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Lending: A destination in itself

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Lending - A destination in itself - Main

As fintech investors, lending is at the heart of what we do. In recent years, though, our approach to investing in lending and lendtech startups has evolved, as we have integrated past learnings to bet on future winners. 

Over the last decade of innovation in lending, a number of product and business models that benefitted from a lot of hype in their early stages have not followed through. Either they have not grown to their full potential, or they have not reached the value on public markets that they had expected. 

One example of the former is P2P (peer-to-peer) platforms, which have been subject to a ‘glass ceiling’ relegating them to niche players. What was perceived as the ‘biggest disruption in the history of banking’ in the early 2010s has stagnated, with minimal changes to market share. 

With respect to not reaching expected value on public markets, this is less of an industry issue, and more to do with many lenders forgetting about the need to interact with capital markets efficiently. This leads to building that indispensable part of the business far too late in their growth trajectory, which requires more company resources than most founders would want. Too often, access to capital markets is the ‘break it or make it’ factor hindering real scale.

We have also seen how, when the drive to leverage emerging and innovative technology of the early days fades away, many neolenders become ‘just another credit provider’ in the eyes of their clients. This is key: all innovation in lending has been marked by a tension between being and remaining a technology company—and retaining such recognition by the public—and building ‘yet another good old incumbent’. 

So, where does that leave fintech investors? 

Well, we have come to terms with one thing: lenders are lenders. That means that there will have to be compromises. No matter how cool a lender is, they will have to turn down some applicants. No matter how innovative they are, they’ll need to adapt their language to ensure that they can communicate their value to the capital markets operators that are needed to fund them. 

Those considerations create questions around how new lenders can maintain their ‘tech-enabled’ status as their business grows. In our view, it’s about changing the way lending is viewed—moving it from a necessary point on a journey to the destination itself. 

Lending - A destination in itself - Manuel Silva Martinez
Manuel Silva Martinez, general partner at Mouro Capital

Lending as a destination in practice

How can lenders, and indeed, their venture capital partners, start to move this needle? 

First, by thinking about utility rather than economics. Consumers and businesses don’t only care about the nitty gritty such as APR and annual fees. Of course, they want to be secure in the knowledge that they aren’t being ripped off, but much like any other financial product, their primary driver is the utility that credit gives them.

For consumers, this might be whether they’ll be able to afford to purchase the products they desire, or to keep their family afloat if things don’t go as planned financially. In the world of microfinance, this has been embedded into the culture, but those basic human behaviours apply to all clients, even those with deeper knowledge of the financial industry. 

Second, by adapting, rather than imposing. Incumbent banks themselves would likely admit that creating products that adapt to fast-changing client needs is not one of their strengths. This is particularly true in the business lending space, where on-boarding can take weeks, and credit scoring is often based on data like last year’s balance sheet, or information on at least three years of operations. This has created a significant gap in the ecosystem, where venture-backed startups growing threefold each year, highly seasonal retailers, or businesses that have just hit the headlines and need support meeting new demand, have nowhere obvious to turn. 

This is a gap that lendtech startups can and should fill. This starts with being ‘data-smart’ at onboarding, by creating data structures that allow the lender to be a step ahead of clients’ needs. As with all financial products, the customer experience is also crucial, and neolenders should prioritise speed, availability and transparency throughout the underwriting and disbursement processes.

Finally, lenders should focus on building their share of mind to fight irrelevance. Regardless of the sector, if you want to be a tech company, you simply must be product-led. More than this, though, the ambition should be to become a core, and even branded, part of clients’ financial and operational lives. That requires rethinking product/market fit beyond basic lending considerations and building functionalities that enhance the user experience beyond the credit cycle.

Those that thrive, rather than survive, will go one better and develop functionalities that have standalone utility while also improving the lending experience. Of course, this still leaves the question of how verticalised the lending experience should be, but that’s a whole separate discussion!

There are a select few neolenders that are innovating in line with these principles, and these will be the businesses that build a reputation for themselves and drive the sector consolidation that is no doubt coming. Those that don’t will be left behind.

Fintern raises £32m to expand access to affordable loans in the UK

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Fintern raises £32m to expand access to affordable loans in the UK
Alison Harwood, Varengold Bank; and Michelle He, Mark London and Gerald Chappell, Fintern

UK-based startup Fintern has raised £32 million in equity and debt funding following its public launch last month.

The equity funding comes from a variety of angels, including several fintech founders and business leaders. Debt financing will be provided by Germany-based Varengold Bank.

This provides Fintern with the capital necessary to take the first step in its mission to provide £1 billion of consumer loans by 2025.

Fintern is targeting an estimated UK customer base of 15 million people who turn to payday and other high-cost lenders when unexpected costs arise.

The fintech leverages open banking and AI to build a full picture of each customer’s entire financial situation, including incomings, outgoings, current repayments and repayment history, so that it can open up affordable lending to a much wider audience.

Fintern operates an app, available on both iOS and Android, that connects to a customer’s bank account. From there, its AI takes over to assess affordability and decide whether or not to offer a loan of between £500 and £5,000 for durations of up to three years with a variable APR of 18.8%.

Gerald Chappell, chief executive officer and co-founder of Fintern, comments: “This fundraising puts Fintern in a strong position to deliver on our mission to increase access to affordable personal credit. Our distinctive data driven approach to lending allows us to bypass credit scores, increase approval rates and lower APRs. We’re delighted to be partnering with Varengold Bank on the funding of our loan book, benefiting from their deep experience and commitment to Fintech lending innovation.”

Alison Harwood, head of Varengold’s London branch, adds: “We’re thrilled to be partnering with Fintern to provide wider access to affordable borrowing in the UK. This is another example of Varengold’s wider mission to support fintechs across Europe in providing innovative, customer-centric lending products. Both Varengold and Fintern are passionate about changing the consumer lending landscape in the UK and we’re excited to be working together towards that goal.”

Starling Bank secures £50m investment from Goldman Sachs

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Starling Bank secures £50m investment from Goldman Sachs

Starling Bank has received a £50 million investment from Goldman Sachs Growth Equity.

The investment is an extension of Starling’s oversubscribed £272 million series D funding round announced last month, which valued the digital bank in excess of £1.1 billion pre-money.

This takes the total raised in the series D round to £322 million.

Starling now has more than two million current accounts, including 350,000 business accounts. Its deposit base has increased from approximately £1 billion just over a year ago, to now more than £6 billion. 

It is among the fastest-growing bank for small and medium-sized enterprises (SMEs) in Europe and now holds a 6% share of the UK’s SME banking market. It is on course to report its first full year in profit by the end of its next financial year-end.

The new funding will support Starling’s continued growth. 

Anne Boden, founder and chief executive officer of Starling Bank, said: “Securing the support of another global financial heavyweight demonstrates the strength of demand from investors and represents yet another vote of confidence in Starling. Goldman Sachs will bring valuable insight as we continue with the expansion of lending in the UK, as well as our European expansion and anticipated M&A.”

James Hayward, managing director at Goldman Sachs, said: “Starling is one of the leading and most innovative digital banks in the UK, with an ambitious technology-first leadership team and addressing a deep market opportunity. We are delighted to be supporting their growth with this investment and believe the company has sustainable long-term earnings potential.”

J.P. Morgan expands use of the Acin platform

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J.P. Morgan expands use of the Acin operational risk management and benchmarking platform

J.P. Morgan is expanding its use of the Acin platform to cover its global markets business.

Acin, the software-as-a-service regtech company that has created a digitised platform and peer-to-peer network for operational risk management, enables J.P. Morgan to access benchmarking data for risks and controls. This will complement the existing operational risk management practices established within the global financial services firm.

J.P. Morgan has been working with Acin for the past two years, using the platform within a subset of the trading businesses.

By expanding the scope of use, J.P. Morgan will be able to further validate aspects of ongoing operational risk management and assessment. This will be achieved via Acin’s industry benchmarking capability, through which customers can continuously assess risk and controls against anonymised peer data.

Jamie Hamilton, global head of markets business control management at J.P. Morgan, says: “Our established operational risk management frameworks enable the firm to monitor key areas of risk. The Acin platform and network will enable additional efficiency and a further source of practical validation.”

Paul Ford, chief executive officer and founder of Acin, comments: “With Acin’s operational risk management and benchmarking platform we are supporting clients in digitising, visualising and calibrating operational risk. It’s testament to our solution that, having successfully piloted the Acin platform within a subset of its trading businesses, one of the world’s largest and most innovative banks has deployed it throughout its global markets business.”

“As Acin’s platform is adopted by other leading investment banks, the breadth and depth of the data it provides increases further, lifting standards across the whole industry.”

Late last year, Acin raised $12 million in series A funding to spearhead its efforts to create a complete front-to-back-office solution to assess and manage operational and non-financial risks.

Auxmoney raises €250m to fund consumer loans

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Auxmoney raises €250m to fund consumer loans on P2P platform
Raffael Johnen, chief executive officer of auxmoney

Auxmoney, a digital lending platform provider for consumer credit, has received €250 million in investment from Citigroup and Chenavari Investment Managers

The investment, along with its own funds, will support loans on its own marketplace. Germany-headquartered auxmoney enables consumers to secure finance from private individuals.

Its peer-to-peer lending platform provides automated processes for onboarding, risk assessment and investor reporting, and draws on advances in machine learning to match borrowers and lenders.

Raffael Johnen, chief executive officer of auxmoney, says: “Our investment platform enables us to start new partnerships in a scalable manner and thus continuously expand our investor base. We are pleased to bring more strong partners to the auxmoney platform today. With this trend-setting investment, even more people benefit from the advantages of digital loans through auxmoney.”

Daniel Drummer, chief financial officer at auxmoney, adds: “This financing commitment from a leading global debt investor underlines once again the attractiveness of digital loans as an asset class. The investment strengthens auxmoney’s position as a leading provider of digital access to credit in Europe. We see enormous momentum for technology-based loan offers in the market. Further new partnerships are already in preparation.”

Sebastian Walf, managing director at Citigroup, comments: “We finance fintechs across Europe. The credit performance of auxmoney’s marketplace loans continues to be remarkably stable even in the corona pandemic. We are pleased to enter into this partnership with one of the leading European fintechs.”

Modulr receives investment from FIS Ventures

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Modulr receives investment from FIS Ventures

Payments-as-a-service provider Modulr, based in the UK, has secured new investment from FIS Ventures, the corporate venture arm of global financial technology company FIS.

Following the investment, of an undisclosed sum, FIS plans to leverage Modulr’s API-based payments infrastructure to facilitate and automate real-time, business-to-business payments in the UK and Europe as part of its broader real-time payments strategy.

Myles Stephenson, chief executive officer at Modulr, comments: “FIS and Modulr share the same ambition, to enable businesses to move fast and transform their payment processes, software and experiences in line with the digital world. We look forward to working with FIS to develop and deliver better payments solutions and innovative services to businesses of all sizes.”

Asif Ramji, chief growth officer at FIS, adds: “Our investment in Modulr is a key component of our comprehensive vision at FIS to bring the full power and potential of real-time payments to organizations at a global scale. Working with Modulr, we’ll be able to help our clients in the UK and EEA market accelerate their journey to digital payments, as well as work towards delivering a suite of new global real-time payment propositions.”

Modulr received investment from PayPal Ventures in late 2020 and has raised a total £63.3 million, including a £10 million grant from the Capability and Innovation Fund.

The fintech provides a payments-as-a-service API platform for digital businesses. Using Modulr, they can automate payment flows, embed payments into their platforms, and build new products and services.

In the last year, Modulr has become a directly connected participant of the Bacs scheme, alongside direct participation in the Faster Payments scheme, enabling the fintech to settle and hold funds at the Bank of England.

It has also added direct access to Visa and Mastercard, and delivered a steady pipeline of new products, including payment initiation and confirmation of payee.

The fintech was recently granted an electronic money licence from the Central Bank of Ireland, marking an important step in its European ambitions.

Bringing about new compliance for the new normal, with AI and machine learning

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Bringing about new compliance for the new normal, with AI and machine learning 1

Compliance is generally thought of as a necessary burden, not a business benefit capable of vastly improving efficiency. However, applying artificial intelligence (AI) and machine learning (ML) enhances the precision of the rules used in traditional automated AML processes. This cuts down false positives, reduces operational workload and frees up resources to focus on other areas such as customer relationships.

Traditional rules-based processes capture only one element of a transaction, resulting in false positive rates of 97 to 99%. AML that employs the latest AI and ML capabilities, on the other hand, provides a series of indicators that point to something being higher risk. This reduces false positives while still ticking the compliance box and successfully combating financial crime.

Digitalisation has accelerated across financial services in the past year, but regulation and banking processes have struggled to keep up. This has contributed to a rapid increase in money laundering. Each year, to reduce the damage that could be caused by money laundering fines, banks spend an average of US$48 million on know your customer (KYC) and AML processes, with US banks spending more than US$25 billion a year on AML compliance. 

AI is growing

A wide range of financial institutions have begun to introduce AI-based approaches to combat the rise in money laundering. But this isn’t without its challenges. When we spoke to 300 senior decision makers in European banks, we found a widespread belief that AI implementation to date has been far too inconsistent, potentially compromising their business objectives.

Interviewees believe that AI and ML are absolutely essential in the battle against money laundering in the digital future. And looking ahead, they envisage a future in which robotic processes automatically apply ML techniques to data harvested across the entire transaction chain, rather than just select parts of the process as at present.

Introducing new approaches to AML in the middle of the current wholesale revolution in banking isn’t easy. Traditional banks are held back from introducing new, digital-first approaches by a cocktail of legacy technology stacks, dwindling IT budgets and poor data quality. Organisations will only be able to fully leverage operational efficiencies once they look at the big picture and begin to think holistically about the role of AML and compliance within the broader framework of digital transformation across the enterprise.

Working together to accelerate success

In the battle against money laundering, partnerships hold the key. Financial services providers of all types must now consider both national and international collaborations, sharing data, and approaches to combat increasingly sophisticated and international criminal organisations. 

Pooling data is a vital element of successful AI and ML but it does require that the data is clean, well-labelled and from the right sources. That data must then be managed and interpreted in the right way. Almost one in four (24%) of our respondents cited poor-quality data as a key concern for the success of their IT strategy. And they estimated that up to 15% of real-time transactions are being blocked owing to poor data on either recipients or transaction initiators. 

For AML processes to be efficient and effective, data quality must improve radically. Cross-industry collaboration is the best way to bring about that change.

Register here to download the full whitepaper, Better by design? Re-thinking AML for a digital age.

Ethic closes $29 million series B funding round

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Ethic closes $29 million series B funding round

Ethic, the tech-driven asset management platform that powers personalisation for advisers, has closed a $29 million series B funding round.

The round was led by Oak HC/FT, with participation from existing investors including Fidelity Investments, Nyca Partners, Sound Ventures, ThirdStream Partners, Urban Innovation Fund and Kapor Capital.

This new capital will support Ethic’s continued rapid growth, in addition to further investment in the company’s technology platform.

The funding follows a strong period of growth for Ethic, which saw the company increase the number of assets on its platform by over 10x since its prior round of funding in 2019.

This also comes at a time when global events have boosted investors’ consideration for how their portfolios affect sustainability issues such as racial justice, climate change, worker treatment, democracy, and health and wellness.

Doug Scott, co-founder and chief executive officer of Ethic, says: “We’re grateful to have backers who share our belief that we all have a role to play in fostering a more sustainable and equitable future, and that the capital markets can be leveraged as a force for good.”

“This is particularly true when considering the developments of the last year, which only reaffirm our mission of helping accelerate the transition to sustainable investing.”

Ethic’s series B raise also comes on the heels of a year in which direct indexing, which is core to its offering, has continued to gain significant momentum in the asset and wealth management community.

Following a wave of recent industry consolidation, the company has emerged as one of the largest independent providers of sustainable direct indexing strategies for wealth advisers, with more than $760 million in assets.

Dan Petrozzo, partner at Oak HC/FT, says: “It’s increasingly clear that the future of asset management is personalized, and Ethic is leading the charge.”

“Ethic’s unique direct indexing approach ensures the company is primed to meet a burgeoning demand from wealth advisors, as well as the broader investor community. We’re delighted to be partnered with this mission-driven team that is helping drive a major revolution in asset and wealth management.”

Founded in 2015, Ethic empowers advisers to personalise a given benchmark to correspond with a client’s investment, values, and tax management preferences, while seeking to minimise tracking error to the underlying benchmark.

Advisers can also differentiate themselves and forge deeper relationships with their clients using Ethic’s technology platform to deliver transparent impact reporting, and leveraging its breadth of educational tools surrounding various sustainability issues.

Since announcing its $13 million series A raise in 2019, Ethic has entered into a strategic agreement with Fidelity Investments and has partnered with several large advisory firms.

Banking tech provider NYMBUS launches dedicated business for credit unions

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Banking tech provider NYMBUS launches dedicated business for credit unions

NYMBUS, a provider of core banking technology based in the US, has set up a new business to support credit unions with dedicated fintech solutions.

Nymbus CUSO, a credit union service organisation, will connect credit unions with trusted fintech offerings that enable opportunities for generating new revenue streams while deepening connections and value to members.

A passionate advocate for the credit union movement, John Janclaes has been named president of Nymbus CUSO, effective immediately.

He previously served as president and chief executive officer at Partners Federal Credit Union, which, under his tenure, grew five-fold to more than $2.1 billion in assets and is ranked among the top one percent of credit unions in the US.

Nymbus says leading its new credit union-focused business is a natural progression in a 30-year career of innovation as Janclaes helps bridge foundational credit unions values of collaboration and member service with next-generation solutions for personalised experiences and growth.

Janclaes sas: “To thrive in the new digital age, credit unions have an immediate opportunity to leverage niche digital banking approaches to create new revenue streams and expand reach while continuing to deliver the personalised experiences and differentiated value they are known for.”

“I’m proud to lead Nymbus CUSO and continue my mission as a digital advocate for credit unions in their quest for growth and forward-thinking strategies.”

Jeffery Kendall, chairman and chief executive officer of Nymbus, adds: “Our CUSO signifies a commitment to credit unions by providing strategic partnerships and flexible technology that will create sustainable growth and loyal members.”

“For those wanting to innovate, Nymbus CUSO moves past traditional vendor thinking to create supportive structures for credit unions ready to grow and reach new niche markets.”

Read about Inspire Federal Credit Union going live with the NYMBUS core, internet banking, mobile banking and payment solutions in 2019.

Meniga closes €10 million funding round

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Meniga closes €10 million funding round
The Meniga team

Meniga, a provider of digital banking solutions for some of the world’s largest financial institutions, has closed a €10 million strategic investment round.

Velocity Capital Fintech Ventures, and Frumtak Ventures led the round. Other participants included Industrifonden, the UK-backed Future Fund, and existing customers UniCredit, Swedbank, Groupe BPCE, and Íslandsbanki.

The funding will be used for continued investment in Meniga’s research and development activities, and in particular  the development of innovative green banking products.

In addition, the new injection of investment will help strengthen Meniga’s sales and service teams to meet growing demand and changing dynamics in the global digital banking market.

Meniga’s solutions are designed to help banks leverage data to offer more personalised and engaging services, and increase revenue through their digital channels.

One particular innovation that is currently garnering attention is Meniga’s new green banking solution, Carbon Insight, which is allowing banks to empower their customers to fight climate change.

Georg Ludviksson, chief executive officer and co-founder of Meniga, comments: ”We are extremely pleased with the continued backing from our investors and strategic customers. The new capital will be instrumental in helping us accelerate our expansion into sustainable finance management.”

”We are already working with banks across the world helping them accelerate their green-banking strategies with our Carbon Insight solution. Our Carbon Insight solution is going live with banks in four different countries during 1H 2021 and the demand is accelerating.”

Meniga has also partnered with Visa to accelerate its expansion within the Asia Pacific region. As part of the agreement, the fintech will join the Visa Ready Program as a certified fintech enablement partner.

The new certification means that Meniga’s solutions meet Visa’s global standards around security and functionality, providing further credibility to the fintech’s state-of-the-art digital banking capabilities within Asia Pacific markets.

Meniga will also be listed on the Visa Partner Portal, to help facilitate more opportunities in the region.

TPAY MOBILE boosts senior leadership team

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TPAY MOBILE boosts senior leadership team
Işık Uman and Onur Ergüney

TPAY MOBILE, the full-service digital payments platform for the Middle East, Africa, and Turkey, has made senior leadership appointments for two newly created positions.

The appointments capitalise on its recent acquisition of Payguru and build on its commitment to simplify the complex processes that underpin cross-border mobile payment acceptance across the Middle East, Africa and Turkey.

Işık Uman has been appointed to the role of vice president of global partnerships in Turkey and Sub-Saharan Africa.

A founding partner and chairman of Payguru prior to its acquisition, Uman brings with him a wealth of experience working with mobile network operators.

He led the buy-out of Neomobile’s Turkish mobile payment business, which, under the Payguru brand in 2016, became the first direct carrier billing company granted a payment licence by the Turkish financial regulator.

Under his chairmanship, Payguru became the leading alternative payment provider in Turkey, processing approximately $60 million a year through its direct carrier billing and bank transfer services.

In addition, Payguru senior executive Onur Ergüney has been appointed to the role of vice president of gaming and e-sports at TPAY MOBILE.

Ergüney brings more than 10 years of managerial experience across the gaming, digital entertainment, and telecoms sectors, specialising in payment systems, monetisation, distribution network establishment, and product development.

At Payguru, he was in charge of business development strategies, international merchant relations and compliance. Prior to that, he worked with international companies including Game Sultan, Paytogo and MOL Turkey.

Sahar Salama, chief executive officer of TPAY MOBILE, comments: “The appointment of Işık and Onur in these roles underscores our commitment to accelerating our ambitious growth strategy. Işık and Onur are both proven entrepreneurs, having built and scaled Payguru, and bring with them unrivalled telco, gaming, and e-sports expertise. As we look to further scale TPAY MOBILE and our offering across MEA and Turkey, we are delighted to welcome them to our leadership team and look forward to leveraging their experience across our business.”

Uman says: “After building a highly successful fintech business at Payguru, which I am very proud of, I am excited to join TPAY MOBILE as we embark on this next chapter together. TPAY MOBILE provides an incredible opportunity for the Payguru team to expand our innovative technology to the wider MEA region, where TPAY MOBILE has proven itself the leading player in the mobile payment space.” 

Ergüney adds: “Following the acquisition of Payguru I am thrilled to be joining the TPAY MOBILE leadership team. The opportunity to bring our experience of the gaming and e-sports sector in Turkey and introduce it to the wider MEA region, where TPAY MOBILE has established its presence, is incredibly exciting, and will bring new opportunities for both global and local developers to publish and monetise their games.”

Dreams promotes Lucia Hegenbartova to chief commercial officer

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Dreams promotes Lucia Hegenbartova to chief commercial officer
Lucia Hegenbartova, chief commercial officer at Dreams

Dreams, provider of the financial wellbeing platform that empowers millennials to pay off debt, save, invest and feel better about their money, has appointed Lucia Hegenbartova as its new chief commercial officer.

Hegenbartova will be responsible for building Dreams’s new business-to-business (B2B) unit dedicated to the acquisition and development of partnerships with some of the largest banks and financial institutions across the globe.

In her new role as chief commercial officer, Hegenbartova will play an integral part in developing and executing the B2B go-to-market strategy, overseeing all revenue-generating functions across the sales, marketing and customer success departments, and carrying out Dreams’s international expansion strategy.

Hegenbartova joined Dreams in April 2020, having occupied two other roles within the company, as country manager for Germany, and head of customer success for B2B.

In joining Dreams’s executive management team, Hegenbartova brings with her more than a decade experience of building enterprise software-as-a service companies, having been instrumental in the market launch of three other technology startups in a number of senior roles at companies such as Contiamo, CrossEngage, and commercetools.

The Dreams financial wellbeing platform is currently live as a consumer app in the Nordics, where it has achieved a 16% market share of all 20 to 39 year olds across Sweden and Norway, having helped more than 460,000 users build healthier financial habits by effectively operationalising the latest insights from cognitive and behavioural science.

In 2020, Dreams announced two strategic partnerships with banking software provider Silverlake Symmetri, and Ukrainian commercial bank Ukrsibbank (part of BNP Paribas Group), marking an expansion of the company’s business model into the B2B space, as it evolves its services as a provider of effective engagement banking solutions for financial institutions. 

Through its dedicated team of in-house scientists, Dreams leverages cognitive and behavioural science principles and insights to drive product innovation and equip users of the platform with the necessary tools and skills to be better at paying off debt, and saving and investing money.

Dreams’s methodology has enabled the company to gain an unrivalled understanding of the specific needs and wants of the modern consumer, which is what allows Dreams to excel in terms of its marketing capabilities, build highly personalised and engaging services and deliver a first-class digital user experience.

As a result, Dreams is establishing itself as the ideal partner for banks looking to engage critical new audiences, boost customer loyalty and stay relevant in the era of the challenger bank.

Hegenbartova commented: “From day one I’ve been fully on board with the company’s vision of empowering people to feel better about their money, and I’ve been really impressed with how Dreams has already flawlessly delivered on this mission by significantly, and measurably, improving the financial wellbeing of thousands of customers.”

“Through the success of our B2C product in the Nordics, we’ve been able to showcase the tangible business value that caring about customers’ wellbeing can bring to banks and other financial institutions in generating emotional engagement and attracting younger audiences.”

“With the ESG trend rapidly building more and more momentum, the need for banks to ensure their values are aligned with those of their customers is greater than ever, and I’m confident that our unique expertise and proven track record in the realms of engagement banking, sustainability and social responsibility will prove vital in helping banks future proof their digital banking offering.”

She added: “These are now really exciting times for Dreams, as the company looks to consolidate its international expansion and growth strategy, and further transform the entire industry. I’m thrilled to be able to bring this bold vision to life, and I look forward to working with some of the world’s most visionary banking partners and help them prevail at the forefront of the emerging financial wellbeing movement.”

Henrik Rosvall, chief executive officer and co-founder of Dreams, added: ”We’re really pleased to welcome Lucia as part of our executive management team, where she’ll play such an important role in our B2B strategy moving forward. Her track record of efficiently managing teams and her wealth of experience in successfully delivering go-to-market strategies for emerging B2B product categories will prove invaluable to the sustained growth of our company.”

”Having already achieved critical success in Scandinavia, where we have managed to turn the idea of saving into an effortless, fun and social activity for over 460,000 Dreams users, we’re confident that we can replicate this success in other markets. There’s no doubt that Lucia will play a vital role in expanding our global footprint and achieving our mission of helping people make better financial choices at an even greater scale.”

Banking Circle moves infrastructure onto the cloud

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Banking Circle moves infrastructure onto the cloud

Banking Circle, the financial infrastructure provider, is now completely cloud-based, with all aspects of its service hosted within Microsoft Azure.

This includes its purpose built, cloud-first, cross-border payments platform, which delivers greater speed, enhanced functionality, and a more intuitive user experience to its clients.

With Banking Circle already settling 10% of the world’s business-to consumer and €100 billion of point-of-sale business-to-business ecommerce flows, this latest development will underpin the ambitious growth plans of the licenced bank. This supports Banking Circle’s goal of delivering cost-effective and time-efficient payments services to financial institutions globally.

Banking Circle’s cross-border payments platform has been built in-house and is based on microservices, meaning each part of the solution is independently deployable and highly maintainable. 

It delivers best-in-class payment processing times, achieved through a move away from batch-driven to event-based payments processing, while providing clients with real-time insight on the status of their payments.

To boost compatibility and the user experience, it offers open APIs that enable easy integration between the platform’s functions and clients’ workflows. Beyond the core cross-border payment service, these functionalities include reporting, user creation, reconciliation and account balance acquisition.

Anders la Cour, chief executive officer and co-founder of Banking Circle, comments: “To compete in today’s economy, companies have to trade globally. But the painfully slow pace and high cost of cross border payments can hamper business growth.”

“It was always our goal to build a company with technology at its heart and combine it with a banking licence to reduce the cost and time of handling international payments. Traditionally the process has cost €50 and taken five days or more, but we want it to cost 50 cents and take under five minutes. Our cloud-based infrastructure and purpose-built platform is the next step on that journey, further improving the ease with which businesses can send money across borders.”

“Importantly, this allows them to focus on what really matters: their growth and customer experience.”

The company’s entire infrastructure is now cloud-based, meaning Banking Circle can evolve architecture even more quickly in response to the ever-changing demands of its clients.

Decoupled to enable specific aspects to be upgraded without affecting other workloads, Banking Circle will ensure consistent enhancement across its network to reduce payment times significantly and, in turn, enrich the experience clients provide for their customers—a key differentiator in the busy payments space.

Michel André, chief information officer at Banking Circle, adds: “Before developing the new platform we spoke to our clients about what they want and speed was high on the agenda. So, we built the platform in the cloud from the start so that we could focus purely on developing the software that could meet and exceed those requirements. With our entire infrastructure now cloud-based too, we can react even more quickly to client demands and enhance specific areas without compromising on performance.

“I’m also delighted that we’re now able to not just deliver a faster service, but also a more intuitive user experience. By moving to event processing, for example, updates based on live use cases can now be made in real-time—optimising client’s day to day workflows. Ultimately, the new platform brings us one step closer to our ultimate goal of bringing the time it takes for businesses to make a cross border payment down to seconds.”

OakNorth Bank achieves pre-tax profit of £78 million

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OakNorth Bank achieves pre-tax profit of £78 million

OakNorth Bank lent £1.1 billion last year and achieved a pre-tax profit of £78 million.

Since 2015, the bank has lent more than £5.1 billion, with £1.6 billion of facilities repaid, and now has hundreds of borrowers in the UK across a variety of sectors.

By working closely with its borrowers and sharing best practices from their industry peers, OakNorth Bank helped them take timely and appropriate action to address the impact of Covid-19, achieving an average borrower Net Promoter Score of 80 throughout 2020.

In addition to this, the bank has only had a cumulative 10 defaults since inception, six of which have been resolved with 100% recovery and so has had no loan write-offs to date. On the remaining loans in default, it had provisioned for £5 million as at 31 December 2020.

OakNorth Bank has been able to achieve these results thanks to the insights and efficiencies provided by its cloud software that transforms commercial lending, the ON Credit Intelligence Suite.

OakNorth Bank’s lending is supported by its savings franchise, offering a range of Financial Services Compensation Scheme-protected products to savers at all stages of life and businesses at all stages of growth.

Its convenient, competitive and frictionless deposit offering, coupled with its exceptional customer service, has enabled it to attract more than 170,000 savings customers and achieve a depositor Net Promoter Score of 77.

Rishi Khosla, chief executive officer and co-founder of OakNorth Bank, comments: “Given the challenges of the pandemic on society and the economy over the last year, OakNorth’s mission—to empower the Missing Middle—has never been more important.”

“As demonstrated by the tens of thousands of new jobs and homes that have been created off the back of the c.£5 billion we’ve lent to date, these businesses are the most significant contributors to economic and employment growth.”

“They will play a vital role in the post-pandemic economic recovery, so we’re proud to have continued supporting them through not one but two unprecedented events—the Brexit vote and the withdrawal process that followed, and Covid-19. In doing so, we’ve been able to build a robust and profitable business supported by 170,000 loyal savers.”

PayFit raises €90 million for HR and payroll expansion

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PayFit raises €90 million for HR and payroll expansion

France-headquartered fintech company PayFit has raised €90 million in series D funding to continue to simplify payroll and human resource management for all European small- and medium-sized enterprises.

The investment round follows PayFit’s 40% growth in 2020 and was led by Eurazeo Growth, Large Venture and BPI France, with participation and support from existing investors including Accel, Frst and French billionaire Xavier Niel.

The latest investment will support PayFit as the fintech company gears up for a further 80% growth in 2021.

It aims to continue developing its HR solution, consolidate its existing offer and support its growth by increasing its headcount from 550 to 800 by the end of this year.

Launched in 2016, PayFit aims to facilitate complex and time-consuming payroll and HR tasks via software-as-a-service. 

Founded by Firmin Zocchetto (chief executive officer), Ghislain de Fontenay (chief technology officer) and Florian Fournier (chief product officer), PayFit raised €5 million from Xavier Niel in 2016, €14 million from Accel in 2017 and a further €70 million from Eurazeo and BpiFrance in 2019.

PayFit operates in France, Germany, Spain, Italy and the UK, and currently has 550 employees supporting 5,000 companies in managing their payroll and human resources.

ALT/AVE appoints new chairman

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ALT:AVE appoints new chairman
Phil Shelley, chairman at ALT/AVE

Phil Shelley, a former Goldman Sachs banker and founder of Arlington Capital Markets, has been appointed to the role of chairman at ALT/AVE, a new regtech startup that uses distributed ledger technology to support document management and exchange in financial services.

Shelley has more than 23 years of experience in investment banking and is currently chairman of WH Ireland, a financial services and wealth management company. He has also been vice chairman at Barclays Investment Bank and head of UK corporate broking and equity capital markets at Goldman Sachs International. 

UK-based ALT/AVE uses distributed ledger technology to provide financial institutions with a durable medium to send regulated documents to their customers, in compliance with Financial Conduct Authority requirements.

Its flagship solution, docStribute, uses a decentralised hashgraph network known as Hedera, the only public ledger that uses hashgraph consensus, an alternative to blockchain.

Commenting on the appointment of Shelley, Chris Ansara, founder and chief executive officer of ALT/AVE, says: “We are extremely excited to have Phil join the ALT/AVE team as chairman of the board. His impressive background and breadth of industry experience will play a crucial role in enabling the company to reach its next level of success.”

“As we take on the challenge of digitising what has long been a manual and outdated process of financial institutions sending paper documents to banking customers, Phil’s role as chairman opens up new avenues of opportunity and marks a significant moment in the history of our organisation.”

Shelley adds: “I am delighted to be joining ALT/AVE at this exciting time. The team has created a product which clearly meets a pressing need for the financial services sector. It combines regulatory compliance with high levels of security and improved customer experience whilst reducing paper usage. There is much to do but the work our team has already done means we can look forward to an exciting future.”

Railsbank launches in Australia, partners with Volt

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Railsbank launches in Australia, partners with Volt

Embedded finance provider Railsbank has launched in Australia via a partnership with the country’s first neobank, Volt.

Describing Australia as “a highly strategic market”, the partnership enables UK-headquartered Railsbank to continue its expansion within the Asia Pacific and China region.

The embedded finance market in Australia is in its infancy, but both Railsbank and Volt believe it is set for rapid growth over the coming years.

Volt will also engage with Railsbank’s global network of partners and customers, and enable a broader banking-as-a-service solution in Australia that will allow companies to prototype, launch and scale financial products within their own customer experience. 

Nigel Verdon, co-founder and chief executive officer of Railsbank, says: “This deal has a personal resonance for me as one of my ancestors, Sir George Verdon, was general manager and a founding father of the ANZ Bank, so it’s good to be back in Australia again!”

“It’s very exciting to see that Australia’s fintech scene is thriving. We are ready to support all Australian business that want to innovate and capitalise on the expected exponential growth of embedded finance.”

He continued: “What we bring to the table is represented by deconstructed financial components, tools for product managers, and APIs to allow anybody to come into our toolset to access our consumers and customers for distribution.”

“These can then be reconstructed into financial use cases. This is what Apple did with iTunes. They deconstructed the music industry and changed the economics of the industry.”

“Collaborating with Volt gives us access to local knowledge and capabilities to help us succeed. This is a significant partnership for Railsbank as we continue our global expansion and strengthen our foothold in Asia Pacific.”

Justin Xiao, chief operating officer of Railsbank in the Asia Pacific, adds: “Australia is strategically important for Railsbank and it’s a real privilege for us to be partnering with Volt in this next phase of our growth. The strength of the Volt brand, balance sheet, and compliance offering makes it the ideal partner to help us launch into the local market and tap the growth opportunity in embedded finance.”

“Australia’s fintech scene is vibrant and Railsbank has a lot to offer in terms of bringing innovative solutions and best practices to customers. Collaborating with Volt gives us access to local knowledge and capabilities to help us succeed. This is a significant partnership for Railsbank as we continue our expansion in the Asia Pacific region.”

Volt founder and chief executive officer Steve Weston says: “We are proud to be the first and only bank selected to launch Railsbank’s embedded finance offering in Australia.”

“Railsbank has a proven track record of servicing millions of customers through partnerships with banks like Volt in global markets. This partnership demonstrates how our prudent and measured approach to market entry, built on the sturdy foundation of our unique BaaS platform and partnership strategy, could help to make Volt a long-term contender for a share of Australia’s highly lucrative banking sector.”

Railsbank is headquartered in the UK and has offices in Singapore, the Philippines, Malaysia, Vietnam, Sri Lanka, the US, Germany, Lithuania. Melbourne and Sydney.

It has relationships with numerous banks and financial institutions across Europe, the US, and Asia Pacific, and will continue its expansion across Asia with a view to deepening its footprint in Japan, the Philippines, Thailand and Vietnam later this year.

In November 2020, Railsbank raised US$37 million as part of continued equity funding to support its global growth and product expansion. Significant investors include Visa.

Chip appoints new chief technology officer

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Chip appoints new chief technology officer
Tom Evans, chief technology at Chip

UK-based savings app provider Chip has appointed Tom Evans as its new chief technology officer.

In this role, Evans will lead product and engineering teams with the aim of building and delivering new features, including Investments and ‘returns’ marketplace ChipX, which will offer products of differing risk levels to help users build their savings.

Evans, who joins from 10X Banking, brings more than 24 years of experience in software development and engineering. Prior to moving into the fintech space, he led engineering teams at Ocado and Amazon.

He commented: “I’m very excited to join Chip. They are building an amazing app that is delivering real benefits to our customers.”

“I’m really looking forward to scaling and shaping the product and engineering teams to meet the challenge of building great new features for our growing user base, while focusing on the highest standards of quality and reliability. Chip has a great future ahead as it enables its customers to continue to build savings, and I’m thrilled to be a part of that journey.”

Chip has been seeing significant growth as the size of the fintech company’s team tripled and its user base more than doubled in the past year.

The company plans on introducing a number of new wealth-building features in 2021, including Investments and ChipX, scheduled for spring this year. Both the engineering and the product teams, headed up by Evans, will play an integral role in bringing these features to its customer base.

Simon Rabin, founder and chief executive officer of Chip, added: “Chip is not just a business that uses technology for some of its processes—our entire business is our technology. This past year, we’ve managed to build an incredible engineering team, and now, the time has come to level up and take the next ambitious steps on our journey.

“This is where Tom comes in. He brings a wealth of experience in building engineering and product quality at Amazon, Ocado Group and Oracle, and I know he will do amazing things at Chip, too.”

Blink partners with Terrawind Global Protection for flight disruption support

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Blink partners with Terrawind Global Protection for flight disruption support
Paul Prendergast, chief executive officer and co-founder of Blink

Ireland-based insurtech company Blink is launching a major expansion of its flight disruption insurance offering in Central and Latin America this month.

Blink has partnered with Terrawind Global Protection, a provider of travel assistance solutions serving millions of customers worldwide each year, to deliver a tailor-made service to clients, whether travelling for business or leisure.

Announcing the partnership, Paul Prendergast, chief executive officer and co-founder of Blink, says: “We are delighted to be working with Terrawind Global Protection, a trusted and truly innovative company in a region that is hugely exciting for us. We were tasked by Terrawind to deliver a seamless, superior customer service experience for their clients and the result is a real-time service that provides options and alleviates stress when customers need it most.”

“At a critical time when the travel industry begins to recover and we see the increasing movement of people worldwide, Terrawind’s assistance services will play an important role in restoring confidence to the travelling public and we are proud to play our part in that effort.”

Blink offers a data-driven travel disruption solution. Once a traveller registers their flight details, the insurtech company monitors that flight in real-time. A delay or cancellation automatically results in a traveller being notified.

Terrawind Global Protection’s registered customers are offered choices that remove the stress and consequences of the delay, including airport lounge access if a flight is delayed by three hours or more, or a cash payout per traveller, which is immediately deposited into their Paypal account.

Blink will provide flight disruption support to Terrawind Global Protection policyholders wherever they are travelling worldwide.

Commenting on the partnership, Carlos Fernandez, chief executive officer of Terrawind Global Protection, says: ”This is another key element in our ongoing strategy to continually add value to our client services. 2021 is a year for optimism and for recovery.”

”By adding Blink’s flight disruption solution to our product offering, we’re affirming our confidence in the return of global travel and investing in world-class innovation to enhance the travel assistance experience for our clients. We are proud to serve a diverse client base across 15 Central and South American countries, the USA and the Caribbean and as they travel the world for business or leisure, we intend to be with them every step of the way.”

This partnership was a culmination of collaboration between Terrawind Global Protection, Blink and Rokk3r’s INSURT3CH division, a digital insurance distribution specialist.

Blink was founded in 2016 as a parametric-as-a-service insurtech startup and focused on a flight disruption travel insurance solution to prove its parametric platform.

It was acquired by CPP Group in March 2017 and went on to build and launch innovative parametric solutions for its insurance partners globally through its proprietary insurtech platform, Blink Parametric, in areas such as the climate, energy, utilities and travel risk.

SumUp raises €750 million in financing

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SumUp raises €750 million in financing

UK-based payments service provider SumUp has raised €750 million in financing to press ahead with its expansion into new markets and build its product set through acquisitions.

The financing is coming from Goldman Sachs, Temasek, Bain Capital Credit, Crestline, and funds managed by Oaktree Capital Management, in a round that was described by SumUp as oversubscribed.

SumUp will use the proceeds to accelerate its growth and continue to acquire and support its existing merchants in 33 markets across the world. The new funds will also be used to continue expanding SumUp’s product suite, both organically and through further acquisitions, as well as for refinancing existing debt facilities. 

The company, which enables businesses to receive payments quickly and simply, in-store and online, recently acquired point of sale software providers Goodtill and Tiller. These acquisitions will put SumUp into contact with potentially millions of new customers, from cafes and restaurants to sports stadiums and concert arenas.

It also recently completed the acquisition of the core banking system provider Paysolut, as part of its strategy to build up its offering of banking services for merchants.

SumUp has entered 2021 in its strongest position to date. Over the past year, the company has unveiled a host of new solutions and innovations to help businesses navigate the operating restrictions brought about by lockdown.

This included the introduction of payment links and invoicing options, new online selling functionalities through the SumUp Online Store, and gift card collaborations with Google, Facebook, and Instagram.

In the year ahead, SumUp is looking to grow its 2000+ strong team by adding talent to its 19 international offices on three continents. In addition to prominence in Europe, the US, and Brazil, the company’s long-term trajectory will include expansion into Asia.

In Europe, SumUp has launched in Romania, bringing the number of its European markets to 29.

Within its new markets, SumUp acquired the full stake in the joint venture it previously had with Chile’s BancoEstado and will continue serving merchants and developing the market further exclusively under the SumUp brand.

The Colombian market launch is also a hugely significant step for SumUp, with the fourth largest economy in Latin America and a population of more than 50 million people now able to come into contact with the company’s technology.

With thousands of merchants joining the SumUp services every day, its proprietary card terminals are relied upon by more than three million businesses globally. 

Marc-Alexander Christ, co-founder at SumUp, comments: “Each day I continue to be impressed by how the SumUp team has faced down the challenges of the past year and continued to deliver the vital, payments technology that empowers small businesses all over the world; helping them to continue to be successful doing what they love best.”

“As one of the fastest growing technology companies in the world, this cash injection—in addition to having the built-in option to expand the financing—will significantly accelerate the growth of our customer base, enhance SumUp’s technology leadership position, and drive the development of new services to support our merchants globally.”

Tom Maughan from Bain Capital Credit adds: “We’re proud to be backing SumUp once again and we recognise the truly impressive strides made by the company over the past couple of years.”

“We have huge admiration for what SumUp is doing for small businesses across the world in helping them to keep trading and flourishing in some of the most trying economic circumstances imaginable. The doubling down of our investment in SumUp in this round is both a demonstration of our confidence in the company today and its strong future.”

Planixs lands Santander in major liquidity management contract win

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Planixs lands Santander in major liquidity management contract win

Planixs, the provider of real-time, intraday cash, collateral and liquidity management solutions, has landed a major client.

Santander, a global systemically important bank (GSIB), will use Planixs Realiti to improve its liquidity management processes, including cash management, liquidity forecasting and risk mitigation.

The bank needed a strategic partner and solution that would allow it to obtain real-time visibility at scale over its balances, cash positions and liquidity usage.

This would allow Santander to proactively manage payment flows and optimise liquidity buffers, while also automating processes to mitigate the risk and overheads associated with time-consuming, laborious manual tasks.

After thoroughly reviewing Realiti and hearing first-hand from other banking firms that are seeing significant benefits from the software, Santander selected Planixs as its real-time solution provider, opting for the Intraday Liquidity Management, Funding & Forecasting and Intraday Reconciliation modules to improve its processes and digitally transform its treasury operations.

The modules selected will allow Santander to achieve its goals of obtaining real-time insight into liquidity positions and detailed analytics and forecasts of end of day projections for all accounts.

Due to the Covid-19 pandemic, one of the key drivers in selecting Planixs Realiti was to mitigate risk and provide the option for staff members to safely and securely share data and information while working remotely.

With operating models changing overnight and working from home becoming the norm, the inherent operational risks in legacy processes have only been highlighted, along with the fact that manual processes that are normally conducted in person, in the office, would no longer be fit for purpose.

As Realiti can be hosted and delivered as a software-as-a-service (SaaS) solution, staff members will now be able to log on and access and share data from home, while also ensuring the utmost security.

Santander has also identified Realiti as business critical. Consequently, the bank required a SaaS deployment option that provided a highly resilient solution with recoverability built in. As a result, Realiti will be deployed using Amazon High Availability Zone to mitigate both component and site failure.

Commenting on Santander’s decision to select and rollout Realiti, Ross Morgan, head of department for treasury middle office and operations, says: “We are very excited about deploying Realiti and experiencing the benefits across our liquidity management processes. Furthermore, we are really pleased to have found a strategic partner in Planixs that we can work with to transform our treasury operations.”

Neville Roberts, chief executive officer of Planixs, comments: “Santander is one of the largest banks in the world—one that is recognised globally and with GSIB status—meaning it is subject to increased regulatory pressures. Realiti has been designed for such banks, to provide firms with real-time insight and anywhere access, allowing them to improve their cash and liquidity management processes and meet regulatory compliance.”

“We are delighted to have been selected by Santander to help the bank meet its treasury objectives and look forward to a long working relationship with the organisation.”

Planixs has enjoyed significant success since it launched the Realiti real-time cash, collateral and liquidity management solution.

Current Realiti users include SIX Group, Banque Internationale à Luxembourg, Lloyds Banking Group, Landesbank Baden-Württemberg, Scotiabank, Deutsche Bank, Ghana International Bank and Zenith Bank.

Starling Bank lands £272m in funding, achieves £1.1b pre-money valuation

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Starling Bank lands £272m in funding, achieves £1.1b pre-money valuation

Starling has completed a £272 million series D funding round that gives the digital bank a pre-money valuation of £1.1 billion.

Fidelity Investments led the funding round, alongside Qatar Investment Authority, RPMI Railpen, the investment manager for the £31 billion Railways Pension Scheme, and global investment firm Millennium Management.

Starling is among the UK’s fastest-growing banks. Since launching in 2017, it has opened more than two million accounts, including more than 300,000 small business accounts.

The digital bank’s total gross lending now exceeds £2 billion, while deposits top £5.4 billion.

The new funding will support Starling’s continued rapid and now profitable growth. The capital will be deployed primarily to support a targeted expansion of lending in the UK, as well as to launch in Europe and for anticipated mergers and acquisitions.

Anne Boden, founder and chief executive officer of Starling Bank, says: “Digital banking has reached a tipping point. Customers now expect a fairer, smarter and more human alternative to the banks of the past and that is what we are giving them at Starling as we continue to grow and add new products and services.”

“Our new investors will bring a wealth of experience as we enter the next stage of growth, while the continued support of our existing backers represents a huge vote of confidence.”

The announcement comes as Starling booked its fourth successive month in profit. The digital bank is on course to report its first full year in profit by the end of its next financial year-end.

Starling generated a total revenue of £12 million in January 2021, which represents an annualised revenue run rate of approximately £145 million and an increase of approximately 400% compared to January 2020.

Gross operating costs remain broadly flat with account numbers having almost doubled year-on-year to more than two million.

#IWD2021: Mel Tsiaprazis of Nivaura on excelling in fintech

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Mel Tsiaprazis of Nivaura on excelling in fintech

International Women’s Day is a very special day for many. I hold it close to my heart, not just because it’s also my birthday(!), but because it is a day to reflect and celebrate our achievements and those of women around the world. 

I grew up without access to basic financial services and am immensely proud of my journey from there to leading operations at an industry-disrupting fintech. Getting here took a huge leap of faith.

One day, I packed my suitcase and flew to London from Australia as a first generation Greek woman with no job lined up. My personal circumstances growing up, and many brave steps in the dark since then, led me to identify my personal mission: to support founders who are driving financial inclusion and societal advancement in regions without access to services that are common in more developed economies. Sadly, 56% of all those without a bank account are women. This makes my mission all the more important to me, and especially today. 

It is this mission that found me at Crown Agents Bank, a UK regulated provider of wholesale foreign exchange and cross-border payment services across frontier and emerging markets. I truly believed in the mission this organisation had set for itself but was astounded to learn that all their processes remained fully manual.

My time at the bank was spent leading a successful digital transformation programme that achieved 70% robotic process automation. As a result of this work, the bank was able to provide a greater breadth of services far more efficiently to its customers across emerging markets, driving financial inclusion. 

Mel Tsiaprazis - Nivaura
Mel Tsiaprazis, chief operating officer at Nivaura

From there, I stepped into my role at Nivaura, the only company to be digitising the capital markets workflow, end-to-end. Upon understanding that capital markets broadly remain the exclusive stronghold of established corporations and their services, joining the Nivaura team was a natural next step in my mission. 

Due to the high cost of capital acquisition, many small- and medium-sized businesses are excluded from this form of financial service, despite the fact that it could aid their corporate growth and fuel great ideas. The democratisation of capital markets will enable the provision of capital to all organisations. Access will drive company growth and fund great ideas that will ultimately improve our world. 

I recognise that taking Nivaura from a startup to a successful scale-up and driving its commercial expansion into Asia and Latin America, are huge achievements. All too often we don’t take the time to reflect on far we’ve come. 

I keep myself on track by recognising there are moments to be brave (because everything is possible if you believe), take advantage (I stumbled into fintech on the back of an international business and marketing degree and have since topped this up with my Harvard Business MBA), and knowing you’re enough (because the best version of yourself is unedited by others’ expectations).

I want to leave the reader with a thought. There is still a long way to go before women and individuals from any minority group are given equal opportunities as standard. This will only come when true diversity of thought is prioritised as a business strategy. But if I can set myself a mission and achieve all that I have, overcoming the challenges along the way, then so too can you.

What is your mission? Say it out loud, write it down, and set a plan for achieving it. Arm yourself with the values of being brave, taking advantage of opportunities, and knowing you are enough! And of course, find yourself a network of supportive colleagues and mentors. 

I hope you can all take a moment to reflect on all you have achieved so far on this International Women’s Day.

#IWD2021: Sahar Salama of TPAY MOBILE on building a business in fintech

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After a successful career with technology and telecommunications companies, including Link Development, LinkdotNet, and Digitaltest, I decided it was time for a change; time to apply all my experience in digital transformation, platform, and product to my own venture.

In 2014, I founded TPAY MOBILE—a full-service mobile payments platform that gives local and global digital service providers access to consumers in the Middle East, Africa and Turkey. I believe in increasing access to digital goods and services to consumers that do not have access to traditional banking infrastructure. I also saw an opportunity to simplify the complex processes that underpin cross-border mobile payment acceptance across the region. The two married perfectly. 

Seven years on, I’m extremely proud of what TPAY MOBILE has achieved. We currently enable 14 million monthly users to purchase digital goods and services without the need for a credit or debit card, by using their phone number as core. In addition, our cross-border mobile payment platform enables rapid business growth for merchants across the globe. 

While I highly recommend a career in fintech to women, I am also very alert to the fact that women make up just 7% of fintech founders. This challenge isn’t only for senior leaders, either; we see this gender disparity at all levels of the fintech community. The European tech ecosystem does not provide equal opportunity for people of all demographics, backgrounds, and experiences—that’s the verdict of 86% of people surveyed for Atomico’s State of European Tech report in 2020. 

Last year, Crunchbase reported that 20% of newly funded startups in 2019 had a female founder. While the proportion of female co-founded companies has doubled since 2009, when it stood at 10%, this does not signal a big enough shift in the sector.  

Sahar Salama - TPAY MOBILE
Sahar Salama, chief executive officer and founder of TPAY MOBILE

So while there have been positive strides toward gender parity in fintech, it remains clear that, for women, and indeed for other overlooked groups, there are still huge inclusion gaps. How do we actively change this? How do we encourage a more diverse pool of talent into our industry? I argue that we should focus on attracting talent, and, crucially, retention strategies for diverse backgrounds. This includes promoting an inclusive work culture, ensuring there are equal promotion opportunities for both men and women, and offering mentoring and professional development. 

My biggest piece of advice for women who, like me, want to lead their own fintech firm, is to have confidence. I come from Egypt, where there are many women working in tech and prominent female leaders across the political, social and business arenas. I owe much to their legacy of success, which laid the groundwork for me and always made me feel like I belonged in the tech sector.

When I began working with organisations across the globe, I became aware of how underrepresented women are in this industry. I’m incredibly grateful that I remained unaware of the gender imbalances in fintech in the early days of my education and career. It meant that when I did come to understand the scale of the issue, and in turn, how it might affect me, I already had a strong drive to succeed that was unaffected by others’ perceptions. Our aim should be for every young woman to grow up with that self-belief and drive.

There is still much progress to be made to solve the challenges of gender disparity in fintech. As we mark International Women’s Day, I can be optimistic about the future—provided the rest of the industry stands with me to enact positive change.

#IWD2021: Amanda Mesler of CashFlows on running a successful fintech business

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Amanda Mesler of CashFlows on running a successful fintech business

Today, as on every International Women’s Day, I take some time to reflect on where I’ve been and, most importantly, where I’m going. 

My expertise is in driving digital transformation and growing businesses at pace, and it’s something I’m proud of. One of the highlights of my career so far was successfully scaling Earthport, a cross-border payments business, until it was acquired by Visa, which won Tech Deal of the Year in the 2019 UK Tech Awards. By the time I joined Cashflows as chief executive officer in 2019, I already had a clear understanding of the three key elements to running a successful business: having the right people, maintaining focus, and embracing transformation. 

On today, of all days, it makes sense to focus on people. It is really important to me that the Cashflows team reflects the diversity of our customers and partners—50% of whom are women. My opinions on how this should work in practice in businesses has changed over the years. In my early years in the fintech industry, even when I was the lone woman in an unfriendly boardroom, I did not believe in quotas of any kind. I firmly believed that meritocracy would always win out. Since then, I’ve learned two key things. 

Amanda Mesler - CashFlows
Amanda Mesler, chief executive officer at CashFlows

First, that diversity of thought is absolutely crucial to a business being successful, and second, that this won’t just happen on its own. We need to be proactive; we need to actively ensure that we’re creating corporate environments with diversity of thought and ideas.

One of my first actions when joining Cashflows was transforming our team to be reflective of our expertise as a company. I took a hands-on approach in our hiring process, ensuring that our team consists of industry experts who offered a different perspective. As a business, you have to ensure that you are surrounded by people who are prepared to roll up your sleeves and get involved with everything from strategy to tactics. In my opinion, this isn’t attainable without a team you trust.

I have spent my career advocating for women in an industry dominated by men. I’m proud to say that this advocacy can be seen in practice within my own teams. Two thirds of Cashflow’s senior leadership team are female, and during my time at Earthport, 50% of the executive team were women.

There are clear commercial benefits, too. Research shows that companies with at least one woman on the board perform 26% better than those with male-only boards. If that doesn’t incentivise other companies in the fintech industry to be as proactive as Cashflows, I don’t know what will!

As we near the end of Q1 2021, I’m genuinely optimistic about the future of gender diversity in fintech. The right things are being said, and the right initiatives are in place. We just need to do more, faster.

Meniga launches carbon footprint tracker, Íslandsbanki first to roll it out

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Meniga launches carbon footprint tracker, Íslandsbanki first to roll it out
Georg Ludviksson, chief executive and co-founder of Meniga

Meniga, the provider of personal finance banking solutions, has partnered with Íslandsbanki, one of Iceland’s largest banks, to launch its new innovative green banking solution, Carbon Insight.

The partnership will enable Íslandsbanki’s mobile banking app users to track their carbon footprint.

As part of the agreement, Íslandsbanki will integrate the Carbon Insight solution into its digital banking offering, which will help drive customer engagement, boost loyalty and create a more robust environmental, social, and governance (ESG) strategy.

Meniga’s Carbon Insight solution will provide Íslandsbanki customers with:

  • An estimate of their overall carbon footprint based on their spending profile, broken down into spending categories and time periods
  • A broad understanding of the specific aspects of their spending that are the most detrimental to the environment
  • The necessary information and knowledge to alter their spending behaviour, boost their personal savings, and crucially, help save the planet

As worldwide anxiety around climate change continues to grow, many banks are recognising the unique opportunity they have to serve the needs of the rapidly growing segment of carbon-conscious consumer, according to Meniga.

A recent survey conducted by Meniga revealed that 80% of consumers experiencing its technology now want to use their banking apps to help them estimate their carbon footprint.

Georg Ludviksson, chief executive and co-founder of Meniga, comments: “With more and more people around the world growing anxious about the consequences of climate change, the need for solutions and initiatives that empower people to take action to help protect our planet has become a business imperative.”

 “As custodians of our personal finance data, banks are in a unique position to play a key role in helping the rapidly growing movement of carbon conscious consumers make informed choices in their daily consumption.”

“We have seen great enthusiasm for our Carbon Insight product over the past few months, from banks and other key financial players, which is an encouraging sign from our industry that more green initiatives are still to come. For our part, we’re extremely proud to be leading, alongside Íslandsbanki, in the green banking movement and the industry’s fight against climate change.”

Birna Einarsdóttir, chief executive officer of Íslandsbanki, comments: “Consumers are increasingly interested in reducing their carbon footprint and having a positive impact on the environment. Meniga’s Carbon Insight solution will enable Íslandsbanki’s customers to estimate the carbon footprint of their private consumption, identify carbon intensive  purchases and ultimately reduce their carbon footprint while saving money at the same time.”

Insurtech firm Beam Dental raises $80 million

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Insurtech firm Beam Dental raises $80 million

Beam Dental, a digital-first dental insurer that rewards its members for good dental hygiene, has raised $80 million in an oversubscribed series E funding round.

The round was led by Mercato Partners’s growth equity fund, Traverse, with participation from new and existing investors, including Drive Capital, Georgian, Nationwide, and Breakout Capital. The round brings Beam’s total funding to more than $160 million.

Beam is simplifying the dental insurance industry for members, brokers and employers by using data, machine learning and technology to deliver more accurate custom quotes, better customer service through a digital platform, and lower insurance rates.

Members who use Beam’s connected toothbrush may earn lower insurance rates based on their dental hygiene as well as incentives to maintain better wellness overall.

Beam’s brush programme has produced more than 100 million brushing minutes to date, helping employers control their insurance costs and helping members earn rewards.

The insurtech firm has grown to 250 employees since launch in 2012, expanded to serve employers in 41 US states and increased its dentist network to 400,000 access points in all 50 states.

Beam has grown revenue by 600% over the past three years, with a net revenue retention rate of 100%. It doubled its member base in 2019 and again in 2020.

Alex Frommeyer, chief executive officer and co-founder of Beam, says: “At Beam, our vision is to modernise dental insurance by making it simpler and more intelligent. Our dental offering completely changes the way employers of all sizes think about dental wellness, by encouraging their employees to take better care of their teeth and making it easier to take a more proactive role in their dental care.”

Beam will use the funding to expand its offering to new markets, onboard additional employee benefits brokerages and add products.

Joe Kaiser, director of Mercato Partners, says: “As the only digitally native dental insurance company, Beam leverages technology to promote better overall health for its members and provide more accurate benefit pricing for its employers. Since its inception, Beam has driven innovation in the dental industry and enhanced the digital experience for its members, employers and brokers.”

2021: the dawn of better business banking?

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2021 - the dawn of better business banking 1

It was inspiring to see how small businesses responded to the new and changeable restrictions in place due to the coronavirus pandemic. They adapted quickly to help customers in new ways, demonstrating their versatility, creativity and tenacity.

While banks were initially held back by regulation and legacy infrastructure, in crisis mode they accelerated digitalisation plans and joined forces with third parties to deliver essential solutions to their customers as quickly as possible. Priorities and budgets were shifted overnight to provide the best possible customer experience. It was far from easy, but the pandemic helped banks find the motivation they needed to future-proof their processes and solutions through collaboration.

According to research we commissioned last November, the pandemic caused 58% of banks to change their IT infrastructure plans. In collaboration with fintechs and specialist providers, banks have been able to deliver new digital accessible solutions to meet the needs of their retail and corporate customers. Now, looking ahead to what 2021 holds, the new challenge is to ensure the innovation and collaboration that became necessities in 2020 become the norm, not a passing phase or memory. 

Future-proofing

We spoke to 300 C-suite decision makers at banks across the UK, DACH (Germany, Austria and Switzerland) and Benelux (Belgium, the Netherlands and Luxembourg) to discover the specific challenges they face in future-proofing their organisations and enhancing customer propositions. Published in a whitepaper, ‘Better business banking: Collaborating for success’, the research reveals that existing IT infrastructure is the biggest internal challenge holding banks back from achieving their business objectives.

A few other key take-aways from the November research:

  • Lack of integration with customer-facing departments was a key issue for 40% of banks
  • High customer expectations is the most common external focused difficulty faced by banks with 39% saying this was one of their top three challenges
  • Working from home operations, an area where Covid-19 has changed priorities for individuals, businesses and banks across Europe, came in a close second, with 38.7% of banks placing it in their top three

Unencumbered by legacy systems, the new cohort of fintechs have been able to serve consumer and corporate customers efficiently and at low cost in many areas, often competing with traditional banks. But the incumbents have not stood back and accepted defeat as inevitable; instead, they have been changing their business practices, culture and technology to remain competitive and provide the solutions their customers need for today and tomorrow.

Building for the future, together

2021 - the dawn of better business banking 2
Anders la Cour, chief executive officer at Banking Circle

Now, more than ever, banks need to find cost-effective ways to support corporate customers whatever the future post-pandemic world brings. That support needs to be convenient, accessible and, above all, valuable. Solutions must be investment light yet deliver strong innovation flexible enough to meet rapidly shifting expectations and needs. 

Last year brought an increasing trend towards collaboration. Now, to meet the evolving business needs, collaboration must be embraced to bring benefits for all sections of the financial services sector. Through partnerships with infrastructure providers banks gain the agility and innovation of a fintech, while fintechs gain compliance and security processes, enabling them to focus on building strong customer relationships.

Now is the time to reap the benefits. In the face of unprecedented challenges, banks stepped up and set a new precedent for future-proofing banking. And that must be the legacy of 2020: better business banking.

To register for the new Banking Circle whitepaper, visit bankingcircle.com/whitepapers.

UK publishes Kalifa Review of fintech ecosystem

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UK publishes Kalifa Review of fintech ecosystem

The UK has published the much-anticipated Kalifa Review of the jurisdiction’s fintech ecosystem.

The Kalifa Review, named for its author, Ron Kalifa OBE, provides a clear strategy and delivery plan to ensure the UK can capitalise on the opportunities fintech presents, according to Innovate Finance, which provided the secretariat for the independent evaluation, alongside the City of London Corporation.

The review highlights the opportunity to create highly skilled jobs across the UK, boost trade and extend a competitive edge over other leading fintech hubs. Recommendations include:

  • Introducing a new ‘fintech scale-up’ visa route for specialists from around the world;
  • Implementing a ‘scale box’ to provide regulatory support for growing firms;
  • Improving UK listings rules with free float reduction and dual class shares;
  • Creating a £1 billion fintech growth fund to help firms grow independently; and
  • Establishing a private sector-led Centre for Finance, Innovation and Technology to support national coordination and growth in fintech across the UK.

Commenting on the review, Charlotte Crosswell, chief executive officer of Innovate Finance, says: “Innovate Finance welcomes the timely contribution of the Kalifa Review. This is a vital intervention that has the potential to set the strategic direction of UK fintech for decades to come.”

“The sector has seen incredible growth, and fintech firms across the UK are ambitious in building, developing and scaling their businesses. The way that consumers and businesses are interfacing with financial services is rapidly evolving. We must respond to this changing dynamic and ensure we look to the fintech sector to advance these solutions. This will result in the creation of new digital jobs, inspire a next generation of entrepreneurs, and in turn enable the growth of global champions.”

“The UK attracts the founders behind some of the world’s most innovative businesses, so we must show that we remain an ambitious partner in a sector where we have been at the forefront of global thought leadership. We look forward to supporting the implementation of Ron Kalifa’s recommendations and strategy over the coming months.”

UK publishes Kalifa Review of fintech ecosystem - Jimmy Williams
Jimmy Williams, chief executive officer of Urban Jungle

Jimmy Williams, chief executive officer of insurtech firm Urban Jungle, called the recommendation for the creation of a £1 billion fintech growth fund potentially the Kalifa Review’s “most impactful proposal”.

Williams says: “Currently, most fintechs are forced to look outside of the UK for funding when they get to a bigger scale. Typically, they seek investors in the US, where pockets are deeper. Having a major fund in the UK would be very beneficial and would mean the very biggest companies had more chance of remaining in the UK.”

“Fintech businesses tend to operate in massive markets with huge opportunities to scale, but their journey there can also be capital intensive. Further support through tax efficient schemes to bring more fintechs to market would definitely help the health of the ecosystem.”

As investors flock to fintech, Qatar stakes its claim

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As investors flock to fintech, Qatar stakes its claim

Investors poured $30.4 billion into fintech companies globally in the first nine months of 2020, according to the Qatar Financial Centre and Refinitiv—and Qatar is making its pitch to increase its share.

Although the Middle East and North Africa (MENA) region accounted for less than 1% of global investments in 2019, the figures suggest the region is becoming increasingly attractive for investors.

The Qatar Fintech Report 2021 highlights the exponential growth of global fintech investments from just under $ 1 billion in 2008 to an estimated $34.5 billion by the end of 2019.

Despite jarring global economic uncertainty and financial market volatility brought on by the Covid-19 pandemic, fintech investment levels globally remained relatively stable during the first nine months of 2020.

The largest investments were in payments, securing a quarter of venture capital funding, followed by digital banking and capital market solutions. The Qatar Financial Centre says Qatar’s current strategic fintech interests are closely aligned to those areas.

Within the MENA region, 70% of fintech investment went to the United Arab Emirates in 2019 (the most recent year with data over 12 months) followed by Bahrain.

Qatar is also accelerating the development of its fintech ecosystem. 

The global outbreak of the Covid-19 pandemic came as a wakeup call for traditional financial institutions in MENA markets and spurred growth opportunities in Qatar and elsewhere. In particular, the pandemic accelerated the implementation of digitalisation strategies in Qatar’s financial marketplace.

Nadim Najjar, managing director for theMiddle East and Africa at Refinitiv, says: “Although this funding performance indicates significantly slower fintech adoption in the region, it is also a sign of substantial untapped potential, especially in the Gulf.”

“Key drivers for fintech solutions in the Gulf include above average GDP per capita, high internet and online payment penetration, as well as shifting consumer preferences away from traditional financial institutions.”

Yousuf Mohamed Al-Jaida, chief executive officer of the Qatar Financial Centre, says Qatar stands ready to support “new opportunities for financial innovation, which has attracted an influx of tech and fintech companies seeking to set up operations in Qatar”.

Al-Jaida continues: “The country offers fintechs worldwide substantial opportunities domestically as an unsaturated market with ICT spending expected to reach $9 billion by 2024, boosting the competitiveness of its market and strengthening its position to emerge as a fintech hub in the region.” 

“Qatar has made remarkable progress in the fintech space in a very short time. Several major developments have taken place in the last year, including the launch of Qatar’s National FinTech Strategy, the Qatar FinTech Hub (QFTH) and its incubator and accelerator programmes, as well as the Qatar Financial Centre (QFC) Fintech Circle and Tech Talk series to buttress the local ecosystem.”

Orka raises £29 million to expand earned wage access product

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Orka raises £29million to expand earned wage access product

Worker technology startup Orka Technology Group has raised £29million in its latest funding round and plans to use the capital to fuel the rapid growth of its earned wage access product, Orka Pay.

The fundraise was a mixture of debt financing from Sonovate and equity funding involving the British Business Bank Future Fund and existing investors, including former UK chief executive officer of Adecco Peter Searle. This takes the total raised by Orka to £31.5 million since the company launched in 2017.

As well as growing Orka Pay, the UK startup will use the funding to double its headcount to 50 in 2021 and invest in its full portfolio of solutions for shift workers, which also includes the company’s flagship product, labour-as-a-service platform Orka Works.

Orka believes it can cater to the shift towards flexible employment taking place across many industries and with Orka Pay, aims to capitalise on the growing demand among businesses and workers for flexible pay options.

Launched last year, Orka Pay enables shift workers at partner organisations to withdraw up to 50% of their wages as soon as they have earned them, providing an alternative to high-interest loans and credit card debt.

The company’s first product, Orka Works (formerly Broadstone), allows workers to quickly and easily find fair and flexible temporary employment with large organisations working in traditional, regulated industries such as security, cleaning and logistics.

It is used by more than 50,000 people in the UK to find work, saw 150% year-on-year revenue growth in Q3 of last year and counts G4S and ISS as clients. This year, the company will launch its third core product, Orka Check, to improve the process for worker background checks.

Tom Pickersgill, co-founder and chief executive officer of Orka, says: “What we’re doing is unique in this sector, and thanks to this funding, we’ll be able to reach many more businesses and their employees in the coming year—and improve the service that we can offer them.”

“The worker landscape has changed dramatically over the past decade. More people are looking for work that fits around their life and want the entire process to be less onerous. Our success since launching proves that there is real appetite amongst businesses and employees for an innovative alternative to the traditional recruitment, onboarding and payment model, saving both time and money.”

Searle adds: “Having followed Orka’s journey closely for a few years now, it’s clear that this is a company truly shifting the dial up when it comes to temporary work. They have rightly identified an important gap in the market, as more people seek out flexible employment that fits around their lifestyle, and they have unquestionably established themselves as a leader in worker tech. I’m very excited to be supporting them as they enter their next stage of growth.”

Judging for UK, European, US and Asia FinTech Awards to commence soon as entry deadlines near

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Judging for UK, European, US and Asia FinTech Awards to commence soon as entry deadlines near

The 2021 independent judging panels for the UK, European, US and Asia FinTech Awards have been confirmed.

The news comes with a week to go until the entry deadline of 26 February. Remember, all that is required to enter is a written submission of between 250 and 1,000 words, or a three-minute video.

Judges for all four events will meet virtually on 12 March, following the entry deadline. Each group will be led by a chair, who will spearhead discussions on entries, scoring, the shortlist and winners.

Phil Vidler, chief executive officer of digital engagement platform FinTech Alliance, is chairing the UK FinTech Awards 2021 judging panel.

He will be joined by Dr Naseem Naqvi (British Blockchain Association), Jana Mackintosh (UK Finance), James York (Insurtech UK), Stephen Ingledew (FinTech Scotland), Will Thorne, Sarah Williams-Gardener (FinTech Wales), and Hugo Rousseau (techUK).

The winners for the UK FinTech Awards 2021 will be announced during an in-person ceremony on 20 May at Leonardo Royal London St Paul’s.

Maria Staszkiewicz, president of the European Digital Finance Association, an independent industry body that represents the digital finance community, will oversee judging for the European FinTech Awards 2021.

Her fellow judges include some of the continent’s best experts in fintech and financial services. 

They are Robrecht Vandormael (Payments Europe), Louise Grabo (Swedish Fintech Association), Thaer Sabri (Electronic Money Association), Anders Norlin (Findec), Gunnlaugur Jónsson (Icelandic Fintech Cluster), Thomas Krogh Jensen (Copenhagen FinTech), Wim Mijs (European Banking Federation), and Rodrigo Garcia de la Cruz (Spanish Association of FinTech & InsurTech).

Michelle Tran, co-founder of NYC FinTech Women, is chairing the US FinTech Awards 2021 judging panel.

Her organisation, NYC FinTech Women, is a 6k+ community of leading females in fintech.

Tran will be joined by a panel of technology and financial experts from across the US, with fintech hubs in multiple cities and states represented.

They are Lisa Iagatta (ISITC), Maria Gotsch (Partnership Fund for New York City), Todd Thibodeaux (CompTIA), Kelly Fryer (FinTech Sandbox), David Gritz (InsurTech NY), and George Vukotich (FinTank).

Chairing the Asia FinTech Awards 2021 judging panel is Helene Li, general manager of the FinTech Association of Hong Kong.

Li is a seasoned management consultant and finance industry professional, who is a known influencer and key opinion leader in fintech and digital transformation.

Joining Li on the judging panel are experts from across the region, including Mohammad Ridzuan Abdul Aziz (FinTech Association of Malaysia), Chia Hock Lai (Singapore FinTech Association), Rajkumar Kanagasingam (FinTech Association of Sri Lanka), Rebecca Schot-Guppy (FinTech Australia), Chih-Shan Luo (FinTechSpace Taiwan), and Norbert Gehrke (Tokyo FinTech).

The European, US and Asia FinTech Awards will be broadcast online at the end of April 2021, with a view to becoming in-person events in 2022.

The entry deadline for all four events is 26 February 2021. All that is required to enter is a written submission of between 250 and 1,000 words, or a three-minute video.

Twenty-five categories will recognise the full spectrum of fintech products, services and solutions, as well as company achievements and the innovation and commitment of leading individuals.

Billhop raises €4 million as enterprises flock to invoice payment solution

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Billhop raises €4 million as enterprises flock to invoice payment solution
Billhop co-founders Sebastian Andreescu (CEO), Ingemar Sjögren (CFO) and Erik Malm (CTO)

Swedish working capital fintech Billhop will develop its product set and strengthen its sales, marketing, and customer support functions after securing €4 million in series A funding.

The round, led by financial technology venture capital firm Element Ventures, follows a period of rapid growth for Billhop, whose payment service enables enterprises and individuals to pay any invoice by credit card.

Billhop’s service is being utilised by more than 50,000 European companies. Since the introduction of its enterprise offering in January 2019, transactions have accelerated by 500% to-date, while the total number of transactions processed across all customer segments exceeded €270 million in 2020.

Michael McFadgen, the partner at Element Ventures who led the investment in Billhop, comments: “We set up Element Ventures to find companies just like Billhop. Those fintech firms with a strong focus on B2B and whose technology has the potential to revolutionise the way businesses operate.”

“Billhop has already made fantastic progress helping their customers efficiently access financing and liquidity, having grown organically since launch, and it will prove even more crucial as businesses of all sizes navigate the turbulent market conditions ahead. We’re thrilled the team chose to partner with us and we’re excited for what’s to come.”

Sebastian Andreescu, chief executive officer and co-founder of Billhop, adds: “We are very pleased to have the backing of Element Ventures and look forward to working with Michael, whose experience and knowledge within the financial sector will be a valuable resource for Billhop.”

“The new capital will enable our accelerated growth plan which entails expanding the team, increasing our market footprint, and further developing and improving our solution for European businesses of all sizes.”

BNY Mellon plans new solutions in digital assets and collateral management

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BNY Mellon plans new solutions in digital assets and collateral management

BNY Mellon will develop new solutions and capabilities for digital assets and collateral management under plans announced this month. 

The custody bank has launched a new enterprise unit dedicated to digital assets, while a partnership with Google Cloud will see BNY Mellon build collateral management and liquidity solutions on its platform.

Its digital assets unit, which will be led by Mike Demissie, head of advanced solutions at BNY Mellon, is developing a client-facing prototype of a multi-asset digital custody and administration platform for traditional and digital assets. The bank expects to launch this later in 2021.

Roman Regelman, chief executive officer of asset servicing and head of digital at BNY Mellon, says increasing client demand for digital assets, maturity of advanced solutions and improving regulatory clarity “present a tremendous opportunity for us to extend our current service offerings to this emerging field”.

Demissie adds: “The digital assets unit plans to deliver a secure infrastructure for transferring, safekeeping and issuing digital assets. Consistent with our open-architecture approach, the unit will leverage BNY Mellon’s digital expertise and leading technologies from fintechs and other collaborators to speed up product development and help our clients tap into the best available solutions in the market.”

‘Helping to transform the US treasury market’

BNY Mellon’s partnership with Google Cloud will leverage data analytics, artificial intelligence (AI) and machine learning technologies to develop new collateral management and liquidity solutions.

The bank says the collaboration is the latest example of its open-architecture approach of working together with leading technology providers to extend its capabilities in reimagining and delivering solutions to meet client needs.

In addition to creating use cases for the US treasury market, BNY Mellon is developing AI-powered solutions for securities lending, liquidity forecasting, dynamic controls for pricing, anomaly detection for transactions, and automated document processing.

Brian Ruane, chief executive officer of BNY Mellon Clearance & Collateral Management, says Google Cloud-built solutions could help clients “predict approximately 40% of settlement failures in Fed-eligible securities with 90% accuracy”.

Ruane continues: “A settlement failure occurs when a buyer and seller fail to exchange cash and securities by the close of business on the scheduled settlement date. This prediction model could be a game-changer for market participants and is a tremendous showcase of how we are leveraging emerging technologies, such as the public cloud, to accelerate the delivery of meaningful solutions for our clients.”

BNY Mellon is using Google Cloud for its scalable data analytics capabilities and to train models on millions of trades to consider every value and factor that could result in a failure. This will help reduce client risk and create a more efficient financial market with fewer failure points and greater liquidity.

The bank is also leveraging Google Cloud to support more development environments, making code delivery quicker while reducing infrastructure costs.

Rob Enslin, president of Google Cloud, says: “BNY Mellon is building on its existing capabilities, using the latest cloud technologies to test and refine its approach to reduce treasury settlement failures, ultimately helping its clients save money and helping transform the US treasury market.”

“We’re proud to have helped BNY Mellon use our leading data analytics and artificial intelligence technologies to transform the settlement and clearing process, and set an example for the industry overall.”

Purpose Financial welcomes Allianz X as shareholder

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Purpose Financial welcomes Allianz X as shareholder

Canadian fintech company Purpose Financial is aiming to build its infrastructure for a period of prolonged growth and expand its product offering after raising €34.5 million in funding from Allianz X.

Allianz X, the digital investment unit of insurance and asset management firm Allianz, becomes Purpose Financial’s second-largest external shareholder following the dedicated funding round. It will also have a seat on the fintech company’s board of directors.

Purpose Financial was founded in 2013 and has since established three successful lines of business, including Purpose Investments, a digital asset management service for private clients and institutions. It has approximately C$10 billion in assets under management.

The fintech company also runs Purpose Advisor Solutions, a technology and service platform for independent financial advisers, which currently services approximately C$2 billion in assets, and Thinking Capital, a digital lending and fintech platform for small- and medium-sized enterprises, which has originated more C$1 billion in loans in collaboration with major banks and other partners.

On top of the investment helping Purpose Financial to build out its infrastructure for further growth and continue to expand its product offering, it’s also a first step towards a deeper strategic collaboration between the fintech company and Allianz.

Cameron Jovanovic, global head of retirement and wealth propositions at Allianz, says the partnership with Purpose Financial is “a significant opportunity”, given the current macroeconomic challenges and the growing importance of providing joint life insurance and asset management.

He adds: “Retirement is a strategic growth pillar for Allianz, and we recognise the importance of creating holistic, digitally-enabled solutions for our customers. We see the partnership with Purpose Financial as a step forward in developing the innovative capabilities necessary to tackle the broad set of opportunities and challenges in the retirement sector, both in Canada and around the world.”

Som Seif, chief executive officer of Purpose Financial, says: “We are excited to welcome Allianz X as an investor and partner in our business alongside our existing investors OMERS and TorQuest.”

“Our business has grown exponentially since founding in 2013 and we are still in the early stages of our journey to innovating within the financial services industry. This partnership will provide us with additional resources and expertise to accelerate our growth and continue to drive innovation across the financial services sector on behalf of consumers.”

Monzo to raise £50 million in new funding

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Monzo to raise £50 million in new funding

Monzo, the UK digital bank, is raising an additional £50 million through an extension of its series G funding round.

The equity funding is coming from existing investors and one new firm, San Francisco-based Octahedron Capital, according to Business Insider.

Sky News journalist Mark Kleinman says the new funding takes Monzo’s total raised during the Covid-19 pandemic to £175 million.

No new valuation of the digital bank is available, but previous funding rounds put it at around the £1.2 billion mark.

Monzo claims to have around five million customers, along with more than 500,000 business users and over 100,000 paid-for current account users.

The new funding follows the departure of founder Tom Blomfield last month. He told TechCrunch that he felt unable to turn Monzo into a “10 or 20 million customer bank and getting to profitability and IPOing it”.

Monzo was among the least optimistic UK digital banks last year, after reporting losses of £113.8 million and warning that Covid-19 could have a negative impact on its business.

Chip records a 222% increase in total user savings for January

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Chip records a 222 percent increase in total user savings

Savings app provider Chip recorded a 222% increase in the total amount put aside by savers in January 2021 compared to the same month in 2020.

Along with increased deposits, Chip also noted a sharp rise in the average user age—41 in January 2021 compared to the average age of 32 as recorded in October last year. In fact, the oldest user to join Chip this January was 93 years old.  

These are some of the trends pointing towards the maturity of Chip as a financial product. The company, which saw record growth last year, introduced a number of wealth-building features in 2020, such as Payday Put Away (PDPA), and plans to roll out investments in 2021. 

The fintech provider looked at PDPA and analysed the difference in average monthly savings for users who use the feature, allowing them to save a custom amount of money the day they’re paid, versus those who do not

Chip found that those who use PDPA end up saving 114% (or £168.47) more per month on average, which can amount to an extra £2,021.64 per year.

The financial priorities of users also reflect this trend, with savers putting money aside for longer-term, bigger financial goals. The top goals set up by Chip savers so far this year include a financial safety net, house and car deposits, clearing debt, and weddings.

Simon Rabin, founder and chief executive officer at Chip, comments: “In 2020, we not only saw a surge in user growth and a sharp increase in the amounts put aside, but we also noticed a shift in customer priorities with a greater emphasis on financial security and bigger, longer-term goals.”

“This year, we are seeing the trend continue on the same trajectory. January is notorious for being ‘the’ month for financial planning, and it’s definitely the case this year, with it being our biggest January on record.”

He adds: “As a product, Chip has matured immensely and it’s reflected in how our savers use the app—from the sharp increase in the overall amount put aside, to user goals and priorities. One thing that hasn’t changed, however, is our goal—it was and still is to enable our savers to grow their wealth.”

Working together for global bounce-back in 2021

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Working together for global bounce-back in 2021

Last year, and the early weeks of 2021, have brought a multitude of new challenges for small businesses. They responded by demonstrating their versatility, creativity and tenacity—as a result we saw inspirational innovation, collaboration and empathy that continues to benefit society as a whole.

To see the community of IT innovators rise to the Covid-induced challenges, in the face of lockdown and isolation was extremely exciting. From the mass move to home working and schooling, to the connected communities of carers for those facing isolation, the agility of information technologists has been fundamental—and heart-warming. 

Now, as we make our way out of crisis mode and tentatively begin to get back to ‘normal’ ways of working and living, we will see whether the lessons of 2020 will truly create lasting change for the better. In this context, how the global financial ecosystem has and will continue to respond to challenges created by the pandemic will be pivotal.

A pandemic of challenges

For financial services providers, the impact of the pandemic has been doubly challenging. Indirectly, as guarantors of the economic system, the last 12 months have tested financial resilience. And directly, as providers to businesses and individuals, going forward financial institutions will need to remain strong in the face of a potentially slow recovery, all while addressing the challenge of the transformation of the industry and the wider economy.  

The challenges of 2020 have undoubtedly accelerated the pace of digital transformation—across many sectors. But the difference it has inspired in financial services has been phenomenal. It is now the responsibility of all those working in the sector to ensure that the positive changes made so far are not temporary. The rise of the digital corporate bank—mirroring the digitalisation already delivered to personal customers—is certain to be a big focus in 2021, and that is long overdue.

Having been able to provide a stable and trusted foundation during an unstable and uncertain period, banks and financial institutions have given businesses and individuals confidence and support when and where they need it. Now, as a new digital economy evolves, these same organisations can influence the shape of further change, building on the efficiencies identified in 2020 as well as tackling some of the previously unresolved issues such as data security.  

The 2021 recovery

The continuing challenge is too great for one organisation to resolve. It requires a fundamental change that is only possible in partnership. Collaboration and transformation are already underway across a multitude of organisations within the industry. This will come into its own in 2021, but collaboration will be most effective where it is backed up by technology that enables agility.

Working together for global bounce-back in 2021 - Anders la Cour
Anders la Cour, chief executive officer at Banking Circle

Therefore, Banking Circle, moving to a fully clouded platform this year, is perfectly placed to support the financial institutions that have come to depend on us to underpin their services. 

Collaboration will also see partners working together more closely for best-in-class solutions and outcomes. For example, think about artificial intelligence (AI). Data-driven decision making has already been proven to deliver efficient and effective results. In 2021, the application of AI is likely to extend across a wider range of business processes. Indeed, Banking Circle’s own use of AI as part of its anti-money laundering (AML) processes has strengthened the rigour delivered to banks and payments businesses.

There is no question that there is much that is still unclear about 2021; but what is crystal clear is that nothing is certain and, therefore, flexibility and agility underpinned by proven technology will be crucial.

Barclays Accelerator in New York welcomes nine fintech startups

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Barclays Accelerator in New York welcomes nine fintech startups

Nine fintech startups are joining the 2021 New York Barclays Accelerator, powered by Techstars.

Established in 2014, the intensive 13-week programme is designed to fast-track the next generation of fintechs companies.

Participating companies will collaborate with a team of Barclays executives, the Techstars worldwide network, and industry leaders to fine-tune their business propositions and solve problems at the cutting edge of financial technology.

After three months of mentorship, the companies will highlight their progress and showcase their innovative propositions at a demo day in April.

Mariquit Corcoran, chief innovation officer at Barclays, says: “We’re thrilled to welcome our sixth New York Barclays Accelerator class. With 18 programmes completed, we have a strong history of delivering a best-in-class experience for our chosen startups, thanks to our extensive network and expertise.”

“In these exceptional times, we are committed more than ever in supporting entrepreneurs who are continuing to transform the future of financial services, and we look forward to helping them achieve their goals.”

The 2021 New York class of the Barclays Accelerator, powered by Techstars

Avenify is building better financial and career services for people in healthcare, starting with income share agreements for student financing.

Floodlight is a data platform that enables financial advisors and asset managers to understand non-financial values of their clients, and align assets accordingly.

GravityAI is a platform for enterprise product teams to explore, test, procure, and integrate third-party artificial intelligence algorithms.

Humanitru is a customer relationship management and fundraising platform for non-profits so that they can run their operations more effectively.

Julius Tech is a flexible data and analytics platform that automates the development, deployment and support of data science and machine learning applications.

LittleNewt is a tax preparation and practice management platform for firms that utilises artificial intelligence to instantly create tax returns and accurate, real-time estimates.

Migrations.ml uses machine learning to produce the next generation of financial data for the bond market.

Nossa Data is a platform for corporations to carry out environmental, social and governance reporting, data management and analytics.

Smash is a financial wellness app that creates personalised payment plans for individuals who want to free themselves of credit card debt.

The 2021 founders have ‘expertly navigated’ Covid-19 challenges

With more than 180 alumni companies and 18 programs completed to date, the Barclays Accelerator, powered by Techstars, is one of the largest single-bank-powered portfolios globally, with a valuation of more than $1.8 billion.

The companies will also be eligible for Barclays Rise Growth Investments, a fund of follow-on investment capital solely focused on accelerator participants.

The funds allow Barclays to invest up to £10 million of follow-on investment capital per Accelerator class.

Jennifer Jordan, managing director at Techstars, says: “The world has deeply changed over the past year and founders have had to pivot in unexpected and new ways.”

“The founders of our 2021 class have expertly navigated the challenges brought on by Covid-19 and continue to exhibit tenacity and focus in building their businesses. Many of them are building solutions designed to meet the needs of consumers and banks facing a rapidly evolving economic recovery. We are excited to be working alongside these founders to accelerate their growth over the next 13 weeks.”

The mentoring and advice received during the programme has led to the success of alumni companies such as Cutover, Finch and Sigma Ratings.

SDAX close to launching digital asset trading platform

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SDAX close to launching digital asset trading platform
SDAX's Jayaprakash Jagateesan, Alphonsus Chia, Khoo Boon Hui, Yun Chee Keen and Tan Chong Huat

Blockchain-based digital asset trading platform SDAX is one step closer to launch after securing initial regulatory approval from the Monetary Authority of Singapore.

SDAX is an institutional grade digital asset trading platform that uses blockchain technology to simplify and speed up traditional exchange processes, opening new fundraising and investment opportunities.

On launch, the trading platform will offer digitised debt, equity and hybrid instruments with high-quality real estate as the underlying asset class.

Chairman Khoo Boon Hui says the regulatory approval from the Monetary Authority of Singapore, known as ‘approval-in-principle’ (AIP), the trading platform is “in a strong position to attract asset owners, accredited investors and institutional investors from around the world”.

He adds: “SDAX will contribute to Singapore’s fintech sector by offering innovative solutions to raise funds and trade fractionalised and digitised assets like real estate.”

SDAX advisory panel chairman Mah Bow Tan says: “Singapore is a globally trusted financial hub with strong government support for fintech and blockchain technology, backed by a forward looking and comprehensive regulatory framework to govern digital finance. These factors will give the global market significant confidence in home-grown digital asset exchanges like SDAX.”

Investors will be required to meet the highest know-your-customers and anti money-laundering standards to access the trading platform’s 16-hour daily trading covering all major markets with T+0 settlement.

Leveraging the Ethereum protocol with an integrated custody solution, the trading platform offers easy, reliable and secure access to liquidity pools and new investment products.

The trading platform is backed by the RHT group of companies and was developed using its ecosystem of legal, fintech and professional services.

Tan Chong Huat, non-executive chairman of RHT Group and non-executive deputy chairman of SDAX, says: “The synergies between SDAX and our network of RHT professionals have enabled us to obtain the AIP within good time as well as strengthen our pipeline of projects to be listed and traded on SDAX in 2021.”

“As an agnostic platform, SDAX can attract a wider net of investors from across all financial institutions to its exchange.”

AVANT Corporation takes minority stake in UK financial analytics firm

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Japan's AVANT Corporation takes minority stake in UK financial analytics firm

Japan-based AVANT Corporation, the owner of a group of technology companies focused on accounting, planning and management, is the new minority owner of Metapraxis.

As a part of the deal, Metapraxis, a financial analytics technology firm based in the UK, and AVANT will develop and market a Japanese version of Empower, its financial performance solution. 

The Tokyo Stock Exchange-listed holding company of ZEAL, DIVA and Internet Disclosure Co, providers of accounting, business intelligence and outsourcing services for chief financial and investment officers, becomes Metapraxis’s second largest shareholder.

Metapraxis says AVANT evaluated a variety of domestic and overseas companies with a view to acquiring products and solutions through mergers and acquisitions or alliances before settling on a partnership with the financial analytics technology firm.

Simon Bittlestone, chief executive of Metapraxis, says the investment will help the firm to expand its go-to-market activities, product suite and cloud platform.

Bittlestone continues: “The opportunity to enter the Japanese market will further our ambition of becoming the global financial analytics provider of choice. Avant’s finance consolidation technology is highly complementary to Metapraxis Empower, our own analytics platform, and together we can offer finance teams a complete digital solution driving automation and improvement.”

Tetsuji Morikawa, president and group chief executive officer of AVANT, adds: “The main product of Metapraxis, Empower, is a powerful platform for planning, analysis and visualising performance within group companies and commands a strong blue-chip client base in the European and US markets.”

“Metapraxis is an organisation with innovation and teamwork at its heart, helping to realise its commitment to providing the best solutions to its customers, which are shared values with the Avant Group.”

“These shared values have led to productive negotiations as an alliance partner. Converting Empower into Japanese and providing it to the Japanese market is an important part of realising the Avant Group’s mission of ‘Spreading Accountability’. With this collaboration, Avant Group will expand its growth in the Japanese market and take a significant step toward expanding into overseas markets.”

Eurapco and B3i develop blockchain solution for mutual insurers

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Eurapco and B3i develop blockchain solution for mutual insurers

Eurapco, a strategic alliance of eight mutual European insurers, and B3i are launching Eurapco Unity, an operational solution built on blockchain infrastructure that enables the transfer of facultative risks within a network of companies.

Eurapco Unity remains a work in progress, but the solution has demonstrated its capabilities within marine insurance, where its developers decided to begin their initial work.

This work began when the Eurapco board and its chairman, Luca Filippone, asked the alliance’s general manager, Wilma de Bruijn, to identify an opportunity where blockchain could be used to benefit its members.

In response, de Bruijn created a workstream with the goal of identifying business cases across Eurapco partners where blockchain offers improvements to existing processes, encourages innovation, and helps gaining hands-on understanding of the technology.

“Trust and transparency are fundamental values we cultivate in the alliance and we needed to ensure these principles were further translated into our operations,” de Bruijn explains.

“Exploring blockchain came as a natural step in the creation of tangible and sustainable value for our partners.”

Following in-depth market and technological research, Eurapco selected marine insurance and reinsurance as areas where blockchain could bring concrete benefits by increasing transparency and security, while significantly reducing administrative effort.

In December 2020, Eurapco, together with partners Achmea, la Mobilière, Reale Group and B3i, delivered the minimum viable product version of Eurapco Unity, enabling the transfer of facultative risks in a network of companies in marine insurance.

‘We have built a great system that will open the door to many more future opportunities’

Dieter Lammertz, head of marine and fine art at la Mobilière, explains the solution’s benefits: “A new world of digitalisation has opened up for us. Documents are quickly accessed and via a chat message the transaction is transmitted to all partners. All data remains in the blockchain and cannot be altered.”

“I am convinced that we will generate considerable time savings and am already excited about what this system can achieve.”

“In future, all accounts and claims handling will also be managed with this system, saving additional time and resources. Together we have built a great system that will open the door to many more future opportunities.”

Antonio di Marzo, head of products at B3i, the global blockchain initiative owned by 21 major insurers, says: “The Eurapco alliance is pioneering the adoption of B3i distributed ledger technology (DLT) while pushing the boundaries of admin free risk transfer within a defined group of peers and competitors.”

Eurapco Unity is “just one example of a common DLT use case, and this implementation is a great showcase for other risk pools”, di Marzo says.

“Eurapco acts as a framework enabler, establishing the rules and protocols to be followed by members to cooperate and share risks in full compliance, as respective requirements are already imbedded in the protocol. With DLT removing the need for unnecessary administration, users can focus on adding value.”

John Carolin, chief executive officer of B3i, adds: “This is the first bespoke application built on B3i’s Fluidity platform, and we are pleased to see that this has significantly reduced application development time, cost and complexity, enabling us to deliver the same for further B3i partners and third-party application developers.”

Eurapco is planning to expand Unity to new business lines, smart contracts, additional insurers and much more this year, according to senior programme manager Ivan Lippa.

Minna Technologies raises €15.5 million for subscription management service

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Minna Technologies raises €15.5 million for subscription management service
The founders of Minna Technologies

Subscription management company Minna Technologies plans to widen access to its open banking technology after securing €15.5 million in series B funding.

The series B round was led by Element Ventures, with support from MiddleGame Ventures, Nineyards Equity and Visa.

Founded in Gothenburg, Sweden in 2016, Minna enables customers to manage subscription services via their bank’s app using open banking technology.

Through partnerships with European retail banks including Swedbank and ING, Minna says it has saved more than €40 million on behalf of their retail customers.

Minna has also recently partnered with Lloyds Banking Group.

The Swedish fintech company says demand for its product has escalated as a result of the growth in the subscription economy, which has increased more than 350% since 2012 thanks to the rise of online streaming, entertainment platforms, on-demand shopping platforms and app services. 

Managing those subscriptions can be time-consuming for consumers and costly for banks.

Minna’s technology reduces the burden on a bank’s call centres when it comes to dealing with customer inquiries thanks to its integration with Visa, which means it can stop payments from cards.

Banks can also benefit from Minna’s role in facilitating utility switching, providing them with an additional source of revenue.

A tool such as Minna’s also sets the stage for banks to develop their digital banking offering into a marketplace. Hosting different products and services within one ecosystem is one way to encourage customers to engage more with their bank.

The new Series B funding takes the total Minna Technologies has raised so far to more than €23 million. The funding will allow the company to scale its technology and bring its services to more customers across the world.

Joakim Sjöblom, chief executive officer and co-founder of Minna, says: “This new funding will help us take Minna across the globe to reach more banks and customers than before, and we look forward to working with Element Ventures to achieve our next period of growth.”

Michael McFadgen, partner at Element Ventures, adds: “At Element Ventures, we back bold firms that are revolutionising financial services.”

“Joakim and the team at Minna are doing exactly that, by providing banks with the tech they need to manage the millions of subscriptions their customers have, whilst bringing the switching service in-house to provide additional revenue streams. This is a clear example of the liberating services open banking promised us and we’re excited to be part of this journey with Minna.”

iSTOX raises $50 million in Series A funding round

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iSTOX raises $50 million in Series A funding round

iSTOX, a digital securities platform aiming to make the private capital markets more accessible, just closed its $50 million Series A funding round after attracting two government-backed investors in Japan.

The new investors are JIC Venture Growth Investments, the venture capital arm of Japan Investment Corporation, and the Japanese government-owned Development Bank of Japan.

Japan’s Juroku Bank and Mobile Internet Capital, a venture capital firm, have also invested in iSTOX.

Existing investors include Singapore Exchange, Japan’s Tokai Tokyo Financial Holdings, South Korea’s Hanwha Asset Management, Temasek Holdings subsidiary Heliconia Capital Management and Thailand’s Kiatnakin Phatra Financial Group.

Founded in 2017, iSTOX allows multi-asset issuances of fractionalised private market securities, including equity, bonds and funds, making them accessible to a larger pool of investors outside of institutions or private banking clients.

It creates security tokens using blockchain and smart contract technology, automating manual processes that traditionally restrict issuers from handling large numbers of smaller investors. As a result, iSTOX can reduce minimum investment ticket sizes to $20,000 or less.

iSTOX’s proprietary exchange also allows the secondary buying and selling of securities among investors, enhancing the liquidity and value of those investments.

Hideki Yarimizu, chief executive officer of JIC Venture Growth Investments, believes iSTOX represents “the launch of the next generation of digital financial services and platforms covering Asia” that will “also contribute to the development of Japanese financial services”.

After obtaining a full Monetary Authority of Singapore licence in February last year, iSTOX signed a memorandum of understanding with Chongqing Monetary Authority to set up a digital securities exchange in Chongqing to serve the Chinese market, marking its first overseas expansion.

Oi Yee Choo, chief commercial officer of iSTOX, says plans are in place to expand its geographical footprint and investment offerings as the digital securities space grows “by leaps and bounds in 2021”.

Goldman Sachs chooses Marqeta’s card issuing platform for Marcus

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Goldman Sachs chooses Marqeta's card issuing platform for Marcus

Goldman Sachs will use Marqeta’s card issuing platform to underpin its Marcus current accounts when they launch later this year.

Marcus, the global financial services firm’s digital banking arm for consumers, will take advantage of different capabilities offered by Marqeta’s card issuing platform, including open APIs and webhooks, as well as a cutting-edge developer experience.

Omer Ismail, global head of the consumer business at Goldman Sachs, says “integrating with Marqeta’s platform will allow us to create a personalised, feature-rich banking experience for our checking customers”.

The partnership with Marqeta follows reports that Goldman Sachs is considering a number of acquisitions to boost Marcus, in a bid to lessen global firm’s reliance on trading and investment banking revenues.

According to Reuters, digital businesses that bring in new customers or unique technologies would be attractive to Goldman Sachs as potential acquisitions.

Jason Gardner, founder and chief executive officer of US-headquartered Marqeta, says the partnership with Goldman Sachs is “a true validation of the power of our technology.”

He continues: “Our modern card issuing platform helps digital innovators build the sorts of customer experiences that can be industry game changers, and we’re looking forward to working alongside Marcus to bring a powerful new digital banking experience to life.”

Marqeta extended its global partnership with Mastercard in October 2020.

The partnership extension will see the companies expand into new geographies, open access to new products, and launch additional card programmes together.

Mastercard also made an undisclosed financial investment in Marqeta as part of the partnership extension.

Infineon issues new employee ID card with payment functionality

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Infineon issues new employee ID card with payment functionality

Semiconductor manufacturer Infineon Technologies is replacing the employee ID cards at its headquarters in Germany with a solution that combines highly secured office building access and a flexible, contactless Mastercard payment function.

Employees based at Infineon’s Am Campeon building in Munich can enter company buildings and the workplace, make cashless payments, or transmit their digital business card using near-field-communication (NFC).

Called the Campeon Card, the smart card solution was built in partnership with Mastercard, PayCenter and petaFuel.

Infineon will be responsible for managing and issuing the employee ID card, which was developed to comply with the EMV standard for chip-based payment solutions and readers used internationally.

This means the Campeon Card can be used at work at coffee machines or in company restaurants, for example, but also outside Infineon premises at all 70 million Mastercard acceptance points worldwide.

At the heart of the Campeon Card is Infineon’s SECORA Pay solution, which enables the quick and efficient production of certified payment cards according to EMV standards.

The CIPURSE functionality integrated into the Campeon Card’s chip allows secure access to company buildings. The solution tends to be deployed in innovative transit, access and smart city systems.

Thomas Rosteck, president of Infineon‘s connected secure systems division, says: “Infineon set standards for a modern and creative working environment very early on with the campus architecture at its headquarters. We continue to do so with the new employee ID cards.”

“Contactless technologies are convenient and hygienic which has never been more important than today to protect us from the Corona pandemic. But contactless smart building solutions that combine multiple functions in one card are also becoming increasingly important in the long term.”

Payment service provider petaFuel is responsible for integrating the Mastercard payment function.

Infineon employees can use petaFuel’s mobile payment app, VIMpay, to digitally link their bank account to their company card for direct charging via their computer or smartphone. Mobile payments via smartphone are also possible.

The VIMpay app also provides a transparent overview of all transactions and instant spending control.

Ludwig Adam, chief technology officer at petaFuel, says: “Together with Infineon and Mastercard, we have developed an innovative and multifunctional corporate card with contactless payment functionality.”

“By connecting to Mastercard and the existing infrastructure, our mobile payment app VIMpay offers an ideal platform for companies and public authorities to introduce individual smart card applications with payment features and to modernise their building infrastructure.”

Acin aims to take advantage of its momentum

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Acin aims to take advantage of its momentum

Last year was an important one for UK-based risktech company Acin, a data and knowledge-sharing network focused on quantifying, standardising and digitising operational risk, as it embarked on its next stage of growth.

When FinTech Intel last spoke to founder and chief executive officer Paul Ford, Acin had 15 investment banks on its network, including Credit Suisse, Standard Chartered and Société Générale. Set up in 2017 and launched a year later, the regtech company was well placed to “connect financial services firms around operational risk and make the whole business safer”.

Then, of course, Covid-19 happened. Amid a global pandemic, no-one really knew what was coming next. Lockdowns, social distancing, working from home—every day of 2020 brought something new.

Ford predicted that financial organisations around the world would look “for creative ways to cope with their own challenges of managing decentralised teams as social distancing kicks in”. He said: “For many, this will stress the application of their risks and controls definitions in the face of new and un-envisaged scenarios—or ‘unknown unknowns’.”

Acin’s network and the data and peer-sourced insights that the company curates and publishes could prove “key to helping these firms—and the authorities that they answer to”, he continued. It was just a question of making some of those ‘unknowns’ known.

Fast forward to October 2020 and Ford’s predictions were proving correct. Despite the pandemic, Acin was able to raise $12 million in series A funding to spearhead efforts to create a complete front-to-back-office solution to assess and manage operational and non-financial risks. The company has also grown its team from 20 to over 50 colleagues and associates since September 2020.

‘Covid-19 was one big operational risk event’

Acin aims to take advantage of its momentum (2)
Paul Ford, founder and chief executive officer, Acin

Ford tells FinTech Intel today: “Covid-19 was one big operational risk event, so there was no longer any need to explain Acin’s role. Everyone we spoke to was experiencing it for themselves.”

Operational risk, unlike credit or market risk, lacks standardisation and digitisation, so it’s weighed and measured on an individual basis, to the best of the ability of each financial services institution in question.

Increasingly, institutions are recognising the importance of their operational risk data, its provenance and integrity—the days of using Microsoft Excel-based solutions are numbered as the value of the data is more fully appreciated.

The pandemic brought home the need for a better way of handling operational risk, through both digitisation and sharing the burden through collaboration.

Acin reacted quickly to the outbreak of Covid-19 in February and March across much of the world. The company was inundated with requests from network members to find out how other firms were coping, so proceeded to publish as much relevant data as possible and deliver intelligence to its network.

Acin also went ahead as planned with a front-end launch in April 2020, given the need for platforms such as its own to be accessed remotely as network members around the world moved staff members off site.

Ford comments: “We have had lots of opportunities to help organisations move along their digital journey and help make everything more secure. For example, a hybrid office and home working model is emerging, requiring technology that can be used and integrated in a number of different ways.”

He adds that the online community that Acin manages has become essential during the pandemic, proving the importance of a network of financial institutions such as its own.

Acin’s series A investors, European software-as-a-service investor Notion Capital and Fitch Ventures, the investment arm of US-based ratings agency Fitch, recognised this importance and were quick to connect with the company once the initial shock of the pandemic wore off.

Conducting such a large fundraise amid a pandemic and restrictions on travel was unusual, Ford says, but not impossible. He found it easier to build rapport with investors than he’d expected.

The whole process, conducted via video conferencing, lacked the personal touch of face-to-face meetings, but it was certainly more efficient, he says.

Investors are bringing more to Acin than just capital investment

Both Notion and Fitch are bringing more to Acin than just capital investment, which will be used to enhance Acin’s cloud-based Terminal solution with additional inventories of risks and controls, extended functionality, software extensions, and integrated benchmarking.

Notion Capital is helping to build Acin as a company and holds a seat on its board. Fitch Ventures, meanwhile, brings significant credit risk expertise, and can offer insights into working with credit risk analysts and experience of turning data into intelligence for the wider market.

Investor interest was reflected in several awards last year. Acin won the RegTech Initiative Award at the UK FinTech Awards in November 2020. The company was also highly commended at the Regulation Asia Awards for Excellence and won Most Innovative Third-Party Technology Vendor—Trading, Risk and Compliance at the American Financial Technology Awards.

Acin plans to “improve and enhance” its investment bank offering in 2021, with a view to adopting a regional approach in the expansion of its network. Ford intends to enter the asset management market in the next 12 months and retail banking after that.

Acin has also explored healthcare as a possible market for its solution, with a proof of concept identifying several similarities with financial services.

Ford says a consultancy firm was commissioned to further explore healthcare as a potential market, “because we now have the backing to take advantage of our momentum”.

UK FinTech Awards 2021 is open for entries

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UK FinTech Awards 2021 is open for entries

The UK FinTech Awards is returning to celebrate the innovation, ingenuity and successes of the fintech communities in England, Scotland, Wales and Northern Ireland.

Entries for 2021 are now open. The entry deadline is 26 February. All that’s required to enter is a written submission of between 250 and 1,000 words, or a three-minute video.

Twenty-five categories will recognise the full spectrum of fintech products, services and solutions, as well as company achievements and the innovation and commitment of leading individuals.

Independent judging panels made up of experts from across the UK, all chosen for their expertise, experience and positions in financial services, will assess entries, formulate the shortlist and select the winners. Judges will be announced soon.

The UK FinTech Awards launched in 2020, amid the global pandemic. But the fintech communities in the UK stood up and were counted as innovative yet reliable providers of much-needed products, services and solutions.

They were recognised during a widely watched online broadcast in November. Congratulations are due once again to all of the 2020 winners and finalists.

Left top: RegTech Initiative Award, Acin
Left bottom: Payments Tech Award, Curve
Right: Online Initiative of the Year and Team of the Year, Refinitiv
Left: InsurTech Award, Cuuva
Right: Personal Finance Tech Award, Wealthify

Winners of the UK FinTech Awards 2021 will be announced during an in-person ceremony on 20 May at Leonardo Royal London St Paul’s.

FinTech Intel also recently launched the inaugural Asia, European and US FinTech Awards so that fintech companies of all stripes, shapes and sizes can now seek the recognition they deserve.

Visit fintechawardsasia.com, fintechawardseurope.com or usfintechawards.com to learn more about these awards and find how you can enter.

IHS Markit acquires regtech provider Cappitech

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IHS Markit acquires regtech provider Cappitech

Financial data and intelligence company IHS Markit is expanding its suite of global, multi-asset class transaction regulatory reporting offerings to financial services providers with the acquisition of Cappitech.

Cappitech, a private company based in Israel, provides robust regulatory reporting, best execution analysis and business intelligence solutions, allowing customers to efficiently comply with transaction reporting regulations across multiple jurisdictions in one place.

The firm’s scalable cloud-based platform is relied on by more than 200 global banks, brokers, asset managers, hedge funds and corporations, and its products and technology have received numerous industry awards.

In 2019, IHS Markit selected Cappitech’s platform as a key component of its Securities Financing Transactions Regulation (SFTR) solution, which is now relied on by some of the largest financial institutions in the world.

Capitalising on the established relationship and existing integration, the acquisition, for an undisclosed sum, will deliver unified solutions to the market and solidify IHS Markit’s continued commitment to providing industry-leading regulatory reporting solutions.

Pierre Khemdoudi, managing director of global equities at IHS Markit, says: “Regulatory reporting demands will continue to grow rapidly around the globe and customers are looking for a reliable, frictionless and cost-effective way to comply with requirements across jurisdictions.” 

“Cappitech’s platform complements our existing offering, enabling us to provide the most comprehensive and scalable integrated financial regulatory service to customers.”

Ronen Kertis, chief executive officer and founder at Cappitech, comments: “We are excited to join a company that shares our passion for providing best-of-breed regulatory reporting solutions and looking forward to expanding our existing commitment to the industry.”

“Based on our extensive engagement with IHS Markit over the past two years, we are confident that combining our mutual successes and sector expertise will enable us to accelerate our product enhancement and services for the benefit of our global clients.”

How to enter FinTech Intel’s awards

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How to enter FinTech Intel's awards

Fintech companies of all stripes, shapes and sizes can now seek the recognition they deserve with the launch of FinTech Intel’s inaugural Asia, European and US FinTech Awards.

Set to be held virtually in view of the Covid-19 pandemic and following the success of the UK FinTech Awards in November 2020, the three events dedicated to fintech communities in and serving Asia, Europe and the US will be held on 27 and 28 April 2021.

The entry deadline for each event is 26 February 2021.

Visit fintechawardsasia.com, fintechawardseurope.com or usfintechawards.com to learn more about these awards and the categories.

In the meantime, follow these simple steps and you’ll produce a submission that our independent panel of judges will find clear, concise and compelling.

Pick your categories: There are lots of categories to choose from. Read the criteria carefully for each and decide which will give you the best opportunity to demonstrate your strengths.

Choose the form of your entry: Make sure every submission is unique for the category that you’re entering. We accept written submissions of between 250 and 1,000 words per category. Written submissions are at their best after several drafts, with input from everyone involved. Remember that your entry needs to stand out from the crowd, so keep it active, free of jargon, and don’t forget to proofread your words before entering. Alternatively, you can enter a video submission. You’ll have a maximum of three minutes to demonstrate why you, your team or business should win the particular category. Videos are easy to digest and revisit, and they allow the judges to put a face to an entry.

Submit your nomination online via the entry form: Entries can only be accepted via the entry form. Fill out all of the required information, and make sure you choose the correct category from the list. The form must be filled out and submitted for every category. The form removes all formatting, so don’t worry about italics, bolding, underlining or hyperlinking, as these won’t make it through our system. Furthermore, no supporting documents and attachments are allowed, so don’t use the attach buttons for CVs, promo videos, PDFs and Word docs—these won’t make it through our system, either. For written submissions, input your 250 to 1,000 words in the ‘Reason Why’ box. For video entries, fill out the form, except the ‘Reason Why’ box, and submit your video via WeTransfer to simon.krawczynski@barkerbrooks.co.uk.

Attach your logo: If you make it to the shortlist, we’ll need a high resolution version of your logo for the ceremony and marketing campaigns. We accept the .JPEG, .PNG and .PDF formats, but prefer .EPS wherever possible. If you don’t have this, don’t worry.

Attach nominee’s photo: This is for the individual awards. Colour photos are preferred, and high resolution .JPEG is best.

Sit back and wait for news: That’s it, you’re done! Approximately two weeks following the entry deadline, our judging panel will convene to make their final decisions. We’ll then get in touch with every finalist to give them the good news.