One in five financial services jobs will be replaced by artificial intelligence (AI) or automation within the next five years, according to the latest KPMG and Harvey Nash report.The survey of 3,600 IT leaders found that 43 per cent of banks expect a fifth or more of their workforce to be replaced by AI or automation by 2024.
The Board of Banking Competition Remedies has announced the results of the Capability and Innovation Fund Pool D grant process, with Codat, Fluidly, Form3, Funding Options and Swoop Finance getting £5 million each. Pool D is designed to facilitate the commercialisation of financial technology that is relevant to small and medium-sized enterprises (SMEs).
FinTech challengers N26 and Monzo are gearing up to launch their services in the US in the coming months, as European challenger banks accelerate their global expansion strategies. Berlin-based digital bank N26, which first launched in Germany in 2015, announced that it had now reached the milestone of 3.5 million customers across 24 markets, and confirmed that it would be ready to launch its app-based banking services in the US “in the coming weeks.”
The Monetary Authority of Singapore (MAS), the Bank of England (BoE) and the Financial Conduct Authority (FCA) announced that they will be working together to strengthen cyber security in their financial sectors. MAS and the UK financial authorities will commence work towards a Memorandum of Understanding to signify this enhanced collaboration.
Augmentum Fintech has announced a total of £8.5 million of follow-on investments to startups in its growing portolio. The publicly listed venture capital outfit has topped up its existing funding in business banking firm Tide (£5 million), mobile-only current account provider Monese (£2.5 million) and predictive business intelligence platform DueDil (£1 million).
Venture capital firm InsurTech Gateway is targeting up to £30 million of investment for a new fund aimed at supporting tech startups in the insurance and reinsurance space. The Gateway Fund has kicked off by investing £2.25 million in By Miles - UK-based provider of pay-per-mile car insurance - Floodflash - a provider of tech-enabled flood insurance for small business - Guardhog - a plug-in insurance provider for the gig-economy - and Insurdata - a technology provider for peril-specific exposure and risk data.
More than seven million people in the UK were left unable to use their debit or credit cards due to an IT or technical crash in the last year, according to research from Which? A survey of more than 2,091 consumers conducted by the consumer watchdog found one in seven respondents were unable to use their card due to a serious outage in the last year, with half (49 per cent) saying they were unable to pay for goods and services at the point of sale as a result.
Tech Nation has, for the fifth-year running, revealed a continued rise in demand for applications for the Tech Nation Visa, up 45 per cent for 2018-19 with a total of 650 applications. The countries with the highest amount of visa applications continue to be India and the USA, from software engineers and business developers in artificial intelligence and machine learning, FinTech and enterprise/cloud sectors. Nigeria, Russia, Canada, Australia, China and South Africa also top the list for number of applications.
The greatest barrier to UK financial institutions developing digital products, services and operations is regulatory compliance risk. This is according to a report from FIS which surveyed more than 2,000 C-level and senior executives across buy-side, sell-side, insurance firms and retail banks.
Legal & General has launched ‘estua-re’, the first pension risk transfer execution platform driven by blockchain technology. Part of the insurance and investment group’s global Pension Risk Transfer (PRT) strategy, it is a single ecosystem capable of driving every stage of the reinsurance value chain, including pricing, claims handling, financial reporting and collateral; utilising data dynamically stored on the blockchain.
Datactics has raised £1.2 million in a funding round led by Kernel Capital and Par Equity. The Belfast-based RegTech startup provides data quality and matching software to the financial services industry and government departments to help measure, clean and match data.
New research has found consumer openness to alternative payment options - including wearables and smartphones - although acceptance of cashless payments comes with a high degree of concern surrounding the ability to secure these devices. A study commissioned by Transaction Network Services (TNS) surveyed more than 3,000 consumers in the United States, United Kingdom and Australia, finding 44 per cent of respondents are willing to make a payment using a wearable device like a ring or a bracelet.
Visa is rolling out a blockchain-based cross-border payments network for business to business (B2B) customers. The B2B Connect network will use distributed ledger technology (DLT) to help financial institutions process high-value corporate payments faster and more securely. The network aims to remove friction by facilitating transactions from the bank of origin directly to the beneficiary bank.
The International Monetary Fund’s (IMF) deputy managing director has warned that while FinTech can support productivity and growth by strengthening financial development, inclusion and efficiency, it “may pose risks to consumers and investors and, more broadly, to financial stability and integrity”. Speaking at a conference in Vilnius, Lithuania, earlier this week, Tao Zhang said that FinTech is expected to promote competition in the financial sector, particularly in payments clearing and settlement.
Complex legacy infrastructure is one of the biggest barriers to the adoption of innovative point of sale (PoS) technologies which could be worth over £157 million to UK businesses in the next year, according to a new report. A survey of 700 IT decision-makers in banking and financial services in the UK, US, Germany, France, Spain, Italy and the Nordics by lending platform Divido, found that 54 per cent of UK lenders are battling against legacy infrastructure when it comes to delivering new payments technology.
Amazon and Synchrony have announced the launch of the Amazon Credit Builder card, for customers who are looking to build or rebuild their credit responsibly. This secured private label card has no annual fee, offers eligible Prime members five per cent back on Amazon purchases, and offers all cardholders equal pay instalments and special financing options on eligible purchases.
FinTech unicorn Revolut has launched Apple Pay for customers in the UK and 15 other countries.The contactless mobile payment method, which enables customers to pay in-app, online and on Apple devices, will now be available to Revolut customers in the UK, France, Poland, Germany, Czech Republic, Spain, Italy, Switzerland, Ireland, Belgium, Austria, Sweden, Denmark, Norway and Finland.
Traditional retail banks are lagging behind in terms of blockchain adoption, potentially losing out on customers and competitive advantage. This is according to a report from McKinsey, which noted that this contrasts with efforts seen elsewhere.
Six European mobile wallets have collaborated with Alipay to promote QR code-based digital payment interoperability for travellers both in Europe and from China. Bluecode, ePassi, momo pocket, Pagaqui, Pivo, Vipps and Alipay are working towards adopting a unified QR code, which will enable users to make payments with their home apps to local merchants in 10 European countries where those apps are accepted.
UK firms adopting artificial intelligence (AI) tools could deliver a 22 per cent boost to the UK economy by 2030, according to a new report from McKinsey and data analysis from Quantumblack. The analysis, based on simulations from McKinsey Global Institute (MGI), also suggested that firms could benefit from a 120 per cent increase in total economic value, implying additional growth in cash generation of about six per cent a year for the next 12 years.
Wrisk completed its latest equity crowdfunding campaign on Seedrs, raising a total of £978,682. The funding round was launched earlier this spring, originally seeking £750,000. The UK-based InsurTech startup raised £1 million through its second Seedrs initiative less than a year ago.
International digital remittances will reach $525 billion by 2024, up from an estimated $332 billion in 2019, with mobile and blockchain solutions becoming increasingly popular. Juniper Research analysis predicted that the mobile channel will account for 41 per cent of international digital money transfers by volume in 2024, up from a third in 2019.
FinTech giant Oaknorth is bracing for a new economic downturn which may see it shouldering the first default since it launched its small business loans service in 2015, according to founder and chief executive Rishi Khosla. Speaking at the Money 20/20 conference in Amsterdam, Khosla said Oaknorth - which became Europe’s highest valued FinTech after raising $440 million in February - was proud of its record of zero credit defaults on its loan book, but acknowledged that an economic slowdown was inevitable, which could lead to defaults and potential losses.
Getsafe has raised €17 million in a Series A funding round led by Earlybird, with participation from CommerzVentures and other existing investors. The German InsurTech startup will use the money to prepare its European expansion and more than double its team from the current 50 employees, with a focus on customer care, software development and data science.
JPMorgan Chase is to close its mobile-only bank for Millennials, Finn, just a year after it was launched across the US. The Wall Street Journal reported that Finn customers were told their funds were being transferred to other Chase accounts.
UK consumers are taking a ‘pick n mix’ approach to how they make payments, with mobile banking, mobile payments and contactless all becoming increasingly popular, according to research by UK Finance. Its latest survey found that almost half (48 per cent) of UK adults used mobile banking in 2018, up from 41 per cent the previous year. The number of bank payments made using online or mobile banking in 2018 grew to two billion, up from 1.6 billion in 2017, as consumers and businesses increasingly choose to bank using their phones, tablets or computers.
Facebook does not view itself as a payments company and is looking to partner with banks and other players in the market as it considers the role of payments and Open Banking solutions across its family of apps, according to the social media firm’s head of payments. Speaking at the Money2020 conference in Amsterdam, Paulette Rowe, Facebook’s head of payments and financial services partnerships, and previously head of Barclaycard, said growing use of Facebook as a platform for commerce, particularly in Asia, was accelerating discussions over Facebook’s own role as payments facilitator.
Visa has announced a strategic agreement with Western Union, which will implement the Visa Direct real-time push payments platform. Once Western Union’s implementation of Visa Direct is live, it will be able to offer customers an expedited remittance service onto cards with more transparency for both senders and receivers.
Money management app Yolt has partnered with pan-European savings marketplace Raisin. Beginning in the UK, followed by Italy and France, Yolt will provide its users access to a range of saving deposit rates from Raisin’s partner banks, directly through the app. Raisin partners include N26, Commerzbank, Vanguard and ClearScore, plus the more than 75 partner banks offering deposits across Raisin’s seven platforms, while Yolt collaborates with MoneySuperMarket, Anorak, Wealthify, Pensionbee and others.
Mastercard’s mobile payments service ‘Pay by Bank app’ has entered into a strategic partnership with marketing and loyalty commerce platform Yoyo. Under the partnership, Yoyo and the Pay by Bank app (PbBa) will deliver a combined payments and customer loyalty offering to retail and bank customers.
Tech Nation is calling for applicants for its 2019 Fintech Growth Programme, delivered as part of HM Treasury's Fintech Sector Strategy. Supported by Al Lukies and David Duffy of the Fintech Alliance, and running from September 2019 to March 2020, the leadership development programme is specifically designed to connect and create opportunities for the founders of the UK’s most promising FinTech scaleups.
Global incumbents should embrace partnerships with tech titans, as well as smaller FinTechs, in order to keep up with the emerging challenge posed big tech firms according to Santander’s chief digital officer. Speaking at the Money 2020 conference in Amsterdam, Lindsey Argalas, chief digital and innovation officer at Banco Santander, underlined her focus on ensuring the financial services giant has the technology and talent to adapt to the rapidly changing financial services landscape.
FinTechs are not prepared to accept shortcomings in the fight against financial crime, new figures from LexisNexis Risk Solutions have revealed. Almost half (48 per cent) of UK based FinTech companies don’t think the existing UK regulatory framework is effective in combatting financial crime in the UK, with 12 per cent going so far as to say that it is not at all effective.
Incumbent banking giants are combatting the rising threat of challenger banks by striking unfair partnerships that have left FinTech challengers ‘sucked dry’, according to Starling Bank chief executive and founder Anne Boden. Speaking on a panel discussion at the Money20/20 conference in Amsterdam, Boden launched an attack on the approach big banks have taken in order to replicate the technology, platforms and working culture of nimble challengers, and accused CEOs of “playing startup safari” before “using” the smaller organisation for information.
Following consultation, the Financial Conduct Authority (FCA) is introducing rules in the peer-to-peer (P2P) sector, “designed to prevent harm to investors, without stifling innovation”. The regulator has refined its proposals, giving additional guidance to make it clear that platforms will not be prevented from including information about specific investments in their marketing materials.
Visa and Currencycloud have announced a partnership to drive innovation in cross-border and travel payments. Visa’s clients, banking, and FinTech partners will now have the option to use Currencycloud’s cloud-based payments platform to offer customers services like multi-currency wallets and real-time notifications on foreign exchange transactions.
Even though Open Banking has yet to reach maturity, the financial services industry is entering a new phase of innovation that will require deeper collaboration and specialisation. The European Financial Management Association (EFMA) and Capgemini’s latest World FinTech Report called this Open X, and stated that it will transform industry norms and assumptions, with a move away from the product focus to an emphasis on customer experience; the evolution of data as the critical asset; a shift from prioritising ownership to facilitating shared access; and an emphasis on partnering to innovate instead of buying or building new solutions.
Artificial intelligence-driven decision making could lead financial services firms into “vicious cycles” of automation, according to a panel of experts. Speaking during a discussion on the implications of AI technologies, such as machine learning and biometrics, at the Money20/20 conference in Amsterdam, Dror Oren, chief product officer and co-founder at conversational AI platform Kasisto, highlighted the need for continued human oversight of algorithms.
The banking services of the future will be mobile first and ‘data obsessed’, two digital trends already taking hold across the financial services industry, according to the chief executive of ING. In a keynote speech to the Money2020 conference in Amsterdam, Ralph Hamers, who has led the Dutch banking giant since 2013, underlined his conviction that the “bank of the future is digital and it’s mobile first” and urged incumbents to look to new technologies to keep up with rapidly changing customer needs and expectations.
Over half of consumers in the UK (53 per cent) are worried that the shift to biometrics to authenticate online payments will dramatically increase the amount of identity fraud, according to new research conducted by Paysafe. The research was completed among 6,197 consumers from the US, UK, Canada, Germany, Austria and Bulgaria, across ages groups and professions, finding that 79 per cent still favour passwords for making payments online, due to concerns about the security of new biometric options.
Banking Competition Remedies (BCR), the independent body established to implement the £775 million Royal Bank of Scotland State Aid Alternative Remedies Package, has opened the second application window for the Incentivised Switching Scheme (ISS). The purpose of the ISS is to provide £275 million worth of funding to small to medium-sized enterprise (SME) customers of the business previously described as Williams & Glyn, to switch their business current accounts and loans to ‘challenger’ institutions. A further maximum sum of £75 million has been set aside within RBS to cover certain customers’ switching costs.
FinTech services have hit the mainstream according to the latest EY FinTech Adoption Index. The study, based on 27,000 online interviews across 27 markets, revealed that China and India are in pole position in terms of FinTech usage, with 87 per cent of the population now using such services, closely followed by Russia and South Africa, both with 82 per cent.
Almost 40 per cent of all financial services applications in Europe are abandoned, despite massive investment in digital transformation by institutions, according to new research. Although this figure is an improvement on 2018’s high of 52 per cent, it means that abandonment rates have returned to nearly the same level as 2016 (40 per cent).
A consortium of companies have launched b.yond, a financial innovation platform that will let banks and consumer-facing businesses rapidly deploy a range of FinTech payment services. The consortium includes Global Processing Services, Pannovate, Cornercard, Modulr, AllPay, Meawallet and W2 Global.
Six out of seven people use digital banking solutions at least once a month and 38 per cent do so on a weekly or even daily basis, according to new research. Mastercard commissioned TNS Kantar to take 11,014 samples were taken from 11 different markets, finding that 63 per cent use mobile banking apps from traditional banks and 20 per cent from digital-only banks.
Dashlane has closed a $110 million Series D funding round led by Sequoia Capital. The credential and digital identity management solution will welcome Sequoia’s Jim Goetz to its board of directors, and also sealed investment from Rho Ventures, FirstMark Capital and Bessemer Venture Partners in the round.
Allied Irish Bank (AIB), Bank of Ireland and Ulster Bank are piloting a blockchain platform to track and manage employee education and qualifications. Developed in collaboration with the Institute of Banking (IoB) and Deloitte, it will support the verification, tracking, direct access to, and management of, regulatory and professional designations, education qualifications and lifelong learning credentials.
IRESS has acquired QuantHouse for up to €38.9 million a debt and cash free basis, with a material portion subject to earnout performance criteria through to the end of 2021. QuantHouse operates internationally, with a focus on Europe, North America and Asia, providing more than 145 data feeds from exchanges and other data providers to clients.
More than half of UK employees (53 per cent) do not have a minimum level of digital skills, like using digital collaboration tools or managing digital records and files, despite the growing need for a digitally savvy workforce and a 15 per cent surge in the number of employees who need to be online to do their job.
Workers who have such digital skills are paid £12,500 more on average per year than those without, according to the Lloyds Bank Consumer Digital Index. The study of more than one million UK adults found that many people don’t have basic digital understanding of online tasks including – using search engines finding information online (21 per cent), managing money online (27 per cent) and keeping safe online (34 per cent).
Money management app Money Dashboard and cryptocurrency wallet CoinBase have teamed up to allow users to see their cryptocurrency wallets alongside their other accounts. Users can now track the value of their crypto holdings in real-time alongside all the other current, credit and saving accounts they hold with any bank via Money Dashboard’s app.
The Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) have fined Raphaels Bank £1.89 million for failing to manage its outsourcing arrangements properly between April 2014 and December 2016.
Raphaels received separate fines of £775,000 from the FCA and £1.1 million from the PRA in respect of these breaches.
The UK’s challenger banks are struggling to break the big five bank’s stranglehold on the savings market, despite offering much higher levels of interest than their larger rivals. Barclays, HSBC, Lloyds, Royal Bank of Scotland and Santander hold £827 billion of the £1.3 trillion in UK household deposits, equivalent to a market share of 63 per cent, despite paying significantly lower rates of interest on average.
The United States and United Kingdom have established the Financial Innovation Partnership to further collaboration between US Department of the Treasury and HM Treasury. It will deepen bilateral engagement on emerging trends in financial services innovation, encouraging collaboration in the private sector, sharing information and expertise about regulatory practices, and promoting industry growth.
A quarter of UK consumers believe the High Street bank will be ‘dead’ within the next five years, according to new research. A survey of more than 2,000 UK consumers by banking and payments solution Contis also found that attitudes to the future of the traditional banking model are even more pessimistic amongst younger generations, with 40 per cent of Millennials (those aged 25-44) believing that the High Street lender is already dead, or will be within the next half-decade.
As financial institutions approach the September 14 deadline to comply with Open Banking legislation, two fifths of financial institutions (39 per cent) still see regulation as the biggest threat to their business model. A survey of 269 senior decision makers in European financial institutions by Open Banking platform Tink found that a majority (56 per cent) fear consumer loyalty towards banks will diminished as the legislation opens up financial data sharing with third parties.
US FinTech network platform Plaid has launched in the UK with two customers, including money-management app Emma. As part of its commitment to the country, Plaid is planning to hire over 25 people locally by 2020 and has opened a UK office.
Nearly half (45 per cent) of office workers would be willing to sell their firm’s corporate information, according to a new survey which highlights the growing risk of insider threat to UK businesses. A study by Malvern-based cyber security startup Deep Secure found that a quarter of employees would accept £1,000 as the price for giving away company information to outsiders, whilst five per cent would offer it for free.
Almost three-quarters (72 per cent) of organisations have been victims of financial crime over the past 12 months, with a lax approach to due diligence checks when onboarding cited as creating an environment in which criminal activity can thrive. This wake-up call has led to 59 per cent of companies adopting new technologies to plug compliance gaps, according to Refinitiv, which in March surveyed 3,138 managers with compliance-related responsibilities at large organisations from across 24 geographies.
This year looks set to be on course for a record number of Anti-Money Laundering (AML) fines, with $7.7 billion already handed out in January to April 2019, compared to $1.16 billion worth of fines in the same period last year. The combined value of penalties given out so far in 2019 is over 70 per cent of the total handed out in the whole of 2014 ($10.89 billion) – the year which currently holds the record for highest total value of fines.
Cyber crime and hacking offences are going unpunished in the UK, according to a new report, which claims less than one per cent of reported attacks reach prosecution.City law firm RPC stated there were 65 prosecutions for computer hacking in the UK in the year ending 2018, up 38 per cent from the 47 incidents recorded in 2017.
InsurTech company Pikl has landed £2.5 million in its latest funding round, led by Direct Line and esure founder Peter Wood. The Norwich-based startup, founded in 2016 by former Co-op and Gallagher head of pricing Louise Birritteri, offers insurance products for the sharing economy with a focus on the Airbnb market.
Over half (52 per cent) of businesses are struggling to manage their IT infrastructure as a result of creaking legacy systems, poorly co-ordinated strategy and inadequate monitoring tools, according to a new report. A study of 141 IT professions for digital transformation platform Opsview found that many companies have unfit IT strategies in place to adequately support their digital transformation projects – even though many agree it’s a top priority.
London-based RegTech firm ClauseMatch has closed its first venture debt funding round with Silicon Valley Bank. The $2.5 million loan package will be allocated to support the company's continued growth in Europe and Asia, having recently started operations in Singapore.
HSBC has launched two new data innovation labs in London and Toronto, as part of its plans to expand its investment in artificial intelligence (AI) and machine learning (ML) across its global markets.The research lab in London is expected to employ 100 staff specialised in AI, along with technologists, co-op students and interns, while the Toronto lab will employ 50 members of staff.
Three quarters of organisations could be struggling with General Data Protection Regulation (GDPR) compliance, a year on from its introduction. Crown Records Management commissioned Sapio Research to interview 103 senior managers, IT and data professionals in companies with over 250 employees in March, finding that only 23 per cent consider their compliance capabilities around GDPR to be very good.
Facebook is reportedly planning to launch its own cryptocurrency and digital payments in 2020. It was first reported in December last year that the social media giant was working on plans for a digital payments system in around a dozen countries for the first quarter of 2020.
TSB has announced the appointment of a new chief operating officer (COO) and customer banking director as the challenger bank seeks to reset its direction in the wake of a series of major IT failures. The board shakeup comes after Debbie Crosbie took up the reins as chief executive following the departure of Paul Pester, who stood down in September last year after a botched IT migration in April that repeatedly left thousands of customers without access to online banking services.
Revolut has launched a joint savings facility to enable users to club together with family and friends through in-app pots.The challenger bank’s Group Vaults function marks an evolution of its Vaults feature, which has been used to create one million savings pots with more than £75 million in value, since the product launched in April last year.
Robots and automated technologies are unlikely to replace human interaction in the digital banking relationships of the future, according to Wells Fargo’s ATM and branch IT chief. Speaking at the RBR self-service banking Europe conference in London, Michael Graham explained that despite the rapid spread of digital and automated banking services across their core market, customers would continue to expect human interaction.
Small businesses are losing out because UK banks are failing to prioritise fixing Open Banking outages, with 62 per cent of banks recording a fall in Open Banking availability to customers over the last quarter. Peer-to-peer business lender Growth Street reviewed publicly-available data which the Open Banking Implementation Entity published on its API downtime monitoring tool.
Marqeta has completed a $260 million Series E fundraise, led by Coatue Management, valuing the business at nearly $2 billion. The card issuing platform will use the money to accelerate its expansion plans, both domestically and in key global markets.
Canadian payments firm Nuvei is set to buy British payments technology provider SafeCharge for £699 million in an all-cash deal. Under the terms of the deal, SafeCharge shareholders will receive $5.55 in cash per share and a 25 per cent premium on the business value at last close.
Transferwise has raised a further $292 million, valuing the company a $3.5 billion and making it one of Europe’s most valuable FinTechs.The digital crossborder payments provider announced the secondary funding round led by growth capital investors Lead Edge Capital, Lone Pine Capital and Vitruvian Partners, in addition to support from funds managed by BlackRock, as well as existing investors Andreessen Horowitz and Baillie Gifford, which expanded their holdings.
New research from Which? has showed that £674 a minute is lost to bank transfer scams, with the consumer champion calling for all banks to reassure customers they will be better protected against fraudsters by signing up to the new voluntary industry code, which comes into effect next week. The Payments Systems Regulator recently announced it is consulting further on Confirmation of Payee, delaying its introduction until March 2020, nine months later than its original deadline of July 2019, which Which? argued would result in an additional £109 million being lost to scams.
Nationwide Building Society has reported a 15 per cent fall in profits for the year, after the company committed to a spending drive on digital banking services and faced fierce competition in the home lending market.The building society reported pre-tax profits of £833 million for the financial year to 4 April, down from £977 million last year.
Digital money transfer firm Azimo is partnering with NatWest Markets to expand its service across Europe.The deal will see Natwest Markets provide Azimo with significantly enhanced access to global foreign exchange markets.
HSBC has signed an agreement with Globality to adopt its artificial intelligence platform for sourcing and procurement of services. The global bank will be now able to scope projects in hours rather than days, and match unique requirements to relevant suppliers around the world.
Lloyds Banking Group has unveiled plans to create a new tech hub in Edinburgh to help transform the digital experience for Bank of Scotland, Lloyds Bank, Halifax and Scottish Widows customers. As part of a £3 billion investment programme, the hub will boost Scotland’s tech sector with 500 new software engineering roles in the capital.
Banks from France, Germany, Italy, Luxembourg, Russia and Spain have joined with SWIFT to test real-time gpi cross-border payments through the Eurosystem’s Target Instant Payment Settlement (TIPS) system. SWIFT and the European Central Banks (ECB) are launching the initiative with European banks to extend the reach of instant cross-border payments in the European market.
The Financial Conduct Authority (FCA) and Action Fraud have warned the public to be wary of investment scams carried out via bogus online trading platforms. This comes as crypto assets and forex investment scams reports more than tripled last year to over 1,800. Fraudsters promise high returns from investments in crypto and forex, with victims losing over £27 million in total in 2018/19.
More than half of businesses do not have the right in-house skills to execute their artificial intelligence (AI) strategy, despite 93 per cent being “fully invested” in AI, according to new research from SnapLogic. A survey of 300 IT decision-makers from large companies in the UK and US found that the AI skills shortage was most acute in the UK, with 73 per cent lacking the talent they needed to execute their plans, compared to 41 per cent in the US.
Wagestream has secured £15 million in its latest funding round from Balderton Capital and Northzone, taking total fundraising to £40 million.The social impact FinTech aims to fight payday poverty by allowing employers to offer workers the option to draw down their salary early and access earned income in real time for a flat fee of £1.75. It is now used by more than 80 businesses across the UK and Ireland, with more than 125,000 workers having access via the Wagestream app.
The fast pace of digital transformation is outstripping the cyber security capabilities of UK businesses, according to a new report from KPMG. A survey of more than 1,800 chief information security officers (CISOs) and 2,000 consumers - including 100 CISOs and more than 100 consumers in the UK - found that, despite the evident risk to customer relationships of a breach of financial data, more than half (55 per cent) of UK CISOs prioritise financial loss and reputational risk in the event of a breach above the impact of such an incident on customer relationships.
Monzo has hit the milestone of two million customers today, with more than £10.7 billion spent through its banking app since the launch of its debit card service in 2015. More than £2.9 million is sent between users with Monzo accounts on a daily basis, the company claimed, as it forges ahead with efforts to catch up with nearest digital banking rival Revolut, which counts more than four million users across the UK, Europe and Australia.
Modulr has completed an investment round raising £14 million from new investor Frog Capital and existing investors including Blenheim Chalcot. This scale-up capital takes the total amount raised to £24.5 million and will enable the company to accelerate its growth plans.
Atom Bank has partnered with TruNarrative for Anti-Money Laundering transaction monitoring and financial crime customer screening. The Durham-based mobile-only challenger bank stated that its overarching criteria for selecting a real-time AML transaction monitoring and a financial crime customer screening solution was for a platform which would support future products and safeguard against emerging risks in the market.
Metro Bank has completed a £375 million share placing round after strong interest from investors enabled it to exceed an initial target of £350 million placed hours earlier.The challenger bank has seen its share price under pressure in recent months after a blunder with the classification of commercial loans was uncovered in January, leaving it without the capital it needed to continue with its plans for expansion.
Investec shuttered its Click & Invest robo-advisory service, recording a £12.8 million operating loss on the business after attracting fewer investors than expected. During its annual results presentation, the Anglo-South African investment bank reported a second successive year of losses, having already reported a £13.5 million fall in profits in the year ending March 2018. Around £6 million worth of capitalised software was written-off in the current year, bringing total losses to about £32 million.
OpenFin has raised $17 million in a Series C funding round led by Wells Fargo, with participation from Barclays and existing investors, including Bain Capital Ventures, J.P.Morgan and Pivot Investment Partners. The round brings the FinTech’s total amount of venture funding to $40 million. Proceeds will be used to make the operating system ubiquitous on financial desktops and to fund further product innovation.
Almost half (45 per cent) of financial services firms across Europe are struggling to combat the rising cyber security threat, with hackers particularly exploiting internal loopholes through Business Process Compromise (BPC). A survey of more than 1,000 IT decision-makers in Europe by cyber security firm Trend Micro found that 61 per cent of decision makers felt the overall volume of threats have increased over the last year, with two fifths (43 per cent) saying that BPC attacks are a major threat.
New research has revealed that 70 per cent of privacy professionals think their systems will not support new privacy regulations. DataGrail surveyed more than 300 US privacy management decision-makers - including IT, operations, security, legal, and risk and compliance professionals - finding that only half of companies achieved self-reported compliance before last May’s General Data Protection Regulation (GDPR) deadline – while most took seven months or longer to achieve readiness.
A year on from its launch in the UK, fewer than two thirds of UK consumers have never heard of Open Banking, according to new research. A Censuswide survey of 2,000 UK consumers for digital banking software firm Crealogix also found that while one in five consumers had heard of Open Banking, they could not confidently explain what it is.
Research has identified loopholes at Companies House that enables individuals to register as a director, run businesses and enable fraud and money laundering, even after they have been struck-off from holding company directorships. Research into Companies House data conducted by HooYu showed that of the 6,700 currently disqualified directors, there are over 800 that still appear to have an active directorship. The analysis also uncovered over 500 so-called ‘chameleon’ directors who have been disqualified as a director, then subsequently made changes to their name or date of birth in order to register a ‘clean’ directorship.
Insurance specialist RegTech firm REG has secured £2.4 million in its latest funding round. The funding includes a £1.8 million growth capital facility from Shawbrook Bank, supported by further investment from current shareholder Disruptive Capital Investment, and founder Michael Phair.
Data-driven FinTech Certua has acquired InsurTech startup the Surely Group. The deal follows the launch of Certua’s Enterprise Insurance platform last year, which lets distributors to ‘plug in’ via Application Programming Interfaces (APIs).
Nearly three quarters (67 per cent) of organisations that have suffered data breaches lack support from executive leadership for cloud security initiatives, according to a new study. A global survey of 749 organisations by governance software vendor Netwrix highlighted that data security and cloud storage was one of the top security concerns for respondents from the UK, with nearly half (49 per cent) of organisations saying they store personally identifiable information (PII) in the cloud, while 43 per cent remain cautious, saying they would never store payment or financial data there.
Nearly a third (30 per cent) of Brits say their bank is over-ambitious introducing additional services on different devices, saying they do not need or want more ways to interact. At the same time, over two-thirds (69 per cent) expect their bank to be delivering the latest technology to them and a third (34 per cent) say that since they started using devices to manage their money, their financial goals are clearer.
Finastra has added BNP Paribas, Natixis and Societe Generale to its blockchain-based platform for the syndicated loans market.The Fusion LenderComm platform, which has been developed in collaboration with R3’s Corda technology aims to streamline the process of syndicated lending using distributed ledger technology (DLT) to reduce the cost and burden of agent-to-lender administration.
Digital disruption has heightened the need for technological experience amongst leaders of the UK’s biggest businesses, yet broader boardroom diversity is failing to progress, according to new research. Specialist recruitment firm Robert Half conducted its annual research on chief executives (CEOs) of the FTSE100 Index by analysing publicly available sources of information including company websites, financial and company announcements and press releases to track trends, including their career backgrounds, age, gender, nationality and length of tenure.
Last year, the UK attracted five per cent of global high-tech scaleup investment, placing it fourth in the world – ahead of Germany, France and Sweden. This is according to the latest annual report from Tech Nation, which analysed data from partners including Companies House, Organisation for Economic Co-operation and Development (OECD) GitHub, Pitchbook and Streetbees.
The board of Banking Competition Remedies has split the £80 million Capability and Innovation Fund Pool B grants between three large banks. Nationwide Building Society took the lion’s share of £50 million, with Investec Bank and The Co-operative Bank getting £15 million each.
Nearly one in five of tech employees who have seen their company take decisions that could have a negative impact on society have quit their job on ethical grounds, a new study has found. A survey of more than 1,000 technology professionals by think tank Doteveryone found that a rising number of employees across a range of sectors are concerned by ethical impact, with more than a quarter (28 per cent) saying they had seen decisions made that could make technologies harmful for people or society.
The Information Commissioner’s Office (ICO) has warned that organisations need to obtain explicit consent when using consumers’ biometric data. In an official blog, the regulator’s deputy commissioner for policy Steve Wood responded to its investigation of HM Revenue and Customs’ Voice ID service, which led to the government having to delete the data of about five million customers, for whom consent was judged to be out of date.
The Softbank Vision fund has made an $800 million investment in Greensill Capital, a UK FinTech which supplies capital to help global companies with supply chain finance. The investment will see Greensill Capital join the likes of Uber, WeWork and Slack, as the latest company to benefit from Softbank’s megafund, now ranked as the world’s largest technology investment fund.
Nationwide has announced an investment in Artificial Intelligence (AI) voice analysis firm Scaled Insights as part of its £50 million startup venture fund. Scaled Insights uses behavioural AI to analyse the people’s speech to profile them on using demographic and social markers, before communicating in “the language that is most accessible for them”.
The Treasury Committee has published a unanimously-agreed report on consumers’ access to financial services, warning that new technologies risk leaving people behind. The group of MPs stated that a duty of care is an obligation to exercise reasonable care and skill when providing a product or service, noting that if the Financial Conduct Authority (FCA) can’t enforce such behaviour, the committee would support a legal duty of care, creating a legal obligation for firms to act in their customers’ best interests.
InsurTech investors worldwide executed the highest number of transactions and the highest volume of Series B and Series C funding rounds during the first three months of 2019, according to Willis Towers Watson. The advisory, broking and solution company’s analysis found 85 deals with a total value of $1.42 billion in the first quarter, marking the third-straight quarter to deliver more than $1 billion in funding.
The uptake of Open Banking and digital money management is being held back by a lack of consumer trust and confusion over data sharing, with 83 per cent of UK smartphone owners saying they have not yet downloaded a finance app. A study by Deloitte, which drew on a YouGov survey of 1,900 UK smartphone owners, found that just over half (51 per cent) would trust financial advice from a human over a similar service provided by artificial intelligence (AI) on a money management app.
The Payment Systems Regulator (PSR) has published its follow-up consultation for Confirmation of Payee (CoP) – a tool to protect people from Authorised Push Payment (APP) scams and prevent payments being accidentally sent to the wrong account. At the end of 2018, the PSR opened its initial consultation seeking views on a proposal to give a general direction for all payment service providers to implement CoP. There was overall support for the proposal with feedback on its design and proposed deadlines.
Flagstone has raised £11 million in growth capital from investors including Kindred Capital, Moneysupermarket Group, VentureFounders and a number of private individual investors. The London-based FinTech, founded in 2013, has developed the UK’s largest cash deposit platform, which provides clients with access to over 550 deposit accounts from 30 banks through a single application, transmitting more than £3 billion in deposits since 2015.
The chair of the Competition and Markets Authority (CMA) has called for a fundamental rethink of the principles and purpose of competition law and policy in order to keep pace with the digitisation of business. Speaking to the Social Market Foundation yesterday, Andrew Tyrie pointed out that since the passage of the Competition Act in 1998, product market concentration has risen – a problem only set to accelerate with the rise of the digital economy.
Less than a third (31 per cent) of bankers believe partners in their ecosystem are doing enough to maintain cyber security defences when it comes to customer data in the era of Open Banking, according to a report from Accenture.The study, based on expert interviews and a survey of more than 800 banking industry professionals, focussed on the potential implications of Open Banking on security in the next three years.
Almost a year after the General Data Protection Regulation (GDPR) came into effect, RiskIQ has discovered that 1 in 10 personally identifiable information (PII) capturing websites belonging to the large UK financial services firms are running without adequate security measures. While this is down from the 27 per cent of sites identified a year ago, it is still in breach of the regulations.
Ant Financial, the finance arm of Chinese retail e-commerce giant Alibaba, has secured a virtual banking licence in Hong Kong.The Hong Kong Government and Hong Kong Monetary Authority granted the firm permission to operate virtual and digital banking services - which do not require a physical presence - from today.
Tink and NatWest have announced a new partnership giving the British bank access to the Swedish Open Banking platform’s personal finance management and data enrichment products. These will be integrated into NatWest’s core mobile banking app, allowing personalised customer insights based on transaction history. The features built with Tink’s technology are planned to go live in the fourth quarter of this year.
TPG has closed its TPG Tech Adjacencies (TTAD) fund, focused on the technology industry, reaching $1.6 billion in capital commitments. TTAD aims to provide flexible capital for tech startup founders and early investors looking for liquidity, as well as primary structured equity solutions for companies looking for additional, creative capital for growth.
Cryptocurrency platform Binance has confirmed that hackers have stolen 7,000 Bitcoin with a value of more than $41 million. In a statement posted early this morning, the Hong Kong based firm - which runs one of the world’s largest cryptocurrency exchanges - said cybercriminals had used phishing, viruses and other attacks to carry out the hack and obtain a “large number” of user API keys, 2FA codes and other information.
Facebook has announced that London is to become the focus of its drive to roll-out payments across its WhatsApp messaging service. WhatsApp is looking to recruit 100 new staff members in the capital as parent company Facebook continues with its push to monetise the social media messaging platform, which is used by 1.5 billion people globally.
Radical Ventures has launched a $350 million fund focused primarily on artificial intelligence (AI), backed by limited partners including the Canada Pension Plan Investment Board, the Public Sector Pension Investment Board, TD Bank Group and Wittington Investments. "AI is perhaps the most disruptive technology since electricity,” said Jordan Jacobs, managing partner at Radical Ventures. “It will transform the world, impacting everyone, and we are just at the beginning of its application.”
Technological changes colliding with other macro-economic and behavioural shifts could bring a £106 billion boost to the UK’s financial services sector by 2030, according to analysis from PwC. Of this estimated new business during the next 10 years, PwC estimated more than half will be driven by advances in insurance (£49.5 billion) and small to medium-sized enterprise (SME) lending (£4.1 billion) as firms operating in this area mobilise to meet changing consumer habits.
Political uncertainty has had a direct effect London-based tech firms’ ability to access capital, according to new research which has revealed a sharp fall in venture capital investment. Trade body Tech London Advocates found that 87 per cent of tech firms felt the Brexit process had tarnished London’s reputation as a business centre, while 39 per cent said it had become more difficult to access capital in the capital since the referendum.
The Co-operative Bank has announced more than 100 new jobs for IT and digital specialists in the North West of England, as it moves forward with plans to develop online and digital propositions. Roles are open to applicants with all levels of experience, from graduates to seasoned professionals, with applications encouraged from a wide variety of backgrounds. An ‘open doors’ event will be held on 8 May in the centre of Manchester, where the bank’s head office is based.
The government has announced a new Joint Authorities Cash Strategy (JACS) Group to “safeguard the future of cash and ensure its availability for years to come”, according to chancellor Philip Hammond. It also stated a commitment to act on the Access to Cash Review, which makes clear that “significant, expeditious action” is needed from government, regulators and industry to ensure that cash access and acceptance is maintained in the UK.
The UK’s tech businesses are confident of their growth prospects for the year ahead, despite the government’s “awful” handling of Brexit. Studio Graphene’s first quarter Tech Tracker Survey, which spoke to C-suite staff at more than 100 UK-based technology startups, revealed that businesses are either ‘very confident’ (39 per cent) or ‘confident’ (40 per cent) that they will increase their turnover over the coming 12 months.
The Royal Bank of Scotland (RBS) has launched Royal Bank Invest, a new online investment service that will allow investment from as little as £50. Customers will be able to link their investments to a financial goal and track performance online, with funds either self-selected or using automated advice. Investment will be either through one lump-sum, a monthly contribution or an ISA transfer.
Checkout.com has taken funding from outside investors for the first time in its history, raising $230 million, in what is Europe’s largest FinTech Series A round ever. The round was led by Insight Partners and DST Global, with participation from Singapore’s sovereign wealth fund GIC, Blossom Capital, Endeavor Catalyst and other strategic investors. The company will use the money to continue its growth in Europe, the US and the Middle East, with further expansion into Asia and Latin America.
Developments in financial technology such as Open Banking and digital finance apps could open the industry up to greater financial inclusion and consumer choice if widely adopted, according to a discussion paper published by the Financial Conduct Authority (FCA). The consultation paper issued by the banking regulator is aimed at exploring the changing financial needs and options available to consumers from different age groups.
Digital ID firm Jumio has struck a new multi-year agreement to provide regulatory technology to Monzo. Jumio has provided the challenger bank with artificial intelligence (AI) driven software provider to help meet strict Know Your Customer (KYC) and Anti-Money Laundering (AML) compliance mandates since 2017.
IBM and Thomson Reuters have announced a joint collaboration to help banks address ever-growing regulatory requirements through the combination of artificial intelligence (AI) and real-time regulatory insights. IBM and Thomson Reuters Regulatory Intelligence will now offer access to a RegTech solution delivered from the IBM Cloud that features real-time data from thousands of content sources. Backed by domain knowledge of Promontory Financial Group, the collaboration will enable risk and compliance professionals to keep pace with regulatory changes, manage risk and reduce the overall cost of compliance.
The chancellor has warned that “there is no room for complacency” to the UK’s FinTech sector, despite recent successes. Addressing the Innovate Finance Global Summit yesterday, Philip Hammond pointed out that international competition is growing – from Shanghai to San Francisco, Mumbai, Tel Aviv, Berlin and Paris.
Business-to-business (B2B) transactions processed by pureplay digital operators will reach $14 trillion by 2023, up from $6.7 trillion in 2018, as new entrants offer cheaper and faster services than established players in the space. This is according to market analysis from Juniper Research, which suggested that bank purchase departments can struggle to quantify return on investment from the implementation of digital technologies to replace, or augment, existing mechanisms. As a result, incumbents in the space are heavily reliant on manual processes and traditional suppliers.
While FinTech could help increase competition in financial services, some of the new solutions might also lead to the migration of activity outside the perimeter of prudential regulation. This was the view of Dave Ramsden, deputy governor for markets and banking at the Bank of England (BoE), speaking at yesterday’s Innovate Finance Global Summit in London.
Banking Competition Remedies (BCR), the independent body established to implement the £775 million Royal Bank of Scotland (RBS) State Aid Alternative Remedies Package, has announced the fourth and final application window for Pool C of the Capability and Innovation Fund. The Capability and Innovation Fund is designed to support the development of wider capabilities and competition in the small to medium-sized enterprise (SME) banking markets.
The Competition and Markets Authority (CMA) has given provisional approval to Paypal’s $2.2 billion takeover of Swedish mobile payments company iZettle. In November an investigation by the UK competition watchdog had raised concerns that the proposed merger could drive up prices for customers and lead to a more limited range of services.
Banco Santander has partnered with Microsoft Azure to drive its hybrid cloud strategy, as part of a €20 billion digital transformation plan. The Spanish-headquartered bank said the software giant’s cloud and artificial intelligence (AI) capabilities will improve customer service and operational efficiency as a part of a multi-year agreement.
Mastercard and Visa have agreed to cut payments fees for tourists using their cards in the EU, the European Commission’s competition watchdog has announced.The payments giants will reduce multilateral interchange fees (MIFs) imposed on consumer cards issued outside of the EU by around 40 per cent as a result of a ruling by the European Commission’s antitrust body.
Nationwide Building Society has invested in Ordo, a payment request service launching later this year, which connects billers to payers using apps and secure messaging. The investment is part of the building society’s £50 million Venturing Fund, designed to create partnerships in which it and startups share knowledge and expertise.
More than half (61 per cent) of financial services firms believe that automation is driving greater success in the sector, while close to three quarters (71 per cent) see the pace of technological change as a key enabler. IT and digital services firm Ricoh Europe surveyed 2,550 business leaders across 24 countries in Europe, Middle East and Africa on the role technology plays in driving efficiencies and employee empowerment.
Tech firms’ optimism dropped to a 10-year low in the first quarter of 2019, due to fears over a skills shortage and a subdued economy, according to a report from KPMG. Its quarterly monitor of business activity in the UK’s tech sector recorded the lowest levels of confidence in a decade for the three months to March, despite business activity growth recovering to its fastest pace since the second quarter of 2018.
International trade secretary Liam Fox has announced two new FinTech bridge programs with Australia and Hong Kong.The initiatives, which have been established in partnership with HM Treasury (HMT) and build upon existing frameworks, have selected 20 high-achieving UK startups and established FinTechs to reduce barriers faced as they undertake their international expansion.
Richard Theo, the government’s FinTech Envoy for Wales, has launched FinTech Wales, a not-for-profit independent membership organisation set up to champion the FinTech industry in Wales. Launched today at the Innovate Finance Global Summit in London, the association brings together entrepreneurs and businesses of all sizes, as well as technology suppliers, innovators, universities and public sector bodies.
The Financial Conduct Authority (FCA) has announced the eight FinTechs under consideration to test cross-border innovations as part of a joint global regulatory sandbox. In a speech to the Innovate Finance Global summit this morning, the FCA’s executive director of strategy and competition Christopher Woolard, said it would be joining forces with fellow banking regulators to launch the first tests overseen by the Global Financial Innovation Network (GFIN).
The governor of the Bank of England (BoE) has promised that it and the Prudential Regulation Authority (PRA) will evolve to meet the demands of new forms of financial technology. Speaking at the Innovate Finance Global Summit in London this morning, Mark Carney stated: “The UK’s FinTech companies are creating this new finance, but you cannot do it all on your own; your efforts will be even more effective if you have the right conditions in which to innovate and the level playing fields on which to compete."
FinTech Scotland and FinTech North are joining forces with Innovate Finance to form a national network aimed at connecting startups and FinTech innovators around the UK. The collaboration will focus on connecting the UK’s FinTech hubs outside of London to promote skills, investment and diversity initiatives and boost foreign direct investment (FDI) in the industry.
Real-time capital markets data analytics startup Mosaic Smart Data has completed a $9 million investment round to support its product development and global expansion. The round was co-led by CommerzVentures and Octopus Ventures, and also includes existing investor and client J.P.Morgan.
UK digital wealth manager Nutmeg is expanding into Asia by signing a partnership with Taiwanese bank Taipei Fubon. The deal will open up Nutmeg’s portfolio management and investment apps to Tapei Fubon’s five million customers, making it’s the first European digital wealth manager to access the Asian market.
Santander is launching the UK’s first telephone banking service to be verified with a combination of voice biometric security and phone ID. The telephone banking service, which is being rolled out in waves to Santander customers, will authenticate customers using a unique biometric marker.
The Open Banking data sharing transformation is set to evolve into more wide-ranging changes to the financial services industry, including Open Finance and Open Data, according to a panel of experts. Speaking at an event discussing the future of FinTech partnerships in Open Banking, Romi Savova, chief executive of pension consolidation platform PensionBee, predicted that the next 12 months will see incumbents and challengers alike focus on streamlining the processing of transactions using open Application Programming Interfaces (APIs).
Almost half of C-suite financial services executives (45 per cent) admit they do not know where to start when developing their digital transformation strategy. This is according to a survey of over 1,000 such executives and over 1,000 business analysts by Celonis, which found that many organisations have wasted significant resources on initiatives that have been poorly planned.
The head of GCHQ has called for closer co-operation between the financial services sector and the UK’s intelligence services to combat the threat of cyber attacks on consumers. Speaking at the CyberUK cyber security conference in Glasgow yesterday, Jeremy Fleming said GCHQ would seek to work more closely with banks, internet service providers (ISPs) and online platforms in order to “bake” cyber defences into business systems and increasingly “take the burden of cyber security away from the individual”.
Digital bank N26 is to open a new technology hub in Vienna to accelerate development of high performance security systems and new product offerings.The German challenger bank, which launched in the UK in November last year, said it would recruit more than 300 software engineers, product managers and IT specialists in Vienna to work on developing state-of-the-art security systems that can detect fraudulent transactions faster through the use of artificial intelligence.
Standard Chartered Bank is partnering with cloud technology platform Avaya to drive the development of its digital banking services.The international banking giant will use Avaya’s OneCloud private solution for its unified communications and contact centre services in order to offer a more joined-up service for customers that are increasingly moving to online and mobile banking.
SWIFT has appointed Javier Pérez-Tasso as its new chief executive. A member of the executive team for the past seven years, he currently serves as chief executive for the Americas and UK. He will take up his appointment on 1 July, in place of Gottfried Leibbrandt, who announced his intention to step down from the post at the end of June in December 2018.
Japanese megafund SoftBank has signed an agreement with Wirecard for an investment of €900 million in the German payments processor via a convertible bond mechanism. They have also signed a memorandum of understanding on a strategic partnership for digital payment solutions, with SoftBank seeking to support Wirecard’s geographic expansion into Japan and South Korea, as well as providing collaboration opportunities within SoftBank’s global portfolio in digital payments, data-analytics, artificial intelligence and other digital financial services.
US card issuing platform Marqeta is expanding into Europe with the launch of a digital banking service for FinTechs. Announcing the launch of its open Application Programming Interface (API) in Europe, Marqeta revealed that France’s Morning Bank, Spanish point of sale (PoS) service Aplazame and Swiss FinTech YAPEAL were the first three companies to sign up to its platform.
Digital admin assistant ANNA Money has partnered with Application Programming Interface (API) provider TrueLayer to provide the former with Open Banking-based services, including account aggregation and financial data which will make VAT calculations via its app much faster. There are also potential plans to integrate TrueLayer’s Payments API into ANNA’s platform, letting customer make and receive payments more securely.
European governments need to take urgent co-ordinated action with the private sector and wider society to deal with the most pressing challenges of the 21st century - including preparing citizens for massive technological developments, digital disruption and climate change - according to a group of leading European businesses. A new report from the European Round Table of Industrialists, a group of 55 major European businesses whose members include Heineken, L’Oréal, Nestlé and Rolls Royce, highlighted the need to strengthen the peace and prosperity offered by European unity in the last seven decades and called for joint action in the face of wide-ranging digital and environmental disruption.
Two thirds of Europeans have faith that cryptocurrencies will still exist in 10 years’ time, however the majority are still uncertain to how they will be used. The research, commissioned by Bitcoin exchange bitFlyer, polled 10,000 respondents across the UK, Belgium, Denmark, France, Germany, Italy, Netherlands, Norway, Poland and Spain.
Visa has launched a new platform with beta Application Programming Interfaces (APIs) and development tools to help issuers and issuer processors build and test new digital payment products. The platform will be available to the payment giant’s clients and partners via Visa Next, a new location for accessing new solutions in its product pipeline.
The Financial Conduct Authority (FCA) is “not in the business of picking winners”, its chief executive has said in a speech setting out the regulator’s outlook for innovation, competition and approach to Brexit. Making the address at Bloomberg’s London headquarters this afternoon, Andrew Bailey outlined how the emergence of behavioural economics and insights from psychology have changed the regulatory debate on competition, and how authorities must balance the need to set rules for the public good with the demands of innovation and new technologies.
T-Mobile has launched a new mobile-only current account for its US customers. The no-fee account offers a four per cent annual percentage yield on balances up to $3,000 and one per cent on every dollar over that amount, when at least $200 is deposited each month. Pitching itself against traditional bank overdraft and account fees, the telecoms giant is also offering overdraft protection when customers sign up for T-Mobile MONEY, giving up to 30 days and $50 of leeway to get back into the black.
More than three in every five companies (61 per cent) suffered a cyber security incident in the last year, with average losses rising from $229,000 in 2018 to $369,000 in 2019, according to the latest cyber readiness report from Hiscox. The insurance firm surveyed more than 5,400 private and public organisations in the US, UK, Belgium, France, Germany, Spain and the Netherlands, finding a 45 per cent increase in reported cyber incidents since last year.
Nationwide Building Society has selected seven FinTechs to take part in its Open Banking for Good challenge, developing apps and services to help financially vulnerable people. The companies have been chosen from more than 50 applicants and are divided among three categories: Income and expenditure: Openwrks and Ducit.ai; Income smoothing: Trezeo and Flow; Money management: Toucan, Squad and Tully.
The vast majority of organisations are struggling to secure value from their Intelligent Automation (IA) activities, with more than a third (38 per cent) of companies confirming investments of more than £7.7 million. A survey of nearly 600 business leaders across 13 countries - including 42 vice president, director and C-Suite executives in the UK - conducted by KPMG International and HFS Research, found that only around a fifth (22 per cent) of companies have scaled up or industrialised IA technology.
US federal government blockchain spending will grow from $10.7 million in 2017 to $123.5 million in 2022 – an overall compound annual growth rate of 63.1 per cent. This is according to analysis from market intelligence firm IDC, which also predicted state and local government blockchain spending to grow from $4.4 million in 2017 to $48.2 million in 2022.
Imandra has completed a $5 million seed investment round, led by AlbionVC, IQ Capital and LiveOak Venture Partners. The capital will be used towards further growth in financial services and applications of its artificial intelligence (AI) technology for autonomous vehicles, robotics and machine learning. It will also support Imandra’s expansion in both the US and the UK, with significant hiring of AI, engineering and product talent in Austin, London and Edinburgh.
US payments infrastructure company Stripe has acquired a Dublin-based software company Touchtech Payments in preparation for Strong Customer Authentication (SCA) regulations in Europe. Touchtech provides advanced SCA-ready authentication technology for FinTechs and challenger banks like N26, Transferwise and others.
InsurTech startup Cytora, which uses artificial intelligence (AI) to power its commercial insurance underwriting platform, has raised £25 million in a Series B funding round. The investment was led by EQT Ventures, with participation from existing investors Cambridge Innovation Capital and Parkwalk, along with unnamed angel investors.
More than half of small and medium-sized businesses (SMBs) say a data breach or cyber security incident would put their business at risk of closure. A Censuswide survey of 501 IT decisions-makers, commissioned by IT security firm Webroot, also found that more than three quarters of SMBs (78 per cent) believe that their business could be jeopardised by a lack of cyber security knowledge on the part of their employees.
A group of FinTech firms have set up the European Third-Party Provider Association (ETPPA), a new entity that strengthens Third Party Providers’ (TPP) interests around the second Payment Services Directive (PSD2). The ETPPA formalises the existing Future of European Fintech (FoEF) coalition into an official non-profit TPP trade association.
The Financial Conduct Authority (FCA) has published its Business Plan for 2019/20, outlining key priorities for the coming year, including a focus on enhancing the use of technology and data. The UK’s regulator also set out its research agenda for the next 12 months, which included artificial intelligence (AI), quantum computing, distributed ledger technology (DLT) and regulatory technology (RegTech).
Nearly three quarters (71 per cent) of all banking interactions are now digital, with a majority of customers carrying these out on a smartphone, tablet or wearable device, according to FIS. The FinTech provider, which recently purchased Worldpay in a $43 billion merger deal, commissioned a survey of 1,000 banking customers regarding their expectations of digital banking and payments.
Now in their 7th year, the 2019 Payments Awards are open for entries, with an expanded selection of categories to choose from. Celebrating the companies which have demonstrated excellence and innovation in the payments space, this year the awards will be welcoming entries in four new categories: Anti-Fraud Solution of the Year; Security Innovation of the Year; Best Cross-Border Payments Solution; and Blockchain or Cryptocurrency Initiative of the Year.
Facebook has confirmed that it is closing down its peer-to-peer (P2P) payments service on Messenger. The social media giant informed users that the payments service, which launched in the UK in November 2017, two years after it was first rolled out in the US, was being discontinued.
Eight in 10 chief information officers (CIOs) are worried about the need for advanced tech skills, as the workforce struggles to keep up with the pace of technological development, according to Barclaycard. A YouGov survey of 100 CIOs in large UK companies for Barclaycard found that 78 per cent were worried about the need to continually upskill staff in an uncertain market, while a similar percentage (76 per cent) voiced concerns about sourcing the right talent when the competition for employees with the right knowledge, skills and experience is increasingly fierce.
Home finance platform Youtility has been selected as one of four providers to participate in the Citizens Advice product testing programme. The project will see the clients of four Citizens Advice Bureaus - Bassetlaw, Hammersmith and Fulham, Cardiff, and Vale and East End - trial digital tools designed to help users budget, while testing the providers’ switching services for better home finance deals.
Finablr has confirmed its intention to proceed with an initial public offer (IPO) on the London Stock Exchange's main market for listed securities. The offer will be composed of new shares to be issued by the United Arab Emirates-based payments and foreign exchange company, as it aims to raise gross proceeds of $200 million. It intends to use the net proceeds from the issue of the new shares to finance further expansion plans and reduce net debt.
Nearly three quarters (72 per cent) of companies now have a majority of employees accessing cloud services via their mobile devices, according to a new study. A survey of 404 chief information officers (CIOs), chief information security officers (CISOs) and heads of network architecture in the UK, Germany, France and the Benelux region, for network security firm Zscaler, found a growing number of firms are enabling access on mobile devices.
NatWest has announced the launch of a new biometric payment approval feature, which allows business and commercial banking customers to make payments of any size through their Bankline Mobile app using Face ID or Touch ID, without the need for a card reader. The new feature also allows businesses to authorise multiple users to setup payments, which business owners can then subsequently approve on the go through their app.
TSB has announced a fraud guarantee scheme to cover customers who fall victim to any type of transactional fraud.The fraud guarantee, the first such move from a UK bank, is aimed at ensuring that its 5.2 million customers are refunded if they are an innocent victim of fraud, including unauthorised transactions or instances where they are tricked into authorising payments to fraudsters.
Trussle has named veteran banker and FinTech executive Simon Williams as new its new chairman and product technology executive Supriya Uchil as a new advisor to help accelerate its growth. The online mortgage broker also announced three-fold year-on-year revenue growth plans to develop new products.
Lloyds and Halifax have launched Open Banking app functionalities to allow customers to see their account balances with other banks in one place.Customers using their mobile banking apps will be able to view accounts and transactions with RBS, HSBC, Barclays, Santander and Nationwide, without the need for multiple logins, as part of new financial data sharing functionality.
Cyber criminals are targeting financial services firms more than any other sector, with a new report finding that finance accounted for 30 per cent of all attacks in the last year. A global threat intelligence report from NTT Security, based on billions of data points from organisations in 18 industry sectors across its security network, revealed that finance has knocked business and professional services from the top spot in Europe, Middle East and Africa (EMEA) cyber attack rankings for the 12 months between October 2017 and September 2018.
US InsurTech plaform Lemonade has secured $300 million in a Series D funding from SoftBank, taking the firm’s total funding to $480 million. Founded in 2015, the company uses artificial intelligence (AI) and behavioural economics to provide full-stack property and casualty insurance via a digitised policy process, based on predictive data to assist with underwriting and pricing.
Almost 40 per cent of businesses in the financial services industry are currently failing to implement data initiatives due to a lack of employee skills. Analytic database firm Exasol commissioned Vanson Bourne to survey 500 IT and business decision-makers in Germany and the UK, finding that 46 per cent are struggling with poor data quality and 32 complained about it being siloed within their organisation.
Cryptocurrency platform Coinbase has launched a Visa debit card allowing users to use cryptoassets such as Bitcoin to make real-world purchases.The card uses a customer’s cryptocurrency balance in Bitcoin, Ethereum, lite coin or other virtual currencies and converts it into pounds to pay in-store and online.
N26 has become the latest major FinTech challenger to encounter regulatory scrutiny, following reports that German regulator BaFiN has called for reforms at the the digital challenger bank.Inquiries into operations in the bank, which launched in the UK in November last year, have reportedly highlighted a number of issues.
Overall venture capital (VC) investment dropped from record heights of US$71 billion in the fourth quarter of 2018 to $53 billion in the first quarter of 2019, due to a decline in Chinese investment, among other factors. The latest KPMG market analysis revealed that while US and European investment remained relatively robust quarter over quarter, Chinese VC fell from $10.1 billion in the fourth quarter last year to $5.8 billion in the first quarter of this year, as ‘megadeals’ took a pause.
Nearly half (49 per cent) of financial services decision-makers would prefer to use outsourced technology solutions, rather than building teams to develop them in-house, according to new research. Asset Control commissioned OnePoll to survey 100 senior financial services staff in the US and Europe, finding that outsourcing has gained in popularity in recent years, with 48 per cent saying key benefits included being able to draw on a third party’s industry knowledge.
The business value of artificial intelligence (AI) in banking is projected to reach $300 billion by 2030, but around 500,000 UK bank workers’ jobs could be at risk by that time. IHS Markit analysis estimated AI in banking business last year at $41.1 billion, which includes the cost savings and efficiencies of introducing AI, compared to keeping existing infrastructures and processes.
MoneySuperMarket has launched a new remortgage platform, the first step towards delivering the first digitised ‘comparison-to-completion’ remortgage. The new proposition is a key part of the group’s ‘Reinvent’ strategy and is powered by Podium, the FinTech startup established in July 2018 as a joint venture between MoneySuperMarket and the founders of HD Decisions, Matt Denman and Mark Hawkins, who created the industry standard for cards and loan ‘smart search’ eligibility.
JPMorgan is launching real-time payments across its European banking network.The roll-out of the Single European Payments Area (SEPA) Instant service means the bank now offers real-time payment capabilities in US Dollar, Pound Sterling and Euros.
A new report from SWIFT has highlighted key improvement in banks’ cybersecurity measures, with the average value of attempted fraud transactions falling dramatically in the last 15 months.The latest study of cyber threats facing the global financial community showed that approximately 70 per cent of attempted thefts from bank accounts in the past 15 months were US dollar based.
New research has revealed that 86 per cent of consumers would consider leaving their bank or building society if they couldn’t manage their account easily online. Fiserv commissioned LM Research & Marketing Consultancy to survey 1,000 UK adults in January, finding that 82 per cent expect every digital experience to be equal to or better than what they receive from other technology providers.
Apiax has hired a former Financial Conduct Authority (FCA) expert on regulatory technology and is opening a new office in London. Alan Blanchard, who joined last month, will be put in charge of business development in the UK market. At LexisNexis he implemented a ‘digital first’ strategy within tax and compliance publishing, and was later responsible for digitising the FCA’s Handbook to facilitate RegTech.
Physical attacks on ATMs have risen for the fourth consecutive year, up 27 per cent when compared with 2017, from 3,584 to 4,549 incidents. The European Association for Secure Transactions (EAST) reported that losses due to ATM related physical attacks were €36 million, a 16 per cent increase from the €31 million reported during 2017.
New research has revealed that 42 per cent of financial management platform users have more than one bank account, as they take advantage of technological innovation and data sharing in financial services. Analysis of 3,000 Moneyhub users with multiple bank accounts found that while many more people are joining digital challenger banks, 65 per cent of those challenger bank customers also still have accounts with their previous High Street lender.
Standard Chartered is renewing its focus on Open Banking through partnerships with developers, corporations and FinTechs, as well as through Application Programming Interface (API) enabled financial data sharing. The bank said its aXess platform would offer developers access its source code for banking products and its API libraries. The aXess Labs, based in Bengaluru, India, will host in-house developers, accelerate ideation to service delivery, enable new business models, and share Open Banking best practices across the company.
The Competition & Markets Authority (CMA) has issued directions to five banks relating to delays in delivering certain aspects of the Open Banking programme, in particular with regard to mobile app functionality. Using its powers under the Retail Banking Market Investigation Order 2017, the CMA reprimanded Bank of Ireland, Danske, HSBC, Lloyds Banking Group and Santander for breaching deadlines for app-to-app redirection functionality, forcing users to rely on desktop-only data sharing.
Mortgage investment platform LendInvest has secured funding of up to £200 million from HSBC.The FinTech said the investment would enable the company to enter the regulated home loan market for the first time, marking the company’s next step towards its goal of becoming a whole-of-market mortgage provider.
European fraud experts have called on EU regulators to put on hold the implementation of the European Banking Authority (EBA) Guidelines on Fraud Reporting under the second Payment Services Directive (PSD2) until the revised European Central Bank’s (ECB) Regulation on Payments Statistics come into force. In a note issued today, 18 account-servicing payment service providers (AS-PSPs) from 10 European countries have recommended steps to minimise fragmentation risks and ensure both maximal legal certainty and longer-term viability for the implementation programmes that providers and national authorities are putting in place for fraud reporting.
The gradual shift of BigTech giants into financial services has the potential to be a “game changing development” for the industry, according to a new report from the Bank for International Settlements (BIS). The Basel-based institution, which sets out policy and banking services for the world’s central banks, conducted a study into the entry of big technology companies into financial services, which found that regions with “less stringent” banking regulation - including China and Latin America - are ahead of Europe and the United States when it comes to credit services.
This year, London will be home to just as many FinTech ‘unicorns’ as current global leader San Francisco. A new report from global recruiter Robert Walters and market analysis firm Vacancy Soft has shown that of the 29 FinTech unicorns worldwide - companies worth more than $1 billion - nine are in San Francisco, while seven are based in the UK.
Refinitiv research has revealed that while the overwhelming majority of financial sector executives have deployed machine learning, most also acknowledge that poor-quality data is impeding their ability to fully leverage the technology. The global survey among 450 c-suite leaders and heads of data science departments - including 161 from Europe - found that 43 per cent said data quality the biggest barrier to adoption, followed by a lack of data availability (38 per cent) and a lack of available data scientist staff (33 per cent).
Starling Bank is partnering with accounting software firm FreeAgent in the latest addition to its marketplace for third party apps. The tie up means Starling’s 40,000 business customers will be able to access FreeAgent’s accounting platform and link their account data via Starling’s Application Programming Interface (API) marketplace.
Monzo is set to overtake Revolut as the UK’s second-highest valued FinTech after reportedly securing £100 million in its latest funding round. According to the Sunday Times, the funding, led by a new US investor, will drive the valuation of the digital challenger bank to $2.5 billion, ahead of Revolut’s $1.7 billion, and second only to B2B lending challenger Oaknorth as the UK’s most valuable FinTech.
Financial simulation startup Simudyne has announced a $6 million Series A funding round, led by Barclays.Graphene Ventures, an early investor in Snap and Lyft, and Gauss Ventures, early investors in Revolut and Tandem, also contributed to the round, bringing total capital raised since Simudyne was founded in 2007 in to $10 million.
New research has revealed that 95 per cent of chief information and chief information security officers in the UK admit they make compromises in how they protect the business against cyber threats and other disruptions. Endpoint security specialist Tanium surveyed 500 people in those positions, finding that 35 per cent cited pressure to keep the lights on, while 31 per cent suggested they were restricted by legacy IT commitments.
RBS and Barclays have participated in a global trial of blockchain technology which claims to be able to cut the buy-sell period from three months to less than three weeks.The lenders joined 40 global financial and professional services firms, including Swiss Re, AXA and Clifford Chance, to test the application of distributed ledger technology (DLT) developed by Instant Property Network (IPN), a property transaction network.
The Competition and Markets Authority (CMA) is considering an investigation into Visa’s £247 million takeover of cross-border payments firm Earthport. The competition watchdog said a potential inquiry into the merger would result in a “substantial lessening of competition” in the market.
Big Tech companies such as Amazon and Google are more trusted by the public than traditional banks, according to a new survey, suggesting that new financial products such as the Apple Card could pose a challenge to incumbents.Following the announcement that Apple is launching a credit card service to the US market last month, a Harris 24 survey of 542 consumers revealed that 39 per cent had ‘a lot or a great deal of confidence’ in tech firms, compared with the 31 per cent who said they trusted credit card companies.
InsurTech-focused venture capital firm IA Capital Group has raised $150 million across three funds. The Inter-Atlantic Stonybrook Insurtech Ventures fund will focus on property and casualty InsurTech, the Inter-Atlantic G fund will focus on life, annuity and retirement InsurTech, and the Inter-Atlantic Ivy fund will focus on later-stage opportunities in InsurTech and FinTech.
Santander has announced that its European divisions, which includes Santander UK, will shoulder a reported €1.2 billion of cost cutting in the next four years, as the Spanish banking giant steps up plans to invest more than €20 billion in digitisation and technology. Santander UK could face further cuts as its parent company looks to “simplify, digitalise and automate” the group.
Ministers have called on businesses to take further action to protect themselves against cyber crime despite a government survey showing that the percentage of UK businesses experiencing cyber security breaches fell to just under a third (32 per cent) from 43 per cent last year.The results of the Department for Culture Media and Sport’s annual cyber crime survey revealed that moves from UK businesses and charities to upgrade their defences following the introduction of tough new laws have driven down the overall number of reported breaches in 2019.
More than half of retail banks are looking to collaborate with FinTechs to advance their own digital banking offerings, with 56 per cent expecting that incumbent/FinTech sandboxes will become mainstream by 2025. An Economist Intelligence Unit survey of 405 global banking executives on behalf of banking software firm Temenos revealed that retail banks now rank adoption of new technologies as a more pressing priority than regulation and changing customer demands.
More than half of all UK consumers have at least one bank account they no longer use, but have not yet closed, as many open new accounts with challenger banks because they offer enticing personalised features. The research, commissioned by Crealogix and undertaken by Censuswide among 2,000 people aged 18 to 65 who currently have a bank account, found that 57 per cent of respondents admitted to having at least one bank account they have not accessed in the last three months, while a quarter of Generation Z and Millennial-aged people have two or more accounts that are currently not in use.
Barclays, BBVA, Deutsche Boerse and SWIFT are among those from the financial services sector to join the newly-founded International Association for Trusted Blockchain Applications (IATBA). More than 100 organisations from a variety of industries have signed up to the organisation, which grew out of a series of meetings held by the European Commission.
Derivatives analytics firm OpenGamma has raised $10 million in a funding round led by FinTech and B2B software backer Dawn Capital.The funding round includes participation from existing investors Accel, CME Ventures and ex-SunGuard chief executive Cristóbal Conde.
The European Commission (EC) has launched a new cross-border initiative encouraging collaboration between national regulators and governments on to grow the FinTech economy. The European Forum for Innovation Facilitators (EFIF) is aimed at supporting regulators to share information and work together on plans for innovation hubs and regulatory sandboxes.
New research has revealed that 83 per cent of mobile financial applications store data insecurely, with 97 per cent failing to include binary protection which stops hackers from reverse-engineering the software. Application security provider Arxan commissioned advisory firm Aite Group to analyse the market, finding that 90 per cent of apps unintentionally leaked data to other apps, while 80 per cent used weak encryption and 70 per cent used weak random-number generation.
Israeli startup FinCom.Co has launched its anti-money laundering (AML) fingerprint technology in the UK, gaining market access through the London Stock Exchange’s Issuer Services Marketplace. Developed for highly regulated sectors, the AML platform utilises advanced mathematics with phonetic fingerprint recognition to aid customer verification and compliance in real time.
Financial services compliance departments should accelerate their uptake of new technologies such as artificial intelligence (AI), Natural Language Processing (NLP) and RegTech solutions to cut costs, according to Accenture. A survey of 151 compliance executives at financial services institutions found that over two-thirds (68 per cent) of their compliance departments are facing a cost reduction target, while 69 percent of these looking to make savings of between 10 and 20 per cent over the next three years.
Biometric payments company FingoPay has announced that Manchester will be the first city in the UK to trial finger vein payments.The FinTech, owned by Sthaler, has developed a Hitachi-backed payment systems which allows shoppers to pay with a scan of the vein signatures in their finger, removing the need for cards, apps or pin numbers. The advanced security offering also removes the need for transaction limits.
Blockchain-based mortgage platform Acre has secured £5 million in funding from insurance giant Aviva and financial advisor Sesame Bankhall Group (SBG).The FinTech, which uses blockchain to build a “record of transaction” of the elements of the mortgage application process, says it will use the investment to grow the platform.
In 2019, the majority of banks have made significant progress in digitalising their retail product line, with 65 per cent of digitally active large banks reaching the ‘digital promised land’, according to Temenos. This represents a significant shift from 2017, when the banking software company ranked the majority of banks as ‘legacy lovers’ or ‘under achievers’.
The European Banking Authority (EBA) has published a series of clarifications to issues raised by its joint working group on Application Programming Interfaces (APIs) under the second Payment Services Directive (PSD2). The issues raised in today’s update relate to the performance and support of APIs, which enable financial data sharing, as well as the provision of a list of Third Party Providers (TPPs) that are interested in testing, and the testing by TPPs that is not authorised.
Fourteen global financial institutions - including HSBC, Lloyds, Deutsche Bank and Standard Chartered - have joined together to launch an initiative which aims to use technology to open up trade finance as an asset class for the institutional investors.The Trade Finance Distribution Initiative (TFD) will initially focus on creating common data standards and definitions to enhance operational efficiency and improve risk management associated with establishing trade finance as an asset class.
TSB is to end IT outsourcing projects and bring control of its banking platform and technology back in house, after a series of IT meltdowns left millions of customers locked out of their online banking last year. In a statement, the bank said it was discontinuing arrangements with with Sabis, a tech subsidiary of parent company Banco Sabadell and other technology partners.
NatWest is trialling a new companion to the NatWest app called Mimo, designed to help customers enjoy financial peace of mind. Mimo will help customers budget, remind them of the financial tasks they need to do, and provide proactive and personal insights into their money, looking at their bills or day-to-day spending – as well as insurance, subscriptions and utilities.
Banking incumbents which are slow to upgrade their infrastructure could take a 30 per cent hit in revenue, as challengers gobble up more of the market for innovative digital banking services, according to Citibank. A new report from the US-based bank has demonstrated a growing need for established banking players to develop their own standalone digital-first brands in order to fend off the growing number of FinTech challengers, such as Monzo, Starling and Revolut.
The Information Commissioner’s Office (ICO) has opened the beta phase of its regulatory sandbox, designed to support organisations using personal data to develop innovative products and services. Participants will be able to work with the ICO’s specialist staff to help ensure they comply with data protection rules, providing some comfort from enforcement action and, where feasible, increased public reassurance that products and services are not in breach of data protection legislation.
Over one third of IT decision-makers (ITDMs) in the UK’s largest financial services firms believe that artificial intelligence (AI) will transform the industry in the next decade – but the same percentage admitted that their infrastructure is not prepared for the transformation. A Censuswide survey of 200 ITDMs for data centre firm Digital Realty also found that they thought the potential for AI to transform their business functions outweighs the disruptive potential of other technologies.
Challenger bank TSB would need a three-year turnaround and cost-cutting plan before it could be a candidate for sale or consolidation, according to the chairman of parent group Banco Sabadell. The High Street lender last year saw chief executive Paul Pester stand down after a series of IT outages left 1.9 million customers locked out of online banking, costing the company £330 million.
Klarna has launched its own Open Banking Platform, giving access to more than 4,300 European banks through a single Access to Account (XS2A) Application Programming Interface (API). The XS2A API has been developed at scale across markets for almost 15 years through the Klarna Group company Sofort. It has transferred over €10 billion in volumes and completed over 100 million transactions for 2018 alone.
The European Insurance and Occupational Pensions Authority (EIOPA) published its report on best practice among authorities licensing InsurTechs across Europe. As part of the European Commission's Fintech Action Plan, the document presents a mapping of current authorising and licencing approaches to financial innovation, including an assessment of how the principle of proportionality is applied in practice. It also includes an analysis of the approach to InsurTech startups operating as peer-to-peer (P2P) insurers.
The Hong Kong Monetary Authority (HKMA) has granted its first tranche of virtual banking licences.The first Hong Kong-based institutions to have received licences to operate under the Banking Ordinance are Livi VB, SC Digital Solutions and ZhongAn Virtual Finance. The licences will enable them to operate in the form of a virtual bank from today.
FinTech challengers Starling, Monzo and Revolut have led the list of tech firms joining the government’s Future 50 startup programme. The mobile-only banks are among 24 new entrants for this year’s programme, which backs 50 of the UK’s fastest-growing late-stage tech startups in their efforts to scale-up by enabling contact with senior government decision-makers and a peer-to-peer network.
Adobe and Microsoft are teaming up to launch an integration with LinkedIn for their marketing solutions, as the software giants look to rival Salesforce.The collaboration is the latest joint initiative from Microsoft and Adobe as they combine sales and marketing offerings. It will let users of Adobe’s marketing software improve targeting of potential customers in LinkedIn, which is owned by Microsoft.
Nutmeg has announced plans to democratise its company ownership with a crowdfund later this year. Working in conjunction with Crowdcube, the digital wealth manager will give eligible customers the opportunity to invest alongside existing institutional shareholders such as Convoy, Taipei Fubon Bank, Goldman Sachs and Balderton Capital.
The Payment Systems Regulator (PSR) has published its Annual Plan and Budget for 2019/20, announcing a more direct focus on consumers’ experience of payments, having spent its first few years on access to payment systems and the way infrastructure works. It explained that an agile approach and willingness to adapt will help the people and businesses that rely on payments.
Citigroup has announced it is developing a digital consumer payments service for financial institutions.The move will offer institutional merchants the ability to collect from a range of payment methods, including cards, e-wallets and new bank transfers such as Request to Pay and Open Banking.
Payments startup Wi5 has raised £8 million in a seed round to drive growth of its platform. The investment was led by West Hill Capital. The London-based FinTech, which counts telecoms provider Telefonica amongst its backers, said it would use the money to expand its mobile engagement platform, which allows customers to place orders and payments on-site without the need to download an app.
New research has revealed that 87 per cent of IT decision-makers believe that technologies powered by artificial intelligence (AI) should be subject to regulation. A study of 300 ITDMs from the UK and US commissioned by integration platform SnapLogic found a growing need for firms to focus on corporate responsibility and ethics it the development of AI solutions, with 94 per cent saying more attention needs to be paid to this area.
More than a third of financial services jobs in The City of London are at risk of automation, according to a study by the Office for National Statistics (ONS). The analysis concluded that 1.5 million jobs in England were at high risk of having some of their tasks automated, with 710,000 jobs located in The City’s financial services hub being under threat.
International payments startup Airwallex has raised a $100 million investment, led by DST Global, tipping it into a $1 billion ‘unicorn’ valuation. The Australian-based cross-border payments specialist also counted Sequoia Capital China, Tencent, Hillhouse Capital, Gobi Partners, Horizons Ventures and Square Peg Capital as investors.
Apple is launching a credit card that will be integrated into its mobile wallet and promises to help customers lead a "healthier financial life". Available in the US this summer, the titanium Apple Card is a built into the Apple Wallet app on iPhones and offers a simple application process, no fees, financial management tools and privacy controls.
Monzo is putting a halt to its plans to join the UK’s Cheque Image Clearing System, for a focus on building its business banking.The FinTech unicorn announced it had started developing plans to join the image clearing system in June last year.
Digital challenger bank Tandem Bank has partnered with Open Banking platform provider, Token.io to comply with the second Payment Services Directive (PSD2). Having hit the 14 March deadline for technical specifications, support and a testing facility, Tandem is now looking to look beyond core compliance, developing new services that make use of new opportunities around payments Application Programme Interfaces (APIs).
Three quarters (74 per cent) of consumers aged over 55, and 57 per cent of low-income earners, never use mobile banking apps, according to Accenture. The consultancy’s UK survey of 3,000 consumers also found that a quarter (26 per cent) of over 55 and low-income earning consumers said they never use online banking.
Italian payments group SIA is considering an Initial Public Offering (IPO) and further acquisitions, as part of an ambitious three-year strategic plan. Shareholders have agreed on growth ambitions, with a decision due this summer on whether or not to float the company.
Monzo is partnering with OakNorth to launch a range of savings account products to customers in the UK. The tie-up between the two digital banking challengers will allow Monzo’s 1.6 million customers to open a Cash ISA and other services via OakNorth’s savings platform. OakNorth has 40,000 savings customers on its digital platform.
The finance industry prevented £1.66 billion of unauthorised fraud during 2018, according to UK Finance. During the same period, a total of £1.2 billion was stolen by criminals committing both authorised and unauthorised fraud.
Incumbent institution J.P.Morgan and growing startup Curve both came away with two awards each at last night’s FStech Awards. The 19th annual industry gathering, celebrating the best of financial services technology, took place at London’s Marriott Grosvenor Square.
Worldpay is teaming up with Amazon Pay, making it the first acquirer to enable the e-commerce giant’s payment services for merchants.The agreement, which is launching initially in the US, will enable Worldpay merchants to accept payments through Amazon Pay using information already stored in a customer’s Amazon account to make purchases online.
The Prudential Regulation Authority and the Financial Conduct Authority have embarked on a joint pilot project to establish how distributed ledger technology (DLT) and Application Programming Interfaces (APIs) could be applied to regulatory functions.In a keynote address to the RegTech Live conference last month, Sholthana Begum, a technical specialist in regulatory technology at the Prudential Regulation Authority and Bank of England, told the audience that both regulators were collaborating to research how new technologies could be integrated into the compliance landscape of the future.
The potential for bias in the use of algorithms in financial services is set to be investigated by the Cabinet Office’s Centre for Data Ethics and Innovation (CDEI). The government body stated that algorithms have huge potential for preventing crime, protecting the public and improving the way services are delivered, but decisions made in these areas are likely to have a significant impact on people’s lives, so public trust is essential.
More than £6 billion is spent every year on cyber security testing by UK firms responding to a rise in the number of data breaches, according to figures from Avord. A survey of businesses by the cyber security testing firm found that 93 per cent had seen an overall increase data breaches in the last five years, with a third of companies experiencing a breach in the past year.
Millennials are increasingly using WeChat and WhatsApp to discuss their investments with wealth managers, according to GlobalData. The data and analytics company’s latest investor survey revealed that almost 40 per cent of Millennials in Asia Pacific were contacting their wealth managers via a chat application in the second quarter of 2018, a 10 percentage point increase on the same period in 2017.
European firms are lagging behind their Asian and US peers in the race to comply with data-privacy regulation, according to a report from Ant Financial and The Economist Intelligence Unit. The joint study surveyed by 250 chief executives in China, the US, Western Europe and South-East Asia to asses levels of preparedness amongst firms for data regulation, such as the EU’s General Data Protection Regulation (GDPR).
Curve has announced plans to expand internationally by opening six offices across Italy, Germany, France, Spain, Portugal and Poland. The FinTech startup, which lets users combine their credit and debit cards into one card and smart app, has also appointed Alaister Mortlock as its head of talent. Previously at LinkedIn and Centrica, he will manage the talent acquisition for Curve.
Chatbots, artificial intelligence advice services, wearables and biometrics will transform the way consumers manage their money in the future, according to a report from CYBG. The banking group commissioned a Censuswide survey of more than 2,000 UK consumers, which found that 78 per cent of 16-34 year olds and 81 per cent of those aged 35 and over, said they valued being able to talk to a human as part of their banking experience.
Three quarters (73 per cent) of UK businesses believe that fraudsters who carry out payments fraud are now ‘ahead of the industry’, according to a report from Vocalink, a Mastercard company.The Populus survey of more than 500 senior decision makers of UK businesses found that despite one in five (22 per cent) firms reporting someone had previously attempted payments fraud on their business, plus a further one in ten (12 per cent) falling victim to this type of scam, many still lack the systems needed to deal with these intrusions.
IBM has announced Blockchain World Wire, a new real-time global payments network for regulated financial institutions. Designed to accelerate foreign exchange, cross-border payments and remittances, World Wire is the first blockchain network of its kind to integrate payment messaging, clearing and settlement on a single unified network, while allowing participants to choose from a variety of digital assets for settlement.
Cross-border payments firm InstaReM has closed a $41 million Series C funding round, aimed at supporting expansion of its teams in London and Latin America. The round was led by Singapore’s Vertex Growth Fund and supported by new investor Atinum, a South Korean venture capital fund.
NatWest plans to offer its small businesses and corporate customers a new virtual account platform in partnership with Nordic software company Tieto. The platform will support regulated professions - such as legal, accountancy and insurance firms - which need a safe and simple way of segregating their clients’ monies to comply with regulatory standards.
The European Banking Authority (EBA) has launched its central electronic register under the second Payments Services Directive (PSD2). The register will provide information on several thousand payment and electronic money institutions and 150,000 agents within the EU, with the objective of increasing transparency and ensuring a high level of consumer protection within the European Single Market.
A third of the UK’s small business are without any cyber security strategy, according to a new report that warns that a lack of preparedness for a cyber attack could cost firms and their users thousands of pounds. A study from corporate responsibility body Business in the Community found that 42 per cent of small business reported at least one attack or data breach incident over the course of 2018. In 17 per cent of cyber security incidents it took the business and its systems at least a day to recover from the breach.
SC Ventures, the FinTech investment unit of Standard Chartered, is launching a market-first platform to connect startups, investors and accelerators with the bank.The FinTech Bridge is aimed at combining its own innovation drives with the best solutions from the wider FinTech ecosystem.
Digital identity provider ForgeRock today has launched an Open Banking Sandbox-as-a-Service platform.The firm said the cloud-based testing environment for Application Programming Interfaces (APIs) is aimed at helping firms ahead of the 14 September deadline for financial services firms to achieve compliance with the next phase of the second Payment Services Directive (PSD2) regulation.
FIS and Worldpay have entered into a definitive merger agreement. Upon closing, FIS shareholders will own approximately 53 per cent and Worldpay shareholders will own approximately 47 per cent of the combined company, with the combination of stock and cash valuing Worldpay at an enterprise value of approximately $43 billion, including the assumption of its debt, which FIS expects to refinance.
Challenger banks One Savings Bank and Charter Court have announced the terms of a £1.75 billion merger set to create one of the UK’s largest specialist lenders. The deal will hand 55 per cent of shares in the combined company to One Savings Bank shareholders, while One Savings Bank’s chief executive Andy Goulding and chief financial officer April Talintyre will retain their roles in the new company.
German challenger bank N26 has appointed a general manager to boost its plans for further expansion in the UK, ramping up the competition with the likes of Starling and Monzo. Will Sorby has been appointed UK general manager with a brief to lead the next stage of N26’s expansion following the launch of its mobile banking app in the UK in November last year. The company claims to have seen more than 1,000 new customers register on a daily basis since the roll out began.
First Direct is giving customers a co-creation platform within its app, enabling direct involvement in developing new products and services. The new feature, called fdesign Mobile, means first direct can share updates with ‘fdesigners’, who can feedback on any proposed changes.
Incumbent players in the financial services industry must commit to open data protocols and collaboration with challengers if they are to survive, according to experts at the HPS Powercard Users Meeting in Marrakesh. Speaking on a panel assessing new trends in the payments space, HPS chief executive Abdeslam Alaoui Smaili commented: “Proper industry architecture is crucial – it has to be fully open or it will fail.”
Cryptocurrencies could pose a risk to financial stability and increase the number of risks faced by banks, according to the Bank for International Settlements (BIS). In a statement, the BIS’ Basel Committee, which develops regulatory standards for central banks around the world, said that the increasing in bank exposure to the spread of crypto asset trading platforms and crypto currencies such as Bitcoin is heightening the level of risk for financial institutions.
Network International, the digital payments company operating across over 50 countries in the Middle East and Africa, has announced that it is considering proceeding with an Initial Public Offering (IPO) on the London Stock Exchange’s (LSE) main market. The company has also appointed former Worldpay chief executive Ron Kalifa as its new chairman.
Barclaycard has announced a new agreement with Alipay, which will allow retailers to accept Alipay transactions in stores across the UK. Retailers will now be able to accept in-store Alipay payments without replacing their existing point of sale systems. Building on a pilot over the past two years, the new deal will enable UK retailers to take advantage of the growing volume and buying power of Chinese visitors.
UK companies that deploy business intelligence and data visualisation software get an average of 24 per cent more sales than those that don’t, new research has revealed. IQBlade analysed the UK’s fastest growing companies and the technologies behind their growth, finding that the average sales for those using business intelligence platforms in 2018 was £39 million, compared to £24 million for those that don’t.
The Bank of England’s failure to enforce compliance and modernise its IT systems risks undermining its credibility, according to MPs. A report into working culture and modernisation programmes at the central bank by the Commons Public Accounts Select Committee found that the 325-year-old institution is “years out of date”, dealing a blow to its ability to demand compliance from the industry.
The speed of bank and ATM closures is leaving society’s most vulnerable people and communities at risk of financial exclusion, the chairman of the Financial Conduct Authority (FCA), has warned.In an address to the Retail Banking Conference in London, Charles Randell, who heads the UK’s banking authority, said the government and regulators must take joint action to ensure millions of people living on low incomes, the elderly and individuals and businesses in rural communities are not left ‘unbanked’ as consumers switch to digital banking.
The UK Insurtech Board - an initiative facilitated by Tech Nation as part of the Fintech Delivery Panel (FDP) convened by HM Treasury - has launched a new toolkit of legal documents, designed to make it easier for insurance technology startups to forge commercial relationships with corporate partners.Having identified that early stage InsurTech ventures frequently lack legal support or consistent requirements when entering discussions with potential corporate partners, the Insurtech Board has created a suite of startup-friendly legal documents, which can be downloaded at no cost from the Tech Nation website.
Mastercard has entered into an agreement to acquire Ethoca. The Ethoca suite of products - that help merchants and card issuers collaborate in real-time to identify and resolve digital commerce fraud - will integrate with Mastercard’s existing fraud management and security products.
CreditDigital, a business-to-business (B2B) lending platform, has secured £2 million to fund its expansion from early stage venture capital fund Fuel Ventures. The London-based startup, founded by Daniel Lipinkski in 2017, has capitalised on the growing trend for instalment- based payment by offering businesses the opportunity to spread the cost of a purchase over 12 months, while paying suppliers and vendors up front.
The majority of banks felt that the implementation of an institutional FinTech solution had contributed towards achieving business goals by lowering operational costs (87 per cent) as well as improving regulatory compliance (67 per cent). This is according to a survey carried out among 10 banks and 142 FinTechs by ING UK and Illuminate Financial between December and January 2019, which found that 40 per cent of FinTechs agreed that reducing operational costs was the primary driver for banks adopting tech solutions, followed by improving regulatory compliance (21 per cent).
Lloyds, NatWest and Barclays are teaming up to pilot the UK’s first shared business banking hubs, helping support businesses hit by branch closures to make local cash and cheque deposits.The initial hub in Birmingham is the first of six scheduled to open in UK towns in the coming weeks as part of a joint initiative to enable small businesses and sole traders to pay in large volume of coins, notes and cheques in their local area.
Santander Asset Management (SAM) has reached an agreement with BlackRock to adopt its Aladdin platform as part of a wider technological transformation. The Aladdin platform will allow greater consistency and standardisation of risk management across all of SAM’s markets, providing clients with more transparent risk/return analysis, as well as more complete and timely reporting.
Mergers and acquisitions (M&A) activity amongst enterprise software and IT and business services surged to a five year high of $182 billion in 2018, driven by deals from Microsoft, Oracle, Adobe and SAP. Hampleton Partners, an international technology M&A advisory firm, found consistent growth in transaction volume, multiples and valuations of enterprise software deals.
Nationwide has enlisted SAS to analyse customer interactions more effectively so it can solve members’ problems earlier. A proof of concept was able to establish significant inefficiencies as more than half of all email enquiries could be resolved instead by guiding members towards digital channels.
Digital challenger bank duo Tide and ClearBank have announced plans to co-invest at least £120 million in the UK over the next five years, with the aim of increasing business banking market share. Tide is planning Series B and C investment rounds in the next two years to raise £60 million, stating that it has received expressions of investment interest from around 70 venture capital firms across the globe.
The UK has risen one place, to third, in a global ranking of most promising countries in the world for innovation, disruption and technology, according to a report from KPMG.The UK came in behind the USA and China in the accounting firm’s 2019 assessment of the countries expected to produce the most disruptive technologies, but managed to break away from closest rival Japan, which nearly tied the UK for fourth place in 2018.
As part of a national trial, NatWest is due to begin piloting biometric fingerprint technology with 200 customers in the coming weeks. Customers will use their fingerprint to verify transactions over £30, increasing security and making it easier for customers when paying for goods or services at the tills, as no PIN is required.
The Bank of England (BoE) is taking supervisory action against Visa over a major outage which halted payments for millions of consumers last June. The central bank said that it was using its statutory powers to ensure that Visa fully implements the recommendations of an independent review into the disruption to its card authorisations system.
RegTech firm Heliocor has raised $2.5 million using a novel funding technique used for the first time in the UK. The process includes investors participating in 20 per cent of Heliocor’s future profits after tax and their investments being represented as a digital token, using blockchain technology, rather than just a paper certificate, potentially providing significant liquidity should that token be listed.
The European Payments Council Board (ECPB) has approved UK Finance’s application for the continued participation of UK payment service providers in the Single Euro Payment Area (SEPA) schemes, including in a no-deal Brexit scenario. The decision will come as a relief to the UK’s payment provision firms, which had raised concerns that a no-deal Brexit could lead to UK businesses and consumers experiencing issues and higher charges when attempting to make and receive payments in Euros and maintain their Euro bank accounts.
The Treasury Committee has published a unanimously-agreed report on economic crime, including anti-money laundering supervision and sanctions implementation. It concluded that the official response must be more precise, with reform of several departments to create a more joined-up response to a variety of emerging threats.
Currencies Direct has launched a suite of Application Programming Interface (API) services. The UK-based payments provider’s platform is targeted at large corporates, startups and service providers which want to offer a complementary service for international payments.
Software provider Goldensource is tapping into Brexit uncertainty with the release of new data sets aimed at helping banks prepare for changed regulatory demands and compliance requirements in the event of a no-deal exit from the EU.With the UK’s planned departure scheduled for 29 March, the software firm says its Brexit-specific data platform will enable banks and financial institutions to report to the Financial Conduct Authority (FCA) and the European Securities and Markets Authority (ESMA) at the same time in the event that the UK leaves without a transitional deal in place.
IPC has made a strategic investment in GreenKey Technologies which will enable it to integrate artificial intelligence (AI) and natural language processing (NLP) technologies into its offering for financial services workflows. The investment gives the financial communications provider exclusive rights to GreenKey’s machine learning voice technologies, enabling IPC to deploy these alongside their trading communications and cloud financial ecosystem of over 6,400 market participants.
The Investment Association’s FinTech innovation hub Velocity has partnered with B-Hive, a Brussels-based FinTech network, to promote FinTech applications in Europe’s asset management industry. The joint working project will promote pan-European collaboration and closer relationships between the two organisations, with the goal of building a stronger international FinTech ecosystem via greater partnership between London and Brussels.
The Financial Conduct Authority (FCA) has today published two pieces of research looking at UK consumer attitudes to cryptoassets - such as Bitcoin or Ether - indicating potential harms, including the fact that many consumers may not fully understand what they are purchasing. The research includes qualitative interviews with UK consumers and a national survey, which found that several of those interviewed talked of wanting to buy a ‘whole’ coin, suggesting they did not realise they could buy part of a cryptoasset.
Insurtech UK, the industry’s new association, has revealed its latest associate members and partners. This body’s core membership now stands at more than 40 InsurTech industry stakeholders, with Lloyd’s of London, Hiscox, Holloway Friendly and Bascule all named as associate members ahead of a formal launch in the coming months.
Nationwide has invested £15 million in 10x Future Technologies as part of a Series B funding round, giving the building society a minority shareholding aimed at designing and building an innovative digital platform for new current accounts. Last year the society announced that it would launch a business current account in support of the UK’s 5.7 million small businesses. This partnership provides the digital platform, which will be launched towards the end of the year.
Rapyd has announced three new hires in an attempt to scale up and penetrate the FinTech market. The payment platform has appointed Helcio Nobre to chief product officer, Marc Winitz to chief of marketing, and Eran Nachshon to vice president of operations.
Barclays will introduce wearable payment devices to its mobile payment brand Pingit in May. New features will also be coming to Pingit to enhance the wearable experience, with users soon able to segment their account into ‘jars’ to set aside money for specific uses.
The Access to Cash Review has published its final recommendations, calling on the government, regulators and banks to act now or risk leaving millions behind. The review concluded that digital payments don’t yet work for everyone and around eight million adults - or 17 per cent of the population - would struggle to cope in a cashless society.
Financial services firms are lagging behind in digital transformation compared to other industry sectors, with new research revealing falling confidence in digital capabilities and a shortage of the skills, leadership and collective vision needed to shape the digital future. The Capgemini Research Institute examined sentiment on digital and leadership capabilities among bank and insurance executives, comparing it to an equivalent study from 2012. Over 360 executives were surveyed from 213 companies, whose combined 2017 revenue represented approximately $1.67 trillion.
Esme Loans has enlisted Microsoft to build a new cloud based data warehouse, enabling faster and better targeted lending decisions and automated service assisted by artificial intelligence (AI). Microsoft has entered into partnership with the digital lender to build a bespoke data warehouse - a centralised data repository held on an online server - which will help improve the customer journey, simplify integration with third parties and provide a faster application process.
A government report has found that some of the UK’s leading companies are struggling to understand the potential impact of a cyberattack on their business, with less than a fifth (16 per cent) of boards having a full grasp of the threat. A joint survey of the cyber security threat landscape compiled by the National Cyber Security Centre (NCSC) and the Department for Culture, Media and Sport (DCMS) analysed the approach to cybersecurity among the UK’s FTSE 350 companies.
Cyber attacks on mobile banking apps rose by more than 100 per cent in the last six months of 2018, according to a new report from ThreatMetrix. An analysis of 17 billion digital transactions processed through the ThreatMetrix Digital Identity Network during the second half of 2018, found that 61 per cent of all digital transactions now originate from a mobile device.
Innovate Finance, the independent industry body for UK FinTech, has launched the FinTech for Schools Initiative, with the aim of inspiring young people’s ambitions for innovation in financial services. The campaign is designed to encourage young people to understand the increasing importance of digital skills in the workplace, with an emphasis on ensuring the sector is appealing to girls.
Almost 70 per cent of customers would be more comfortable using an Open Banking app provided by a traditional High Street bank over the same consolidated banking app provided by a challenger bank, a new study has found.A survey of 2,000 UK banking customers commissioned by software analytics firm New Relic found that a majority would trust incumbent banks to combine their account information from multiple bank accounts in one mobile app, with 69 per cent saying they would be more willing to use consolidated banking services from traditional banks, compared to just 19 per cent who said they would prefer to use a challenger.
Barclaycard has signed a new card acceptance partnership with UnionPay International, a subsidiary of China UnionPay. The deal will enable its 110,000 UK merchants to accept UnionPay through a phased roll-out that will begin this summer.
Consumer finance FinTech Quint Group has secured a £16.5 million in a financing deal from NatWest. Founded in 2009, the UK-based startup now has operations in the US, Australia, Poland, China and South Africa.
UK banks are being hit by at least one major IT or security failure that disrupts customer payments on a daily basis, according to an investigation by Which? Money. The consumer watchdog also found that the UK’s six largest lenders suffered at least one IT outage or security error every two weeks, with a total of 302 incidents that prevented customers from making payments in between March and December 2018.
The rapid pace of change in FinTech is leading to heightened fears among regulators of harm to consumers and risks to the wider financial system, according to KPMG. The auditing firm’s research into the steps being taken to ensure FinTech firms are safely implementing technology found that regulators and risk experts are finding it difficult to keep up with the pace of technological development.
The operational cost savings from using chatbots in banking will reach $7.3 billion globally by 2023, up from an estimated $209 million in 2019. According to the latest analysis from Juniper Research, this represents time saved for banks in 2023 of 862 million hours, equivalent to nearly half a million working years.
NatWest has become the latest High Street bank to launch service which allows customers to see all their bank accounts in a mobile app. The service enables customers to view current accounts from 15 different UK banks, with account information, balances and transactions available.
The Co-operative Bank has returned to operating profit for the first time since 2013, despite IT upgrades and PPI payouts resulting in an overall loss before tax. A statement of full year profits for 2018 showed group losses before tax were £140.7 million, up slightly from £140.3 million in 2017. However, operating costs were down by 13 per cent to £374 million.
The Payment Systems Regulator (PSR) has welcomed a new voluntary industry code of good practice to protect people from Authorised Push Payment (APP) scams which will take effect from 28 May. At the beginning of 2018, the PSR set up a dedicated steering group, made up of consumer representatives and the industry, to design and implement a code that would work for everyone.
Revolut has denied media reports that the departure of its chief financial officer earlier this year was linked to questions around business practices at the challenger bank. According to a report in the Daily Telegraph last night, Peter O’Higgins resignation from the FinTech challenger in January coincided with the emergence of reports that Revolut’s board has launched an internal investigation in 2018 over an alleged failing in its screening system.
London continues to top the tables for investment in FinTech companies, with the capital having the highest number of tech ‘unicorns’ in Europe. Data comped by technology and investment advisory firm GP Bullhound for London & Partners found that London’s tech companies attracted £1.8 billion in venture capital (VC) funding, more than any other European City.
Mastercard has signed a global Memorandum of Understanding (MoU) with Angaza which will see the two companies partner to roll-out a digital payment solution that increases access to affordable necessities - like solar home systems and water pumps - for people and businesses in emerging markets across the globe. Leveraging Angaza's pay-as-you-go (PAYG) embedded metering and monitoring technology and Mastercard's digital payment infrastructure, including QR technology, this partnership will not only unlock access to the basic necessities, but will also help people without access to credit or traditional banking services start on a path to financial inclusion.
Research from SAS and the Global Association of Risk Professionals (GARP) has revealed that 81 per cent of risk professionals in the financial services industry have already seen benefits from artificial intelligence (AI) based technology. In December, SAS and GARP surveyed more than 2,000 representatives from across the financial services industry - including banking, investment banking and asset management - specifically targeted at those with a risk-related role.
Credit rating giant Experian has abandoned its £275 million merger with rival firm ClearScore after regulators warned a deal between the sector’s two largest players could damage competition. Experian has backed down after the Competition and Markets Authority (CMA), released the provisional findings of a phase 2 investigation into the takeover in November citing concerns that it was likely to “weaken competition in the sector and have a negative effect on the services offered to customers.”
Nearly 60 per cent of wealth managers report that their clients are increasingly worried about the risk of data breaches and cybercrime as the asset management industry begins to adopt new technology, according to a report from GlobalData. However, despite growing cyber security fears amongst clients, a report compiled by the data analytics firm based on interviews with wealth managers found that just 43 per cent of professionals were concerned about the effect of potential data breaches on their company’s brand.
Nivaura has closed a strategic funding round, raising $20 million in seed and seed extension capital, led by London Stock Exchange Group. The FinTech firm, founded three years ago, is focused on the deployment of digital investment banking platforms for banks, exchanges and other financial institutions, to connect and automate fragmented and manual processes involved in the issuance and administration of instruments such as debt, equity and structured products.
Citi’s Treasury and Trade Solutions has launched and new digital onboarding experience for institutional clients. CitiDirect BE is now available in North America and across six countries in Western Europe, with a full roll-out across the rest of EMEA, Asia Pacific and Latin America in the coming quarters.
M&S Bank has become one of the first mortgage providers to enable Open Banking-assisted mortgage applications. This means most customers will no longer need to source and supply copies of bank statements to support their mortgage application, as this documentation will be immediately and securely provided via the new platform.
New technology is changing the nature of research for fund managers post MiFID II, according to the Financial Conduct Authority’s (FCA) chief executive. Addressing the European Independent Research providers association yesterday, Andrew Bailey stated: “New technology is changing not only the nature of research, but how this is supplied, monitored and valued by the buyside.”
Sixty three InsurTech deals with a total value of $1.59 billion were announced worldwide in the fourth quarter of last year, up 24 per cent on the previous quarter and 155 per cent year-on-year. The total, including all-stage investments in property, casualty, life and health ventures, is the second highest ever, just behind the exceptional second quarter of 2015, according to from advisory firm Willis Towers Watson.
Cloud management provider Sage has partnered with UK payments FinTech Modulr to simplify the task of managing accounts payable and payroll payments. The solution, known as Sage Salary and Supplier Payments, will allow businesses and their accountants to securely manage and process payments from directly within the Sage Accounts and Payroll products.
Mobile payments represented more than 27 per cent of the total social media conversation around payments, with total mentions increasing 20 per cent over the prior year. This is according to the 2019 edition of the Mastercard Digital Payments Study, which analysed more than 3.3 million conversations from the past year across several social media channels, including Twitter, Facebook, Instagram and Weibo.
The board of Banking Competition Remedies (BCR) has announced that the Incentivised Switching Scheme is now accessible to target customers. This follows BCR’s announcement in December of the 11 organisations so far eligible to participate – including: Arbuthnot Latham, Clydesdale Bank, The Co-operative Bank, Hampden & Co, Metro Bank, Santander UK, Starling Bank, Handelsbanken and TSB Bank.
Digital banking FinTech OakNorth is partnering with payments clearing platform ClearBank, enabling the former to offer instant payments and agency banking services. ClearBank will initially provide real-time Faster Payments infrastructure to OakNorth.
Nomura is investing in artificial intelligence (AI) startup venture AIM2, which is aimed at using robotics and machine learning to build automated trading tools for financial markets.The Japanese investment banking group said the venture, established by hedge fund Brevan Howard in 2015, was focussed on using AI and data science to analyse large sets of high-frequency historical and real-time data, including client flows and market data.
Goldman Sachs has reportedly joined forces with Apple to issue a new credit card that will help customers to manage their money. A report in the Wall Street Journal suggested that the joint card will link to the Apple Wallet mobile app, letting customers budget, track reward schemes and have a better oversight of their finances.
The board of Banking Competition Remedies (BCR) has announced the results of the Capability and Innovation Fund Pool A grant process, with Metro Bank, Starling Bank and ClearBank sharing the £280 million pot. Metro Bank has been awarded £120 million, with £100 million for Starling and £60 million for ClearBank.
A new survey from Marqueta has revealed that 41 per cent of UK consumers are considering a switch to digital-only banking, with Millennials leading the way. A Propeller survey of 2,027 banking customers across the UK, US, France, Germany and Spain, commissioned by the payment infrastructure platform, found a general belief that cash as form of currency is set to become obsolete within the next two decades.
The majority of Americans (88 per cent) want technology to complement, not replace, the assistance of a human financial advisor. This is according to a survey of 2,000 US adults commissioned by MDRT and conducted online by The Harris Poll. It also found that only five per cent think financial planning should be managed entirely by technology-based tools.
Revolut’s chief executive has called on the UK government to create specialised visas for technology professionals, as the London-based digital challenger bank announces plans to double its workforce in the UK over the next few months. “Right now, there is no doubt in my mind that London is the best place to build and grow a FinTech startup,” stated Nik Storonsky. “However, there is a serious lack of homegrown technical talent here, which is why around seventy per cent of our software engineers and data scientists are recruited from abroad.”
Despite investment industry excitement around FinTech solutions, just 15 per cent of people in the UK use mobile apps for making investments, while 19 per cent use them to view long-term investments. This is according to ING’s latest international savings survey, which took in 14,695 respondents in 15 countries, including 1,041 in the UK.
Two fifths (40 per cent) of UK businesses consider the risk of cyberattack as their major concern around the adoption of 5G, according to a new report from EY. A survey of 200 UK enterprises’ preparedness for high-speed 5G networks and Internet of Things (IoT) technology by the auditing firm, found that while UK businesses are increasing spending on the technology, there is still uncertainty surrounding the maturity of services.
InsurTech startup VouchForMe has launched in the UK, aiming to disrupt and revolutionise the industry. The blockchain-powered peer-to-peer model is based on social proof endorsements to reduce costs and lower premiums for policyholders.
Payments platform Adyen has launched a new payment service powered by Open Banking. The service is an alternative to card payments and takes advantage of the European Union’s second Payment Service Directive (PSD2) requirement for banks to create Application Programming Interfaces (APIs) for approved third parties to initiate payments on behalf of consumers.
Seven in ten (70 per cent) of all business leaders and finance professionals believe that errors in financial data are leading to significant accounting errors, according to a new report.A survey of more than 1,100 executives commissioned by automated financial software firm Blackline also found that more than half (55 per cent) were not completely confident their firm was capable of catching data-led financial errors before reporting results.
One in five (21 per cent) businesses in the UK believe that decision makers do not place enough value on technology, with a quarter (24 per cent) unsure of how FinTechs could help them, according to research by Centtrip. The intelligent treasury management, payments and foreign exchange firm interviewed more than 500 decision makers from UK medium-sized and large companies about their current use of automation.
According to KPMG’s latest Pulse of Fintech Report, UK InsurTechs saw over $1 billion of investment activity through 2018, up from $792 million in 2017. This performance bucked the global trend, as despite 13 InsurTech deals worth more than $100 million taking place globally, overall investment levels declined year-on-year by almost half, standing at $5.7 billion for 2018.
The German government has launched a consultation into the potential of blockchain technology. Sources told Reuters that staff and industry groups working with startups developing blockchain and distributed ledger technology (DLT) solutions have been invited to submit recommendations from this week onwards.
Banking software-as-as-service provider Mambu has raised €30 million in a funding round led by US-based Bessemer Venture Partners, with participation also coming from existing investors Acton Capital, CommerzVentures, Point Nine Capital and Runa Capital. Mambu, which launched in 2011, has experienced triple-digit growth for four consecutive years as an increasing number of challenger and established banks sign on to implement the platform.
Small business lending platform iwoca has raised £150 million in equity and debt capital, bringing its total funding to £350 million.The Series D round was led by Augmentum Fintech, along with NIBC Bank and existing investors, including Prime Ventures.
First Direct have topped a poll of the best online and mobile banking services, closely followed by Barclays and Metro Bank. The Competition and Markets Authority surveyed approximately 1,000 customers across the UK for each of the 16 largest current account providers, with 16,023 people surveyed in total.
Researchers at IT security firm ESET have warned of the emerging threat of fake banking apps. Research on the malware landscape for Android operating systems found that that cyber criminals have developed mobile banking malware that impersonates legitimate finance apps to obtain victims’ credentials, before stealing money from their bank accounts.
Banks should fear competition from BigTech firms branching out into financial services more than the threat of FinTech challengers, according to the Financial Stability Board (FSB). A report from the international policy body for financial services tasked with assessing the impact of new technology on global financial stability, said the disruption that could stem from the entry of global tech giants could “materially alter the universe of financial services providers”.
Barclaycard Commercial Payments has announced a strategic partnership with SAP UK, which will see Barclaycard integrate its business-to-business (B2B) payment product, Precisionpay, into SAP’s Ariba solutions marketplace. The integration, to become available later this year, will bring procurement and payment together in one place. The first Barclaycard product to launch within Ariba Network will be Precisionpay Bank Transfer.
Regulatory sandboxes are “neither necessary nor sufficient” to promote financial inclusion, and similar results can be achieved through innovation offices and other tools, according to the United Nations Secretary-General’s Special Advocate for Inclusive Finance for Development (UNSGSA). However, the new report also emphasises the potential for FinTech to accelerate a dramatic rise in financial inclusion for the 1.7 billion people worldwide who do not have a bank account.
J.P. Morgan has become the first US bank to create and test a digital coin representing a fiat currency. The JPM Coin is based on blockchain technology, enabling the instantaneous transfer of payments between institutional accounts. Umar Farooq, the bank’s head of digital treasury services and blockchain, explained that JPM Coin is a digital coin representing US Dollars held in designated accounts at JPMorgan Chase, so when one client sends money to another over the blockchain, JPM Coins are transferred and instantaneously redeemed for the equivalent amount, reducing the typical settlement time.
Ant Financial, the financial arm of Chinese corporation Alibaba, has confirmed it is going ahead with the acquisition of London-based currency exchange firm WorldFirst. A spokesperson for Ant Financial said the deal would allow both companies to “better serve small businesses and promote financial inclusion around the world”. There has been no confirmation of the value of the deal, but previous reports suggested it could be in the region of $500 million.
Zopa, the peer-to-peer lending company, has appointed a former Virgin chief executive to the role of chairman, as it prepares to launch a new banking service in the UK. Gordon McCallum, a former chief executive of Virgin’s UK management company, will take over as non-executive chairman from Giles Andrews, who co-founded Zopa.
Rapyd has announced a $40 million Series B financing round led by General Catalyst and Stripe, with participation from Target Global and IGNIA. With this investment, the UK-based payments FinTech will expand its technology platform that supports any local or cross-border commerce use case requiring local payments, such as bank transfers, e-wallets and cash for local acceptance and payouts.
Open Banking is set to becoming a “global phenomenon”, according to Yolt’s chief business officer, who announced the FinTech was launching its first API-management service to businesses across Europe. In an interview with FStech to mark the launch of Yolt for Business, Leon Muis said the product was now ready to be white-labelled and rolled out across European markets, following six months of beta testing.
IBM Watson has powered new artificial intelligence-driven assistants for two of the UK’s largest financial services firms. Nationwide Building Society announced the launch of Arti, a Watson Assistant virtual agent which will work side-by-side the building society’s employees when dealing with customers.
The Cambridge Centre for Alternative Finance (CCAF) has launched its first survey of regulatory technology (RegTech) and supervisory technology (SupTech) firms, in partnership with EY Japan. Fieldwork is now underway for the survey, whose primary aim is to create an evidence-based taxonomy of RegTech firms, then produce benchmarking data against this. CCAF researchers will also publish a report in the first half of 2019, assessing the outlook for the sector.
First Direct has announced plans to expand its partnership with Open Baking FinTech Bud to enable customers to access third party financial services through its mobile banking app. The online and telephone bank first partnered with Bud in 2017 to explore the use of Open Banking services via its Application Programming Interface (API) technology and launch pilot testing of the experimental mobile banking app, called artha.
Starling Bank has raised £60 million in a Series C funding round led by Merian Global Investors, and a further £15 million from an existing seed investor Harald McPike, bringing the total to £75 million. The funding will support increased investment in its retail and small to medium-sized enterprise (SME) banking products in the UK. It will also enable the digital banking platform to accelerate global expansion, starting in Europe.
Mastercard has teamed up with San Francisco-based FinTech Token.io to expand its Open Banking connectivity to European banks. The card payment services giant will use Token’s open Application Programming Interfaces (APIs) and operating system to connect merchants, retailers and other regulated third parties to financial institutions in Europe, for payments transactions and data flows.
Venture capital and private equity investment in the UK FinTech sector rose to a record $3.3 billion in 2018, up 18 per cent year-on-year, according to a report from Innovate Finance. The industry body’s sector analysis revealed that growth private equity investment rose 57 per cent to $1.6 billion, while venture capital dipped to $1.7 billion.
Which? has called on the government to appoint a regulator to protect access to cash, as a combination of bank branch and cashpoint closures risks leaving people struggling to pay for essential goods and services. Despite the increased popularity of digital and card payments, having access to cash is still a necessity for more than 25 million people across the country.
SWIFT is set to open its Know Your Customer platform, The KYC Registry, to corporates. In a first step, from the fourth quarter of 2019, all 2,000 SWIFT-connected corporate groups will be able to join The KYC Registry, and use it to upload, maintain and share their KYC information with their banks.
More than 40 per cent of banking customers expect to be able to access so-called ‘instant banking’ services as digital banking challengers drive changing consumer expectations. A Censuswide survey of 2,005 consumers for digital banking firm Five Degrees showed that consumer satisfaction with account set up and onboarding was declining among traditional banking customers, with just 37 per cent reporting that their bank offers instant set up.
More than three quarters of banking incumbents (80 per cent) identify digital challengers as a threat to their business, with almost one third (30 per cent) expecting them be the most disruptive force in the industry in the coming year, according to a new study.The survey of banking professionals, commissioned by payments software and card firm Fraedom, also found that other trends sets to disrupt the traditional banking landscape over the next 12 months are digitalisation (36 per cent) and the consumerisation of technology (36 per cent) as banking apps begin to integrate with new technologies such as wearables.
Jumio, an artificial intelligence (AI) driven digital identity startup is launching a video selfie-enabled authentication tool for banks and other businesses. Jumio Authentication allows customers to record a video of themselves to prove they are the account holder and verify high-risk transactions, restore forgotten passwords and unlock rental cars, in a secure method that replaces manual passwords and guards against online fraud.
A panel of experts at the London Blockchain Week conference took aim at regulation yesterday, with one calling the authorities’ understanding of the emerging technology ‘lamentable’. Jonny Fry, chief executive of sector advisory firm Team Blockchain, noted that at industry events he’s attended in other countries, delegates have told him how lucky he is to be regulated by the Financial Conduct Authority (FCA) – “a regulator that actually listens to industry”.
Lloyds Bank has said customers are now able to access their online banking after hundreds reported problems accessing the service throughout the day.The UK’s largest lender said some of its 60 million customers had faced “intermittent issues” trying to log onto their accounts online, with the problems beginning at around 11am. Mobile banking apps were unaffected by the glitch.
Challenger bank Monzo has opened the waiting list for its first business account, designed for small and medium-sized enterprises (SMEs) and sole traders.It will be made available to the first 100 applicants as part of beta testing of its features, with roll-out of the full service envisaged by the end of 2019.
Digital insurance platform CoverHound has raised a $58 million Series D funding round, led by specialist insurer Hiscox, with additional investors including insurers Chubb, Aflac Ventures and Japan-based MS&AD. The latest investment brings the total capital raised since its launch in early 2010 to over $112 million.
Just 51 per cent of UK businesses leaders believe their organisation is well-placed to combat a cyber attack on their systems, while 13 per cent admit that their strategy is poor. A Consumer Intelligence survey of 555 senior executives and managers, commissioned by commercial insurance governance firm Mactavish, also found that 43 per cent said their firm had suffered at least one cyber attack in the last two years, while 30 per cent worried their cyber security strategy was average compared to the best protected businesses.
OakNorth has secured a $440 million investment from the SoftBank Vision Fund and the Clermont Group. This round takes OakNorth’s total primary and secondary funding to over $1 billion, more than any other FinTech in Europe, according to the company. This financing will be used to launch its lending operations in the US, providing North American lenders with the capability to expand business lending opportunities and accelerate their business lending.
Visa has ramped up its bidding war with Mastercard by offering around £247 million to takeover payment company Earthport. The move to outbid its payments rival for the company comes after Mastercard’s subsidiary Bidco dramatically stepped in to gazump Visa’s bid with a £233 million cash offer late last month, prompting Earthport’s directors to call off a shareholder meeting scheduled to discuss Visa’s offer.
The European Central Bank (ECB) is weighing up the prospect of linking national card schemes to instant payment rails, effectively mounting a challenge to the dominance of Visa and Mastercard in the payments market. In a speech to the American European Community Association in Brussels yesterday, Yves Mersch, an ECB board member, outlined the idea for a single Euro payment area (SEPA) arrangement for cards, which has been mooted as a way of injecting competition into a payments market where the so-called ‘Visa/Mastercard duopoly’ conducts more than 80 per cent of all EU card transactions.
Robotic process automation (RPA) firm Blue Prism has integrated with Oracle to help automate the reporting of financial crimes and compliance processes in financial institutions.
The Merseyside-based business announced the tie up with Oracle's Financial Services Global Business Unit to build solutions that enable organisations to investigate and report financial crimes and suspicious activities.
Financial services firms are looking to emerging technologies at a higher rate than organisations in other sectors, with artificial intelligence (36 per cent) and blockchain (24 per cent) are highlighted as the industry’s top priorities. A survey commissioned by Canonical and carried out by 451 Research - with a sample size ranging from 750 to 1,100 across EMEA and North America - found that adopting emerging technologies often leads to increased complexity of IT environments.
Tink has announced an investment round of €56 million, led by Insight Venture Partners. The Swedish personal financial management startup plans to use the funding to push its platform into more European markets via the second Payment Services Directive (PSD2) or Open Banking changes.
Lloyds Banking Group has launched an Open Banking feature allowing customers to sync their financial data from current accounts at different banks within their mobile banking app. The functionality, available to users of the Lloyds Bank and Halifax apps, will present all of their current account balances and transactions in real-time with a single login.
European savings marketplace Raisin has closed a $114 million Series D funding round, with plans to spend it on strategic acquisitions and further international expansion. Existing investors Index Ventures, PayPal, Ribbit Capital and Thrive Ventures all participated in the round, which brought the total raised by the German startup to $200 million since launch in 2012.
The Labour Party has called for a state regulator to fix the “distorted” and dystopian digital market dominated by social media and tech giants which it says are at risk of subverting democracy and causing serious social harm. In a speech in London today, Labour’s deputy leader Tom Watson - who is also shadow secretary of state for digital culture, media and sport - will set out his party’s proposals for a new statutory regulator with powers to prevent market abuse and break up “monopolistic” technology companies which have a stranglehold over the content viewed by billions online.
Two thirds of company leadership bypass their own IT departments when buying new technologies for digital transformation, according to a new survey from the Economist Intelligence Unit (EIU). A study of 303 senior executives from private and public sector organisations across North America, Europe, Asia-Pacific and Latin America, produced by the EIU for software firm BMC, also found that despite the sidestepping of IT departments for purchasing decisions, 43 per cent would still hold them accountable if digital transformation initiatives were to go wrong.
Revolut is partnering with WeWork to offer business customers three month of free hotdesking space, pointing towards the growth of lifestyle services as part of the FinTech’s product offering. Announcing the tie up, Revolut said it had signed over 80,000 businesses to its account services since its launch in June 2017 and that it was planning to launch an end-to-end acquiring solution for businesses in 2019.
Facebook has hired a team of blockchain experts from London startup Chainspace, prompting renewed speculation that the social media giant is drawing up plans for a blockchain-based payments technology. According to the news site Cheddar, the so-called ‘acqui-hire’ of four of the five founding members of Chainspace is the next stage in the development of Facebook’s blockchain unit, led by former PayPal president David Marcus.
FinTech firm Anna has raised £8.5 million from Kinetik to further develop its financial admin app and business account for small businesses. Anna, which stands for ‘absolutely no nonsense admin’, claims to have built a user base of 3,500 customers since launching the app in September last year. It combines a current account, debit card and digital assistant that helps with things like sending and chasing invoices.
FinTech and blockchain startups led the field in attracting investment in 2018, according to a survey which also showed that the overall amount of equity poured into the UK’s startups slowed by 19 per cent last year to £7 billion. A report on equity investment conducted by Beauhurst, a data provider, found that overall investment in startups and small and medium-sized enterprises (SMEs) was down to £7 billion from £8.6 billion in 2017, while the total number of deals dropped to 1,572 from 1,744 in 2017. The average size of investment also fell by 15 per cent across the boards.
A new collaborative project that will support startups and small to medium-sized enterprises (SMEs) in using blockchain technologies has been awarded €5 million funding from the European Union. Blockstart unites the University of Surrey with SETsquared Surrey, and partners across Europe, to drive small business innovation in the areas of health, logistics and agrifood.
Payments technology firm SafeCharge has launched Identity Manager, an automated digital identity validation solution. With identity verification being one of the thorniest challenges for modern online businesses, the product aims to streamline complex background checks in a fast and cost-effective manner.
The Isle of Man has announced the formation of a Blockchain Office and the launch of an Isle of Man Sandbox. These initiatives form part of a new commitment from the self-governing British dependency to become an international hub for blockchain businesses. The island’s authorities stated that they will not regulate blockchain in isolation, giving businesses the flexibility to best use this emerging and transformative technology.
Over 59,000 data breach notifications have been reported across the European Economic Area by public and private organisations since the General Data Protection Regulation (GDPR) came into force last May 2018, according to DLA Piper. The Netherlands, Germany and the UK topped the table in the report, with approximately 15,400, 12,600, and 10,600 reported breaches respectively. The lowest numbers of reported breaches were made in Liechtenstein, Iceland and Cyprus, with just 15, 25 and 35 reported breaches respectively.
An overwhelming majority (90 per cent) of private equity firms believe that artificial intelligence (AI) is the technology most likely to disrupt their industry in the coming years.A study of private equity professionals’ attitudes to technology for client services firm Intertrust found that more than a third (37 per cent) of respondents thought new technologies such as AI and blockchain were already being adopted in the industry and would become more widespread in the next five years.
Curve, a FinTech targeting the Millennial generation, has launched a metal smart card which allows users to combine all their credit and debit cards on a single card.The London-based startup, which began offering its consolidated card and app service last year, said that its new Metal card will allow users to access spending abroad with zero currency conversion fees and a range of cashback and rewards at premium retailers, including Harrods and Selfridges.
Open Banking FinTech Bud has secured more than $20 million of Series A funding in a round co-led by major banks, including HSBC, Goldman Sachs and ANZ. The London-based startup uses Application Programming Interfaces (APIs) to combine a consumer’s financial data from a number of sources and artificial intelligence (AI)-driven automation to enable greater control over personal finances.
Banking customers are increasingly opening multiple accounts, particularly the younger generations, with up to a third of Millennials and Genration Zs having opened at least two new accounts in the past five years. This is according to Crealogix, which commissioned Censuswide in November to interview 2,000 18 to 65 year-olds who currently have a bank account.
TSB was able to put a price on last year’s botched IT migration, reporting pre-tax losses of 105.4 million for 2018. The bank recognised post-migration costs - including customer compensation, additional resources, fraud and foregone income - of £330 million, although this was partially offset by the provisional recovery of £153 million from IT provider Sabis.
Zurich Insurance Group has announced that Chisel AI is the gold winner in the first Zurich Innovation World Championship, for its work to improve processing of unstructured data sources using artificial intelligence technology. Zesty.ai was the silver winner, while LifeNome and Soldier.ly were named shared bronze winners.
Banking Competition Remedies (BCR), the independent body established to implement the £775 million Royal Bank of Scotland (RBS) Alternative Remedies Package, has opened the application window for Pool B of the Capability and Innovation Fund. The fund is designed to support the development of wider competition in the small and medium-sized enterprise (SME) banking markets. The fund comprises of four pools with a total value of £425 million. The process for Pool A and Pool D is currently underway.
Nearly three quarters (72 per cent) of consumers would be prepared to sync their personal finances on their mobile phones, according to Google. The survey of more than 500 mobile users, carried out by Google Consumer Surveys for Webpals Mobile, a customer acquisition company, also found that around a quarter of consumers of all age groups are principally using digital banking services through apps or websites.
Less than half of Britain’s leading High Street banks are offering customers two-factor authentication to secure their online accounts from hacking attempts, according to a Which? investigation. The consumer watchdog partnered with cyber security firm Sure Cloud to carry out an assessment of online security procedures at 12 leading retail banks. It found that only five have adopted a two-factor authentication (2FA) login, which requires a password and further information in order to gain access to a customer’s account.
Less than half (46 per cent) of small and medium-sized enterprises (SMEs) in the UK feel that they have the upper hand in applying the latest technology, according to American Express.A global study of senior executives at 3,000 SMEs conducted by Oxford Economics for American Express also found that more than two thirds (64 per cent) felt threatened by the burden of changes in the regulatory and political landscape, given rising uncertainty over Brexit.
The Global Financial Innovation Network (GFIN), a network of regulatory bodies building a FinTech ‘sandbox’, has begun calling for applications to use its regulatory testbed. Chaired by the UK’s Financial Conduct Authority (FCA), the initial pilot cross-border test follows a consultation paper published last August.
Autonomous vehicle InsurTech firm Avinew has announced $5 million in seed funding, with investment led by Crosscut and additional participation from American Family Ventures, Draper Frontier and RPM Ventures. Through Avinew’s proposed insurance solutions, consumers and fleets who own vehicles equipped with autonomous and semi-autonomous capabilities will have access to insurance that will reward them for using their vehicle’s safety features. Currently, selected vehicles from Tesla, Mercedes, Ford, GM, Nissan, Audi, Volvo and more will be eligible.
HooYu, a FinTech startup specialising in digital identity confirmation, has been enlisted by e-account provider Suits Me to improve access to banking services for temporary and migrant workers. Launched in 2016, Suits Me’s pre-paid debit card services aims to tackle the problem of financial exclusion for workers who lack the credentials to open traditional High Street Bank accounts for their wages and digital payments.
Substandard customer service is costing financial services firms business worth $10 billion a year, as more than one in three (36 per cent) financial institutions lose customers due to issues with onboarding. A study of 250 decision makers in commercial and financial services institutions by Fenergo, a client lifecycle management software provider, also found that capturing and improving data and documentation was proving a challenge across a range of industries, with 31 per cent ranking it as the most significant pain point.
CYBG has worked with Red Hat to expand and standardise its digital banking efforts. The owner of Clydesdale Bank, Yorkshire Bank, B and Virgin Money has united its digital operations on Red Hat’s OpenShift Container Platform to accelerate application development and deliver services to customers more quickly.
Santander has launched an Open Banking-enabled service which allows its customers in Spain to integrate their financial data with savings app Raisin. Under the tie-up, Santander will integrate its Application Programming Interface (API) with Raisin, enabling customers wishing to register for its digital savings app to tap the ‘Santander Connect’ button and securely share their name, date of birth, or contact details with Raisin.
Challenger banks are enticing increasing numbers of customers to switch to their current accounts, according to the latest figures from the Current Account Switch Service (CASS).Third quarter figures showed incumbent Nationwide recording the most gains, with 40,565 switches and 8,883 losses, followed by HSBC with 38,477 switches and losses of 22,047.
SWIFT has announced a proof of concept (PoC) to trial gpi Link, a gateway to interlink e-commerce and trading platforms, with cross-border payment infrastructure SWIFT gpi. The plans is to connect gpi members to multiple trade platforms, enabling payment initiation, end-to-end payment tracking, payer authentication and credit confirmation. The gateway will enable the continuous monitoring and control of payment flows and the subsequent movement of goods by those trade platforms.
Mimiro, an artificial intelligence (AI) anti-financial crime startup, has raised $30 million to fund the expansion of its machine learning platform aimed at tackling terrorist funding, money laundering and fraud. The Series B funding round for Mimiro - formerly known as ComplyAdvantage - was led by Index Ventures, a London and San Francisco-based venture capital firm, joined in the round by existing investor Balderton Capital.
FinTechs raised a record $39.57 billion from investors globally in 2018, up 120 per cent from the previous year, according to CB Insights. Funding was raised through 1,707 deals - up from 1,480 in 2017 - due in large part to 52 ‘mega-rounds’, or investments larger than $100 million, which were worth $24.88 billion combined.
A global ransomware attack affecting more than 600,000 businesses could inflict up to $193 billion of economic damage worldwide, according to a report which studied a hypothetical cyberattack as part of a risk management model. The report, compiled by a group of leading insurance and risk modelling institutions, including Lloyds of London, Aon and the University of Cambridge, tested the potential impact of a ransomware attack in which malware is sent to a business via an infected phishing email, which is opened by one employee and from there automatically forwarded to all contacts.
Revolut has unveiled plans to build a global licencing team responsible for securing banking, trading and credit licences in new and existing markets, starting with the United Kingdom and the United States. The new team will aim to deliver the entire end-to-end licensing process, from liaison with decision-makers, partners and regulators, through to the execution of specific deliverables required to obtain each licence. This will enable Revolut to move forward with the next phase of its global expansion plans.
Former Virgin Money boss Jayne-Anne Gadhia is reportedly looking to raise millions to fund a new FinTech startup called Snoop that would use Open Banking data to save customers money on their household bills. According to Sky News, Gadhia, who left Virgin Money after it was acquired by CYBG last year, is seeking investors for a £10 million initial raise to get the startup off the ground.
TrueLayer, a provider of Application Programming Interfaces (APIs), is launching a payments-specific API based on the second Payment Services Directive (PSD2). The Payments API, one of the first to be launched in Europe under PSD2 protocols, aims to integrate with client systems to enable seamless and near instantaneous online payments.
First Direct has launched fdpay, a new service letting customers make peer-to-peer payments within social media apps such as WhatsApp and Facebook Messenger. Technology from FinTech firm PayKey lets users tap a payment icon within a conversation and manage a payment without having to open the banking app or login.
Businesses in the UK have hit the pause button on more than £27 billion worth of IT, digital and technology projects as they wait on the outcome of Brexit, according to new research.A survey of 504 business leaders conducted by polling firm Opinium for internet service provider Beaming found that almost a third (31 per cent) of companies in the UK - equivalent to 1.7 million businesses nationwide - have put IT initiatives schedule for 2019 on hold due to Brexit uncertainty.
Featurespace has raised £25 million from a funding round led by venture US venture capital firms Insight Venture Partners and MissionOG. The round also included further funding from existing investors including IP Group, Highland Europe, TTV Capital, Robert Sansom and Invoke Capital.
Digital insurance broker Mylo has raised $28 million in a Series A funding round led by Guggenheim Partners. Guggenheim's long-term investment will help accelerate the startup’s current business strategy, according to a statement. David Embry, Mylo’s chief executive, commented: "Guggenheim's investment will allow us to take Mylo to the next level through new strategic partnerships and innovative product and service offerings that help us reach more customers and offer smarter coverage.”
Mastercard has moved to gazump Visa’s takeover bid for payments business Earthport with a £233 million cash offer. The offer, which comes after Visa made a £198 million bid for Earthport last month, pits two of the world’s payment processing giants in a bidding war. Visa has yet to respond publicly.
Big data is set to shake up the financial services industry, according to a new survey which found that nearly half (45 per cent) of finance professionals regard it as the most influential trend. Onguard, an order-to-cash solutions provider, surveyed 1,004 chief financial officers (CFOs) and staff in related roles, finding that 30 per cent anticipate that analysis of big data - the use of large data sets to suggests trends and patterns in behaviour - will need to become part of their skillset in the near future.
The Treasury Select Committee has launched a new inquiry into the future of the UK’s financial services once the UK has left the EU. The committee will examine what the government’s financial services priorities should be when it negotiates the UK’s future trading relationship with the EU and third countries.
Just over 20 per cent of fines issued by the Information Commissioner’s Office (ICO) between 2015 and 2018 involved insecure payment card data or financial information, according to analysis carried out by Cyberfort Group on all non-marketing related fines. Almost a third of these breaches were down to organisations neglecting simple security procedures, whilst over three quarters were caused by issues at the application layer, often related to out-of-date software, insecure third-party payment systems, or inadequate scanning.
Augmentum Fintech has invested £7.5 million in small business lender iwoca. The venture capital firm, which specialises in backing FinTech challengers, said it was investing in iwoca to help fund the startup’s expansion beyond its core markets of the UK, Germany and Poland.
A quarter of institutional investors believe major listed companies will have to start proactively reporting on their plans and ambitions around blockchain due to investor demand. The Global Blockchain Business Council (GBBC) surveyed 71 institutional investors from around the world over the last two months, finding that 38 per cent anticipate businesses will have to start reporting between three and five years from now, while only 13 per cent think companies will never have to do this.
The Payment Systems Regulator (PSR) has published its final terms of reference for a market review into the supply of card-acquiring services. The review follows concerns that the market may not be working well for merchants and therefore consumers. The regulator published draft terms for this market review in July 2018, with the final terms of reference taking into account feedback the received during the consultation period, which ended in September.
Experian is leveraging Open Banking to give gaming websites better oversight of their users gambling affordability. A total of £5.4 billion was gambled remotely, mostly online, in the UK in the year to March 2018, according to the Gambling Commission. Until now, gaming organisations have been unable to take in to account what people can afford to stake.
Hong Kong FinTech Actelligent is to set up shop in Edinburgh as part of a new inward investment project.In further evidence of the growing popularity of the Scottish capital as a destination for technology firms, Scottish Development International (SDI) said that Actelligent’s arrival marks a milestone for its efforts to encourage Hong Kong-based firms to relocate to the city.
Leadership teams in financial services organisations “do not appreciate the potential impact of technology disruption” according to more than half (52 per cent) of decision-makers surveyed by Vuealta. Research conducted through Censuswide among 500 senior financial services staff across the US and UK - 250 in each - found that cyber security (42 per cent) was the biggest challenge in the next five years. This was followed by political changes (39 per cent), regulation and compliance (36 per cent), data management and privacy (31 per cent) and uncertainty in the market (20 per cent).
IBM has posted its first annual revenue growth since 2011, as the company’s cloud, software and services growth strategy begins to bear fruit. Shares in the US technology services giant rose seven per cent after its fourth quarter earnings estimates were announced, stating it was on track to post above expectations full-year profits.
Companies that operate free-to-use cash machines in rural communities are to receive a cash injection to help slow the decline of ATMs as online banking takes hold. Under the funding plan run by LINK, the UK’s main cash machine network, businesses offering free ATM services at eligible machines will received a “super premium” of up to £2.75 every time a customer withdraws cash.
Santander has announced plans to close 140 branches in response to more and more customers using online services. The number of transactions carried out via Santander branches has fallen by 23 per cent over the past three years, while transactions via digital channels have grown by 99 per cent over the same period.
Business lending platform Growth Street has raised £7.5 million in a scale-up investment round led by the Merian Chrysalis Investment Company. Merian joins individual investors including Rob Rankin, former co-head of corporate banking and securities at Deutsche Bank, and Peter Brodnicki, chief executive of the Mortgage Advice Bureau.
The Financial Conduct Authority (FCA) is consulting on guidance which will set out the cryptoasset activities it regulates. This is aimed at helping firms understand whether their cryptoasset activities fall under FCA regulation and whether they need to be authorised and have appropriate consumer safeguards in place.
Goldman Sachs has invested in digital wealth manager Nutmeg, as part of a £45 million funding round. The investment round also featured existing investor Hong Kong-based financial adviser Convoy, which increased its stake in the Nutmeg in advance of planned expansion into international markets, including Asia, in 2019.
Automated payments hit a record high in 2018, with 6.4 billion transactions processed at a total value of £5 million, according to Pay.UK.The retail payments authority, which is in charge of Bacs Payment Schemes and Faster Payments, stated that in August 2018 alone 580 million payments were processed, surpassing the previous high of 573 million set in December 2015.
French insurance group AXA’s venture capital arm AXA Venture Partners (AVP) has raised $150 million for a second iteration of its FinTech-focused Early Stage Fund. The first Early Stage Fund, a $110 million vehicle raised 2015, has now been fully deployed, with AVP stating that the second launch confirms its ambition and commitment to early stage venture investing.
The European Commission (EC) has fined Mastercard €570 million for limiting the possibility for merchants to benefit from better conditions offered by banks established elsewhere in the Single Market, in breach of EU antitrust rules. Mastercard is the second largest card scheme in the European Economic Area (EEA) in terms of consumer card issuing and value of transactions.
EU-wide regulations, including the second payments services directive (PSD2) and General Data Protection Regulation (GDPR) are reshaping the way European Banks run their operations and communicate with their customers, according to the Economist Intelligence Unit.Its survey of 400 banking executives carried out for banking software firm Temenos found that PSD2, the precursor to Open Banking, and GDPR, which governs data protection, have driven 56 per cent of European lenders to respond to changing customer behaviour and demands.
Zurich has partnered with London-based travel startup Pluto to offer “travel insurance for people who don’t like insurance”. The insurance giant will provide underwriting expertise and claims management capacity to the new mobile-focused offering which aims to give Millennials a quote in around a minute, or around three minutes when a customer builds their own policy.
ING Bank has signed a five-year deal with enterprise software firm R3, entitling the bank to an unlimited number of licenses for R3’s commercial blockchain platform, Corda Enterprise. The deal will allow ING to roll out access to Corda Enterprise throughout the bank globally and deploy production-ready CorDapps across a range of business areas. CorDapps cover a wide variety of financial services activity including trade finance, identity, insurance and capital markets.
Technology has cut the time required for the due diligence process for 64 per cent of merger and acquisition (M&A) practitioners. Due diligence now takes less than three months - from sourcing to deal completion - for a single successful transaction, according to a survey of 539 M&A professionals from Europe, Africa and the Middle East (EMEA) by Merrill Corporation.
The real world applications of Open Banking are beginning to unfold and should be “commonplace” by the end of 2019, according to the regulatory initiative’s policy chief. In a blog post reflecting on the progress made in developing and integrating Open Banking applications throughout the course of 2018, Alan Ainsworth, head of policy at the Open Banking Implementation Entity (OBIE), explained that he expects uptake of the financial data sharing protocol to grow rapidly once the third version of the Open Banking infrastructure is rolled out by the spring of 2019.
The Dutch authorities have called for a national licensing regime for crypto exchange platforms and crypto wallet providers to ensure more effective prevention of money laundering and terrorist financing. A joint statement from De Nederlandsche Bank (DNB) and the Authority for the Financial Markets (AFM) said that the European regulatory framework for corporate funding must be amended to enable blockchain-based development of small-scale corporate funding.
Smart card wallet producer Tangem has raised $15 million from SBI Crypto Investment for a new breakthrough in mass adoption of blockchain technology. The Swiss startup plans to use the investment to accelerate deployment of its ‘smart banknote’ technology in other industries where the secure storage and circulation of blockchain assets have the highest potential.
Startup lender MarketInvoice has raised £26 million in a Series-B funding round led by Barclays and Santander InnoVentures, with significant participation from European venture fund and existing investor Northzone. Technology fund Viola Credit, which also participated in the equity round, will provide a debt facility of up to £30 million to help scale the MarketInvoice business loans solution that sits alongside its core invoice finance solutions.