The Rise in Prominence of Virtual Accounts

Open banking and real-time payment opportunities have forced the global transaction banking industry to rapidly undergo fundamental changes. By offering effective virtual account services, banks can stand out in an experience-driven ecosystem and generate potential revenue sources.

The ability of Payment Service Providers (PSPs) and FinTech firms to manage their client flows is a game changer. Virtual accounts are a sophisticated, technology-enabled banking tool to simplify, streamline, and consolidate merchant flows and reconciliation. They can become a strategic enabler for banks and corporates.

New-Age Treasury With Virtual Accounts

Virtual accounts, also referred to as ‘shadow accounts,’ are a set of non-physical accounts used to make and receive payments on behalf of real accounts. They are subledgers that divide the balances within a physical bank account and attribute all transactions to the correct virtual account. Every virtual acco …

How Companies Can Fight Online Fraud With Phone-Centric Identity

Identity theft, one of the most common contributors to fraud globally, has been on the rise since the start of the COVID-19 pandemic. According to a study by Javelin Strategy & Research, fraud losses due to identity takeover rose 15% in 2019 compared to the previous year. The study also notes that 40% of identity takeover-related fraudulent activities take place within a day of opening an online account. 

In this article, we’ll explore how companies can protect themselves and their customers from rising identity fraud attacks using step-up authentication with Phone-Centric Identity.

A Look at Top Four Cyber Fraud Attacks

IcedID Banking Trojan: This phishing attack started in March 2020. Users of several financial institutions and e-commerce companies have been victims of IcedID attacks. Fraudsters use steganography techniques, i.e., the practice of hiding malicious code in image files, to trick users into opening COVID-themed attachments. The malware collects users’ credentials and online financial data. 

Vizom: Vizom uses remote overlay attacks and DLL hijacking by disguising itself as video conferencing software. Once downloaded, the malicious code detects online banking transactions. What follows is a series of fraudulent transactions from a victim’s bank account. This malware was first used for cyber fraud in Brazil but is reportedly spreading to other South American countries and Europe.

Mobile Emulator Farms: Fraudsters use malware to access mobile devices and mobile emulators and set up thousands of spoofed devices. This helps fraudsters steal a victim’s online credentials. As the entire device, including device characteristics, is emulated, fraudsters can easily circumvent standard security methods such as device binding. Fraudsters have reportedly used over 20 such emulators. 

SIM Swapping: SIM swapping is one of the fastest-growing fraud vectors globally. Scammers trick victims into sharing their personal information and use it to fake identity documents to secure duplicate SIM cards or port a number to one of their existing SIM cards. They gain access to SMS-based one-time passcodes, which are later used to authenticate transactions. 

Fight Identity Fraud with Step-Up Identity Authentication 

The general pattern in most fraud-related cases can be broken down into two parts—stealing identity credentials by installing malware on devices and executing fraudulent transactions using the stolen credentials. 

While educating consumers on best practices to avoid online fraud is a good initiative, it may not be enough. Companies need to safeguard their customers against fraudulent transactions by strengthening transaction-level security using robust authentication methods. Multi-factor authentication (MFA) techniques using SMS- and voice-based one-time passcodes (OTPs) have existed for a long time. However, fraud vectors such as those based on SIM swaps can still manage to circumvent them. A study of 385,000 transactions by Prove revealed that 5% of MFA-based mobile transactions still had low SIM tenure, indicating a high likelihood of SIM swap.

The solution to reinforcing step-up authentication lies in using Phone-Centric Identity. Phone-Centric Identity refers to a broad set of phone signals that can be combined with data and transactional attributes from other sources such as banks and credit bureaus to perform stronger authentication and identity verification. These signals include line tenure, line behavior such as calls, texts, ad-views, line event history, SIM swaps, and event velocity. Since mobile phones provide the most comprehensive digital footprint of a consumer, the volume and diversity of signals collected over a long time provide the highest correlation to consumers’ identities. Phone-Centric Identity can either completely replace traditional authentication methods, such as passwords and OTPs, or strengthen them. It can also eliminate the need to download soft tokens or use physical hardware for authentication, thereby improving customer experience. 

The Way Ahead

Continuous innovations and improvements in security leveraging alternate data sources and signals are key to a steadfast response to emerging threats. Phone-Centric Identity, combined with emerging techniques such as passive biometric authentication and behavioral detection, is critical to mitigating these types of threats.

This article is a synopsis of a full-length article originally published by Prove.

FinTechs Targeting Underserved Communities

Globally, financial inclusion and equal access to financial services have been addressed for the most part. This can be attributed to a financial system that has evolved over the years, powered by technological advances in the areas of telecommunication, artificial intelligence (AI), machine learning (ML), and data management solutions, as well as the relaxation of stringent banking regulations and increasing financial education and awareness. Only a few countries lack fairly stable financial access. 

Even though technology has democratized financial access to a great extent, some disparity continues to exist because of diversity in cultural backgrounds, race, religion, and gender. This disparity is further fueled by societal factors such as income inequality that has dictated for centuries. In the US, for example, migrant workers are paid much less than their counterparts who are US citizens. According to some

An Overview of Regulated Cryptocurrency Exchanges Across the World

We cover more than 60+ sub-segments in FinTech – but we do not stop there; we also cover topics beyond FinTech, such as InsurTech, RegTech, PropTech, WealthTech, BankTech, AgriTech, and the enabling technologies enabling innovation such as AI, Blockchain, etc.

France Emerges as a FinTech Hotspot in Continental Europe

FinTech is an emerging industry aimed at developing innovative technological solutions for the traditional financial ecosystem. Financial technology companies, popularly known as FinTechs, offer customers personalized and efficient services at a comparatively low cost. The sector comprises startups in segments such as digital payments, online wallets, alternative finance, online insurance, and financial management, as well as technology ventures initiated by some established financial service providers. With the advent of 5G, artificial intelligence (AI), blockchain, machine learning (ML), and other innovative technological solutions, FinTech has registered tremendous growth over the past few years. The COVID-19 pandemic has also provided a significant boost to the digitally active sector.

The FinTech landscape in France is almost on par with the FinTech landscape in other developed countries though the rate of FinTech adoption among consumers is somewhat less compared to fellow European countries where customers have a penchant for innovative FinTech solutions. Despite the lower adoption rate, France continues to be one of the major players in the European FinTech industry.

Growth and Future Potential

Britain’s move to exit the …

Why Are Some Countries Banning Cryptocurrency?

Cryptocurrency, or electronic currency, is an oft-repeated word in the financial world. Reports suggest that the cryptocurrency market came into existence after the group or person known as Satoshi Nakamoto released a white paper named ‘Bitcoin: A Peer-to-Peer Electronic Cash System’ during the global financial crisis of 2008. Bitcoin, the most popular form of cryptocurrency, has been floating in the currency market since 2009. One of the first known transactions was made in 2010 by an individual who used 10,000 bitcoins to order two pizzas! The idea behind cryptocurrency was to enable people to control their money without government interference or regulations.

Since 2010, the cryptocurrency market has been growing in leaps and bounds with the influx of several new entrants such as Ethereum, Litecoin, Ripple, and Dogecoin. Several of the world’s wealthiest people have invest …

FinTech and Community Bank Partnerships in the United States

FinTech enables banks through collaborative relationships and partnerships to offer personalized customer experience, transform infrastructures, adopt open architectures, cloud computing, automated processes, data security & storage, and subsequently faster time-to-market. Quite a few large banks today recognize themselves as technology companies instead of service organizations. Community banks, though, have been passive in joining the FinTech disruption. Economic conditions created by COVID-19 are changing this scenario.

Community banking is a relationship-based business model. They provide traditional functions such as accepting deposits and providing business loans, mortgages, and credit lines and have less than $10 billion in assets. Personalized experience and customer satisfaction have been the key characteristics of community banks, two advantages that FinTech brought to typically-large banks. The partnership opportunity for FinTech and community banks is better processing capability and the technology to build and launch quickly. FinTech has made plug-n-play open architecture mainstream. While big banks leverage FinTech for agility and enhanced customer experience, community banks lag in technology innovation to adopt FinTech solutions.

The number of community banks has been shrinking over the last 10 years. The US had nearly 5000 (4,750) community banks in January 2020, and they hold about $3.2 trillion in assets. Community banks represent 97% of the US banking industry by count.

In the last three years, community banks have started engaging with FinTechs outside of regulators. E.g., Alloy Labs Alliance was set up in 2018 with over a dozen community and regional banks to explore FinTech opportunities. Alloy Labs’ members serve over 50 million customers, primarily small and …

New-Age Core Banking Solutions

Banking is one of the key drivers of economies worldwide. Core banking typically includes deposit and loan and credit processing capabilities with interfaces to general ledger systems and reporting tools. The global core banking software market size is expected to reach $15.7 billion by 2026. 

In recent years, core banking has transformed exceptionally from on-premises centralized batch processing systems to cloud-based, decoupled-but-integrated real-time systems. The need for cost-effective solutions, a single customer view, and the ability to launch and scale quickly is augmenting the growth of the core banking solutions market.

Core Banking Is Shifting from Transactional to Experiential Banking

New entrants to the FinTech space have disrupted the core banking space with their focus on customer experience, digital interaction, and pushing banks to evolve into platform-based models. Software-as-a-service (SaaS) and cloud-based services are becoming part of bank infrastructure. Challenger banks and neobanks have almost 39 million users worldwide. They provide low-cost, hyper-personalized, and customer-friendly offerings through their branchless business models and plug and play open platform APIs. Digital stacks that …

Mobile as a Catalyst for Financial Inclusion in Africa: Startup Perspective

Financial inclusion is the most important aspect of a country’s economic development plan as it increases the contribution to GDP, enables the government to do more for the well-being of its citizens, and fosters a favorable climate for businesses and business expansion. However, achieving financial inclusion is easier said than done. As per the latest Global Findex Database published by the World Bank, close to one-third of all adults worldwide, i.e., 1.7 billion people, remain unbanked. Women, poor households in rural areas, and those who are not part of the workforce constitute half of this unbanked population.

In Africa, 370 million people out of the total population of 590 million are unbanked and unserved. Digital financial services play a significant role in accelerating financial inclusion in the continent. One such financial service is mobile money, a catalyst driving financial inclusion in the Sub-Saharan region and attracting the African population. Mobile money is currently present in 95 countries and has 290 deployments worldwide. According to GSMA’s 2019 report, 50 million new accounts were registered in Sub-Saharan Africa. However, according to a recent estimate by the World Bank, COVID-19 could push up to 40 million people in Sub-Saharan Afri …

India’s Open Credit Enablement Network (OCEN)

Embedded finance is fast growing as a game-changing opportunity for incumbents and new FinTechs alike. It is estimated to offer a market opportunity of over $7 trillion by 2030. Lending has not been the leading segment in embedded finance because of its complexity. However, emerging new digital business models that use plug-and-play tech enable businesses to easily manage and sell even highly regulated and relatively complex services such as lending as an embedded service.

New digital models set to optimize the Indian digital lending market with innovative products and services.

The digital lending market in India is expected to grow to $100 billion by 2023. A contributing factor is the untapped customer base of over 300 million Indians who have remained outside the formal credit market. Current rails for the flow of capital into this untapped market are broken. Recently digitized users such as small shop owners, farmers, traders, entrepreneurs of MSMEs, rural self-help groups, and gig economy workers are increasingly generating a digital transaction history that could be used to inform and build trust with financial institutions. However, the availability of appropriately sized, priced, and timed credit products is still not optimized.

Open Credit Enablement Network (OCEN) – A New Paradigm To Facilitate Credit Flow

IndiaStack brought the firs …

Phone-Centric Identity: A Reliable Path to Identity Proofing

Phone-Centric Identity, also known as Mobile Identity, Device Intelligence, or Phone Intelligence, refers to technology that optimizes and analyzes mobile, telecom, and other signals for fraud prevention and identity verification and authentication.

Correlation between Phone-Centric Identity Signals and Digital Trust

Phone-Centric Identity relies on billions of real-time signals pulled from authoritative sources, making it a powerful proxy for digital identity and trust. Phone-Centric Identity signals are highly correlated with identity and trustworthiness as mobile phones are ubiquitous (many people have them) and frequently used devices.

The chart given above, taken from a McKinsey report titled ‘Fighting Back Against Synthetic Identity Fraud,’ shows that profiles with higher depth and consistency were less vulnerable to fraudulent activities. Phone-Centric Identity signals—which include phone line tenure; phone behavior such as calls, texts, logins, and ad views; phone line change events as ports, snap-backs, true disconnects, and phone number changes; phone number account takeovers such as SIM swaps; and velocity and behavior of change events—have high consistency and depth. Unlike social security numbers or passwords that can be easily purchased on the dark web by hackers and used to break into a consumer’s account, Phone-Centric Identity signals are foolproof. 

‘Possession’ Check

Phone-Centric Identity leverages mobile phones as a ‘what you have’ factor that companies can use to determine whether they are interacting with their customer or a fraudster. This check, often referred to as a ‘possession’ check, returns a binary answer (yes or no) about whether a company is interacting with its customer or someone else.

Privacy and Customer Experience 

Phones also have built-in passive authentication, encryption, and privacy. Companies can apply Phone-Centric Identity technology to web, app, mobile, chat, call center, and even in-person interactions. The technology simplifies and eases new account opening, logging in, resetting passwords, moving money, and calling a contact center for support.

Companies looking to verify and authenticate their customers in a secure fashion without compromising on customer experience are increasingly preferring Phone-Centric Identity and Mobile Identity/Device Intelligence. One World Identity (OWI) highlighted this space as highly influential in its January webinar on The 2021 Digital Identity Landscape.

“We’re seeing that become more and more relevant,” said Cameron D’Ambrosi, Managing Director, OWI. “Being able to rely on that device as a proxy for a human—especially a mobile device—because how many of us are attached at the hip to our smartphones all day every day? Both in terms of the velocity of those data attributes that we’re feeding into the digital identity ecosystem—making those extremely valuable—and the fact that when you lose your device or it’s stolen or taken over maliciously, you are probably going to recognize that very, very quickly as a consumer.”

Checks for Companies Looking to Enhance Their Identity Verification and Authentication

Even though the signals that Phone-Centric Identity analyzes are complex, the concept is quite simple and is centered around three main factors: Possession, Reputation, and Ownership.

  1. Possession: Is the customer in possession of the phone number? Knowing that someone is in possession of a phone at the precise moment of a potential transaction helps identify someone regardless of the transaction channel and helps ensure the customer is indeed on the other end of an interaction. 
  2. Reputation: Are there risky changes or suspicious behaviors associated with the phone number? Typically, people have had the same phone number for a long time and upgrade phones only every few years. Compare that to a burner phone, or a phone that underwent a SIM swap, or a phone number that was just registered. These activities damage the reputation of the phone itself, allowing companies to flag the phone regardless of the customer activity. 
  3. Ownership: Is the customer associated with the phone number? It is crucial to associate a phone number with a person when confirming that the customer is in possession of the phone. Otherwise, a wrong person may be verified. 

Use Cases of Phone Intelligence

Some popular use cases among the many applications of Phone Intelligence are as follows:

  • Identity verification/identity proofing
  • Seamless login authentication (two-factor authentication/multi-factor authentication)
  • SIM swap fraud/account takeover prevention
  • New account creation/user acquisition
  • Authenticating call center calls

With more companies shifting to digital customer interaction, this ‘PRO’ model of identity is emerging as a modern alternative to legacy identity verification methods. Phone-based authentication enables companies to approve more legitimate customers in real time, helping those customers do just as much, if not more, online as they would be able to in-person. 

This article is a synopsis of the full-length article originally published by Prove.

Indonesia FinTech Report 2021 – By MEDICI

For the past many years, Indonesia has been topping the FinTech leaderboard in Southeast Asia. Indonesia has the most thriving FinTech sector, be it the number of startup enterprises or the massive private investments that the sector attracts. Against this backdrop, MEDICI has recently launched a new comprehensive study titled ‘Indonesia FinTech Report 2021.’ In this article, we share some snippets from the report.

FinTech Funding Trend in Indonesia

The country has over 300 FinTechs. The three-year period (2018–2020) considered for the report witnessed over $849 million in investments in the FinTech sector. Super app Gojek raised $5 billion in various rounds during this period. However, we have not considered these rounds under FinTech funding as the amount was used for the overall development of the Gojek ecosystem, which includes its digital wallet GoPay. According to MEDICI’s analysis of the market over the last three years, there has been a steady growth in FinTech funding in Indonesia.

A detailed analysis is available in our Indonesia FinTech Report 2021. You can access the full report here.

According to MEDICI’s report, 2020 was a defining year for FinTech funding in Indonesia with over 77 deals garnering $329 million, the highest ever. The Payments sector raised the highest amount of money ($158 million). Digital wallet LinkAja closed the most significant fundraising round (Series B) at $100 million. The year 2020 was favorable for the Lending sector in terms of the number of deals (7). However, the sector was able to raise only $94 million, which pales in comparison to the $301 million raised in 2019. InsurTech also registered significant funding ($68 million) mainly because of the $54 million raised by PasarPolis as part of its Series B round.

A detailed analysis is available in our new Indonesia FinTech Report 2021. You can access the full report here.

Segment-Wise Distribution of FinTech funding

FinTech companies in the growth stage (Series B and Series C) raised almost 84% of the total funding in Indonesia last year. LinkAja, PasarPolis, Payfazz, Modalku, Investree, and Ayoconnect were some of these companies. The number of early-stage (Seed and Series A) deals declined by nearly 50%, from 20 in 2019 to 11 in 2021. This can be attributed to investors’ risk-averse nature toward new players, owing to the COVID-19 pandemic. 

The Indonesia FinTech Report 2021 provides a detailed analysis of the FinTech segment-level composition of the Indonesian FinTech landscape. You can find the report here.

FinTech Consolidation

M&A deals are slowly increasing in the FinTech sector in Indonesia. In 2020, Gojek, Indonesia’s most successful Unicorn, purchased point-of-sale (POS) and payments aggregator Moka for $130 million; this purchase was one of the biggest deals in the sector. Moka provides POS and payments services to over 35,000 outlets in more than 100 Indonesian cities. With this acquisition, Gojek has now entered the payment acceptance space. In the same year, online investment platform FUNDtastic acquired Invisee, a mutual funds and securities portal, for $6.5 million. This acquisition of Invisee, a mutual fund selling agent (APERD) licensed by the Financial Services Authority (OJK), would allow FUNDtastic to directly sell mutual fund products. In 2019, stock trader platform Stockbit acquired mutual fund app Bibit and relaunched the latter as a robo-advisory platform. The M&A space will be keenly watched as companies try to identify potential competitors and allies in new segments for acquisitions or partnerships.

With a young population (the median age is 30.2 years) eager to adopt digital technologies, Indonesia is poised to become one of the world’s largest FinTech ecosystems. There are many untapped markets such as insurance, as only 2% of Indonesians have private insurance and just about 2% of Indonesians have participated in the stock market. These are the sectors that will attract the most amount of interest going forward. Besides, the country is home to 63 million small and medium enterprises. Companies looking to digitize their operations and thereby improve their productivity will also catch the eye of investors. A young working population and an economy focused on digitization will ensure that FinTech adoption in Indonesia reaches newer heights. 

About the Report

In February 2021, MEDICI published the Indonesia FinTech Report 2021, a comprehensive study based on MEDICI’s proprietary FinTech data of thousands of startups, deep market intelligence derived from years of tracking the FinTech industry, and secondary research that was refined through brain-storming sessions and in-depth interviews with segment experts to extract valuable market signals from the noise, identify market trends, and develop viewpoints for the report.

What More to Expect from the Indonesia FinTech Report 2021 by MEDICI

This 54-page report by MEDICI takes an in-depth look at the following:

  • FinTech Funding in Indonesia – Total funding and segment-wise funding break-up 
  • Overview of regulation 
  • Bank and FinTech partnerships
  • Impact of COVID-19 on the FinTech landscape
  • FinTech consolidation – M&A analysis
  • Open banking and financial infrastructure APIs
  • Rise of B2B FinTech (covering WarungTech)

A segment-level deep dive analysis covers the following:

  • WealthTech
  • Lending
  • InsurTech
  • Payments
  • B2B FinTech

Grab your copy of the full report here.

January 2021 FinTech VC Funding Statistics – Payments, WealthTech, and Lending Topped the Charts

We cover more than 60+ sub-segments in FinTech – but we do not stop there; we also cover topics beyond FinTech, such as InsurTech, RegTech, PropTech, WealthTech, BankTech, AgriTech, and the enabling technologies enabling innovation such as AI, Blockchain, etc.

The High Cost of Poor Customer Data Quality: How It Impacts Your Business

Have you paid attention to the quality of customer data in your enterprise? The price you pay for poor data quality is high, and it might be affecting your bottom line.

Poor-quality customer data can be a serious roadblock hampering operational efficiency, business performance, and customer engagement. Increased operational overheads due to inefficient processes, revenue loss on account of customer attrition, and lost cross-selling opportunities are some of the adverse outcomes of poor-quality customer data. 

Data quality at the source level and the reliability of those data sources are the root causes of low-quality customer data. The solution lies in adopting a modern approach to identity which goes beyond traditional data sources and leverages phone-centric data, attributes, and characteristics. A white paper titled Inaccurate Data Is Damaging Your Business and Your Bottom Linerecently published by Prove, cites the reasons for customer data quality issues and the approach to mitigate them.

Enterprises Pay a Heavy Price for Poor-Quality Customer Data

According to a report by Dun & Bradstreet, 42% of the 500 companies that were surveyed admitted that they have struggled with inaccurate data. Successful digital onboarding and servicing of customers depend on efficiently managed processes and seamless customer experience. Poor data quality may lead to a tedious and confusing onboarding process. Poor data prevents seamless customer verification and creates the need for additional validation. The eventual outcome is high application abandonment and, therefore, loss of revenue. Companies also risk business reputation on account of customer dissatisfaction and potential compliance issues.

A detailed study conducted by RingLead points to the key reasons for and the impact of bad data. Here are some of the major findings:

  • Data quality issues affect large and small businesses. Small businesses can lose up to 6% of their annual revenue to poor-quality data.
  • 21% of the companies admitted to reputational damage caused by inaccurate data.

There are several root causes of poor data quality. Incomplete information provided by a customer, fragmented information across multiple data sources, and failure to keep the data current are some of the main reasons.

Addressing Poor Data Quality With Phone-Centric Identity

A consumer’s phone number is the new national identifier. Modern platforms for data sourcing leverage the high accuracy provided by various data signals linked to a consumer’s phone number for identifying and validating the customer with a high level of confidence. Phone characteristics and attributes such as line tenure, line behavior, event history, and event velocity correlate with identity risk. The utility of a user’s phone number and its linkage to several other authoritative data sources, both public and private, have made it a vital cog in the identification and verification of a consumer’s identity. 

Verified and trusted phone data is one of the richest sources of information available about a consumer. The credibility and quality that phone data provides can massively transform business processes and customer experience, making them more efficient and engaging.

Download Prove’s white paper titled Inaccurate Data Is Damaging Your Business and Your Bottom Line here.

This article was originally published on Prove, and it has been syndicated and republished here with approval from Prove.

Australian FinTechs Gaining Ground in the Traditional Financial Landscape

We cover more than 60+ sub-segments in FinTech – but we do not stop there; we also cover topics beyond FinTech, such as InsurTech, RegTech, PropTech, WealthTech, BankTech, AgriTech, and the enabling technologies enabling innovation such as AI, Blockchain, etc.

The Rise of ESG Investing in the Year of the COVID-19 Pandemic

Sustenance and resilience emerged as key indicators of longevity for most organizations amid the COVID-19 crisis in 2020. As a result, sustainable investing has attracted more attention from investors. The Environmental, Social, and Governance (ESG) investing market is estimated to reach $1.3 trillion by 2030.

Environmental, Social, and Governance (ESG) Investing

Over 40% of FinTech professionals believed that more investments in the future will be made in FinTechs that innovatively address ESG challenges by 2030, according to a survey by Tribe Payments.

ESG investing seeks returns and long-term impacts on society, the environment, and business performance. An investor may consider ESG criteria while making an investment decision. Among the three criteria, Environment receives special attention from analysts and investors alike. In 2020, though, Social grew in prominence owing to the COVID-19 pandemic. This factor includes empl …

Bangladesh – The Rising FinTech Star in South Asia

Asia has some of the largest and fastest-growing economies globally, and it is home to countless FinTech startups. The FinTech market in Asia-Pacific is expected to cross $150 billion by 2025. According to EY Global FinTech Adoption Index 2019, China and India lead the FinTech Adoption Index at 87%. Bangladesh, a neighbor to both these fastest-growing FinTech markets, is accelerating its FinTech adoption by leveraging mobile technologies.

Digital Payments is the largest FinTech segment in mature and upcoming FinTech markets alike, mainly because of the acceptance and implementation of mobile technologies. Bangladesh is one of the economies where the Payments segment (FinTech) is performing well because of mobile phones.

FinTech in Bangladesh

The current startup ecosystem in Bangladesh is valued at $1.45 billion and has the potential to reach a $10 billion valuation. Financial inclusion in the country increased from 16% in 2011 to 37% in 2018. Despite remarkable progress, Bangladesh remains one of the economies with the largest unbanked population. All FinTechs put together process $4 billion in monthly transactions. The Remittances segment is catching up owing to money transfers by expatriates. Lending and Personal Finance are the other segments that are registering growth.

Key challenges faced by FinTechs in Bangladesh:

  • Lack of financial and technological literacy, a large unbanked population
  • Most SMEs not unified under a formal financial system
  • Conventional banking system mostly not user friendly

Data Localization and Its Impact on FinTech in India

Technologies such as cloud computing, data analytics, artificial intelligence, the internet of things, and APIs have significantly underscored data and data availability at the desired time and location. However, increased digitization has led to barriers such as data localization regulations, which are hampering the growth of technology.

Data localization laws place restrictions on where and how data can be stored or transferred.

Data localization laws require all or specific data held by companies to be stored and/or processed locally in a particular country or a local computing environment, rather than on the cloud. The scope and stringency of these laws vary across countries. Data localization laws apply to the following types of data:

  • Profile data
  • Financial data
  • Health data
  • Employee data
  • Payment data 

Data Localization in Countries

China, Russia, Indonesia, Vietnam, and Nigeria are some of the countries with data localization laws in place.

China and Russia are among th …

The Unicorn Club Expands in 2021

We cover more than 60+ sub-segments in FinTech – but we do not stop there; we also cover topics beyond FinTech, such as InsurTech, RegTech, PropTech, WealthTech, BankTech, AgriTech, and the enabling technologies enabling innovation such as AI, Blockchain, etc.

Rise of Buy Now, Pay Later and Its Pitfalls

The current credit market has evolved from money lenders to banks to a new, tech-fueled credit environment. Artificial Intelligence (AI) and Machine Learning (ML) bots are making credit decisions without human intervention. Essentially, credit is based on a promise of repayment and the anticipation of return in the form of interest.

Credit Industry 

While most forms of credit are well-regulated, including credit cards and bank loans, there is still an unexplored jungle with loan sharks, payday lenders, and pawnshops. Dubious tactics and lenient regulations have harassed numerous consumers who have approached such lenders not out of choice but for survival. ‘Morality’ aside, these types of lenders still play a crucial role in the credit system by fulfilling their borrowers’ immediate requirement; they target consumers on the fringes of the formal credit market—those that credit reporting institutions have written off.

Rise of BNPL

The expanding middle-class …