• Cybersecurity company VU and digital payments solutions innovator NovoPayment announced a strategic partnership today.
• The alliance will make VU’s fraud protection technology available to users of NovoPayment’s banking-as-a-service platform.
• Headquartered in Miami, Florida, NovoPayment was co-founded by CEO Anabel Pérez in 2007.

Cybersecurity firm VU will join the 60-partner application network of digital payments solutions company NovoPayment. Headquartered in Miami, Florida, NovoPayment offers a banking-as-a-service platform that leverages its network of open APIs, partnerships, and third-party integration to help its customers scale and adapt.

“Collaborating with NovoPayment allows us to expand our vision and address new challenges in the field of cybersecurity in the financial sector,” VU founder and CEO Sebastián Stranieri said. “Together we are committed to generating a positive impact by creating digital solutions to improve the quality of life for citizens and organizations.”

NovoPayment offers services within three principal categories: digital banking, payment infrastructure, and card solutions. The company helps its clients enhance their existing systems to generate new deposits, transaction streams, and customer experiences. In addition to its Miami HQ, NovoPayment maintains offices in Mexico, Colombia, Peru, Chile, and Ecuador, enabling the company to serve a range of customers across the Americas. The company’s clients include financial institutions and acquirers, as well as neobanks and fintechs.

“This alliance will enable us to enhance our payment solutions, providing users with an even safer and more reliable experience,” NovoPayment CEO and co-founder Anabel Pérez said. “We are excited to work with VU, a leader in cybersecurity, to ensure the peace of mind of our clients in the digital world.”

NovoPayment’s partnership with VU comes a little over a month after the company unveiled enhancements to its Orchestra technology. Orchestra is an advanced, cloud-based middleware orchestration layer of its BaaS platform. The technology helps financial institutions modernize their infrastructure and now features enhancements that add capabilities and new API-based use cases. Perez called Orchestra “a streamlined, convenient way to unify user experiences and fast-track innovation while ensuring compliance.”

Earlier this year, NovoPayment and Forrester Research published research on digitization trends at smaller banks and credit unions. In the report, the authors highlighted the compatibility with existing infrastructure as a major hurdle for digitization. Another challenge was the lack of staff to support customer-service based digital strategies. The report concluded that strategic partnerships can help smaller FIs bridge the gap between themselves and their larger competitors.

Perez and Oscar Garcia Mendoza founded NovoPayment in 2007. The company raised $19 million in Series A funding last spring.

Photo by Tory Brown

• New York-based digital mortgage lender Better.com is going public.
• The company will combine with Auora Acquisition Corporation via SPAC “on or about August 22.”
• The transaction between Better and Aurora has been more than two years in the making. The companies first announced the deal in May 2021.

Time to party like its 2021? The week begins with news that digital mortgage lender Better.com’s proposal to combine with Aurora Acquisition Corporation via SPAC has secured shareholder approval. The new Better.com will go public “on or about August 22, 2023.”

When finalized, the transaction will provide the combined entity with a minimum of $550 million and as much as $750 million in new capital. The company will trade on the NASDAQ under the tickers “BETR” and “BETRW.”

Founded in 2014 by CEO Vishal Garg, Better has been trying to close its SPAC deal for years. The transaction had been extended three times since 2021, amid concerns over market conditions, financial losses, and regulatory controversies. Among the bad press Better.com dealt with during this stretch was the infamous Zoom meeting in December 2021 during which Garg announced a layoff of approximately 900 employees. The CEO and founder also allegedly admitted that the company has “probably pissed away $200 million.”

With regard to finances, Better.com reported a net loss of $888.8 million in 2022. In the first quarter of this year, the company acknowledged losses of $89.9 million. Better.com also reported a decline in the number of loans funded year-over-year. The firm funded 18,559 loans in Q1 of 2022. Better.com funded 2,347 loans in the first quarter of this year.

In one response to these challenges, the company has made significant changes to its real estate strategy. Better.com announced in June that it would begin partnering with outside agents as referral partners in its Better Real Estate subsidiary. This pivot away from in-house licensed real estate teams to this new model is designed to help the subsidiary lower costs. The company also indicated that the change will help it deal with the challenge of lower mortgage volumes. Better Real Estate, which receives a significant number of its leads from its parent company’s mortgage operation, provided Better.com with $23.1 million in revenue in 2022.

Better has also introduced new solutions along its main line of business. The company began the year with the launch of One Day Mortgage. The new offering f gives borrowers a mortgage commitment letter within 24 hours of applying for a loan.

Photo by Suzy Hazelwood

• Sila launched Instant Settlement this week.
• The new tool offers customers real-time access to ACH debits made on the Sila platform.
• Instant Settlement works with all ACH transactions on the Sila platform and doesn’t require banks to adopt a particular payment rail.

Banking and payment infrastructure-as-a-service company Sila is launching a new product called Instant Settlement this week. The solution offers customers real-time access to ACH debits made with the Sila platform.

As its name suggests, Sila’s new tool offers companies access to funds instantly, without needing to wait the traditional two-to-five day time period of the ACH settlement to clear. Without the need to wait for funds to clear, companies no longer need to pre-fund transactions or rely on their own capital.

With Instant Settlement, Sila pre-funds the consumer’s digital wallet within a matter of seconds. The company’s approach works with all ACH transactions on the Sila platform because it doesn’t rely on any particular payment rail.

“With Instant Settlement, we are revolutionizing the way businesses and individuals access and manage their funds,” said Sila Co-Founder & Chief Strategy Officer Shamir Karkal. “We understand the importance of transaction speed in today’s fast-paced business landscape, and by offering Instant Settlement, we are providing our customers with a competitive advantage that sets them apart in their respective industries.”

Sila notes that Instant Settlement works best in situations such as payroll processing, back-office money movements, B2B transactions, and physical cash transactions where ACH is preferred, but return risks are low. That’s because it requires customers to maintain sufficient funds in a reserve wallet to cover potential return risks.

The timing of today’s release is notable as it comes shortly after the launch of the U.S. Federal Reserve’s launch of FedNow real-time payments system. Sila differentiates itself from FedNow and other real-time payments companies such as RTP because it doesn’t require banks to adopt a specific rail. “While everyone is rushing to RTP (65% coverage) and FedNow both of those instant payment systems are limited by the number of banks that adopt a particular instant payment rail while Sila’s Instant Settlement doesn’t rely on banks to adopt anything and instead, it is applicable to 100% of ACH transactions on its platform,” the company explained.

Sila was founded in 2018 by Karkal, who was one of the entrepreneurs who co-founded challenger bank Simple in 2009. The Oregon-based company has gone on to raise $20.7 million.

Photo by Ivan Samkov