Financial Innovation Roundup e54
Here are 15 news stories you don’t want to miss from the past week in financial services innovation (Mar 24 – Mar 30, 2024)
#industryinsights
There was a climb in investment in the FinTech sector this week, with FinTech Global reporting on a total of $399m being raised across the 18 deals reported.?
The biggest funding round this week was found in the cybersecurity sector, with Coro pulling in an impressive $100m to reinforce cybersecurity amongst small and medium sized firms.
#artificialintelligence #ai #dataanalytics
Visa has added a trio of AI-powered risk and fraud prevention tools to its suite of products for businesses. The new products for business clients are part of the Visa Protect suite and designed to reduce fraud across immediate account-to-account and card not present payments, as well as transactions both on and off Visa’s network.
The new Visa Deep Authorisation (VDA) is a transaction risk scoring tool tailored to better manage CNP payments. Powered by deep learning AI risk models and petabytes of contextual data, VDA is designed to combat fraud without disrupting digital transaction experiences.
Meanwhile, Visa Advanced Authorisation (VAA) and Visa Risk Manager (VRM) are now network scheme agnostic, allowing issuers to simplify their fraud operations into a single solution.
Finally, the firm has unveiled its first fraud prevention tool built specifically for immediate payments, including P2P digital wallets, account to account transactions, and central banks’ instant payment systems. Powered by deep learning AI detection models, the service provides a risk score in real time that helps financial institutions prevent fraud by automatically blocking bad transactions before they happen.
3.???? Evolve ETFs and Boosted.ai : Launch Artificial Intelligence Fund
Evolve Funds Group Inc. announced the launch of Canada’s first Artificial Intelligence (“AI”) Fund using generative AI to enhance portfolio construction. The Evolve Artificial Intelligence Fund (“ARTI” or the “Fund”) has closed its initial offering of units and will begin trading on the Toronto Stock Exchange (“TSX”) today under the ticker symbol: ARTI.
ARTI is designed to provide investors with exposure to AI companies expected to benefit from the increased global adoption of AI.? The Fund is actively-managed by Evolve and seeks to achieve its investment strategy by principally utilizing a database generated by Gradient Boosted Investments Inc. (“Boosted.ai ”).
Boosted.ai ’s proprietary large language model technology (“Proprietary LLM Technology”) determines a company’s applicability to the theme of AI based on its likelihood to benefit from increased global adoption of AI. The Proprietary LLM Technology considers securities of issuers from developed markets that are directly involved in the development of AI, including related technologies and services and those whose business models or operational efficiencies may be significantly enhanced by AI integration.
?#blockchain #crypto #cbdc
4.???? eToro : adds 12 tokens to crypto lineup
?“We are excited to enable our customers to access these new assets, covering a large range of new ideas and concepts emerging from the ecosystem,” said Omri Ross, Chief Blockchain Scientist at eToro. “We have selected these new listings based on the broad spectrum of novel concepts they represent. By investing in these new cryptoassets, our customers can gain exposure to the app-chain thesis, TradFi on-chain, Solana DeFi and MEV, EVM-chain alternatives and several other exciting new communities and concepts.”
The latest additions include layer 1 blockchains (Near Protocol, Sei, Injective, Sui), tokens in the ecosystems of Ethereum (Ronin, Ocean Protocol), Solana (Jito Network, Orca) and Cosmos (Osmosis), as well as other innovative networks (Celestia, Axelar).
“These new listings complement eToro’s existing crypto offering by expanding into the Cosmos and Solana ecosystems, paving the way for new listings representing these rapidly growing communities of developers,” added Omri Ross.
N26 has launched N26 Crypto, a new cryptocurrency trading product aimed at optimizing the customer experience in France. This latest offering enables N26 customers in France to invest in over 200 cryptocurrencies directly through the N26 application.
The introduction of N26 Crypto signifies the company's focus on providing accessible and efficient cryptocurrency investment options to its clientele. Eligible clients with French or German IBANs can access N26 Crypto across all membership tiers, including free accounts, without incurring additional costs.
According to the firm, transparency and security are paramount in N26 Crypto's design. Users will have clear insights into their cryptocurrency portfolios and transaction histories within the application. N26 emphasizes adherence to regulatory requirements and industry standards to ensure a compliant and secure trading environment.
#digitalbanking ?#neobank #challengerbanks
The investment round was led by Adjacent, with notable contributions from a coalition of early-stage funds and prominent figures in the technology and finance sectors. This fresh influx of capital marks a pivotal moment for Copilot Money as it seeks to expand its reach and refine its product offerings.
Established in 2020 by a former Google engineer disillusioned with existing personal finance tools, Copilot Money has swiftly carved out a niche for itself in the crowded FinTech landscape. The app distinguishes itself through its emphasis on user privacy, ad-free experience, and a meticulously designed interface that aims to simplify financial management. Its core mission is to provide a comprehensive, intuitive tool that enables users to confidently navigate their finances.
The primary use of the newly acquired funds is clear: Copilot Money intends to broaden its platform availability and accelerate the development of its artificial intelligence (AI) and product offerings.
Goalsetter a US financial education platform focused on helping families learn how to spend, save and invest, has raised $9.6 million in a Series A extension round.
The round was led by an affiliate of Edward Jones and MassMutual through its MM Catalyst Fund. Series A investors Fiserv, Webster Bank, Seae Ventures, Astia Fund, and Partnership Fund for New York City also participated.
Goalsetter works with banks and credit unions, providing a white-label platform that lets them offer families an app and debit card combination for children with a host of educational tools and parental controls.
The new funding will be use to target more partnerships with financial institutions and to launch live bank and credit union product implementations to make it easier to add its technology across multiple technology platforms.
#digitalwealth ?#wealthtech #investing
Founded by the investment banker Avion Gray and behavioural economist Samantha Rosenberg , Belong is poised to democratise access to wealth-building for a broader audience, with a keen focus on the millennial generation.
The startup has announced a ￡2.95m in pre-seed funding, marking the largest such round ever secured by female founders in Europe. This achievement was made possible through the backing of Octopus Ventures.
The funding will fuel Belong’s mission to make wealth-building avenues, traditionally reserved for the affluent, accessible to a wider demographic. This includes scaling up the platform’s unique offering and expanding its reach to empower professionally-employed millennials to build substantial long-term wealth.
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Belong’s platform uniquely offers retail investors the option of a low-interest ‘Boost loan’. This feature is designed to amplify the potential of long-term investments in equities by allowing investors to increase their initial investment amount. The strategy leverages the power of compounding, with the loan repayable in manageable monthly installments, thereby making sophisticated investment strategies accessible to a wider demographic.
Belong’s approach to wealth building is particularly relevant in today’s economic landscape. Millennials, despite being the largest demographic, hold a minuscule share of the stock market. Belong is set to change this narrative by tapping into the significant cash savings millennials have, which are often parked in low-yield accounts. The platform not only aims to provide a viable investment avenue but also to instill confidence among millennials to invest for the long term.
JPMorgan Chase says its free Wealth Plan digital money coach has helped customers create more than a million personalised plans in just a year since launch.
Available in the Chase Mobile app and on Chase.com , Wealth Plan gives the bank's 54 million retail customers a full picture of their finances and helps them plan, save and invest.
Users can set and track short-term goals, like a vacation, and long-term goals, such as buying a home or retirement, in real time and get personalised step-by-step guidance and insights.
A goal simulator shows customers how different decisions made today can impact their financial future while customers can also schedule to speak to an advisor right from the tool.
Chase says the tool has proven a hit in its first year, with 10 million customers using it to update plans, get assistance to stay on track and get closer to their goals.
#ESG #sustainable #sociallyresponsible
10.? Paynetics Acquires Novus Neobank: to Amplify ESG Mission
Paynetics, the pioneering embedded finance provider, announced today its strategic acquisition of Novus, the UK’s first-ever “impact neobank.” This landmark deal underscores Paynetics’ commitment to advancing environmental, social, and governance goals while revolutionising the financial landscape with its powerful embedded finance suite.
Through its innovative approach, Novus has upgraded traditional banking by empowering conscious consumers to make a difference while seamlessly integrating financial services with event-driven positive impact initiatives. The unique corporate model allows users to effortlessly contribute to causes they feel emotionally connected to – with every transaction, a portion of revenue is automatically directed to an NGO selected by the customer. Through the Novus app, users can further track the carbon footprint their purchases generate and easily offset them via certified Carbon Removal Projects.
Paynetics will enhance further such offerings while expanding the ESG ecosystem across Europe empowering their clients to push forward ESG initiatives through the corporate embedded finance service for a new and better tomorrow.
#openbanking
Dwolla, a leading provider of account-to-account (A2A) payment services, today announced it has expanded its partnership with MX Technologies, Inc. to make it easier than ever for enterprises to manage money movement.
Dwolla’s recently launched Open Banking Services take advantage of MX’s Instant Account Verifications (IAV) and account aggregation solutions to provide mid- to enterprise-sized businesses with bank verification and balance check capabilities.
Dwolla enables businesses to digitally transform their payments infrastructure through a single API. Dwolla’s modern approach replaces legacy technology with a unified and streamlined solution, improving payment security, data visibility, and the customer experience. Now, Dwolla’s A2A payments are layered with MX’s verifications and aggregation capabilities to better equip businesses to deliver modern, simple, and secure money experiences through a single provider.
Payop, an international payment processor and a payment aggregator, has partnered with Tink, a market-leading payment services and data enrichment platform, to add Pay by Bank to its checkout options.
Payop works with a variety of merchants from small e-commerce stores to large enterprises, offering a unique checkout solution with numerous payment solutions.
Payop is already live with Tink’s Pay by Bank for merchant checkouts, and has seen noteworthy growth. The amount of executed payments increased more than 2.5 times from January to December 2023. Payop and Tink are working together on promoting and growing the adoption of this payment method across Europe. Pay by Bank is available for Payop merchants across Europe including France, Germany, Netherlands, Spain and UK.
Pay by Bank is an online payment method that lets consumers purchase goods and services by initiation payments directly from their bank account to the seller's account. This account-to-account payment method provides a secure and streamlined experience – at low cost – allowing merchants to differentiate themselves from the competition.
#payments #spending #borrowing
ZayZoon, the leading Earned Wage Access (EWA) provider for small and mid-sized businesses, announced it has raised US $15 million in an extension of its Series B financing. This round extension brings ZayZoon’s total Series B funding round to 49.5 million USD. The round was led by Viola Fintech with participation from Intuit Ventures and existing investors Framework Venture Partners, and Export Development Canada (EDC).
This financing will support ZayZoon’s continued growth, innovation, and expansion. This dual backing not only validates ZayZoon's innovative approach to the improvement of financial health but also opens up unparalleled opportunities for collaboration and growth.
Eight months after acquiring credit card startup X1 for $95 million, Robinhood announced today the launch of its new Gold Card, with a list of features that could even give Apple Card users envy.
Robinhood, better known for its brokerage app aimed at the everyday investor, is touting all sorts of benefits with its new card in an attempt to attract users. The card has no annual or foreign transaction fees. However, it will only be available for Robinhood Gold members, which costs $5 a month, or $50 annually. (Gold is a program that offers other benefits like 5% APY on an account’s uninvested brokerage cash.)
Gold Card users can earn 3% cash back on all categories, including restaurants and groceries, and 5% cash bank when booking travel at Robinhood’s new travel portal. That cash back can be transferred to brokerage accounts, which can go toward making investments like stock purchases, the company says. The ability to invest using cash back is the big innovation that X1 developed prior to getting acquired.
Another interesting feature of the Gold Card includes the ability to provide cards for family members. This is the first time that Robinhood has introduced a family-oriented financial product, Robinhood Money General Manager Deepak Rao told TechCrunch. Rao was the founder and CEO of X1 before joining Robinhood in the acquisition.
15.? Home Trust Company and Fairstone Bank : to Merge, Creating the Leading Alternative Lender in Canada
Fairstone Bank of Canada and Home Trust Company announced the signing of a definitive agreement to merge their respective businesses. This transaction will create the leading alternative lender in Canada and boast an extensive Canadian footprint servicing more than 2 million customers with more than 250 branches from coast to coast. The combined business will offer diversified product lines, including residential and commercial mortgages, personal loans, credit cards, retail financing, auto financing, digital lending and consumer deposits. It will also add meaningful competition within the Canadian financial services sector, improving Canadians' access to essential financial services and delivering responsible, accessible and value-driven financial solutions.
The new group will provide services to the millions of Canadians who have been historically underserved and whose financial needs are often overlooked by traditional banks. This segment is large, attractive and growing, underpinned by strong immigration growth and post-pandemic normalization in the number of non-prime consumers. By offering a unique omnichannel model, the combined entity is creating the only alternative lender with a national branch and broker network – complemented by innovative digital capabilities – that customers can rely on for a full suite of responsible lending products.
TD Bank announced the launch of TD Complete Checking, a new product that’s designed to help simplify and modernize the checking experience. Additionally, TD has introduced TD Early Pay, a feature that lets customers receive their eligible direct deposits up to two business days early. These innovative offerings signify TD Bank’s commitment to evolving its services in response to customer feedback, providing greater value, flexibility and control to its customer base.
TD Complete Checking provides customers with an enhanced, streamlined everyday banking option throughout their life cycle and rewards customers with one free linked savings account. The new product also offers free paper statements and basic checks for customers aged 60 and above, and no monthly maintenance fee and $0 non-TD ATM fees for young adults aged 17-23.
Additionally, TD Early Pay is now available to all checking and savings account customers, providing them with greater financial accessibility and control. The feature will be included for customers enrolled in direct deposit and eligible transactions for Early Pay. TD Early Pay is free, no sign up needed, and works for multiple eligible transaction types such as paychecks, tax refunds, government benefits, military pay, and pensions.
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