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Finovate Blog
Tracking fintech, banking & financial services innovations since 1994
Halloween is right around the corner. But have no fear of being out of the loop when it comes to the latest in fintech news — Finovate’s Fintech Rundown has you covered!
Deposit and loan origination software solutions provider Amountintroduces its AI Policy Optimizer to enhance credit, pricing, and fraud policy management.
Cryptocurrencies
Cryptocurrency exchange Bitstampsecures a MiFID Multilateral Trading Facility (MFF) license.
Digital banking
U.K.-based banking group Lloydsunveils new Link pay capability in its mobile banking app.
Fall is officially here! A favorite season for many, autumn also marks a likely acceleration in fintech and financial services news and activity. Be sure to check Finovate’s Fintech Rundown all week long for the latest in headlines and news updates!
Nasdaq Verafin announces enhancements to its Targeted Typology Analytics suite to add detection capabilities for terrorist financing and drug trafficking activity.
The partnership will enable Varo Bank to offer a range of new products including digital wallet tokenization via Apple and Google Wallets for its cardholders.
Headquartered in Oakland, California, Marqeta was founded in 2010.
Card issuing platform Marqetahas signed a five-year deal with Varo Bank to serve as the financial institution’s issuer processor. Marqeta’s ability to blend virtual, tokenized, and physical card-issuing technology with faster speed-to-market was among the factors cited by Varo Bank in teaming up with the fintech.
“We sought an issuer partner that complements our unique position as both a technology company and a regulated financial institution,” Varo Bank CEO Colin Walsh explained. “This partnership with Marqeta enables us to offer cutting-edge card issuing technology, giving our customers enhanced ability to view and manage their transactions efficiently. This advancement aligns perfectly with our mission of financial empowerment.”
Widely recognized as one of the first nationally-chartered consumer-based techbanks in the U.S., Varo Bank offers fee-free checking accounts, high-yield savings accounts, secured credit-building credit cards, instant payment solutions, and free ATM access at more than 40,000 locations. Varo Bank’s mobile app enables customers to review and improve their financial health, and now, courtesy of the institution’s partnership with Marqeta, the bank will enable digital wallet tokenization with Apple and Google Wallets for its cardholders.
“Marqeta is proud to announce this deal with Varo Bank, which relies on the latest payments and banking technologies to help Americans who are striving to get ahead,” Marqeta CEO Simon Khalaf said. “Varo’s mission is aligned with ours and we can’t wait to start innovating with the Varo team, enabling their customers to see transactions in real-time thanks to Marqeta’s APIs.”
Marqeta is an alumnus of our developers conference series, FinDEVr. The company presented its technology at our event in Silicon Valley in 2016. In the years since then, the Oakland, California-based fintech has grown into a major, modern card issuing platform operating in 40 countries and processing more than $160 billion in volume in 2022. The company’s partnership news with Varo Bank comes less than a month after Marqeta announced that it had become the first issuer processor in the U.S. that was certified to enableVisa Flexible Credential, a product that provides access to multiple funding sources from a single payment card.
As we enter into the last few days of July, there’s a lot to think about. The days are slowly getting shorter, but the list of tasks needed to complete 2024 objectives by the end of the year isn’t shrinking. Fintech news is set to pick up its pace as summer slows down, and we’ll be here to cover it. Stay tuned throughout the week to read the latest news this week as we post updates and evolutions.
Payments
Marqetabecomes certified to enable Visa flexible credential.
Cybercrime analytics company and Finovate Best of Show winner SpyCloudaddsConsumers’ Risk Module to its Check Your Exposure tool for banks and financial institutions.
In the U.S., the tax deadline kicks off the week, but don’t let that get you down! Sit back, relax, and catch up on some of the latest fintech news headlines. Check back for real-time updates on how the fintech landscape evolves this week.
We’re already well into the second month of 2024, and while funding has slowed down a bit, news in the decentralized finance world has picked up. Take a look at some of the top headlines in fintech and banking this week.
Digital Banking
Israel-based digital bank oneZerounveils its new GenAI-powered assistant, Ella.
Torpago and Marqeta will power Sunwest Bank’s Sunwest Visionary Card.
The new commercial credit card and expense management solution will leverage Marqeta’s modern card issuing API, as well as Torpago’s white-labeled card program solution, Powered By.
The added card program is expected to help Sunwest generate new income streams, attract deposits, and improve operating efficiency.
Two partners in the corporate card space, Marqeta and Torpago, recently announced they will power Sunwest Bank’sSunwest Visionary Card, the bank’s commercial credit card and expense management solution.
Sunwest’s bank-branded credit card program will leverage Marqeta’s modern card issuing API, as well as Torpago’s Powered By, a white-labeled card program solution that aims to help banks enhance their existing card and expense management offerings.
Torpago said that Sunwest considers the card program modernization effort as a “growth engine.” The San Francisco-based company expects that offering corporate card products under the Sunwest brand will help the bank both deepen existing customer relationships and attract new business.
“By equipping Sunwest with a powerful technology platform, we expect Sunwest to generate new income streams, attract deposits and improve operating efficiency.” said Torpago CEO and Founder Brent Jackson. “Working with Sunwest and Marqeta has been fantastic and we are thrilled to be the engine behind the Visionary Card.”
Torpago was founded in 2019 and offers a range of bank-branded, low-code/no-code technologies, including loan origination and underwriting, card issuing and fulfillment, fraud monitoring, web and mobile apps, expense management tools, third-party integrations, and account servicing. The company also provides services for compliance, cardholder support, and collections.
Torpago’s card issuing, spend controls, and card fulfillment available via Marqeta’s APIs. Oakland, California-based Marqeta helps organizations issue credit and debit cards, prepaid cards, virtual cards, as well as digital wallets. Developers can use Marqeta’s APIs to issue cards, fund accounts, manage payments, and more.
“Marqeta is proud to partner with Torpago to give Sunwest the tools it needs to build a truly differentiated solution from the ground up, enabling Sunwest to customize its card program and deliver a highly personalized and smooth experience for their cardholders,” said Marqeta Chief Revenue Officer Todd Pollak.
For its part of the deal, Sunwest is responsible for acquiring customers for its Visionary Card and will be leveraging its own balance sheet. The bank was founded in 1969 and currently has more than $2.7 billion in assets. Headquartered in Sandy, Utah, Sunwest and has offices in California, Arizona, Idaho, Utah, and Florida.
Marqeta launched a new credit card issuing platform to help brands offer embedded credit programs.
Using the new tool, fintechs and non-financial services companies can launch both consumer and commercial credit programs.
Marqeta’s new card program will allow brands to own the entire customer experience without having to send the customer to a bank website to access card information.
Card issuer Marqetaunveiled its new credit card issuing platform today. The new offering serves as a one-stop shop to help companies launch embedded card programs for both consumer and commercial users.
Marqeta’s new credit platform helps brands promote customer loyalty by enabling personalized rewards and can support any card type and any format. According to Marqeta CEO Simon Khalaf, the new platform will help brands “reimagine what a credit card can be” and engage with consumers “in a whole new way.”
As part of that reimagining, Marqeta’s new platform serves as a single location where fintechs and non-financial services companies can build a credit product that suits their consumers’ unique needs and embed the experiences within their existing app. Specifically, brands can own the entire customer experience and won’t need to send cardholders to a bank’s website to access card information.
The credit platform also provides a rewards engine that helps brands build reward programs that adapt to cardholder needs and preference. Additionally, Marqeta offers brands access to real-time customer data to help further customize cardholder products and– for commercial cardholders– provides a range of flexible funding models such as Net 30 Charge Cards, Receivables Purchase, and Revolving Credit.
“The possibility is huge,” Khalaf added, “but the incumbent solutions are simply not giving consumers what they need. We want our credit card platform to completely change the consumer experience and the brand loyalty equation.”
Today’s development comes courtesy of Marqeta’s January 2023 acquisition of Power Finance for $275 million. Power Finance was founded in 2021 to offer brands a credit card program management service. Power Finance’s platform allowed companies to outsource credit card management, customer experience, application decisioning, transaction processing, and more.
Founded in 2010, Marqeta enables clients to manage their own card programs and banking tools. The company offers configurable and flexible payment tools and customizes payment cards for their end customers. Marqeta is a publicly traded company listed on the NASDAQ under the ticker MQ. The company has a market capitalization of $2.83 billion.
Standard Chartered has teamed up with Dubai International Financial Center (DIFC) to launch the fifth cohort of Women in Tech accelerator program. The program is designed to empower female entrepreneurs in the UAE’s technology sector, and encourage innovation, diversity, and economic development. Participants in the program receive training, workshops, mentorship, and access to seed capital. Applications to join the accelerator can be submitted up until the end of July. Ten startups will be chosen to participate. The program ends with a demo day in October, giving each of the startups the opportunity to present their business model to a panel of industry thought leaders and experts, as well as potential investors. The top three startups in the program will be awarded a total of $100,000 in non-equity seed capital.
“By joining forces with DIFC Innovation Hub, we are also taking significant strides toward building a more inclusive and thriving tech ecosystem that supports women-led startups and harnesses the diverse talents and perspectives of women, ultimately shaping a brighter future for all,” Standard Chartered UAE CEO Rola Abu Manneh said.
Eligible companies must have a gender-diverse team. This includes a minimum of one female co-founder. Companies must demonstrate an innovative and scalable solution, as well as the technology’s sustainable impact. The program is for UAE-based startups only.
CFI Financial Group has partnered with Finovate Best of Show winner Capitalise.ai to bring AI-enabled, automated trading to clients in the Middle East. Capitalise.ai leverages code-free automation to enable traders and investors to implement their trading strategies more accurately and reduce human error. Capitalise.ai’s platform enables traders to plan trades in advance as well as take advantage of preset trading strategies. The platform then automatically executes trading decisions based on parameters decided in advance by the trader. This helps ensure that the trades taken are both timely and accurate.
In addition to executing trades, the Capitalise.ai platform also monitors the market for potential trading opportunities based on pre-set parameters. The platform notifies users when specific market conditions line up with their trading strategies, alerting them to potential opportunities in the market.
Capitalise.ai co-founders Shahar Rabin (Chief Product Officer) and Amir Shiovich (Chief Executive Officer) at FinovateSpring 2017.
“We are excited to introduce Capitalise.ai as a game-changer in the MENA trading landscape,” CFI Financial Group co-founder and MD Hisham Mansour said. “By offering this code-free AI trading technology, we are empowering our clients with the ability to automate their trading strategies effortlessly.”
Founded in 2014 and headquartered in Tel Aviv, Israel, Capitalise.ai demoed its trading automation technology at FinovateSpring 2017, winning Best of Show. In the years since then, Capitalise.ai has forged partnerships with crypto spot and regulated futures market ErisX, accounting software company Clear Books, U.S. spot FX trading platform Forex.com, and CFD/Forex broker AvaTrade. Capitalise.ai has raised $10 million in funding, and includes Poalim Equity and Binance among its investors. Amir Shiovich is co-founder and CEO.
Egyptian cashless payments app Flash secured $6 million in seed funding. The round was led by Addition, and featured participation from Flourish Ventures as well as other angel investors. The company will use the capital to accelerate product development, as well as customer and business acquisition in Egypt. Additionally, Flash has secured approval from the Central Bank of Egypt – in partnership with Banque Misr – to serve as a technical payment aggregator.
Flash gives consumers and businesses a cashless payment option via a scan-and-pay service. By adding their existing bank card or digital wallet to the Flash app, consumers can make purchases using their phones simply by scanning the QR code provided by the business. Flash enables businesses to accept payments from consumers directly without requiring point-of-sale (POS) systems or complex technical integrations.
Uber alumni Erik Gordon and Sherine Kabesh founded Flash in 2021. “Our mobile application removes transactional challenges for businesses looking for an easier solution than the POS,” Gordon said. “Our goal is to make payments easier, safer, and faster for everyone. We are also excited to be releasing new features to help consumers make better spending decisions.”
Here is our look at fintech innovation around the world.
Asia-Pacific
Stag, a financial education-related startup based in Vietnam, raised $600,000 in seed funding from Viet Capital Ventures, NH Securities Vietnam, and Singapore-based Resolution Ventures.
Hong Kong-based fintech Eddid Financial signed an agreement with Malaysian fintech MPAY establishing a joint venture to boost fintech expansion in Malaysia.
South Korean fintech U Fintech Hub secured $4 million in funding in a round led by Forest Partners.
Sub-Saharan Africa
Ten Southern African fintech startups received grant funding from the World Bank as part of the Fintech Challenge initiative of the Southern Africa Innovation Bridge Portal.
African paytech Flutterwave launched a new payment solution, Tuition, to enable users to pay for educational fees using local currencies.
Global Brands Magazine recognizes Access Bank Mozambique as “Best Banking Brand” based on customer service, satisfaction, and digital innovation.
International remittance company Viamericas Corporation launched new program with Guatemala-based financial organization Banco GyT to promote financial inclusion for people with severe disabilities.
As the going gets tough for crypto, will the underlying blockchain technology get going?
That was one of the top takeaways from the conversation on cryptocurrencies, digital assets, and the blockchain at FinovateEurope in London last week. We may be in a crypto winter – if not, as author Steven Van Belleghem quipped during his keynote address, a crypto “ice age.” But while the sun may be setting on the initial promise of cryptocurrencies, a dawn of new use cases and novel user interfaces may arrive sooner than we think.
To that end, it is interesting that much of this week’s crypto news revolves around stablecoins and ways that innovative banks and fintechs are using the technology to better serve customers.
Xapo Bank partners with Circle to leverage USDC as Swift alternative
One example of this trend comes in the news that Xapo Bank has teamed up with Circle to become the first licensed bank to integrate USDC payment rails as an alternative to SWIFT. The partnership will enable the Bitcoin custodian and private bank to offer its members the ability to make deposits and withdrawals via the USDC stablecoin without having to pay any fees to Xapo Bank. The institution is offering a 1:1 conversion rate from USDC to USD, further helping its customers avoid both the time and cost of SWIFT-based payments.
“Xapo Bank’s USDC payment rails mark a watershed moment in financial history, combining the speed and cost efficiency of the digital dollar, with the security guarantees of a licensed private bank,” Xapo Bank CEO Seamus Rocca said. “Enabling auto converted USDC deposits and withdrawals at Xapo Bank gives crypto members a safe haven for their savings.”
USD deposits are guaranteed up to $100,000 courtesy of Xapo Bank’s membership in the Gibraltar Deposit Guarantee Scheme (GDGS). The bank noted that all USDC deposits are automatically converted to USD, giving members a 4.1% annual interest rate return on deposits.
Stables issues USDC-to-fiat Mastercard powered by Marqeta
A new partnership between card issuing platform Marqeta and Stables, a stablecoin-based digital wallet formerly known as Tiiik, will enable Stables customers to convert stablecoins into fiat currency and spend wherever Mastercards are accepted, online or in-store. Stables will leverage Marqeta’s dynamic spend controls and Just-in-Time funding capabilities to give its customers broader ability to transact with their stored stablecoins.
“Stables is committed to expanding what’s possible with stablecoins, giving people more flexibility and choice in their payment habits,” Stables co-founder and CEO Erez Rachamim said. “With increasing demand for digital assets, we’re thrilled to work with Marqeta to develop a card that enables more seamless spending on everyday items.”
Headquartered in Sydney, Australia and founded in 2021, Stables rebranded from tiiik at the beginning of this year. In a statement at the company blog, co-founder Bernardo Bilotta wrote, “This update better encapsulates what we can plan to offer to our loyal community. It highlights our dedication to expanding our focus to solve stablecoin related payment problems and any new use cases/services built around stablecoins.”
Circle supports USDC; sets up European HQ in France
We mentioned Circle earlier with regard to Xapo Bank’s new payments offering. Circle also made crypto headlines for its decision to set up its European headquarters in what it referred to as the “crypto-friendly climate” of France. The company, founded in 2013 and maintaining a U.S.-based headquarters in Boston, Massachusetts, has applied to French regulators to become both a licensed Electronic Money Institution (EMI) and a fully registered Digital Assets Service Provider (DASP). Securing these approvals would make Circle the first company to receive full authorization under the DASP regulatory regime.
“France’s comprehensive efforts towards innovation-forward crypto regulation are commendable and closely align with Circle’s vision for the future of the digital payments sector,” Circle CEO and co-founder Jeremy Allaire said. “The DASP registration provides an initial path to support sensible digital asset innovation.”
Circle is the issuer of the USDC stablecoin. The company has come under pressure in the wake of the Silicon Valley Bank crisis as its relationship with another troubled bank, Signature Bank, limited its ability to process minting and redemption of USDC. A de-pegging of USDC, in which the stablecoin lost its one-to-one relationship to the U.S. dollar resulting in investors cashing out of the digital asset by more than $2.6 billion in 24 hours, only added to the company’s woes of late.
Centi launches Swiss franc stablecoin
Swiss fintech Centi, which was founded in 2020, has announced the launch of its Swiss Franc pegged stablecoin. The stablecoin is backed 1:1 by a Swiss bank, and will serve as the foundation for the company’s Global Payment Network. The new offering will enable merchants to get direct payment settlement in their bank accounts in the fiat currency of their choice. Merchants will not need to make any changes to their current accounting processes nor do they need to have extensive cryptocurrency knowledge. Centi noted that its stablecoin will help bring buying power to both buyers and sellers by eliminating the fees and costs charged by credit card companies.
Centi’s Global Payment Network leverages a low-cost transaction model based on a micropayments facilitation foundation. This enables the network to offer the advantages of both cash and electronic payments, as well as seamless integration with online, POS, and cashier payment systems. By leveraging blockchain technology, the network is able to offer fees that are as much as 90% less expensive compared to competing payment services.
“With Centi we have created a new payments universe,” Centi CEO and founder Bernhard Müller said. “Our technology uses the efficiency of the blockchain to lower payment processing fees without requiring users to understand anything about crypto. Our payments solution is a first use case implementation of this technology with many others expected to follow it.”
LiquidStack raises capital to help lower carbon footprint of bitcoin mining
One of the earliest antagonists to the bitcoin and cryptocurrency movement were environmental activists who decried the impact of bitcoin mining on the environment.
This week we learned that LiquidStack, a Massachusetts-based immersion cooling company, has secured Series B funding to build a manufacturing facility in the U.S. Moreover, the firm says that is has a solution, at least in part, to bitcoin mining’s carbon footprint problem. The company boasts the largest install base of liquid cooling for data centers around the world, and has been proven to meet the thermal challenges of cloud, high performance computing, and crypto-mining applications.
The Series B investment came from Trane Technologies, and the amount of the funding was not disclosed. LiquidStack said that it will use the capital to accelerate manufacturing, including the opening of a facility in the United States. LiquidStack CEO Joe Capes noted that the investment from Trane Technologies comes “at a time when demand for sustainable liquid cooling technology has never been greater.”
LiquidStack’s two-phase immersion cooling process reduces data center direct and indirect carbon footprint by more than 1,500 tons per megawatt compared to air cooling. The company’s technology can also be used to reduce the amount of water used to power and cool data centers by more than 300 billion liters per year.
Marqeta is acquiring credit card program management platform Power Finance.
The company will add Power Finance’s credit card program management capabilities to its own card issuing platform.
Financial terms of the deal were not disclosed.
Global card issuer Marqeta agreed to acquire credit card program management platform Power Finance. Terms of the deal, which is scheduled to close in the first quarter of this year, were not disclosed.
Power Finance was founded in 2021 by CEO Randy Fernando and CFO Andrew Dust to offer credit card program management services to companies seeking to create new credit card programs. The company’s platform takes care of credit card management, customer experience, application decisioning, transaction processing, and more. And because Power Finance is pre-integrated with third-party data vendors, it saves companies time when setting up KYC and underwriting processes.
“Companies like ours were made possible because of the path Marqeta blazed in modern card issuing, demonstrating the possibilities in payments with flexible and modern payment infrastructure,” said Fernando. “At Power, we built a full-stack, cloud-native credit card issuance platform, and by becoming a part of Marqeta we have the ability now to bring this innovation to a much larger market at global scale.”
Once the deal is finalized, Fernando will lead the product management of the Marqeta credit card platform.
Marqeta will leverage the acquisition by adding Power Finance’s credit card program management capabilities to its own card issuing platform. “It will allow us to accelerate processing revenue derived from credit programs, and improve our competitive positioning when competing for new deals, offering our customers a holistic credit card program management solution,” Marqeta said in a blog post announcement.
Marqeta launched its card issuing platform in 2010 to enable clients to manage their own card programs. The company offers configurable and flexible payment tools and customizes payment cards for their end customers. Earlier this month, Marqeta launched a Web Push Provisioning Solution to enable consumers to transact from their mobile wallets without having to download a separate mobile app.
Marqeta is a publicly traded company listed on the NASDAQ under the ticker MQ. The company has a market capitalization of $3.54 billion.
Card issuing platform Marqeta launched its new web push provisioning solution.
The new offering will enable consumers to pay for products directly from their mobile wallets without having to first download a mobile app – that may be rarely used again.
The web push provisioning solution was inspired in part during Marqeta’s Hack Week event back in October 2021.
Modern card issuing platform Marqetalaunched its new web push provisioning product this week. The new offering will reduce friction at the point-of-sale by enabling users to pay for purchases directly from their mobile wallets without having to download a mobile app first.
The new web push provisioning product is designed to address a major pain point for consumers: having to download an app – that may be rarely, if ever, used again – in order to complete a given transaction. Marqeta’s solution can help boost conversion rates by eliminating this requirement and thus streamlining the customer experience. Combined with Marqeta’s instant issuance capabilities, this week’s announcement reinforces and adds to the company’s leadership in the payment card tokenization space.
“Growing familiarity with digital wallets created demand for a solution that enables Marqeta customers to quickly and easily provision virtual cards and digital wallet tokens from the web for use with both Apple Pay and Google Pay,” Marqeta Chief Product Officer Simon Khalaf explained. “Our web push provisioning product meets that need and helps enable our customers to deliver a streamlined checkout experience to their end users.”
Marqeta’s offering comes as consumer adoption of digital wallets continues to show strength. According to Juniper Research, global digital wallet transactions are expected to grow 60% by 2026. Additionally, 71% of U.S. consumers in 2022 say that they have used a mobile wallet in the previous 12 months compared to 64% in 2020. Nevertheless, 75% of consumers admit to having abandoned a transaction after being prompted to download a mobile app in order to complete the purchase.
Marqeta’s web push provisioning solution, currently in beta and expected to be generally available later this year, was specifically designed to address this problem. The technology has its origins in a Hack Week event from last year, as members of Marqeta’s team realized the value of enabling brands to provision tokens from a mobile web browser. Built in partnership with both Apple and Google, the web push provisioning technology has been deployed by Bread Financial, which praised the way the product enabled the company to “offer flexible payment options that will keep the merchant’s brand at the forefront a deliver a better experience for the customer,” according to Bread Financial EVP and Chief Commercial Officer Val Greer.
An alumni of Finovate’s developer conference, FinDEVr SiliconValley 2016, Marqeta today is certified to operate in 40 countries around the world. Last fall, the company announced the launch of its Marqeta for Banking offering, which brought new banking capabilities to the company’s card issuing platform. Marqeta has forged partnerships in recent months with Raiffeisen Centrobank to power the institution’s new digital banking brand for customers in Poland and Romania – and with Blockchain.com, to power the cryptocurrency platform’s crypto-based Visa Card.
Headquartered in Oakland, California, Marqeta was founded in 2010. The firm is a publicly traded company on the NASDAQ under the ticker MQ, and has a market capitalization of $3.4 billion. Jason Gardner is CEO.
