financial tools from a trusted financial partner to help them proactively control spend as they scale while increasing operational efficiencies so companies can focus on the objectives that matter most.”
Ireland-based digital banking and payment solutions provider CR2 has agreed to be acquired by Morocco-based Hightech Payment Systems (HPS).
The transaction will strengthen HPS’s value proposition in French-speaking markets in Africa and help the company expand into English-speaking Africa and Australia.
CR2 made its Finovate debut at FinovateFall 2014 in New York.
Irish digital banking and payment solutions provider CR2 has agreed to be acquired by Morocco’s Hightech Payment Systems (HPS). The move will bolster HPS’s digital banking and payment capabilities and consolidate the company’s status as a leader in the African market, especially in its Francophone regions. The acquisition also will help HPS expand in English-speaking Africa and Australia due to CR2’s strength in these markets. Terms of the acquisition were not immediately available.
“We are pleased to be joining Abdeslam and the team at HPS,” CR2 CEO Fintan Byrne said in a statement. “Together, we share a wealth of experience, a passion for innovation, and a relentless focus on customer success.” Byrne added that the acquisition aligns with CR2’s global expansion goals. “With additional scale comes even more opportunity to invest and innovate. This is an exciting time to be in the digital banking and payments technology sector,” Byrne said.
A Finovate alum for more than a decade, CR2 offers digital banking and payment solutions via its flagship platform, BankWorld. The platform gives more than 90 banks in 50+ countries a comprehensive suite of digital banking, digital wallet, and payment functionalities. HPS will combine CR2’s technology with its PowerCARD suite of payment solutions which is used by 500+ institutions in more than 95 countries. HPS further noted that CR2 will “contribute materially” to its financial bottom line, post-acquisition. CR2 generated revenues of €23.8 million in the 12 months leading up to June 2023.
“Today marks a significant milestone in the continued growth of HPS,” HPS Co-Founder and CEO Abdeslam Alaoui Smaili said. “CR2 has a differentiated and exciting capability set, which is a strong fit for HPS and adds significant depth and breadth to our platform.”
Founded in 1995, HPS is a multinational corporation that provides payment software and solutions for issuers, acquirers, card processors, independent sales organizations (ISOs), retailers, mobile network operators (MNOs), and more. HPS is headquartered in Casablanca, Morocco, and has been a member of the Casablanca Stock Exchange since 2006.
Headquartered in Dublin, Ireland, with offices in Dubai, Jordan, India, and Australia, CR2 most recently demonstrated its technology at FinovateFall 2014 in New York. Earlier this year, the company announced a strategic partnership with U.K.-based core banking and financial solutions provider Fimple.
With neobank Monzo’s big investment and multi-billion dollar valuation on one side and the continued woes of BaaS provider Synapse on the other, “interesting times” continue to characterize the fintech landscape as we slide into the summer months.
Be sure to check our Fintech Rundown all week long for the latest updates and fintech headlines.
Insurtech
Indian insurtech CoverSureraises $4 million in pre-Series A funding in a round led by Enam Holdings.
The demos are done. The votes have been counted. And the people have spoken. After two days of live fintech demos here at FinovateSpring 2024, we are proud to introduce the winners of Best of Show.
Bloom Credit for its technology that helps banks and credit unions offer a deposit retention and credit building tool to their client base.
Cascading AI for its platform that improves efficiency in banks by 30x by automating rote tasks, enabling banks to leverage that step-change in efficiency to grow their top and bottom lines.
Kobalt Labs for its solution that helps fintechs and financial institutions accelerate and strengthen their third-party diligence, leading to faster and safer paths to revenue-generating partnerships and operational efficiency that doesn’t increase headcount.
QuickFi for its technology that enables banks and manufacturers to give their business customers a fully digital, self-service finance experience that’s fast, intuitive, and consistent with how modern business borrowers prefer to do business.
Remynt for its platform that helps creditors achieve higher recoveries and recapture defaulted consumers as customers when their financial position improves.
SAVVI AI for its solution that helps financial services companies step into the age of AI, with faster, more accurate forecasting, without changing their workflow or processes and using their existing teams.
A heartfelt thanks to all of our demoing companies for sharing their latest fintech innovations with our FinovateSpring audience. Be sure to check out the Finovate Podcast featuring Greg Palmer in the weeks to come as he interviews FinovateSpring 2024’s Best of Show winners.
Notes on methodology:
1. Only audience members NOT associated with demoing companies were eligible to vote. Finovate employees did not vote.
2. Attendees were encouraged to note their favorites during each day. At the end of the last demo, they chose their three favorites.
3. The exact written instructions given to attendees: “Please rate (the companies) on the basis of demo quality and potential impact of the innovation demoed.”
4. The six companies appearing on the highest percentage of submitted ballots were named “Best of Show.”
5. Go here for a list of previous Best of Show winners through 2014. Best of Show winners from our 2015 through 2024 conferences are below:
Aeropay raised $20 million in new funding for its pay-by-bank technology.
The round, which boosts Aeropay’s total funding to $25 million, was led by Group 11.
Aeropay also announced the launch of Aerosync, the company’s internally developed bank aggregator.
Chicago-based payments company Aeropayannounced today it has landed $20 million in new funding. The Series B round, which boosts the company’s total funds to $25 million, was led by venture capital firm Group 11 and saw participation from Chicago Ventures and Continental Investment Partners.
Aeropay was founded in 2017 to help businesses move money in a faster, less expensive way using Aerosync, the company’s internally developed pay-by-bank technology. Launching today, Aerosync is Aeropay’s bank aggregator that enables customizable integrations via open APIs.
“Payments in most verticals operate on archaic systems filled with excessive fees and risks,” said Aeropay Founder and CEO Daniel Muller. “We’ve built a bank-driven payments network that protects businesses against fraud, saves them money, and gives their customers an easy way to pay. Put simply, we are building the next-generation payments network.”
Aeropay will use the funds to expand into new markets, including financial services, wellness, utilities, QSR, and property management. The investment will also help fuel new product offerings, build on strategic partnerships, and explore new opportunities.
“For years, we’ve searched for a company advanced enough to solve the pains and inefficiencies of the card payment market, arguably the last bastion of the traditional financial services industry,” said Group 11 Founding Partner Dovi Frances. “Aeropay has tackled the most complex technological and compliance challenges, making them the most likely player to seize upon this massive addressable market.”
Pay-by-bank has seen rising popularity across the globe in the past few years, as open banking fuels new possibilities. The technology holds the promise of reducing transaction fees for retailers. End consumers, however, may remain skeptical of pay-by-bank’s security and user friendliness.
VantageScore launched its newest credit scoring model, the VantageScore 4plus.
The score combines consumer-permissioned open banking data with data from Experian, Equifax, or TransUnion to improve lenders’ underwriting efforts.
The new credit scoring model is available as a pilot for banks, fintechs, and government lenders.
Consumer credit score software company VantageScore unveiled VantageScore 4plus, its newest credit scoring model, today.
VantageScore 4plus leverages alternative data sourced through open banking that can be accessed via all major aggregator APIs. When consumers offer lenders access to their bank data, the lender can combine the data with traditional credit scoring information from Experian, Equifax, or TransUnion to make more informed underwriting decisions and potentially lend to more consumers who have thin credit files but demonstrate positive cash management.
“The use of consumer-permissioned bank account data is a huge step forward in creating a credit score that is more predictive and reflective of a consumer’s full financial profile, helping them build their credit and gain access to mainstream financial products,” said Credit Builders Alliance CEO Dara Duguay.
This new credit scoring model is available as a pilot for banks, fintechs, and government lenders. Because it uses the same 300 to 850 scoring range with aligned score-to-odds ratios as VantageScore 4.0, most lenders won’t need to adjust their credit or lending policies to use the new VantageScore 4plus credit score. And because the new score leverages real-time data, lenders will be able to view a consumer’s credit score adjustment within seconds, facilitating faster lending decisions.
The additional data from VantageScore 4plus not only helps lenders make informed decisions about new borrowers, but it also helps lenders identify existing borrowers whose habits have changed. The new score provides visibility into signs of financial distress months before the trouble is detected by traditional credit bureaus. which is critical in the current economic uncertainty.
“By harnessing the power of alternative open banking data, VantageScore 4plus is ushering in a new era of consumer credit scoring that is transformational for lenders,” said VantageScore President and CEO Silvio Tavares. “As the fastest growing credit scoring company in the U.S., with over 42% growth in 2023 and 27 billion credit scores used per year, lenders are recognizing the innovation and predictive power of VantageScore credit scores.”
The news comes shortly after Experian launchedCashflow Attributes, a tool also powered by open banking and consumer-permissioned data, that aims to offer lenders more data about underserved consumers.
Connecticut-based VantageScore was founded in 2006 as an independently managed joint venture of the U.S.’ three Nationwide Consumer Reporting Agencies (NCRAs) – Equifax, Experian and TransUnion. The company, which is committed to financial inclusion, saw the usage of its VantageScore increase by 42% in 2023, when it reported more than 27 billion credit scores. VantageScore helps 3,400+ institutions, including eight of the top 10 banks, to use the VantageScore credit score to underwrite credit cards, auto loans, personal loans, and mortgages.
Finovate’s David Penn interviewed Rikard Bandebo, VantageScore Executive Vice President and Chief Product Officer on the company’s approach to credit scoring in 2022.
Digital identity verification innovator Socure announced a partnership with identity-secured transactions company Proof.
The partnership will combine Proof’s Defend solution with Socure’s Sigma Fraud suite to help companies fight fraud and forgery in authorizations, agreements, contracts, and forms.
Founded in 2012, Socure made its Finovate debut the following year at FinovateFall in New York.
A new partnership between digital identity verification innovator Socure and identity-secured transactions company Proof will bring new tools to the fight against fraud and forgery in authorizations, contracts, and forms.
“With the explosion of new fraud vectors, our mission at Socure remains steadfast: use AI to deliver the most accurate anti-fraud and identity verification solutions in the industry,” Socure Founder and CEO Johnny Ayers said. “Partnering with Proof allows us to uniquely ensure identity-assured transactions for contracts, authorizations, forms, and high-risk financial events across various sectors.”
While there is widespread understanding about threats like money laundering that cost businesses $18 billion every year, the challenge from document fraud is significantly greater. A 2021 report from FINCEN revealed that false records and forgery are responsible for more than $45 billion in fraud activity annually. Fraudsters also have become more effective at leveraging AI to deploy deepfakes, synthetic identities, and – in the case of document fraud – falsified records.
The partnership will blend the strengths of Proof’s Defend solution with Socure’s Sigma Fraud suite. Defend leverages 100+ behavioral, fraud risk signals to detect fraud in online customer interactions. Businesses get a risk score for every transaction that highlights any fraud issues behind the authorization, signature, notarization, or identity verification.
Sigma Fraud analyzes historic behavioral patterns across channels to spot anomalies that may indicate fraudulent activity at the identity level. The suite also is backed by consortium data from the Socure Risk Insights Network, which draws from nearly 2,400 customers from the country’s largest banks, fintechs, payment platforms, and payroll providers.
“Adding Socure’s digital identity verification capabilities to Defend, our fraud detection and prevention product, allows customers to secure transactions at every stage, quickly and accurately,” Proof CEO Pat Kinsel said. “We can’t think of a better partner and are excited to introduce Socure to Defend clients.”
Founded in 2012, Socure made its Finovate debut at FinovateFall a year later. Most recently demoing its technology on the Finovate stage in 2017, Socure has since grown into a leader in digital identity verification with more than 2,300 customers. Last month, the company unveiled its new global watchlist screening and monitoring tool. The solution gives financial institutions the ability to screen, monitor, and assess new and existing customers against the Office of Foreign Assets Control (OFAC) sanction lists and politically exposed persons (PEP) databases, adverse media, and custom watchlists.
Socure began the year announcing a pair of new partnerships. In January, the company reported that auto finance company Exeter Finance would deploy the Socure ID+ platform to onboard new customers. In February, Socure teamed up with fellow Finovate alum Trustly to offer a Pay-by-Bank solution with streamlined onboarding.
