One of the more interesting questions during a recent FinovateWest Digital panel on challenger banks asked: how important are partnerships to these digital newcomers? This week, one answer to that question came in the form of an announcement from Australia’s self-described “smartbank” – 86 400 – that it was teaming up with one of the global leaders in data aggregation and insights: Envestnet | Yodlee.

“The average Australians’ financial world can be very complex, with numerous accounts for numerous products across different financial institutions,” 86 400 CIO Brian Parker explained. “By partnering with Envestnet | Yodlee, we’ve given our customers the ability to see all their accounts in one place, delivering a better view of their financial lives and helping them take control of their money.”

Founded in 2017 and backed by Cuscal, Australia’s largest independent payments company, 86 400 offers no fee banking; card, mobile, and smartwatch-based payments; and competitive interest rates for both savers and borrowers. Via mobile app, 86 400 customers can easily monitor and manage their finances, functionality that will be significantly enhanced via the smartbank’s new relationship with Envestnet | Yodlee.

“Consumers don’t have to wait for Open Banking to access and use their own data,” Envestnet | Yodlee ANZ Country Manager Tim Poskitt said. “Envestnet | Yodlee’s data aggregation enables consumers to link their financial accounts with tools and products that deliver better financial outcomes. That’s what 86 400’s products provide.”

86 400, which takes its name from the total number of seconds in a 24 hour day, has forged partnerships in recent months with mortgage brokers like Mortgage Choice and Connective. Headquartered in Sydney, New South Wales, 86 400 won Best in Class at Australia’s International Good Design Awards. Robert Bell is CEO.

Maybe it is true, as fintech observer and wit Ron Shevlin suggested on Twitter recently, that the credit card issuers have to be scratching their heads a bit with the sudden popularity of the Buy Now Pay Later ecommerce craze-turned-trend. But as Homer Simpson famously put it, “we’re not succumbing to mass hysteria. We’re just jumping on the bandwagon.”

The latest news from the BNPL bandwagon features U.S. buy now pay later company Affirm, which announced that it would acquire Canadian BNPL outfit PayBright for $264 million (C$340 million).

“We built PayBright with the mission of making the everyday commerce experience simply better for Canadians,” company President and CEO Wayne Pommen said. “Partnering with Affirm gives us the opportunity to deliver on that promise on a much larger scale.” Pommen added that he was “delighted” at the opportunity to take “Buy Now Pay Later to the next level in Canada.”

Just where is that next level? PayBright currently has more than 7,000 retailer partners around the world, including companies like Samsung, Wayfair, and Oakley. And competition in the Canadian BNPL space has intensified of late; Australian BNPL rival Afterpay announced its expansion to the country in August.

Here is our look at fintech around the world.

Latin America and the Caribbean

• BNamericas interviews Ruben Galindo, CEO of Mexican fintech CapitalTech on how the company has managed to serve its customers during the pandemic.
• A partnership between FacePhi and Peruvian fintech TuSueldoYa will help businesses better manage cash advances during the COVID-19 crisis.
• IBS Intelligence highlights four Mexican fintechs that are “transforming the financial sector”: Credijusto, Konfio, Clip, and Albo.

Asia-Pacific

• Lightnet, a Singapore-based company that leverages blockchain technology to power its remittance offering, announces partnership with Siam Commercial Bank.
• P2P lending marketplace Rai Capital goes live in Cambodia.
• The Philippine Central Bank recognizes digital banks as a new bank category as part of a new regulatory framework.

Sub-Saharan Africa

• A rare look at the evolving fintech ecocsystem in Cameroon.
• Telkom, a telecommunications company based in South Africa, goes live with its digital wallet that enables WhatsApp based P2P mobile payments.
• Nigerian payment infrastructure solution provider Airopay introduces a new digital payment app.

Central and Eastern Europe

• Paysera expands to Albania, opening offices in the capital city of Tirana.
• Polish fintech ZEN announces strategic partnership with Mastercard; goes live in 32 European markets.
• U.K.-based cashless payment solution provider DiPocket chooses Lithuania for its office in the CEE region.

Middle East and Northern Africa

• Emirates NBD introduces next-generation global corporate banking platform businessONLINE.
• New report highlights Riyadh and Bahrain among “top fintech ecosystems to watch.”
• Kuwait-based banking technology service provider VeriTech partners with Norway’s Zwipe to meet growing demand for contactless payments in the Middle East.

Central and Southern Asia

• India-based cryptocurrency investment platform CoinSwitch Kuber announces plans for early December launch.
• Fintech Futures takes a look at Indian challenger bank Finwego, which specializes in lending in the private school education space.
• Swedish biometric company Fingerprint Cards teams up with Indian smartcard manufacturer M-Tech Innovations to launch contactless cards in India.

Photo by Ben Mack from Pexels

The biggest news in global fintech this week was word that the much-anticipated Ant Group IPO, an initial public offering expected to raise $34.5 billion, had been suspended on both the Shanghai and Hong Kong stock exchanges. Why? According to reports from the Wall Street Journal, Chinese President Xi Jinping himself ordered a halt to the IPO in response to criticisms about Chinese government regulators from Ant Group founder Jack Ma.

Slated to be the biggest initial public offering in history, the Ant Group offering is currently suspended indefinitely by Chinese authorities, who cited “changes in the financial technology regulatory environment” as reasons why the financial tech giant’s online lending business “would face tighter government scrutiny.”

As the Wall Street Journal tells it, the sharp rebuke from Chinese authorities is the result of long-simmering concerns about the growing strength of Ant Group, whose financial division Alipay is used by approximately 70% of the Chinese population. Ma’s comments, which came in a speech delivered in late October, sought to elevate the role of innovation rather than personality in solving the country’s financial problems. However his remarks about the way financial regulations are impeding technological development apparently infuriated Chinese officials, who moved quickly to check the country’s richest and most well-known businessman.

Other Chinese fintechs and financial services companies would be well-advised to take note. Following up on the smack-down of Ant Group, the Vice Chair of the China Banking and Insurance Regulatory Commission (CBIRC) Liang Tao warned “we need to pay close attention to the risks from internet security, data protection, and market monopoly.” Pardon the editorial interjection, but I am quite ready to forgive anyone for feeling as if one of those issues – certainly given the Ant Group news this week – seems a bit out of place among the other two.

Here is our look at fintech around the world.

Middle East and Northern Africa

• Turkey’s Isbank completes second pilot cross border trade transaction using distributed ledger technology.
• Ripple names Dubai as the location of its regional headquarters.
• Lebanon’s central bank announces plans to debut a national digital currency next year.

Central and Southern Asia

• Digital-only YeLo Bank wins the Indian Finals of the AWS Startup Architecture Challenge of the Year 2020.
• Crowdfund Insider looks at how the Indian state of Gujarat is supporting the growth of local fintechs.
• Transfin founder and CEO Nikhil Arora talks with Madhusudanan R, co-founder of fintech API platform YAP on the evolution of fintech in India.

Latin America and the Caribbean

• Microsoft partners with Uruguay-based dLocal to boost access to emerging markets.
• Argentine online B2C travel agency Despegar to leverage its acquisition of Brazilian buy now pay later firm Koin to offer installment financing to travelers.
• Brazilian fintech Nubank pledges to support financial education for black Brazilians in the wake of controversial comments by co-founder Cristina Junqueira in a recent television interview.

Asia-Pacific

• Indonesian e-money institution LinkAja secures $100 million Series B led by Grab.
• Nikkei Asia profiles Siam Commercial Bank subsidiary SCB Abacus, which leveraged AI to delivery the country’s first fully digital lending platform using alternative data.
• A look at how fintech can enable communities in the Philippines to “navigate the new normal.”

Sub-Saharan Africa

• Kuda, a digital bank based in Nigeria, secures $10 million in seed funding.
• South African’s FinChatBot locks in $1.6 million in funding to fuel expansion to Europe and West Africa.
• Nigeria’s Paystack announces pilot phase of its payment solution in South Africa.

Central and Eastern Europe

• Elbrus Capital and Winter Capital announce investment in Russian financial marketplace, Banki.ru.
• Enterprise connectivity platform Yapily to expand to Germany.
• German fintech auxmoney secures investment from French bank BNP Paribas. The amount of the funding was not disclosed.

Photo by Lucas Pezeta from Pexels

The biggest news in international fintech was the $34.5 billion pricing of Ant Group’s upcoming initial public offering. We covered the news earlier this week. The company will be making a dual IPO, offering half of its shares on Hong Kong’s Hang Seng, and the other half on Shanghai’s Star Market. The date for the Hong Kong IPO has been set for next week, November 5th. No date has been determined for Ant Group’s IPO on the Shanghai-based exchange.

The $34.5 billion target would represent a new record, topping the $29.4 billion raised by Saudi Aramco earlier this year in its IPO. Ant Group anticipates earning a valuation of more than $313 billion. This amount would rival that of most of the biggest banks in the U.S., with the only exception being JP Morgan Chase with its market cap of $434 billion.

On the European fintech front, a handful of Finovate alums have made headlines this week. Account takeover prevention specialist SpyCloud announced a partnership with Southern European-based information security solutions value-added distributor, DotForce. U.K.-based Icon Solutions, a payments technology provider, picked up a strategic investment from JPMorgan. In the Americas, FIS teamed up with Brazilian financial services firm Afinz to help the company enhance its private-label credit card processing capabilities. Meanwhile to the north, Toronto, Ontario, Canada’s Finn AI inked a deal with Michigan-based United Federal Credit Union to bring conversational chat to the firm’s 200,000 members.

Here is our look at fintech around the world.

Central and Eastern Europe

• German business banking platform Penta partners with savings marketplace Raisin.
• Lithuanian government authorizes new Centre of Excellence in Anti-Money Laundering.
• German sharia-compliant banking app, insha, raises €2.5 million en route to planned U.K. launch.

Middle East and Northern Africa

• Bahrain-based open banking platform Tarabut Gateway launches in the UAE.
• Oman Banks Association urges lenders in the country to embrace fintech and open banking.
• Turkish fintech Payguru introduces new pay by text message service.

Central and Southern Asia

• Indian fintech GetVantage raises $5 million in seed funding.
• Smart Engines partners with Alfa Bank Kazakhstan to power digital onboarding and online payments.
• PhonePe, an online payments company based in India, announces availability as a payment option at more than two million locations in Maharashtra.

Latin America and the Caribbean

• Risk analytics software company Provenir partners with Mexico’s Estudia Mas to automate and digitize risk decisioning for education loans.
• Visa to acquire YellowPepper, a company that supports Latin American and Caribbean financial institutions and startups.
• Real-time financial data aggregator Afterbanks begins operations in Mexico.

Asia-Pacific

• Rapyd launches its “all-in-one” payment capabilities in South Korea courtesy of a partnership with local PSPs.
• Hong Kong-based virtual bank Mox onboards 35,000 customers in its first month of operation.
• TechinAsia looks at the “brutal” competition in the Vietnamese e-wallet market.

Sub-Saharan Africa

• Evolve Credit, a Nigerian loan and financial product marketplace, raises $25,000 in funding from Nigerian VC firm Microtraction.
• Fintech infrastructure platform Nium announces expansion into Africa.
• Two South African fintechs, B2B digital lender Lulalend and biometric digital identity company Paycode, earn recognition by the 2020 Inclusive Fintech Awards.

Photo by Poranimm Athithawatthee from Pexels

This week in Finovate Global we take a deep dive into the fintech ecosystem in Latin America through the lens of Rapyd, one of the companies that has been especially active in helping bring innovative financial services to the consumers of the region. We caught up with Eric Rosenthal, Vice President and Managing Director for the Americas with Rapyd for an extended Q&A via email.

Finovate: Rapyd just launched a new integrated payments solution in Mexico. How big of a deal is this for the company and its ability to serve the Mexican and Latin American markets? 

Eric Rosenthal: We have made significant investments in product sales and marketing strategy in Mexico and Latin America as these are critical markets to Rapyd’s growth. 

Rapyd has been quietly operating in Mexico since early 2018, building partnerships with local solution providers and developing relationships with businesses. With the launch of our integrated payments solution in Mexico, we formally announced our presence and the strong local partnerships we have developed which have enabled us to provide the full range of payment capabilities that merchants wish to offer to consumers based on how they want to pay. 

We intend to target local merchants that are looking into expanding their offerings in Mexico or that are looking into launching in other markets in Latin America or globally, as well as merchants outside of Mexico that have an interest in transacting with Mexico, either by disbursing or collecting funds. 

Mexico is a very strategic market for Rapyd. It is one of the five countries in the world where we have local entities and offer our full-stack capabilities – which means we offer all of our payment capabilities including collecting funds via bank transfers, cash and cards, disbursing funds across cash and bank transfers, and card issuing. It was one of the first countries we entered in 2018 – only two years since Rapyd’s founding – and the first country outside of the U.S. I personally opened as Managing Director for the Americas at Rapyd. 

Finovate: What can you tell us about this offering? What problem is it designed to solve and who is it designed to solve the problem for? 

Rosenthal: Whether we are talking about Mexico or any country in the world, the unfortunate reality of financial services has been and continues to be, that any merchant (marketplace, gig economy platforms, e-Commerce sites, etc.) trying to transact digitally will encounter payments infrastructure that is extremely fragmented. So if I am a Mexican merchant who is trying to solve the issue of collecting, disbursing, and issuing a card, I will need to integrate with three to five services providers – just in Mexico! 

Merchants that are expanding in Mexico or looking to enter new markets globally deal with this problem. It becomes exponentially harder to manage as they move into multiple markets. 

Rapyd is trying to eliminate the complexity that has come to characterize cross border finance. We look at how you simplify integration, and contracting processes and let companies dedicate their finite resources towards enhancing their core product instead of spending time and energy solving the challenges they face with payment and fintech integrations. 

Finovate: The company partnered with a number of major Mexican payment providers for this initiative. How important are these relationships for fintechs in the Mexican payments industry? 

Rosenthal: Our partners are what makes us unique – Rapyd is ultimately a network built on shared goals and collaboration. Through our partnerships we facilitate market entry that would otherwise be unattainable for many of these businesses to achieve on their own. Some of the areas we address include attending to merchants that are looking to scale their businesses as well as those looking to diversify their geographical coverage. In many cases, we have merchants that want to continue to work with their existing payment partners but in tandem begin to operate on the Rapyd platform as it offers a technology enhancement on top of what they are already doing, or simply because they are seeking a single point of reconciliation and settlement to minimize their operational overhead. 

So, for us, our partners are absolutely critical. What does it mean for the Mexican ecosystem? It ultimately means a better level of service for our end clients. We went out and found partners that are best in class, a handful of which we have announced publicly, and then others that we have not announced, but all of them are the best at what they do. So if you are a potential merchant looking for top of the line providers, you can trust that Rapyd has done the footwork, from the necessary technical integrations, ensured the network is compliant, performed the business due diligence, and also established attractive commercial terms with our partners. On behalf of the client, we minimize the effort and time of what would otherwise have been an enormous effort to set up what we set up on their behalf. Rapyd allows them to focus on their core business and not worry about the challenge of building and maintaining mission-critical payments infrastructure. 

Finovate: Many people in fintech here in the U.S. are aware of the fintech ecosystem in Europe and Asia, and even the Middle East, to a degree. We hear much less about fintech in Latin America. What are some important things for people to understand about that ecosystem?

Rosenthal: I personally have spent a lot of time living in Latin America. I lived in Peru for about 3 years and in Mexico for 3 years, so I have always felt a strong connection to the ecosystem. My perspective, shaped by having also lived in Southeast Asia, is that the Latin American ecosystem to a certain degree is a few years “behind” (in time, not in quality) and therefore the attention that has been given previously to APAC and Europe has to do with the fact that the ecosystem in Latin America is perceived to be a few years behind. 

The amount of time it takes for new initiatives to take hold or knowledge to transfer across the globe is significantly compressed. For example, most of what Rappi is doing is modeled after what Grab was doing in Southeast Asia three years prior. But yet you are now seeing that Rappi itself has significantly compressed its innovation cycle to launch new solutions and products. 

While the Latin American market may be less known for the time being globally, it is very well known by, and relevant to, those that have been operating in the region for some time. 

Finovate: What are some of the more unique aspects of fintech in Central and South America? 

Rosenthal: What is unique about Latin America is that it has a significant advantage over other markets, in my opinion when we talk about scalability and ease of adoption. While there are differences across cultures and of course dialect and language- don’t forget that Brazil has close to 250 million people speaking Portuguese, in the grand scheme of things Latin America is well suited for scale because of the commonality of language and ease of talent mobility- making the replicability of business models seamless. 

All that being said, we do continue to confront one challenge in Latin America, that is of course the sheer size of the market. Operating across 18 countries means 18 different regulatory regimes and few regional banking partners that are truly regional and that can offer the full set of capabilities.

But where there is fragmentation there is opportunity for Rapyd. Our ability to weave together multiple partners has positioned us as the single largest cash payment provider in the region. We have over 400,000 cash payment locations across Latin America, a large bank transfer network spanning each country we operate in, the ability to offer card acquiring in most of the countries we operate in, and the ability to hold the vast majority of Latin America currencies. That is something that even some of the world’s largest financial institutions are not able to provide. All of this together puts us in a prime position to serve clients that are looking for multi-country regional solutions. We believe that other companies such as Rapyd are playing a major role in removing these artificial technology barriers and borders between countries and are laying the foundation for more and more companies to scale with ease across the region and ultimately build more globally recognized fintechs. 

Photo by Gonzalo Facello from Pexels

Italy’s Nexi to Acquire Rival SIA in $5.4 Billion Deal

Italy has a new payments behemoth on the block courtesy of a big acquisition in its financial services industry. Nexi, the country’s biggest payments processor with more than $1.16 billion (€984 million) in revenue in 2019, has agreed to acquire banking and fintech solution provider SIA. The purchase price on the all-stock deal comes in at nearly $5.4 billion (€4.6 billion), and will create a new payments contender in the European market with a market capitalization estimated at $17.7 billion (€15 billion).

The acquisition will mark the second big deal in Europe’s payments space this year; Worldline agreed to acquire Ingenico Group earlier this year for $8.6 billion (€7.8 billion).

The combined company will be led by Nexi CEO Paulo Bertoluzzo, and will have two million merchants and 120 million cards. Analysts have suggested Nexi will be able to double its 2019 annual revenue to $2.13 billion (€1.8 billion) post acquisition, and enhance its business in Central and Eastern European markets in particular.

Curious about fintech in the EU’s third most populous member state? EY’s 2020 FinTech Waves report provides an in-depth overview of Italy’s fintech market, which grew from 16 fintech startups in 2011 to 345 fintech startups in 2019. The report notes that the country’s banking sector, though challenged by legacy systems in many instances, is focused on leveraging technology to improve efficiency and boost revenues. Five areas where Italian fintech startups have been especially active, based on EY’s research, are crowdfunding, machine learning/AI, smart payments and money transfers, lending, and insurtech.

“According to our analysis, the Italian FinTech ecosystem is heterogenous, small in size, but with high potential,” the report authors write. Read the full 100+ page report.

Nigerian Fintech Sees Opportunity in CEE SMEs

Lidya, which helps finance small businesses in its home country of Nigeria, has tuned its radar to opportunities far away: in Eastern Europe, to be specific. Earlier this week, the company announced that it had lent three million to small businesses based in the Czech Republic and Poland. Lidya went live in the Czech Republic in March and began offering its services in Poland one month later.

Lidya currently operates in 14 countries in Africa. The company’s expansion gives it the opportunity to lend not only to more small businesses, but to make larger loans, as well. Loans in Lidya’s native Nigeria average $1,500, and are available for as low as $150; Lidya co-founder Ercin Eksin said he anticipates that its operations in Europe could yield loan sizes 4x as big, given the GDP per capita difference between African markets and those in the CEE.

For more on Lidya and the technology scene in sub-Saharan Africa, check out this TechCrunch interview with Lidya CEO and co-founder Tunde Kehinde.

Here is our look at fintech around the world.

Sub-Saharan Africa

• South African challenger bank Bettr readies for 2021 launch.
• Ventureburn features PayCurve, an “ethical salary early access solution” provider based in South Africa.
• Nigeria’s ImaliPay introduces new tailored financial products for gig economy workers.

Central and Eastern Europe

• Four of Estonia’s biggest banks partner with AML startup Salv to launch pilot program AML Bridge.
• Vienna, Austria-based Trality, which is developing a trading bot for cryptocurrencies, raises $1.95 million (£1.5 million) in new funding.
• Estonia’s Sparq secures $517,800 (€440,000) in funding from Baltic International Bank.

Middle East and Northern Africa

• Fintech Magazine features Commercial Bank of Dubai COO Stefan Kimmel on digitization in banking.
• Dubai-based financial services platform Rise introduces its Xare app for expatriate workers to remit money back home.
• Albawaba profiles five of the “biggest fintech startups” in the Middle East: PayTabs, Bayzat, Liwwa, Tribal Credit, Aqeed.

Central and Southern Asia

• State Bank of India (SBI) launches the country’s first contactless payments wristwatch.
• Uni, an Indian fintech startup that seeks to bring affordable financing options to the underserved, raises $18.5 million in seed funding.
• A collaboration between Pakistan’s National Center for Cybersecurity and the National Clearing Company of Pakistan Limited has led to the creation of an AI-based cybersecurity system to help spot suspicious activity in financial transactions.

Latin America and the Caribbean

• Financial Times looks at the role of Colombian fintechs in the overall landscape of banking in Latin America.
• IBS Intelligence reviews the top five fintech funding rounds from September, highlighting Neon, dLocal, Marco Financial, Ideal, and Zoop.
• In a world in which ride-sharing apps are getting into fintech, Costa Rican fintech Omni announced this week that it was launching a ride-sharing service.

Asia-Pacific

• Bank of Thailand introduces the world’s first blockchain-based platform for government savings bonds.
• Indonesian fintech BukuWarung, which provides financial services to small businesses, raises as much as $15 million in new funding.
• MyMy, a digital payments startup based in Kuala Lumpur, Malaysia, raises $2.8 million (RM 12 million) in the country’s largest fintech seed round to date.