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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
We talked so much about the Buy Now Pay Later (BNPL) revolution in ecommerce that we are starting to sound like a broken record (someone please explain that reference to the younger millennials in the room). But the no-interest financing strategy is quickly becoming a must-offer feature for merchants, card issuers, and other players in the ecommerce ecosystem.
This week brings news that Zip Co, a digital retail financing and payments services company based in Australia, has agreed to acquire New York based Buy Now Pay Later company QuadPay in a deal valued at $269 million. One of the biggest BNPL companies in the U.S, QuadPay will enable Zip to expand its reach to five countries (Australia, New Zealand, South Africa, the U.S., and the U.K.), a combined annualized revenue of $182 million (AU$250 million) and 3.5 million customers.
Aside from the company’s co-founders, Adam Ezra and Brad Lindenberg, Zip was the largest shareholder in QuadPay. Ezra and Lindenberg will join Zip’s global leadership team post-acquistion with the responsibility of scaling business in the U.S.
Hungry for good news on the fintech funding front? Gaze no further than Latin America where a new report from KoreFusion highlights growth in smartphone ownership, ecommerce adoption, and dissatisfactioin with banks as just a few of the reasons why Latin America’s fintech boom is ust beginning.
The study, available for free from the San Francisco, California-based consultancy, is based on a study of more than 1,000 fintechs in Argentina, Brazil, Chile, Colombia, and Mexico. In addition to a survey of the fintech landscape – finding a concentration in the payments category with lending and B2B-based fintechs coming in second and third, respectively – the report underscores other areas – such as remittances and foreign exchange – where it believe major opportunities remain.
Read more in KoreFusion’s 2020 Latam Fintech Report.
Here is our look at fintech around the world.
Central and Eastern Europe
German regtech 4Stop partners with payment service provider emerchantpay.
ACI Worldwide announces that its technology helps power 75% of real-time payments in Hungary.
German P2P lender auxmoney raises $177 million (150 million euros) in growth capital.
The decision by Canada’s Constellation Software to acquire Uruguayan technology firm – and Finovate alum – Infocorp earlier this year is a reminder of the vibrancy of the fintech ecosystems thriving in the countries to the north and south of the U.S. The acquisition was completed in June via Constellation Software’s U.S.-based subsidiary Aquila.
“We have been looking for a partner to support us as we move to our next level of experience for our clients,” InfoCorp CEO Ana Inex Echavarren said. “We are excited to join Aquila and the Constellation family as they believe in long-term relationships, and the ‘buy and hold forever’ approach supports us in our focus on long term growth with our clients.”
Montevideo-based InfoCorp offers its customers an omnichannel banking platform that leverages the latest advanced technologies – conversational AI, machine learning, voice recognition, and chatbots – to build solutions to better engage and serve financial services customers. With clients such as Banco Santander, Banco de Bogota, Banco Internacional, and Towerbank, the 25+ year old company made its Finovate debut in 2017, demonstrating its marketing and commercial actions orchestrator platform that enables more agile, personalized, marketing campaigns that lead to higher conversion rates and ROI.
“InfoCorp has an inspiring focus on their clients,” Aquila CEO Mike Byrne said. “To produce solutions that connect the banks with their clients is such a deep passion for the team at InfoCorp. We are really looking forward to working with the group.” Operations at InfoCorp will remain the same, post-acquisition, with Echavarren continuing as CEO and the company keeping its client portfolio and offices. InfoCorp has 250+ workers in its development and innovation centers in Santiago de Chile, Montevideo, and Colonia.
In fact, the company announced last month that it is looking to expand into both Mexico and Argentina in the wake of the acquisition, with potential expansion to Europe, Canada, and the U.S., as well. Echavarren told BNamericas that the company is currently growing at a rate of 40% to 50% a year over the past five years and is looking at investments to power Infocorp’s ability to enter bigger markets.
The fintech ecosystem in Uruguay is often overlooked compared to the fintech industries in other Latin American nations such as Mexico and Brazil – both of which Uruguay borders. With a population of approximately three and a half million, the country is the second smallest in South America and gets high marks on a number of metrics including democracy, low perception of corruption, and e-government. Uruguay is regarded as a “high-income country” by the United Nations.
In its look at fintech in Uruguay, Contxto highlighted a baker’s dozen of companies that are not only growing regionally, but moving closer to expansion worldwide. The feature divides the country’s fintech industry into five components: payments, exchange, open banking, investments, and what it calls “fintech enterprise services (FES).” This primarily involves providing fintech solutions to online financial services companies.
Here is our look at fintech around the world.
Sub-Saharan Africa
A partnership with Standard Chartered Bank will enable Airtel Africa to build its fintech business and help support financial inclusion.
South African digital banking platform provider Ukheshe earns finalist spot in the 2020 Ecobank Fintech Challenge.
ThisDayLive features VC investor Ameya Upadhyay on the challenge of startup development in Africa.
Central and Eastern Europe
Fintech Futures takes a look at financial inclusion in Russia.
Poland’s mPay teams up with iDenfy to bring biometric facial recognition and other identity verification technologies to its mobile payments platform.
Romania’s PayByFace brings its biometric facial recognition technology to Up Romania cardholders, enabling biometric purchases as participating stores and restaurants.
Middle East and Northern Africa
CIH Bank of Morocco partners with Finastra for a remote implementation of the company’s Fusion Corporate Channels and Fusion Trade Innovation systems.
Cairo, Egypt-based payments-as-a-service fintech Paymob raises $3.5 million in funding.
National Bank of Oman enables cardless ATM transactions.
Central and Southern Asia
MEDICI featured Indian regtech startup Signzy in its RegTech Top 21 Startups for 2020 roster. Signzy is the only Indian regtech to make the list.
Reserve Bank of India announces offline digital payments pilot project.
JCB International and PJSCB Orient Finans initiate merchant acquiring operations in Uzbekistan.
Rapyd partners with PayMyTuition to boost the company’s ability to accept bank transfer-based payments from countries in Latin America and the Asia Pacific region.
WorldRemit teams up with a pair of Mexican neobanks, albo and Klar.
Asia-Pacific
Ayoconnect, a billpay network based in Indonesia, raises $5 million in pre-Series B funding.
Southeast Asian fintech TrueMoney teams up with cross-border payments firm Thunes to expand its remittance business.
Vietnamese digital banking platform Timo announces new partnership with Viet Capital Bank.
This week for Finovate Global, we caught up with Mohammed Aziz, co-founder and CEO of Dapi, a fintech startup that offers a suite of open banking APIs to help connect customer bank accounts, initiate payments, and access data in real-time. Founded in 2019, the company currently operate in six countries in the Middle East and Africa, and is headquartered in both San Francisco, California, and the UAE.
We talked about the opportunity for open banking to fuel innovation in financial services in emerging economies, as well as the overall environment for fintech innovation in the MENA region. We also discussed the impact of the COVID-19 crisis on pre-existing trends such as digitization.
Finovate: Dapi is the third company you’ve founded, but your first fintech. What made you want to focus on the opportunities in this industry? What do you bring to fintech from your experience in other areas?
Mohammed Aziz: Dapi was the result of a problem that I personally faced when trying to build “Spendy” a hybrid between a peer to peer payment application and a personal financial management app. We were unable to build out Spendy for most emerging markets due to the lack of bank connectivity which got us super keen to build out the underlying infrastructure that would power the future of fintech in these markets.
Finovate: Tell us about Dapi. What problem does your company solve and who are your primary customers?
Aziz: Dapi’s mission is to provide the building blocks for a thriving fintech ecosystem in emerging markets around the world. Our API serves as the bridge between financial applications and banks, empowering developers to create digital wallets, budget trackers, investment applications and more. Our clients are developers working on fintech applications, businesses hoping to include financial services in their mobile and web offerings, and anyone that wants to include bank functionality within their digital offerings.
Finovate: Your business strategy relies on an embrace of open banking in the MENA region. How strong is the movement toward open banking there?
Aziz: The MENA region is a very exciting space to be operating in right now. Fintech is only beginning to develop here and the market is pretty much untapped, so we are hoping to serve as an influence towards the region embracing open banking and all the opportunities that come with that. I would also like to point out that we are able to activate and build connectivity regardless of open banking being present or not. We like to take the approach that companies like Plaid in the US or Truelayer in the UK did, whereby they were connected to banks despite frameworks and regulation being in place.
Finovate: Aside from open banking, what are some of the other exciting trends in the fintech industry in the Middle East/Abu Dhabi right now?
Aziz: There’s a general trend of growing interest for the kinds of applications that financial technology empowers, from digital wallets and peer to peer applications to investment platforms and digital banks. The market is new and rapidly evolving.
Finovate: We talk about the Middle East and North Africa as a region. But there is a great deal of variation among countries in MENA. How does this impact your ability to market your technology in the area?
Aziz: Beyond market considerations, the regulation surrounding the use of APIs in financial applications varies greatly from country to country. This is a new and mostly unregulated space, but we have had to consider completely separate approaches to integrating our services in the UAE as opposed to KSA, for example. Culture is also another important factor, as it varies between countries and impacts the products that you would want to launch along with the go-to-market approach.
Finovate: How has COVID-19 impacted the fintech industry in the region? Early in the crisis, we heard news from countries like Iran, but not as much since. How are businesses, especially fintech businesses, faring?
Aziz: The COVID-19 pandemic and its push towards social distancing and remote work has actually increased interest in digitization of financial services. For example, there have been a number of announcements within the UAE that the country will be moving towards enabling more online payments and other financial services without the need to physically go to a bank.
Finovate: You participated in the Y Combinator program. What was that experience like? What advice do you have for startups with the opportunity to pursue a similar path with a top-notch accelerator?
Aziz: Y Combinator has been a phenomenal experience for us. It really put us out there on the map and helped expand our network in silicon valley. From our experience, investors and VCs in the US are not usually convinced about investing in early stage MENA startups, but YC really helps establish that credibility.
Finovate: Tell us about your experience of setting up your business in Abu Dhabi.
Aziz: Abu Dhabi is an exciting place to work, since it is a rapidly growing and developing market, as mentioned above. Furthermore, we have received a lot of support from our involvement in ADGM and Hub71, which provided resources for us to establish and grow our operations in these beginning stages.
Finovate: What can we expect from Dapi over the balance of 2020 and beyond?
Aziz: We are very excited to continue growing and expanding into a variety of developing markets, beyond the UAE. At the same time, we have a number of exciting partnerships in our sights for the UAE, which we hope will bring our vision of a strong fintech ecosystem in the MENA region closer to reality.
Here is our look at fintech around the world.
Asia-Pacific
Singapore-based MatchMove launches cross-border remittance platform for businesses.
Clik, a payment aggregator and merchant acquirer based in Cambodia, raises $3.7 million in seed funding.
Leading Asian financial services platform GoBear teams up with UnionBank to launch lending-as-a-service solution in the Philippines; announces new Chief Financial Officer.
Sub-Saharan Africa
Fiservinks partnership with Absa Regional Operations (ARO) to enhance credit card management and processing in nine African countries.
Ecobank Group unveils the finalists for its fintech challenge, now in its third year. Ten African startups from seven different countries made the cut out of an applicant pool of more than 600.
Salaam Gateway looks at the development of Islamic fintech in Kenya.
Central and Eastern Europe
Onfido to streamline digital identity verification for Poland’s Alior Bank.
Russia’s Tinkoff Banklaunches new charitable program, Cashback to Give Back.
Austrian regtech kompany lands $7.14 million in funding.
Middle East and Northern Africa
Salt Edgepartners with Jordan Ahli Bank Cyprus, making it one of the first banking groups in Cyprus to achieve PSD2 compliance.
Israeli fintech Approve.com raises $5 million in seed funding for its technology that automates the procurement process.
Infosys Finacle to deploy its Liquidity Management platform with National Bank of Bahrain.
Central and Southern Asia
Uzbekistan’s People’s Bank partners with Finastra to automate its risk management business.
TerraPay collaborates with Bank Alfalah to enable instant money transfers to Pakistan.
Indian B2B fintech Signzy announces plans to hire “close to 70” employees over the next six moths in response to increased demand.
Latin America and the Caribbean
Feedzaiexpands partnership with PayU, enabling the company to enhance its fraud prevention capabilities in Latin America and the EMEA region.
TechCrunch profiles Mozper, a digital banking service based in Latin America that caters to parents and Gen Z kids.
MercadoLibre announces plans to launch branded credit cards in Brazil and Chile “in the near future.”
Village Capital has unveiled the names of the 12 companies that will participate in its Finance Forward Latin America 2020 accelerator program. The incoming cohort will get five weeks of training to help them improve their business models and tailor their solutions for the current demands of the marketplace. The top two peer-selected startups will be eligible to receive $50,000 each in grant funding from program partner MetLife Foundation. Startups ranked third to fifth each will receive $16,000 in grant funding.
What do the 12 startups chosen – from an applicant pool of more than 140 – suggest about the state of fintech innovation in Latin America?
First of all, in some ways, the geographic distribution of companies is representative of what we see in terms of fintech’s strength in the region. Mexico has three representatives, Argentina has two, and Brazil and Chile both have one. Perhaps more surprising is the representation from Colombian fintech, with the country bringing five startups to the program.
Village Capital notes that the selected startups also reflect impressive gender diversity, with more than 80% of the participating companies having one or more female founders. The accelerator also credited the more than 40% of these companies that are innovating “outside major fintech hubs.”
The startups are involved in a wide range of fintech focus areas – from debt management and credit services to e-commerce, “buy now pay later” solutions. Many of these firms offer innovations that are particularly geared toward un- and under-banked populations. Among the more interesting startups in this category are Fundefir, a Colombia startup that specializes in bringing credit and insurance to the underbanked, and Quipu Market, also based in Colombia, which offers an e-commerce marketplace that enables informal microbusinesses to buy and sell locally using community tokens rather than cash.
Village Capital’s accelerator program features the support of PayPal and Moody’s, as well as MetLife Foundation. Since its launch in 2009, Village Capital has worked with more than 1,000 early stage entrepreneurs via its accelerator programs.
“The coronavirus pandemic has had devastating financial effects on low-income populations in Latin America,” Regional Manager for Village Capital Daniel Cossio said. “Now more than ever, tech-driven innovation can be at the forefront of helping small businesses stay afloat, families manage their income, and the region embark on what is bound to be a challenging recovery.”
Some of the more recent research on fintech in Latin America includes this February report from CB Insights, which helps provide context for the expectations many analysts had for the region at the end of 2019. For insights since the COVID-19 crisis, the May discussion published by Latin America Reports shows how fintech has played a “stabilizing” role in helping businesses and individuals cope with the economic and social impact of the pandemic.
Here is our weekly look at fintech around the world.
Payment solutions provider Cohort Go teams up with Brazilian bank Itau as it expands into the country.
Konsentus and Open Vector collaborate to bring open banking to financial institutions in Latin America and Canada.
Asia-Pacific
Hong Kong payments network infrastructure startup EMQ raises $20 million in funding to accelerate cross-border payments.
Venio, a mobile app that specializes in providing financing in emerging markets, goes live in the Philippines.
AEE News Today profiles Malaysian fintech Instapay Technologies which recently partnered with Mastercard to launch an e-wallet service for migrant workers.
Sub-Saharan Africa
Alegra, a cloud-based accounting software provider based in Colombia, announces expansion to Kenya, Nigeria, and South Africa.
Airtel Africa teams up with Mukuru to enable cross-border payments.
Mobile money operators are among the biggest players in fintech in sub-Saharan Africa. TechZim reviews the state of mobile money in the southern part of the continent.
Central and Eastern Europe
A biometric facial recognition-based payments system developed by Romanian fintech PayByFace goes live in Bucharest’s Tucano Coffee shops.
Nordigenscores payments license from Latvia’s Financial and Capital Markets Commission (FKTK), enabling it to provide account information services.
Lithuania’s Bankera introduces business loans for SMEs.
Middle East and Northern Africa
Arabian Business takes a look at the rise in popularity of buy now pay later platforms in the UAE.
Dubai International Financial Centre inks Memorandum of Understanding (MoU) with China’s Jiaozi Fintech Dreamworks.
Al Khaleej Today profiles Saudi Arabia-based payments company Tap Payments and its initiatives to help small businesses during the COVID-19 crisis.
Central and Southern Asia
Indian online investment and wealth management platform, Paytm Money, introduces new Chief Executive Officer Varun Sridhar.
Uzbekistan’s first digital bank, TBC Bank, goes live with technology from Capital Banking Solutions.
Niyo, an India-based neobank, acquires mutual fund investment platform Goalwise.
A report earlier this year from PwC highlighted the “changing competitive landscape” for fintech and banking in Nigeria. For those looking to learn more about both the growing impact of technology in financial services in one of the major countries in Africa, as well as the challenge created by COVID-19, PwC’s review provides an comprehensive overview.
The report also concludes with nine recommendations the analysts believe would encourage continued growth in Nigeria’s fintech ecosystem. These recommendations range from making it easier to invest in fintech companies to encouraging partnerships and “strengthen(ing) the synergy between banks and FinTech players” in a mutually beneficial way.
Financial inclusion is a huge part of both the challenge of – and the opportunity for – fintech in Nigeria. The report notes that more than 30 million adult Nigerians do not have or use either formal or informal financial services products or solutions. This represents more than a third of the country’s adult population. And while the report points out that mobile money operators have been among the businesses to help bring more financial services to the underbanked, there are some fintechs that have taken up the cause of financial inclusion, as well. A trio of these companies are highlighted below:
Bankly is a cash digitization and savings platform that caters to Nigeria’s unbanked. The company provides a digital wallet that is secure, convenient, and accessible, and all users require in order to open an account is a phone number. Bankly leverages more than 2,000 agents across 29 of the country’s 36 states to scale the company’s offering.
In operation for just over a year, Bankly has already picked up recognition from the 2019 Innovating Justice Awards sponsored by the Hague Institute for the Innovation of Law. The company has also participated in the GreenHouse Capital accelerator program. Tomilola Adejana (CEO) and Fredrick Adams are co-founders.
Covr Branchless offers banks, insurance companies, and government agencies a suite of applications that enable them to leverage cloud, GPS, and mobile channels to conduct a wide variety of financial processes. Account opening, instant debit card linking, cash withdrawals, fund transfer, billpay, KYC validation and loan origination are among the operations enabled by Covr’s technology.
Covr is owned by Advancio Interactive, a Nigerian technology company focused on sustainable financial access that was founded by Olufisayo Oludare (Managing Director). Covr won Advancio first place at the Startup Istanbul Challenge in the fall of 2017, only the second Africa-based startup to do so.
FairMoney is a online micro lender that provides instant loans from N1,500 to N500,000 (approximately $4 to $1,300), with average loans of about N12,000 ($33-$35). Using the company’s Android mobile app, prospective borrowers apply for financing by answering a few questions and providing some basic financial information. The app analyzes this information – as well as the borrowers geolocation and other factors – to make a loan offer in a matter of minutes.
But what makes the company especially interesting is the fact that it is working to launch a challenger bank. FairMoney raised $11 million in Series A funding last fall for this purpose and plans to expand its offerings to include current and savings accounts.
Here is our weekly look at fintech around the world.
Central and Southern Asia
Reserve Bank of India (RBI) encourages government to incentivize the use of QR code transactions and promotes the adoption of open, interoperable standards.
Amazon to offer car and motorcycle insurance in India courtesy of partnership with Acko General Insurance.
National Payments Corporation of India (NPCI) facilitates recurring payments with its new UPI AutoPay feature.
Latin America and the Caribbean
Brazil’s Central Bank reverses course to authorize payments system involving WhatsApp.
Payscout teams up with Brazilian fintech Rede Celer to grow its payments business in the country.
Partnership between FacePhi and Naranja X will help bring biometric recognition technology to digital onboarding processes for firms in Argentina.
Asia-Pacific
Finovate: Ant Group’s Double IPO Listing Shuns U.S. Exchanges.
Trulioobrings its GlobalGateway identity verification technology to customers in Vietnam.
Crowdfund Insider takes a look at the impact of COVID-19 on fintech lending platforms in Indonesia.
Sub-Saharan Africa
Telco Orange and bancassurance company NSIA team up to launch Orange Bank Africa to serve underbanked communities in Abidjan and Cote d’Ivoire.
Vodacom partners with Ant Financial Services Group to bring Alipay services to South Africa.
Uganda-based digital cross-border money transfer startup Eversend raises $1 million via an oversubscribed Seeders crowdfunding campaign.
Central and Eastern Europe
Germany’s Scalable Capitallands $460 million valuation with new $58 million funding round.
Russian bank Tinkoffunveils new functionalities for its financial and lifestyle services voice assistant Oleg.
EstateGuru, a P2P lending platform based in Estonia, launches a new payment service in partnership with Lemonway.
Middle East and Northern Africa
Oman’s BankDhofar extends partnership with Diebold Nixdorf to improve the customer experience of its ATM network. Bank Nizwa, also based in Oman, announced an extension of its digital payments partnership with Mastercard.
Turkey-based online payments platform Mobilexpress secures $2 million in Series A funding.
Spotii, an e-commerce technology provider based in the UAE, unveils new deferred payment option.
A number of Finovate alums made international fintech headlines this week. Open banking specialists were particularly active, with Canada’s Salt Edge inking partnerships with fintechs in Ireland, and Sweden’s Tink announcing an acquisition of credit decision solution provider, Instantor.
“We will be able to get a full suite of bank data for any regulated lender in this country within seconds, meaning loan applications can be assessed quicker,” Karl Deeter, founder of OnlineApplication said of the partnership with Salt Edge. “In the Irish market that’s a new proposition.”
Tink’s acquisition of Instantor is only the latest news from a company that has spent much of the year forging strategic partnerships, securing multi-million euro investments, and … acquiring companies. Before Tink’s announced purchase of the Stockholm, Sweden-based credit decisions solution provider this week, the company had pulled out the checkbook to buy fellow Finovate alum Eurobits Technologies.
With regards to its Instantor purchase, Tink sees the company helping it to offer intelligent data-services based on open banking. Instantor supports five million credit decisions a year and reported annual revenues of $4.5 million (€4 million) in 2019.
“This move will help Tink expand their product offering and is unique opportunity to continue to make significant investments in our portfolio of credit decision solutions,” Instantor CEO Simon Edström said. “Together with Tink we will create an even stronger European market leader in open banking.”
Here is our weekly look at fintech around the world.
Middle East and Northern Africa
Is Qatar the next big fintech hub for companies looking to expand to India, Pakistan, and Bangladesh? MENA FN investigates.
Lean, a financial API platform based in Riyadh, Saudi Arabia, raises $3.5 million in seed funding.
UAE-based cross-border fintech marketplace Fintech Galaxy unveils its open innovation platform.
Central and Southern Asia
Payment solutions company PayU announces partnerships with a pair of e-commerce platforms: Shiprocket Social and Quick eSelling.
Is Qatar the next big fintech hub for companies looking to expand to India, Pakistan, and Bangladesh? MENA FN investigates.
Pakistan Observer looks at how fintech help support innovation in the Islamic finance sector.
Latin America and the Caribbean
JP Morgan buys stake in Brazilian digital banking fintech FitBank.
“Loans for phones” consumer financing company Finnu raises $800,000 in pre-seed funding to help bring credit options to the underbanked of Mexico and Latin America.
Contexto looks at the state of the challenger bank movement in Brazil.
Asia-Pacific
PayMaya and Bonds.Ph are working together to drive financial inclusion in the retail investment market in the Philippines.
A feature at the World Economic Forum website discusses the role of fintech in helping small businesses in Southeast Asia recover from the global pandemic.
Vietnamese digital real estate investment platform RealStake secures seed funding from 500 Startups, as well as angel investors.
Sub-Saharan Africa
A partnership between Crown Agents Bank and Paycode of South Africa will help promote financial inclusion in sub-Saharan Africa.
Zazu, a fintech based in Zambia, teams up with global payments company Tutuka to launch its Mastercard-issued virtual card.
Techpoint Africa profiles Capetown, South Africa-based remittance specialist, Mukuru.
Central and Eastern Europe
German digital banking solution provider CoCoNet launches new business unit.
Mastercard takes its partnership with Verestro to the next level with an announcement that the card company has become an investor in the Polish payment solutions provider.
Wall Street Journal looks at the Wirecard warning signals missed by German regulators.
The ways that ride-sharing companies in Asia have leveraged their platforms to bring a variety of financial services to underserved communities is one of the more noteworthy – and unexpected – developments in the evolution of fintech in the region.
Many people are familiar with Grab, the car-sharing and food delivery company founded in 2012 and based in Singapore. The firm picked up more than $850 million in funding in February to help fuel both its payments and financial services operations. Grab competes with other similar companies in the region such as Indonesia’s Gojek that have also taken the so-called “Super App” route to diversifying their offerings into e-commerce and financial services.
This week we learn that Asia’s ride sharing industry is helping financial services innovate in another way: China’s Didi has inked a deal with the country’s central bank to test its digital national currency. The strategic partnership, announced earlier this week, is designed to “jointly study and explore the innovation and application of digital RMB in the field of smart mobility.”
Digital RMB trials began earlier this year in April, and involved four Chinese cities – as well as host of major U.S. brands like Starbucks and McDonald’s. China’s top four, state-owned banks have been included in the trials, and are reportedly testing a wallet to enable users to store and send the digital currency. The People’s Bank of China hopes to launch its digital RMB around the time of the 2022 Winter Olympics, to be held in Beijing. The central bank has been working on its digital currency project – known as Digital Currency Electronic Payment (DCEP) since 2014.
We took a look at how different countries around the world have begun to examine the role digital currencies could play in their economies earlier this year in Finovate Global. Here is our reporting on digital currencies and central banks in Europe and the Americas. For more on the pros and cons of digitizing national currencies, check out our coverage from the beginning of the year, as well.
Founded in 2012, Didi has more than 550 million users in China, Asia, Latin America, and Australia who use its on-demand transportation service.
Here is our weekly look at fintech around the world.
Central and Eastern Europe
Pair Finance, a digital debt collection company based in Berlin, Germany, secures $2.2 million (€2 million) in new funding from existing investors.
U.K.-based banking services provider ELPASO goes live for Ukrainian SMEs and merchants.
Paysafe, a payment service provider headquartered in the U.K., launches its Paysafecash solution in Bulgaria.
Middle East and Northern Africa
Paymentology, a cloud-based payment processor based in the U.K., to expand its operations in the Middle East.
Discover and Saudi Payments ink strategic agreement that will enable cardholders to use the cars on the country’s mada network.
Libyan fintech Tadawul Tech launches its new Electronic Payment Platform.
Central and Southern Asia
India’s Paytm to acquire insurance company Raheja QBE in deal valued at $76 million.
Central Bank of Sri Lanka to develop blockchain-based KYC platform.
Pakistan-based digital wallet SadaPay hires former Gojek executive Jon Sheppard as its new Chief Technology Officer
India-based insurtech marketplace PolicyBazaar scores $130 million in new investment from SoftBank’s Vision Fund.
Latin America and the Caribbean
Fintech-as-a-service company Rapyd goes live in Mexico with its integrated payment solution.
Brazilian fintech Swap, which helps FIs build their own fintech businesses, raises $3.3 million in seed funding.
Brazilian SME financial solution provider One7 acquires small business invoice financing firm Rapidoo.
Asia-Pacific
Payfazz, an Indonesian company that provides financial services to the underserved communities, raises $53 million in Series B funding.
A partnership between Viet Capital Bank, 7-Eleven Vietnam, and JCB International (JCBI) powers the launch of the Viet Capital Bank JCB 7-Eleven credit card.
Fintech Futures looks at open banking adoption rates in South Korea.
Sub-Saharan Africa
Global online money transfer services company WorldRemit goes live in Somalia.
Nigeria’s Inter-Bank Settlement Scheme (NIBSS) reports an increase in mobile payments of more than 390% since May 2019.
Visalaunches its online payment solution, Click to Pay, in South Africa.
Berlin, Germany-based “tech company with a banking license” solarisBank has secured $67 million in funding (€60 million). The Series C round was led by HV Holtzbrinck Ventures and Storm Ventures, and featured participation from a wide number of investors including BBVA, ABN Amro, SBI Group, Global Brain, Hegus, and Lakestar. Also participating in the oversubscribed round were Vulcan Capital and Samsung Catalyst Fund.
The investment takes the company’s total funding to more than $180 million (€160 million), and will be used to help fuel Solarisbank’s continued expansion throughout Europe. Since 2017, the company has doubled its revenues every year, and grown its product portfolio to include solutions like decoupled debit cards and post-purchase installment products. With more than 400,000 end-customer accounts as of the end of the first half of 2020, the company also announced that it will expand its operations in the cryptocurrency space via its subsidiary solaris Digital Assets.
“solarisBank is continuing its impressive growth and the current financing round will help us to expedite building a pan-European platform,” solarisBank CEO Dr. Roland Folz said in a statement. He added, “We are the leading platform for Banking-as-a-Service in Europe and are excited that this exceptional group of new investors will now be a part of our journey.”
At the same time, Deloitte Digital’s Middle East FinTech Study, released in June, cautioned that further fintech development in the region faces challenges with regard to financing, and a wariness from traditional banks toward engaging fintechs. The latter issue in particular reflects what the report authors – Rushdi Duqah and Anthony Yazitzis – call “a certain degree of contradiction and dichotomy.”
“Customer behavior across the Middle East, especially in KSA, is characterized by a willingness to adopt innovative solutions offered by banks,” Duqah and Yazitzis observed. The two highlighted P2P money transfers, account aggregation, and roboadvisory as three such areas. “However, banks are not leveraging the full suite of FinTech solutions/features to address customer’s needs and requirements to enhance the daily banking journey and experience,” they wrote.
Read the full report to see how “harmonization and trust” are the path forward for financial services companies, fintechs, and banks in the Middle East and Northern Africa.
What’s Next for Wirecard?
We reported on the crisis facing Germany’s Wirecard two weeks ago in Finovate Global. Company CEO Markus Braun stepped down amid reports that Wirecard could not account for $2.1 billion in cash, and concerns that the company was “the victim of fraud of considerable proportions.”
This week we learned that Braun has been arrested – though since released on bail – and that Deutsche Bank has engaged with the now-bankrupt company and is considering providing financial support. A report in Bloomberg noted that Deutsche Bank had conducted talks with Wirecard last spring (referred to as “preliminary discussions” that were quickly concluded) and that, despite its woes, Wirecard could be a potentially attractive acquisition target thanks to its partnerships with Visa, Mastercard, and JCB International.
Here is our weekly look at fintech around the world.
Sub-Saharan Africa
Billed as “the grand fintech consolidation,” TechCabal takes a look at MFS Africa’s purchase of SME digital payments provider Beyonic.
Nigerian fintech Wallets Africa locks in new funding from investors including Y Combinator CEO Michael Seibel.
The East African makes the case for Kenya as a top destination for venture capital in Africa.
Central and Eastern Europe
Top banking-as-a-service platform solarisBank raises $67 million (€ 60 million) in Series C funding.
Electronic payment network Paysera expands to Kosovo.
Azerbaijan’s Xalq Bank launchesCompass Plus’ open development platform, TranzAxis.
Middle East and Northern Africa
Digital property management and rent collection platform Ajar earnsUAE’s Most Trusted Fintech in 2020 honors from APAC Business Headlines.
UAE’s central bank and the Abu Dhabi Global Market (ADGM) announce the start of their annual Fintech Abu Dhabi Innovation Challenge for fintechs developing solutions for local small businesses.
Dubai’s Mamo Pay earns spot in Visa’s Finech Fast Track Program.
Central and Southern Asia
Transfast, a U.S.-based cross-border payments company, partners with Pakistan’s Habib Bank to enable money transfers to Pakistan.
Bangalore, India-based fintech Zeta announces expansion into Vietnam and the Philippines.
Indian gold lending startup, Rupeek, unveils zero contact gold loan kiosks to support touchless financing amid the coronavirus pandemic.
Latin America and the Caribbean
Mexican fintech ePesos announces $21 million debt financing round with Accial Capital.
BizCapital, a lending startup based in Brazil, raises $12 million in funding thanks to an investment from Germany development finance institution, DEG.
Credit Suisse buys 35% of Brazilian digital bank modalmais.
Asia-Pacific
Myanmar Citizens Bank (MCB Bank) issues MPU-JCB co-branded debit cards.
Razer’s fintech arm, Razer Fintech launches new initiative to support local businesses in Malaysia during the global health care crisis of COVID-19.
KrASIA profiles Indonesian fintech Akulaku, which offers online credit, wealth management, and digital banking services in the Philippines, Vietnam, and Malaysia.
Today is Canada Day, which commemorates the date in 1867 when three provinces – Nova Scotia, New Brunswick, and the Canada Province (now known as Ontario and Quebec) – united to form a single nation. And while the global public health crisis may limit the holiday’s typical parades, cook-outs, fireworks demonstrations, and concerts, rest assured that Canadians all over the world will find a way to celebrate what is colloquially – if a bit inaccurately – referred to as “Canada’s birthday.”
With this in mind, the Finovate blog sends a hearty “Happy Canada Day!” to the dozens of Canadian fintechs that have demonstrated their innovative solutions at our conferences over the past decade-plus.
A pair of Finovate alums have joined forces to help a leading financial platform in Asia launch a lending solution as part of its planned expansion in the region.
German cloud banking platform provider Mambu and alternative credit score provider CredoLab have announced a partnership with GoBear, a financial services platform based in Singapore. The company, founded in 2015 as a metasearch engine and now operating as a financial services platform that has served more than 55 million consumers, plans to expand into the Philippines later this year. Technology from Mambu will power the core system in GoBear’s lending architecture, with CredoLab’s credit scoring helping ensure the company is able to bring financing to those communities that need it most – and often struggle to secure it.
“Having access to responsible credit should be a financial right for all,” GoBear Chief Lending Officer Mike Singh said. “Tapping into fintech solutions like Mambu’s and CredoLab’s brings us one step closer to making this a reality for the region’s 296 million unbanked or underbanked.”
The tripartite partnership was the result of a pair of relationships; Mambu and CredoLab have been long-time partners, while CredoLab and GoBear collaborated as recently as November 2018, when the two companies worked together on a credit solution for the underbanked.
“In less than five years of operation, GoBear has built a stellar reputation as a leading financial services platform and we envisage great things for the company as it continues to build its lending business,” Mambu Managing Director for APAC Myles Bertrand said. He pointed out that the company’s technology would enable GoBear to readily add new products while maintaining a high level of customer service.
CredoLab CEO Peter Barcak pointed to his company’s SDK, API, and alternative credit score – which leverages metadata from smartphone usage – as powerful tools for companies like GoBear that are trying to serve a broader array of customers. “Our ability to generate a credit score for customers who cannot prove their creditworthiness in the conventional financial system makes us uniquely positioned to support GoBear as they diversify their business and move into lending in a controlled way.”
Finovate alums since 2013 and 2018 respectively, both Mambu and CredoLab made their Finovate debuts at FinovateAsia events. Mambu demonstrated its technology the year we held our Asian conference in Singapore. CredoLab unveiled its CredoScore the year we held FinovateAsia in Hong Kong.
Speaking of FinovateAsia, remember that our new, all-digital FinovateAsia conference begins next week. Check out our FinovateAsia hub for more details!
U.K.-based peer-to-peer lender Zopaannounced this week that it has been awarded a full U.K. banking license and will move forward with its plans to launch a digital bank.
The bank will offer the Zopa Fixed Term Savings Account, which features FSCS protection up to £85,000. Zopa plans to introduce a credit card later this year.
“Now more than ever the banking industry needs innovative, agile providers who work on behalf of customers,” Zopa CEO Jaidev Janardana said. “At a time when people want great value, fair financial services products, and simple, intuitive digital experience(s), Zopa offers consumers a compelling and credible alternative they can trust.”
Founded in 2005, and one of Finovate’s earliest alums, Zopa raised $182 million last December in preparation for bank launch announced this week. The company has secured a total of more than $464 million in funding since inception.
Village Capital is out with its State of Financial Health Startups report which looks at the areas of innovation with the “greatest potential to improve the wellbeing and inclusion of marginalized communities in MENA.”
The State of Financial Health Startups in MENA acknowledges the attention paid to areas of fintech such as digital payments and e-commerce. At the same time, the goal of the report is to focus on those ways that fintech can solve specific problems in the region, specifically the challenge of inequality.
The report highlighted six fields of fintech innovation that are mostly likely to meet this challenge, as well as 12 startups that are active in these areas. The fields were:
saving and wealth-building technology
employment tech
digital ID
financial literacy services
access to capital
alternative lending
The twelve featured startups were:
Rumman (Palestine)
SmartCrowd (UAE)
Kader (Jordan)
Khtwteen (Egypt)
Hawiyati (Jordan)
Valify Solutions (Egypt)
Finllect (UAE)
Merakido (Egypt)
Fawaterak (Egypt)
Fundbot (Lebanon)
Ciwa (Morocco)
Solfeh (Jordan)
The Catalyst Fund, supported by BFA Global, UK aid, JP Morgan Chase and Rockefeller Philanthropy Advisors, has announced its latest fintech cohort.
The Fund has accelerated 31 portfolio companies that have raised collectively more than $64 million in follow-on fundraising since inception. The Fund awards each of its portfolio companies $100,000 in grant capital, as well as venture-building support for six months, and one-on-one networking with investors and corporate leaders to help them scale their businesses. Of the companies making the cut were a number of fintechs including:
FlexFinance (Nigeria)
Paymenow (South Africa)
Mango Life (Mexico)
Graviti (Mexico)
KarmaLife (India)
“We believe we are facing a catalytic moment during which there is an opportunity to use technology to help low-income consumers and small businesses recover from the impact of COVID-19 and build greater financial resilience for the future,” Catalyst fund director Maelis Carraro said.
Here is our weekly look at fintech around the world.
Asia-Pacific
Malaysian recurring payments platform Curlec announces funding from 500 Startups.
Thai cashless solution provider for businesses SYNQA raises $80 million in Series C investment.
TechWireAsia looks at the impact of COVID-19 on Indonesia’s emerging fintech industry.
Sub-Saharan Africa
Nigerian fintech KiaKia goes live with its app that enables users to invest in the funding of secured personal and business loans.
Centbee, a fintech based in South Africa, adds the ability to purchase prepaid electricity, airtime, and data via a new feature on its BitcoinSF wallet.
GhanaWeb features Ghanaian cross-border, money transfer company FXKudi.
Central and Eastern Europe
Edenred, a French prepaid corporate services provider, launches Apple Pay mobile payments for digital meal vouchers in Romania.
Lithuania-based identity verification firm iDenfy partners with U.K. online banking platform Cashaa to help cryptocurrency investors in India avoid fraud.
Austria gains a new insurtech competitor as Hong Kong-based bolttech partners with local telcom Drei to bring the first non-insurance switch program to the country.
Middle East and Northern Africa
Egypt-based fintech MoneyFellows raises $4 million in Series A funding.
Global tech ecosystem, Hub71, teams up with Mashreq Bank and First Abu Dhabi Bank to help startups open bank accounts in the UAE.
Commercial Bank of Dubai and cross-border payment provider Thunes announce partnership, enhancing CBD’s ability to operate in countries such as India, the Philippines, Pakistan, and Bangladesh.
Central and Southern Asia
India-Based Slice raises $6 million for digital payments.
BharatPe, a QR code-based, merchant payments company based in India, enters the point of sale business with the launch of its Bharat Swipe PoS solution.
Alphabet’s growth equity arm, CapitalG, invests $28 million in India-based SME lender Aye Finance.
Latin America and the Caribbean
BBVA announces that its mobile banking platform GloMo will support Apple Watch users in Uruguay.
Mexican bank Banorte and on-demand delivery firm Rappi partner to launch a financial services company in Mexico.
Central Bank of Brazil suspends WhatsApp payments in the country, citing competitiveness concerns.
The international fintech community received an unexpected jolt on Friday on news that the CEO of Wirecard, Markus Braun, was stepping down. Braun’s resignation comes amid reports that the German digital financial platform he has led since 2002 cannot account for $2.1 billion in cash, and a delay in the release of its 2019 financial report. Reuters reported that the company admits it could be have been “the victim of fraud of considerable proportions.”
Up until recently Wirecard appeared poised for success as a leading European payment processor for both consumers and businesses. The company reported revenues of $2.2 billion in 2018 and, by the fall of that year, had reached a valuation of $26.9 billion.
But suspicious of the company deepened early last year. A Financial Times report in January alleging suspicious financial activity in Singapore, and the announcement of an official investigation by Singapore authorities a month later, tarnished Wirecard’s image despite the company’s denials. This was followed by claims of further questionable financial activity – this time in Ireland – in October.
In this week’s news, auditors at EY, formerly known as Ernst & Young, were not able to locate cash at two Asian banks – Bank of the Philippine Islands and BDO Unibank – where Wirecard said $2 billion had been deposited. Both banks have denied having a business relationship with Wirecard. Moreover, documents indicating that such a relationship did exist, according to BDO, were falsified and bore forged signatures.
In a statement, Wirecard announced that James Freis, who was recently appointed to the company’s management board, will serve as interim CEO. the Federal Financial Supervisory Authority, known as BaFin, is investigating.
Here is our weekly look at fintech around the world.
Latin America and the Caribbean
Brazil-based SME lender BizCapital raises $12 million in Series B funding to support development of new products.
Banco Sabadell partners with IBM to enhances its digital banking operations in Mexico.
Banco Safra, based in Brazil, to deployACI Worldwide’sUP Retail Payments solution and UP Framework.
Asia-Pacific
Vietnam Plus reports surge in contactless payments in Vietnam.
Crowdfund Insider investigates the rise of Sharia fintech in Indonesia.
Malaysian fintech Curlec, which helps businesses manage recurring payments and cash flow, secures investment from 500 Startups.
Sub-Saharan Africa
South African open banking startup – and FinovateAfrica alum – truIDannounces seed funding.
Nigeria’s Chipper Cash secures $13.8 million in Series A funding.
WapiPay, a fintech based in Kenya and Singapore that provides platform-to-platform integration for virtual and global accounts, raises seed funding via accelerator network FutureHub.
Central and Eastern Europe
Estonia’s Planet42 announces $2.4 million seed round led by Change Ventures. The company helps facilitate automobile access for the underbanked in South Africa.
Russia’s Tinkoffteams up with online marketplace goods.ru.
Bokuacquires Estonia-based mobile payments company Fortumo in deal valued at $45 million.
Middle East and Northern Africa
UAE-based Buy Now Pay Later e-commerce company Postpay introduces a trio of new installment payment options.
The Fintech Times takes a look at the state of the fintech and financial services industry in Lebanon.
Tpay Mobile, based in Dubai, acquires Turkish payments company Payguru.
Central and Southern Asia
Cryptocurrency exchange Binance joins the Indian Tech Association.
Kaspi, an e-commerce banking app based in Kazakhstan, to expand to Azerbaijan and other neighboring countries.
India Infoline launches #IIFLDisrupt, an initiative to help early-stage Indian fintechs during the COVID-19 crisis.
India-based Buy Now Pay Later company Tabby raises $7 million in funding to support expansion into Saudi Arabia.
