Global Access to Open Banking Delivered Through NXTsoft and Yapily Partnership

A new partnership has been announced between NXTsoft and Yapily that is set to enable each of the companies to expand their API reach and expertise into the other’s respective geographic areas in the United States and Europe.

The formation of this partnership will mean that NXTsoft’s API partners will have the ability to connect with European financial institutions, whilst Yapily’s European partners will have established API connectivity access to U.S-based financial institutions.

NXTsoft and Yapily are both prominent figures on the open banking forefront due to their expertise in API connectivity, and a partnership between the two is expected to significantly expand the connectivity potential for their fintech partners who want to integrate their services with financial institutions.

The open API solutions that NXTsoft and Yapily offer help to level the playing field between community banks and larger financial institutions. These APIs enable community financial institutions to quickly scale functionality to offer the myriad of digital services that consumers now demand. As such, this gives all consumers more choices of how and where they bank.

Because of the API technology developed by NXTsoft and Yapily, financial institutions are no longer at the mercy of their core providers, waiting potentially years before the connectivity is developed to a solution they want to utilise. Fintech companies are no longer burdened by core connectivity constraints. They can focus on the development and enhancement of their flagship solutions and innovation instead of how to connect A to B.

“A NXTsoft and Yapily partnership is a home run for NXTsoft as it significantly expands the financial market for which we can offer our partners entry,” said David Brasfield, CEO of NXTsoft. “We are excited to partner with a company like Yapily that understands the significance of open banking and the power of API connectivity.”

NXTsoft has been in the API market space for over 25 years and has over 1,000 financial institutions that currently utilise its secure open API solution OmniConnect to transmit data in real-time between core systems and applications.

Stefano Vaccino, CEO, YapilyStefano Vaccino, CEO, Yapily
Stefano Vaccino, CEO, Yapily

“As Yapily continues to grow and disrupt global financial infrastructure through our focus on open banking, a partnership with NXTsoft providing entry to the U.S. financial market is a huge step forward for us,” said Yapily CEO Stefano Vaccino. “Open banking infrastructure is fundamental to how data and payments move between organisations worldwide and Yapily and NXTsoft are poised to make that connectivity happen.”

Yapily recently completed a second round of Series B funding totaling $51 million, bringing its total investment to date to $69 million. The company will reportedly use the funding to expand across Europe, extending open banking to cover 95% of the continent by the end of the year; and will continue to invest in its infrastructure to pave the way for open finance; thus accelerating financial inclusion.

Financial institutions have an enhanced ability to implement the solutions that customers demand, consumers have more choices in how and where they bank, and fintech providers can focus on the innovation and deployment of new solutions – in part due to the open API solutions and collaboration between NXTsoft and Yapily.

  • 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.

UK Fintech News Round-up: The Latest Stories 29/09

Each week we take a look at some of the latest finteh news stories from the UK. This week, Half of UK regulated firms report rise in financial crime and New analysis reveals at least six million are ‘ID Challenged’.

Nearly half of Brits spend all their monthly wage and depend on credit at least once a year

Debt management company Lowell has conducted research into the spending habits of Brits following payday, including how fast Brits spend their wages and how many depend on credit following a spending spree.

It revealed that nearly a quarter (24%) of Brits do not put any of their wages into savings or ‘rainy day pots’ and with almost one in 10 Brits (9%) spending up to 60% of their wages within the first week of payday. The study also found that half of Brits (48%) spend all their wages and depend on credit at least once a year, with 13% of Brits doing this every month.

John Pears, UK CEO of Lowell, said: “Unfortunately, this research confirms that many people across the UK are caught in the trap of living from payday to payday, but this can be a slippery slope into unmanageable debt if your circumstances were to change unexpectedly. If you’re struggling to keep track of where your money is going each month, try to set some time aside to tot up all your outgoings and build a clearer picture of your expenses. Once you know this, plan ahead by creating a realistic monthly budget that you know you can afford. Sticking to this is a great way to help get your finances back under control and avoid accidental over-spending.”

UK businesses fear increased risk of data breach as a result of hybrid working

More than eight in 10 (83%) UK businesses say hybrid working increases the risk of a data breach, yet over a fifth (22%) remain unprepared if it happens, ­­with speed of response the top concern.

According to new research published within TransUnion’s Data Breach Support for Businesses ebook, business leaders expect 43% of their workforce to be hybrid working in the coming year, splitting their time between the office and remote working. Yet this change to working practices means a far greater potential for devices and data to end up in the wrong hands.

Hybrid working is currently seen as the top data breach threat, identified by almost a quarter (23%) of business leaders. This is because workers are now regularly switching between secure office environments and vulnerable home networks, and handling sensitive information on either public or unsecured private networks. As a result, the risk has increased for both accidental and malicious data breaches.

Millennials say their faith in insurance has increased

Embedded Insurance Insurtech

Embedded Insurance Insurtech

A third of millennials say their faith in insurance has increased since Covid, and across all ages, 77% of people in the UK who currently have car, home or contents insurance say their faith in insurance to deliver when needed has not changed since Covid. This was slightly higher for women than men at 83%.

Over half (59%) of people agree that insurance in the UK is still fit for purpose, and this is most strongly felt amongst millennials (52% agreed). Only 7% of people disagree with this statement.

Christian Wiens, Founder & CEO of Getsafe, comments: “The results of this survey will surprise many as they appear to contradict the current consensus from the industry that its reputation has been severely sullied over the past 12 months, due to the fallout from Business Interruption claims during Covid, issues around dual pricing, and the impact of a hard market.”

Half of UK regulated firms report a rise in financial crime

Cybercrime (Image Source:

Cybercrime (Image Source: half (48%) of regulated firms in the UK reported seeing a rise in financial crime attempts in the past 12 months, with a further 26% confirming they have been victims themselves – according to new research by RegTech firm SmartSearch.

The survey of 500 regulated businesses in the financial services, legal and property sectors found just a quarter (25%) said they have not seen any change in the level of financial crime attempts. The increase in financial crime and money laundering has been driven primarily by the gaps in security that opened up due to the global coronavirus pandemic, as businesses rushed to adapt to new working practices.

 CEO John Dobson said: “There’s no doubt the conditions since the outbreak of coronavirus have been ripe for criminals to seize the opportunity for money laundering and other fraudulent activities in the property market. They have been able to do this because a lot of businesses still rely on manual methods of verification when onboarding new customers.

“Even so, the fact that half of the businesses we surveyed have reported an increase in criminal activity brings home the sheer scale of the problem. The most effective way of preventing this is by switching to a digital solution which does away with the need to rifle through documents which are easily forged by today’s organised crime gangs.”

UK customers switching banks due to complaints handling process

Research released reveals that UK customers are leaving their banks due to the mishandling of customer complaints during COVID-19.

The 2021 Global Regulator Report by global software company Nuix shows that banks are failing to address complaints adequately, leading to a loss of customers. A quarter (25%) of UK banking customers who complained said they wouldn’t use the same bank in future as a result of the company’s handling of their issue.

Among the banking customers surveyed, two-thirds (66%) have complained within the past 12 months, and almost a third (32%) of those who complained said their problem had not been resolved.

New analysis reveals at least six million are ‘ID Challenged’

Mitek: Trust Will Turn the Tide in the UK Banking Industry

Mitek: Trust Will Turn the Tide in the UK Banking Industry

New analysis from the Open Identity Exchange (OIX) reveals that at least six million people can be classed as ‘ID Challenged’, meaning they likely struggle to access government services such as Universal Credit.

With millions lacking a passport or driving licence, the research identified the extent of the UK’s identity challenge, leaving millions of the public unable to validate or verify themselves on services like GOV.UK Verify. This is because government and private sector services rely on users to have either a passport, driving licence or online banking and non-bank credit account and provide evidence of these online.

Nick Mothershaw, Chief Identity Strategist, OIX commented: “Digital ID will only work if it’s truly inclusive and that means opening up access to more datasets, often government data. This will be vital in enabling more people to prove who they are and get access to the services they are entitled to. Anyone who wants to use a Digital ID to access services should be able to create one, and the process of setting it up should be as easy as possible.

81% of adults say the quality of online experience determines who they bank with

81% of adults say the quality of online experience determines who they bank with, according to new research by digital agency MagiClick and conducted by YouGov into post-pandemic digital banking trends in the UK.

Use of online web banking overall rose significantly, with half (50%) of those who have used digital banking services more since the pandemic began stating they have used online web banking more often. The highest rise in usage for online web banking was amongst the 55+ age group (60% using this service more often).

Mark Lusted, MagiClick UK CEO, said: “This research clearly shows that the events of the past 18 months have accelerated the adoption of digital banking services by consumers across all age ranges.

“The quality and ease of use of the digital experience is clearly now of high importance to a large majority of users when choosing who to bank with and, interestingly, this was of highest importance to the over 55s. In an increasingly competitive landscape, with an array of new digital-only challenger banks entering the market, incumbent banks should take note.”

Millennial investor habits have changed with Covid

Barclays Support Lance's Freelancer Orientated Business Bank Account

Barclays Support Lance's Freelancer Orientated Business Bank Account

Millennials have changed their overall investment habits the most during the pandemic according to research by MoneyTransfers. 1/3 of millennials take ‘Environmental, Social and Governance’ factors into account when they invest (only 19% of Gen Z, 16% of Gen X and 2% of Boomers)

Jonathan Merry, CEO of comments: “As the global economy and stock markets stabilise further, millennials are likely to show even more confidence in their portfolios and report a larger appetite for risk. That could mean assets like cryptocurrencies and NFTs, but it could also expand to broader investment opportunities as millennials’ knowledge base grows.”

  • 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.

Vanquis: How Fintech Partnerships Are Cultivating Greater Financial Inclusion

Passionate about innovating and breaking the barriers of financial exclusion, Sol Enenmoh (Head of Digital Transformation at Vanquis) is eager to encourage the finance sector to think differently and adopt new ways of working.

Sol Enenmoh, Head of Digital Transformation, VanquisSol Enenmoh, Head of Digital Transformation, Vanquis
Sol Enenmoh, Head of Digital Transformation, Vanquis

Prior to his role at Vanquis, he’s worked in transformation leadership roles in large organisations, including EY, HSBC, NatWest, Lloyds, and bp (Retail and Payments division), driving commercial success through changes in culture, channel shift, capability uplift, and process changes.

Here Sol explains how Vanquis’ partnership with credit builder LOQBOX is rooted in a need for greater financial inclusion.

Working in the banking sector is more than providing financial services – it’s about people. Over the past 18 months, there’s been a dramatic increase in the number of people needing help. Over nine million people were put on furlough, many lost their jobs, three million of the self-employed relied on government grants, and many had to take payment holidays on their credit cards and mortgages to get by day to day.

In the UK, 1 in 5 adults are typically declined for credit by mainstream lenders. That’s approximately 12 million people who are excluded by the big-name banks, yet still require access to credit. These people might have experienced a significant life event impacting their finances, such as a divorce or job loss, or they might simply be managing life on a lower-than-average income. For people who are new to credit, it’s a catch-22. Mainstream banks aren’t confident in lending to people with little credit history, so how are they supposed to build it?

This is where Vanquis sits in the market. We offer products to people who are typically declined credit to help them move forward in life. Unfortunately, we can’t offer credit to every person who applies as it might not be in their best interest at the time, and in some cases, it might cause further financial detriment. For those struggling, this can cause high levels of uncertainty and anxiety, and it can feel like they are left without choices. However, whatever their circumstances may be, no one should be left in the dark and their journey shouldn’t end there.

Everyone should have the opportunity to access tools and services to support them financially.

Through partnerships, we can extend our offering and make sure no customer is left behind. In early 2021 we partnered with LOQBOX to give declined applicants a tangible next step to build their credit score and improve their financial habits. It’s the first partnership of its kind in the industry where a lender will signpost an alternative, appropriate solution rather than ending the journey there with little clarity on the next steps.

Taking this route with LOQBOX puts the power back in the customer’s hands and offers a chance for them to build their credit profile. They decide on an amount they can afford to save in a year (through a minimum monthly payment of £20 and maximum £200), a 0% loan for this amount is locked away with LOQBOX and they pay it off over 12 months. When customers make their payments on time and demonstrate good habits, this is reported to the credit reference agencies and contributes to building their credit score. Once the year is up, the money saved is released into a bank account. Vanquis and LOQBOX regularly touch base with the customer during this time, and when it’s believed they have a better chance of approval for a Vanquis card, they will be recommended to reapply.

We share the view with LOQBOX that financial education plays a fundamental part in tackling financial exclusion. As LOQBOX customers, they have access to a whole host of resources to help improve their money management, get them back in financial shape and achieve their goals.

The first customers that were referred to LOQBOX are now several months into their journey, so we have a robust set of data to examine. For example, it will indicate how customer behaviours may have changed, what impact it has on their credit score, and the next best actions, which may be to re-introduce them to Vanquis.

Looking into the future

Given that government support schemes are coming to an end, we’re likely to see even more people needing extra financial support. Now more than ever, businesses need to work together to come up with innovative ways to help people.

Our partnership with LOQBOX demonstrates the value of fintech partnerships in addressing key social issues. Finance isn’t a one size fits all approach and they are built in a way that allows for a more flexible, tailored service to address the needs of underserved consumers. Fintechs often operate in a more dynamic way and have fewer limitations with things like existing processes, allowing them to deliver projects and new products at a faster pace. They’re able to respond and adapt quickly to changing landscapes, which has been particularly valuable throughout the pandemic, bridging gaps that typical financial services providers would have struggled to.

Working with LOQBOX, we have been able to continually evolve our partnership model. We learned more about how it works and its value in the first few weeks of going live than we did debating the theory and discussing rigid commercial KPI’s pre-launch. It highlights the importance of exploration and experiments with new products, partnerships, and ways to support people financially.

There’s a long way to go to end financial exclusion. Taking on these lessons learned and being open to new ways of working, allows us to be more innovative in bridging the gaps to better serve the 20% who are currently financially excluded. We’re looking forward to identifying new opportunities and new partnerships to tackle more financial barriers for UK consumers.

Stablecoin News for the week ending Wednesday 29th September.

Are Stablecoins superior to TradFi?

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

An important question was answered this week.  Are we really taking a step forward in terms of value with this new technology over the current Financial Infrastructure often referred to as TradFI?

First a reminder of how regulators would find that the DLT technology is superior to the current financial system, it leaves a very good audit trail of who did what.  The United States Attorney’s office recently filed a civil complaint accusing four digital wallets containing more than 9.8 million Tether (USDT) of being involved in wire fraud, computer fraud, and money laundering

U.S Government sues for millions of USDT purportedly stolen – Nairametrics

Now onto interoperability, in the really new world of DeFi, Solana users can swap wrapped stablecoins via a Mercurial Finance liquidity pool.  Mercurial Finance has launched a liquidity pool for Wormhole wrapped stablecoin assets, the decentralized exchange announced Friday.

  • Mercurial Finance is conceptually similar to Ethereum-native Curve Finance, a decentralized exchange optimized for swapping like-assets such as two different stablecoins. Mercurial is backed by the DeFi Alliance incubator.
  • Wormhole has been expanding aggressively to new asset types, and with new functionalities. Earlier in the month, Wormhole v2 launched to provide a bi-directional bridge for a variety of tokens, including non-fungible tokens (NFTs).
  • In a tweet today, Mercurial Finance wrote that the pools will help ensure the end-to-end decentralization of stablecoin assets on Solana.
  • A press release from Mercurial said that users who provided liquidity to the USDC-wUSDC-wUSDT-wDAI cross-chain pool could earn up to 159.5% APY. The yield currently sits at 33%.
  • Jump Crypto is a lead contributor to Wormhole, and the firm has also backed and helped to develop the Solana-native oracle service Pyth.

Bridged Stablecoins on Solana Get a Boost With Mercurial Finance Pools — CoinDesk

And Finally, validation from the Central Bankers, Banker (BIS or Bank of International Settlements) that stablecoins can dramatically cut the costs of cross border payments.

According to the report titled “Inthanon-LionRock to mBridge: Building a multi CBDC platform for international payments” published on Tuesday, CBDCs can reduce the transaction throughput of cross-border payments from three to five business days to only a few seconds.  

Inthanon-LionRock to mBridge: Building a multi CBDC platform for international payments (

“A prototype of multiple Central Bank Digital Currencies (mCBDCs) developed by the Bank for International Settlements Innovation Hub and four central banks demonstrated the potential of using digital currencies and distributed ledger technology (DLT) for delivering real-time, cheaper and safer cross-border payments and settlements.

The mBridge project is a cooperation between the BIS Innovation Hub Hong Kong Centre, the Hong Kong Monetary Authority; the Bank of Thailand; the Digital Currency Institute of the People’s Bank of China; and the Central Bank of the United Arab Emirates.

The common prototype platform for mCBDC settlements was able to complete international transfers and foreign exchange operations in seconds, as opposed to the several days normally required for any transaction to be completed using the existing network of commercial banks and operate in a 24/7 basis. The cost of such operations to users can also be reduced by up to half, according to this report.”

CBDCs can cut cross border remittance costs by half: BIS report (

So in summary, this week we had more confirmation that this new stablecoin technology is faster, better and cheaper than TradFI.


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.

Despite the Digital Move, People Still Want Their Banks To Have Branches Finds Toluna

The Toluna Financial Services Sentiment Indicator (FSSI) is a bi-annual study exploring key issues related to the UK population’s personal and household finances, attitudes towards financial institutions in the UK and behaviours in relation to personal finances. The latest research surveyed a nationally representative sample of 1,081 members of the UK public.


Confidence in who we bank with remains high – in sharp contrast to how we feel about the UK government.

High street banks and building societies are leading the charge when it comes to higher confidence in financial institutions.

  • 55% of those surveyed had confidence in their bank or building society
  • 54% of respondents said that they have high confidence in the Bank of England
  • Insurers, IFAs, and investment and pension providers have all seen confidence levels increase by 4-6 percentage points since last year (May 2020).

In contrast, confidence in the UK Government is continuing to decrease, following a high point of 43% in May 2020 which currently stands at 35% (a decrease of 8% points in the last year).

Despite ever-increasing use of digital banking services and bank branch closures rising, it’s clear the UK public is still keen to use bank branches for a number of reasons, especially those aged 18-34 years old:

  • Two in three (66%) respondents have visited a branch of their main bank within the last 12 months
  • Surprisingly, this figure rises to just under four in five (78%) amongst 18–34-year-olds and around three in five amongst 35–54-year-olds (61%) and 55+year-olds (60%).

Amongst those not having gone to their bank branch in the last six months, two in five (40%) still stated that they feel it was still important to have access to a bank branch. So why do we want access to a local bank branch?

  • Nearly half (46%) of those who felt it was important to have access to a bank branch said that they think it’s important for “in-person advice in case of any issues”.
  • A third (33%) said they ‘enjoy face to face interaction with staff’, with 29% stating that it gives them peace of mind. Interestingly, a quarter (25%) of respondents said that banking in person at a local branch gave them a greater sense of security when completing transactions.
  • 27% of 18–34-year-olds believe that having a local branch of their main bank is important to them because the “services they need are not available online,” compared to 35–54-year-olds (9%) and 55+ year-olds (12%).
  • Alternatively, 55+ years-olds (27%) stated that having a local branch of their main bank is important to them because they “don’t like using online/mobile banking, “compared to 35-54-year-olds (9%) and 18–34-year-olds (3%).

Communication from financial services firms must improve from a clarity perspective

Throughout the pandemic, most public and private sector organisations in the UK have looked to help customers access the services and products they need to ensure limited interruption to their day to day lives whether that’s freezes on loans and credit cards, through to furlough payments.

Nearly three in five (58%) of the UK public recall receiving communications offering support in response to the pandemic, with email being the most popular method financial institutions have used to contact customers (44%). This was followed by letter (22%) and a phone call (9%)

Clarity of communications, however, has fallen short of the mark

Of those people who were contacted, only (48%) found all communications to be extremely clear and easy to understand.

One in eight (13%) found the communications from financial services organisations offering support difficult to understand, containing lots of jargon and being extremely unclear.

As a result:

  • 17% of those surveyed said this made them ‘uninterested’ in the communication received
  • 14% said it made them feel resentful or skeptical
  • 9% of respondents said they felt unsupported
  • And 8% felt worried

18-34 years old (66%) were most inclined to mention these negative emotions, compared to 35-54-year-olds (50%) or 55+ year-olds (29%).

Furthermore, those with speech/sight/hearing impairments (84%), learning difficulties (83%) or short-term poor health (81%) also gave negative feedback for these communications.

Mike Bamford, Research Manager in the Financial Services team at Toluna said:

“In a time when banking brands are looking to digitalise and streamline their business model, it is both interesting and reassuring to see such a large proportion have visited a branch in the last 12 months. In short, our research more than suggests that there is still a place for the bricks and mortar bank branch, as they serve the public on multiple fronts, ranging from social wellbeing offering the public interaction and reassurance, through to ensuring that those unable to service their account online are also not forgotten in the digital revolution.”

  • Francis is a junior journalist with a BA in Classical Civilization, he has a specialist interest in North and South America.

Only 34% Of Parents Invest – The Next Generation Need Better Financial Education Says SmartPurse

SmartPurse has conducted research that shows despite financial education being included on the UK’s National Curriculum since 2014, parents are still concerned about their children’s financial literacy. 

In this new report, ‘Invest in their future’, research from 250+ UK parents has found:

  • 66% of parents do not believe their children receive enough financial education
  • 78% believe that a generational money gap exists
  • Less than 2/10 parents talk to their children about money every day

When asked to rate their financial confidence from 0 to 10, the majority of UK parents selected 7/10. Examining these results from a gender-perspective, SmartPurse found that female parents are 2.5x more likely to rate their confidence below 3/10, and 1.2x more likely to rate it below 5/10, than their male counterparts.

Guy Rigden, CEO of MyBnk, a contributor to this report, commented, “Barely a third of 7-17 year olds say they have received any form of money lessons. We cannot continue creating generations of young adults who don’t know how to save or make informed decisions. For marginalised groups, such as girls and young women, the margins are just too thin. It drives inequality and blights mental health.”

One aspect of family finances hit hardest by a lack of education is investing. SmartPurse found that, for 72% of parents, their financial education impacts their decision to invest. Given that just 32% currently invest their money, the inadequacies of their education are clear.

94% of parents would start investing sustainably if they were told that this concept brought larger rewards. Olga Miler, Co-founder of SmartPurse, spent over a decade working in financial services, and specialises in gender-smart investing.

“In the midst of all the tragedies our world has faced over the last few years, there has been one positive shift: the increasing popularity of sustainable investing. Our research shows that while UK parents want to teach sustainability to their children, a lack of access to and understanding of this process keeps them from gaining practical experience. If we want this popularity to continue, our children need to be educated on the opportunities of their money, and this education starts with their parents.”

‘Invest in their future’ includes key insights into the generational money gap and how newly emerging trends, from cryptocurrency to sustainable investing, impact the younger generation, featuring expert contributions from MyBnk and nimbl.

  • Francis is a junior journalist with a BA in Classical Civilization, he has a specialist interest in North and South America.

PayNow-DuitNow 2022 Linkage Expected To Drive Paytech Development Across Singapore and Malaysia

The Monetary Authority of Singapore (MAS) and Bank Negara Malaysia (BNM) have announced their plans to commence a phased linkage of Singapore’s PayNow and Malaysia’s DuitNow real-time payment systems.

Customers will be able to perform retail payments by scanning NETS or DuitNow QR codes displayed at merchants’ storefronts. The project will enable more seamless remittances between Singapore and Malaysia, which previously peaked at SGD 1.3 billion in 2020. It will also cater to travellers between both countries, which saw sizeable pre-pandemic traffic of about 12 million arrivals yearly on average.

The first phase of the PayNow-DuitNow linkage will reportedly be launched in the fourth quarter of 2022. This will allow customers of participating financial institutions to make real-time fund transfers between Singapore and Malaysia using just their mobile number.

Following the launch, MAS and BNM are expected to progressively expand the PayNow-DuitNow linkage to incorporate a range of increasingly sophisticated features and participants. Both regulators will also explore the feasibility of integrating innovative features such as distributed ledger technology-based solutions to catalyse greater efficiencies in payments clearing and settlement between participating banks.

Sopnendu Mohanty, Chief Fintech Officer, MASSopnendu Mohanty, Chief Fintech Officer, MAS
Sopnendu Mohanty, Chief Fintech Officer, MAS

The PayNow-DuitNow linkage represents another significant milestone in the history of close ties between Singapore and Malaysia. In this regard, Sopnendu Mohanty, Chief Fintech Officer of MAS, comments, “Singapore’s remittance corridor with Malaysia is our largest remittance corridor; hence, the PayNow-DuitNow linkage will be an important infrastructure to support cross-border payment needs of individuals and businesses, as well as the growing digital economic activity between both countries. The linkage also offers MAS and BNM a valuable opportunity to incorporate the use of distributed ledger and smart contract technologies in the wholesale cross-border payments space.”

The linkage closely aligns with the G20’s work of driving faster, cheaper, more inclusive, and more transparent cross-border payments, and is a concrete step towards achieving an ASEAN network of linked real-time payment systems.

Fraziali Ismail, Assistant Governor, Bank Negara MalaysiaFraziali Ismail, Assistant Governor, Bank Negara Malaysia
Fraziali Ismail, Assistant Governor, Bank Negara Malaysia

Fraziali Ismail, Assistant Governor of BNM, added, “By bringing the efficiencies observed in domestic payments to cross-border payments, the PayNow-DuitNow linkage will be a game-changer resulting in faster, cheaper and more accessible payment services for the people of both countries. Not only would this initiative further strengthen the economic ties between Singapore and Malaysia, it would also serve as a key enabler to support post-pandemic economic growth.”

  • 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.

Cross Border Payments Infrastructure Innovator Buckzy Payments Inks Partnership with M2P Solutions

Asia’s largest API infrastructure company, M2P Solutions, will leverage the real-time, cross border payments ecosystem developed by Buckzy Payments to enable its customers to offer better payment services in many of the more underserved corridors in the MENA region. Clients such as banks, exchanges, and money transfer operators (MTOs) will be the partnership’s chief beneficiaries; targeted markets include the UAE, Saudi Arabia, Bahrain, Kuwait, and Oman.

“We are clearly aligned in our mission to improve global banking and transaction settlement services that unlock the borderless banking and global economic opportunities for all,” Managing Director for Buckzy in EMEA Adrian Brown said. “Combining Buckzy’s network with M2P’s API platform delivers an outstanding customer experience and competitive advantage for customers.”

Buckzy’s network enables real-time, cross border payments around the world. The company’s technology gives both businesses and financial institutions the ability to expand their offerings via white-label solutions on a secure platform. Moreover, Buckzy’s ecosystem also empowers these organizations to make collections and receive payments in local currency. Headquartered in Toronto, Ontario, Canada and founded in 2018, Buckzy demonstrated its solution one year later at FinovateFall. At the conference, Buckzy Global CMO Lindsay Mulligan showed how the company’s technology powered instant, on-the-go digital wallet transfers and top ups, as well as multi-currency transfers and instant email money transfers with just a few clicks and without transaction fees.

Business Head of M2P Solutions for MENA, Vaanathi Mohanakrishnan, underscored the importance to the company of opening up these regional opportunities. “A lot of M2P’s strategy hinges on enabling fintechs to deliver solutions leveraging our infrastructure and partner network,” Mohanakrishnan explained. “We are excited to be partnering with Buckzy to deliver frictionless cross border payment experiences to customers in the MENA region.”

Delivering real-time cross-border payments to 47 countries, Buckzy Payments was recently named to the CIX Top 20 Early roster of innovative Canadian technology companies. With offices in the U.S. and India, as well as Toronto, the company has raised $3 million in funding from investors including Dash40 Ventures, Mistral Venture Partners, and Revel Partners.

Photo by Louise Brawn from Pexels

FIs look to disaster recovery solutions amid ransomware attacks

Core provider Jack Henry reported an uptick in the number of financial institutions integrating its backup and recovery solutions in response to this year’s escalation in ransomware attacks.

The Gladiator Centurion Enterprise-Level Recovery (CELR) solution is backing up 80% more financial data than it was 18 months ago, according to the Missouri-based Jack Henry. CELR backs up a bank’s data in encrypted file transmission then moves it into storage. This ensures that if a bank is targeted by a ransomware attack that has altered its data and wants a payout to correct it, the bank has an offline record to restore its systems, Stacey Zengel, senior vice president and president of Jack Henry Banking, told Bank Automation News.

“The key thing you have to have encryption. You have to have several copies as well, because you might have gotten compromised with ransomware five days ago,” Zengel said. “And that’s usually where [hackers] operate, they’ll sneak something in and then, you know, a few days go by and all of a sudden you have an issue.” More than 300 banks and credit unions are using the core provider’s CELR solution, she added.

CELR provides cloud-based backup and recovery by installing software at the bank that sends a backup of a bank’s servers and third-party enterprise systems offsite to Jack Henry’s facility located 175 feet underground in Branson, Mo. Jack Henry’s backup solution backs up to air-gapped cold storage. Air gapped means the data is taken offline so it’s secure from cyberattack. Cold storage – in some cases relies on pulling tapes to back up – costs less but is slower to retrieve than “hot storage,” which is used by always-connected cloud providers such as Amazon and Google. If an emergency or disaster occurs, the financial institution uses a virtual server recovery module to remotely access the backed-up systems from a Centurion recovery center.

The air-gapped cold storage is key to the $293.9 million Citizens Bank & Trust’s disaster recovery planning, Senior Vice President Annette Hord said in a press release. The bank is headquartered in Campbellsville, Ky. “Today, with added vulnerabilities from ransomware attacks, knowing that backup is in air-gapped cold storage is vital to our continuity planning,” Hord said. “It’s an added layer of defense that can preserve our data and our reputation as a trusted financial institution.”

Jack Henry recently launched another security feature called SecurePort, a solution that helps banks provide end-users with timely access to their accounts in case bank systems fail. SecurePort moves critical data into a source vault that is encrypted, unchangeable, and completely separated from the bank’s infrastructure and resiliency planning, with a designated restoration platform. An early adopter is the $1.2 billion Las Vegas-based Meadows Bank.

This year has been marked by high-profile ransomware attacks, including the Colonial pipeline attack and the REvil attack on meat supplier JBS S.A. which paid out an $11 million ransom to the Russia-linked ransomware gang. There’s more at stake than just attacks: Last week, the Biden administration announced it will be more rigorous about tracing ransomware paid out to hackers, a move that could impact banks and other financial institutions.

Listen: Bank overtakes Facebook in hackers’ playbook

Facebook for years may have topped cybersecurity firm Vade’s “Phishers’ Favorites,” a report of the most impersonated brands in phishing attacks, but the $2 trillion Credit Agricole bank recently edged out the social media giant with 17,755 unique phishing URLs. Facebook’s topple from the No. 1 spot was a surprise, Adrien Gendre, chief product officer […]

The Arab Financial Inclusion Innovation Prize 2021 Winners Include Stryve and Mozare3

The Arab Financial Inclusion Innovation Prize (AFIIP), which equips promising innovators with the funding and support they need to realise their potential to further financial inclusion in the Arab world, has announced its 2021 winners.

AFIIP has become one of the Arab world’s lead scouts for innovations in the field of financial inclusion.  This year, AFIIP 2021 received over 120 applications from increasingly innovative solutions across the region; not only from countries with established innovation eco-systems, such as Egypt, Morocco and Jordan, but also from countries such as Somalia, Yemen and Iraq.

This year, in preparation for COP 26 and to bring the environment to the forefront of the entrepreneurial discussion, AFIIP also launched a green prize to provide additional resources to financial innovations that can generate green outcomes.

A panel of ten judges with extensive and varied experiences in innovation, financial services and sustainable development evaluated the proposals based on the AFIIP criteria of impact, innovation, implementation, marketability and team. The winners will now receive grant funding and technical assistance to help scale their innovations.

Who are the main prize winners, making financial services more accessible?

First prize: Stryve, Egypt

Stryve provides unbanked SMEs in Egypt with digital banking products, with a focus on invoice financing. Stryve plans to use their innovative model to bring a buy-now-pay-later solution to small businesses, through strong partnerships with both suppliers and buyers. In such a way, Stryve will address the country’s sizeable SME finance gap and improve the efficiency of B2B purchases.

Second prize: Ahmini, Tunisia

Ahmini is tackling the critical issue of social protection and insurance by acting as an intermediary for rural women in Tunisia to seamlessly and remotely onboard them onto the national social security system (CNSS). In addition to the onboarding process, Ahmini links women to mobile payment providers and allows them to break up their premiums into instalments. 80% of rural women in Tunisia lack access to health insurance and the CNSS, drastically reducing their ability to recover from unanticipated shocks. Ahmini’s offering addresses this shortfall, which is a barrier to economic stability not just in Tunisia but across the Arab world and beyond.

Third prize: Syndo, Egypt

Syndo is a crowdfunding platform that provides SMEs in Egypt with access to finance through a peer-to-peer solution. It allows SMEs to get loans while allowing individuals to invest their money in an alternative way. If successfully implemented, the solution will empower savers in the Egyptian market to get directly engaged in SME financing. SMEs can also use the platform to market their services and products.

Who are the green prize winners, innovating finance and generating green outcomes?

Winner: Mozare3:

Mozare3 is a solution that digitises the agricultural value chain in Egypt, working with smallholder farmers to provide access to finance, access to market and technical assistance, three of the main challenges that smallholder farmers face. Along the way, they encourage sustainable and carbon-efficient farming practices.

Winner: Plastic E-wallet:

Plastic E-wallet is building trust in financial services through cleaning up the Nile. The Plastic E-wallet team work directly with unbanked fishermen, providing them with income based on the amount of plastic they remove from the Nile. Their solution customises already existing cashless payment systems to the fishermen’s context, thereby providing a cashless payment system to previously unbanked informal micro-entrepreneurs.

A special mention should also be made to the AFIIP 2021 finalists, all of whom have impactful solutions:

  • Tanda, Jordan
  • Finllect, UAE
  • Digital Dinar, Tunisia
  • PowerCARD Microfinance, Morocco
  • Fundbot SAS, Lebanon
  • Kashat, Egypt
  • ZainCash, Iraq
  • Clickfunding, Egypt
  • Hagbad Mobile Application, Somalia
  • EyePay Network, Jordan
  • ONE Cash, Yemen
  • Wesharish, Tunisia
  • Attadamoune Microfinance
  • Verofax

AFIIP is enabled by SANAD Technical Assistance Facility, FSD Africa funded by UK Aid from the UK government and Spectrum Digital Holdings.

  • Francis is a junior journalist with a BA in Classical Civilization, he has a specialist interest in North and South America.

PXP Financial: Why Payment Providers Need To Build Trust With Merchants in the US Gaming Market

The regulation laws in the states within the US often do not agree with each other – what is legal in one state is illegal in another, making establishing consistent company regulations that span across the country hard. Gaming and sports betting merchants looking to expand must abide by state laws but working alongside payment service providers can make this challenge more bearable and reduce friction during expansion into a new state.

Kamran Hedjri is the CEO at PXP Financial. Hedjri has 20+ years of experience in holding C-level roles in the fintech and payments industry. He has built companies across the payment value chain in Europe, North and South America.

Hedjri explains how trust and adaptability are the most important thing a payment service provider can offer a gambling merchant to make their expansion as seamless as possible: 

Kamran Hedjri, CEO, PXP FinancialKamran Hedjri, CEO, PXP Financial
Kamran Hedjri, CEO, PXP Financial

In the United States, constitutional laws allow states to create, implement and enforce their own individual regulations This is because every US state is considered its own sovereignty and the unique characteristics of each state, such as demographics, population and social standards, warrant unique laws – on top of the countrywide federal laws. For a country as large as America, this makes sense. After all from coast to coast and throughout the middle of America you can find different climates, environments and cultures, to the point where they almost feel like different countries entirely.

But for businesses hoping to operate across the entirety of the US, much like they would in any other country, this becomes a challenge. Gaming and sports betting is no exception as each state has its own set of laws and regulations that merchants and payment service providers (PSPs) need to follow. The simplest solution to navigate this climate is for the payment providers and merchants to work together, but in order to do so whilst ensuring there is no friction with the service of either, trust needs to be established. And to establish that trust, the payment provider needs one thing: knowledge.

The complexities of US regulations

As each state has its own individual regulations to follow, licensing processes for both merchants and PSPs can be expensive, time-consuming and complex.  When entering into new states, new licenses are required for both parties, but there is no universal price for these licenses. It is set by the state and between merchant and provider licenses, one is more expensive than the other.

To address those complexities, PSPs and merchants have been forced to take a different approach to complying with regulation, as required by each state. For example, New Jersey only allows withdrawals from closed-loop cards which places a limitation on the end-user’s access to play. It also requires that cash be caged in a safe place at the casino, exchanged for tokens that must be used to play instead, requiring another step in the payments process. In contrast, throughout states such as Michigan, prepaid cards are not accepted at all, so there is a limitation on which closed-loop cards can be used. Some states take regulation further still, such as Tennessee, which explicitly forbids gambling merchants to accept credit.

What this means for merchants

All of these examples highlight the challenge for gambling merchants and payment providers alike when it comes to expanding into new states. This means that when moving a payment system into a new state, some of the process will have to be changed and the merchant will have to be prepared for the friction this could cause customers.

However, the regulations don’t exist within a vacuum. They are the result of a complex payment environment across the US that merchants need to know how to navigate and be compliant within. The issues, instead, come from the difficulty of doing so. From the high costs of manpower and time required to understand a new market it can sometimes feel like entering a new market is not worthwhile. But it is.

Successfully addressing the challenges of state-by-state regulation can allow gaming merchants to open up new customer bases, and payment providers with local knowledge can help speed up the journey. A payment provider can take on all the complexities of understanding the payment ecosystem in the US so that the merchant can focus on providing an engaging customer experience.

How fraud can potentially increase the level of friction present

Fraud is another factor to consider when dealing with separate regulations per state. The issue of fraud obviously creates friction for any merchant and risk systems need to be put in place to attempt to prevent any malicious activity. However, with the different regulations of each state and some states only just opening up to allow gaming and sports betting within them, both the state and new merchants in the area are prime targets for hackers.

We have already seen this play out in two states as they have begun to legalise gaming and betting. In Pennsylvania, the state had to work closely with various payment schemes in order to understand the actions that needed to be taken to prevent fraud cases. Likewise in New Jersey, which saw a dark period where fraud levels rose after launching new regulations in 2013. Both states have made progress when it comes to combatting fraud, but challenges still remain (especially in newly regulated states) as new security regulations are introduced and gaming operators struggle to implement fixes in time.

Solving the issue

So, what is the solution that PSPs can offer to merchants to successfully reduce the friction caused when entering a new state? The answer is to be adaptable and prepared. By delivering a full payments gateway that is flexible in what it offers, PSPs can easily adapt it to the needs of the merchant in each state, making expansion a more seamless process.

The payments gateway can also include security processes to fight against fraud, although depending on the severity, having a standalone system to manage this is also a possibility. Whilst incorporating anti-fraud measures may increase payment friction, providing a more secure service would lead to a better experience for customers overall.

However, the best way that payment providers can reduce the friction of moving into a new state and help merchants comply with regulators is by showing that they are dependable and a provider that can be trusted. The ecosystem is a complex one but by advising merchants and showing that, as a provider, you are ahead of the game and can adapt to any situation the state puts forward, the challenges associated with moving into new markets can be kept to a minimum.

Working with customers to empower them with advice and information is one of the fastest ways to build trust and ultimately provide a better experience for customers. When you give them actual and relevant information that helps the merchant, trust is indeed created and friction is lost.

Crypto and Blockchain Fraud Tackled With Liti Capital’s Scambusters Tool

Liti Capital SA, the Swiss-based litigation funding provider disrupting private equity investing with blockchain technology, is launching Scambusters, a revolutionary new tool that allows users to vote for which crypto-focused cases the company should pursue next.

Fraud within cryptocurrency and blockchain is rife. This year will be a record for investment fraud: 14,079 investment scams were reported to the FTC in the first quarter of 2021, and victims lost $215million in this quarter alone. Liti Capital is bringing its expertise in picking, funding and winning court cases and inviting consumers to vote on which scams it should pursue in court next.

“The idea that scammers can freely operate in the crypto sphere without facing the consequences of their actions must end to bring trust and change the perception blockchain and crypto projects have in our society”, says Andy Christen, CVO/COO at Liti Capital.

Liti Capital commits to allocating between 5% and 10% of its yearly investment budget to finance cases that have affected its community members. Any LITI or wLITI token holder can report a purported fraud to the company.

Scambusters is a community voting event to select crypto scam cases going to be sued by Liti Capital. LITI and wLITI token holders can use their tokens without spending them to vote for the case(s) they think have the most merit. The more tokens they have the more voting power they can exercise. Voters of the winning case will share an award up to 250,000 wLITI, distributed pro-rata to their votes.

Once members of the community have submitted cases on the Scambusters website, Liti Capital instructs its team of legal experts based in 140 countries across the world to explore details of the case.

A selection of cases are then presented back to community members, with the case collecting the highest number of votes being added to Liti Capital’s portfolio. Community voting begins on 23 September 2021, with the winning case announced on 15 October 2021.

“If cryptocurrency is going to become the defacto way people take part in the Web3 world, trust, regulation and a robust legal system are all parts of that puzzle,” says Jonas Rey, CEO at Liti Capital.

  • Francis is a junior journalist with a BA in Classical Civilization, he has a specialist interest in North and South America.

This Week in Fintech: TFT Bi-Weekly News Roundup 28/09

.Today’s The Fintech Times Bi-Weekly News Roundup delivers up a pot of fintech updates, including funding successes and industry appointments.

Job moves

Antony Stephen is named the new CEO of the bank’s point-of-sale finance business Barclays Partner Finance. His focus will be on growing the point-of-sale finance business in the UK, as well as providing senior leadership to Barclays Cubed, Barclays’ next-generation commerce platform.

Alfi Inc, the ad-tech and content AI SaaS platform company, has appointed Kevin Buchler as vice president UK and Europe operations, as the company looks to expand its European footprint. It has also opened a London office in Waterhouse Square, Holborn. Alfi already has offices in Miami, Denver and Belfast.

Meanwhile Yabx, a fintech venture offering credit products across 12 countries in Africa, has appointed Eunice R. Gatama as director for Africa Business. Gatama has previously worked with NCBA Bank Kenya and Safaricom PLC. Yabx has also revealed it is launching new service offerings to cater to customer needs.

Broadridge has hired Mike Johnson as vice president, global product manager of Derivatives Clearing. In his new role, Mike will be responsible for the continual enhancement of Broadridge’s leading global cleared derivatives platform. He will also leverage strategic client and industry partnerships.

interactive investor, the UK direct to consumer investment platform, has hired Victoria Scholar as head of investment. While Tracy Zhao joins as senior fund analyst. Scholar joins from IG Group, where she was a financial journalist and presented the business news at the firm’s IGTV broadcast channel. Zhao previously worked at The Share Centre.

Victoria Scholar and Tracy ZhaoVictoria Scholar and Tracy Zhao
Victoria Scholar and Tracy Zhao
More appointments

Encompass Corporation has appointed industry veteran Howard Dilworth as head of sales for its North America operation. He will focus on serving and leveraging existing US clients and opportunities within the region. His appointment coincides with the KYC provider onboarding its first top five US-headquartered bank, alongside other US firms and global banks using the Encompass platform.

Cornerstone, the cloud-based provider of international payment services to SMEs, has expanded into the Middle East. A new Dubai office is led by Robert O’Brien who joins as general Manager APAC and Middle East. His appointment is in line with the Group’s stated acquisition and expansion strategy.

Synechron, the digital transformation consulting firm focused on the financial services industry, has hired Rajeev Batra as MD insurance, North America. He most recently worked at Capgemini and has experience developing insurtech partnerships. 

Finally, fintech mx51 has recognised its chief operating officer and chief product officer as co-founders. Magnus Hsu (COO) and Steven Hadley (CPO) have helped mx51 process more than $1billion transactions and raise over $25million within a year of spinning out of Assembly Payments. The pair join CEO Victor Zheng as co-founders in the company while retaining their other role.


Banking software firm Temenos, cloud-native BaaS provider Vodenoa and European digital bank Aion Bank have unveiled a strategic collaboration to accelerate banking as a service deployment in Europe. The first banking services to be launched combine The Temenos Banking Cloud with Vodeno’s card management and payment processing services.

Abu Dhabi Islamic Bank (ADIB), the Islamic financial institution, has partnered with Spotii, a digital payments provider to introduce a virtual buy now pay later prepaid card in the UAE. ADIB customers can access their Spotii virtual prepaid card via the Spotii Mobile app.

Patch, the API-first platform for carbon removal, is launching a global rewards exchange for carbon offsets in partnership with fintech Ascenda. The portfolio will include projects ranging from traditional reforestation and forestry preservation programmes to disruptive frontier negative emission technologies such as direct air capture, biochar and mineralization.

While EllaLink and BSO launch strategic partnership to develop financial markets between Europe and Latin America. Together they will put in place the ultra-low latency connectivity and infrastructure to enable global trading firms to access the Latin American exchange.

Paynetics UK selects Thames Technology for card production across UK and Europe. The partnership lets Paynetics provide bespoke end-to-end card services to its customers. Thames Technology has Visa, Mastercard and UnionPay accreditation.

There’s also a new partnership for IFX Payments and Volt. The integration between IFX Payments’ virtual IBANs with Volt Connect, for UK and EU-based merchants, is described as a ‘significant development for open banking payments’. The joint solution will also provide the ability to initiate refunds and payouts.


Mastercard launches Strive UK to help micro and small businesses adapt and thrive in the digital economy. Strive UK helps small businesses to build financial resilience and improve growth prospects. The programme offers free guidance, helpful tools, as well as personalised, one-to-one mentoring.

Funding and investments

Brazilian wealthtech Sprout has secured $5.2million investment. The round was led by Y Combinator alongside and Sound Ventures, Liquid2, Geometry Ventures, HOF Capital, Quiet Ventures, First Check Ventures, Investo and The Marathon Lab. Sprout lets you make investments for $1 in more than 4,000 US stocks, funds and ETFs.

Meanwhile Doconomy has unveiled a $17million investment round. It brings the total invested in the climate impact technology firm to $24million since the start of 2018. The round, led by CommerzVentures, will accelerate the fintech’s growth and expand applied impact metrics globally.

Singapore-based fintech startup Aspire has raised a $158million series B round. The oversubscribed round was led by an undisclosed global growth equity firm. Additional investors include DST Global Partners, CE Innovation Fund, B Capital Partners and Fasanara Capital.



UK-based money app Ziglu has seen its £1million crowdfund oversubscribed in just 81 minutes on the Seedrs crowdfunding platform. Its previous crowdfund had a target of £1million but raised more than £6million. The second round launched on Monday in conjunction with a major Series A fundraise.

Fintech startup Coinrule enjoys a $2.2million seed funding round. Investors include Fitbit founder James Park, Twitch founder Kevin Lin and a fund in which Naval Ravikant is an investor. Coinrule has also joined the YCombinator S21 cohort. The company also plans to expand its user base to more than two million and automate $100billion in crypto trading volume.

Company announcements

Sonovate is named ‘Fintech Company of the Year’ at the Fintech Award Wales in Cardiff. It has also accelerated its recruitment drive in Cardiff, planning to boost its headcount from 108 to 150 by the end of the year. The fintech was also recently tipped to become the first fintech ‘unicorn’ in Wales.

Citi has unveiled a global technology hub at its Bahrain offices with plans to hire 1,000 coders over the next decade. The hub was set up in partnership with labour fund Tamkeen and Bahrain’s Economic Development Board.

Investing platform TradingView has reported record breaking growth over the pandemic, taking its lifetime users to 550 million people across 180 different countries. TradingView, which celebrates its 10th anniversary this year, also reported a 400 per cent increase in membership accounts and a 237 per cent increase in visitors in the past 18 months.

TradingView – available in 180 countries around the world
  • Claire works across print and online as Editor for The Fintech Times.

‘Developers are the new bankers’: Wells Fargo analysts predict wave of job cuts

The era of bankers dominating banking is over as software developers rise — and a record wave of job cuts will soon sweep the industry.

Photo by Bloomberg Mercury

That’s according to Wells Fargo & Co. analysts led by Mike Mayo, who estimated that the technology improvements and automation these developers bring will allow the industry to cut 100,000 jobs over the next five years.

“New job additions could lower reduction levels, but our conclusion is still that this will be the biggest reduction in U.S. bank headcount in history,” Mayo, along with six other senior equity analysts, said in a note to clients late Monday.

Banks spend more on technology than any other industry and had to set aside a whopping $200 billion for information technology last year alone. That’s meant the technologists they hire play an increasingly important role inside the world’s largest financial institutions, the Wells Fargo analysts found.

Many of the job cuts will hit lower-paid roles. The financial-services industry — which operates some of the world’s largest call centers — will likely “aggressively” reduce headcount in such locations, the analysts said. Branch workforces may drop 20% over the next several years, and could account for as much as one-third of banks’ total reduction.

Software developers wield greater influence over lenders’ purchasing decisions and budgets for their tools are ever increasing, the analysts found. That means banks are looking to add technologists and front-line employees to help manage their apps and websites as consumers rapidly adapted to new finance tools during the pandemic.

“Developers are the new bankers,” Mayo and the analysts said in the 110-page report. “These tend to be higher-paying positions, so it may be the case that while banks reduce headcount, they don’t lower compensation as quickly.”

Lenders have had trouble improving back-office functions, the analysts found. That’s partly because banks are deliberately cautious when upgrading those systems and they face extra regulatory oversight when doing so.

“Progress in the back office remains a slog,” Mayo and the analysts said in the report, noting such employees currently account for about half of all bank employees. “Some will succumb to technology, but others may require changes in regulation or laws to be fully eliminated. In any event, banks should be able to significantly cut back-office headcount over time.”

Banks have spent years promising that the extra spending on technology would ultimately help drive down costs. While it might be bad for job prospects, it’s finally poised to help profitability, the Wells Fargo analysts found.

If interest rates normalize over the next five years, it would shave more than 9 percentage points from the industry’s efficiency ratio — a measure of profitability that represents how much it costs to produce a dollar of revenue, Wells Fargo found.

“We believe tech requires banks to better compete, enables the biggest structural change in history, and puts record efficiency within reach,” the analysts said.

45% Of Payment Firms Are Failing To Meet the FCA’s Expectations on Capital Requirements

According to a recent survey by Compliancy Services, the UK-based provider of compliance consultancy and regtech services, 45% of firms are potentially breaching FCA regulations whilst failing to meet regulatory obligations.

In a supervisory engagement with the sector in 2020, the FCA noted a number of shortcomings in how firms had calculated their own funds requirement. An announcement was made in the ‘Dear CEO’ letter ‘Portfolio strategy letter for payment services firms and emoney issuers’, issued in July 2020, and firms were reminded to take action to meet the requirements.

Compliancy Services has identified that, despite this notification, many firms are still falling short of the requirements and misunderstanding exactly what the FCA is looking for. Compliancy Services held a webinar on 14 September 2021 to help firms understand the requirements.

During the webinar, Compliancy Services posed a question to the delegates asking, “how frequently they reviewed their firms’ regulatory capital position”. 45% were found not to be meeting the FCA’s expectations.

“The FCA requires firms to monitor their regulatory capital position on an ongoing basis, and anything less than monthly is unlikely to be acceptable especially in changing business conditions,” comments Harpartap Singh, Head of Prudential at Compliancy Services. “Ensuring that payments firms are meeting their regulatory capital requirement is an increasing area of focus for the FCA, so it is important that firms get it right.”

It’s also apparent that many firms are miscalculating their ‘own funds’. Retained profits may only be included in the ‘own funds’ calculation if the accounts have been audited. Many Authorised Payment Institutions (APIs) are classed as “Small Companies” under the Companies Act 2006 and are not required to undertake a statutory audit. This means that, unless they have chosen to have an audit in spite of the exemption, any profits they have made are not eligible for inclusion in the own funds calculation and this seems to have been catching many firms out.

John Burns, Technical Director of Payment Services, Compliancy ServicesJohn Burns, Technical Director of Payment Services, Compliancy Services
John Burns, Technical Director of Payment Services, Compliancy Services

According to John Burns, Technical Director of Payment Services at Compliancy Services, “The cross-referencing of the Payment Services Regulations and Capital Requirements Regulations, and the apparent mismatch between the Companies Act and the Capital Requirements Regulations can make the requirements difficult for firms to follow. While this may mean that, technically, some of these firms may not be meeting their required regulatory capital levels, as long as the unaudited profit figures are accurate it shouldn’t really affect the financial resilience of the firms in question. However, it is important that firms, and the FCA, are aware of this pitfall, and take steps to avoid it.”

  • 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.

Kinesis’ Holder’s Yield Enables Gold Investors To Earn a 15% Yield on Transactions Costs Each Month

Kinesis Money, the monetary system based on 1:1 allocated gold and silver, has launched its Holder’s Yield, whereby a portion of the yield pool, currently valued at $17.5million, will be distributed every month to people who hold gold and silver with Kinesis.

Until now, revenue amassed from the trading or investment in gold was speculative and subject to market fluctuations. Kinesis offers a competitive alternative, with a yield-sharing model that allows participants to increase their holdings of gold and silver, by paying a yield of 15% of overall transaction costs back to them each month.

This unique yield system makes Kinesis the only logical place to own gold, as Kinesis stores its metals in world-leading non-bank vaults and covers all storage and insurance costs on behalf of Kinesis users. Gold investors who switch to Kinesis can earn a yield on all gold holdings, as opposed to paying monthly fees like storage and insurance.

The Holder’s Yield combines the stable, enduring value of physical gold with a revolutionary model wherein users can earn a risk-free yield based on the mutual sharing of transaction fees as well as get access to its native trading exchange for a complete metals portfolio management solution.

Importantly, as inflation begins to soar globally, The Holder’s Yield, paid out monthly in gold and silver, offers a virtually inflation-proof model for the creation of a fortified digital asset portfolio, designed for inherent growth and persistent value – an unmatched way of safeguarding wealth in today’s unpredictable economic climate.

Marking a pivotal turning-point for the precious metals industry, gold has never been more accessible than at this very moment; Kinesis has taken gold, one of the most stable stores of value, and transformed the banking infrastructure surrounding the once hoarded, impracticable asset, so that it can be transacted like any other currency intended for mainstream uptake.

Cementing what is an industry first, the Holder’s Yield is just the second of five yields that Kinesis will be bringing online over the course of 2021/2022, making Kinesis gold and silver one of the most exciting investments in the precious metals space in the last decade.

Thomas Coughlin, CEO of Kinesis, says, “We’re calling on gold investors to make the switch to Kinesis. The Holder’s Yield is not just an industry first, it’s an economic first that renders traditional methods of storing gold obsolete. The yield that we distribute is based purely on transaction fees, meaning it can only generate a positive return – and with our growth, this will only keep growing. By turning the economic model on its head, and distributing some of our profits, we are creating a fairer and more ethical environment for our users to promote and encourage the use of digital gold.”

Andrew Maguire, Director of Kinesis, says, “What we’re witnessing here is truly revolutionary for the precious metals industry. It’s unheard of; a yield system based on usage and transaction fee sharing is the solution to risky trading strategies and debt-based loan systems where people’s investments are at risk. And guess what? It’s just the beginning.”

  • Francis is a junior journalist with a BA in Classical Civilization, he has a specialist interest in North and South America.

IBM: Why Digital Platforms are the Future of Banking

The pandemic has caused a massive shift in the way the public interact with financial services, most notably with their banks. Users found it very easy to access and use the new apps to solve simple queries that did not warrant going to a branch. 

As simplicity and accessibility become the top priorities for a successful company,  Bharat Bhushan, CTO, Banking and Financial Services at IBM UK & Ireland, looks at how the development of digital platforms will affect the banking sector:

Bharat Bhushan, CTO, Banking and Financial Services, IBM UK & IrelandBharat Bhushan, CTO, Banking and Financial Services, IBM UK & Ireland
Bharat Bhushan, CTO, Banking and Financial Services, IBM UK & Ireland

The pandemic has reshaped our expectations of normality forever. Adapting to new patterns and ways of living and working has led to some of the biggest societal changes in recent history. One such change is our indisputable reliance on digital connectivity and infrastructure for all aspects of our lives – at home and work.

Relative to some sectors, the pandemic accelerated digital transformation programmes and meaningful delivery at banks; several months’ worth of work was completed in weeks and days. Customers responded positively and adopted these new services, albeit in some instances there was no other choice as physical branches were shut and call centres had long wait times. The following three factors will play a key role in the upward trend shaping the further development of digital services:

First, increased digital awareness and comfort amongst customers. Millions of customers of all demographics downloaded their bank’s mobile app for the first time during the pandemic, used it and did not delete it. They overcame a big hurdle and enjoyed the convenience and speed of solving simple enquiries. Analogue ways of working are going to be just too slow for customers for most of their interactions with banks.

Second, the existential necessity of delivering operational excellence. Banks will need to continue to optimise and streamline people, processes, places and technologies, and focus all resources on core services and concrete objectives and outcomes. Until interest rates and revenues start to rise again, banks will continue to automate and redesign processes.

And finally, regulatory and compliance requirements will continue to rise across the board. The complexity and cost of compliance can be much higher if the organisation hasn’t been investing in its digital capabilities that allow internal and external applications and systems to provision access and interact with each other quickly, without lengthy human-to-human interactions.

Rising expectations for personalised experiences

A new UK research survey by YouGov, conducted on behalf of IBM, revealed that younger generations want personalised services and help to manage their money. 61% of people aged between 18 and 24 said they wanted their banks to offer tailored support for their finances; and 54% approved of banks using artificial intelligence (AI) to achieve that goal.

The push for open finance could facilitate these demands using application programming interfaces (APIs)—the connections that enable applications and systems interaction to build new offerings. These APIs allow developers to create new applications that use capabilities from a much broader ecosystem of service providers, enabling banks to innovate with more agility and speed.

A six-point plan for success

As banks mature in their digital and organisational capabilities, the following plan can help them transition into a technology-enabled platform business:

  • Transformational journey of this scale and magnitude requires new sets of hard and soft skills. Make attracting, developing, and retaining talent a top priority.
  • Centre everything around customers. Use data to understand them and create relevant offerings, experiences, and interactions. For the selected segment, ask how essential banking services can be simplified, automated, embedded and even made invisible. Start with a smaller number of use cases and learn from them.
  • Adjust internal metrics to measure what matters in operating a technology platform business. For example, trends in the number of defects per X lines of code, developer productivity improvements, the speed of provisioning environments, or releases and digital customer interactions.
  • Explore forming commercial relationships with external partners that are willing to share investments and rewards.
  • Technology and Architecture. This presents the biggest risk and opportunity for banks as systems get more complex and interconnected. Using emerging and exponential technologies can help banks simplify and personalise customer interactions. Working with vendors that have security and controls baked into their offerings can accelerate building end-to-end solutions and services.

An agile, data-driven future

The role of banks is shifting from taking deposits and lending money to providing embedded services.

In response, the financial-services sector can drive fundamental change by adopting an agile digital-platform model, rich with opportunities for interactions to generate user data that can be used to personalise services, add value for customers and, as a result, find new sources of revenue.

Super exciting! These two words sum it up nicely.

Part 4 Place your bets on this behemoth battle

It is easy to place your bets as all three companies are publicly traded. Square is part of the Fintech 50 Index. Facebook and Twitter are big media businesses.

Bias disclosure. While I have no commercial stake at time of writing I do have two biases.

1. Daily Fintech is a media business writing about Fintech and building Fintech spin off ventures;  so Jack Dorsey running both a media and a Fintech business seems quite normal to me.

2. If I was given a choice of hanging out with Jack Dorsey or Mark Zuckerberg, I would choose Dorsey (although I have never met either).

There  are two major players in Finance:

1. Bitcoin, a decentralized, permissionless network/currency.

2. Cenralised Banks and the Governments who license/regulate the Banks.

Facebook is trying something hard – to compete with Banks while pleasing the Governments who license/regulate them.

The Twitter/Square strategy is simpler and more radical, betting on a decentralized, permissionless network that Banks and Governments would love to stop if they could.

Facebook is doing a delicate dance with regulators. This delicate dance takes a looong time, thus over 2 years since Facebook announced Libra and we have nada, but it will work in the end. Governments/regulators know how to work with a centralized business where you can negotiate with a CEO; a decentralized, permissionless network with no CEO is a scary alternative.

Placing your bets is really a bet on the centralised history/current reality versus the decentralised future.

My bet is on the decentralised future for three reasons:

1. All. centralised. systems. are. hacked. All of them, including Twitter in July 2020, and even the best managed banks. This is a massive risk.

2. Cannot do evil (programmed into decentralised networks) is better than “we promise to do no evil” by managers of centralised businesses.

3. The Internet is decentralised, even with huge centralised businesses making the big money today.

Some subjects are too complex for our short attention spans, so we do 4 posts one week, each one short enough not to lose your attention but in aggregate doing justice to the complexity of the subject. Stay tuned by subscribing.

Part 1

Part 2

Part 3

Part 4

Daily Fintech’s original insight is made available to you for US$143 a year (which equates to $2.75 per week). $2.75 buys you a coffee (maybe), or the cost of a week’s subscription to the global Fintech blog – caffeine for the mind that could be worth $ millions.

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