Future of Fintech | Edition #94 – Nov 2023
Fintech Pulse: Weekly Digest (Oct 31st-Nov 5th)
Greetings, Fintech Explorers! 👋
As we rev up for the next fintech adventure, let's take a look at the amazing financial chronicles of last week. From traversing the dynamic fintech landscapes of Europe to blazing a trail through the scorching fintech frontiers of the Middle East, we've been on quite the adventure. So, grab your espresso, power up your digital devices, and fasten your seatbelts. We're about to embark on another exhilarating voyage into the realm where financial technology and innovation converge, where groundbreaking ideas are nurtured, and the dawn of a fintech renaissance beckons on the horizon. ☕
Unlocking Credit's Hidden Secret: Plaid's Cash Flow Revolution
In a financial landscape where traditional credit scores often paint an incomplete picture, Plaid has emerged as the trailblazer of change. The company has recognised the importance of data beyond the numbers on paper, like savings, income, and on-time rent payments. To address this critical gap, Plaid has introduced a separate entity dedicated to harnessing consumer-permissioned cash flow data. This entity operates as a consumer reporting agency, providing lenders with a treasure trove of invaluable credit risk insights.
The result? A newfound ability to make smarter lending decisions and a deeper understanding of borrowers' financial lives. This innovative approach not only transforms the lending process but also has the power to expand credit access in meaningful ways. Plaid has truly opened the door to a financial future where lenders can focus on their core strengths, whether that's extending loans, servicing borrowers, or screening potential tenants, all while being armed with comprehensive and actionable cash flow insights! 💸
Fasten your seatbelts, because we're about to embark on an electrifying journey into the world of fintech - Edition #94.
Here's the TL;DR
Over the past week, significant strides were made in the domain of payment enhancements. Amazon extended its partnership with Affirm to offer a pay-over-time option, while Adyen joined forces with Plaid to introduce a Pay-by-Bank feature in North America.
Prominent figures in the banking industry created a buzz as the Abu Dhabi Securities Exchange and HSBC Bank Middle East joined forces to innovate digital fixed-income securities. Simultaneously, BBVA grabbed headlines by participating in Atom Bank's latest $100M capital round.
In the pursuit of improving the trading experience, Revolut launched Trading Pro, catering to advanced traders in the EEA region. Furthermore, CQUR Bank forged a partnership with Finastra to enhance its digital banking and trade finance services.
With a keen focus on enhancing their capabilities, The Travelers Companies acquired Corvus Insurance Holdings to leverage cutting-edge cyber capabilities. In addition to this, Walmart Canada teamed up with Klarna to provide flexible BNPL payment options.
Embracing the spirit of innovation, Ripple established a partnership with the National Bank of Georgia to conduct a digital Lari pilot. Simultaneously, Dwolla introduced Open Finance integrations to their latest solution, Dwolla Connect.
For the longer read, let's get going –
Embark on the realm of Open Finance, as visionary collaborations unfurl their sails on the open tech vessel, steering towards solutions for merchant pain points worldwide.
Canadian fintech company Nuvei and American Express have partnered to enhance account-to-account payments between merchants and their clients. In this regard, Pay with Bank transfer, powered by American Express (PwBt), selected Nuvei as its acquirer authorised to promote and sell PwBt’s Open Banking-enabled payment method.
Australia-based Waave partnered with Merco to provide continuity to POLi-affected merchants by introducing an Open Banking alternative. In September 2023, POLi, a real-time online debit payment method, closed its operations in Australia. Through this, Australian merchants can leverage their existing POLi integration and substitute the payment method for Pay by Bank, thus eliminating the need to integrate with an alternative service.
Jump into the boundless digital world of Digital Finance, where fintech pioneers from around the world rocked the boat with their game-changing innovations!
As part of ZA Bank's commitment to supporting Hong Kong's Web3 technology development, the bank opened an operating account for OKX Hong Kong. The ZA Bank operating account facilitates OKX Hong Kong's daily banking needs, bolstering their application to the Securities and Futures Commission for the Virtual Asset Trading Platform (VATP) license.
Kuwait Finance House launched a Shari’a-compliant digital bank in Kuwait called Tam Digital Bank. The new digital bank offers instant mobile onboarding to a youth-oriented savings account for managing student allowances and transfers.
Last week in the dynamic realm of Embedded Finance, the Middle East fintech scene took the spotlight and made some serious financial waves!
Saudi-based BNPL platform Tabby secured $200M in Series D funding, achieving a valuation of $1.5B valuation, making it the region's first fintech unicorn. The company plans to use funds to enhance its finances and shopping products for both consumers and retailers.
First Abu Dhabi Bank entered a strategic partnership with Mastercard to launch the SlicePay card under its Dubai First trademark in the UAE, marking the debut of the Mastercard Installments Program in the Eastern Europe, Middle East and Africa (EEMEA) region. This will allow shoppers to convert their purchases into four interest-free instalments.
In the vibrant world of Fintech Infrastructure, fintech enthusiasts rolled up their sleeves to tackle consumer pain points.
GoCardless extended its partnership with Rebel Energy to help it better identify customers who may be in financial difficulty and to prevent disruption to service. Rebel Energy added Success+, a feature using proprietary GoCardless machine learning models to automatically optimise failed payment retries, to the services it uses from the fintech.
Canada-based fraud detection company Paays partnered with UK-based digital identity company Yoti to minimise identity fraud in auto financing. This partnership aims to integrate Yoti's identity verification technology with Paays ID Verifier solution to improve customer experience, reinforce identity checks, and mitigate the risk of fraud in the context of auto finance applications.
Join the thrilling universe of Green Finance, where fintech innovators steal the spotlight in Europe and the Middle East, steering the financial ecosystem toward a sustainable future!
BNP Paribas and The EIB Group (European Investment Bank, EIB, and European Investment Fund, EIF) signed a “green securitization” agreement, aimed at financing home energy efficiency investments and supporting the transition to climate neutrality.
Abu Dhabi Islamic Bank unveiled its Sustainable Finance Framework, setting criteria for project financing and refinancing eligibility. The framework establishes criteria and eligibility requirements that determine which projects are labelled “green”, “social”, or “sustainable”.
Over the past week, the incumbent banks doubled down on web3 and asset tokenization initiatives. These moves suggest a strategic emphasis on embracing the next evolution of the internet - one that incorporates concepts like decentralization, blockchain, and digital asset ownership and indicates their commitment to integrating these innovations into traditional finance.
HSBC launched a platform that uses distributed ledger technology (DLT) to tokenise the physical gold of institutional clients, stored in its London vault. The platform will allow each token, equivalent to 0.001 troy ounces of the client's physical gold holdings, to be traded between the bank and investors.
The Union Bank of the Philippines secured a Certificate of Authority from the Bangko Sentral ng Pilipinas (BSP) to operate as a virtual asset service provider (VASP). With the VASP license, UnionBank will be able to tap into new markets and opportunities, explore new ways of addressing evolving client needs like never before, and remain at the forefront of technological advancements ensuring its competitiveness in the digital financial space.
Some other happenings in the fintech universe 🪐
Craving for some more quick fintech nibbles to savour alongside your tea? Get ready to dig into a delectable spread of tantalising headlines!
QI Tech, a Central Bank-approved Direct Credit Company in Brazil, secured a $200M Series A round to boost product expansion and explore strategic M&A prospects.
Luxembourg-based FinTech Mangopay obtained an Electronic Money Institution approval by the U.K. Financial Conduct Authority. This license expands the B2B payment infrastructure provider's services, including e-money issuance, digital payments, and various payment solutions, to UK-based businesses.
Africa-based payment platform Paystack obtained the required regulatory approvals to launch its services in three new markets: Egypt, Rwanda and Côte d’Ivoire.
Funding Societies raised $7.5M in debt from Norfund, a Development Financial Institution (DFI) to fuel financial inclusion for SMEs in SEA.
And that's a wrap 👋
We hope you enjoyed this edition of the Weekly Fintech Brew!
If you're hungry for more fintech insights, check out some of our other work at WhiteSight.
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