The prospect of a Brexit-driven election and Labour coming into power could impeded the progress made by the UK FinTech sector under the current Conservative government. This is according to Ian Anderson, executive chairman at the Cicero Group, chairman of the FinTech Strategy Group and non-executive director at Innovate Finance, who was speaking at the China/UK FinTech Bridge conference today.
An overwhelming majority (80 per cent) of wealth managers are concerned that their firm’s technology not good enough to keep up with the demands of the next generation of investors, according to a new report. A survey of 47 UK investment businesses, and 1,019 investors, by digital financial platform provider InvestCloud, found that 68 per cent of wealth managers said they knew that improvements to their digital technology would be necessary for survival.
The Co-operative Bank is to submit a bid for a share of the £775 million Royal Bank of Scotland Alternative Remedies Fund, targeted at driving competition amongst challenger banks to improve SME lending. The High Street lender is to apply for a share of the package, founded as part of the government’s agreement to bailout the bank during the 2009 financial crisis and the failed divestment of RBS’ Williams & Glyn business. One of the conditions imposed was to reduce its share of the SME banking market, with a view to bringing more challengers and FinTechs into the sector.
Pay.UK’s Faster Payments team has launched the anti-fraud Mule Insights Tactical Solution (MITS), following a successful pilot by participants of the UK’s real-time payment service. The technology, developed by Vocalink, a Mastercard company, enables suspicious payments to be tracked as they move between bank and building society accounts, regardless of whether the payment amount is split between multiple accounts, or those accounts belong to the same or different financial institutions.
Tide has secured one per cent of the UK small to medium-sized enterprise (SME) banking market, two years since it first started operations. According to figures from the Federation of Small Businesses, by the end of 2018, 56,000 of a total of 5.6 million UK SMEs will have chosen Tide as their preferred banking partner, more than doubling its members in the last 12 months.
Three quarters (73 per cent) of senior financial services industry decision-makers predict a big jump in demand for board-level chief technology officers (CTOs) in the sector over the next five years, as the challenge to find senior talent to leverage disruptive technology increases. Administrative services provider Intertrust surveyed over 500 executives covering the asset management, corporate, capital markets and private wealth sectors, finding that 40 per cent believe that by 2023 most firms in their sector will have hired CTOs with a mandate to drive strategic change, particularly by harnessing artificial intelligence (AI), blockchain and robotics.
Squirro has launched a new suite of applications aimed at transforming elements of insurance, from underwriting and submission-handling, to improved lead generation and deeper customer insight. Squirro for Insurance contains three apps - Squirro Commercial Insurance, Squirro Reinsurance and Squirro Commercial Underwriting - which use its Augmented Intelligence platform to leverage siloed structured and unstructured data to improve the submission handling as well as the underwriting process.
The Bank of England (BoE) has turned to automated technology in order to keep up with the growing threat of cyber attacks from rogue states, its heads of technology and infrastructure have told FStech. In an exclusive interview, Neal Semikin, head of technology infrastructure and security, and David Ferguson, a technology management principal, highlighted the critical role of new technologies and automated threat detection as they warned that the BoE is under regular attack from malicious actors and cyber criminals attempting to hack their systems.
Metro Bank has launched international payments for personal and business customers via its app. The new service enables customers to make same day SWIFT and next day SEPA (Single Euro Payments Area) payments in euros, US dollars and sterling to more than 38 countries.
Barclays has chosen Indian technology giant HCL to lead its investment in artificial intelligence (AI) and automated digital workplace systems for 80,000 employees worldwide, as it announced plans to wind down its operations centre in Lithuania.HCL Technologies, headquartered in Noida, India, will also be providing banking mainframe services to Barclays as part of the plan to expand their existing IT infrastructure services deal.
The term Open Banking has become overused in the industry and customers don’t know or care about it, according to Nationwide’s head of transformation. Speaking as part of a panel at the FinTech Connect conference, Matt Perks argued that the problem is not about educating people about the changes which force banks to share personal data, “but developing the compelling products and services that convince them of the value of giving over their data”.
The UK is now the third largest market in Europe for financial app downloads - with a 19 per cent growth since 2017 - yet Brits currently show significant ‘app-athy’ for technology that can help them save and invest. This is according to Wealthify, which revealed that 11.2 million downloaded money management apps remain unused on mobiles and tablets.
Established financial institutions should stop seeing FinTech startups as an “annoying mosquito” circling their business and strike up partnerships with their more nimble digital rivals, according to a panel of experts. Speaking at the FinTech Connect conference yesterday, a group of startup funding experts agreed that the only way for established players to adapt to the pace of digital disruption was to reach out to innovative challengers.
Mobile payments systems provider Ondot Systems has launched a range of digital solutions aimed at enabling the UK and Europe’s largest incumbent banks to compete with and disrupt emerging FinTech challengers. The firm uses a machine learning driven platform to offer control over card usage, digital card issuance, secure online and autonomous payments, and location tracking services to over 4,000 financial institutions worldwide.
R3 has launched Corda Settler, an application built to allow for payment obligations raised on the Corda blockchain platform to be made through any of the world’s payment systems, both traditional and blockchain-based. XRP is the first cryptocurrency to be supported by the Settler, bringing the Corda and XRP ecosystems into closer alignment.
Voice authentication firm Pindrop has closed a $90 million Series D funding round led by Vitruvian Partners. Other new strategic investors include Allegion Ventures, Cross Creek, Dimension Data, Singapore-based EDBI, and Goldman Sachs. Existing investors CapitalG, IVP, Andreessen Horowitz, GV - formerly Google Ventures - and Citi Ventures also invested in the round.
New research from LINE Corporation has revealed that when it comes to using mobile apps to access financial services, people in the UK are more negative than the global average. A survey of 5,000 smartphone users in seven key markets found that only 40 per cent of Brits would be willing to wire money on a mobile app (versus 57 per cent overall), with 53 per cent willing to open a savings account (versus 65 per cent overall) and just 28 per cent willing to make investments (compared to 45 per cent overall).
Digital transformation is driving turmoil among financial services organisations and leaving sensitive data at risk, according to the 2018 Thales Data Threat Report. The security firm’s analysis suggested that the industry has hastily entered the digital transformation era, but this is not balanced with appropriate security measures. Almost two thirds (65 per cent) of financial services firms have now suffered a data breach, with 28 per cent having suffered a breach in the past year.
One in four people under the age of 37 - those in so-called Millennial and Generation Z demographic groups - are using digital-only challenger banks and 14 per cent of UK bank customers across all age groups have at least one mobile-only digital banking provider – with up to a third of under 37s having two or more accounts with challenger banks. This is according to an independent study undertaken by Censuswide on behalf of Crealogix in November, interviewing 2,000 18-65 year olds who currently have a bank account.
Big data giants like Amazon and Alipay pose an “existential” threat to traditional banks, the head of the Bank for International Settlements has said. In an interview with Reuters on the sidelines of an international banking conference, Agustín Carstens said that the volumes of data which tech companies gather on customers potentially gives them an advantage over established retail banks in terms of assessing risk for lending purposes.
Allied Irish Banks (AIB) has adopted Nuance Communications biometrics technology to let customers access their accounts over the phone without using passwords. AIB deployed the Nuance Security Suite within its contact centre, so customers simply speak to verify their identity when calling. Those who opt in for this service are authenticated by saying “My voice is my password” as a unique voiceprint.
IBM Services will be the global preferred implementation partner for UK-based software company Thought Machine’s cloud-native core banking platform, Vault. Thought Machine created Vault to give traditional banks with legacy systems a solution to be able to fight back not only against new players, but to also adapt to meet the new demands of customers and regulators.
The second Payment Service Directive (PSD2) and Open Banking reforms are levelling the playfield for new entrants, with 55 per cent of digital-first challenger banks and 61 per cent of FinTechs feeling more confident that they can compete with existing banks. This is according to research from Cognizant, with also found that incumbent banks seem oblivious to the trend, with only 36 per cent seeing the threats of the new landscape.
Zopa has received its banking licence, making it the world’s first combined peer-to-peer (P2P) lender and digital bank, paving the way for the launch of a new selection of personal finance products. Back in April, the UK FinTech announced a restructure to establish separate boards for the Zopa P2P business, proposed bank and group, with the appointment of two new board chairs and two new independent non-executive directors – Christine Farnish became chair of the P2P board and Peter Herbert chair of the proposed bank.
Nearly a quarter (24 per cent) of consumers would refuse to convert to a completely cashless society and will continue use traditional methods of payment for as long as possible, according to a new study. A survey of 1,000 consumers in the UK, Australia, Brazil and South Africa by foreign exchange firm Travelex also found that the popularity of cashless methods of payments such as credit and debit cards, digital wallets and wearable technology, is highest amongst 36-45 year olds, rather than young Millennials.
Microsoft and Mastercard are partnering for a new digital identity solution which offers internet users the option to dispense with multiple passwords and verify themselves instantly online. The software giant announced it was joining forces with the payments provider to develop a decentralised identity product that will alleviate the burden on individuals when it comes to providing digital or physical proof of identity as part of the online verification process.
Calastone has announced that its entire global network of more than 1,700 financial organisations, across 40 global markets, will be migrated to blockchain in May 2019 via its new Distributed Market Infrastructure (DMI). The global fund transaction network stated that it believes the overall global cost of fund distribution could be reduced by as much as £3.4 billion, achieved through the technological mutualisation of the trading and settlement processes.
Certua has launched its Enterprise Insurance platform, allowing companies to access the full service via Application Programming Interface (API). The FinTech’s offering is designed to allow companies looking to distribute new insurance products to get to market quickly, and to enable insurers and re-insurers to access digital markets by removing technological barriers to entry.
United Nations secretary general António Guterres has launched a global task force charged with recommending strategies to harness the potential of financial technology to advance the Sustainable Development Goals (SDGs). The Task Force on Digital Financing consists of leaders from a range of sectors from both developed and developing countries. It is co-chaired by Maria Ramos, chief executive of the South African Absa Group and Achim Steiner, administrator of the United Nations Development Programme.
Following discussions during the summer, the founders of Insurtech UK held its inaugural meeting this week. The group’s intention is to develop into a formal association in 2019, with an initial five-year mandate. As well as supporting InsurTechs with some of their day-to-day challenges, Insurtech UK will seek to drive forward conversations with government, industry and regulators, as well as working alongside incumbents and established trade associations to address many of the issues facing the UK’s insurance industry.
The European Central Bank (ECB) has launched a pan-European service for settling electronic payments instantly. TARGET instant payment settlement (TIPS) uses central bank money to settle payments individually in less than 10 seconds. TIPS went live this morning, with the first transaction taking place when a client of the Spanish bank, CaixaBank, used TIPS to make an instant payment to a client of the French bank, Natixis.
OpenLegacy has closed a funding round of $30 million, led by Silverhorn Investment Advisors and joined by CommerzVentures, C. Entrepreneurs, Leumi Partners; O.G. Tech Ventures, Prytek-GFS Group and RDC. The microservices-based API integration provider’s chief financial and operations officer Ron Rabinowitz explained that the funding will support worldwide expansion and enables the platform to increase its market share.
A new Open Banking platform, providing consumer bank account data free-of-charge to mortgage finance providers, is set to launch next week. LendingMetrics’ OpenBankVision will allow users access to 90 days of bank statements with no minimum or maximum cap on the number of requests, when it goes live on 3 December.
The Bank of England (BoE) has published the responses to a consultation on the adoption of the ISO 20022 common global messaging standard for payments in the UK, with broad industry support for the plan. The consultation - in conjunction with Pay.UK and the Payment Systems Regulator (PSR) - received over 70 responses from a range of stakeholders, from established banks to FinTechs and corporates, as well as a number of payments industry trade associations.
More than 70 per cent of businesses are planning to transfer their business functions to the cloud, despite rising fears over cybersecurity risks amongst IT professionals. A study of 1,200 senior IT decision makers from across the Europe, Middle East and Africa (EMEA) region, commissioned by data centre provider Equinix, found that 71 per cent were gearing up to shift operations to the cloud in the coming years.
Revolut has been granted a Remittance License by the Monetary Authority of Singapore, as well as Stored Value Facility approval, which will allow the digital-only bank to operate in Singapore. The London-based FinTech is also working with Singapore’s financial regulator to shape the upcoming Payment Service Bill. Meanwhile, in Japan, Revolut has been fully authorised by the Japanese Financial Services Agency (JFSA) under the Fund Transfer License to operate throughout the country.
Challenger payments company MuchBetter has released its ‘bank-in-a-box’ fully managed solution. This enables organisations to launch branded production wallets quickly and easily, letting them take control of users’ payments experience and get to market faster with a compliant and low-cost financial product. The white-labelled payments service is designed to be secure, while offering a frictionless experience for the end-user, letting them make online and offline payments with just their phone and fingerprint.
More than three quarters (77 per cent) of financial services decision-makers think artificial intelligence (AI) will play the biggest role in revolutionising the industry in the next five years, according to new research. A survey of more than 500 financial services executives in the EMEA region for Intertrust, an administrative services provider, revealed that 65 per cent think that so-called disruptive technologies such as AI, blockchain and robotics will have a positive impact on their business operations, particularly in driving back-end efficiencies in areas such as Know Your Customer (KYC) reporting, due diligence and compliance.
Established banking giants are ripping customers off with hidden fees and a lack of transparency, driving Millennials to embrace a new generation of digital banking services, according to N26’s head of international markets. Speaking after the German digital bank launched its current account service in the UK last week, Alexander Weber told FStech that bank fees and account charges were partly to blame for pushing young people towards mobile-only banking, with 1,000 UK customers signing up to N26 every day in the past week.
The Competition and Markets Authority’s (CMA) Phase 2 investigation has provisionally found that Experian’s takeover of ClearScore is likely to result in less intense competition, potentially harming the development of digital personal finance products. The CMA referred the proposed merger between the credit score checking firms for a more in-depth investigation in July, following initial concerns that the deal could have a negative impact on the services provided to customers.
RegTech startup Alyne has raised €3 million in a Series A financing round led by Alstin Capital, with participation from Hannover Digital Investments. The investment bring Alyne’s total funding to a total of €4.2 million and will be used to scale its operations and expand its customer base. The startup already counts among its customers the likes of Barclays, Deloitte, Allianz and Solarisbank.
Over half of customers would not mind if their local bank branch closed, while 56 per cent felt that the level of customer service on personal finance apps is the same as in-person. This is according to research conducted in September by Google Consumer Surveys and Webpals Finance, based on a representative sample of more than 500 US adults.
The Financial Conduct Authority (FCA) sees “no end in sight” to the rapid rise in the number of IT failures and cyber attacks on the financial services sector, the regulator’s head of supervision has warned. In a speech given at Bloomberg’s London headquarters, Megan Butler, executive director of supervision over investment, wholesale and specialists at the regulator warned that she sees “no immediate end in sight” to the disruption caused by inadequate cyber defences.
Businesses in Ohio are now able to pay their taxes in Bitcoin — making it the first US state to officially accept cryptocurrency. Companies that want to take part in the new program visit an official website and register to pay anything from cigarette sales taxes to employee withholding taxes with the virtual currency of their choice.
Mobile bank Atom has partnered with cloud platform Thought Machine for the next stage of its business banking and mortgage lending services. The digital bank has signed a multi-year partnership with the banking software FinTech to put its next generation of personal and business banking products onto the Thought Machine Vault platform.
Monzo has announced a new £20 million crowdfund campaign to back up a Series E funding that has seen it raise £85 million. The raise, which will be run on Crowdcube’s funding platform, is set to be the largest crowdfunding offer to date for a UK FinTech. Customers will be able to invest up to £2,000 directly through their app.
New research into Open Banking implementation has found that financial institutions have struggled to recruit engineering talent for projects, with many lacking enough personnel and the necessary skillsets to stay or become compliant. LM Research & Marketing Consultancy conducted an online survey on behalf of Fiserv between August and September among 400 respondents in the UK, Poland, France and Australia, with 100 respondents from each country. Respondents represented retail banks of asset values from less than $250 million to more than $300 billion.
Mobile banking customers at Lloyds Bank, Halifax and Bank of Scotland will now be able to track their spending on Google Maps thanks to a new app integration. The introduction of an in-app Google Maps feature will allow customers to pinpoint the exact location and details of debit card transactions. Additional card controls will allow customers freeze cards to protect against fraud, whilst nudges will help users to manage spending.
PayPal’s $2.2 billion takeover of Swedish mobile payments company iZettle could drive up prices for customers and lead to a more limited range of services, according to an investigation by the Competition and Markets Authority (CMA). The UK’s competition watchdog will now refer the merger - completed in September - for a Phase 2 investigation after it found that the deal - which brings together the two largest suppliers of mobile point of sale (MPoS) devices in the UK - could lead to a “substantial lessening” of competition within UK markets.
In the six months since the General Data Protection Regulation came in, there has been an exponential increase in the number of consumers wary of how their personal data is being protected. Since the 25 May deadline, more than 1,100 reports of data breaches involving people’s personal information were received by the Data Protection Commission in just the first two months – a number that has gone up exponentially since then.
The Payment Systems Regulator (PSR) has published its consultation for Confirmation of Payee (CoP) rules to protect people from Authorised Push Payment (APP) scams. Together with the new, voluntary code, designed by the industry and consumer groups, CoP will see consumers better protected from APP scams and have a greater chance of being reimbursed if they do fall victim.
Chip has completed a Series A funding round on Crowdcube, raising more than £4 million and attracting a record-breaking 7,000 investors on the equity crowdfunding site. The savings app has already grown to 75,000 accounts, processed £58 million of savings and received £36 million of deposits since receiving Crowdcube's third biggest raise last year (£2.4 million).
HSBC has apologised after UK customers reported issues logging into its mobile banking app today. The lender has said its app is now back up and running after customers flagged problems viewing their accounts and moving money this afternoon. The bank said online banking services were unaffected by the glitch.
The UK online alternative finance market volume grew by 35 per cent in 2017, to £6.2 billion from £4.6 billion in 2016, as peer-to-peer (P2P) business lending became an increasingly important part of overall financing of smaller British businesses. This is according to the 5th UK Alternative Finance Industry Report by the Cambridge Centre for Alternative Finance (CCAF).
RegTech startup SteelEye has raised £5.7 million in its latest funding round, led by Illuminate Financial. The London-based startup, launched in October last year, uses cloud-based technology to help clients solve compliance challenges created by EU and UK regulation, including MiFID II, MAR, EMIR, Dodd Frank and other international regulatory obligations.
The Treasury Select Committee is to launch an inquiry into IT failures in the financial services sector after a series of meltdowns at High Street banks left millions of customers facing disruption to their online banking services. MPs on the influential parliamentary committee said they will examine the operational resilience of IT systems at banks and financial institutions, and their ability to get services back up and running if a failure occurs.
Aviva has agreed to acquire a majority stake in Neos Ventures, the smart technology insurance provider which helps customers monitor and protect their homes with connected devices. The agreement builds on Aviva’s existing relationship with Neos. The insurer, through its corporate capital venture fund, Aviva Ventures, announced a strategic investment in Neos in 2017.
More than half of financial services firms are experiencing a drop in performance due to key digital services and applications at least once a week, according to a new report from Riverbed that found the industry is not moving fast enough to address digital change. A survey of 1,000 decision makers in a range of industries, based in nine countries, found that 79 per cent of teams are held back by poor performance of digital systems at least a few times per month.
The emergence of international co-ordination on blockchain technologies is paving the way for the “decentralised economy" of the future, according the BBVA’s head of research and development.The Spanish banking group has become of the first five banks invited by the European Commission (EC) to join its forum event on blockchain technology.
In-app payments are the next priority for Yolt, as it looks to expand its offering and avoid ‘app apathy’. The money management app’s chief executive Frank Jan Risseeuw told FStech that his team is working hard on payments functionality. “We’re currently in alpha testing on this and as always, we’re working closely with our community to make sure our end product answers user’s needs.”
Starling Bank has appointed Helen Bierton, a former Olympic archer and Santander executive, as its new head of retail banking. Bierton, who represented Great Britain in the Athens Olympics in 2004, will join the digital challenger bank from Santander, where she has worked since 2007, rising to her current role as director of products at Santander Business UK.
Global fundraising for InsurTech startups during 2018 has already reached an all-time high in volume, with 204 deals and transaction values of $2.6 billion, close to the 2015 peak of $2.7 billion. The report from mergers and acquisitions advisors Hampleton Partners showed that since 2016 the InsurTech sector has reported 151 transactions, with 22 buyers making more than one acquisition.
Open Banking is one of the most radical changes in the recent history of financial services and has already dramatically impacted investment decisions within the industry, according to TLT. The UK law firm’s new research, based on survey responses from 130 senior decision makers representing a range of financial firms across the UK, found that a vast majority (84 per cent) are investing in Open Banking products and services.
The Financial Conduct Authority (FCA) is looking for a new director of innovation, tasked with driving “engagement with technological innovation within the financial services industry while developing, new, innovative and data-led ways of regulating”. The job advert - posted earlier this month, with a deadline at the end of November - states that the newly-created role will have a large impact on the FCA and the achievement of its objectives through helping build approaches in innovation, FinTech, RegTech, advanced analytics and data.
Data infrastructure firm Equinix is pumping £90 million into an upgrade of its data centre in London to keep up with demand from the UK’s digital economy. The new International Business Exchange Centre will be built at Equinix’s existing London Slough campus. Equinix said the new centre will provide the increasing data infrastructure needed by City firms to support IT transformation initiatives and increasing adoption of cloud-based technologies.
Payments technology startup Form3 has raised £10.1 million in Series B funding led by Barclays, Angel CoFund and FinTech backer Draper Esprit. The payments-as-a-service (PaaS) firm, started in London in 2016, provides cloud-based payments processing for banks and regulated FinTechs including Tandem Bank, Starling and N26.
Plastiq has raised $27 million in Series C financing, led by Kleiner Perkins with participation from DST Global. The US startup which aims to let users pay for anything via credit card will use the money to accelerate growth and roll out new services. Kleiner Perkins general partner Ilya Fushman, will join the board of directors as part of the deal.
German digital challenger bank N26 has launched to British customers after its banking services were opened up to 70,000 people on an early access waiting list.The UK-wide roll-out of the mobile bank follows launches in Denmark, Norway, Poland and Sweden earlier this month, taking its number of operating markets to 22 since the company started in 2015.
European digital lenders are growing quickly, but digital share is still low relative to the market opportunity, according to a whitepaper from Mitek and FinTech research practice Autonomous NEXT. “The digital lending sector has grown dramatically in the last few years and is a great example of how technology can democratise access to financial services – but banks still dominate lending, and digital-first lenders are struggling to provide loans on better terms than their traditional rivals given high cost of capital,” said Lex Sokolin, global director for FinTech strategy at Autonomous NEXT.
Financial data startup Banked has secured £1.5 million in seed funding to help develop its first data integration product using Open Banking protocols.The FinTech will close its latest seed raise for the UK market with the contribution from lead investor Backed VC, a €50 million London-based seed stage fund.
TSB Bank is set to appoint Clydesdale Yorkshire Bank Group (CYBG) chief operating officer Debbie Crosbie as its new chief executive.She will replace Paul Pester, who stood down in September after the bank suffered a series of major IT failures.
Dutch banking software firm Five Degrees and British digital engagement company ieDigital have launched a digital banking portfolio for financial institutions.It consists of a cost effective method to build end-to-end banking products that help to identify and generate revenue opportunities, combining ieDigital’s ‘Interact’ digital engagement platform, with Five Degrees’ ‘Matrix’ core banking platform.
The banking and payments industries have been warned to strengthen security controls by new analysis of the cyber threat to the financial markets.A report from BAE Systems and SWIFT has revealed that the financial securities market is particularly vulnerable to cyber attack.
Digital challenger bank Tandem has invited its existing app users to help test a new Autosavings proposition. During the beta phase, users will be encouraged to feedback suggestions for improvement, report bugs and discuss their savings habits to help build a product that is relevant for them.
The next financial crisis may be triggered by a cyber attack, according to a senior executive at the European Central Bank (ECB). Whilst giving the opening remarks at the CPMI academic conference in Basel, ECB board member Benoît Cœuré said that hackers are increasingly targeting wholesale payment systems and the large money flows they handle, citing the lapses in security that led to the $81 billion heist at the Bank of Bangladesh in 2016.
Robotic processing company Automation Anywhere has raised $300 million in Series A funding from SoftBank’s Vision Fund. The California-based firm’s software makes use of artificial intelligence (AI) enabled bots to automate repetitive manual and administrative tasks to drive efficiencies and scale business processes.
Financial services providers can expect free movement of capital and payments along with alignment in data flows after Brexit under an outline deal put forward by Theresa May, which has prompted a cautiously optimistic response from The City. The details of the government’s proposed Brexit withdrawal agreement include a ‘political declaration’ highlighting the importance of the financial sector to the UK economy and outlining an ambition for close alignment and equivalence arrangements when it comes to regulation and data flows between the UK and EU after Brexit.
Monzo is partnering with the UK Financial Capability Lab to develop new technologies to help customers regain control of their finances. The collaboration will see the digital challenger bank work alongside the Money Advice Service and the Behavioural Insights Team to make use of financial data on spending and saving that can help customers limit their outgoings.
Digital challenger banks enjoyed success at last night’s Payments Awards, with Starling Bank and ClearBank both picking up two awards each. The sixth annual industry event was held at the Grosvenor Square Marriott hotel in London, with a record number of entries across the 24 categories.
The Monetary Authority of Singapore (MAS) has released a consultation paper on the creation of a ‘Sandbox Express’ to let firms conduct experiments more quickly. These pre-defined sandboxes would complement the existing FinTech Regulatory Sandbox that was launched in 2016, but would let firms work on projects without needing to go through the existing bespoke application and approval process.
CivilisedBank has resubmitted its banking licence application to the Bank of England.The FinTech startup, which offers digital business banking services and advice from banking experts to SMEs has also announced further funding from main shareholder Warwick Capital Partners along with investment from a FTSE100 pension fund.
The head of the International Monetary Fund Christine Lagarde has raised the prospect of central banks around the world issuing their own digital currencies. Speaking at an event in Singapore this morning, the BBC reported that Ms Lagarde addressed concerns raised by regulators over the growth of digital currencies such as Bitcoin, which allows for unregulated and anonymous transfers of value between digital wallets, leaving the door open to criminal uses.
Tandem Bank is partnering with Stripe to offer an automatic savings functionality to customers, enabled by Open Banking. The digital challenger bank announced its tie up with the global payments platform as part of its plans to offer users a range of new in-app and data-driven savings tools.
Nationwide is taking a minority stake in Moneyhub, the platform that consolidates accounts from different providers to help consumers manage their money. The investment is the building society’s third deal as part of a £50 million Venturing Fund launched in September. Nationwide is making strategic investments in and partnering with early stage startups exploring innovative products and services that could provide real benefits for its members in the future.
Starling, Tide, TransferWise, Revolut and Soldo have announced a global in-app integration with accounting platform Xero. The digital accounting platform is using its new Open Banking API (Application Programming Interface) to feed bank data in real-time to its data management system.
Pay.UK has invited interested parties to help develop an ‘Enhanced Data’ capability as part of the New Payments Architecture (NPA) programme. Enhanced Data offers the capability to add additional information to payments, as standardised, structured data creating both a larger capacity and wider range capable of transmission.
New research has revealed that 94 per cent of banks and financial institutions are planning two or more FinTech acquisitions in the next 12 months. Reed Smith and Mergermarket interviewed 100 corporate senior executives globally, finding that key drivers for FinTech investment included the need for enhanced compliance and reporting functionality, upgrading legacy IT systems, and improved customer outreach through digital channels.
Revolut has developed a new machine learning technology for tackling card fraud and money laundering. The challenger bank says its automated customer profiling technology detects patterns in financial behaviour and can spot fraud and money laundering in real-time, leading to a fourfold reduction in card fraud since it was launched in August.
Swiss software as a service (SaaS) and wealth management solutions firm Avaloq has launched a new venture capital fund focused on startups and fast-growing FinTech firms. The new subsidiary, Avaloq Ventures, will fund for FinTechs partnering with Avaloq, by offering their solutions on Avaloq’s Software Exchange.
UK customers are more willing to embrace Open Banking apps offered by traditional High Street banks than the offerings of digital challenger banks, according to new research. A survey of 2,000 UK consumers by YouGov for a software analytics firm New Relic assessed appetite amongst consumers for a consolidated banking app which uses Open Banking APIs to allow customers to manage multiple financial accounts in one app.
Comparison site Moneybrain has today announced the launch of a new asset-backed utility token.The BiPS Token, created in collaboration with JustUs, Moneybrain’s peer-to-peer sister company, is understood to be the first asset-backed token created and minted by an Financial Conduct Authority-regulated authority.
Revolut is opening up its data and machine learning tools to employees across the business, following the roll-out of a new analytics dashboard. Following a six-month trial, UK-based digital banking platform signed a deal with Exasol to provide a cloud-based central data repository and data management platform, available to all employees - from data scientists to frontline service and HR staff - with gradations of access depending on the sensitivity of customer and commercial data.
Allianz Global Investors will be hosting its first hackathon in London later this week. The investment manager’s in-house specialists and artificial intelligence (AI) experts from selected global startups will work together to develop optimisation approaches.
Starling Bank is partnering with the Post Office to provide digital banking services to its customers across the UK, including rural communities which have been left with no access to a local bank branch. The mobile-only challenger bank will provide everyday banking services to its personal and business customers at 11,500 branches across the Post Office’s network.
Brexit uncertainty has so far barely dented the UK’s ability to attract high-skilled technology professionals from abroad, according to new analysis by Indeed. The job site’s data showed that one in 10 enquiries about currently available British tech jobs comes from jobseekers outside the UK. Tech-related roles are especially popular among non-EU jobseekers, and three of the four most in-demand UK jobs among high-skilled global jobseekers are in technology.
TransferWise has completed a £65 million syndicated debt facility with NatWest, JPMorgan and LHV Bank to support the increasing requirements of its growing international customer base. Launched in 2011, the London-based FinTech offers customers an easier and quicker option to manage money across borders, and now counts four million customers and moving £3 billion of money each month.
The Bank of England (BoE) is conducting a cyber security ‘war gaming’ exercise with banks and financial institutions today to test the UK’s resilience in the face of a major cyber attack. Around 40 firms, including the UK’s biggest banks, are to take part in the one-day drill, which will simulate the impact of a major cyberattack.
New data has shown that the uptake of mobile payments such as Apple, Google and Android Pay in the UK has quadrupled over the last two years. The Cardlytics figures are based on 190 million transactions made by 6.4 million bank customers in the UK who actively use their cards once per week, looking at all transactions during the last two years.
IBM is partnering with data storage firm Seagate Technologies to develop a blockchain solution to product counterfeiting.The joint project is focussed on using distributed ledger technology (DLT) to prevent the growing use of counterfeit hard drives. Global trade in counterfeit and pirated electronic products has reached more than $1.7 trillion in value, according to the figures from the International Anti-Counterfeiting Coalition.
Virtusa Corporation will lead a global effort in creating the API Exchange (APIX), the world's first cross-border, open-architecture platform to improve financial inclusion. The platform will include an online global FinTech marketplace and sandbox platform, aimed at accelerating financial services innovation by enabling collaboration between financial institutions and FinTech innovators.
Peer-to-peer lending platform Zopa has closed its latest fundraising round at £60m, making it the largest raise for the company yet. Zopa, one of the UK’s so-called ‘big three’ peer-to-peer lenders, said it will put the funds towards planning for the launch of a full 'next generation' banking operation.
Barclays has launched an app-based invoicing platform for its small business customers.The free service will enable users of the Barclays Mobile Banking app to create, send, track and manage invoices.
InsurTech startup yulife has raised £3 million in a funding round led by LocalGlobe, the UK investor behind LoveFilm and TransferWise. Fintech investor Anthemis and Israeli venture investor OurCrowd also joined the round, which bolsters the company’s coffers ahead of its launch this week. In June, yulife confirmed that all its policies will be underwritten by AIG Life, the UK life insurance arm of US insurer AIG.
Lloyds Banking Group has announced a strategic partnership with Thought Machine, as part of its plans to accelerate digital transformation. In conjunction with this partnership, Lloyds has made an £11 million investment in Thought Machine, representing a 10 per cent stake, as part of its Series A £18 million investment round.
Accenture is investing in data analytics software firm Quantexa as part of plans to accelerate the development of its artificial intelligence (AI) and financial crime fighting capabilities.Accenture Ventures, the financial consultancy's investment arm, has made a minority investment in UK-based Quantexa. The deal will enable Accenture to combine its Applied Intelligence technology with Quantexa’s network analytics platform to help banking clients better identify fraud and financial crime.
Business improvement company BSI and the government-backed Fintech Delivery Panel have launched new guidance to improve engagement between FinTech companies and financial institutions. The guidelines have been jointly created by the Royal Bank of Scotland, Barclays, HSBC UK, Lloyds Banking Group, and Santander, which sit on the Fintech Delivery Panel. FinTechs such as MarketInvoice, The ID Co. and iwoca also contributed, with all parties identifying the issues that prevent startups and established firms becoming allies.
Dubai-based bank Emirates NBD has launched an Application Programming Interface (API) sandbox, as part of an AED1 billion investment in digital transformation. Abdulla Qassem, group chief operating officer at Emirates NBD, called the open banking sandbox environment “a game-changer” that will simplify and accelerate innovation for the bank’s employees, partnerships with FinTechs, startups, developers, academia and small businesses.
Oracle and B-Hive have jointly launch a fast-tracked monetisation ecosystem program for mature startup and scale-up FinTechs, called Fintech ScaleUp, following their Fintech Innovation Program collaboration in July. Registration opens today and the program will start in January, when Oracle and B-Hive select 15 startup or scale-up FinTechs in two program sessions taking place in Brussels and London.
NatWest has launched a standalone digital banking platform for small and medium businesses (SMEs) called Mettle.The mobile-app based bank, developed in partnership with 11:FS and Capco, is currently in pilot mode and has been rolled out to between 100 and 150 existing and new customers, who will provide feedback on its features before a general roll-out to the public.
Icelandic state bank Íslandsbanki has invested €3 million in digital banking solutions provider Meniga. This brings the total investment in the company from banks this year to €9.1m, following Swedbank´s investment in April and the strategic partnership announced with UniCredit in June.
The UK is leading the boom in European funding for tech firms, with a total of €829.9 million injected into early stage companies in the last three years. Figures released jointly by Stripe, Tech.eu and Techstars at Lisbon’s Web Summit show that investment in early stage technology (EST) startups in Europe has increased four-fold since 2015, up from €875 million in the first six months of 2015 to more than €3.6 billion in 2018.
Financial services firms in Europe are turning to artificial intelligence (AI) as they battle to make sense of their data and deliver more relevant, personalised customer service, while staying on the right side of the General Data Protection Regulation (GDPR). This is according to Adobe, which commissioned research company Coleman Parkes to interview 600 senior business decision-makers, comprising 100 respondents from the UK, Benelux, France, Germany, the Nordics and Switzerland during August and September.
Lloyds Banking Group is creating 2,000 new roles as part of an 8,000 job restructure aimed at focussing its operations on digital technology. The High Street lender is set to cut 6,000 jobs but create a total of 8,000 new roles over the course of the next two years as part of a £3 billion digital transformation plan announced in February.
Atom Bank is partnering with researchers from Newcastle University to research issues of security and data and create a toolkit to help businesses design appropriate interactions with customers. One of the first applications of the research will be in the development of blockchain to build better mortgages, drawing on blockchain expertise from Newcastle University’s Computer Science department and crypto-statisticians at the Durham University’s Department of Mathematical Sciences.
Deutsche Bank is moving its global cheque processing operations to the cloud after signing a strategic partnership with HCL Technologies. The German investment bank announced that the Indian technology firm is to build a cloud-based, fully-scalable digital cheque processing platform which is expected to go live in 2019.
Experian is launching a new range of services to help lenders evolve their approach to making consumer credit decisions, via a ‘multi-dimensional’ view of a borrower’s financial health. Experian Credit 3D uses trended and alternative data sources so banks and businesses can access a new set of insights, enabling faster decisions based on a more rounded picture of affordability.
Deutsche Bank’s asset management arm DWS Group is expanding into Dubai’s FinTech scene with an agreement to purchase a 15 per cent stake in Neo Technologies, a digital asset technology and consultancy firm. DWS announced the strategic partnership with Neo Technologies as the FinTech, based in Dubai’s International Financial Centre, looks to expand its digital investment platform services across the Gulf region.
UK software startup Vizolution has landed a total of £10 million funding from HSBC, RBS and Santander to grow its customer experience technology business. The UK-based Software-as-a-service (SaaS) firm secured the funding from three of the largest European banks following a period as clients of Vizolution's software solution.
Financial consulting firm deVere has launched a range of cryptocurrency investment solutions.In a further sign that the asset management and investment industries are embracing the trend for cryptocurrency such as BitCoin, deVere has announced that its Digital Asset Funds will now be available for experienced investors.
FStech is today launching a new one-day conference focussed on regulatory technology within financial services. RegTech Live will bring together experts and industry leaders for a day of debate, networking and panel discussions on 28 February 2019 at the Hilton Tower Bridge.
Bank branches are set to disappear from UK High Streets by 2041 according to a new study which also predicts that ATMs will be a distant memory within 20 years. Expert Market, a card payment comparison site, conducted an analysis of data compiled by the House of Commons library, consumer watchdog Which? And link.co.uk, concluding that the rise in digital and mobile banking being led by the millennial generation makes the decline of physical stores “inevitable.”
Regulatory action on operational resilience within financial services firms is likely to increase the urgency with which IT and data security work is considered at board level, according to experts.In July, the Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) published a joint discussion paper on an approach to improve the operational resilience of firms and financial market infrastructure, in the wake of scandals involving the likes of TSB and Visa.
A new report from Microsoft on the future of artificial intelligence (AI) has revealed that two out of five industry leaders believe their current business models will disappear in the next five years due to the pace of digital disruption. A study of more than 1,000 business leaders and 4,000 employees conducted by YouGov and Goldsmiths University of London collected data on AI-adoption from across a range of British industries.
FinTech iwoca has become the first startup lender to release Open Banking services to small businesses after it announced a successful integration with Lloyds Bank. Under the Open Banking Initiative, Iwoca, which offers credit facilities to small businesses in the UK, Germany and Poland, will enable users with a Lloyds Bank account to securely link their account data and upload up to five years of transaction history to Iwoca via the Open Banking API.
Monzo has secured £85 million in a series E funding round with a valuation of £1billion, propelling the challenger bank into the ranks of the UK’s FinTech ‘unicorns’. The funding round was led by US investors General Catalysts and Accel, joined by existing backers Passion Capital, Goodwater, Thrive Capital, Orange Digital Ventures and Stripe.
The market for API-driven financial services such as Open Banking is still in the “immature” stages of development, according to Nationwide’s head of digital and mobile. Speaking to FStech at an event organised by cloud platform service Amazon Web Services, James Smith, director of mobile and digital at Nationwide building society, said his organisation was currently at the iterative, testing phase for a number of API integrated products as part of a £4.1 billion technology transformation planned for the next five years.
The overwhelming majority of financial services chief investment officers (82 per cent) believe there is a risk their organisation could roll-out Internet of Things (IoT) strategies without having a plan in place to manage performance. Research from software intelligence company Dynatrace suggested this would be extremely damaging, with 69 per cent of CIOs predicting IoT will become a major performance burden, as they struggle to overcome the complexity that the technology introduces.
Coinbase has raised $300 million in a Series E funding round, giving the cryptocurrency exchange a valuation of more than $8 billion – up from $1.6 billion at its last financing in April 2017. The investment was led by Tiger Global Management, along with Y Combinator Continuity, Wellington Management, Andreessen Horowitz, Polychain and others.
Despite the hype, research by IDEX Biometrics has revealed that mobile payments are almost as unpopular as cheques, with payment cards still being the number one method when it comes to in-store purchases for UK consumers. The fingerprint identification technology firm carried out 1,000 interviews in the UK using an online methodology amongst a nationally representative sample of adult consumers. It found that three quarters of respondents use cards - including contactless - most often, compared to cash (21 per cent), mobile payments (three per cent) and cheques (one per cent).
Eight out of ten UK banking customers would opt for biometric payment cards for increased security, according to a new study. A survey of 821 UK cardholders for digital security firm Gemalto revealed that more that half (54 per cent) would be ready to use biometric fingerprint scan cards if they were available from their bank, and 83 per cent said it would become their preferred payment card. Earlier this month, Societe Generale became the first French bank to announce the roll out of biometric-enabled cards which let users authorise payments with a touch of their finger on a sensor as an alternative to the PIN code. The sensor is powered by mobile point of sales (MPoS) devices.
Startupbootcamp has launched a FinTech Accelerator program in Dubai to support the city in its bid to become a world leader in financial services innovation and technology. Over the next three years - in partnership with Dubai International Financial Centre (DIFC), Visa and HSBC - Startupbootcamp will accelerate 40 startups working in a range of fields impacting financial services innovation, such as artificial and machine intelligence, distributed ledger technologies and digital banking.
The UK government has announced plans for a two per cent digital services tax on the revenues of global tech giants, aimed at raising £400 million a year.Setting out his 2018 Budget, the chancellor Philip Hammond announced that a narrowly targeted group of “established tech giants” will be taxed in the UK from 2020 to ensure that multi-billion dollar companies pay their “fair share”.
The UK’s financial authorities have published their joint report on cryptoassets, proposing and new regulatory framework and further consultation on specific risks and opportunities. HM Treasury, the Financial Conduct Authority and the Bank of England were tasked with reporting on this emerging part of the industry by the chancellor back in March.
Equifax has launched a new solution which can match identity information - such as the consumer’s name, address and date of birth - with transaction data provided through Open Banking in real time. The latest development in its partnership with consents.online integrates the Equifax Bank Account Verifier with open Application Programming Interfaces (APIs) to reduce fraud by allowing credit providers to confirm that account information belongs to the person applying for credit, and not a potential fraudster.
The head of the Emerging Payments Association has railed against collaboration in the industry, stating that it is “intrinsically impossible” for most companies. In a newsletter, the EPA director general Tony Craddock said collaboration has become this year’s buzzword and questioned why companies should be expected to share with competitors.
More than three-quarters of financial firms will become irrelevant or go out of business altogether by 2030, according to a new survey from Gartner. The research firm suggested 80 per cent of ‘heritage’ financial firms face a bleak future and will struggle for relevance as digital platforms, FinTechs and other non-traditional players expand their market share and use technology to disrupt business models.
Robo-advisor Wealthfront has announced a ‘freemium’ model of its financial planning services. Co-founder Dan Carroll explained that by year end, anyone will be able to download the Wealthfront app, connect all of their financial accounts, build a personalised financial plan and receive recommendations powered by the firm’s automated financial advice engine, Path.
IBM has agreed to buy open source cloud software provider Red Hat for a record tech acquisition price of approximately $34 billion. A statement explained that the deal - approved by both boards, but still subject to shareholder and regulatory approval - will accelerate IBM’s revenue growth, gross margin and free cash flow within 12 months of closing, estimated during the latter half of next year.
The Conference of State Bank Supervisors (CSBS) has filed a complaint in the US District Court for the District of Columbia against the Office of the Comptroller of the Currency (OCC) over its plan to issue bank charters to FinTech firms. “Common sense and the law tell us that a non-bank is not a bank,” commented CSBS president and chief executive John Ryan. “Thus, CSBS is calling on the courts to stop the unlawful, unwarranted expansion of powers by the OCC.”
Digital insurance distributor BGL Group has done a deal to buy Saverd, the company behind personal finance app Bean, subject to regulatory approvals. Following the acquisition, BGL plans to develop the Bean proposition with a new capability to support a group-wide digital transformation.
Sweden’s central bank has announced the next steps in its plans to phase out physical currency in favour of electronic money. The Riksbank stated that as the use of cash continues to decline in the country, in the future, cash may be used to such a limited extent that it is difficult to pay with it.
The chancellor is reportedly set to unveil plans to back the UK’s fastest-growing tech startups though new use of savers’ pensions pots in next week’s Budget. Philip Hammond is preparing to offer a funding boost for ‘scale-ups’ by channelling funds from a so-called ‘patient capital investment trust’ linked to billions of pounds of savers’ retirement pots, according to Sky News.
The Financial Conduct Authority’s chief executive has given a comprehensive update on his approach to Brexit, calling on the EU to engage on important practical arrangements. Speaking at the City Banquet at Mansion House last night, Andrew Bailey said the regulator is on course with its preparations for a range of outcomes, including an implementation period that smooths transition and a hard and sudden exit.
Yolt has added the first investment provider to its money management marketplace – Wealthify. The integration will enable Wealthify customers to view their accounts within the Yolt money app, making it the first in the UK to show users’ live investments alongside their bank account, credit card and savings accounts and even pensions.
Wahed Invest, the UK’s first halal online investment platform, has raised an additional £6 million from existing investors to expand into new territories. Boston-based Cue Ball Capital and Middle Eastern venture capital fund BECO Capital invested the money, which brings total funding to nearly £12 million since inception and raised Wahed Invest’s valuation to over £75 million.
A new report suggests that cyber-attacks on website domain name system (DNS) are costing financial organisations $924,390 a year. A survey of 1,000 large businesses across nine countries conducted by EfficientIP, revealed that that cost of tackling DNS attacks has surged by 57 per cent in the last year, up from $588,200, with 19 per cent of financial companies surveyed saying they had been the target of 10 or more attacks in the last 12 months.
Japan’s Financial Services Agency (FSA) has granted the country’s cryptocurrency industry self-regulatory status, which will permit Japan Currency Exchange Association (JCEA) to police and sanction violations against a new rule book.
Deutsche Bank has hired the Bank of England’s former IT chief to lead its cloud platform operations. The investment bank yesterday confirmed that Deeptastree Mitra would join the Global Transaction Banking (GTB) chief digital office as its head of cloud platforms for data solutions.
The latest current account switching data has shown TSB to be the biggest loser over the second quarter, with a net loss of 16,641 customers, as it battled with continuing problems from a botched IT upgrade. Meanwhile, app-based challenger banks Monzo - which sees data published for the first time this quarter - and Starling showed “noteworthy net gains” for new players in the market, according to the figures from Bacs.
The governor of the Bank of England has called for protections for workers from the pace of technological changes such as artificial intelligence (AI) and machine learning. In a lecture given to a conference on machine learning and the global economy at the University of Toronto yesterday, Mark Carney outlined the role businesses and governments will need to take to ensure that workers do not fall victim to social divisions created by technological disruption.
Despite coming into effect in January, less than a third of Brits have heard of Open Banking, a system that provides a user with a network of financial institutions’ data through the use of Application Programming Interfaces (APIs). Three quarters of respondents to the 2018 Unisys Security Index which had heard of Open Banking said they want to know how their information is being protected by third parties before agreeing to use Open Banking services.
HSBC, ING, NatWest, Standard Chartered, BNP Paribas, SEB, Bangkok Bank and CTBC Holding have joined an open platform for document distribution over the blockchain. The Voltron initiative is set to launch on R3’s Corda Enterprise blockchain platform in 2019, aiming to make transacting letters of credit significantly more efficient.
IBM has announced a financial services-focused platform designed to address increased regulatory requirements and the creation of innovative solutions for digital-savvy consumers. Powered by IBM Watson and Cloud, the IBM Open Banking Platform provides banks with a technology layer on top of their existing systems to let banks choose from a range of IBM and third-party FinTech Application Programming Interfaces (APIs) to add capabilities such as financial risk, payments, artificial intelligence and blockchain to their solutions.
The Banking Industry Architecture Network (BIAN) has announced the launch of its API Exchange, an online digital library containing over 65 standardised Application Programming Interface definitions. The definitions should help to reduce the complexity of building and delivering Open Banking capabilities, providing clear guidance on how to implement, innovative and intuitive digital services across both back-end and customer facing functions.
Two-thirds of banks believe their payments infrastructure will need significant upgrade in the next three years, while almost three-quarters fully expect to replace or renew their payments systems in the same timeframe. This is according to a new report from consulting firm Ovum and released by banking software company Temenos, which highlights that those delaying or deferring required investments risk falling behind the rest of the market.
Paypal has made a strategic investment in Tala, an emerging markets FinTech which lends to undeserved populations through a smartphone app. The online payment services giant has partnered with Tala as part of its commitment to building financial health amongst disadvantaged communities and opening up access to the digital economy.
Fiserv has expanded its agreement with The Co-operative Bank to support its integration of services under the European Union’s Second Payment Services Directive (PSD2). The bank will implement FinKit for Open Banking from Fiserv to enable continuous innovation, customer engagement and easier access to services.
Banks and payments organisations will carry out co-ordinated cybersecurity drills to test their response to major incidents which could cripple sectors critical to the UK's infrastructure.
Last week it was revealed that 20 of the UK’s largest banks, insurers and security exchanges are set to launch the Financial Services Cyber Collaboration Centre (FSCCC) to enable a co-ordinated response to the “clear and present danger” posed by hack attempts and large scale cyber attacks.
Visa has announced new digital identity product details in preparation for a first quarter 2019 launch of Visa B2B Connect. This distributed ledger-based platform is designed to give financial institutions a simple, fast and secure way to process cross border business-to-business payments globally.
UK-based asset intelligence firm Bridgeweave has announced the launch of an artificial intelligence (AI) powered trading insights product for individual investors. The Investment Insights proprietary platform has been built using CognitiveScale’s Augmented Intelligence software to process large amounts of historical, transactional and real-time data.
Security giant G4S is entering the cryptocurrency market with a new service offering high security offline storage that aims to keep digital assets out of the clutches of hackers. The firm, best known for its cash storage and prison services, is launching a secure storage vault to help financial services firms and crypto traders guard their holdings in Bitcoin, Ethereum, Litecoin and other cryptocurrencies from the “wild west” of currency exchanges.
Britain’s leading banks and insurers will join forces to fortify the financial system against cyber attacks with the launch of a dedicated cyber security body. More than 20 of the UK’s largest banks, insurers and securities exchanges are planning the launch of the Financial Sector Cyber Collaboration Centre (FSCC) early next year, in a bid to counter the growing threat to private sector institutions from cyber criminals, the Times has reported.
PayPal has announced new partnerships with American Express and Walmart, as its third quarter results reveal revenue growth of 14 per cent to $3.68 billion. The global payments platform’s statement also showed that 2.5 billion payment transactions were made during the three months to the end of September - up 27 per cent - while 9.1 million active accounts were added - up 15 per cent.
Société Générale (SocGen) is trialling a bank card with a fingerprint sensor, becoming the first French bank to experiment with biometric-enabled cards. It launched the technology following the successful roll out of a new generation card equipped with a dynamic card verification code to 400,000 clients, which the bank suggests is proof of growing appetite for additional card security features.
For FinTech to truly be transformative, a global regulatory approach which accepts the ‘new realities’ created by emerging solutions is needed. This is according to a new white paper from Deutsche Bank, which argues that the emergence of new technology relating to Open APIs, the cloud, blockchain and artificial intelligence (AI) has driven increasing volumes of digital data, new market players, business models and evolving client expectations.
Pay.UK, the retail payments authority formerly known as the New Payment System Operator (NPSO), has today published a procurement prospectus with the aim of finding a strategic partner to help deliver retail payment infrastructure. The publication marks the starting point of a competitive process to appoint an organisation to define, deliver and operate the New Payments Architecture (NPA), which will safely and securely process trillions of pounds worth of payments every year.
Blockchain will enter the mainstream as a leading supply chain technology in 2025, according to a new study by the Capgemini, which found that investment in the distributed ledger technology (DLT) is likely to grow by 30 per cent in the next three years.A survey of 450 financial services organisations worldwide found that far from taking the slow-start approach to the DLT, early adopters of blockchain are doubling down on their investments, with 60 per cent saying that blockchain has transformed the way they collaborate with partners.
NatWest has integrated with a new blockchain-based platform that aims to streamline the global syndicated loans market – worth over £3.5 trillion in loan deals last year. The Fusion LenderComm platform - due to go live in November - aims to revolutionise communication between lenders and agents using blockchain to ensure messages are secure and confidential.
All banks will have to adopt artificial intelligence (AI) within the next five years to keep up with the demands of the next generation of customers, according to a former Barclays wealth manager. Akshaya Bhargava, who today launched AI FinTech platform Bridgeweave, also told City AM that banks will need to deploy new technologies in order to meet the expectations of the Millennials who will soon take over from the Baby Boomer generation as part of the $30 trillion “great wealth transfer”.
BBVA has partnered with FinTech venture capital firm Anthemis Group to build a venture creation studio in London. This will deploy capital and resources to businesses that address untapped user needs and attract the best entrepreneurs.
Challenger bank Monese is launching an account for businesses across the UK and Europe. The banking and money transfer service, which prides itself on serving ‘globally connected’ customers, is today offering accounts for UK-registered businesses in 11 languages, and is expected to roll out the service in Europe in the coming months.
Visa is expanding its Token Service for credential-on-file (COF) token requestors, helping to increase security for consumer payments in digital channels. Acquirer gateway and technology partners Adyen, AsiaPay, Braintree, Checkout.com, Cherri Tech, CyberSource, Elavon, Ezidebit, eWAY, Fit-Pay, Giesecke & Devrient, PayPal, Payscout, Rambus, SafeCharge, SecureCo, Square, Stripe, Worldpay and YellowPepper will now be able to tokenise COF digital payments on behalf of their merchant and payment clients.
New research has shown that UK-based small to medium-sized enterprises (SMEs) encounter regular problems with digital services at the traditional banks they use and are considering moving to mobile-only challengers. A survey of over 450 SME owners by Unisys Corporation also found that Open Banking has the potential to shake up the market and facilitate innovative new propositions SMEs are looking for.
The New Payment System Operator (NPSO) has rebranded to become Pay.UK. The payments industry regulator stated that this new identity helps better promote its core purpose, transforming the UK’s payment infrastructure to enable a vibrant economy, as well as being a logical progression from consolidating the UK’s three retail payment schemes – Bacs, Faster Payments and the Cheque and Credit Clearing Company.
AXA Investment Managers has changed the names of its AXA Framlington Financial Fund to the AXA Framlington FinTech Fund, with a new focus on FinTech investment. The UK-domiciled fund will change on 20 November, with a new policy branching out from just traditional banks and insurers into companies providing technological applications throughout the financial services supply chain.
Up to one third of new revenue in the banking sector is being amassed by digital challengers, putting unprecedented pressure on established banks to compete for customer loyalty, according to Accenture. A study of more than 20,000 banking and payments institutions conducted by the consultancy revealed that the UK has seen the most profound disruption in overall market structure, with a 63 per cent rise in new players in 2017.
Standard Chartered and Huawei are developing an Internet of Things (IoT) powered solution that they claim could revolutionise the way corporations communicate with banks for financing or payments. Rather than companies having to manually initiate these transactions through paper-based or emailed instructions, businesses and banks systems will be able to ‘speak’ to each other in real-time, triggering financing or payment instructions through Application Programming Interfaces (APIs).
Coinbase has expanded its European presence with new Dublin office and is going on a hiring spree for various new business-related functions. The digital currency platform stated that its customer base in the European Union (EU) grew faster than any other market in 2017 - and continues to in 2018 - so it began looking for a new base in the region.
Fidelity Investments has become the latest asset manager to embrace the cryptocurrency trend by setting up a standalone company to support Bitcoin and Ethereum trading for hedge funds, endowments and family offices. The US-based spin-off, called Fidelity Digital Assets, will provide an enterprise-grade platform for executing trades in digital assets on a 24-7 basis, mirroring the blockchain’s ‘always on’ trading cycle.
Atos and Google Cloud have launched an artificial intelligence (AI) lab in London, aiming to bring together private and public sector expertise and organisational capabilities to collaborate and unlock cross-enterprise opportunities. The lab will be available to businesses and public sector organisations across Europe to utilise AI technologies, defining and designing use cases relevant to their needs.
A digital payments boom is being driven by developing markets, but the innovation landscape in payments is uncertain as BigTech entrants make their presence felt and incumbents face technical and regulatory complexity in developing collaborative payments ecosystems with FinTechs. This is according to the World Payments Report 2018 from Capgemini and BNP Paribas, which also found that it will take more than bank-led initiatives to grow the new payments landscape.
Berlin-based challenger bank Penta has raised €7 million in its latest funding round.
Penta, which offers bank account services to businesses, has grown rapidly since it launched in December last year.The latest raise by existing investors Inception Capital, brings Penta’s total fundraising to €10M.
UK cybersecurity firm Garrison, which has developed safe web browsing technology, has secured £30 million (£22.7 million) in its latest round of funding. The investment round, led by Dawn Capital, is the company's largest raise from wholly UK-based backers and will be used to accelerate development of national security grade technology for commercial use.
Nationwide is pumping £3million into a competition to encourage FinTech startups to develop Open Banking apps for consumers facing financial challenges.Launching today, the Open Banking for Good (OB4G) challenge is a government-backed scheme aimed at using Open Banking technology and financial data sharing between financial services companies to develop solutions for the one in four financially squeezed households in the UK - equivalent to 12.7 million people.
BABB, a blockchain-based FinTech targeted at ‘the unbanked’, has raised £1.4million in its latest funding round on Crowdcube.The startup, which is hoping to acquire banking licences in UK and Lithuania, raised the money to support its applications following donations from 1,232 investors.
Challenger bank CYBG has announced it has been given the green light from the Prudential Regulatory Authority to use its own risk modelling to establish the levels of capital it should hold.The regulator has granted the bank internal ratings-based (IRB) accreditation, meaning that it could opt to hold less capital as a result of new risk modelling requirements.
The financial services industry should brace for the emergence of a globally dominant digital challenger bank in the coming decade, experts have suggested. Speaking at a panel event at London’s PayExpo, Matt Ford, head of product at challenger bank Tandem suggested that the rapid adoption of digital and mobile banking, as well as the scalability of platforms across borders would usher in an era of digital ‘goliaths’ in the financial services sector which could prove just as disruptive as social media giant Facebook.
Metro Bank has gone live with Insights, its in-app money management tool which uses artificial intelligence (AI) to generate tips and alerts. Developed with Personetics, the opt-in tool applies predictive analytics to users’ spending patterns, which is then translated into tailored prompts.
Facebook is planning to extend its social messaging platforms WhatsApp and Facebook Messenger to become a leading channel of digital payments services, its Northern Europe finance chief has said. Laura McCraken, Facebook’s head of financial services and payments partnerships for Northern Europe told audiences at a panel event at London’s PayExpo that the social media giant is already seeing WhatsApp -which has 1.5 billion users worldwide- used for buying and sharing payment credentials, and explained that Facebook has already started rolling out digital wallet services in emerging markets such as the Philippines.
Digital challenger bank Tandem is launching a new credit card service as part of its plan to help users build a strong credit history. The bank, which regained its banking licence in January this year, has expanded its product offering rapidly to keep up with fellow digital-only players Monzo and Starling.
Mastercard has launched Bill Pay Exchange, a new digital solution to help consumers view, manage and pay bills without having to set up accounts with different billers or remember multiple passwords and dates for payments each month. Offered through banks and credit unions, the technology lets consumers use their mobile banking app to set up all billers, receive notifications when a bill is due, see bill details, and manage multiple bills in one place, including specifying when and how much to pay.
Payment service sharing among banks and FinTechs is a sector “ripe for disruption”, Starling Bank’s chief platform officer has said, as a panel of payments experts made their predictions for the year ahead. Speaking at the PayExpo in London yesterday, Megan Caywood noted that application programming interfaces (APIs) which allow banks and financial institutions to securely share data, are “fundamentally changing” the way that software is created and brought to market, with quick transmission of data allowing banks to access payments at lower cost.
The financial services sector needs a fresh regulatory and tax approach to deal with the challenges and opportunities presented by a rapidly changing technological landscape, according to a new report by the Confederation of British Industry (CBI). The report is a result of conversations with financial services firms across the UK, which states that while firms have welcomed the government’s support for FinTech developments such as the regulatory sandbox, they need regulations that are fit-for-purpose in a new technological age.
Lloyds Bank, Halifax and Bank of Scotland customers can now choose to use their voice to verify themselves when accessing their banking over the phone, following the launch of Voice ID by Lloyds Banking Group. Once a customer registers for the service, they will be asked for their card or account number and verified, then they will be asked to say ‘my voice is my password’ to create a unique voiceprint.
Starling is expanding its banking-as-a-service and payment services offer, bringing white label banking to the UK. Access to the digital challenger banks’ proprietary, cloud-based technology via Application Programming Interfaces (APIs) will allow companies to launch their own bank accounts and provide customers with payment services such as debit cards.
The Royal Bank of Scotland’s head of operations for digital propositions has claimed the company is “catching up” with digital banking challengers, but has been slowed by having to upgrade legacy systems. Speaking at the PayExpo conference in London yesterday afternoon, Benjamin Morgan praised digital-only entrants to the sector, stating they are “doing a good job”, especially from a customer satisfaction standpoint.
Passporting into the European Union can continue after Brexit, but one expert has warned that it will “become a lot more complicated”. Paul Anning, a partner in the financial institutions group at law firm Osbourne Clarke, told delegates at the PayExpo conference in London that companies must start considering exactly which European countries are most crucial to their business.
The Financial Conduct Authority’s (FCA) regulatory sandbox process has brought benefits but has highlighted various challenges for FinTech firms in testing their models, according to a study by Deloitte. The consultancy firm collaborated with Innovate Finance to survey a number of companies participating in the FCA’s sandbox, which allows business to try out innovative products, services and delivery method on real consumers in a regulatory ‘safe space’ before going to market.
New research has found that 83 per cent of European business decision makers expect blockchain to have an important or very important impact on their industry, but only two per cent of businesses are interested in collaborating with other firms for wider industry advancements as part of their blockchain strategy. Technology consultancy firm Cognizant surveyed over 1,500 senior executives across banking and financial services, manufacturing, retail, healthcare and insurance, finding that Europe is potentially quite conservative when assessing the significance of blockchain.
Schroders has taken a minority stake in Qwil Messenger, the first FinTech startup to have joined its global in-residence programme. The chat platform, which enables firms and clients to communicate directly through one app, joined the investment manager’s Cobalt programme earlier this year. This undisclosed investment formalises Schroders’ relationship with Qwil.
Starling is partnering with InsurTech startup So-sure to offer customers mobile insurance directly from their phones. In the latest third party-partnership to feature on its app-based marketplace, the digital challenger bank will enable customers to apply for an insurance policy in minutes.
The Competition and Markets Authority (CMA) has published the results of a study into pricing algorithms and whether they could be used to support illegal practices. Whilst there was little evidence of companies using algorithms to show personalised prices, it did find that they were sometimes used to change the order in which products are shown to shoppers.
Payment processing, machine learning and data solutions firms have fuelled a $40 billion boom in UK FinTech mergers and acquisitions (M&A) in the first half of 2018, according to a new report. A study of M&A activity in the sector by advisory firm Hampleton Partners recorded 141 transactions in the first six months of the year, with a total value of $39.3 billion - up 26 per cent on the previous half year.
The Luxembourg Commission de Surveillance du Secteur Financier (CSSF) and the Australian Securities and Investments Commission (ASIC) have signed a cooperation agreement for cooperation over financial innovation in each jurisdiction. The agreement provides a framework for information sharing between the two regulators on FinTech and RegTech, formalising the previously close relationship between the ASIC and the CSSF.
The differing approaches to data breaches of British Airways and Equifax have been cited as best practice and a cautionary tale, respectively, under the General Data Protection Regulation (GDPR). Speaking at the IP Expo conference in London yesterday, OneTrust’s vice president of sales and business development Kevin Kiley said that while Equifax drip fed information which it turned out had been known for months - while senior executives sold company stock - British Airways immediately contacted affected customers and went public with the breach.
Companies will see an upsurge in personal data requests under General Data Protection Regulation (GDPR) rules as high profile cyber security breaches become more commonplace, a data privacy expert has warned. Speaking at a panel discussion at London's IP Expo 2018, Kevin Kiley, vice president of sales and business development at OneTrust, said “I think we will see organisations struggle with data subject rights”.
A new report from PA Consulting has revealed that financial services firms expect to lose business and revenue if regulators do not embrace innovation and evolve with technology trends. The consultancy questioned 500 directors with responsibility for compliance and regulation issues in UK organisations, along with 2,002 consumers.
Pelican, the only mobile first, multi-broker network regulated by the Financial Conduct Authority (FCA), has announced its latest Seedrs funding round.Founded by ex-City brothers Peter and Mike Read after seven years of building financial exchange platforms for companies such as Gain Capital and LCG, the platform is designed to allow retail traders and investors to chat, share and compare live trades in customised social groups.
Companies should prepare for the inevitability of a cyberattack as criminals develop increasingly efficient ways to infiltrate networks, according to experts.Speaking at a panel discussion at London’s IP Expo 2018, Claire Albois-Galcoix, marketing director at Yubico, a password security provider, warned the audience that ransomware attacks such as the Wannacry outage in 2017 should now be considered part of the everyday threat landscape as criminals widen the scope and scale of their operations.
N26, a German digital bank which has 1.5 million customers across Europe, is launching its current account to UK customers today. The app-based bank, which was launched in Berlin in 2015, is backed by Tencent, the Chinese internet giant, Paypal co- founder Peter Thiel, and Hong Kong business magnate Li Ka-shing. It has raised £165 million in funding so far.
Digital technologies - namely the Internet of Things (IoT), artificial intelligence (AI), 3D printing and blockchain - will increase trade growth by up to 34 per cent by 2030 thanks to lower costs and higher productivity. However, they could also create a challenging environment for those seeking to keep up with the latest innovations, according to the 2018 edition of the World Trade Organisation’s flagship World Trade Report.
The current hype around artificial intelligence (AI) is getting to proportions where it risks overtaking common sense in terms of business decision-making, according to several experts. Speaking at the IP Expo 2018 conference yesterday afternoon, Sophos senior security advisor Paul Ducklin told the audience that senior executives should avoid “letting AI hype take over your common sense”.
The number of cyber security breaches to hit financial services firms trebled in the first eight months of 2018 compared to the previous two years, according to a new report. Bitglass, a cloud access security broker (CASB), analysed the incidence of security threats and breaches across the financial services sector worldwide and compared the results for 2016 and 2018.
Britain’s departure from the European Union should not unleash a “race to the bottom” in regulation, the chairman of the Financial Conduct Authority (FCA) has said. Speaking at a conference run by the Association for Financial Markets in Europe (AFME), Charles Randell warned against a move towards ‘light touch’ standards as the UK seeks to compete as a global financial centre after Brexit.
A majority of the UK’s chief information officers (CIOs) believe IT holds the key to improved customer experience, according to a new study which found that 45 per cent of purchasing managers plan to invest more in artificial intelligence (AI) and other new technologies in the coming year.A survey of 1,200 CIOs from the UK conducted by KPMG and management consultancy Harvey Nash found that 60 per cent of those asked said that management in their firm was looking to IT to boost customer experience and engagement, which was the priority for 62 per cent of those asked.
Dashly, the UK’s first ‘always-on’ mortgage switching platform, has launched today, claiming to have the potential to kill comparison sites. The LendTech startup gives consumers free, automatic alerts when it pays to switch to another mortgage, without having to manually update their mortgage data.
A group of 14 Italian banks working on a blockchain trial has successfully passed the first phase of technical procedural verification, with work now being done on a substantive test of the processes in the field. Two months’ worth of data - or 1.2 million movements - was uploaded to the infrastructure that corresponds to the banks working on the ‘Spunta Project’. A statement noted the performance was good, so the next test will involve participating banks working on a daily basis with the new application based on distributed databases.
Monzo is looking to reach 10 million customers and has long-term plans to expand internationally, according to one of its lead engineers.Matt Heath, who has helped design the challenger bank’s infrastructure since its launch in 2015, predicted that the lender’s rapid growth will far outstrip the one million current account customer mark it passed last month.
Despite UK families owning an average of five smart home devices, only 15 per cent utilise software or apps to protect the Internet of Things (IoT) devices in their home. A survey conducted by Open-Xchange in collaboration with Censuswide among 2,005 parents also found 17 per cent do not use any protection at all, while 67 per cent use anti-virus and anti-spam software to protect only their desktop devices from malware, adware and phishing tactics.
The insurance technology (InsurTech) sector is booming, but traditional insurers are increasingly concerned about the entrance of BigTechs into the sector , according to the inaugural edition of the World InsurTech Report from Capgemini and Efma. A combination of surveys and interviews with traditional insurance firms and InsurTech firms, covering over 140 executives across 33 markets, showed that the industry expects disruption and new competition to come from companies and manufacturers like Amazon, Facebook and Google in the US and Alibaba and Tencent in China.
The government of Canada has put together an advisory committee to investigate the possibility of introducing Open Banking. Minister of finance Bill Morneau announced the appointment of its four members: TD Bank technology head Colleen Johnston, Montréal-based entrepreneur François Lafortune, Dentons law firm partner Kirsten Thompson, and tech hub MaRS Discovery District chief executive Ilse Treurnicht.
The Financial Conduct Authority (FCA) has fined Tesco Bank £16.4 million for failings related to a massive cyber attack in 2016 which left customer data vulnerable. The financial watchdog issued the penalty to Tesco’s banking arm over its “foreseeable” failure to exercise “due skills, care and diligence” in protecting customers from the cyber-attack.
Softomotive, a robotics startup specialising in the automation of business processes has landed $25 million and will relocate to the UK as part of its global expansion strategy. The startup, which was founded in Athens in 2005, develops Robotic Process Automation (RPA) software to automate repetitive tasks.
HSBC has become the latest bank to apologise to customers after it was hit by a glitch in its online banking services early this morning. A spokesman for the bank said the issue had now been resolved and the mobile app was now operating “business as usual.”
TSB bank has again apologised after customers reported fresh disruption to their mobile app and internet banking services this morning.A spokesman for TSB said that the services were "recovering back to normal levels" this afternoon and advised customers to retry their apps and online banking if they have had issues. He added that cards, branch and telephone services continue to operate as normal.
Royal Bank of Scotland (RBS) is exploring the launch of a standalone digital bank which will operate under the brand name Bo.The lender’s plans for an app-based consumer bank to take on FinTech challengers like Monzo and Atom bank, as well as the proposed name, are understood to have been briefed to around 100 staff yesterday.
Alibaba, the Chinese eCommerce group, is partnering with Banking Circle to facilitate its digital payments around the globe. Reflecting Alibaba’s ambitions to grow the reach of its online marketplace and technology business, the tie up is intended to facilitate online cross-border payments, and is likely to see increased business activity in Europe.
New research has found that 42 per cent of people in the UK think the government should regulate artificial intelligence (AI) and 11 per cent consider the government responsible if something goes wrong with AI.London-headquartered law firm Bristows commissioned Censuswide to survey a representative sample of 2,103 people, finding that half do not trust AI with their personal data.
Openbank, the Santander Group's digital bank, has launched automated investment and micro-investing services. Customers are offered five risk alternatives with an estimated forecast of the profitability that they can achieve with each of them. The options consist of a diversified portfolio of up to 15 investment funds indexed to equities, fixed income, monetary assets, real assets and assets that are uncorrelated with the financial markets, such as property or infrastructure.
UK cybersecurity firm Darktrace, which uses AI technology to boost the cyber defence systems of airports, financial institutions and major corporates, has raised $50 million in Series 3 funding, valuing the company at $1.65 billion. The company has grown rapidly since it was founded by intelligence cyber operations experts and Cambridge mathematicians in 2014. Its Enterprise Immune System, an autonomous response technology branded Darktrace Antigena, uses AI-driven machine learning to identify and respond to in-progress cyber-threats in real time.
Stripe, the payments technology firm, has been valued at $20 billion after its latest funding round raised $245 million.The US FinTech rival of PayPal which was founded in 2010, announced that it would use the money, raised by Tiger Global along with DST Global and Sequoia, to fuel rapid expansion of the business and its engineering talent base internationally, particularly in Asian markets.
VoxSmart, a RegTech firm specialising in mobile communication is enabling staff at Singaporean energy and commodity firms to trade on WeChat and WhatsApp.The UK-based company, founded in 2006, launched the cloud-based mobile communications surveillance service built on their proprietary VSmart technology in Singapore two years ago.
Citi has launched a virtual account allowing institutional clients to segregate out their balances in a single physical account. The lender says the new Virtual Accounts use proprietary technology to offer corporate treasury clients enhanced visibility, control and efficiencies through centralised payments, receivables and liquidity management.
JPMorgan has expanded its Interbank Information Network (IIN) - the first live blockchain service offered by the firm - to more than 75 banks, the largest number of banks to join a live application of blockchain technology. “We’ve been actively exploring how emerging technologies such as blockchain, AI and an enhanced digital experience can be deployed in our treasury services business to better serve our clients’ ever changing needs,” said Takis Georgakopoulos, global head of treasury services. “We will lead the market with the rollout of a robust pipeline of innovations over the coming months, beginning with the launch of IIN.”
Deployments of real-time payment systems are surging worldwide, with 40 active real-time payment programs around the world, up from 25 in 2017 and nearly three times as many as were in FIS’ inaugural 2014 study. The financial services technology firm’s fifth annual report found five payments programs under development, with another 16 expected to be live in the next 12-18 months – double the number of programs on the radar in 2017.
Financial regulators have issued more than $26 billion of fines for non-compliance with sanctions, Anti-Money Laundering (AML) rules and Know Your Customer (KYC) in the past ten years, according to a new study which ranks the UK’s Financial Conduct Authority as the toughest regulator in Europe. A data study compiled for Fenergo, a client lifecycle services provider for financial institutions, found that the FCA accounted for the majority of fines issued by European regulators, which issued a collective $1.7 billion of penalties over the past decade.
Concirrus, an EY-backed InsurTech startup supplying the marine and motor analytics market, has landed £5million in investment, taking its total funding to £12million so far.
The London-based startup founded in 2012, counts brokers, insurers, major fleets and reinsurers among its clients. In April this year it announced a global agreement with EY, the financial services and consultancy firm, which will sees the two working together to drive adoption of Concirrus’ technology in the market.
Banks that commit quickest to Open Banking practices will win the most market share, according to a panel of experts. MIT Technology Review Insights, in association with Oracle Financial Services, interviewed senior executives directly involved with Open Banking from institutions including Citi, HSBC, ANZ, Standard Chartered Bank, BBVA and Sumitomo Mitsui Financial Group.
Apple and Salesforce have announced a broad strategic partnership aimed at growing software as a service (SaaS) offerings to businesses. The alliance, announced ahead of customer relationship management (CRM) platform Salesforce’s annual Dreamforce developer conference in San Francisco today, comes as consumer technology company Apple looks to expand its enterprise strategy and access more corporate sales through online apps.
A total of £503.4 million was stolen by criminals through authorised and unauthorised fraud in the first six months of 2018, according to data from UK Finance. During the same period, the finance industry prevented £705.7 million of unauthorised fraud, equivalent to £2 in every £3 of attempted unauthorised fraud.
Tesco Bank could reportedly be facing a record £30 million fine from the Financial Conduct Authority (FCA) over an attempted hack in which criminals tried to siphon money from customer accounts.Sky News reported that the regulator is weighing up whether to impose the largest ever fine for a cyber attack-related incident on Tesco’s banking arm, over the attempted hack in November 2016 which forced the lender to suspend all online transactions.
Barclays has launched a digital platform for its corporate banking division in Western Europe to support multi-country banking.The new platform will enable international and institutional clients of Barclays based in Portugal, Spain, France and Ireland to access new digital corporate banking services, with Germany lined up to join next year before expanding to other European countries.
Initial details of a new procurement process for the clearing and settlement layer that will form the backbone of the New Payments Architecture (NPA) have been announced by the New Payment System Operator (NPSO). The NPA is a new conceptual model for payments in the UK, which will take over the processing of more than £6.7 trillion of Bacs, Faster Payments and potentially cheque payments every year, from 2021. Bringing them together will simplify the rules, standards and processes that banks and others need to follow to use the systems.
Santander has announced that Emma Leith is to join the bank’s UK operations as chief information security officer. Leith will join the bank with immediate effect, following a spell as director of cyber strategy and programmes at Barclays International. She previously held the chief information security officer role in corporate functions and commodity trading divisions at BP Oil International for seven years.
Revolut’s annual report has revealed £14.8 million worth of total losses after tax during 2017, as operational costs rose 52 per cent from the previous year. These were largely attributed to costs associated with its card scheme, acquiring and user acquisition, as the mobile-only bank’s app trebled its customer base from 450,000 to 1.3 million. The report also detailed plans for how the FinTech will deal with Brexit, with applications being made for e-money licences in Luxembourg, in addition to a previous application for a full banking licence in Lithuania.
Modulr, a FinTech startup offering digital payments accounts for businesses, has announced plans to open a new office in Edinburgh following its latest investment round. The London-based startup, founded in 2016, is to use the funding to create more than 30 new jobs and grow its software engineering, customer support, risk and compliance and finance teams as it seeks to take advantage of the burgeoning FinTech scene in Scotland’s capital.
A total of 71 InsurTech funding transactions during the second quarter of 2018 marks a record high, although the total of $579 million invested is down 20 per cent against the previous quarter, according to Willis Towers Watson. The consultancy firm’s latest industry report found that the second quarter also set a new record for the volume of incumbent participation in InsurTech investments.
The Royal Bank of Scotland (RBS), FWB Park Brown, Dell Technologies and the Times Scotland have partnered to launch a competition to identify and support the next generation of financial technology pioneers in Scotland. With a prize fund totalling £125,000 on offer, the project aims to encourage and reward world-class ideas in FinTech innovation.
Cleo, a FinTech offering a money management app for Millennials, has landed $10 million in a Series A funding round. The investment round was led by Balderton Capital, which backed Nutmeg and Revolut, and will form part of Cleo’s plans to launch their own range of financial products.
Online banking services across Royal Bank of Scotland Group - including RBS, NatWest and Ulster Banks - went down this morning, with millions of customers unable to access their accounts via online and mobile apps.The group said the issue has now been "resolved" across its network of retail banks.
In addition to traditional challenges, retail banks globally are now facing new forms of competition: the Open Banking ecosystem, emerging technologies and soaring customer expectations. This is according to the 2018 World Retail Banking Report from Capgemini and Efma, which surveyed more than 10,000 retail banking customers in 20 countries.
ING Ventures, a £300 million fund set up by the Dutch banking group, has invested £6.7 million in Cobase, an Open Banking platform which will expand its client network and develop functions such as a robo-assistant to monitor transactions. Cloud-based solution Cobase, which is an arms-length venture of ING Bank, allows users to view balances and transactions from several bank accounts in one place, initiate payments and use cash management services on a single platform.
UK financial services firms expect their use of web chat to grow from 24 per cent today to 89 per cent by the beginning of 2020, according to new research. A survey of over 200 UK contact centres by ContactBabel found that the use of interaction analytics is expected to rise from 33 per cent to 77 per cent in the next two years, while automated speech recognition is expected to increase from 17 per cent to 52 per cent over the same timescale. Much of the latter is being used to reduce fraud and the time required to take phone customers through security.
Equifax has been fined £500,000 by the Information Commissioner’s Office (ICO) after the data of 15 million Britons was left exposed by a massive cyberattack. The data breach occurred between 13 May and 30 July 2017 and affected information belonging to 146 million people worldwide.
Banks and trading firms are to launch the world’s first blockchain platform for commodities trading.The new platform developed by Komgo SA, a Genava-based company, is backed by 15 major investment partners and is expected to launch before the end of 2018.
Spending on RegTech platforms will exceed $115 billion by 2023, up from an estimated $18 billion in 2018. Analysis from Juniper Research found that increased regulatory pressures, as demonstrated by the recent General Data Protection Regulation (GDPR) implementation, are driving businesses towards regulatory technology solutions to meet greater compliance challenges.
Abu Dhabi Global Market (ADGM) has launched a FinTech digital sandbox, allowing financial institutions and FinTechs to experiment on products and solutions in a digital platform environment, supported by regulatory standards developed by the United Arab Emirates’ Financial Services Regulatory Authority (FSRA). The sandbox will let participants source and procure FinTech solutions locally and globally, adopt and orchestrate the best ones that meet their business needs, and tap cross-border market access to grow and scale their business.
RBS is reportedly in the early stages of trialling two standalone digital banks under the NatWest brand as part of plans for a potential line of online-only products. The bank is testing a new business banking platform as well as a separate digital retail bank, the Press Association reported, citing a senior source.
A report from the Treasury Select Committee has urged regulation needed for the ‘Wild West’ crypto-asset market, to tackle problems including volatile prices, hacking vulnerabilities, minimal consumer protection and anonymity aiding money laundering. Crypto-assets, and most Initial Coin Offerings (ICO), are currently not within the scope of Financial Conduct Authority (FCA) regulation, read a statement. Crypto-asset investors are therefore currently afforded very little protection – namely there are no formal mechanisms for consumer redress, or compensation.
Revolut’s head of business development has revealed that as its budget won’t stretch to marketing to older demographics, the mobile-only bank is relying on sons and daughters to educate and convert their parents. As part of a panel at UK Finance’s Digital Innovation Summit yesterday afternoon, Andrius Biceika admitted that the challenger bank still had a way to go before it is regarded as customers’ main banking service.
Santander has announced plans to build a £150million tech hub in Milton Keynes. The bank said its investment in a new office campus would serve as its flagship UK technology centre for the UK’s most innovative industries, and would bolster the government’s plans for a “growth corridor” between Cambridge, Milton Keynes and Oxford.
Academics investigating the impact of automation have found that augmented workplaces are deemed to be ‘more human’ than the traditional office environment. The study by Goldsmiths, University of London showed that companies investing in augmented workplace technology such as Robotic Process Automation (RPA) and artificial intelligence (AI) scored 33 per cent higher on factors deemed to make a workplace feel more human.
Nearly one third of cybersecurity breaches in UK financial services firms go undetected for longer than a week, according to new research from Accenture. The consulting firm surveyed more than 800 enterprise security practitioners, including 75 from the UK, and found that financial services firms successfully stopped 81 per cent of cyber attack attempts in 2017, up from 66 per cent in 2016.
Setoo has closed an €8 million Series A funding round - bringing the total amount raised to date to €10.3 million - with AXA’s InsurTech startup studio Kamet being the main investor in this seed round. The insurance-as-a-service company helps e-businesses create and sell protection tailored to consumer needs. Setoo quickly and easily builds and integrates products that are automatically embedded into the customer journey, with one-click underwriting directly on digital assets and personalised protection with automatic compensation.
NatWest and G4S are working together to pilot the UK’s first intelligent cash management solution for businesses later this year. Business will get access to automated account crediting of cash transactions without having to deposit that day’s takings in their local branch.
Yolt has become the first third-party provider to complete Application Programming Interface (API) connections under the new Open Banking regulation with nine of the UK’s biggest High Street banks. Combined with challenger banks Monzo and Starling, there are now 18 banks connected through APIs, with users granted access to a total of 35 different banks and cards. Currently performing around 1.5 million calls every week to Open Banking APIs, Yolt’s is the biggest user of these interfaces.
LendInvest has raised £30.5 million in its latest funding round, which was aimed at preparing the startup for a potential IPO. The online platform for property financing and investment has become one of the UK’s largest non-bank mortgage lenders since its launch in 2013. It lends finance to professional property investors and developers, allowing individuals and financial institutions to invest in the loans.
Legal requests for businesses to hand over internal data to the Serious Fraud Office (SFO) have more than doubled in the past five years. Law firm Pinsent Masons says 1,032 ‘Section 2’ notices have been issued by the SFO in 2017-18 without the government agency needing to seek approval for the orders through the courts. This number is up more than 123 per cent on the 463 notices issued in 2013-2014.
MortgageGym has announced the successful completion of a funding round of £3.8 million from investors, including LSL Property Services, which is the parent company of the UK’s second largest mortgage network. The GoCompare Group has also increased its shareholding as part of this investment round. Following the LSL investment, MortgageGym is valued at £12 million despite only having fully launched its proposition earlier this year. The funding will enable ongoing investment in the company’s development of mortgage robo-advice and artificial intelligence services.
Legal & General has announced a new strategic partnership with GrowthEnabler, the platform which delivers data and intelligence on disruptive technologies and digital innovations. The partnership is part of L&G’s strategy to drive digital innovation and transformation across the business. Founded in 2015 by Aftab Malhotra and Rajeev Banduni, GrowthEnabler identifies the most innovative and valuable startups and digital solutions for corporates to engage with – via acquisition, joint venture or other forms of commercial partnership. Opportunities are identified and managed via the company’s insights platform - the Personalised Intelligence Interface, Pii - and team collaboration tools.
Auditing firm KPMG is expanding its digital risk management offering with the acquisition of a minority stake in AdviceRobo, a Dutch LendTech startup. AdviceRobo is developing a technology that predicts financial risk associated with people and companies who want to take out loans and applies artificial intelligence (AI) analysis on non-financial data including the behavioural patterns of potential borrowers.
The US Commodity Futures Trading Commission (CFTC) and the Monetary Authority of Singapore (MAS) have signed an arrangement to foster greater cooperation in FinTech. This supports both authorities’ efforts to facilitate FinTech development and innovation in their respective markets and is the CFTC’s second FinTech cooperation arrangement with a non-US authority.
Financial services companies are turning to FinTechs for help developing their payments technology, according to research into digital transformation across the industry. A report by law firm DLA Piper, based on a survey of 270 international financial services companies, revealed that 61 per cent of businesses plan to collaborate with FinTechs to improve their services officering, with 41 per cent viewing payments technology as the primary area for investment.
Nationwide has pledged to invest a total of £4.1 billion in technology transformation over next five years, including the re-platforming of digital assets. The building society is looking to create up to 1,000 new jobs and open a new UK technology hub, with a strategy focused on driving UK service leadership through digitisation and multi-channel technology integration across the High Street and mobile channels.
A group of cryptocurrency and blockchain startups and investors have formed the Blockchain Association, a lobbying group to amplify their influence in US politics. The trade association’s initial members include San Francisco-based Coinbase and Boston-based Circle Internet Financial, two of the biggest digital currency exchanges. Blockchain-focused investment firms Digital Currency Group and Polychain Capital have also joined.
A new report from the Association for Financial Markets in Europe (AFME) and PwC has found that 95 per cent of survey respondents identified the opportunity for cost reduction as the most important driver for the adoption of technology, but only 28 per cent felt that their current investment allocated to this strategic change was sufficient. Examining technology innovation in Europe’s capital markets, the research revealed that 90 per cent believed the impact of new technologies on the workforce will lead to business and IT skills merging and future roles becoming more relationship focused. It suggested competition for future skills will be high, requiring banks to both invest in re-skilling the existing workforce and driving cultural change to attract new talent.
More than seven out of 10 people say they feel devices such as smartphones and tablets have become far too complicated over the past five years, with users admitting they neglect basic IT security as a result. Lifeline IT surveyed 1,000 consumers, finding that three quarters failed to regularly back-up their laptop or computer because it is too complicated. Only four out of 10 feel confident their entire digital life is securely backed-up and a further 64 per cent say they do not trust cloud storage.
The Payment Systems Regulator (PSR) has responded to a LINK report today showing a continued fall in the number of free-to-use ATMs, expressing concern over the trend. The first of cash machine network LINK’s ‘Footprint’ reports revealed that between the end of January and the start of July this year, the number of free-to-use ATMs reduced from 54,500 to 53,200 – a two per cent reduction in the size of the 1,300 ATM-strong network.
Barclays has claimed to be the first UK bank to enable customers to view their current accounts from several other UK banks within its mobile banking app. Customers who have a personal or business current account with Lloyds, Halifax, Bank of Scotland, RBS, NatWest, Nationwide or Santander can choose to view their balances and transactions when they log into the Barclays Mobile Banking app.
BMW Financial Services has partnered with Wrisk in a deal that will see the InsurTech startup become the sole supplier of BMW and MINI car insurance. It follows Wrisk’s time in the first BMW Innovation Lab last year, which saw the team win on the final pitch day after developing the platform now being used.
The uptake of mobile and online banking led to widespread decline in the number of bank branches across the EU in 2017, according to new figures from the European Banking Federation (EBF). The EBF’S annual update on the banking sector in Europe shows another consecutive year of contraction in banks’ physical presence across the bloc last year, with reductions both in staff numbers and branches as the industry took steps to boost efficiency and profitability.
The Financial Industry Regulatory Authority (FINRA) has released a white paper outlining the potential opportunities and implications that developments within regulatory technology (RegTech) may have for broker-dealers. The US regulator of brokerage firms conducted an in-depth review on the emergence of RegTech tools within the securities industry, highlighting five areas where industry participants have most prominently leveraged RegTech innovations: surveillance and monitoring, customer identification and anti-money laundering compliance, regulatory intelligence, risk management and investor risk assessment.
The Financial Conduct Authority’s chairman has warned of the potential for new technologies to create new risks in financial markets, as he addressed the regulator’s approach to FinTech and RegTech. Speaking at the launch of the regulator’s annual report this morning, Charles Randell stated that innovation in areas like big data and machine learning are a test of the FCA’s abilities to adapt.
Paxos, a US-based blockchain startup, has been approved by New York regulators to launch a ‘stablecoin’ currency pegged to the US dollar. The firm claims the Paxos Standard, which will be pegged to the dollar on a 1:1 basis, is the world’s first regulated crypto asset. It added that the dollar pegging will reduce the volatility seen by other cryptocurrencies and digital assets.
Ravelin has announced an £8 million Series B fundraising round led by BlackFin Capital Partners to expand its overseas business and extend its market reach. Existing investors including Amadeus Capital Partners, Passion Capital, and Playfair Capital also participated in the round.
Wagestream has landed the backing of major tech investors including Bill Gates, the founder of Microsoft, and Jeff Bezos, chief executive of Amazon. The payroll finance app, which hopes to help firms end the payday poverty cycle by allowing employees to access their wages before payday, has raised £4.5 million in its latest funding round.
Residential rent-to-own specialist Unmortgage has raised £10 million to help scale the business. The UK-based LendTech startup saw investment from Augmentum Fintech - which put in £2.5 million - alongside existing investor Exponential Ventures, and others.
TSB is planning to bring forward the publication of a report into its botched IT migration to the end of the year.The embattled retail bank, which last week saw its chief executive Paul Pester stand down following a series of IT failures, has asked law firm Slaughter & May to split a report they are compiling into two parts in order to fast track the process.
The Open Banking Implementation Entity (OBIE) has published the third version of its Open Banking Standards, building on those launched in March. The latest update effectively gives account providers who implement them in full, a solution that complies with the EU’s second Payment Services Directive (PSD2).
Lloyd’s Lab, the global insurance market’s new innovation accelerator, opened its doors this week following a search for technology talent that drew more than 200 applications from 36 countries. Start-ups, entrepreneurs and businesses from as far afield as the US, Canada, Israel, the Netherlands, Ireland and the UK, presented ideas ranging from live-streaming drones for fast risk and disaster assessment, to harnessing the Internet of Things for live cargo tracking.
Acorn Oaknorth, a London-based FinTech lender, has secured $100 million in funding in a deal that values the company at $2.3 billion. Oaknorth, the groups’ UK lending arm, will have a loan book of $2.8 billion by the end of the year and has lent more than $ 1.7 billion of new capital to more than 300 UK businesses since it secured a banking licence in 2015.
Citigroup has reportedly set up a unit to invest in FinTech startups and get a foothold in innovations in debt markets. The new venture - operating in the US banking giant’s credit markets, municipal securities and securitised-markets groups - will invest in firms developing new trading infrastructure technology, data analysis, machine learning and artificial intelligence.
Clear standardisation is crucial to unlocking the opportunities of the second Payment Services Directive (PSD2) and Open Banking, according to Deutsche Bank.In a white paper published yesterday, the investment bank warned that in order for banks, corporates and FinTechs to make a success of Open Banking, there is a need for standardisation of application programming interfaces (APIs), which are likely to underpin such systems.
British Airways (BA) is investigating the theft of personal and financial data of 380,000 customers after hackers gained access to its website and mobile app. The airline is urging customers who believe they may have been affected by the data breach to contact their bank or credit card provider, after revealing that its systems were compromised by a sophisticated hacking operation between 21 August and 5 September.
The Financial Conduct Authority’s chief executive has used regulatory sandboxes as an example of the importance of global cooperation between supervisory bodies, stressing that “the topic of multilateralism is so fundamentally important right now”. Speaking at the Eurofi Financial Forum this afternoon, Andrew Bailey said that in terms of financial innovation, there is no constraint on any domestic choice on the model of sandbox or what is accepted into them.
InsurTech start-up Homelyfe has teamed up with money management platform Yolt to offer integrated home insurance services via mobile app. Under the new partnership, users of Yolt, a FinTech venture backed by ING Bank, will be able to source a home insurance quote in 60 seconds.
Payment Service Providers (PSPs) and billers have being invited to register and play their part in developing ‘Request to Pay’ – a new way to improve the control, flexibility and transparency of bill payments. The portal has been launched by the New Payment System Operator (NPSO), which is responsible for setting the standards and rules in retail payments. The Request to Pay service is an innovation which will be ready for the market to competitively launch from next year.
Mobile-only challenger bank Monese has secured $60 million in capital as part of a Series B funding round. The investment, which will be used for product development and international expansion, brings the total funding since launch to $76 million. This new funding round was led by Kinnevik, with participation from PayPal, Augmentum Fintech, and International Airlines Group for its loyalty and data business Avios Group. Existing investors, including Investec’s INVC Fund, also participated.
Lloyds Banking Group is to shed nearly 400 jobs as part of company-wide plans to boost the bank’s online and mobile services. The shake-up, which forms part of a three year plan to equip the bank for an increasingly competitive digital market, will also see 435 new roles created in the bank’s transformation division.
Goldman Sachs is reportedly ditching plans to open a trading desk for cryptocurrencies due to uncertainty over the regulatory framework surrounding cryptocurrencies. Executives at the US investment bank have concluded that many steps are still yet to be taken by governments and regulatory authorities before a regulated bank would be allowed to trade cryptocurrencies, according to the Business Insider website, citing sources familiar with the matter.
A glitch in terminals run by Cardnet, a joint venture by Lloyds Bank and First Data, resulted in thousands of shoppers being charged twice for debit card payments. The operating error in Cardnet terminals occurred on 29 August, leading to duplicate transactions coming out of customer bank accounts but transactions showing up only once on shop, pub and restaurant receipts.
JaJa Finance, a London-based FinTech startup, is gearing up to launch a mobile-first credit card after securing £7 million in funding.The FinTech uses chat-based onboarding and offers users of its app the chance to manage their credit card through their mobile. Other features include instant credit issuing, tagging and search of transactions, and the ability to share credit limits with trusted family and friends.
Reinsurance giant Munich Re has agreed to buy Relayr, a German Internet of Things (IoT) startup for industrial machinery, in a deal that values the company at $300 million. Berlin-based Relayr uses enterprise middleware and IoT solutions to enable industrial companies to extract data from their machinery and speed up digital transformation.
Work and pensions secretary Esther McVey has finally backed the industry to deliver the long-awaited pensions dashboard. The dashboard should allow people to view all their pension pots in one place, from State Pension entitlements to company defined contribution and defined benefit schemes.
Starling bank has teamed up with InsurTech firm Anorak to offer life insurance services to users of its mobile banking app. Anorak, a life insurance advice service which uses APIs and machine learning to risk profile customers, has joined a growing pool of financial services accessible through Starling bank’s app-based marketplace.
Paul Pester, the chief executive of crisis-hit TSB bank, is stepping down with immediate effect as the company continues to battle IT failures which began in April. Pester, who has led the challenger bank for seven years, has been heavily criticised for his role in a botched IT migration that left thousands of customers without access to online banking.
The number of smartphone users relying on software-only biometric security could grow by more than 250 per cent over the next five years, according to new analysis. A new report from Juniper Research predicts that the biggest shift in mobile payment security will be the move towards software-based methods, which rely on standard smartphone components.
Funding Circle, a digital platform for small business lending, is gearing up to launch an IPO which could see the business valued at £2 billion.The fast-growing FinTech, which launched in 2010, connects SMEs looking for finance directly with investors seeking returns. The plans for a £300 million floatation on the London Stock Exchange this autumn were confirmed in a registration document filed this morning. Funding Circle plans to offer 25 per cent of its shares.
HSBC has reportedly hired one hundred new employees to work on a digital initiative to boost its small business banking operations and face down competition from FinTech challengers. ‘Project Iceberg’, based in the bank’s Aldwych offices, is a sign that the bank has opted to improve on its existing structures to build its digital bank, rather than follow rival incumbents in developing standalone digital operations, according to City AM, which spoke to sources close to the project.
Zurich Insurance Group has launched the Zurich Innovation World Championship, a global competition to collaborate with the brightest and best InsurTech start-ups and entrepreneurs. The competition focuses on start-ups with established products or services, and will provide the winners with the opportunity to apply their solutions to Zurich’s customers in selected countries.
TSB has suffered yet another IT meltdown, with customers unable to use its internet banking, mobile phone app and telephone self-service. The challenger bank, which was left reeling by a major IT collapse in April this year, released a statement on Twitter this morning apologising to customers for ongoing issues throughout the weekend following a session of planned maintenance work on Friday evening.
Google and Mastercard have reportedly struck a secret deal to allow merchants to track when online ads have led to sales at bricks and mortar stores. Google’s parent company, Alphabet Inc and Mastercard brokered the partnership during protracted negotiations lasting about four years, according to sources cited by Bloomberg.
Pagaya Investments, a US-Israeli FinTech that uses machine learning and big data analytics to manage institutional money, has raised $14 million in a private funding round. The round was led by venture capital fund Oak HC/FT and Harvey Golub, the former chairman and chief executive of American Express, who will join Pagaya's board.
Ebury has become the first FinTech to go live with SWIFT’s global payments innovation (gpi). The UK-based firm got on board to help its clients fast-track their international payments. Half of gpi payments are credited within 30 minutes, many within seconds – and almost 100 per cent within 24 hours.
Complaints to the Information Commissioner’s Office (ICO) about potential data breaches have more than doubled since the General Data Protection Regulation (GDPR) came into effect. Information released under a Freedom of Information Request from law firm EMW showed that there were 6,281 complaints between 25 May, when GDPR came into force, and 3 July, a 160 per cent rise from just 2,417 complaints over the same period in 2017.
Teenagers will be able to make payments through wearable health tech devices as part of a new current account offering from Starling Bank. The digital-only bank has launched a current account for 16 and 17 year-olds offering a range of tech-driven payment options including FitBit Pay and Garmin Pay, in addition to the contactless payments through Apple Pay, Samsung Pay and Google Pay.
Lendstar, a German social finance app enabling peer to peer payments and lending, has announced it is filing for bankruptcy. The Munich-based FinTech, founded in 2012, allowed friends to chat, pay, split bills and lend money for free on a secure mobile app.
Banks, FinTechs and telecom firms are reportedly considering bids to join the first generation of virtual banks in Hong Kong, as the territory’s regulator prepares to issue its first online-only banking licences. Companies considering a potential bid to the Hong Kong Monetary Authority (HKMA) are said to include Ant Financial, the FinTech affiliate of Chinese retail giant Alibaba, Chinese investment group Tencent, and Ping An Insurance, a Chinese holding conglomerate, according to sources who spoke to Reuters.
Salary Finance, a financial fitness app that helps employees to save, has raised $20million in Series B funding led by Bleinheim Chalcot and Legal & General to launch in the US and support growth in the UK. The UK-based FinTech, launched in 2015, partners with employers to help staff switch from debt into saving through loans and financial support facilitated by salary deduction schemes.
UBS has closed its SmartWealth digital financial advice platform and is selling off the technology to US automated advice firm SigFig. A message on the website says that the service, which only launched in March 2017, is closed to new customers.
JPMorgan is set to appoint former Google executive Apoorv Saxena this week as its new head of artificial intelligence (AI) and machine learning services. Based in Palo Alto, California, he will report to John Fathers, head of big data and pattern ownership, Saxena will also serve as the head of asset and wealth management AI technology.
Royal Bank of Scotland has joined up with challenger bank Starling to help it with plans for a standalone digital bank. According to a shareholder letter sent by Anne Boden, chief executive of Starling, which was detailed in the Sunday Times newspaper and confirmed to FStech, Starling has signed “a contract to provide payment services to support new initiatives at RBS/NatWest”.
Apperio, a legal tech start-up offering analytical technology to FTS100 companies, has raised $10 million in a Series A funding led by Revolut backer Draper Esprit.The automated, cloud-based technology, which enables clients including Just Eat and Network Rail to track and run analytics on legal spend in real-time, has seen revenues grow by 300 per cent in the past 12 months and has grown its team to 20 people.
A UK FinTech delegation has joined prime minister Theresa May on her first official trip to Africa, hoping to establish trade and export links while visiting emerging markets South Africa, Nigeria and Kenya. Representatives from the Financial Conduct Authority, London Stock Exchange Group, Standard Chartered, Azimo and Farm.ink were among the 29 leaders on the trip.
Traditional retail banks are lagging behind digital-only challengers, with only two per cent seeing themselves as drivers of innovation, according to Roland Berger research. The consultancy firm’s European Retail Banking Survey took in 60 senior staff members at banks of various sizes across 10 different countries. It found that when they were asked to state who was driving the establishment of banking platforms, banks came only fourth (44 per cent) after the tech giants (80 per cent), digital challenger banks (68 per cent) and FinTechs (65 per cent).
More than three quarters of millennials would prefer to leave their wallet rather than their mobile phone when leaving the house, suggesting rapidly changing attitudes to payment methods amongst younger generations.In a survey of 200 UK consumers conducted by Compass Plus, a payment software provider, millennials were given the choice between leaving the house with their mobile phone or their wallet, with 77 per cent opting for their phone.
Post-purchase customer engagement platform Narvar has announced a $30 million Series C financing round led by Accel, which also led Narvar’s Series A round. Existing investors including Battery Ventures participated in the round, as well as new investors Salesforce Ventures and Scale Venture Partners. In conjunction with the financing, Accel partner Ryan Sweeney will join Narvar’s board.
Citi is partnering with Spotify to enable customers in Asia to pay for the music streaming service with their credit card points. In the first link up of its kind, US-based bank is offering customers of its Pay and Points capabilities to sign up for the ad-free Spotify Premium service and pay with points amassed on card payments.
TSB is to postpone its shift to Mastercard to process its card payments in order to focus on restoring its computer system back to strength following an IT collapse in April.The High Street lender had announced plans to migrate to Mastercard from Visa Europe for its card operations by December this year, but the changeover has now been delayed until at least 2019.
Deutsche Bank has extended its FinTech portfolio through the acquisition of a minority stake ModoPayments.The equity taken in the US paytech firm will enable the investment bank to expand its transaction banking franchise and improve its existing digital B2B and B2C payment services.
Disruptive technology could lead to the loss of 50 per cent of banking jobs within the next decade, according to former Barclays chief executive Anthony Jenkins. More than half of Britain’s 7,000 bank branches are at risk of closure, said the former bank boss, with rapid advances in automation leading to swingeing job losses.
Electronic money and payment institutions from the European Economic Area (EEA) will be able to continue passporting into the UK for three years under government plans for a no-deal Brexit. In a paper published yesterday - one of 25 technical notices of a total of 80 due to be released in the coming month - the government set out plans for dealing with the consequences for financial services and cross border contractual arrangements if the UK exits the EU without a negotiated deal on 29 March 2019.
The shortlisted entries for this year’s Payments Awards have been officially announced. Now in their 6th year, the awards recognise card and payments excellence and innovation. Winning entries will come from those companies, individuals and organisations who have launched and/or implemented the most outstanding payments solutions, initiatives and projects during the past year.
Vestigo Ventures, an early-stage venture capital firm focused on FinTech, has successfully closed its Vestigo Ventures Fund I with $58.9 million. Founded by David Blundin, chairman of Cogo Labs; Mark Casady, chairman of LPL Financial; and managing director Ian Sheridan, the firm focuses on companies that are applying technology - blockchain, artificial intelligence and big data - to improve market structures, provide operational solutions, enhance worksite management and support personal wealth strategies.
Goldman Sachs is rolling out new digital consumer savings platform, Marcus, to its UK staff ahead of a public launch in the coming weeks, according to an internal staff memo seen by FStech.The US investment bank’s ‘easy access’ online savings account was launched in the US in 2016, and will be offered to bank staff initially to gather feedback on its functionalities before it goes to market.
The government has warned that in the event of a no-deal Brexit, consumers would face slower and more costly credit card payments when they buy European Union products, while British citizens living abroad could lose access to their bank accounts altogether. The details come as part of 25 technical notices - the first of 80 due in the coming weeks - published in Westminster today, which explain how companies and the public should prepare for a deal or no-deal exit from the EU.
Financial advisory firm deVere is bolstering its FinTech offering with the launch of a new investment app. Available for Apple and Android, the app will offer its client base - largely made up of expatriates and international investors - a platform to monitor investments in real time, keep up to date with news that could impact returns and access to a chat system or direct line to an advisor.
Monzo is reportedly planning to launch a record £20 million crowdfunding round as it eyes up a coveted $1billion valuation from new investors. The digital challenger bank is said to be mulling the equity crowdfunding drive, which would see existing customers offered the chance to participate in the UK’s largest crowdfunding round to date via its mobile app, City AM reported.
Younger generational groups, in particular Millennials, are significantly more open to receiving automated financial advice and investment management than their elder counterparts. Crealogix commissioned a survey of 1,200 consumers aged 16 and above at the end of July, finding that more than 60 per cent of those aged between 30 and 37 stated they would be receptive to an automated financial service, rising to almost 70 per cent of those aged between 22 and 29.
The majority of UK chief executives are frustrated by short termism and the pressure from their board to deliver results on multi-year digital transformation projects. This is according to new research from KPMG, which surveyed 150 chief executives in the UK. It found that 72 per cent feel there are unreasonable expectations for return on investment with regards to digital transformation projects.
Revolut has launched a metal card that will give customers up to one per cent cashback in either fiat or cryptocurrency, withdraw up to £600 per month free from international ATMs and offer a dedicated concierge service for booking everything from flights to festival tickets. Revolut Metal customers will also get unlimited foreign exchange, free international money transfers, 24/7 priority customer support and overseas travel insurance covering areas including health, dental, flight and luggage delays.
Aviva has partnered with Amazon to enable customers to find out how much they have saved in their pension fund through a conversation with AI bot Alexa. Customers registered on MyAviva are now able to link their account with Alexa, asking the voice assistant to tell them the value of their pension pot. Aviva Canada have also developed a skill which allows consumers to ask Alexa for a motor insurance quote.
Artificial Intelligence (AI) and flying cars are among this year’s top technology trends, according to a new study, which also revealed that the hype around blockchain is cooling as its enters mainstream use. The annual trends survey conducted by research firm Gartner, which tracks where tech trends are on the ‘hype cycle’ in their journey from next big thing to mainstream usage has determined that distributed ledger technology (DLT) and driverless technology have passed the peak ‘hype’ phase of inflated expectations.
Aberdeen Standard Investments has launched a new fund that utilises machine learning to identify sources of potential returns. The Aberdeen Global Artificial Intelligence Global Equity fund is the product of a collaboration between Aberdeen Standard Investments’ Quantitative Investment Strategies (QIS) team and the Mitsubishi UFJ Trust Investment Technology Institute in Tokyo, Japan – a centre of excellence in robotics, artificial intelligence (AI) and financial technology.
Ant Financial, the Chinese electronic payment affiliate of Alibaba, has reportedly pushed back its plans for an IPO due to financial hurdles and a government crackdown on non-traditional financial institutions. The fast-growing payments startup was valued at $150 million (£117billion) in its latest fundraising round in June, but has decided to delay rumoured plans to list in 2018, according to the Financial Times.
Insurance premiums generated by emerging InsurTech services will exceed $400 billion by 2023, up from an estimated $187 billion in 2018, according to Juniper Research. The consultancy’s analysis found that InsurTech platforms will equip insurers to meet the challenges of diminishing margins and increased competition. However, while tech firms enable rapid transformation of traditional insurance business models, the adoption of these platforms by incumbents has been limited due to relatively slow rates of innovation within the industry.
FinTechs have hit back at the chief economist of the Bank of England’s warning that the UK will need a skills revolution to avoid “large swathes” of people becoming “technologically unemployed” due to artificial intelligence (AI) making many jobs obsolete. Andy Haldane said that job losses would be compensated for by the creation of new jobs as a “new technological wave” broke over society, but noted that lessons must be learned from previous shifts in industrial technology.
The UK generated £81.3 trillion in cashless payments in 2016, almost double the amount spent in any other European country, according to new research from Expert Market. The study assessed data for all 29 countries in the European Union, looking at the number of cashless transactions and total revenue from digital payments to determine the countries with the most digitally-ready businesses.
Previse, a FinTech startup that uses artificial intelligence (AI) to automate invoice payments to suppliers, has raised $7 million (£5.5 million) in series A funding. The London-based firm, which has developed technology that allows companies to pay B2B suppliers as soon as they receive an invoice, announced the investment from FinTech vehicle Augmentum and American venture capital firm Bessemer Venture Partners.
Ripple has signed collaboration deals with three new digital asset exchange partners for xRapid – the company’s cross-border payments product. xRapid is reliant on a healthy ecosystem of global digital asset exchange partners, enabling payments to move between currencies and XRP quickly and efficiently. The new deals include Bittrex, which will now be the preferred digital asset exchange for transactions that move through US dollars
Challenger bank Starling is rolling out its first unsecured loan products, offering customers the chance to choose how they structure lending up to £5,000. Users of the mobile-only bank can request a loan through its app and will have instant access to the funds as soon the borrowing has been approved. They will then be able to decide the dates of payment and the repayment schedule.
While several automated, or ‘robo’, advice startups have recently called it quits, analysis from GlobalData suggests the fledgling industry can still offer competitive advantage to traditional wealth managers. Following in the footsteps of WorthFM, SheCapital and Owners Advisory, New York-based robo advisor Hedgeable finally went out of business on 9 August 2018, just short of its 10-year anniversary.
Blockchain specialist Axioni has closed a $32 million Series B financing round, led by Goldman Sachs and Nyca Partners. The new funding, which brings the total investment in Axioni to over $55 million, will be used to enhance its data synchronisation technology, expand its suite of infrastructure products and broaden the network of enterprises leveraging distributed ledgers.
Blockchain continues its advance as a RegTech tool of choice as the American Association of Insurance Services (AAIS) announced it is using distributed ledger technology from IBM to automate its new regulatory reporting platform. The AAIS, a not-for-profit advisory organisation for the US property and casualty insurance industry, has launched a platform called openIDL (open Insurance Data Link) to improve regulatory and compliance processes and increase accuracy.
Deposit Solutions, an Open Banking platform for savings deposits, has closed a $100 million investment round led by Vitruvian Partners. The company’s platform enables institutions to gain access to deposit funding from the clients of other points-of-sale in different markets without having to set up and operate their own deposit infrastructure for new customers. Deposit Solutions also operates its own proprietary points-of-sale under the brands of Zinspilot and Savedo, which market the deposit offers of its partner banks directly to savers.
US retail giant Amazon is considering the development of a UK insurance price comparison site after contacting leading European insurance firms to see if they would contribute products. This is according to a report from Reuters, which stated that three industry executives told the publication that they have held talks with Amazon regarding the possible launch of a site. One executive told Reuters that talks were part of several discussions Amazon is having with insurers, while a second said there was no imminent plans for launch.
The first trial of an authenticated voice banking service has been launched to customers in Canada. Innovation Credit Union and Conexus Credit Union will take part in a pilot by banking services provider Central 1 which will see customers control a number of bank account actions via voice command on Amazon Alexa devices.
ClauseMatch, a London-based regulation technology (RegTech) firm has become the first company to join the Investment Association (IA) in the new FinTech membership category.
The trade body launched its drive to recruit members into the new category in a bid to boost engagement between FinTechs and members in the asset management industry.
Due to phenomenal demand the deadline for entering the 2019 FStech Awards has been extended until close of business on Friday 7 December. The awards are returning for their 19th year in 2019, with financial institutions and technology providers are wlecome to submit their entries for a chance to win a prestigious trophy. Celebrating technology excellence and innovation within the UK and EMEA financial services sector, the 2019 FStech Awards will have 28 trophies up for grabs, including one new category – Cryptocurrency Innovation of the Year.
The Competition and Markets Authority (CMA) and the Financial Conduct Authority (FCA) have rolled out a new initiative which requires banks to publish information on their services - including online and mobile services - to enable customers to easily compare accounts from different providers. The new requirements follow an independent survey of thousands of personal and small business customers.
Alternative payment methods, such as mobile and digital wallets, are steadily displacing traditional payment methods such as cards, bank transfers and cash/cheques in the Asia-Pacific (APAC) region. Data and analytics company GlobalData forecasts the APAC e-commerce market to grow from $1.6 trillion in 2018 to $2.3 trillion in 2022.
Millennials are the generation most likely to embrace new technologies such as Open Banking but they also hanker after the human touch when it comes to managing their finances, according to new research. A survey of 1,000 adults conducted by Altus, a UK-based financial services consultancy, suggested that over half (53 per cent) of 25-34 year olds would be happy to allow a web-based service to review and manage their personal finances, compared to 35-44 year olds (51 per cent), 45-54 year olds (47 per cent) and the over 55s (38 per cent).
Security flaws in a number of market-leading mobile point of sale (MPoS) devices could leave customers open to fraudulent charging and vulnerable payment methods, according to researchers. Leigh-Anne Galloway and Tim Yunusov, researchers from security firm Positive Technologies, looked at seven MPoS devices popular in the US and Europe, including devices sold by Square, iZettle, PayPal and SumUp.
Capital On Tap has secured £90 million in debt funding from M&G Investments and Triple Point Investment Management, along with a £50 million debt line from Citibank and Pollen Street Capital. The startup is not publicly disclosing its valuation, but it has now raised over £30 million of equity and £200 million of debt to date.
Millions of fax machines could be vulnerable to malicious hackers using booby-trapped image data to gain access to internal networks, security researchers have found.
Yaniv Balmas and Eyal Itkin, security researchers at CheckPoint, a US software company, found that the owners of more than 300 million active fax numbers could be leaving themselves open to so-called ‘faxploitation’ attacks.
The Bank of England (BoE) is looking to explore the demand for introducing synchronised settlement to the renewed Real-Time Gross Settlement (RTGS) service. It has issued a call for interest from FinTech firms to help investigate the potential and understand the design implications for organisations which would interface with the system.
Moneyhub has secured Payment Initiation Services Provider authorisation from the Financial Conduct Authority, a step further from its current Account Information Services Provider status. The financial management platform has also launched an application programming interface (API) gateway, which it described as a ‘one stop shop’ of personalised, permission-based, financial data sources, giving development teams access to data streams to help build innovative customer solutions.
The World Bank has chosen Commonwealth Bank (CBA) to be the sole arranger of the first global bond to be created, allocated, transferred and managed using blockchain technology. The Australian dollar denominated ‘bond-i’, or Blockchain Offered New Debt Instrument, has been developed with input from the investor community, including Northern Trust, QBE and the Treasury Corporation of Victoria.
Norwegian banks Sbanken, Sparebanken Vest, and Sparebanken Sogn og Fjordane have joined forces to let customers view accounts from across all three in either’s online banking platform. The initiative is set to be rolled out well in advance of next autumn’s mandated introduction of the second Payment Services Directive (PSD2), giving the banks a head start in the FinTech-led account aggregation space.
INTL FCStone’s London-based Precious Metals Division has started using Paxos’ technology to automate trade confirmations, reduce errors and secure instantaneous reconciliation. The startup’s service will confirm all of the trades INTL FCStone executes on a daily basis, eliminating thousands of manual tasks every day, while improving operational precision.
A combination of incumbent insurers wanting to update their propositions, and startups realising they require help scaling up, means the InsurTech space is ripe for partnership. This is according to the Association of British Insurers’ assistant director and head of strategy, data and analytics Matt Cullen, who suggested that the market is finally getting closer to making technology pay.
JDA Software has completed the acquisition of Blue Yonder, which builds artificial intelligence (AI) solutions for retail and supply chain. JDA hopes the acquisition will accelerate its Autonomous Supply Chain capabilities by connecting its systems and data to enable automated and more profitable business decisions. Blue Yonder’s software-as-a-service (SaaS) solutions also further fuel development of JDA’s Luminate cognitive SaaS platform and solutions.
Serious security vulnerabilities have been discovered in several leading mobile, desktop and web stock trading applications by IOActive. Alejandro Hernandez, senior security consultant at the cyber security firm, tested 16 desktop applications, 30 websites and 34 mobile applications, finding “major vulnerabilities” that can allow malicious actors to gain access to a user’s personal banking information, steal money and gain insights into net worth and investment strategies.
Visa has announced an investment and partnership with Israeli FinTech firm, Behalf, which provides working capital solutions for small businesses and financing for business purchases. As part of Visa’s investment, Behalf’s small-business clients will be offered a tokenised virtual card, a credit-based payment solution that gives businesses instant financing for their business purchases.
More than 33 billion records will be stolen by cyber criminals in 2023 alone, according to Juniper, representing an increase of 175 per cent on the 12 billion records expected to be compromised in 2018. Despite this, Juniper forecasts that cyber security spend will only increase by an average of nine per cent per company per annum, in spite of new legislation mandating strong cyber security and authentication measures.
CurrencyFair has announced an Asian expansion through the acquisition of Hong Kong-based Convoy Payments. The deal is part of the Irish money transfer service’s €20 million investment plan to drive global growth, which will also see the creation of 90 new jobs over the next 18 months. These will be created with particular emphasis on product development, customer service, compliance and marketing and global partnership development.
US FinTech firm Steady has secured $9 million in a Series A funding round, led by Propel Venture Partners – BBVA’s venture capital investment unit. Steady is an income-building platform for the Build-Your-Own (BYO) workforce, offering income-building opportunities, an income tracker and exclusive discounts. The firm helps workers to find and apply to new opportunities that match their availability, abilities and interests.
The Financial Conduct Authority (FCA) has, in collaboration with 11 financial regulators and related organisations, announced the creation of the Global Financial Innovation Network (GFIN). The network builds on the FCA’s proposal earlier this year to create a global sandbox, providing a more efficient way for innovative firms to interact with regulators, helping them navigate between countries as they look to scale-up new ideas.
CYBG is working with The ID Co. to integrate its DirectID Open Banking platform into the bank’s mobile banking app. Customers of CYBG’s banking app - called B - will now be able to import banking data from a range of UK banks including: Barclays, HSBC, Lloyds Group, Santander, RBS, and Nationwide, as well as digital banks such as Starling and Monzo.
Facebook has reportedly asked several leading US banks to share financial information about their customers – including card transactions and checking-account balances. As part of a push to become the portal where people buy goods and services, the social media platform has been in talks with the likes of JPMorgan Chase, Wells Fargo and Citigroup, according to the Wall Street Journal.
The Arizona Attorney General’s Office will launch the first FinTech sandbox in the US, easing regulatory burdens for companies to test innovative FinTech products and services while remaining subject to the state’s consumer protection laws. Navigating state regulatory requirements can often take several months and cost tens of thousands of dollars. The new sandbox will provide firms with relief by lifting some regulations and allowing some products and services to be live-tested in a marketplace limited to a capped number of consumers.
Australia’s digital-first UBank has introduced a new feature that allows customers to follow the real-time progress of their home loan application online. The bank wanted to streamline a process that is generally complex and confusing, with customers often getting frustrated when trying to get a status update from different customer service agents. Earlier this year, UBank also launched a chatbot to help potential home buyers and refinancers complete their online home loan applications.
Intercontinental Exchange has revealed plans to form an open and regulated platform where consumers can buy, sell, store and spend digital assets. Called Bakkt, the new company will be working with various organisations including BCG, Microsoft, Starbucks and others to add expertise in risk management, technology and consumer experience. By leveraging trusted market infrastructure, Bakkt is being designed to help the digital asset markets evolve securely while supporting transaction flows.
Investors who backed Revolut in the digital bank’s latest investment round on Crowdcude have now realised returns of 19x on their original investments. In July 2016, Revolut held a funding round on Crowdcude which enabled the public to invest as little as £10 or as much as £5,000. In April this year, Revolut received a $250 million investment led by DST Global, setting a valuation of £1.2 billion.
Russia’s Sberbank has appointed senior vice president and chief technology officer David Rafalovsky as head of the Technology Block, where he will carry out strategic management of Sberbank’s technology functions. Prior to joining Sberbank, Rafalovsky spent 20 years at Citigroup in the US, where he started his career as a lead solutions architect and worked his way up to global head of finance and risk infrastructure technology.
UK-based FinTech firm Zopa has announced it has raised £44 million in the first phase of its latest fundraising round, marking its largest funding round to date. The funding comes during an exciting time for the firm, who reported full profitability last year for the first time since 2012. The injection of funding will be invested towards the capital needs of the new bank it has been building.
Asian online to offline (O2O) mobile platform Grab Holdings has raised $2 billion in its latest fundraising round. Toyota Motor Corporation joined the likes of OppenheimerFunds, Ping An Capital, Mirae Asset Management, Cinda Sino-Rock Investment Management Company, All-Stars Investment, Vulcan Capital, Lightspeed Venture Partners and Macquarie Capital.
Barclays is partnering with Europe’s largest online invoice financing platform MarketInvoice to help small and medium enterprises (SMEs) in the UK manage cash flow and accelerate growth. The bank has committed to a significant minority stake in the FinTech firm to give Barclays’ SME clients access to innovative forms of finance. Founded in 2011, MarketInvoice has funded invoices worth more than £2.7 billion, helping small businesses with their cash flow.
Nearly two thirds of UK companies are planning a significant increase in IT investment next year, in response to fears around the impact of Brexit, according to new research by MHR Analytics. The business intelligence and analytics provider commissioned Censuswide last month to survey 200 decision-makers in large and medium sized UK businesses.
Almost three quarters (72 per cent) of UK adults have not heard of Open Banking, while just one in three (28 per cent) are aware of it, according to a YouGov survey. In terms of who has heard of the term, it is those in the older age groups that are more likely to be aware. Almost 40 per cent of those aged over 55 have heard of open banking, against just 14 per cent of those aged 18-24.
Nationwide Building Society has announced its second investment as part of a £50 million Venturing Fund designed to create long-term FinTech partnerships. Hazy, based in London and formed just 18 months ago, is an online platform that helps businesses share data responsibly. Its artificial intelligence-driven solution is able to seek out and anonymise personal data, supporting businesses in ensuing customer data is as private and secure as possible.
The Financial Conduct Authority (FCA) is consulting on rules and guidance to improve conduct standards and communications in the payment services and e-money sectors. Its paper proposes to extend the application of the Principles for Businesses and certain specific rules about promotions and communications so that they cover wider categories of businesses – including those authorised or registered under the Payment Services Regulations or the Electronic Money Regulations.
The US Department of the Treasury has outlined improvements to the regulatory landscape in support of FinTech innovation. “Creating a regulatory environment that supports responsible innovation is crucial for economic growth and success, particularly in the financial sector,” said secretary Steven T. Mnuchin. “We must keep pace with industry changes and encourage financial ingenuity to foster the nation’s vibrant financial services and technology sectors.”
New research from Frost & Sullivan has found that UK consumers have only a marginal degree of trust in organisations to protect their digital data. The Digital Trust Index is based on various metrics, including how willing customers are to share personal data with organisations, how well they think organisations protect that data and the extent to which consumers believe companies sell their personal data to third parties. The index is based on a rating out of 100, with 100 representing “total trust”.
The UK has attracted more FinTech investment than any other country during the first half of the year, with fundraising worth $16.1 billion (£12.3 billion). KPMG’s industry report found that China came in second place with $15.1 billion, followed by the US at $14.2 billion. Globally, FinTech investment took in $57.9 billion across 875 deals during the first half – up 34.2 per cent compared to the whole of 2017, which recorded just $38.1 billion overall.
Australia’s Commonwealth Bank has demonstrated a new blockchain platform to ship and track seventeen tonnes of almonds from Sunraysia in Australia to Hamburg in Germany. The trade was underpinned by distributed ledger technology (DLT), smart contracts and the internet of things (IoT), which tracked the shipment from packer to end delivery in parallel to existing processes.
AXIS Capital Holdings has launched AXIS Digital Ventures, a new unit to lead partnerships with entrepreneurial companies focused on data and analytics with high value insurance applications, new product opportunities and new distribution models. The Digital Ventures business is also charged with introducing innovative technologies across the company’s businesses, following an announcement earlier this year about strengthening its operating model to become more agile and better positioned to leverage change.
Legal & General’s FinTech business has made a £3 million investment in software as a service (SaaS) company Smartr365. The business was established in 2016 with the aim of helping mortgage brokers deliver a digital and more efficient service for customers. Its services include online fact finding tools, customer verification processes and a unique customer portal.
Contrary to widespread perception, new research has revealed that 88 per cent of crypto exchanges want industry regulation. The figures come from crypto-friendly payment company Mistertango, which interviewed 24 crypto exchanges across Europe, Asia, South America and Oceania, with total daily trading volumes of over $100 million.
Driven by payment cards and mobile wallets, in-store contactless payments will reach $2 trillion by 2020 – representing 15 per cent of total point of sale transactions. This is according to new research from Juniper, which found that contactless payments will exceed the $1 trillion mark for the first time in 2018, a year earlier than previously anticipated. The study found that growth will be driven by strong adoption in Europe as well as the Far East and China.
Financial market infrastructure group CLS has announced a collaboration with IBM to develop a proof of concept (PoC) for distributed ledger technology (DLT) platform LedgerConnect. The aim is to enable banks, buy and sell side firms, FinTechs and software vendors to deploy, share and consume services hosted on a shared distributed ledger network.
Cross-border B2B payments technology firm TransferMate has announced a €21 million investment from Dutch bank ING. The two companies have also agreed a strategic partnership, with TransferMate’s services made available to all SME and corporate clients of ING. TransferMate’s cross-border API technology and global payment licences will reduce international payments costs and improve cash flow for ING business customers who send or collect funds cross-border.
TSB has reported a £107.4 million first half loss, with its botched IT migration in April at least partly to blame. For the first six months of 2018, the British High Street bank recognised additional post-migration costs totalling £176.4 million.
While just 15 per cent of travel companies have attempted new payments innovations in the past three years, 81 per cent plan to initiate at least some new innovation projects in the next three years. These are the findings of 78 in-depth interviews with payments managers from hotels, airlines and travel intermediaries conducted by technology firm Amadeus.
Following a post-implementation review of its crowdfunding rules, the Financial Conduct Authority (FCA) is opening a consultation on new rules for loan-based crowdfunding platforms. The changes are designed to address the ways in which the loan-based crowdfunding model has developed since the regulator last reviewed the sector in December 2016. Since then, the FCA has observed the variety of loan-based crowdfunding business models, some of which have become increasingly complex.
Several law firms and technology companies have agreed to work together to launch a public, permissioned blockchain network, which aims to redefine how legal products and services support the networked economy. The Agreements Network brings together law firms BakerHostetler, LegalBono and ErdosIP and FinTechs Clause, Crowdcube, LexPredict, Libra, Mattereum, Monax, Rymedi, TransparentNode and Wolfram Blockchain Labs.
CYBG - owner of Clydesdale Bank, Yorkshire Bank and digital banking service B - has announced a strategic partnership with PayPal, designed to enhance digital payment options for customers. The partnership will enable customers to link their debit and credit cards with PayPal accounts directly from the B mobile banking app.
Visa has signed a strategic agreement with MoneyGram that is aimed at modernising and digitising the process of sending and receiving money overseas. Using Visa’s real-time push payments platform, Visa Direct, the agreement will enable secure cross-border remittances. Once live, MoneyGram’s service will enable its users to choose their preferred method of sending and receiving funds.
The UK’s banking industry is stepping into a new era, according to one challenger bank boss, with traditional High Street players starting to take notice of the FinTech revolution. “I think we are definitely beginning to take steps in to a new era of banking, but this will largely be influenced by technology,” stated Norris Koppel, chief executive and founder of mobile banking app Monese. “This is something we have seen the traditional banks begin to embrace, perhaps this is to keep up with the fast pace being set by digital challenger banks.”
Dutch FinTech Five Degrees has acquired Icelandic banking IT provider Libra as part of its international growth plan. The deal adds value for customers of Five Degrees through its core banking solutions in the field of securities and loans, offering a clear roadmap to retire obsolete and expensive back-end systems.
Credit Suisse Asset Management’s FinTech fund NEXT Investors has announced final closing with approximately $261 million of capital commitments. The fund has a diverse group of investors, including financial institutions, ultra-high net worth individuals, fund of funds, and family offices across the Americas, Europe and Asia Pacific.
The Financial Conduct Authority (FCA) has banned the former directors and shareholders of the now dissolved Secure My Money for taking fees of over £7.2 million from approximately 124,000 online customers by duping them into believing they had been approved for short term loans. Between November 2013 and July 2014, David James Carter Mullins, Edward John Booth, Christopher Paul Brotherton and Mark Robert Kennedy all lacked honesty and integrity as they had deliberately misled often vulnerable customers, in relation to fees and services provided through web-based brands i-loansdirect, LoanZoo and the1loan.
Customers of digital currency exchange Coinbase will now be able to spend their cryptocurrency balances on e-gift cards, following a partnership with WeGift. Customers in the EU and Australia will now be able to spend the funds in their crypto accounts with retailers including Nike, Tesco, Uber, Google Play, Ticketmaster, Zalando and more. There will be no Coinbase withdrawal fees, while there will be bonuses on selected e-gifts.
SWIFT, along with a number of corporates and banks, has announced plans to start testing an enhanced multi-bank standard to improve cross-border payments for multi-banked corporates. This enhanced standard, designed and built in conjunction with 10 multinational corporates and 12 leading banks, streamlines the process for treasurers by allowing them to initiate and track SWIFT global payments innovation (gpi) payments to and from multiple banks in a single format.
The Payments Systems Regulator (PSR) is looking to carry out a market review into card-acquiring services and has published draft terms of reference for consultation. Card payment use is growing, with the PSR stating that last year in the UK, 13.2 billion payments were made by debit card and an additional 3.1 billion payments by credit card. Also in 2017, for the first time, debit cards became the most frequently used payment method.
Mobile biometrics will authenticate $2 trillion worth of in-store and remote mobile payment transactions annually by 2023 – 17 times the $124 billion expected in 2018. This is according to a new study from Juniper, which expects the growth to be driven by over 2,500 per cent growth in remote biometric transactions. The study predicts that remote m-commerce transactions will reach over 48 billion in volume by 2023, representing around 57 per cent of all biometric transactions – up from an estimated 28 per cent in 2018.
Distributed ledger technology (DLT) provider Digital Asset has partnered with Google Cloud to make its blockchain platform and developer tools available on the Google Cloud platform. Developers now have access to a comprehensive suite of tools and services to build, test and deploy distributed ledger applications on-demand and without having to configure the underlying platform. In collaboration with Google Cloud, Digital Asset has expanded its developer programme to include the DAML platform-as-a-service (PaaS) on Google Cloud Platform.
Banks are increasingly using advanced ATM software platforms to modernise customer identification and authentication, improve customer personalisation and maximise the performance of self-service channels. This is according to consulting firm RBR, which interviewed 30 leading banks, finding that while most ATM transactions are still carried out using the traditional card and PIN combination, advanced software platforms now support a wider range of technologies and form factors.
PayU has announced the acquisition of Israeli payment technology provider ZOOZ, supporting ongoing expansion into high-growth markets. The move brings PayU’s total sum of investments and acquisitions to more than $350 million since it began a series of strategic moves across the globe in 2016. The ZOOZ and PayU teams will work together to build a flexible ‘Payment OS platform’ that can support evolving merchant and broader payment industry needs.
PropTech company Goodlord has partnered with Open Banking provider TrueLayer to enhance its functionality and service offering to letting agents, landlords and tenants. Founded in 2014, Goodlord’s proprietary technology streamlines deposits, contracts, compliance, tenant move-in assistance, insurance and referencing.
Barclays has announced plans to develop a new campus in Glasgow, which will provide a state-of-the-art workplace for the bank’s functions, technology and operations teams. Barclays has agreed to purchase the office development from Drum Property Group and is currently working with them to finalise the design of the new facility as part of the wider Buchanan Wharf development on the River Clyde.
Singapore’s OCBC Bank has revealed plans to reduce the number of bank teller positions by half over the next two years, as it drives forward with branch digitalisation. Bank tellers will be retrained over the next five years to be able to perform digital or advisory roles, while $14 million will be invested in the deployment of new ATMs and digital service kiosks across the bank’s estate.
The Investment Association (IA) has established the first cohort of innovators for Velocity, its FinTech accelerator for the asset management industry. The 24-strong Velocity advisory panel, chaired by Schroders’ chief digital officer Graham Kellen, will oversee the selection process, providing guidance on the adoption of emergent technology across front, middle and back office operations.
Key industry stakeholders have warned that the UK’s exit from the European Union could lead to a serious ‘brain drain’ in the booming FinTech sector. Speaking at last week’s London FinTech Week, senior spokespeople at various venture capital firms with stakes in the industry gave honest opinions on what impact Brexit could have.
Cambridge City Council has installed two contactless donation terminals, where members of the public can donate to Cambridge Street Aid – a charitable fund for the homeless in the city. Passers-by can donate using contactless debit or credit cards, or smartphones – 24 hours a day at one terminal, or any time during the Visitor Information Centre’s regular opening hours.
The US Consumer Financial Protection Bureau (CFPB) has appointed Paul Watkins to lead its new Office of Innovation. Acting director Mick Mulvaney said the Office of Innovation “will make significant progress in creating an environment where companies can advance new products and services without being unduly restricted by red tape that belongs in the 20th century”.
The prolific MoneyTaker hacking group has stolen around $910,000 from Russia’s PIR Bank by gaining access to its network by compromising a regional branch’s router. Cyber security firm Group-IB confirmed that the attack started in late May 2018. The router had tunnels that allowed attackers to gain direct access to the bank’s local network – a characteristic technique of MoneyTaker.
The Hong Kong Monetary Authority (HKMA) has published its Open application programming interface (API) framework for the banking sector. Its formulation is one of the seven initiatives announced by the HKMA last September to prepare Hong Kong for a new era of Smart Banking.
Cisco will be investing $100 million to accelerate digital innovation in the UK, supporting partnership with industry, government and academia. As part of the initiative, the IT and networking company has collaborated with University College London (UCL) to open one of the world’s largest artificial intelligence (AI) research centres, with a focus on addressing industry challenges and developing AI talent in the UK.
UK FinTech firm PayBreak has secured an additional £15 million of funding from specialist banking group Paragon as part of its growth plans. PayBreak specialises in digital point of sale finance through online retailers, allowing customers to spread the cost of payments on purchases through its online lending platform.
JLT Employee Benefits has acquired digital saving and investment service Moola, subject to regulatory approval. The deal is aligned to JLT’s strategy of helping UK businesses deliver better employee financial, emotional and physical wellness. Moola offers ISAs, GIAs and tax efficient investment portfolios, along with free educational content to empower individuals with the knowledge to make smarter decisions with their money.
Moneysupermarket has revealed plans to launch a new FinTech firm dedicated to the mortgage market, Podium, as part of its interim results. “Customers are already looking to us for help with mortgages and we are developing a new mortgage comparison tool to find them the most appropriate mortgage online,” read the report.
An academic has warned that even the smallest error in RegTech solutions can create systematically erroneous outcomes, leading to large scale liability risks. Veerle Colaert, a professor of financial law at KU Leuven University and a member of the European Securities and Markets Authority stakeholder group, published a paper this week looking at how technological solutions have emerged to help with regulatory compliance requirements.
The Depository Trust & Clearing Corporation (DTCC) has announced intentions to open a Dublin office ahead of the UK’s planned withdrawal from the European Union in March 2019. “DTCC has had a strong presence in Europe for over two decades, including in London, Wrexham, Brussels, Frankfurt and Stockholm. Our continued growth and desire to get ahead of new regulatory obligations, because of Brexit, now takes us across the Irish Sea to Dublin,” said Simon Farrington, managing director for EMEA at DTCC.
Santander has installed a new bank operating system from nCino, which will provide business customers with faster loan processing and a superior digital experience. The new cloud-based platform is accessible to customers from any device and will cut the time taken to deliver loan processing by 40 per cent. The solution combines customer relationship management, loan origination, account opening, workflow, enterprise content management and instant reporting capabilities.
BlackFin Capital Partners is positioning itself as the largest independent FinTech fund in Europe after finalising a €180 million final closing. BlackFin Tech 1’s investment thesis attracted a range of high profile investors, including: Bpifrance, Vaudoise Assurances Group, Groupama, Sogecap (Société Générale Insurance), Natixis Assurance, Swiss Life, German public bank KfW, Belgian insurer Securex, the groups MACIF, BNP Paribas, as well as large family-offices from the sector and regional entities of banking groups Crédit Agricole, Banque Populaire et Caisse d’Epargne.
The Financial Stability Board (FSB) has published a report delivered to the G20 Finance Ministers and Central Bank Governors on crypto-assets, stating that they do not pose a material risk to global financial stability at this time. The FSB has developed a framework, in collaboration with Committee on Payments and Market Infrastructures (CPMI), to monitor the financial stability implications of developments in crypto-asset markets. The report sets out the metrics it will use to monitor these markets as part of an ongoing assessment of vulnerabilities in the financial system.
Credit checking company ClearScore is to use Open Banking to give consumers detailed insight into their financial situation to prompt mortgages and credit card switching. Set for a Spring 2019 launch, the OneScore service will combine credit scores with information pulled from current accounts, savings and insurance to give a financial ‘healthscore’, with analysis of spending patterns and recommendations on how to save money.
Amir Nooriala has joined FinTech challenger bank OakNorth as chief operating officer, where he will be responsible for internal operations, technology and change delivery of the bank, including all IT systems and operational processes. Nooriala joins the bank from BGC Partners, where he led the restructuring of the broker’s change function.
NatWest has joined Marco Polo, the trade finance platform that uses blockchain technology to reduce the costs, risks and time involved in businesses trading with each other. The initiative is coordinated by the financial technology firm TradeIX and R3 to collaboratively apply emerging blockchain technology to the global trade finance market.
The European Insurance and Occupational Pensions Authority (EIOPA) has released a survey to collect views on the emerging InsurTech industry. The industry body is aiming to get a better picture of those not directly active in the insurance value chain on InsurTech and the technology-enabled innovation in insurance that could result in new business models, applications, processes or products.
Since implementing a new advanced operations management system, Nationwide Building Society has enjoyed better real-time visibility of work and available-skilled resources. Nationwide felt that it was no longer sufficient to just review past performance as a guide for future operational plans, but required breaking down the data silos, cross-training employees and sharing skilled resources. The building society enlisted the support of ActiveOps to provide new tools and proven training for staff.
The UK has all the resources, as well as industrial and governmental will, to become a global hub for blockchain and the crypto economy by approximately 2022, according to a new report. This year should mark the inflection point at which it will become clear if the UK has marshalled its existing resources across industry, government, academia and thought leadership to achieve this exciting opportunity.
UK consumers are looking for innovative, digital payment experiences with their banks, according to a new YouGov survey on behalf of Ondot. The results found that online security and fraud prevention tops the list of what British consumers think banks should guarantee – with 60 per cent wanting peace of mind when using their cards online. The survey also discovered that consumers are keen to play a much more proactive role in managing their personal finances.
Mastercard has announced a partnership with payments technology firm Worldpay, focused on expanding acceptance options and making digital payments more convenient and secure. Through the partnership, Worldpay will offer Mastercard’s Pay by Bank app to merchants in the UK starting in early 2019. Pay by Bank enables customers of UK businesses to make online payments for goods via their mobile banking app, directly from their bank account.
The wealth management sector has a new entrant, in the form of Tiller, which promises to combine proactive investment management with intelligent technology. Looking to differentiate itself from other digital-only wealth managers, Tiller is offering actively-managed funds and themed investment baskets alongside low-cost passive investment products.
Saudi Arabia’s Capital Market Authority has granted FinTech experimental permits to Riyadh-based startups Manafa Capital and Scopeer. This follows the regulator’s backing for FinTech earlier this year, aiming to provide a regulatory framework that is conducive for financial innovation.
Only 20 per cent of companies surveyed believe they are compliant with the General Data Protection Regulation (GDPR), while 53 per cent are in the implementation phase and 27 per cent have not yet started their implementation. This is according to a survey carried out by Dimensional Research on behalf of TrustArc in June among 600 IT and legal professionals with responsibility for privacy at companies required to meet GDPR compliance, split equally among the US, UK, and European Union.