True North: A Celebration of Canadian Fintech

Canada Day is this week, July 1st. The holiday – colloquially considered by some to be Canada’s “birthday” – celebrates the decision of three provinces in 1867 – modern-day Nova Scotia, New Brunswick, Ontario, and Quebec – to unify and form the country we now know and love as Canada.

Last year, we launched our inaugural recognition of fintech companies – Finovate alums all – who were founded in or operate out of Canada. From Calgary, Edmonton, and Montreal to Ottawa, Toronto, and Vancouver, Canadian fintechs have gained a reputation for cutting-edge innovation in everything from helping small businesses secure critical financing during the COVID pandemic to advancing new use cases for the latest cryptocraze: non-fungible tokens (NFTs).

Today, we honor Canada Day with a salute to those Canadian fintechs that have joined the Finovate family since our last reporting from the Great White North.

Boss Insights (Toronto, Ontario) – demo – Business-data-as-a-service innovator bridging the data gap between banks and their business customers.

Coconut Software (Saskatoon, Saskatchewan) – demo – Customer engagement platform for financial institutions to enhance the digital and physical engagement of both staff and customers.

Dbilia (Vancouver, British Colombia) – demo – A digital memorabilia marketplace that leverages Blockchain technology and NFTs to empower creatives and enable fans to purchase their work. Best of Show winner.

FormHero (Toronto, Ontario) – demo – A low-code SaaS platform that helps enterprises build intuitive, digital front-end experiences to help them manage and orchestrate complex data collection. (Vancouver, British Colombia) – demo – An AI-driven analytics platform to enhance small business lenders’ loan origination processes with instant cash flow analysis, automated underwriting, as well as continuous monthly monitoring and real-time reporting.

We also saw the return of Flybits this spring. The Toronto-based company demonstrated its MyCard solution that consolidates all of a bank’s products and services on the bank’s existing mobile app and provides dynamic recommendations tailored to the customer’s needs.

Looking to FinovateFall in September, what can we expect from fintech’s Canadian contingent? This week we introduced the first wave of demoing companies for our annual fall fintech event and were happy to see that Finovate veteran Cinchy, from Toronto, Ontario, will be back. With FinovateFall marking the return of live demos after more than a year in a digital-only format, we can’t wait to see what other innovative Canadian fintechs will join in the fun.

Photo by Andre Furtado from Pexels

Movers and Shakers: Truist gets new investment banking head, Jack Henry hires new sales lead

First Internet Bancorp, Truist Securities and City National Bank were among the financial institutions that announced fresh hires and shuffled executives this month: City National Bank taps Montanez for private banking City National Bank, a subsidiary of Toronto-based Royal Bank of Canada, has hired Abel Montanez to lead the bank’s private banking businesses. Montanez joined […]

The Fed’s Quarles points to downsides of digital currency

U.S. Federal Reserve Vice Chair for Supervision Randal K. Quarles made disparaging remarks about a potential U.S. central bank digital currency (CBDC) on Monday, pointing to the risk involved with its rollout during a speech at the 113th annual Utah Bankers Association Convention in Sun Valley, Idaho. A CBDC could have a significant impact on […]

Formation of Rent Reporting Technical Assistance Centre To Grant Credit to Low-Income Renters

One way we begin to eliminate the racial wealth gap in America is by helping consumers build their credit profile; especially for those who have poor credit scores or no credit scores at all.

Opening doors to credit-building opportunities can make a difference. Rent reporting – the reporting of tenants’ rental payments to the credit bureaus – is a proven credit building strategy that spurs economic mobility for low-income renters.

Fueled by years of positive rent reporting results, Credit Builders Alliance (CBA) is creating a Rent Reporting Technical Assistance Centre (RRTAC) with underwriting support from Experian. The centre aims to reduce barriers for affordable housing providers to adopt this impactful strategy and foster the industry collaboration needed to scale it.

Dara Duguay, CEO, CBADara Duguay, CEO, CBA
Dara Duguay, CEO, CBA

“CBA’s Rent Reporting Technical Assistance Centre will function as a one-stop-shop to assist landlords for low-income tenants. Coupled with extensive technical assistance provided by CBA, the affordable housing providers will have a road map and guidance for adding rent reporting to their operations,” comments Dara Duguay, CEO CBA.

Unlike homeowners, renters historically have not gotten ‘credit’ on their credit reports for making their monthly housing payments. Many of these renters are also more likely to:

  • have lower-income and hold less wealth than homeowners:
    • renters account for nearly 60% of all U.S. households with incomes under $25,000 per year.
  • be households of color:
    • Black and Hispanic households are twice as likely as White households to rent.
  • lack of enough credit history to generate a credit score:
    • renters are seven times more likely to be credit invisible compared to homeowners.

For these households, lack of access to credit can inhibit their ability to overcome financial challenges and pursue economic mobility. Many have limited opportunities to build a credit history, which directly impacts their ability to get ahead in today’s economy. As a proven strategy for establishing and building credit, reporting rental payments offers low-income renters a safe and easy opportunity to build credit without taking on additional debt.

Craig Boundy, CEO, Experian North AmericaCraig Boundy, CEO, Experian North America
Craig Boundy, CEO, Experian North America

“At Experian, we believe everyone deserves access to fair and affordable credit,” comments Craig Boundy, CEO Experian North America. “This CBA programme is a tangible step in helping marginalised communities, and we are proud to work with them on this vital initiative. We look forward to partnering with CBA as we continue to innovate and explore new ways to improve financial inclusion for all consumers.”

Through its seminal 2012 – 2014 Power of Rent Reporting pilot, CBA found that 100% of residents who started off with no credit score became scorable at the near-prime or prime level. Additionally, on average, residents with sub-prime scores saw those scores increase by 32 points.

Fueled by these findings, policy makers in California are promoting rent reporting as a viable and powerful economic mobility strategy and one that narrows the racial wealth gap. California Senate Bill 1157 passed in 2020 and will require affordable housing providers (of a certain size) to implement rent reporting for their tenants – ultimately benefitting potentially hundreds of thousands of Californians. The RRTAC initiative will actively reach out to these landlords who must now comply with this new law.

Rent reporting is a win-win:

  • Residents gain the opportunity to build credit without assuming additional debt through the establishment of a new tradeline on their traditional consumer credit report.
  • Resident Service Providers gain access to a credit building “product” around which they can wrap coaching and education to provide residents with a means to measurably improve their credit profile and ultimately other financial outcomes.
  • Property Managers gain a tool to offer a positive incentive for increasing on-time rent payments and a competitive advantage in recruiting new residents.
  • Tyler is a Fintech Junior Journalist with specific interests in Online Banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

Financial literacy platform Kikoff slam dunks with $42M in funding, Steph Curry backing

A personal finance platform backed by basketball star Steph Curry this week announced it has raised $30 million in fresh funding. The San Francisco-based Kikoff was founded in 2019 with the goal of helping consumers both establish credit history and continue to build credit. The company offers a $500 revolving line of credit to customers, many […]

In Profile: Sam Edge of Amazon Web Services

In this months edition of the In Profile series, The Fintech Times sits down with Sam Edge, EMEA, Head of FinTech Business Development at Amazon Web Services (AWS). Sam is responsible for leading the Fintech go to market strategy, building the ecosystem across EMEA, and fuelling innovation and connectivity across the sector. 

For over 15 years, Amazon Web Services has been the world’s most comprehensive and broadly adopted cloud platform. AWS has been continually expanding its services to support virtually any cloud workload, and it now has more than 200 fully featured services for computing, storage, databases, networking, analytics, machine learning and artificial intelligence (AI), Internet of Things (IoT), mobile, security, hybrid, virtual and augmented reality (VR and AR), media, and application development, deployment, and management. It recently announced the general availability of Amazon FinSpace, a purpose-built analytics service that reduces the time it takes FSI organisations to find, prepare, and analyse financial data from months to minutes.

 Sam Edge, EMEA, Head of FinTech Business Development, AWS Sam Edge, EMEA, Head of FinTech Business Development, AWS
Sam Edge, EMEA, Head of FinTech Business Development, AWS

What makes AWS and Fintech such a great combination?

Leveraging the benefits of AWS cloud has helped companies such as Wise (formerly TransferWise), OakNorth, Funding Circle and Monzo achieve their potential. This is due to a number of factors, including one-click regulation and compliance; seamless and safe transaction data backups; performance and scaling; high availability; support for a DevOps culture and state of the art artificial intelligence and machine learning services.

Fintech founders and executives searching for industry best practices can speak to AWS to learn about startup programs, compliance and security resources, and updated fintech case studies.  

Our customers are leveraging AWS’s services to build fully regulated digital banks, global payments operations, and securities trading applications. BlockFi, for example, built a company on AWS that offers wealth management products to cryptocurrency investors and their CEO, Zac Prince, shared that “the support we have received from AWS since day 1 including the Activate program, technical support, and specialised fintech resources has been nothing short of fantastic.”

Other customers, like fintech startup Behalf, have found value in our go-to-market programs, including the AWS Partner Network (APN). Their CEO, Rob Rosenblatt, said that “AWS has been a powerful partner in helping Behalf build robust and secure infrastructure to power our B2B financing platform. Having access to APN has been instrumental in navigating the current fintech landscape, and the AWS Fintech team has been an excellent strategic partner for our continued growth.”

Is there anything that initially drew AWS towards fintech?

Startups are important for a number of reasons. They fuel innovation and experimentation, test the limits of what’s possible, solve challenging problems, and address gaps in peoples’ daily lives.

AWS fintech expertise has been built through years of experience working with fintechs and financial services organisations, including Stripe, Betterment, Afterpay, and Wise. Since AWS was launched 15 years ago, our relationship with fintechs, neobanks, and the people who build them has been based on our ability to deliver the innovation they need at the speed they move. 

Have you developed any products specifically to manage fintech issues?

How AWS supports our financial services customers, and across every industry and segment, including startups and Fintechs doesn’t change – we obsess over our customers, we invent, we think long-term, and we make security and operational excellence our top priorities. AWS will continue to work with our financial services customers to innovate, transform, and tackle important challenges – 90% of what we build is driven by what customers tell us matters, and the other 10% are things we hear from customers and we try to read between the lines and invent on their behalf.

One example is Amazon FinSpace, which was announced in May 2021, to support our financial services customers. The service provides an easy-to-use web application that gives analysts at hedge funds, asset management firms, insurance companies, investment banks, and other financial services organisations access to the information they need and the ability to run powerful analytics on demand across all of their data.

FinSpace reduces the time you spend finding and preparing petabytes of financial data to be ready for analysis from months to minutes. Prior to the creation of Amazon FinSpace, our customers would spend a lot of time on manual, ad-hoc processes involving data analysis. Before data can be combined and analysed, analysts would spend weeks or months to find and access data across multiple departments, each specialised by criteria such as market or geography. In addition to this logical segregation, data is also physically isolated in different IT systems, file systems, or networks. Because access to data is strictly controlled by governance and policy, analysts must prepare and explain access requests to the compliance department.

Where do you see the space going?

After a year of pandemic-driven digital transformation in the financial services industry, the focus in 2021 and beyond is on accelerating innovation to drive new and better ways of operating, identifying business opportunities, and delivering more personalised customer experiences – with no looking back to pre-pandemic norms. 

Focusing on analytics and the advantages of cloud provides FinTechs and financial institutions alike with an opportunity to take advantage of the momentum from this unprecedented pace of change, to reinvent themselves, re-imagine business and customer value, streamline operations, and all while increasing resiliency and agility. 

How important are analytics for fintechs right now?

AWS customers of all sizes are laser-focused on the opportunity cloud-based analytics is creating by enabling deeper, more sophisticated insights, but the barrier to entry remains high for financial data. Finding, acquiring, and evaluating a seemingly endless array of data effectively requires analytics tools and resources that many organisations cannot afford or accommodate, or that were built to run on a single computer. Existing tools were not designed to take advantage of the cloud’s scale and connectivity to enable large scale analytics on-demand. Historically this has meant organisations missing opportunities to capitalise on data-led decisions. 

That’s why we launched Amazon FinSpace, which makes it easier to leverage advanced analytics capabilities, whether customers have large teams of data scientists or not. 

How will understanding analytics help fintechs accelerate in payments?

Today’s FSI organisations are generating and collecting hundreds of petabytes of data every day from internal data sources like portfolio management systems, order management systems, and execution management systems—as well as third-party data feeds like high-volume historical equities pricing data, employment figures, and earnings reports. These organisations want to use the petabytes of data they possess to gain insights that help identify new sources of revenue, attract and retain customers, and reduce cost or risk. 

However, before data can be analysed, FSI companies typically spend months finding the right data and getting it prepared for analysis. Discovering and preparing data is time-consuming and data access is tightly controlled by regulation and policy, meaning analysts must justify to compliance officers how their access will conform to data use policies before they can access the data. Increased adoption of tools like Amazon FinSpace will allow organisations to benefit from the elasticity, scale, and cost savings provided by cloud computing. Customers define their data access policies within Amazon FinSpace, and the policies are automatically enforced across data search, visualisation, and analysis. 

What do you think the short-term future holds for payment innovation?

We’ll continue to see data and analytics become a core element of financial institutions. Mandatory adoption of ISO20022, the global data standard for modern payments messaging between financial institutions and payment systems, will begin in November 2022. All banks providing payment services, both domestically and internationally, are upgrading their applications to take advantage of the improved data sets to perform better compliance checks and increase the straight-through processing rates for payments. The implementation of ISO20022 will bring more granularity and 7x bigger messages than existing payment message formats. At its core, the richer data enabled by ISO20022 will make payments faster and with lower repair or failure rates. 

However, the biggest benefit will be the opportunity to identify the business context of a payment transaction, enabling banks to offer value-added services to their customers. Organisations will also need to innovate and integrate purpose-built solutions at a faster pace, opening up their platforms via APIs. Financial services firms leading payment transformation around the world have embraced cloud as their platform for innovation, leveraging not only cloud native services to build real-time API-enabled platforms but also to integrate cloud-native fintech solutions.

  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

Multi-Factor Authentication Can Deter OTT Password Sharing

With streaming services competing for the limited time, attention, and money of consumers on entertainment platforms such as Netflix, Apple, Hulu, Spotify, Disney+, and Peacock, a new segment of potential customers—freeloaders—has emerged. ‘Freeloaders’ depend on the generosity of their friends, families, and significant others to share their streaming account passwords. Streamers will now have to find innovative cybersecurity methods, including two-factor authentication (2FA), to reduce password sharing without frustrating loyal customers. 

The number of people who enjoy streaming movies and TV shows for free is massive. A study suggests that a staggering four out of ten Americans admit to “mooching off someone else’s streaming account.” Today, 42% of Gen Z subscribers share their account credentials with someone outside of their household. 

Streamers are losing millions of dollars in revenue due to password sharing. According to one study, Netflix lost a whopping $135 million a month in 2019 due to account sharing. The company’s phenomenal growth over the past two years has certainly magnified this type of revenue loss. Although executives of various OTT platforms regularly downplay the effect of account sharing on the bottom line, most analysts agree that with the growing competition among the ever-rising number of streamers, policies to curb password sharing will inevitably follow. 

Streamers have experimented with various techniques to prevent account sharing during trials. However, they have stopped short in actually implementing them because of the backlash received from loyal customers. E.g., when Netflix, in a limited trial, merely sent a warning prompt urging customers suspected of password sharing to create their own accounts, the public outcry was fierce.

Streamers need to implement a solution that is familiar to customers and minimizes friction in customer experience for a rightful account owner. What could be more frustrating than sitting down to watch your favorite show after a long day only to be required to jump through multiple security checkpoints? One-time passwords (OTPs) and Instant Link™ are two solutions under the 2FA umbrella which could end password sharing. 

While OTPs are being phased out of high-risk transactions such as money transfers, they could be leveraged for low-risk use cases such as the one described above. Here’s how it could work: When a streaming service identifies a login on an unfamiliar IP address, it will send an OTP to the user’s registered cellphone. If the viewer were using their friend’s account, they would have to contact their friend and ask for the OTP, which is awkward and annoying. The OTP acts as a social deterrent, making account holders less likely to share their passwords moving forward. 

Instant Link, a more modern form of two-factor authentication, works like an OTP but is more secure and frictionless. In this scenario, account holders can click on the link texted to them rather than key in an OTP. Although Instant Link provides better security and is more convenient, it could entirely curtail password sharing.

Each streamer will have to find the sweet spot between creating friction for individuals using someone else’s password and ensuring ease of use for account holders. Streamers eager to restrain password sharing without frustrating customers can use both forms of two-factor authentication. With companies aggressively focusing on the lost revenue caused by ‘freeloaders,’ the use of OTPs and Instant Links is likely to proliferate. 

This article is a synopsis of a blog published by Prove.

Germany Thwarts Cyberattack, Denies Impact on Banking System

German authorities thwarted a cyberattack on a data service provider used by federal agencies and pushed back on a report that a broad assault targeted critical infrastructure and banks.

The attempt was quickly dealt with and impact on service was “very marginal,” Interior Ministry spokesman Steve Alter told reporters on Wednesday, adding that it was likely criminally motivated.

The Commerzbank AG headquarters, second left, and the Deutsche Bank AG twin towers, right, stand illuminated with other skyscrapers in the financial district in Frankfurt, Germany.

He was queried about a report by Bild newspaper, which cited unidentified intelligence sources saying that a hacker group linked to the Kremlin had carried out an attack on German infrastructure and the country’s banking system.

Bild identified the group as “Fancy Lazarus” after earlier referencing “Fancy Bear,” a group controlled by Russia’s GRU military intelligence agency that was behind the hacking of Hillary Clinton’s staff before the 2016 election, according to a 2018 U.S. Department of Justice indictment.

Authorities haven’t detected an increase in cyber activities in recent days, Alter said.

Germany’s BSI Federal Cyber Security Authority denied the report on Twitter and said that the agency had no knowledge of the attack, which Bild said may be revenge for international sanctions leveled on Russia and Belarus.

Das BSI dementiert Medienberichte zu vermeintlichen Cyber-Angriffen auf #KRITIS und Banken. Wir haben derartige Angriffe nicht bestätigt. Es liegen derzeit auch keine Hinweise auf derartige Angriffe vor. #infosec #CyberSecurity #DeutschlandDigitalSicherBSI

— BSI (@BSI_Bund) June 30, 2021

Proofpoint Inc., a cybersecurity firm, said this month in its blog that Fancy Lazarus previously identified themselves as Fancy Bear and has been involved in an increasing number of so-called distributed denial-of-service attacks, including against the energy, financial and insurance industries. Such attacks attempt to overload systems by flooding the target with superfluous requests from multiple sources.

Proofpoint said there was no known connection to the Fancy Bear group that has been labeled an advanced, persistent threat.

Spokespeople for Deutsche Bank AG and Commerzbank AG and for lobby groups for savings, cooperative and private lenders said they were looking into the report. Germany’s BaFin financial regulator and the European Central Bank didn’t immediately respond to requests for comment.

With elections looming in September and Chancellor Angela Merkel poised to step aside, German authorities are on the alert for the potential for interference from Russia, both in terms of cyberattacks on infrastructure as well as disinformation campaigns.

The Green party’s chancellor candidate, Annalena Baerbock, has become a target given her strong opposition to the almost-completed Nord Stream 2 pipeline that would channel gas from Russia to Germany.

Russia has repeatedly denied state involvement in hacking. President Vladimir Putin told reporters after his summit with U.S. President Joe Biden this month that the two sides had agreed to “start consultations” on cybersecurity, adding that the sides should “discard all conspiracy theories” about attacks.

After cyberattacks in the U.S. linked to Russia in December, Kremlin spokesman Dmitry Peskov rejected allegations of Russian involvement, saying “there’s no need to immediately blame the Russians for everything without basis.” Peskov didn’t immediately respond to a request to comment.

By Patrick Donahue and Jake Rudnitsky–Bloomberg Mercury

Is Niche Banking Here to Stay?

For several years now, there has been a rise in the number of digital banks taking on traditional banks, vying for a share of their client base. In the past couple of years, however, we’ve seen a slight twist in this trend.

These digital banks are taking personalization to the next level, and many have launched with the purpose of fulfilling the unique needs of niche subsets of the population that each share similar needs and struggles. Notably, these digital newcomers are generally not a solution looking for a problem; they are truly meeting unmet needs of previously ignored client bases.

Built for “x”

There are endless examples of these digital banks built for “x.” However, here are a few that Rilla Delorier, Director at Nymbus highlighted in her keynote at FinovateSpring:

  • Sable, banking services for immigrant employees and international students who may lack a social security number
  • Hitched, an app that helps newlyweds manage their funds together
  • Convoy, payment and money management services to meet the needs of long-haul truckers
  • Blueprint, banking services for contractors
  • Gig Money, money management tools to help gig workers smooth cash flow
  • Access, a banking platform that provides capital to black-owned businesses

This concept of niche banking isn’t new. Many community banks and credit unions launched to serve unique populations such as teachers and military families, but have since expanded their membership to serve the needs of a broad population. The continuous call for personalized products and services in the banking sector, however, combined with the lack of action from traditional banks, has inspired a new rank of fintech nerds to develop and launch not just clique-specific services, but clique-specific banks.

Sticking power

These newcomers have struck a nerve with users, especially those who were previously underserved. That’s because they not only make banking products accessible, they do so in a language that each unique consumer group understands. For example, the website may provide multiple language options or leverage visual/video tools to better communicate with customers from different backgrounds.

Furthermore, digital banks are providing products and services tailored to the unique needs of these groups. If the customer base notoriously struggles with making ends meet, for example, the bank might offer an early pay option that fronts their paycheck a week-or-so in advance. Or, in an example of a gig worker-specific bank, the bank may provide a tool that helps smooth out the user’s cashflow to ensure they don’t overspend on a month when their income is higher than average.

This segmentation goes beyond what traditional banks, who serve users based on geography, have previously offered. “If you think about defining community based on geography, where you live doesn’t really determine what your financial needs are,” Delorier explained in her keynote.

Given this hyper-personalization, expect that this new form of digital banking is here to stay. That said, traditional banks still have a the opportunity to stay in the game.

How it will work alongside traditional banks

What should the role of traditional banks be amid all of this? In short, the answer is that banks will be expected to collaborate with new digital banks and standalone technology providers. As Alyson Clarke, Principal Analyst and Forrester Research said in her presentation at FinovateSpring, “In the era of open finance, no bank will succeed alone.”

Banks need to become comfortable with collaboration, partnerships, and coopetition. Clarke recommends that banks build multiple routes to market, partner where they are weak, and specialize in what they are good at. “What we do know is that most banks will have a stark choice: own customers or power finance. But in the future, few will do both,” Clarke concluded.

What will traditional banks’ response be?

Both Delorier and Clarke recommend banks do one thing: rethink. That is to say, banks should rethink their digital transformation, rethink policies and procedures around credit decisioning and membership criteria, and rethink customers and markets.

What this looks like will vary among organizations, but banks can start by conducting research to discover unmet customer needs, incorporating diversity into their workforces in order to represent a wider range of customer segments, and leveraging technology partners.

“It’s not about following your established business models and delivering digital technology with agility. That’s not good enough anymore,” said Clarke. “You have to rethink customers and markets, rethink your consumers and what they need and invest ahead of that change to be more responsive.”

Photo by Kampus Production from Pexels

5 Credit Score Myths Busted by Aion Bank

Preparing to buy a house feels like a pretty daunting task and the thought of needing a ‘perfect’ credit history can sometimes feel impossible. 

Data from PWC suggests there may be up to 14 million people in the UK with ‘less than perfect’ credit, struggling to access credit from mainstream lenders, despite only having minor blemishes on their credit history.But what is ‘perfect credit’ and does it even exist?

Paul Elliott, Head of Mortgages at Atom bank, who have introduced Near Prime mortgages into their product range this week, busts 5 common myths around having the ‘perfect’ credit history, revealing what can and can’t affect it and what happens if your application gets rejected.

Your credit history is a record of how you’ve managed your money in the past – including past borrowing, repayments and any missed payments – this is quantified by a score or ranking. The general consensus is that the higher your credit score, the better your chances of being offered a loan. However, as Paul explains, there are many myths and misconceptions that may put some consumers off from applying for a mortgage if they don’t think their credit history is quite perfect, something Atom is hoping to challenge through making mortgages accessible to more people.

Paul Elliott, Head of Mortgages at Atom bank, said: “We’re constantly told that our credit score is the most important part of securing a mortgage so it feels like a daunting concept. As humans we fear the unknown and the lack of education around finances and credit for younger people means that we grow up not really understanding the role that credit plays in securing a mortgage, yet fearing it anyway.

“The main way we can combat that fear factor is through proper education on what it all means. In the UK, there isn’t actually one overarching number attached to you that dictates to lenders whether they should take you on as a customer. Instead, you have a ‘credit report’ which encompasses your credit history. Simply understanding that there isn’t one golden number and what’s contained in your credit report makes the process of building a strong credit history seem much more achievable.”

If I keep checking my credit score, will it go down?

Many of us have heard the theory that any checking of your credit score has a negative impact on your rating, but is that really true?

Paul comments: “This is not the case, the number of times you’ve checked your own credit score isn’t shared with lenders but making credit applications means that lenders will check your credit history and this can result in your credit score being impacted. In fact, it’s a good idea to keep an eye on your credit score regularly to be sure that all data recorded is accurate. Report any incorrect information straight away.”

Should I get a credit card from a young age?

Most of us have been told at one point or another that having a credit card from a young age is the holy grail of building up your credit history, but if you’re not careful it can actually have the opposite effect.

Paul advises:  “Ultimately, this depends on the person, their spending habits and their relationship with money. Getting a credit card and paying off amounts regularly can boost your credit score by proving your payment history but if you are unable to make a payment, it can have adverse effects and actually have a negative impact – so think carefully before taking out a credit card.”

Does my credit score have to be high to get a mortgage?

There’s not actually any ‘golden number’ that means you will or won’t get a mortgage.

Paul explains: “There’s no exact minimum credit score for a mortgage – each lender has different requirements that have to be met for you to qualify for a loan. They will look at your whole credit history and may still offer you a mortgage if it’s not perfect, although you may have to pay higher interest rates. A low credit score means that you may be able to borrow from fewer lenders compared to someone with a higher score, and it may be more expensive when you do.

If I’ve missed any monthly payments, will I be disqualified from getting a mortgage offer?

Although missed monthly payments should be avoided, they don’t have to be the end of the world.

Paul elaborates: “Late or missed payments can stay on someone’s credit report for up to 7 years and most mainstream banks will decline loan applications if they have missed multiple payments.

“If you have missed payments, then a Near Prime mortgage may be the option for you. Our Near Prime offering at Atom accepts applicants even if they’ve had a few financial indiscretions (visit our website for the full list of criteria ) – we acknowledge that these things can happen and not everyone will have the perfect credit history, so the new mortgage offering is launching to support more people.”

If I get rejected for a mortgage application, will I never get one? 

This is a scary thought, but luckily it’s not true!

Paul explains: “In the majority of high-street banks, mortgage applications are rejected when customers have less than perfect credit. Although this can feel daunting, it doesn’t mean you won’t be able to secure a mortgage another way, whether that’s through waiting and building up your credit history, or through opting for a different type of mortgage.

“In the current housing market, it’s important to offer more people in the UK the opportunity to become homeowners and extend the availability of credit within the UK lending market, which options like Near Prime mortgages allow.”

  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

Splitit Partners With Middle East BNPL Tabby to Offer Installments Paid Via Credit Card

Splitit, the company empowering consumers to use their existing credit to spread payments over time, announced a partnership with tabby, the leading Middle East Buy Now Pay Later (BNPL) provider. tabby will integrate Splitit’s instalment payment platform through a white-label solution to allow tabby’s merchants to offer instalments on credit cards. The integration of Splitit will also allow tabby to expand its offering to new merchant categories and those with higher average order values.

tabby will integrate Splitit’s technology into the tabby BNPL platform to seamlessly provide shoppers with an additional option to pay in instalments over time using their credit card. The integration to tabby’s BNPL platform is expected to be completed by the end of Q3 2021.

tabby is the leading BNPL provider serving the United Arab Emirates (UAE) and Saudi Arabia, supporting more than 2,000 merchants, including Ikea, SHEIN, Marks and Spencer, adidas and Toys R Us. In 2020, the e-commerce market was valued at $11 billion in Saudi Arabia and $7 billion in the UAE and is expected to double in size in the next five years. tabby offers a consumer financing option for shoppers to pay for items in four equal instalments and has a high-profile brand in the region. tabby integrates directly into merchant checkouts or POS systems and does not charge shoppers interest.

“This is a great partnership for us at tabby as it allows us to broaden our product offering to existing merchants as well as enter new verticals across the markets we serve,” said tabby founder and CEO Hosam Arab. “Splitit has an elegant solution that will fit nicely within our product and complement our financing options for higher-value purchases.”

“We are delighted to be partnering with tabby to expand their market-leading offering. We’ve always seen our solution as complementary to other BNPL providers, which this new exciting partnership with tabby highlights perfectly. Our global payments platform is the only solution leveraging credit card payment networks, with the flexibility to scale internationally without the need for major on-the-ground support,” said Splitit CEO Brad Paterson.

“Having expanded our platform capability, we can now also offer white-label solutions as a way to enter new regions such as the Middle East by partnering with established players that already have a strong market presence. While we remain focused on further penetration of Splitit’s branded product in the US, APAC and Europe, this provides a new low-cost, high-margin revenue stream which we can easily emulate in other markets.”

  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

Partnership Between Scienaptic and 700Credit To Combine AI With Credit Data for Automotive Industry

It is reported that the AI-powered credit decision platform provider Scienaptic is to partner with 700Credit, the credit data provider for the automotive industry. This alliance will enable Scienaptic to utilise 700Credit’s credit and compliance reports to enhance decisioning for its auto lending clients.

700Credit is one of the most prominent providers of credit reports, compliance, and soft pull products to Automotive, RV, Powersports, and Marine dealerships within the U.S.

700Credit’s offerings include credit reports, pre-screen and pre-qualification platforms, OFAC compliance, Red Flag solutions, MLA, synthetic fraud detection, identity verification, score disclosure notices, and adverse action notices.

“Using rich data, auto lenders are empowered to make more informed decisions while safely extending credit to new applicants,” comments Ken Hill, Managing Director of 700Credit. “Scienaptic’s AI-driven credit underwriting platform, paired with our data, will allow auto lenders to approve more customers with confidence, mitigate risk, and deliver faster credit decisions. We are pleased to partner with Scienaptic to help auto lenders make better loan decisions for their customers.”

Pankaj Jain, President, ScienapticPankaj Jain, President, Scienaptic
Pankaj Jain, President, Scienaptic

“Integration of AI with rich data is radically changing credit underwriting,” adds Pankaj Jain, President of Scienaptic. “Through this partnership, Scienaptic and 700Credit will combine resources and expertise to focus on delivering a ‘best-in-class’ credit decisioning solution for auto lenders.”

  • Tyler is a Fintech Junior Journalist with specific interests in Online Banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.

Stablecoin News for the week ending Wednesday 30th June.

The Empire is so preoccupied it can’t strike back! 

Here is our pick of the 3 most important Stablecoin news stories during the week.

Last week we saw a flurry of activity from the Financial Industry Establishment as it struck back at the upstart Crypto and Stablecoin communities.  This week we see a group of stories that makes you wonder if they are even capable of stopping or taming this new industry.

Firstly, the BIS consultation on what level of leverage a Bank should be able to have for Crypto Assets.  Last week we noted how the BIS was proposing such a high level and at a cost that in effect meant no Bank could afford to trade Crypto in a proprietary sense.  But maybe, traditional banks are simply not set up operationally or technologically to hold on-balance sheet assets, such as bitcoin, that settle in minutes with irreversibility.

Proposed Bitcoin Capital Requirement For Banks: Too Low And Would Leave Banks Vulnerable (

In the meantime, the supply of stablecoins on crypto exchanges has surged to a historic peak, meaning plenty of funds sitting on the sidelines waiting to purchase Crypto on the dip, according to an analytics expert.  

Stablecoin Supply on Exchanges Hits ATH of $17 Billion, Here’s What It Means for BTC

Also, this week the Monetary Authority of Singapore (MAS) has teamed up with the International Monetary Fund (IMF), World Bank and others to launch a competition where entrants must tackle 12 unresolved challenges posed by central bank digital currencies (CBDCs).  These issues or unresolved challenges are significant to resolve and show that CBDC’s are still very much in the concept stage.   

Singapore’s Central Bank, IMF Launch Global Challenge for CBDC Solutions – CoinDesk

Then we had this alarming report, that with all the money printing by Central Banks, we are now at the beginning of the first bursting of a global sovereign debt bubble in 100 years and the first currency system shift in 50 years.

The First Currency System Shift In 50 Years – Bitcoin Magazine: Bitcoin News, Articles, Charts, and Guides

So in summary, does the existing Financial Industry have enough on it’s plate without also having to reinvent itself at the same time?


Alan Scott is an expert in the FX market and has been working in the domain of stablecoins for many years.  

We have a self imposed constraint of 3 news stories per week because we serve busy senior Fintech leaders who just want succinct and important information.

For context on stablecoins please read this introductory interview with Alan “How stablecoins will change our world” and read articles tagged stablecoin in our archives. 


New readers can read 3 free articles.  To  become a member with full access to all that Daily Fintech offers,  the cost is just US$143 a year (= $0.39 per day or $2.75 per week). For less than one cup of coffee you get a week full of caffeine for the mind.

UK Fintech News Round-up: The Latest Stories 30/06

Each week The Fintech Times takes a lot at some of the top stories in UK fintech. In this weeks round-up, UK Leads Europe with £46M Card Fraud Loss Cut in 2020, London is the third-best global tech hotspot and Half of UK parents struggle to talk to their children about money

Consumer spending falls by 16% since the latest lifting of restrictions

Reduce virus spread by paying contactless using mobile app during coronavirus lockdown

Reduce virus spread by paying contactless using mobile app during coronavirus lockdown

User data from Yolt, the smart money app, reveals consumers have spent on average 16% less since lockdown restrictions lifted on the 12th of April, as economic uncertainty continues, and people remain cautious about their spending as they come out of lockdown. However, people spent 9% more on eating out in the last two weeks of May, following the easing of restrictions on the 17th, when compared to the same period in March.

Pauline van Brakel, Chief Product Officer at Yolt said: “The past year of lockdown restrictions has undoubtedly had an impact on our food shopping, dining, and savings habits, and with each change we are likely to see more shifts. Our data suggests that consumers are looking to spend smarter and reduce their outgoings in light of broader economic uncertainty. Even as lockdown eases, we anticipate people will want to continue to spend cautiously whilst making the most of their new freedoms.”

Half of UK parents struggle to talk to their children about money

A new report by Blacktower Financial Management Group found that 51% of UK parents struggle to talk to their children about money matters, with 6-in-10 parents (63%) not regularly discussing finances as a family. 59% of parents believe their children should grow up blissfully unaware of how and why it is important to start saving. This is a pleasant theory, but a lack of understanding around basic finances can leave children falling behind as they grow up and struggle to manage savings and outgoings.

John Westwood, Group Managing Director at Blacktower Financial Management comments on the study “It’s eye-opening to see the large percentage of UK parents struggling to talk to their children about money even though parents know they are the biggest influencer over the development of their child’s money management skills. We hope that our useful tips will help you to start educating your child about money and have a positive impact on your child’s financial future.”

Over a third of SMEs in the UK say the pandemic has super-charged their business

Visa’s mission to digitally enable small businesses

Visa’s mission to digitally enable small businessesOver a third (35%) of UK small and medium-sized enterprises (SMEs) believe the pandemic has been a positive catalyst for change as digital skills soared during lockdown, according to the findings of PayPal’s inaugural report, The Business of Change: Recovery and Rebuild.

The poll of 1,000 SMEs reveals 30 per cent believe their business plans have been expedited by a year or more due to COVID-19, with one in eight (11%) stating they are now at three or more years ahead of where they expected to be, despite recent lockdowns.

“Small firms must apply the hard-learned lessons from the pandemic, building on their new digital capabilities and retaining the focus and effectiveness demanded by these tough conditions. These lessons will make them stronger, more resilient to future shocks, and more likely to be in a position to grow and thrive in 2021 and beyond,” said Michelle Ovens CBE, Founder of Small Business Britain.

Cashflows research reveals the impact of the pandemic on ethical shopping behaviours

Shoppers' Survey

Shoppers' SurveyCashflows have published new research revealing the impact of the pandemic on UK consumer shopping habits. The research shows a marked increase in those who say they feel motivated to buy based on ethics, however cost, quality and convenience remain the primary concerns.

More than nine in ten (91%) UK consumers say they actively seek out products with ethical affiliations and 35% are more motivated to do so now than they were before the pandemic. This rises to 45% for the key retail demographic of 18-35 year olds, and 47% for consumers within Greater London. Respondents over 56 are most likely to opt for local produce (43%) and British manufactured products (42%), whereas 18-35 year olds seek cruelty-free products (32%) and products with recycled packaging / that do not use plastic (30%).

UK Leads Europe with £46m Card Fraud Loss Cut in 2020

eCommerce Fraud

eCommerce FraudUK financial institutions continued to lead the charge across Europe in thwarting the criminals. New data from FICO’s updated European Fraud Map shows that the UK achieved the greatest fall in card fraud monetary losses, dropping 7 per cent and £46 million year-on-year.

However, other nations among the 18 European countries studied did not fare as well. Overall, card fraud losses in these countries were reduced by €62million.

Fraudsters are constantly scanning for access to poorly protected accounts and opportunities to manipulate transactions and this is what made 2020 such a challenge,” said Matt Cox, vice president for financial services in EMEA at FICO. “Fraud teams would have faced wave after wave of sophisticated COVID and Brexit scams, which makes the success of UK financial institutions – protecting Brits’ finances – even more impressive.”

London is the third-best global tech hotspot

Over the past year, it’s become clear how powerful electronic technology can be – from helping us stay connected across distances, to disseminating crucial news and data in real-time. With the entire world relying on tech devices, particularly recently, the tech race has never been this competitive. Electronics retailer Carphone Warehouse created the World‘s Tech Hotspots index to find out which cities around the world are on the winning stretch. 

It’s probably no surprise that the leader in the World’s Tech Hotspots is San Francisco, home of Silicon Valley, however, London sits in third position. London scores well across several metrics, including the joint-highest smartphone penetration percentage of all cities assessed (82.9%, alongside Manchester), great start-up scores, and top scores for education.

UK’s fintech industry is much less London-centric

Despite the above and that London is still one of the strongest cities in the world for fintech, many cities outside of London are developing into thriving fintech hubs. Birmingham entered the rankings at 123, Cardiff came close after at 127. Although London is by far the largest fintech hub in the UK, the growth of what the report identifies as ‘tertiary hubs’ is promising.

Although growth in large English cities like Manchester and Birmingham is to be expected, as is the presence of fintechs in cities near London like Cambridge and Brighton, the report showed surprising growth in other British cities like Cardiff (ranked 127th) and Newcastle upon Tyne (ranked 155th), both of which were new entries this year.

Findexable’s founder and CEO Simon Hardie explains: “The UK continues to be a major player in fintech, but unlike the larger finance sector it is moving away from being largely London-based. We are seeing how investment in creating technology hubs in secondary cities is translating into the creation of thriving communities and viable companies.”

TfL has abandoned plans to make the London Underground go cash-free

Transport for London has announced they have abandoned its plans to make the London Underground go cash-free. A total of 200 of the 262 Tube stations stopped taking cash in May 2020 amid concerns that the sharing of notes and coins could spread Covid, and to prevent queues at ticket machines to aid social distancing.

However, City Hall has announced that the “vast majority” of Underground and DLR stations would now have one machine able to accept cash payments to buy tickets or upload credit onto Oyster cards.

Dean Wallace, Practice Lead, Real-Time & Digital Payments at ACI Worldwide said: “Cash is no longer king, despite Transport for London (TfL) doing a u-turn on its plans to go cashless.

“It’s clear that we’re moving further and further into a cashless society. That said, the move by TfL highlights the scepticism associated with this shift brought on by fears of the unknown. But this move to cashless should be embraced, not feared! Digital payments actually lead to fairer access to cash and payments, stimulating the economy itself.

“While TfL’s move seems to go against the turning tide of a cashless economy, commuters will continue using digital payment methods on the tube, just as we will see the continued adoption of faster digital payment methods in all other walks of life.”

  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

Ivalua Finds Nearly Two-Thirds of European Suppliers Say Late Payments Put Them at Financial Risk

Research from Ivalua, a global spend management cloud provider, has revealed almost two thirds (65%) of suppliers feel late payments are putting their company at financial risk. As COVID-19 has heightened financial pressures, 60% of suppliers say they have been asked by customers to extend their payment terms in the last 12 months, yet almost a third (30%) say late payments had increased.

The research, conducted by Coleman Parkes, surveyed 300 suppliers across the UK, France, Germany and Switzerland, to examine supplier relationships with their buyers. The findings show late payments are having a knock-on effect across the supply chain. As a result, suppliers say they have had to extend or open lines of credit otherwise not needed (41%), delay delivery of products or services (34%), and increase prices or reduce discounts (33%).

In the UK, the government has toughened up its Prompt Payments code as part of a crackdown on delayed invoice payments. But more than a quarter (26%) of UK suppliers believe this won’t improve delinquency rates.

“Even in tough times, organisations must build strong supplier relationships so they can tap into supplier innovation and minimise risk of supply disruptions. Improving visibility and timeliness of payments is the single most impactful way to help organisations become a supplier of choice,” commented Alex Saric, smart procurement expert at Ivalua. “Organisations must modernise procurement tools to enable on-time payments and give suppliers the visibility needed, thereby bolstering relationships.”

Despite the opportunities presented by strong supplier relations, the research found 89% of suppliers feel pressured to reduce costs beyond what is reasonable. This is impacting collaboration, as almost six in ten (59%) suppliers say price pressure impacts willingness to share innovations.

According to the report, two-thirds (67%) of suppliers find buyer procurement systems a challenge to use, further limiting their ability to collaborate with organisations. The biggest barriers were access costs (40%), difficult to use systems (38%), and difficulty sharing information (34%).

“To drive efficient and scalable collaboration, organisations must take a smart approach to procurement that removes barriers to cooperation, improving visibility and giving suppliers the tools they need to share insights easily,” concludes Saric. “Only then will organisations be able to work with suppliers to innovate, reduce supply chain risk, and restore financial growth – ultimately gaining the advantage over competitors.”

  • Polly is a journalist, content creator and general opinion holder from North Wales. She has written for a number of publications, usually hovering around the topics of fintech, tech, lifestyle and body positivity.

SafetyPay: QR Codes and Cross Border Transactions Are Top Priority for Payments in Latin America

With a growing understanding and new consumer behavior embracing more and more digital banking, many are still learning about the capabilities of borderless and contactless payments after new perceptions of value, security, and availability, creating an ongoing challenge for merchants.

Gustavo Ruiz, CEO, SafetyPayGustavo Ruiz, CEO, SafetyPay
Gustavo Ruiz, CEO, SafetyPay

Consumers are seeking out simplicity and instantaneous opportunities more than ever before in this growing digital age and look to familiar opportunities like cross-border transactions and tools like QR codes that provide better solutions to everyday payments.   

But how impactful are QR codes to digital payments? How has the continuous e-commerce surge impacted Latin America and other marketplaces? Which regions are impacted the most by QR codes? What options do QR codes provide digital payment consumers? These are all questions approached by Gustavo Ruiz, the CEO of SafetyPay, an e-payments provider operating in over 17 countries worldwide. In this guest post for The Fintech Times, Gustavo addresses the future of what consumers should expect moving forward. 

QR Codes in Today’s Digital Banking

The implementation of Q-code services as payment methods in global markets brings instant payments to life. This solution allows non-credit cardholders and fraud-wary consumers to use QR codes without sharing additional information online and pay for goods and services. Capabilities like this expand the opportunity to complete instant payments at any date or time to pay for goods and services to millions of people.

With consumer preferences continuing to shift toward touch-free interactions, it is critical that businesses can connect physical and digital commerce. By providing consumers opportunities to pay digitally via a QR code and popular digital wallets, businesses are more convenient and offer more choices for all modes of commerce, especially as in-person shopping, dining, and entertainment experiences resume

A large part of the acceleration comes from merchants – who had previously dictated payments terms – turning to new, digital alternatives for their clients. For example, merchants that introduce QR codes for seamless checkout experiences are attempting to improve the customer experience, increase average order value (AOV), while also creating some money-saving automation for the merchant. 

Both small merchants and large banks are getting into the QR race for different consumer markets. Recently, Peruvian Central Bank allowed nine digital payment provider companies to operate with QR Code payments in the country. These agreements, transactions, and breakthrough decisions in digital banking have transformed the traditional methods of payments in uncharacteristic regions like Peru that is still a traditional cash-dependent society.

According to a recent Mastercard survey, 66% of respondents in Latin America and the Caribbean and 63% in the Middle East and Africa expect to use payment technologies such as QR codes in the next year. The adoption of new payment technologies such as QR codes, cryptocurrencies, and biometrics is on the rise. 

Looking toward a post-pandemic society, digital currencies, biometrics, contactless, and QR codes are becoming more mainstream as consumer’s comfortability with them and understanding of them increases and the use of cash decreases. Trends like QR codes are introducing a gradual shift toward a digital economy and a shift that may eventually lead us toward a global cashless society.

With the pandemic still garnering much of the attention in 2021 and impacting how people shop, contactless shopping is more relevant and popular than ever. Digital merchants offering cashless options make purchasing more convenient and safer for all. As the pandemic continues to impact small businesses all over the world, QR technology is playing a crucial role when it comes to adapting and moving forward into a new generation.

Pandemic-led Changes To Cross Border Transactions in Latin America and Global Markets

New forms of digital payments and consumer behavior have grown rapidly across Latin America and the Caribbean in recent years, influenced by a pandemic-led acceleration. That includes digital wallets and cross-border payments. For 2021, that adoption is poised for further growth. 

Cross-border transactions have simplified the digital purchasing options consumer have. These options continuously evolve as e-commerce continues to surge within U.S., U.K, Latin American, and many other European marketplaces. E-commerce has steadily competed for market shares from brick-and-mortar over the past two decades, but growth spiked since the beginning of the pandemic. 

Cross-border e-commerce sales grew 21% in 2020 compared to 2019, while payments processor Worldpay found that last year 55% of online shoppers made a cross-border purchase. From luxury goods to everyday necessities, consumers are buying online more and from abroad. For both merchants and payment processors, this has increased the need for seamless, reliable systems to support cross-border payments.

According to Statista, Brazil alone was forecast to account for almost one-third (32.5%) of the e-commerce market in Latin America and the Caribbean in 2020. It was followed by Mexico and Argentina with approximately 28.8% and 8.5%, respectively. According to projections, various economies in the region are expected to increase their participation in the market in 2021, with Argentina and Mexico experiencing the most notable growth in online sales.

Digital transaction platforms and new payment methods have continued to grow in Latin America since the turn of the century, but during Covid-19, these avenues have been pushed even harder. Enabling bank transfers for cross-border transactions are a must for merchants in order to compete with new markets.  A detailed personal banking strategy that recognises cross-border payments needs to be included when developing for a future post-pandemic. Countries are pulling ideas from other countries to establish rapport and build new target audiences to help improve their business strategy – which starts with the implementation of digital wallets and alternative payment options like cross-border transactions in their markets. 

Options for Consumers

QR codes and cross-border transactions have been around for decades, but the pandemic showcased a shift to a remote lifestyle with more global transactions that need technology to keep society progressing. Businesses can now connect with pre-existing and new customers while maintaining Covid-19 friendly protocols with the help of payment merchants. These digital options have accelerated cashless and paperless opportunities, allowing for flexibility, security and growth when Latin America and the world needed them most.

According to Harvard Business Review, cash only accounted for 30% of transactions as early as 2017. Statista reported that US-based businesses processed more than $170 billion in cashless transactions in 2018 alone. Consumers are becoming more comfortable with innovative payment technology as years progress and the standard credit card continues to be the preferred method of payment over cash in the U.S. 

In our world of digital banking, QR and cross-border opportunities commonly allow customers to make payments to multiple banks in multiple regions, a great technological advantage that allows simplistic and instant payments. 

More banking and payments brands are actively pushing and advocating contactless payments and many new merchants are joining the party. Incorporating contactless payments options like QR codes and cross-border transactions encourages the adoption of new technology among millions of users, especially for merchant partners with retailers and other B2C companies that may bring more customers on board.

As businesses continue to return to in-person operations in Latin America and around the world, consumers and merchants will continue to rely on payment technology for added convenience, reassurance, and reliable banking options for better purchasing power. It is not likely to be disregarded when social distancing eases and may even provide more ways to elevate the consumer experience in the future.

CommUnique: ESG Initiatives in European Neobanks including Monzo, Starling and Revolut

The recovery from COVID-19 will take time. The new reality will likely have fresh paradigms for our society, the economy, the way we conduct business and even how we address matters related to Environment, Social and Governance (ESG). 

One of the people who decided to tackle this matter and help organisations prepare for their post COVID-19 recovery is Gihan A.M.Hyde. Founder and CEO of CommUnique, a communication start-up specialising in Environmental, Social Impact and Corporate Governance (ESG) Communication. 

In an effort to highlight the importance of  ESG communication Gihan and her team conducted research where they looked at some of the most prominent Neobanks in Europe and analysed their ESG communication initiatives and strategies through online channels. The initiatives were analysed in terms of their duration, communication tone, audience interaction, and effective impact. The research looked at campaigns that took place in 2020-2021. 

The neobanks studied include Monzo, Revolut & Starling Bank from the United Kingdom, Lunar from Denmark, N26 from Germany, Neon from Switzerland, and Bunq from the Netherlands. All these companies are startups in scale-up or growth phase backed by credible investors and having dedicated user bases.

Some of the findings included: 

  1. 57% of the total campaigns were focused on “Social impact” whereas the remaining 43% were focused on “Environment”. This does not come as a surprise seeing that social impact campaigns are easier to launch and plan than environmental campaigns due to the technicality and complexity when it comes to measuring green and monetary success. 
  2. None of the banks told a holistic story around their sustainability and their social impact efforts. None of the campaigns analysed were related to the banks’ strategic objectives, narrative, or purpose. 
  3. All banks reported that their campaigns and initiatives were successful but lagged in telling their audience the full story and the role they played in making these campaigns a success. This is particularly evident with the “Environmental” campaigns. For example, Project Blue, is an initiative by Lunar with the help of The SeaBin Project, an Australian NGO. In the first 50 hours of launch more than 1,500 users signed up to join Project Blue. Lunar stated that the oceans were cleaned from 60 kg of plastic and more than 250 million litres of seawater. What was not clear is what did Lunar do with the plastic and where exactly did they clean the water?  
  4. The “Social Impact” campaigns focused on a philanthropic tone (Revolut), quirky, enthusiastic, socially conscious (Lunar), Brave, Bold, Advocative (Monzo) while the “Environmental” campaigns used a tone of voice that was authentic, informative (Bunq), positive, friendly, and encouraging (Neon). 
  5. Engagement level differed from one bank to another and from one campaign to another. The highest engagement from the audience came from Monzo’s Open Access to Gambling block campaign. The bank has the highest number of followers on Twitter (126.5k) and the highest average likes from Instagram with almost 1,700 likes (2.91% of followers) and 54 comments. While the lowest was from Bunq’s -Metal Card & Easy Green Plan – Instagram is the social media platform where the bank gets the maximum interaction for the posts from the followers compared to the number of people following which is 260 likes out of 23,000 (1.13%). 

The above results highlight the importance of communicating ESG as a holistic and transparent story. As it stands these banks risk being accused of “Green Washing” if they are not careful and if they do not continue to update their customers, employees, and investors on their progress. This is where your communication team will be your sense checkers and to do so they need to level up their skillset to fully understand the basics of ESG and its impact on business growth, employee engagement and customer satisfaction.

Investment App Stash Grabs Financial Literacy Platform PayGrade

Along with the fanfare surrounding so-called meme stocks and the “power of the individual trader” last year, there was a dark side. Investing and trading platforms that had embraced gamification were being accused of not fully preparing their customers for the dangers involved in stock trading – especially in volatile, illiquid stocks. Critics demanded that these platforms spend more time – and money, if necessary – educating their customers for their own benefit as well as for the good of the investing and trading industry, which has recovered impressively since the bust 20 years ago.

This is the spirit in which we take the news that Stash, a New York-based, mobile-first investment platform that made its Finovate debut in 2017, has acquired financial literacy platform PayGrade. The terms of the deal were not disclosed, but the acquisition marks Stash’s first acquisition and its biggest fintech news headline since a whopping $125 million Series G fundraising back in February.

Brandon Kreig, CEO and co-founder of Stash said that the acquisition was an example of the company’s mission to “empower everyday Americans to invest for the future.” He noted that personal finance education is not emphasized in American schools – with 43 out of 50 states not requiring coursework in personal financial management – and that an overwhelming number of American adults – as much as 80% – live “paycheck to paycheck.”

“With PayGrade,” Kreig explained, “Stash will provide teachers, parents, and children with interactive tools to learn effective money management skills that will last a lifetime.”

Stash enables users to begin investing on its platform with as little as $1 a month. The company’s “Stash Beginner” program allows investing – including fractional share investing – as well as banking, portfolio recommendations, savings strategies, and a Stock-Back card that helps users earn stock every time they use the card for shopping. Stash also offers Growth and Plus plans that add features such as portfolios for children, premium research, and enhanced bonuses for using the Stash Stock-Back card.

Purchasing PayGrade is not the only way that Stash will support the cause of financial literacy this year. Stash’s acquisition news arrived just a few days before the company announced that it was partnering with the Suh Family Foundation and the Big Yard Foundation to launch a financial literacy program over the summer. Dubbed the Stash101 Summer School, the program will be conducted in partnership with Portland Public Schools and will give 160 middle school students an introduction to vital money management and wealth building.

“From investing and banking to education and retirement planning, we believe everyone has the power to achieve greater financial freedom—one step at a time.” Krieg said. “We’re thrilled to deepen our commitment to childhood education through Stash101 and this special summer school program in Portland with the Suhs and Big Yard. It’s going to be a tremendous four weeks for the kids.”

Stash101 is part of the Portland Interscholastic League Trajectory Math Program, which provides additional learning resources for historically underserved students. The course will include a simulated economy experience in which the students will complete tasks like renting desks, while earning a salary and learning about the difference between savings and credit. The classes will be held between July 6 and July 27 at a pair of schools in the Portland School system.

Photo by Anna Nekrashevich from Pexels

Raisin Teams Up with Texas Bank to Launch its Savings-as-a-Service Solution in the U.S.

Technology supergeniuses and uber-popular podcasters aren’t the only ones choosing to set up shop in the Lone Star State these days. German savings marketplace Raisin has gone live with its first U.S. partner bank – Dallas, Texas-based MapleMark Bank – launching its term deposit products o MapleMark’s digital platform.

“Together with MapleMark Bank, Raisin U.S. is pursuing Raisin’s core mission of breaking down barriers to better savings and investments,” Raisin CEO Tamaz Georgadze said. “The U.S. deposit market hasn’t seen an innovation in decades. As a pioneer in the deposits space across Europe, it made sense for us to enter the American market by modernizing one of the most important and popular U.S. deposit product categories.”

Raisin made its choice of MapleMark known back in April. The integration of Raisin’s savings-as-a-service technology will enable MapleMark to engage new customers beyond its current private banking base. Raisin’s solution will allow MapleMark’s affluent clients to access personalized certificate-of-deposit products easily without having to open multiple, potentially unrelated banking accounts just to meet their cash savings goals. MapleMark Chief Financial Officer Willy Wolfe said that the partnership was a “win-win” for both the bank and its customers, and changed what historically had been a long, complex, and expensive undertaking into a process that is “instantaneous and simple.”

“Being able to generate cost-effective individualized deposit products at the click of a button advances MapleMark’s digital positioning in a highly competitive field, while also simplifying funding for the bank,” Wolfe explained.

Raisin’s solution enables financial institutions and their clients to personalize term deposits, including a schedule of projected outflows. Banks and customers can also choose to customize market-linked products to add exposure to potential upside from the market while still benefitting from the protection of a time deposit. Raisin’s pre-built term solutions for ladder, liquidity, and market-linked products are available to customers, as well.

Founded in 2012 and launched from its Berlin, Germany headquarters a year later, Raisin has place $32 billion for 335,000 customers in more than 30 European countries and more than 100 partner banks. Named one of Europe’s top five fintechs for 2019 and 2020, Raisin has raised $206 million in funding from investors including PayPal Ventures and Thrive Capital.

Photo by Elle Hughes from Pexels

Chinese Insurer Moves Into Dubai International Financial Centre With First Regional Office

As a global financial centre and top innovation hub in the Middle East, Africa, and South Asia (MEASA) region, the Dubai International Financial Centre (DIFC) has announced how the China Export and Credit Insurance Corporation, SINOSURE, has selected DIFC as the location for its first office in the Middle East.

DIFC is the preferred financial centre in the region for Chinese firms and home to the major financial institutions from that country. SINOSURE’s choice reflects the DIFC’s position as a global financial hub, with a world-class legal and regulatory framework, infrastructure, connectivity, and access to the world’s leading businesses.

With its new regional headquarters, SINOSURE aims to further support China’s national Belt and Road initiative, as well as promoting the development of the country’s foreign trade and investment.

SINOSURE is a state-funded and policy-oriented insurance company established to promote China’s foreign economic, trade development, and cooperation on a non-profit basis. SINOSURE had accumulatively supported more than $5.3 trillion of domestic and foreign trade and investment, provided credit insurance-related services for over 210,000 enterprises, and facilitated nearly 300 banks offering more than RMB 3.9 trillion of financing for exporters, as of the end of 2020.

Since 2015, SINOSURE has maintained a top ranking amongst Export Credit Agencies based on the total insured amount, according to the Berne Union (the global association for export credit and investment insurers).

Within its remit, SINOSURE as a Group writes short, medium, and long-term export credit insurance, foreign investment insurance, domestic trade credit insurance, bonds, guarantees, and reinsurance related to export credit insurance, accounts receivable management, and information consulting services among others.

Arif Amiri, CEO, DIFC AuthorityArif Amiri, CEO, DIFC Authority
Arif Amiri, CEO, DIFC Authority

In this regard, as the CEO of DIFC AuthorityArif Amiri comments, “We extend our congratulations to SINOSURE for successfully completing 20 years and for choosing DIFC for its first office in the region, which is a testament to Dubai’s position as the leading hub for business and trade in the Middle East, Africa, and South Asia. DIFC has a well-established reputation as an ideal base for leading Chinese companies and SINOSURE strengthens this. Their collective presence is underpinned by the strong bi-lateral relations between the UAE and China and we are focused on helping them grow in this region, which is home to a number of the world’s fastest-growing markets.”

Song Shuguang, Chairman of SINOSURE, added, “It’s a great delight for SINOSURE to witness the establishment of Dubai Office in DIFC on the 20th anniversary of the founding of our company. SINOSURE’s presence in DIFC reaffirms our commitment to increasing trade and investment opportunities for Chinese companies across the Middle East and South Asia. Dubai is the ideal ecosystem for Chinese businesses looking to expand in the region and we are confident that our presence at DIFC will unlock a vast array of opportunities and drive value for ourselves and our stakeholders.” 

  • Tyler is a Fintech Junior Journalist with specific interests in Online Banking and emerging AI technologies. He began his career writing with a plethora of national and international publications.