Australian superapp Bano has selected Currencycloud to facilitate low FX rates.
Integrating Currencycloud’s API offers Bano users access to Currencycloud’s low FX rates, which makes investing in the U.S. stock market more accessible for Bano users.
“Bano is committed to simplifying financial management for Australia’s GenZ and Millennials,” said Bano Head of Financial Markets and Treasury Randall Maccan.
Visa-owned Currencycloudannounced this week it has been selected by Australia-based superapp Bano. Bano will leverage Currencycloud’s FX Converter to facilitate remittances for its Millennial and Gen Z users.
Bano is a digital banking app regulated by ASIC and AUSTRAC. The startup, which is is accessible in over 180 countries, offers physical and virtual Visa debit cards with features such as bill-splitting, fund requests, FX conversions, cashback, rewards, and multi-currency accounts.
Integrating Currencycloud’s API offers Bano users access to Currencycloud’s low FX rates and low AUD to USD conversion rates. This low conversion rate will make investing in the U.S. stock market more accessible for Bano users.
“Bano is committed to simplifying financial management for Australia’s GenZ and Millennials,” said Bano Head of Financial Markets and Treasury Randall Maccan. “Enlarging the breadth of our superapp services with products like the FX Converter is a key part of this mission. Our partnership with Currencycloud has meant we can create a product that will provide a much-needed service for our customers, especially international students in Australia.”
Founded in 2012, Currencycloud facilitates cross-border, multi-currency transactions. The London-based company has processed more than $100 billion to over 180 countries for bank and fintech clients including Starling Bank, Revolut, Penta, and Lunar.
In July of last year, Visa snapped up Currencycloud in a deal that valued the company at $963 million. Last October, the company partnered with Plaid, embedding Plaid’s Payment Initiation Services into its own solution to allow customers to fund their accounts without ever leaving the platform.
Digital financing platform Funding Societies agreed to acquire payments solutions company CardUp.
The announcement comes four months after Funding Societies closed a $294 million Series C investment.
Financial terms of the deal were not disclosed.
Digital financing platform Funding Societies has agreed to acquire payments solutions company CardUp for an undisclosed amount. The news comes four months after Funding Societies raised $294 million in Series C funding.
Singapore-based Funding Societies will leverage CardUp’s payments products to complement its own lending capabilities. The new tools will empower its SME clients to manage and pay expenses, receive payments, and borrow funds.
CardUp, which is also headquartered in Singapore, offers payment capabilities, such as card payments to non-card accepting recipients, online payments acceptance, invoice automation tools, and licenses and integrations with third-party software to help businesses make and collect payments. The no-code solutions make it easy for companies to improve cash flow management, unlock rewards on existing credit cards, and automate tasks. Since it launched in 2016, CardUp has served “tens of thousands” of business clients ranging from micro businesses to corporates.
CardUp will continue to operate its consumer and business services. The company’s employees across Asia will transition over to the Funding Societies team and CardUp CEO Nicki Ramsay will join Funding Societies’ management team to lead its payments business.
Funding Societies, which is licensed and registered in Singapore, Indonesia, Thailand, Malaysia, and operates in Vietnam, connects small businesses with financing while offering alternative investment opportunities for individual investors. The company offers a range of financing products, including micro loans, term loans, invoice financing, supply chain financing, revolving credit, and more. In 2021, Funding Societies connected small businesses with $1 billion in working capital. Funding Societies also supports businesses with a credit card that offers 5% cashback.
“Acquiring CardUp enables us to leapfrog and accelerate our market leadership in the regional fintech space, integrating payments capabilities, enhanced user experience, and local licenses to our digital lending experience across key markets,” said Funding Societies Co-founder and CEO Kelvin Teo. “We are excited to work with the CardUp team and are honored to join forces with them.”
Atomic and Bond Financial have partnered to launch Atomic’s Repay solution.
The new offering enables users to turn large transactions into a series of smaller, recurring payments.
Atomic made its Finovate debut at FinovateFall in September 2021.
Payroll connectivity solution provider Atomic and embedded finance company Bond Financial Technologies have expanded their existing partnership with the launch of Atomic’s Repay solution. Repay enables customers to make recurring payments, turning larger transactions such as monthly rent and loans into a series of smaller installments. Repayments come from the customer’s wages instead of from their bank account. This helps customers avoid the expense of taking out short-term loans or missing repayment dates.
Atomic will use Bond’s embedded finance infrastructure to create and open user bank accounts, as well as manage KYC, transaction monitoring, and compliance. When new users sign up for the service, Repay connects the payroll data while Bond opens a demand deposit account. From here, fractional deposit amounts are calculated, which are managed based on the due date, and Repay automatically makes timely payments.
Users have complete transparency into the process. All deposits and distributions are monitored by the technology and any overpayment is refunded to the user “usually in under a week.”
“Repay gives consumers the tools to take control of their personal finances, both income and liabilities, and for customers to proactively tailor products to their user’s financial profile with payroll data,” Atomic co-founder and CEO Jordan Wright said. He underscored the fact that Repay provides “financial vulnerable consumers” with the functional equivalent of a “fractional repayment plan.” Wright added that businesses that offer Repay “now have a novel option to build goodwill with consumers by offering better interest rates while minimizing default and late repayment risks.”
A leading provider of payroll APIs, and a partner to 12 of the largest fintech firms – including neobanks, alternative lenders, and digital brokers, Atomic made its Finovate debut last year at FinovateFall. At the event, the company demonstrated how its payroll connectivity solution accelerates paydays for consumers, increases direct deposit acquisition opportunities for banks and financial institutions, and helps qualify users for financial services that rely on income and/or employment data.
As Pride Month draws to a close, we wanted to take a look at the impact that banks and other financial services companies have on LGBTQ+ communities.
The issues that face LGBTQ+ communities when it comes to financial services are as varied as these communities themselves are. They range from simply allowing cardholders to determine how they will be identified on their own bank cards, to healthcare-related savings and investment planning, to learning which financial institutions respect LGBTQ+ individuals and their values – as well as those institutions who work against them.
We caught up with Chris Luton, Director of Customer Care with Oakland, California-based Beneficial State Bank, to talk about the relationship between banks – especially community banks – and LGBTQ+ communities. We also discuss Beneficial State Bank’s efforts in this regard – as a “values-based bank” – as well as the bank’s own development as a community financial institution in the age of digitization.
Chris Luton: Beneficial State Bank is a for-profit, mission-driven bank whose owners are institutions governed in the public interest. Instead of working to maximize shareholder profits, we work to maximize prosperity for our communities and our clients, while maintaining strong business performance and serving as a model for ethical banking.
The bank was founded to serve a triple bottom line of environmental sustainability, social equity, and prosperity. The intention was to prove that this banking model could be sustainable, and influence the banking system to substantially change its practices.
All of these qualities differentiate us from most banks. For instance, we invest in and work with community organizations that are often turned away by traditional banks. We offer socially-conscious individuals, small businesses, and nonprofits the unique opportunity to put their money toward causes they believe in.
Luton: This means prioritizing our values just as much as our profits, which is captured in our triple bottom line of environmental sustainability, social equity, and prosperity.
In practice, this means that our values guide our investment decisions. All of Beneficial State Bank’s investments are mission-aligned, and we aim for at least 75% of that lending to go toward the highest-impact organizations and initiatives. We then work to ensure that the rest never goes toward projects or organizations that cause harm.
For example, we invest in environmental sustainability, affordable housing, social justice, and health and well-being. Meanwhile, we never invest in fossil fuels, payday lenders, private prisons, or weapons manufacturers.
Luton: Right now, some of the nation’s biggest banks fund anti-LGBTQIA+ policies through political donations. If the millions put toward these discriminatory policies were instead invested in organizations that protect and uplift the LGBTQIA+ community, banks could make huge progress in a more positive direction. For better or worse, money is hugely influential, especially in our political process. Banks could better serve the LGBTQIA+ community by leveraging this power for good.
Banks should also consider how their policies and practices impact their LGBTQIA+ customers and employees. At Beneficial State Bank, we strive to create a welcoming and inclusive customer experience — for example, we make it as easy as we can for clients to change their name and gender on any official communications.
Ultimately, it’s important that banks try to see the big picture on this issue by looking beyond performative celebrations during Pride Month. Members and allies of the LGBTQIA+ community are looking for more than just a rainbow logo or special blog post, and the community’s needs don’t suddenly end once Pride month is over. Support for the LGBTQIA+ community should last all year long. Companies should also look at their overall impact to see if it’s consistent with their messaging. For instance, they might claim to support the LGBTQIA+ community while funding discriminatory politicians or having discriminatory internal policies.
Luton: It starts with building a welcoming and inclusive environment where employees feel safe and empowered to be themselves. We make an effort to hold space for connection among our LGBTQIA+ employees and their allies, and host Pride celebrations every year. Benefits and policies should also be inclusive. For instance, we make sure employees can add domestic partners and their children to their insurance plans, regardless of marital status.
Luton: The first step is transparency. Consumers can’t make better banking choices if they don’t know where their money is going. Unfortunately, a lot of banks aren’t transparent about where their money goes. Banks need to be honest about their investments so consumers can learn, engage, and make banking choices that are more aligned with their values.
Values-based institutions like Beneficial State Bank are upfront about our investments. For example, our goal is always for at least 75% of our commercial loan dollars to go to mission-aligned businesses – i.e., those working on issues like affordable housing or renewable energy. We also never lend in non-mission-aligned sectors, such as fossil fuel extraction, private prisons, or weapons manufacturing.
Mighty Deposits is a great resource for discovering how your bank is using your money, and what better options might be out there. Beyond the banking sector, Data for Progress has also released the latest version of its Pride Corporate Accountability Project, which looks at how many Pride sponsors and Fortune 500 companies are funding anti-LGBTQ+ campaigns.
Luton: A big milestone in our own digital transformation was the PPP lending process in 2020. We did a substantial amount of lending that required all hands on deck. This actually gave us confidence in bringing up a new platform quickly and effectively. Since then, we’ve improved our digital and online functions, increased efficiency and speed, and lowered our cost of delivery.
The bank also recently closed on an equity investment of $218 million from the U.S. Treasury’s Emergency Capital Investment Program (ECIP), which will support expanded lending to small businesses, and low- and moderate-income consumers. Our first priority is investing in the bank’s capacity so we can better serve our customers. This will include technological capacities like automation and infrastructure.
Luton: With this recent investment from the U.S. Treasury, we see the next few years as a time of growth and an opportunity to demonstrate the power of values-based banking. We see ourselves continuing our work with marginalized customers and communities on a larger scale, expanding our investments in people and organizations making positive change in the world, and influencing other banks to do the same.
Our ultimate vision is an economy that restores our planet and extends prosperity to all people. We can achieve this vision if more banks decide that doing good and doing well are not mutually exclusive.
Roostify announced a partnership with Indecomm that will integrate Indecomm’s IncomeGenius technology into Roostify’s Roostify Beyond platform.
The integration will make it easier for Roostify to calculate income for self-employed borrowers.
A Finovate alum since 2014, Roostify also announced this week the appointment of Nadia Aziz as its new Chief Operating Officer.
A new partnership with intelligent automation solutions company Indecomm will bring automated income calculation technology to Roostify’s data intelligence solution Roostify Beyond. A Finovate alum since its debut at FinovateSpring 2014, Roostify will integrate Indecomm’s IncomeGenius solution, which will add to its current income calculation capabilities – especially when it comes to income calculations for self-employed borrowers.
“Improving loan assembly and processing costs, and timeframes is an imperative for all lenders in today’s environment,” Roostify co-founder and CEO Rajesh Bhat said. “Roostify Beyond already incorporates income calculation and analysis for the most common employment scenarios. With the integration of IncomeGenius, we can now simplify and automate calculations for self-employed borrowers, an increasingly important use case as the gig economy expands.”
IncomeGenius leverages standardized rules and algorithms to minimize the risks associated with manual data entry. IncomeGenius doubles productivity at loan set-up, reduces time spent on income calculations by 60%, and guarantees 100% compliance with audit requirements, including a complete audit trail. Courtesy of the integration, Roostify Beyond’s Analysis Assistant will send self-employment documentation and data to IncomeGenius, which generates a thorough, self-employment income analysis and GSE worksheet – in accordance with Fannie Mae and Freddie Mac guidelines. IncomeGenius then returns the information to the Roostify Beyond platform for presentation in the interactive Analysis Assistant dashboard.
Roostify launched its Beyond platform near the end of 2021. The latest iteration of the company’s Roostify Document Intelligence (RDI) Service, Roostify Beyond integrates RDI at the start of the lending process, providing borrowers with instant alerts if they upload documentation that is incorrect or illegible without having to engage with a human representative. Roostify Beyond also has data extraction capabilities that allow lenders to highlight data discrepancies, automatically create tasks, and publish document classification and validated information to the loan origination system (LOS).
“When we launched RDI a couple of months ago, we were excited to use data to propel the industry forward,” Bhat said in December when Roostify Beyond was introduced. “Data empowers lenders to spend less time in systems and more time with customers, and we are truly happy to provide our customers with this experience.”
Founded in 2012, Roostify most recently demonstrated its technology on the Finovate stage in 2018. In the years since, the company has grown into a mortgagetech leader that helps lenders process more than $50 billion in loans each month. The San Francisco, California-based company counts more than 250 financial institutions as clients and has 150+ employees.
This week Roostify introduced its new Chief Operating Officer, Nadia Aziz. With a focus on home lending, Aziz brings more than 20 years of financial services and fintech experience to Roostify’s C-suite. Before joining Roostify, Aziz was General Manager of Opendoor Home Loans, a digital lending platform for residential real estate.
“Roostify’s goal is to provide lenders with the tools and capabilities they need to deliver an exceptional experience for their customers while ensuring they achieve their business objectives by digitizing the loan origination process,” Aziz said in a statement. “I am excited to help Roostify on this mission and expand our impact on the industry by transforming the home lending journey.”
FIS is launching its Guaranteed Payments solution this week that boosts merchants’ ecommerce transaction approval rates and guarantees protection against chargebacks.
FIS is partnering with ecommerce fraud prevention company Signifyd to reduce merchant chargebacks.
“With this solution, customer retention works hand in hand with fraud elimination to unlock incredible revenue growth opportunities,” said Signifyd CEO and Co-founder Raj Ramanand.
Core banking expert FIS is launching a Guaranteed Payments solution this week. The new tool guarantees merchants increased ecommerce transaction approval rates and eliminates the financial liability of chargebacks resulting from fraudulent purchases.
Guaranteed Payments, which is available across the Signifyd Commerce Network and integrated into FIS’ Worldpay platform, facilitates increased merchant approval rates and provides guaranteed chargeback protection. The new technology combines machine learning and transaction intelligence to analyze aspects of a consumer’s purchase, including email address and payment credentials. Leveraging that information, Guaranteed Payments can instantly distinguish legitimate orders from fraudulent orders. The reduced fraud helps merchants optimize revenue and fulfill orders more quickly.
“Guaranteed Payments brings together two powerful sources of transaction intelligence—the Worldpay data stream produced from processing 40 billion orders annually and the Signifyd Commerce Network of thousands of merchants worldwide,” said FIS Chief Product Officer Vicky Bindra. She adds that the new tool can “combine fraud protection with increased approvals to enhance payment optimization and the overall user experience.”
Preventing chargebacks is at the heart of Signifyd’s technology. The California-based company helps identify fraudulent product orders using machine learning algorithms that sift through big data, including user behavior patterns, to reduce merchant chargebacks on fraudulent charges and save money on shipping goods on declined orders. In the event an order turns out to be fraudulent, Signifyd reimburses the merchant for the chargeback.
“Merchants using Signifyd experience a 5 to 9 percent increase in top line conversion on average,” said Signifyd CEO and Co-founder Raj Ramanand. “With this solution, customer retention works hand in hand with fraud elimination to unlock incredible revenue growth opportunities.”
FIS’ Guaranteed Payments is launching at a time when ecommerce activity and the fraud the comes along with it are at an all-time high. While the ecommerce market is predicted to grow 50% in the next two years, so is the fraud that comes along with it. In the past year, nine out of 10 merchants lost revenue due to payment fraud. False positives are hurting merchants, as well. Even though fraud currently accounts for about 1% of online transactions, merchants routinely reject as much as 9% of orders to avoid fraud, missing out on $443 billion in potential revenue.
PayPal launched a small business credit card this week.
The PayPal Business Cashback Mastercard is PayPal’s first business credit card.
PayPal also offers a range of other tools for small businesses, including working capital tools, business loans, risk management support, and more.
Small businesses in the U.S. have gained yet another credit card option this week with PayPal’slaunch of its its first commercial credit card.
The PayPal Business Cashback Mastercard, which is issued by WebBank, has no annual fee and offers cardholders 2% cashback on all purchases. The rewards are not subject to earning caps nor do they expire. Additionally, the card comes with free employee cards, does not charge a foreign transaction fee, and integrates with PayPal’s merchant platform to facilitate access to transactions, balances, available credit, and rewards.
Once a business is approved for the card, it can immediately begin spending via a virtual card that is automatically integrated into their PayPal account. Businesses can view their account and spending details via their PayPal Business account.
“As small business owners continue to recover from the challenges of the past two years, having multiple financing options to address their capital needs is more important than ever,” said PayPal Vice President of Global Merchant Lending Bernardo Martinez. “The PayPal Business Cashback Mastercard provides merchants greater value, more choice, and the increased flexibility they need to manage their business finances, offering among the best value available on no annual fee business credit cards today. This new solution continues PayPal’s commitment to supporting small businesses and offering options to help manage the day-to-day costs of operating their business.”
Founded in 1998, PayPal has long been an ally to small businesses. In addition to the business credit card, the California-based company also offers a working capital solution that has distributed more than $20 billion, as well as payout capabilities, business loans, payment acceptance tools, risk management support, and more. These products have helped PayPal amass 20 million small business customers in the U.S. And this is no small feat, given the fact that there are only 33 million small businesses in the U.S.
The launch of the The PayPal Business Cashback Mastercard comes five years after PayPal launched its credit card for individual users in 2017.
Further, a company that helps democratize investing in VC funds, is launching this week.
The London-based company enables users to invest as little as £1,000 in startups that are not publicly available.
The company allows anyone to invest, as long as they agree not to invest more than 10% of their net assets in shares, bonds, or funds that are not listed or sold on a stock exchange.
London-based Further is launching this week to help democratize investing in VC funds. The company enables users to invest in startups that are not publicly available.
The company’s platform enables users to browse, review, and compare funds, and easily invest as little as £1,000. Once the investment is made, Further enlists U.K. fund managers to invest users’ money into startups that are not generally available to everyday investors. Investors receive returns after around five to 10 years when the startup they invest in exits via sale or IPO.
Accessibility is Further’s differentiating factor. The company allows anyone to invest, as long as they agree not to invest more than 10% of their net assets in shares, bonds, or funds that are not listed or sold on a stock exchange.
That limit is in place for good reason– there is significant risk associated with VC investments. However, while many funds fail, others are quite successful. According to Pitchbook, European VC has delivered an internal rate of return of 14% across a 10-year timespan.
At a time when the public markets are in bear territory, Further’s launch comes at an ideal time. “I’d much prefer to be investing in a fund now and getting the valuations VCs are getting now [rather than last year’s],” Further CEO and cofounder Rob Tominey told Sifted. “The early returns will be strong.”
Further makes money in a couple of different ways. The company charges the funds a marketing fee and also charges investors a small percentage. Consumers also face fees from the funds themselves; each fund they invest in charges fees for onboarding and fund management services. Further argues, however, that the tax benefits users receive help to balance out the expense of the fees. “In addition, the company’s website states, “you can receive tax reliefs alongside each fund’s expert knowledge and management. These tax reliefs typically exceed the lifetime fees charged by funds, although this is not guaranteed.”
Mobile fraud prevention specialist Incognia, which made its Finovate debut in May at FinovateSpring, has raised $15.5 million in Series A funding.
The capital will be used to help fuel the company’s growth; Incognia currently has 200 million mobile users in more than 20 countries worldwide.
Incognia leverages location and motion sensors to create a unique “location footprint” for trusted users that rivals other authentication methods in accuracy.
In a round led by Point72 Ventures, mobile identity company Incogniahas secured $15.5 million in Series A funding to help fight identity fraud. The investment will help fuel the Palo Alto, California-based company’s continued growth, building on the 200 million mobile users in more than 20 countries currently protected by Incognia’s technology.
“Today’s authentication and fraud detection solutions aren’t working for the user, or for businesses, and the market is looking for more innovative technologies,” Incognia founder and CEO André Ferraz said. “Incognia is pushing the frontier of identity assurance and authentication to deliver increased security with minimal user friction.”
Incognia leverages location signals and motion sensors on an individual’s mobile device to help combat identity fraud. The technology creates a privacy-first location identity that is unique to each user and acts like a “location fingerprint” that effectively differentiates trusted users from fraudulent ones. The company says that its solution, which can be deployed in industries ranging from fintech and crypto to gaming and social media, is 10x more accurate than FaceID in terms of uniquely identifying users. Further, Incognia notes that the technology has a false acceptance rate of less than 1 in 17 million.
“We’re emerging as the global location identity leader, effectively combating the increasing fraud on mobile around the world,” Ferraz added. “We’re dedicated to enabling our customers to deliver frictionless mobile experiences without compromising security and privacy.”
Incognia made its Finovate debut at FinovateSpring 2022 in May. At the conference, the company demonstrated how its frictionless fraud prevention solution for mobile apps combats identity fraud without bringing additional friction to the authentication process. The technology’s zero-factor authentication requires no action from the user in order to provide a highly accurate risk assessment with low false acceptance rates.
Founded in 2020, Incognia also recently introduced its new location-based liveness spoofing detection solution module. The offering prevents biometric liveness spoofing during the onboarding process. This particular form of fraud is often used by cybercriminals to create “money mule” accounts for money laundering – as innovative fraudsters have turned to liveness spoofing to get around selfie-based liveness detection algorithms. The challenge of liveness spoofing has become even greater with the availability of cheap – or even free – deepfake video technology. Incognia’s location-based liveness spoofing detection module is designed to prevent these deepfake attacks in real-time.
“As fraudsters advance their techniques to trick liveness detection tools, it is critical that there is a solution on the market that can successfully combat the use of deepfakes at onboarding,” Ferraz said.
Courtesy of the API-enabled integration with Lokyata, Infinity Solutions will give its customers the ability to access key loan decision information. This includes customer-permissioned bank statement analysis such as average monthly net income, minimum balance, average monthly loan payments, and insufficient funds (NSF) notification histories. The integration will also enable lenders to configure both auto-fund and auto-deny rules to bring additional streamlining to the loan decisioning experience.
“At Lokyata, we are always looking to work with innovators in the market and Infinity Software is demonstrating the value of scalable, modern technology in an evolving lending ecosystem,” Lokyata CTO Steve Bireley said. “Increasingly, lenders are looking for ways to responsibly help more consumers gain access to credit, and through tools like BankAnalyze and Infinity Software’s platform, more lenders are successfully meeting that goal.”
With 20 years of experience providing lending solutions and other tools to direct-to-consumer lenders, Infinity Software has helped more than 700 businesses enhance their lending processes. The company uses a configurable loan product engine that gives lenders access to advanced accounting and reporting, as well as a built-in collections suite and access controls. Infinity Software offers a wide range of services to lenders, ranging from website design to optimized loan agreements to automated underwriting waterfalls, as well as a number of additional consumer loan solutions.
“Infinity has worked with hundreds of vendors to meet the needs of lenders in our space,” Infinity Software Director of Products Shannon Lee said. “Lokyata has proven to have a unique product that helps lenders better meet the needs of underserved borrowers and grow their business in a responsible and innovative way.”
Currently headquartered in Washington, D.C., Lokyata made its Finovate debut last month at FinovateSpring 2022. At the conference, Lokyata’s Bireley demoed the company’s BankAnalyze solution. The technology assesses the bank statements from a loan applicant and then provides an automated credit decision recommendation based on a combination of a weighted rules and a Lokyata score created in collaboration with the client. The company believes that using borrower-permissioned data is a major boon to the lending process, creating a more accurate, and up-to-date depiction of the borrower’s credit status. Moreover, Lokyata says that this approach “primes” near and subprime borrowers by making it easier for financial institutions to lend to “near prime” borrowers without taking on excessive risk.
Lokyata’s other products include ExcelRate, a lending and lead decision platform, and FraudBlock, a real-time identity verification and fraud intelligence solution for financial transactions. With $1.5 million in funding, Lokyata has scored more than 6.1 million loans impacting more than 240,000 customers. Founded in 2017, the company has raised $1.5 million in funding. Santosh Thiruthi is co-founder and CEO.
Digital banking startup Kroo received a full banking license from the Bank of England.
Kroo will use the new authorization to offer personal current accounts in the coming months.
The full banking license places Kroo in competition with Monzo, Starling Bank, and Atom Bank.
Digital banking startup Kroo just received a full banking license from the Bank of England. With the new authorization, the U.K.-based bank plans to offer personal current accounts (checking accounts).
Founded in 2016, Kroo offers a prepaid Mastercard with a tandem mobile app that provides spending insights, peer-to-peer money transfers, bill-splitting capabilities, and more. The payment card, which is biodegradable, works in more than 75 countries.
Kroo will add current accounts to its product line “in the coming months.” After launch, the company will offer its 23,000 customers the option to migrate to the new offering for free.
Kroo CEO Andrea De Gottardo said that the banking license represents a “phenomenal milestone” for the company, which has a mission to create a bank that connects people financially. “The bar to be granted a U.K. banking license is exceptionally high, and I am incredibly proud of the team and our work in achieving this,” De Gottardo added.
Having a full banking license helps Kroo differentiate itself from the massive number of competitors in the digital banking space, since the accreditation enables the bank to protect customers’ deposits of up to £85,000 via the Financial Services Compensation Scheme. Along with this, the license allows Kroo to offer a wider range of products, including loans and savings.
Kroo is only the second bank to earn a full banking license with a personal account since 2016. Having the full license places Kroo in competition with major digital banks, including Monzo, Starling Bank, and Atom Bank. Other European-based digital banks Revolut, Klarna, and Wise, have yet to receive their full banking licenses.
Today’s news comes weeks after Kroo closed on a $30 million (£26 million) Series B funding round. The investment brought Kroo’s total funding to $71.5 million.
Two Finovate alums – Alkami Technology and Array – have teamed up to help financial institutions offer credit and identity solutions to their customers.
The partnership makes three of Array’s signature solutions: My Credit Manager, ID Protect, and Offers Engine, available to a wider range of bank and credit union customers and members.
Alkami made its Finovate debut in 2009 as iThryv. Array won Best of Show at FinovateFall 2021 and again at FinovateSpring 2022.
A new partnership has been forged between digital banking solution provider Alkami Technology and financial enablement platform Array. The collaboration will bring a range of new solutions to Alkami clients that will help their customers and members better monitor their credit, benefit from anti-fraud identity monitoring, and access actionable, credit-based offers.
“Improving the digital-first banking experience is a top priority for banks and credit unions,” Alkami founder, Chief Strategy Officer, and Product Officer Stephen Bohanon said. “Our partnership with Array enables banks and credit unions to provide added-value products to account holders, which increases engagement and potentially revenue as well.”
Among the solutions that will be made available to Alkami’s bank and credit union partners are Array’s My Credit Manager, ID Protect, and Offers Engine. My Credit Manager keeps users updated on changes to their credit score, enables them to explore different credit scenarios with a credit score simulator, allows them to conduct debt analysis, as well as see how different factors impact their credit score. With ID Protect, users can take advantage of a number of anti-fraud protections including identity and Dark Web monitoring, alerts, insurance, and restoration services in the event of identity theft. Array’s Offers Engine empowers banks and credit unions to better market their products and services to customers and members using targeted, actionable offers that are based on the individual’s actual credit circumstances.
“Today’s success formula for personal service includes a mix of in-branch experiences and digital tools that add value to account holders every time they log in,” Array co-founder and CEO Martin Toha explained. “Alkami and Array are making it easier than ever to help banks and credit unions deploy a consistent roadmap of innovative digital products for account holders.”
A Finovate alum since 2009, when it debuted at FinovateSpring as “iThryv,” Alkami has grown into a leading digital banking solution provider. The Plano, Texas-based fintech serves both retail and business customers with onboarding, engagement, and account servicing. Clients can enhance their use of the Alkami platform with upgrades and leverage both Alkami’s product suite, as well as integrated, third-party solutions to enhance and customize their experience. Alkami is a publicly-traded company on the NASDAQ under the ticker “ALKT,” and has a market capitalization of $1.3 billion.
Winning Best of Show honors in its Finovate debut at FinovateFall last September and again in its return to the Finovate stage last month for FinovateSpring, Array is a financial enablement platform that specializes in embeddable and white label solutions. Founded in 2020, the company enables its clients to boost end customer engagement by providing them with innovative credit and identity solutions that enhance the customer experience.
Array raised an undisclosed amount of funding in June 2021 from Operator Partners and the FIS FinTech Accelerator in Partnership with The Venture Center. The company is based in New York City.
Raisin Bank has agreed to acquire the payment division of Bankhaus August Lenz.
The move will help Raisin Bank diversify its revenue sources by adding payment services to its product lineup.
Terms of the deal were not disclosed.
Banking-as-a-service player Raisin Bank is adding cash and payment services to its product lineup. This comes as the Germany-based firm has acquired the payment division of Bankhaus August Lenz, a private bank headquartered in Munich. Financial terms of the agreement were not disclosed.
The move will help Raisin Bank diversify its revenue sources by adding payment services. The new capabilities enable Raisin Bank to offer customers electronic payment transactions and cash solutions. Bankhaus August Lenz’s Mirko Siepmann will head up the new division, which aims to help retailers, restaurant, gas stations, and non-bank operators of ATMs, facilitate the operation of more than 4,500 ATMs in Germany.
“As a service bank, we will act much more independently and powerfully with the expansion of our payment solutions and continue our growth in the banking-as-a-service market throughout Europe advance,” said Raisin Bank Chief Commercial Officer Dr. Andreas Wolf. “With the new business area, we can position ourselves even better as a provider for bulk payments.”
Raisin Bank, previously MHB-Bank, was founded in 1973. The bank acquired European fintech Raisin in 2019 and has since been working toward its goal to become the leading banking-as-a-service provider in Europe. The bank offers digital solutions to help startups, institutional investors, and financial service providers seeking banking licenses to enhance customer and account management, payment transactions, and lending. Raisin Bank stated in today’s press release that adding payment services represents an “important strategic step on the way to becoming a powerful full-service provider.”
This week’s edition of Finovate Global takes a look at two Finovate alums that are helping support fintech innovation in the Middle East and Africa.
First up is engagement banking platform provider Backbase. The four-time Finovate Best of Show award-winning company announced this week that it has forged a new partnership with Bahrain FinTech Bay (BFB). The partnership comes under the auspices of BFB’s Venture Acceleration Platform, which seeks to boost the adoption of digital banking technology in the MENA region.
Head of Partners at Backbase Middle East Mehmet Cakal said, “This new collaboration with Bahrain FinTech Bay aligns with our continuous efforts to help banks in the region with a long-term digital strategy and support them with a holistic approach towards digital transformation, to be able to meet the demands and expectations of their customers in today’s age.”
Backbase is no stranger to the MENA fintech and financial services industry. The company, founded in 2003 and headquartered in Amsterdam, the Netherlands, has established partnerships with a number of key players in the region. This includes the National Bank of Bahrain, Banque Saudi Fransi, and the Kuwait International Bank. In fact, Backbase Middle East was awarded “Digital Banking Provider Of the Year” honors at the MEA Finance Banking Technology Summit and Awards last month.
Bahrain FinTech Bay, a leading finech hub in the region, promotes fintech innovation by incubating fintech initiatives via innovation labs, acceleration programs, curated activities, and educational opportunities. Founded in 2017, BFB launched its Venture Acceleration Platform in order to give emerging fintechs “a launch pad and bespoke go-to-market strategies” to help them scale their businesses and take advantage of opportunities in the MENA region. The platform provides those companies selected to participate in the accelerator with market intelligence, exposure to partners, as well as assistance in implementation and regional expansion.
“Our new partnership with Backbase will strengthen our mandate to bring cutting-edge technology offerings to banks and financial institutions in MENA,” Bahrain FinTech Bay CEO Bader Sater said. “Bahrain FinTech Bay is committed to providing curated opportunities for enterprises and supporting startups in the sector to accelerate their growth and expansion efforts across the region.”
Meanwhile, several hundred miles to the south and west, fellow Europe-based fintech Compass Plus is engaged in its own outreach to markets in developing economies. The U.K.-based company, a Finovate alum since 2012, announced this week that it is teaming up with Nigerian fintech Interswitch to help it enhance its payment processing capability.
Interswitch will leverage Compass Plus’ token-based, cloud-native, API-first open development payments platform, TranzAxis, to process Verve, Visa, and Mastercard credit card transactions. Six African banks already have been onboarded onto the new platform, which has enabled Sterling Bank of Nigeria to launch the country’s first Verve credit card.
“We are delighted to partner with Interswitch, one of the biggest processors in Africa,” Compass Plus MEA VP and Deputy Managing Director Adil Ahmed said. “Interswitch has always strived to drive positive change in the region, and now that they have TranzAxis to support their ambitions, they will continue to revolutionize Africa’s payment space in the region, further strengthen the Verve payments network, and manage their Visa and Mastercard credit card business more efficiently.”
Founded in 1989, Compass Plus offers banks and financial services companies retail banking software and services to enable them to better respond to their customers’ banking needs. The company’s solutions address issues from card, account, and merchant management to card personalization, payment processing, and terminal driving to self-service channel management and both mobile and e-commerce. Compass Plus’ TranzAxis technology helps financial services companies develop and support cards, payments, transaction switching, and other retail banking activities.
Headquartered in Lagos, Nigeria, Interswitch began as a nationally-focused, transaction switching and processing firm. In the 20 years since then, the firm has grown into Africa’s leading integrated payments and digital commerce platform company with more than 900 full-time workers across Africa – 40% of whom are women. Named “Fintech of the Year” at the 2022 African Banker Awards last month, Interswitch also last month secured a strategic investment from LeapFrog Investments and Tana Africa Capital. The amount of the funding was not disclosed.
“The evolution of fintech in Nigeria and the broader sub-Saharan region has been driven by the need to solve challenges and barriers that exist within the traditional financial system,” Interswitch founder and Group Chief Executive Mitchell Elegbe said. “Interswitch was born from the need to develop solutions that match the unique needs of local customers and merchants.”
Here is our look at fintech innovation around the world.
Innovation and regulation are the ying and yang of financial technology in many respects. To this end, we caught up with Justin Beals, co-founder and CEO of Strike Graph, to talk about the relationship between fintech innovation and fintech regulation, and why compliance is something that successful fintechs are taking seriously.
Founded in 2020 and headquartered in Seattle, Washington, Strike Graph specializes in helping companies secure critical security compliance certifications. These are the certifications that can both impact revenue and reduce the time to close, as well as demonstrate the maturity of an organization.
Why banks and financial services companies need a compliance partner.
The challenge (for banks) is that the standards that you’re trying to meet can be complex. It’s important to not only have technology, but (also) a provider of that technology with intelligence about how to meet the standard so that you don’t essentially spin your wheels trying to do things that don’t necessarily make you more secure and don’t necessarily impact compliance.
So when revenue is on the line – and that’s what the challenge is here – being unable to represent a security posture that meets certain standards (means) you might not get that partnership, you might not get that contract … You really need to do it efficiently and effectively and be able to maintain it for a long period of time.
On the role an effective compliance partner can play to help financial services companies
I think one of the secrets about compliance practices is that if there’s some aspect of your business that isn’t applicable to the standard, you’re actually not required to be assessed to it. And so what’s really important is to customize your security posture according to the types of risk that your business is meeting in the marketplace, and then respond to those risks. Then, (you are) able to talk to the assessor and say, “hey, look, you know we don’t necessarily have this particular risk. It’s not something we solve for and therefore it’s not something we need to be assessed for.” That way you get through the compliance process as efficiently as possible.
On Strike Graph’s approach to helping financial services companies meet compliance obligations
The secret sauce at Strike Graph is that we have a very intelligent SaaS platform that helps our customers customize that particular security posture based upon the risks that are impacting their business.
This is impacting any B2B company that’s sharing data. And that’s really how we describe our marketplace. And, of course, fintech handles some of the most precious transactions and pieces of data, and they have a long history of things like PCI DSS where compliance is really important. So they really do understand the value of having a good compliance practice.
Digital customer service firm Glia agreed to acquire conversational AI technology company Finn AI.
Financial terms of the deal were not disclosed.
Glia Co-founder and CEO Dan Michaeli said that Finn AI is a strong fit for Glia because of its technology, market approach, and company culture.
Digital customer service firm Glia is enhancing its offering with its recent acquisition of conversational AI technology company and fellow Finovate alum Finn AI.
Financial terms of the agreement, which will integrate Finn.ai’s conversational AI solutions into Glia’s customer service platform, were not disclosed. Glia Co-founder and CEO Dan Michaeli said that Finn AI is a strong fit for Glia because of its technology, market approach, and company culture.
“This marks a new chapter for Virtual Assistants: Verticalization with Scale,” Michaeli said. “Generic ‘one-size-fits-all’ bot providers have largely failed to meet the full potential of conversational AI, leading to the emergence of vendors focusing on specific industry verticals. Until now, none of the financial services bot vendors have been able to achieve widespread adoption on their own.”
Finn AI Co-founder and CEO Jake Tyler said that joining forces with Glia will offer Finn AI scale. Founded in 2014 and headquartered in Vancouver, B.C., Finn AI aims to transform customer engagement and increase financial literacy with its AI-powered conversational banking technology. Among the company’s clients are ATB Financial, BECU, United Federal Credit Union, EQ Bank, Civista Bank, and Truist Momentum.
According to the press release, Finn AI and Glia have a lot of shared clients, and Finn AI’s technology is already integrated into Glia. Post-acquisition, the company’s leadership team will take on leadership positions within Glia. As for Finn AI’s Canadian headquarters, Glia plans to use the location to establish a “Conversational AI Center of Excellence.”
Glia was founded in 2012 as SaleMove. The company offers digital communication choices, on-screen collaboration, and AI-enabled assistance tools. Glia, which has taken home 10 Finovate Best of Show awards for its live demos, most recently showcased its tools at FinovateSpring 2021. Finn AI also boasts accolades from the Finovate audience, having taken home two Finovate Best of Show awards for its demos at FinovateAsia 2016 and FinovateFall 2017.
E-commerce payments enabler SumUp raised $624 million (€590 million) in a combination of equity and debt financing this week.
The funding round was led by Bain Capital Tech Opportunities.
This week’s investment gives SumUp a valuation of $8.5 billion (€8 billion).
In a round led by Bain Capital Tech Opportunities – and featuring participation from funds managed by BlackRock, btov Partners, Centerbridge, Crestline, Fin Capital, and Sentinel Dome Partners – e-commerce payments innovator SumUp has secured an investment of $624 million (€590 million). The funding gives the London-based company a valuation of $8.5 billion (€8 billion). SumUp co-founder Marc-Alexander Christ said in a statement that the capital will “enable us to continue to build out our product ecosystem, expand into new markets, (and) pursue value-adding acquisitions.”
The funding was a 50/50 mix of debt and equity and includes SumUp’s first equity infusion since 2017. The company’s total funding stands at $1.6 billion – most of which is debt financing. SumUp secured €750 million in debt funding in 2021.
In an interview with the Financial Times, Christ called the company’s new valuation “true and fair”. This statement comes months after it was reported that SumUp was seeking an investment that would give the company a significantly higher valuation – to the tune of $21 billion (€20 billion). Christ suggested that the current valuation reflects “the price people put on the company in the worst of markets” and that SumUp’s valuation was unlikely to move any lower in the future.
SumUp won Best of Show in its Finovate debut at FinovateEurope 2013 in London. In the years since, the company has grown to serve more than four million businesses with its payment solutions that range from card readers and point of sale solutions to business accounts and invoicing. The company began this year teaming up with Worldpay from FIS to support its global expansion efforts. SumUp will use Worldpay’s global acquiring services, including authorization, clearing and settlement, dispute management and data insights.
Also this year, SumUp announced a referral deal with Latin American and European e-commerce platform PrestaShop. The partnership gave “hundreds of thousands” of merchants on the PrestaShop platform access to SumUp’s product suite of payment solutions and business tools. Nearly 300,000 websites rely on PrestaShop’s technology, and the company sees its collaboration with SumUp as part of its strategy to enable more merchants to launch and scale their businesses.
“By partnering with PrestaShop, we will continue to expand our support for digital transformation of small businesses, by ensuring their products and services are also available online for their customers,” SumUp Head of Sales and Partnerships James Henry said. “Our partnership will enable merchants with a seamless and secure payment experience for all major credit and debit cards, an important tool in enabling small business success in today’s environment.”
Founded in 2012, SumUp is headquartered in London. Daniel Klein is founder and CEO.
Buy now, pay later (BNPL) has seen a lot of hype since the popularity of the technology exploded in 2020. The U.K. Financial Conduct Authority (FCA) estimates that the U.K. BNPL market is worth $3.7 billion (£2.7 billion), and that five million British citizens have used BNPL tools since 2020. This growth is great for BNPL companies, but not necessarily so for the consumers they serve.
That’s because consumers in the U.K. are starting to take on debt to pay for purchases they’ve made using BNPL. According to a recent survey, more than 40% of U.K. consumers have done so. Citizens Advice, which conducted the survey, found that 51% of consumers ages 18 to 34 have borrowed money to pay for BNPL purchases, while 39% of 35 to 54 year-olds and 24% of people aged over 55 have done so.
The most common debt incurred to pay for purchases made using BNPL is credit card debt. Users have also borrowed money from friends and family, borrowed money from their bank overdraft, taken out loans, and have even taken out payday loans. The study also found that more than one in 10 customers of a major bank using BNPL services were already behind on their payments.
This misuse of BNPL technology is why the U.K. FCA released a set of four rules earlier this week. The agency anticipates they will protect millions of consumers.
Lenders will be required to carry out checks to ensure that loans are affordable for consumers.
Advertisements must be fair, clear, and not misleading.
Lenders will need to be approved by the FCA.
Borrowers will be be able to take complaints about BNPL schemes to the Financial Ombudsman Service.
The government will create secondary legislation by mid-2023, after which the FCA will consult on its rules for the short-term lending sector.
“Buy-Now Pay-Later can be a helpful way to manage your finances but we need to ensure that people can embrace new products and services with the appropriate protections in place,” said Economic Secretary to the Treasury John Glen. “By holding Buy-Now Pay-Later to the high standards we expect of other loans and forms of credit, we are protecting consumers and fostering the safe growth of this innovative market in the U.K.”
The FCA has made it clear that these regulations do not only apply to BNPL firms. Companies that extend other forms of short-term, interest-free credit will also be required to comply with the same rules. Not only that, the rules also apply to businesses who partner with a third-party lender to provide credit to their customers.
Ecommerce company Shopify has unveiled more than 100 new announcements today.
Among the top new releases are a marketplace that allows fans to use their NFTs to receive personalized benefits and a tool that allows merchants to sell to their audience on Twitter.
The announcements were made as part of Shopify Editions, Shopify’s new, semi-annual showcase of fresh tools and updates for its merchant clients.
Ecommerce player Shopify is debutingShopify Editions, the company’s semi-annual showcase of new tools and capabilities for merchant clients. In today’s announcement, the company is unveiling more than 100 new updates and launches to power what it is calling Connect to Consumer (C2C).
“Welcome to Shopify Editions, where twice a year we show you everything that we’ve been building,” Shopify stated on its website. “We know that brands need new ways to engage with their customers—and that means creating new connections. So this release of Editions features everything you need to win in the new era of commerce: Connect to Consumer.”
Here are some highlights of features Shopify has released so far this year:
Point of Sale, which helps merchants sell to customers where they are, including in-person, online, and anywhere else.
Hydrogen and Oxygen, which helps any size of merchant start, build, and deploy custom storefronts.
B2B on Shopify, an offering that enables Shopify Plus merchants to sell to other businesses on the same platform that they use for selling direct-to-consumer.
Shopify Markets, which makes it easy for merchants to engage with and sell to buyers in international markets.
Tokengated Commerce, a marketplace that allows fans to use their NFTs to receive personalized benefits such as exclusive merchandise and early access to product releases.
Twitter Sales Channel, a tool that allows merchants to highlight their products on their Twitter profile and sell to their audience on Twitter.
Tap to Pay on iPhone, which leverages a partnership with Stripe to enable Shopify point-of-sale merchants to expand into offline retail without additional hardware.
Local Inventory on Google, a tool that automatically notifies nearby customers when a product is available in store.
Shopify Functions, which allows developers to extend or replace Shopify’s backend logic with custom code.
Shopify has also released some smaller updates over the past six months. The company has added data sharing controls, money management tools, carbon neutral shipping options, and its Shopify Capital tool has increased the funding limit for first-time borrowers.
For a look into the rest of the 100+ announcements Shopify is making today, check out the Shopify Editions release page.
While many of the new releases themselves are notable, so is the way the company has decided to unveil them. By rolling up all of the new updates and releases into one large announcement, Shopify is able to make a big deal of even the smallest of updates. For fintechs with fast development cycles and international rollouts, this could be a good model for complex public releases.
Canada-based Shopify was founded in 2004 to bring ecommerce websites and tools to retailers. Since then, millions of businesses in 175 countries have used Shopify to make over $496 billion in sales. Tobias Lütke is CEO.
With $10 million in funding, the EDF is designed to financially support companies and projects that can bring value to the Polymesh ecosystem. DigiShares received its grant for integrating Polymesh and expanding the Polymesh ecosystem to DigiShares’ network of clients and partners. Additionally, DigiShares will facilitate the migration of its clients’ current ERC-1400 assets from Ethereum to Polymesh. DigiShares has supported ERC-1400 on Ethereum since 2019 and been an early supporter of Polymesh, as well, having joined the company’s partnership ecosystem back in January of 2021. The integration announced this week will allow issuers to DigiShares’ tokenization platform to create and manage security tokens on Polymesh.
“Polymath has been a long and trusted partner of DigiShares and we are proud to soon support the Polymesh blockchain,” DigiShares CEO Claus Skaaning said. “We believe that Polymesh has long term potential to lead the security token space.”
The grant award announcement arrives weeks after the Polymesh Association introduced its Ecosystem Development Fund, which itself follows the listing of Polymesh’s native token POLYX on Huobi, one of the largest cryptocurrency trading platforms in the world. The fund is a wager that financially backing businesses that can help promote wider adoption of Polymesh will prove an effective way to incentivize companies to build, integrate, and use the institutional-grade blockchain infrastructure.
“The Ecosystem Development Fund delivers two benefits to service providers,” Polymesh Association Head of Tokenization Graeme Moore said. “Successful applicants not only receive funding but they can also attract clients by adding a Polymesh integration to their roadmap.”
Founded in 2018 and headquartered in Aalborg, Denmark, DigiShares made its Finovate debut last year at FinovateSpring 2021. At the event, the company demonstrated its white-label tokenization platform for real estate, which adds both automation and liquidity to the property market. The DigiShares platform digitizes and automates both the financing and the corporate management aspects of real estate projects. The platform also provides a bulletin board marketplace that leverages blockchain technology and peer-to-peer trading without counterparty risk.
Among Finovate’s newest alums, Polymath demonstrated its Polymath Token Studio at FinovateSpring last month in San Francisco. The Token Studio is an interface that enables the user to create, issue, and manage blockchain-based securities. “Thanks to blockchain and tokenization we can reduce the costs of creating, issuing, and managing securities by over 90%,” Moore explained from the Finovate stage in May. “Banks, custodians, transfer agents, broker-dealers and these other service providers can give their clients new and fresh experiences, and we can create new securities and new financial instruments that previously weren’t possible.”
Polymath and the Polymesh Network are based in Zug, Switzerland. Vince Kadar is Polymath CEO.