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Tracking fintech, banking & financial services innovations since 1994
P2P lender and challenger bank Zopa recently formed a partnership with Paylink Solutions to tap into the company’s cloud-based digital income and expenditure product, Embark.
Paylink’s Embark will help Zopa quickly find the most suitable loan product for clients by understanding their affordability. The tool taps into credit report data and leverages open banking technology to offer lenders a 12-month view of customer bank statements. Embark also provides identity verification and document upload technology.
“Teaming up with Paylink Solutions to deploy the Embark tool at this time has enabled us to provide an even better experience for our customers,” said Zopa Chief Customer Officer Clare Gambardella.
The partnership is part of Zopa’s initiative to increase its digital efforts. Embark will enable Zopa’s potential borrowers to use the self-service portal or use an online form with the help of a live customer service agent.
With Embark, Zopa customers also have access to free debt advice. Customers can self-refer to PayPlan, a U.K.-based debt help tool that provides personalized debt management plans.
“From day one, we have seen Zopa’s customers referring themselves to PayPlan; this is in an age where customers want to self-serve more,” said PayPlan’s Head of Partnerships, Andrew Alder. “It’s becoming more important for organizations, solution providers, and debt advice providers to work closely to create innovative ways for customers to still be able to access advice in a frictionless way.”
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:
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:
Paymenow (South Africa)
Mango Life (Mexico)
“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.
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.
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.
While rumors have been circulating for days, Zopaconfirmed today that it has raised $182 million (£140 million) in its largest fundraising to date. The capital comes from IAG Silverstripe, the investment division of IAG Capital, and will, in the words of Zopa CEO Jaidev Janardana, enable the P2P lending pioneer to fulfill the regulatory capital requirements and lift restrictions on its banking license.
“This new funding means we have concluded the fundraising phase of our bank mobilization,” Janardana said. “Definitive agreements to provide the funding have been finalized and are subject to final approvals including regulatory change of control.”
IAG Silverstripe has been an investor in Zopa since the fall of 2018, and holds a minority stake in the company. Zopa noted that its bank will operate along with its current P2P financing business (Zopa Limited) as part of the larger Zopa Group.
The funding for Zopa arrives at an opportune time for the company, which will celebrate its 15th anniversary next year. Granted an “Authorisation with Restriction” by U.K’s Financial Conduct Authority on December 4, 2018, Zopa had twelve months to meet the capital requirements that would enable the company to go ahead with a full launch. Even as the deadline drew near last week, Zopa representatives expressed confidence in the company’s ability to raise the necessary capital.
“We continue to hold our bank license with restrictions and are working closely with the regulators to gain our full license,” Janardana explained. “We are excited that, once approved, Zopa will be able to launch its bank alongside its peer-to-peer business and offer a broader set of products to our customers.”
One of Finovate’s earliest alums, the company demonstrated its P2P lending platform at FinovateSpring 2008, billing itself as the “world’s first social finance company,” In the years since its founding in 2005, Zopa has lent 5 billion pounds in unsecured personal loans to customers in the U.K. Headquartered in both New York and London, the company launched a new savings solution last month that offers a fixed-term account with 4% interest as part of its entry into the world of banking. In October, Zopa introducedBorrowing Power, a new offering that uses AI to help customers see what determines their personal borrowing power.
P2P lending company and newly initiated challenger bank Zopa is taking a first step on its banking journey with the rollout of a new savings product. The U.K.-based company is launching fixed-term savings accounts that will be available for terms of one month and pay 4% interest.
This news comes after the company received partial authorization from the Financial Conduct Authority (FCA) last December and launched bank products with its staff as beta testers. This partial authorization is the reason behind the limited nature of the savings accounts. Zopa is currently operating in a period called AWR (authorization with restrictions), meaning the company has met all of the FCA’s conditions and is allowed to begin testing bank products.
Under those restrictions, Zopa cannot accept more than $64,000 (£50,000) in customer deposits, so it is only inviting 200 current investors to test out the new savings product. There is no word yet on when the restrictions will be lifted.
“Inviting existing customers to test our Fixed Term Saver is a major milestone in our bank journey,” said Zopa CPO Didier Baclin. “It is a great opportunity to ensure that the product meets their expectations before the full launch next year so that we deliver a great product that customers can trust.”
Zopa’s choice to start its bank product offerings with a high-interest savings account doesn’t come as a surprise. As we covered last month, multiple fintechs are offering high interest bearing accounts in order to attract customer deposits away from their primary, traditional bank.
Last year, Zopa closed a $77 million (£60 million) investment round that contributed to the company’s total of $297 million in funding it’s received since launching in 2005. Zopa is seeking to raise additional funding this year, stating that the fresh capital will offer the boost it needs to have the FCA’s restrictions removed.
Zopa’s former CEO Doug Dolton debuted the P2P lending platform at FinovateSpring 2008 at Finovate’s very first show in the Bay Area. The company was founded in 2005, pioneering peer-to-peer lending in the U.K., and has since amassed 400,000 customers and facilitated $5 billion (£4 billion) on its platform.
P2P lending company and challenger bank Zopaannounced something consumers can feel good about this week. The U.K.-based company, which brands itself as the FeelGood Money company, launched a tool to help borrowers find the best rate for their loan.
The new tool, Borrowing Power, leverages AI to show users what makes up their personal borrowing power and guide them toward actions to help improve it. Each score is linked to a Zopa loan and shows the user their eligibility and rate. Borrowing Power also shows users what-if scenarios– that is, how their rate may increase if they take certain actions to improve their score. Ultimately, the tool has the potential to positively impact consumers’ financial behavior.
“Customers deserve to know their eligibility for credit, current credit scoring is merely scratching the surface,” said Zopa CPO Didier Baclin. “We have effectively broken open the black box to understand what is going on and, combining this data with additional information about the customer, are able to give bespoke actionable insights to our customers that could enable them to improve their credit risk in a short time frame and then ultimately be able to borrow from Zopa at a better rate.”
The Borrowing Power score, which ranges from one to 10, is simpler than a credit score. The score is comprised of only five elements:
Combination of credit rating data
Affordability based on personal circumstances
Zopa leverages this data to inform consumers if they can improve an aspect of their credit profile, and in what time period. The company makes it easy for borrowers to understand the loan by showing them the actual interest rate. And, making the score as consumer-friendly as possible, Zopa only uses a soft credit inquiry so that it doesn’t impact their credit score until the loan is official.
Zopa was founded in 2005, pioneering peer-to-peer lending in the U.K., and has since amassed more than 400,000 customers and facilitated $5+ billion (£4+ billion) on its platform.
Last December Zopa made fintech headlines by launching its new bank in beta. The company is currently operating the bank in a period called AWR (authorization with restrictions), meaning it has met all of the FCA’s conditions and is allowed to begin testing the new banking products.
Zopa’s former CEO Doug Dolton debuted the P2P lending platform at FinovateSpring 2008 at Finovate’s very first show in the Bay Area.
Just over two years ago, P2P lending company Zopaannounced its plans to launch a challenger bank. Today, the U.K.-based company announced it received authorization from the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA).
Zopa is currently operating in a period called AWR (authorization with restrictions), meaning it has met all of the FCA’s conditions and is allowed to begin testing the new banking products. The company will use its own staff to serve as the beta testers for the new banking products.
There is no word yet on when the restricted period will be lifted to allow Zopa to fully launch, but when it does, it will offer savings accounts and credit cards that can be managed within a new mobile app. The app will offer money management tools that help place customers in control of their finances by showing all of their accounts in a single place.
To position itself as more user friendly than traditional banks, the company is branding itself as the Feelgood Money company. Backing this ideal, Zopa is avoiding hidden fees and promising to have “helpful humans” on the other end of customer service calls.
“This is a huge milestone for Zopa as we are now the world’s first combined peer-to-peer lender and digital bank,” said Zopa CEO Jaidev Janardana. “It also brings us one step closer to being the best place for money in the U.K. by offering a broader selection of personal finance products.” Janardana discusses what’s next for Zopa in the video below:
Zopa was founded in 2005, pioneering peer-to-peer lending in the U.K., and has since amassed 400,000 customers and facilitated $5 billion (£4 billion) on its platform. The company plans to continue to grow its peer-to-peer platform, which will run alongside Zopa’s bank offerings.
Zopa’s former CEO Doug Dolton debuted the P2P lending platform at FinovateSpring 2008 at Finovate’s very first show in the Bay Area. Last month, the company added $20.7 million to its Series G funding round, bringing its total funding to more than $77 million. Earlier this fall, Zopa earned recognition on the Inc. 5,000, ranking 1,314.