Future of FinTech | Edition #36 – Sept 2022
Howdy, FinTech Enthusiasts!
Commemorating the start of the work week with a brewing cappuccino, we are back with the supply of fresh FinTech news in your inbox. Devour the hot cuppa with our Future of FinTech newsletter as we encapsulate the six hot segments packed with bustling news from around the globe.
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Climate Finance in Action: The World Bank Group delivered a record $31.7B in the fiscal year 2022 (FY22) to help countries address climate change. As part of its ongoing effort to help countries integrate climate and development objectives, the organisation recently launched a number of Country Climate and Development Reports (CCDRs), a new core diagnostic to help governments prioritise the most impactful actions to reduce GHG emissions and boost adaptation. Read more here.
Edition #36 is here to spice up your week with seasoned FinTech developments across the globe!
Here's the TL;DR –
Soaring the buzz around the 'Buy Now, Pay Later' services, companies are latching onto the BNPL wagon. Argentine unicorn Ualá has acquired Ceibo Créditos to venture further into the BNPL sector. Further climbing the credit ladder, Indonesia-based Akulaku has partnered with Alipay+ to roll out its BNPL offering. Taking the jump with others, Apple has also added the BNPL feature exclusively for the Apple Pay users with their latest iOS 16 rolling out this September.
If this was not enough, hogging the limelight comes JP Morgan Chase & Co. aiming to take over the Fintech sector by storm. Weighing its decision to buy the fintech start-up Yapily, it is steering its wheels to venture into the open banking sector. Moreover, it has recently launched a green digital platform for investors called the ESG Discovery.
Taking the competition by storm, challenger bank Starling adds bulk payment features to support payroll, supplier payments and employee expenses. On the other hand, Wise rolled out SWIFT International Receive Service that enables clients to facilitate cross-border payments without the required connection with their bank accounts. Riding on a similar wave, Revolut has launched Revolut Pay, an online checkout feature with one-click payment enabling convenience to support payment operations.
While securing credit lines seems difficult, a Latin American start-up Xepelin has bagged a whopping $140M from Goldman Sachs.
Driving on the sustainability wheels, OTP bank has partnered with Cogo to add carbon tracking to its suite of products, further simplifying the carbon credit market.
For the longer read, let's get going –
The Open Finance space was bustling with synergy as partnerships took precedence. Opening doors to new innovative offerings, the following flutter of headlines were grabbed–
Payments FinTech SlimPay entered into a European partnership with Open Banking platform Tink to offer merchants access to open banking powered, account-to-account payments.
Easy4Cloud, specialising in digitising different business areas and simplifying their management, chose Fabrick to expand its offer and introduce BancheinCloud, a Business Intelligence platform for the aggregated management of current accounts through which personal, family and corporate accounts may be linked to enhance administrative work.
Following a report which shows that 82% of businesses fail due to poor cash flow management, Fintech unicorn Pleo formed a strategic partnership with Open Banking platform Yapily to tackle this problem through the power of open banking while also enabling a simplified payments experience for its UK users.
Meanwhile, software management platform LicenceOne partnered with Nordigen to integrate bank data and track user software subscription transactions. This integration adds open banking connectivity to track subscription payments accurately.
And not only that, Vyne was selected to deliver Open Banking payments to Pinewood, providing dealers with an instant payment addition to their digital omnichannel offering.
Moving on to other events, JPMorgan Chase & Co. made the headlines with plans to buy a stake in Yapily, a financial technology startup seeking to raise fresh funds. Banco do Brasil added a payment initiation service to its app, allowing the transfer of funds via PIX from accounts of other financial institutions. On the other hand, financial and banking technology service provider Celcoin launched a white-labelled Initiation of Payment Transaction (ITP) API that can be customised for various use cases.
A series of events conspired in the Digital Finance space as companies move on to accomplish their next goal.
Starting with the new launches –
BaaS provider Griffin launched Verify, a customer onboarding product. It aims to help regulated FinTechs onboard customers at scale while meeting regulatory requirements.
Waya, a Kenya and US-based FinTech startup, released its digital banking and money transfer app targeting the African diaspora. The Waya App will allow users to open bank accounts digitally and send money to other Waya users for free, spend using their Waya cards linked to their Waya account and remit money to over ten countries in Africa.
Wise launched SWIFT International Receive service, bringing SWIFT transfers to neobanks and allowing Wise client institutions to facilitate cross-border payments, even if their bank is not connected to SWIFT.
Moving on to the partnerships front - Alpian, a digital private bank, partnered with Visa to roll out its new metal debit card in Switzerland. This card offers a multi-currency account with real-time foreign exchange features and no handling fees. Carbon Finance and Mambu extended their partnership to grow their financial services offering and also boost their expansion plans. The agreement also enables Carbon to launch Carbon Zero, its new buy now, pay later (BNPL) offering.
In other news -
The Colombian Fintech, Plurall, secured $20M in debt capital from Fasanara Capital, with plans to contribute to the financial inclusion of microbusinesses in Colombia, which are underserved by the financial industry.
British digital lender Atom Bank is scouting for investment banks for its initial public offer (IPO), likely to happen in London in 2023.
Nubank, as part of its larger strategy as per CEO David Vélez, is pursuing non-organic growth opportunities via acquisitions to increase revenue per customer in a bid to compete with large retail banks.
To further sweeten the pot of FinTech tea, Argentine unicorn Ualá was in the news for acquiring Ceibo Credits, a BNPL FinTech. With plans to expand their business and more than 2 million loans in Argentina, Ualá expects the number to grow with this latest acquisition.
Being pressured to improve its internal controls for financial reporting, UK's Financial Reporting Council scrutinised Revolut as the FinTech's audits were flawed and had a high risk of “misstatement”.
Starling Bank added a new feature for its users by enabling Bulk Payments – a subscription-based service designed to support payroll, supplier payments or employee expenses.
The Embedded Finance space remained abuzz with news of numerous partnerships past week.
Let's dive right into it -
Indonesia's Akulaku partnered with China's Alipay+ to allow Indonesian consumers to use its BNPL solution Akulaku PayLater at Alipay+’s global merchants.
Exela Technologies added ClearBank, an enabler of real-time clearing and embedded banking for financial institutions, to its XBP Platform. This collaboration allows Exela to provide its XBP platform and processing services, enabling connectivity to Pay.UK’s interbank Image Clearing System (ICS).
French payment solutions startup Pledg joined hands with Allianz Trade to develop a BNPL solution for B2B eCommerce sites and marketplaces.
SAP Multi-Bank Connectivity added Santander Bank to its partner list to help companies reduce the complexity of embedding financial services into ERP applications.
Sage, an accounting platform for SMBs, teamed up with Square, a global payments technology provider, to help small businesses by integrating Square's point of sale (POS) software with Sage Accounting.
Meanwhile, Inswitch collaborated with Binance Pay to boost crypto payment adoption in LATAM. This partnership provides millions of LatAm merchants with intriguing options in the crypto space, allowing them to increase revenue by accepting crypto and enabling all companies with a new way to service payments.
Lastly, a customer communication platform, Weave, partnered with Sunbit, a BNPL platform, allowing patients to pay for their health care treatments over time in instalments.
Alongside these bustling activities, Apple entered the BNPL space with Apple Pay Later, on its latest release of iOS 16 for iPhone, bringing a new feature to Apple Pay. Dubai-based BNPL platform Tabby also hit the headlines with its expansion into Egypt with plans to tap into the country's rising e-commerce sector by offering consumers interest-free, flexible payment options as the cost of living continues to increase. Additionally, Bond Financial Technologies unveiled a white-label solution that allows B2B SaaS platform providers to launch their own commercial charge cards without writing a single line of code.
The DeFi space continues to spread its wings cautiously, buzzing with launches, bankrolls, and digital attacks:
Looking to widen its product base, Notional Finance is venturing to roll out ‘leveraged vaults,’ a new kind of DeFi product for its users.
On the other hand, Curve Finance will soon launch its native stablecoin, dubbed crvUSD.
On similar lines, X-Metaverse Pro has launched its one-stop DeFi Asset Management Platform to provide investors with trading strategies that capture the volatility of cryptocurrencies.
Pulling through severe economic uncertainty, Forward, a Thailand-based digital asset and blockchain startup, has raised $5M in seed funding.
The DeFi space witnessed a digital storm as New Free DAO faced a series of flash loan attacks, resulting in a reported loss of $1.25 million while the price of the native token dropped by 99%. Nereus Finance was the victim of a similar attack resulting in a loss of $371,000 in USD Coin (USDC).
The Platform Finance sphere was bubbling with news of new launches and acquisitions this week, with exciting product features rolling out —
On its route to becoming a super app, Revolut launched Revolut Pay, unveiling an online checkout feature available as a one-click payment.
Paytm Labs, a subsidiary of tech giant Paytm, has launched Pi, an ML-powered fraud risk management platform.
While in Brazil, Linker rolled out subscription plans, a service for issuing invoices directly from its portal, and an open finance offering.
On the acquisition front, JP Morgan Chase & Co. acquired fintech startup Renovite to keep up with the rising competition in the merchant services sector. In India, the Competition Commission of India (CCI) has cleared PayU's acquisition of BillDesk, after seeking multiple queries over the past year.
The Green Finance world was going strong with news of sustainability as more companies joined hands to protect the earth.
The developments came swarming in the form of launches, partnerships and regulations. Let's take a look:
AXA Investment Managers announced the launch of AXA IM ETF, its new exchange-traded fund platform focused on active strategies and responsible investing for green-conscious investors.
Taking an active step toward the ESG world, JP Morgan Chase & Co. launched ESG discovery, a digital platform that exclusively caters to the demand for a more structured and fundamental ESG view. Also, J.P. Morgan Asset Management launched three new sustainable ETFs - CIRC, UPWD, and BLLD for rising green finance enthusiasts.
Sprinting on the launch game, Morningstar launched the Investable World, a data-driven digital experience designed to make sustainable investing more understandable, engaging and actionable for investors.
Verisk Maplecroft rolled out its new Industry Risk Analytics to provide companies, insurers and financial institutions with a new geospatial risk solution.
Moody's launched a solution to integrate ESG factors into P&C insurance underwriting and the transfer of its sustainable debt Second Party Opinions (SPO) business to become part of its rating agency under Moody’s Investor Service (MIS), from its Moody's ESG Solutions group.
Catching up on the trend to keep up with changing green space, the Government of Oman announced that it is working on an ESG framework that could allow the heavily indebted Gulf oil-producing country to widen its funding base. While on the eastern coast of ‘the land down under’, the Senate approved Australia's Climate Change Bill 2022, the final step to passing the legislation and enshrining the country's emissions reduction targets into law.
On the partnership front, NorthWest Nodes and Glink Solutions partnered to launch the Hyphen Oracle Network, a custom-built Chainlink decentralised Oracle network dedicated to climate information, followed by OTP bank, which partnered with Cogo to add carbon tracking to its suite of products.
Coming to an end, the swarming synergy of acquisition brought the news of EY Canada, which acquired the sustainability consulting firm AFARA.
Some other happenings in the FinTech universe 🪐
Adding a little more caffeine zest to your FinTech tea, a few more notable activities from the bustling world of FinTech are –
Latin American startup Xepelin secured a whopping $140M credit line from Goldman Sachs.
Identity decisioning platform Alloy raised $52M to help FinTechs fight fraud and financial crime.
Business financial management startup Mesh Payments landed $60M in fresh funding with plans to use on its R&D.
And that's a wrap 👋
We hope you enjoyed this edition of the Weekly FinTech Brew, and we'll be back with more next week!
If you're hungry for more FinTech insights, check out some of our other work at WhiteSight.
Our latest publications include witnessing the evolution of Marcus' Expedition from Wall Street to Main Street and journeying through Revolut's Playbook to Build a Global Financial SuperApp.
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