Regulator issues warning on Lanister, Atom Bank teams up with Codat, Revolut Business now accepts payments online.

This year has seen people, including older generations, flock to banking online and on their phones to ensure they stay on top of their money and bills amidst the COVID-19 pandemic, according to new research from Mastercard.

The reasons for the shift to digital banking are clear, with two thirds (65%) of over 65-year-olds stating that the biggest advantages of online banking and mobile payment solutions are that they’re simple to use while 61% say they save them time and 30% believe they’re a safer way to transact.

Read more here.

PODCAST

Our podcast recommendation of the week is for the Million Dollar Startup. In this episode, you'll meet the FinTech founders who were selected from a large worldwide pool of applicants to compete in the Million Dollar Startup pitch competition. Listen here.

REPORT

Today, more and more people have accounts on challenger banks – in many cases, in more than one – and many customers treat these accounts as their primary ones, even receiving their salaries in them. This raises the question of whether incumbents could ever be replaced by challenger banks. Just in 2019, challenger banks struck 138 deals, receiving a record $5.3 billion in equity funding.

However, the word “bank” can sometimes be misleading, and quick research on the top 10 challenger banks by valuation has highlighted the reality of the nature of these so-called “banks”. Only 3 out of the top 10 challenger banks are real banks.

Read more of CFTE's research here.

NOW, ON TO THE SUMMARY OF LAST WEEK'S DIGITAL BANKING SPACE

NEWS HIGHLIGHTS:

Ziglu celebrates its Mastercard debit card launch by donating the price of a meal to Fareshare every time a customer uses their card for their supermarket shop online and in store, regardless of the size of the transaction until the end of the year. Almost 1 million people a week access FareShare food from over 10,000 charities including food banks, children’s clubs and domestic abuse refuges. Link here.

INDUSTRY HIGHLIGHTS:

  • Angel Investors Syndicate. Join now! Link here.
  • Another Battle of Challengers! Find out more here.

MOVERS AND SHAKERS:

Business expense provider Soldo has appointed seasoned financial executive Mariano Dima as president. Dima, who previously held senior roles at the likes of Visa, Expedia, Vodafone and PepsiCo, will work alongside CEO Carlo Gualandri to help Soldo’s international expansion plans. Link here.

UNITED KINGDOM

Atom Bank teams up with Codat, Regulator issues warning on hyped fintech Lanister, and Revolut Business now accepts payments online.

UK-based digital bank Atom Bank has partnered with financial API provider to support the UK’s small businesses. The partnership will see Codat use their API to help Atom directly integrate with their business customers’ accounting platforms, without the need for manual processes. Link here.

It’s not been a great start for Lanistar, a hyped new London fintech which once proclaimed big ambitions to become Europe’s next billion-euro company. The UK financial regulator this week accused the company of offering unauthorized financial services, even warning that it could be a scam. Link here.

OakNorth’s lending platform business has sealed a significant client win in the form of commercial lending giant Sumitomo Mitsui Banking Corporation (SMBC), which comes with a nice bonus. SMBC has also taken a $30m stake in OakNorth through a secondary purchase of shares in the lender. Link here.

Monzo has seen the departure of another top-level executive, with its chief risk officer stepping down after just one year, the company confirmed to Sifted. Lisa Nowell has been replaced today by banking veteran Iain Laing, who has previously served at leading UK institutions including TSB Bank, Santander and Nationwide. Link here

Revolut Business has announced this week that UK businesses can accept card payments online and directly into their account. All Revolut Business customers on paid plans are about to receive an allowance of free UK and EEA card payment acceptance every month. This comes with no additional cost. Link here.

UK fintech startup Griffin announced an approx. €7.2 million round led by EQT Ventures to build an API-first bank that will dramatically lower the barrier to entry when it comes to launching new financial products and services. This new round follows the company’s approx. €3.3 million seed round announced earlier this year. Link here.

EUROPE

Northmill Bank partners with Tink, Santander buys Wirecard’s core EU business, and Juni raises €2M seed.

Monument has now signed agreements with a number of key technology providers to enable the build of its bespoke technology platform. The design of its lego-like technology platform is Monument’s solution to the huge challenges faced by the legacy systems of established banks. Link here.

Juni, a Swedish pre-launch startup that’s building a banking app and platform for e-commerce and online marketing entrepreneurs, has raised just over €2.1 million in seed funding. Leading the round is Berlin-based Cherry Ventures. Link here.

Swedish neobank Northmill Bank and the open banking platform Tink, have started a collaboration that will open up new opportunities for the neobank's more than 200,000 customers. Northmill Bank, which recently joined both RIX och Bankgirot, continues to create conditions for delivering personal and relevant banking services for everyone. Link here.

Solaris Digital Assets GmbH, a 100% subsidiary of Solarisbank AG, announced that it has won Bitwala, Germany’s crypto-banking flagship company, as a partner for its digital asset custody solution. Through this partnership, Bitwala now leverages the full spectrum of Europe’s leading Banking-as-a-Service platform, from digital bank accounts, cards and KYC to custody of digital assets. Link here.

Spanish lender Banco Santander is spending about 100m for Wirecard's core business in Europe in an exchange that marks an essential step to the dismantling associated with disgraced German repayments provider, which folded into insolvency come July 1st. Link here.

UNITED STATES

Betterment partners with Dosh, Affirm just made its IPO filing public, and Chase moves into buy now, pay later market.

Betterment has partnered with Dosh to offer cash back offers for Checking customers. With cash back offers from Dosh, customers can shop from thousands of personalized online and in-person offers within their Betterment account. Link here.

Mercury, a challenger bank based in San Francisco, is aiming to become a go-to account for start-ups emerging in the US. The bank says that it has designed accounts to help tech companies scale. Each comes with virtual cards, “API access”, and team management capabilities. Link here.

Affirm, a fintech startup that enables consumers to pay for online purchases as they go, publicly revealed its initial public offering documents on Wednesday. The company reported a net annual loss of $125.8 million for its latest fiscal year, which ended in June, down 6% from 2019 — while its annual revenue nearly doubled year-over-year to $509.5 million. Link here.

Daylight, a new challenger bank, launches in the US. Daylight provides its LGBTQ customers with benefits like Visa-branded cards in their preferred name (and not necessarily their legal name), a network of finance coaches, unique personalized feeds on financial advice, tools to monitor and improve spending habits, along with a space for donations to LGBTQ charities. Link here.

Movencorp, Inc., the NY-based fintech innovator announced a collaboration with Q2, a secure, cloud-based digital transformation company headquartered in Austin, Texas, to provide a turn-key digital bank-in-a-box that can be deployed in as little as 30 days. Link here.

Chase is wading into the booming buy now, pay later market, giving credit card customers the option to pay off a purchase over a period of time with no interest, just a fixed monthly fee. Available for purchases over $100, My Chase Plan enables cardholders to select a recent transaction and choose a repayment timeframe and personal monthly payment amount that can run from three to 18 months. Link here.

Neobank and smart money management app Douugh is moving out of beta and officially launching to the wider US market. The US launch comes a month after Douugh began trading on the Australian Stock Exchange (ASX) following a $6 million Series A fundraise and a reverse takeover of Australian telco ZipTel. Link here.

AUSTRALIA

Revolut, the leading fintech app with over 13 million customers globally, introduced Revolut Junior to its customers in Australia. Revolut Junior accounts are connected to a money management app and prepaid card designed specifically for kids between the ages of 7-17, with parents and guardians maintaining oversight. In the last year, the popular feature has been introduced to customers in the US as well as the UK and wider Europe, with approximately 10,000 Junior accounts created per week. Link here.

ASIA

SBM Bank India, a subsidiary of State Bank of Mauritius, is planning the launch of a neobank in the country. The bank is partnering up with payment fintech PayNearby to release a recurring deposit platform called Nivesh. Neeraj Sinha, head of retail banking at SBM, told the Hindu Business Line that it wants to build a “fintech with a banking license”. Link here

LATAM

Juvo, a pioneer of financial identities for the underbanked, announced a new partnership with Mastercard. Juvo was accepted into Mastercard’s global fintech startup engagement program, Start Path, last August. Now, Juvo is collaborating with Mastercard’s Latin America and Caribbean (LAC) team to introduce its FiDaaS (Financial Identity as a Service) platform to hundreds of financial institutions across the region. Link here.

CANADA

Mogo expands into the global B2B fintech market with acquisition of digital payments technology company Carta Worldwide. The transformational deal combines leading Canadian fintech with over 1 million members with next-gen payments technology platform that processed over $4.0 billion in transaction volume in 2019. Link here.

This ends my weekly digest. Let me know if there are any questions or news/insights worth mentioning in next week's digest. Until the next!

NOTE: This article was featured in my weekly newsletter on November 22th, 2020. Do you want to be the first to read the next weekly overview? Sign up for my Weekly Digital Banking Newsletter here.
 
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