Daily news

Plaid and Square Team Up to Improve the ACH Payments Experience

Plaid and Square Team Up to Improve the ACH Payments Experience
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, Plaid

Two fintech megaliths, financial data and infrastructure platform Plaid and merchant services company Square formed a partnership this week that will offer merchants a smoother experience when it comes to ACH payments.

Through the deal, U.S. merchants can process ACH payments without storing clients’ bank account information. Square is leveraging a tokenized check system that uses Plaid to help customers connect their bank accounts. Plaid enables customers to enter their bank login credentials to connect their account and enable the payment.

This system works especially well for businesses that take payments for high-value orders. That’s because it increases the certainty that they payment will go through. Making acceptance even easier, Square offers fee-free refunds on ACH payments processed.

“Payment flexibility, security, and transparency are core to Square’s Payment Platform,” said the Head of Square’s Payment Platform Dennis Jarosch. “By offering ACH payments, we can help businesses process large transactions online at a low cost without worrying about bank authentication, compliance, or any managed payment complexities. We’re excited to offer ACH as one of many ways that businesses get paid fast and securely with Square.”

For Plaid, this news comes shortly after the company closed a $425 million round of funding. Plaid was founded in 2012 to build APIs to connect consumers, financial institutions, and developers. Today, the company also offers a suite of analytics products that provides further insights into transactions.

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nCino Collaborates with KPMG Australia to Boost Middle and Back Office Performance

nCino Collaborates with KPMG Australia to Boost Middle and Back Office Performance
By David Penn Posted on
Categories: Alumni News, Daily news, nCino

nCino will bring its cloud-based Bank Operating System to the Land Down Under to help KPMG Australia improve its middle and back office operations for its bank clients.

“nCino has a proven track record of helping financial institutions innovate while optimizing their processes,” nCino Director of Strategic Partnerships in APAC Zameer Momin said. “As more and more financial institutions are embarking on their business transformations, we are truly excited to be able to offer the power of KPMG Australia’s banking operations knowledge with nCino’s cloud technology to help create a robust and scalable digital experience.”

nCino’s Bank Operating System leverages the Salesforce platform to offer financial institutions a complete, end-to-end banking solution. nCino’s technology integrates with the institution’s core systems, and combines CRM, onboarding, account opening, loan origination, deposit accounts, credit analysis, ECM, and instant reporting capabilities. nCino notes that its client institutions have experienced a 92% reduction in servicing costs, a 54% reduction in policy exceptions, a 40% decrease in loan closing time, and a 22% increase in efficiency using its cloud-based Bank Operating Systems. These FIs have also experienced a 1.2x increase in account opening completion rates.

KPMG Australia Partner Alex Moreno pointed to the changing nature of the financial services landscape in Australia – including the arrival of both new digital competitors and increased regulation – as reasons for the collaboration with nCino. “Customers are expecting a better experience from their bank,” Moreno said. “Most banks have challenges with operational efficiency and internal time to competency, and secure and responsible lending is in the spotlight. The combination of KPMG’s Banking Operational Excellence Practice and nCino’s Bank Operating System is well positioned to help navigate these challenges.”

A Finovate alum since 2017, nCino began 2021 by announcing new partnerships with Platinum Bank ($425 million in assets) headquartered in Minnesota, and the National Bank of Canada ($332 billion in assets). More recently, nCino brought its technology to Hamburg Commercial Bank and Boston Private, and also worked with Coast Capital and Amerant Bank to expand their use of nCino’s solutions.

Headquartered in Wilmington, North Carolina, nCino was founded in 2012. The company, which went public last July, trades on the NASDAQ under the ticker NCNO and has a valuation of $5.4 billion.

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Privacy.com Rebrands to Lithic, Closes $43 Million in Series B Round

Privacy.com Rebrands to Lithic, Closes $43 Million in Series B Round
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news

Privacy.com has a new name and new funding this week. The card issuing platform has rebranded to Lithic and raised $43 million in Series B funding. This brings the company’s total funding to $61 million. The investment was led by Bessemer Venture Partners and saw participation from Index Ventures, Tusk Venture Partners, Rainfall Ventures, Teamworthy Ventures, and Walkabout Ventures.

The company initially launched as Privacy.com, a consumer-facing platform that offers tools to help shoppers generate virtual “burner cards,” which are single-use, disposable card numbers that shoppers could use to shield their actual card number. Going forward, Lithic will maintain this consumer-facing product under the Privacy.com brand.

Last fall, Lithic unveiled its card issuing API for developers. In the past four months, the company has seen impressive growth, with enterprise issuing volumes ballooning by 3x. Lithic will use today’s funding to fuel that growth even further.

The developer-facing tools help them create payment cards for their customers, optimize back-office operations, and simplify disbursements. These capabilities help developers issue a card instantly, reduce administrative burden, and earn a percentage of the interchange revenue.

“We built all these foundational card processing tools for ourselves to power Privacy.com,” said Lithic CEO and Co-founder Bo Jiang. “Then we found that other companies, especially developers, needed the same types of tools. The more we thought about it, the more it made sense to give these tools their own name—Lithic. Its own business, with its own separate customers and its own mission.”

Founded in 2014 by Bo Jiang, Jason Kruse, and David Nicholsand, Lithic is headquartered in New York City.

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Ping Identity and ProofID Bring Identity Security to Tesco Bank

Ping Identity and ProofID Bring Identity Security to Tesco Bank
By David Penn Posted on
Categories: Alumni News, Daily news, Ping Identity

A pair of identity solution providers – Ping Identity and ProofID – have partnered to enhance identity security for U.K.-based Tesco Bank.

The banking division of Tesco, the largest supermarket retailer in the U.K., Tesco Bank deployed both Ping Identity’s PingAccess and PingFederate to secure key applications. With ProofID as the bank’s implementation partner, the integration – which involved creating a single-factor login process deployed across a private AWS cloud – took only 12 weeks. Importantly, the solution “allow(ed) us to consolidate disparate identity data,” said Tesco Bank security architect David McConchie, “laying the foundation for a common customer identity.”

PingAccess is PingIdentity’s centralized cloud identity and access security solution for apps and APIs. The technology provides secure access down to the URL level and can secure APIs by applying policies to disallow specific HTTP transactions to users in untrusted contexts. PingFederate is an enterprise federation server that enables user authentication and single sign-on. The solution functions as a global authentication authority to enable authorized entities to securely access applications from any device.

“We saw how we could use PingAccess and PingFederate to work across web, mobile and API. The ease with which we could deploy across channels was a critical factor, along with the data governance capabilities,” McConchie said. “Ping Identity gives us the flexible authorization capabilities we need to minimize friction and deliver a customer-centric experience.”

A Finovate alum for nearly 10 years, Ping Identity was founded in 2003 and is headquartered in Denver, Colorado. Named a Top Workplace by The Denver Post earlier this month, Ping Identity partnered with global logistics provider DB Schenker in April, and launched its new, cloud-based identity verification service, PingOne Verify, in February.

Ping is publicly-traded on the New York Stock Exchange under the ticker PING. With a $1.2 billion valuation upon its IPO in September 2019, the company currently has a market capitalization of $1.9 billion. Andre Durand is founder and CEO.

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Ally Offers Point of Sale Financing with Sezzle

Ally Offers Point of Sale Financing with Sezzle
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, Sezzle

Ally Financial’s Ally Lending announced this week it is now offering financing on buy-now, pay-later (BNPL) platform Sezzle. The new collaboration enables select shoppers to pay for purchases over time using Ally’s installment loans or Sezzle’s BNPL installment offerings.

If a purchase is eligible for an installment loan from Ally, the shopper will see the message “financed by Ally” at checkout. Loans will be available for purchases of up to $40,000 with terms ranging from three to 60 months. This broadens the availability of financing typically available on Sezzle, which currently limits shoppers to four installments paid over the course of six weeks on purchases up to $2,500.

“We’re on a mission to financially empower the next generation,” said Sezzle CEO Charlie Youakim. “With Ally Lending’s personalized, flexible financing solutions now available on our platform, we’re able to offer even more options for consumers to budget their purchases and responsibly pay for what they want and need.”

Today’s news comes during a time when both online shopping and BNPL are on the rise. Over the past year, BNPL increased 17% in Gen Z populations and 21% for millennials.

Sezzle initially went public on the ASX in July of 2019, and now has a market cap of over $777 million, a figure that is almost 5x higher than it was at the start of 2020. The company announced earlier this month it will IPO in the U.S. later this year.

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HSBC Launches Multi-Currency Digital Wallet

HSBC Launches Multi-Currency Digital Wallet
By Julie Muhn (@julieschicktanz) Posted on
Categories: Daily news, HSBC

Multi-currency accounts are expanding beyond the realm of fintechs.

This week, HSBC U.S. is launching a multi-currency digital wallet. The new offering, HSBC Global Wallet, will enable U.S. business banking users to exchange foreign currencies and make transactions across borders without using third party tools.

The wallet, which is also being rolled out in the U.K. and Singapore today, will be available in other markets starting next year.

HSBC Global Wallet will offer small-and-medium-sized businesses instant capability to pay in foreign currencies, including Euros, U.K. Pound Sterling, Hong Kong Dollars, Canadian Dollars, Singapore Dollars, Australian Dollars, and Malaysian Ringgit. As a result, these business users will have the ability to make international payments to the U.K., Canada, Hong Kong, Singapore, Australia, Malaysia and 19 markets in the Eurozone using domestic real-time payment networks. The ability for businesses to receive these local currencies will be available later this year.

“We are excited that the U.S. is one of the first markets in which we are launching HSBC Global Wallet,” said HSBC Head of Liquidity & Cash Management, U.S. and Canada Drew Douglas. “We are excited for the launch and looking forward to expanding the breadth of currencies as we move forward and to introducing receive ‘like a local’ functionality in the very near future.”

Today’s news follows the launch of HSBC’s Global Money account in November of last year. Based on a similar concept, the Global Money multi-currency account enables the bank’s retail banking customers to convert, hold, and transfer multiple currencies from one account. Users can hold up to eight currencies at once and can send money instantly to other HSBC accountholders in more than 15 countries for free.

While the launch of a multi-currency account is a win for HSBC in today’s global economy, there is still one element notably missing– cryptocurrency. The multi-currency accounts that fintechs such as Revolut offer enable users to buy, sell, and hold multiple cryptocurrencies. While HSBC said it has “a pipeline of new currencies and enhancements,” the bank made no mention of future cryptocurrency plans.

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Transaction Security Specialist ThetaRay Scores $31 Million in New Funding

Transaction Security Specialist ThetaRay Scores $31 Million in New Funding
By David Penn Posted on
Categories: Alumni News, Daily news, Finovate Global, Funding, ThetaRay

In a round featuring new investors Saints Fund and Eric Benhamou of Benhamou Global Ventures, cross-border transaction monitoring solution provider ThetaRay has raised $31 million in new funding. Led by JVP and BGV Funds, the investment round also featured participation from current investors OurCrowd, Bank Hapoalim, SBT, and others. The funding takes the Israel-based company’s total capital to more than $90 million and will be used to help ThetaRay bring its cloud-based, transaction monitoring solution to new markets.

“We are on the verge of a real revolution in securing the global financial system,” ThetaRay CEO Mark Gazit said. “During this period, when the cross-border payment network has become the lifeblood of the world trade infrastructure, ThetaRay is here to instill certainty and reduce risks in secure, cross-border payments.”

ThetaRay’s announcement comes as the governments of both Nigeria and the Ukraine have implemented ThetaRay’s technology to protect cross-border payments from financial crime. The cross-border payments market, estimated at $25 trillion a year, increasingly has been targeted by financial criminals in the post-COVID environment. Unfortunately, the response to this threat has involved tightened controls and enforcement that have resulted in challenges – from slow service to outright blockages – for many of those businesses and banks that need to make legitimate cross-border payments.

To this end, ThetaRay’s SaaS offering analyzes SWIFT traffic, risk indicators, and data from clients, payers, and payees to spot patterns and anomalies that are indicative of suspicious activity – including money laundering and terrorist financing. The technology leverages a proprietary approach to machine learning called “artificial intuition” which simulates the decision-making aptitude of human instinct and subjectivity. Referred to as the “fourth generation of AI,” artificial intuition is being applied to help financial institutions spot large-scale, more sophisticated cybercrime strategies by analyzing the various parameters of the massive number of individual transactions that may make up a given fraud attempt.

“This revolution will enable many organizations and people around the world to transfer money faster, more securely, and with far fewer fees and stops along the way,” JVP founder and chairman Erel Margalit said. “What Swift did to the banking world 25 years ago, ThetaRay will do to the banking world in the next ten years.”

Founded in 2013 and making its Finovate debut two years later at FinovateFall, ThetaRay launched its cloud-based, anti-money laundering (AML) solution for cross-border payments last month. Also in April, the company appointed former Fundtech/Finastra Payments executive Dagan Osovlansky as its new Chief Product Officer. ThetaRay also won the Transaction Security Innovation Award this spring from the FinTech Breakthrough Awards program.

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Temenos Offers Digital Asset Access for Banks

Temenos Offers Digital Asset Access for Banks
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, Temenos

Switzerland-based banking technology provider Temenos partnered with digital assets platform Taurus this week. Through the partnership, Temenos integrated Taurus’ digital asset and blockchain infrastructure with Temenos Transact, the company’s core banking software.

As a result, Temenos’ 3,000 bank and FI clients across the globe will have access to digital assets. Taurus will enable them to integrate and manage any digital asset, traditional securities, and cash.

“Investors are increasingly aware of the performance of cryptocurrencies, which can effectively participate in the diversification of a portfolio,” said Temenos Product Director Alexandre Duret. “Taurus is leading the field in cryptography and blockchain technology. By joining forces, we can help banks to bridge the gap between traditional investments and digital assets.”

With its securities firm license from the Swiss Financial Market Supervisory Authority, Taurus can cover digital currencies, cryptocurrencies, as well as tokenized assets. The company offers three main products: Taurus-CAPITAL for tokenization and lifecycle management, Taurus-PROTECT for hot, warm, and cold digital asset custody, and Taurus-EXPLORER an API-based blockchain connectivity to more than 10 blockchain protocols.

Temenos has added Taurus’ tools to the Temenos Marketplace, a partner ecosystem of 50+ fintech solutions. All tools in the MarketPlace are pre-integrated for fast implementation.

Founded in 1993, Temenos is a public company, listed on the SIX Swiss Exchange under the ticker TEMN. The company has a market capitalization of $9.84 billion.

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PayPal’s Newest Acquisition is a Move Toward a Next-Generation Digital Wallet

PayPal’s Newest Acquisition is a Move Toward a Next-Generation Digital Wallet
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, Mergers & Acquisitions, PayPal

U.S. payments platform PayPal has been slowly inching toward becoming a super app in the past few years. Today’s news that the California-based company has acquired Happy Returns indicates a step further toward that goal.

Terms of the deal are undisclosed.

“The post-purchase experience is something we’ve been looking into, since it’s such a pain point — people want to shop online and return in store, and vice versa,” PayPal SVP of Consumer In-Store and Digital Commerce Frank Keller told CNBC in an interview. “For retailers, we’re providing more comprehensive services beyond payments.”

Happy Returns launched in 2015 to provide box-free, in-person returns for online orders. The company sees the benefits as three-fold– it makes for a better customer experience, it is less expensive for the merchant, and is less wasteful and therefore better for the environment.

Consumers making purchases at one of Happy Returns’ hundreds of brand partners can use the company’s software to make returns at 2,600+ drop-off locations in 1,200+ cities across every U.S. state.

What started as PayPal’s flagship payments platform expanded to encompass the pre-purchase shopping experience when the company acquired Honey in 2019. Today, with the addition of Happy Returns, PayPal adds another element to serve the post-shopping experience to its already robust platform.

This holistic shopping experience is in line with PayPal CEO Dan Schulman’s plan for the company. Schulman recently announced PayPal will roll out a “next-generation” digital wallet that will offer a personalized shopping, financial services, and payments experience.

Photo by Nick Fewings on Unsplash

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Online Fraud Prevention Specialist Arkose Labs Secures $70 Million

Online Fraud Prevention Specialist Arkose Labs Secures $70 Million
By David Penn Posted on
Categories: Alumni News, Arkose Labs, Daily news, Funding

In a round led by SoftBank Vision Fund 2, online fraud and abuse prevention specialist Arkose Labs has raised $70 million in Series C funding. The San Francisco, California-based company will use the additional capital to support platform development, hire new talent, and fuel global expansion.

This week’s investment takes Arkose Labs’ total capital to $114 million. Also participating in the financing were Wells Fargo Strategic Capital and existing investors M12 and PayPal Ventures.

“With Masa and the team at Softbank, we have a partner who matches our ambition for eradicating fraud online by means of disrupting the economic ROI for bad actors,” Arkose Labs founder and CEO Kevin Gosschalk said. “At Arkose Labs, we are building a portfolio of capabilities that can adapt and respond based on the fraudsters’ techniques to ensure we are maximizing the impact to them whilst minimizing any form of friction to good users.”

A Best of Show winner in its Finovate debut at FinovateSpring in 2019, Arkose Labs specializes in defending neobanks, ecommerce companies, payment firms, insurers, and other businesses against a range of cybercrimes including account takeover and both payment and new account fraud. Founded in 2015, Arkose Labs offers an authentication platform that invisibly identifies the context, behavior, and past reputation of a each request, classifying it as Authentic or Inauthentic. Authentic requests are passed on to the enterprise, while Inauthentic requests are remediated by dynamic defenses that generate continuous losses.

This is part of the company’s strategy, articulated by Gosschalk at FinovateSpring, to “break hacker economics by making it more expensive for the bad guys to get in than the data they are getting out.” He added “if you do that, they give up and move on.”

In its funding announcement, Arkose Labs highlighted a number of key milestones the company has met since its last funding – a $22 million Series B round – in March of 2020. These accomplishments include analyzing more than 15 billion online sessions last year, stopping more than four billion attacks; the opening of regional EMEA headquarters in London and a doubling of the company’s workforce. Arkose Labs also announced a number of C-suite hires over the past year, including a new Chief Operating and Financial Officer, a new Chief Product Officer, and a new Chief Security Officer and VP of Information Technology. The company also pledged to make additional hires this year to lead operations in North America, Australia, and Europe.

“With Arkose Labs’ successful expansion in the financial services industry, this signifies a continued digital shift in banking,” Gosschalk said. “(It) requires a customer-centric approach that kicks the bad guys out of online operations, while maintaining the highest levels of convenience and usability that financial services operations require.”

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W.UP Launches Money Stories to Win Consumers’ Divided Attention

W.UP Launches Money Stories to Win Consumers’ Divided Attention
By Julie Muhn (@julieschicktanz) Posted on
Categories: Alumni News, Daily news, W.UP

Customer-focused banking tools provider W.UP revealed its latest development today. The Hungary-based company is launching Money Stories.

The new embeddable tool enables banks to offer their customers bite-sized snapshots of their financial lives. These easily consumable bits of content combine data analytics with digital storytelling to make it even easier for banks to help users to understand their financial standing in a fast-paced way.

The new tool takes the concept from millennial-friendly mobile apps such as Snapchat, Instagram, Facebook, and Twitter. Each of these social media platforms are notorious for enabling users to quickly publish and view life updates and ideas, share new songs, and even exchange gossip. The micro-content requires little attention from viewers, who are easily distracted and prone to multi-tasking.

Similarly, Money Stories leverages transactional and behavioral analytics to show users daily highlights, weekly and monthly forecasts, and yearly summaries. Overall, these updates take the form of unusually large transactions, double charges, sharp balance drops, recurring transitions, top spending categories, changes in spending or credit card usage, and more. In addition to showing users their historical data, Money Stories can also help users plan for the future by showing options to pay off credit card debt, avoid overdrafts, and more.

All of the graphics appear on a single screen for seven-to-ten seconds, so the user does not need to scroll or set aside much time in their day to understand the analyses.

W.UP is keeping the integration easy for banks. “When all is said and done, the only decision for banks to make remains what product and service offers to slide into the story stream to boost targeting accuracy, conversion, and customer satisfaction levels,” said W.UP Head of Product Gellért Vinnai.

Founded in 2014, W.UP takes PFM to a personalized level by leveraging AI and real-time data. These product offerings have obviously struck a chord in the banking crowd; the company has won Best of Show awards at FinovateEurope 2018, 2019, and most recently for its demo in 2020.

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Lili Locks in $55 Million to Bring Banking to Gig Economy Workers

Lili Locks in $55 Million to Bring Banking to Gig Economy Workers
By David Penn Posted on
Categories: Daily news, Funding

In a round led by Group 11, banking app Lili has secured $55 million in Series B funding. The capital will help the New York-based fintech grow its product range over the next few months. This will include the addition of new features for invoice and payment management and a new loans product.

“We’ve created the tools you need to spend more time building your venture and less time on things that historically your employer would handle: sorting expenses, managing financials, and filing taxes,” Lili CEO and co-founder Lilac Bar David explained.

The Series B took the two-year old company’s total capital to $80 million. Also participating in the investment were Target Global and AltaIR.

Having doubled its account base over the past six months and currently boasting 200,000 users, Lili offers real-time expense management, tax preparation, and no-fee accounts designed for freelancers and gig economy workers. Lili also provides direct deposit and a Visa business debit card with free ATM withdrawals at more than 32,000 locations.

Named to the Forbes Next 1000 list for 2021, Bar David co-founded Lili having spent three years as CEO of Israeli challenger bank, Pepper. Along with current Lili CTO and co-founder Liran Zelkha, Bar David’s goal was to build a solution for workers in the freelance economy that combined banking and business management services into a single platform. She estimated that Lili has saved its users 60 hours on administrative tasks and $1,700 a year in fees, costs, and tax savings.

The 60 million freelancers in the U.S. – more than a third of the workforce – often struggle to secure timely payment for services rendered, accurately meet tax obligations, and manage their overall financial work/life balance. With the expectation that this relatively young cohort will only grow in size over time, investors like Group 11 see Lili as well-positioned to take advantage of this evolution in the “future of work.”

“Lilac and Liran’s forward-looking vision is changing how modern workers manage their finances, while saving them valuable time and money,” Group 11 founding partner Dovi Frances said during the company’s seed funding round announcement just under a year ago. “Lili is redefining banking for freelancers and we’re thrilled to be partnering with the team.”

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