SixPoint Spotlight

Latin America

Macroeconomics updates

Brazil: Inflation for school break-related items in Brazil rose by 3.81% over the past 12 months, primarily driven by higher prices for food and drinks consumed outside the home. Without these items, the inflation rate would have been 2.7%. Increases in prices of a?aí, sweets, snacks, and restaurant meals contributed significantly. This trend reflects a broader resistance to disinflation in services sectors post-pandemic, impacted by both demand pressures and higher input costs. Source

Mexico: Mexico's economy experienced sluggish growth in the second quarter of 2024, with GDP increasing only 0.2% from the first quarter and 1.1% year-over-year. This represents the weakest quarterly growth since early 2021. High interest rates from the Bank of Mexico have dampened demand, though government spending and a robust labor market prevented a contraction. Analysts expect further slowing as the political transition nears, with new President Claudia Sheinbaum set to take office in October. Source

Financial Technology News

Brazil: LemFi, a leading financial technology platform, has expanded its international payment services to Brazil and Mexico. The platform offers the best exchange rates, zero transaction fees, and quick transactions. LemFi's expansion into the Latin American market aims to support the diaspora's need for reliable and cost-effective financial services. This move follows the company’s significant growth and recent Series A funding, highlighting its commitment to making global remittances easier and more accessible. Source

Mexico: Fintech Futuro, a key player in the financial technology sector, is expanding its operations to Mexico City. This move aims to support fintech investment processes across Latin America by offering advanced solutions and resources to investors. The company emphasizes innovation, transparency, and customer service, aiming to empower investors with the necessary tools and information to navigate the fintech landscape. The new offices will provide localized support and enhance accessibility to fintech products in the region. Source

Asia

Macroeconomics updates:

Singapore: Singapore's economy is projected to grow by 2.2% in 2024, driven by a rebound in exports and steady domestic demand. Despite moderating inflation, maintaining tight monetary policy is essential to anchor expectations. Risks include potential spikes in commodity prices and slower growth among major trading partners, especially China. The Monetary Authority of Singapore is advised to stay vigilant and adjust policies as needed. Fiscal measures focus on long-term priorities like productivity and green transition, alongside support for lower-income households and businesses. Source

India: India's Budget 2024 has been criticized for its inadequate response to the country's severe employment crisis. Critics argue that the budget fails to address the structural issues causing high unemployment and underemployment, lacking substantial measures to generate job opportunities. The focus remains on short-term reliefs rather than long-term solutions, and there are concerns about the effectiveness of the proposed schemes and investments in creating sustainable employment. The response to the employment crisis is seen as insufficient given the scale of the problem. Source

Financial Technology News

India: HSBC India has partnered with Open Financial Technologies to launch FinConnect, a platform aimed at simplifying financial operations for business clients. FinConnect integrates HSBC accounts with over 300 enterprise resource planning systems, automating accounts receivable and payable functions through open banking technology. This partnership is part of HSBC’s “Beyond Banking” initiative, which provides comprehensive solutions and value-added services to startups and small businesses, enhancing efficiency and security in business finance. Source

Singapore: Proxymity and Deutsche Bank are expanding their partnership by deploying their services in the Singapore market. This collaboration aims to enhance the efficiency and transparency of corporate governance processes. Proxymity’s platform will provide real-time digital communication between issuers and investors, while Deutsche Bank will offer its custody and clearing services to streamline the proxy voting process. This initiative is part of a broader effort to modernize and digitize financial market infrastructures. Source

Fintech Fundraising News

Equity Raises:

India: JP Morgan has invested $38 million in Navi Finserv through a landmark Pass Through Certificate (PTC) transaction. This funding will help Navi Finserv, a non-banking financial company, expand its lending portfolio and strengthen its financial position. The PTC transaction represents a significant vote of confidence in Navi Finserv's business model and growth prospects, showcasing the potential for innovative financial instruments to support the growth of financial services in India. Source

Africa

Macroeconomics updates

Nigeria: Nigeria's economic recovery is gaining momentum under President Bola Tinubu's leadership, focusing on structural reforms and economic diversification. Key initiatives include addressing fuel subsidies, enhancing agricultural productivity, and improving infrastructure. The administration is also prioritizing foreign investment and private sector engagement to stimulate growth. Challenges remain, such as managing inflation and ensuring equitable growth, but the government is optimistic about sustaining the recovery trajectory and achieving long-term stability. Source

Kenya: Kenya's rising public debt, now at KSh10.6 trillion (70% of GDP), poses significant risks to its economic stability. Analysts from Cytonn Investments highlight concerns about debt sustainability and increased borrowing costs, with credit rating agencies maintaining negative outlooks. Moody's recently downgraded Kenya's credit score, citing the country's fiscal challenges. The high debt is attributed to debt-financed infrastructure projects and ineffective fiscal policies. With the economic growth projected at 5%, experts warn of potential financial distress and fiscal instability. Source

Financial Technology News

Nigeria: Experts in Nigeria's fintech sector are advocating for increased collaboration to address challenges such as limited access to services for the under-banked and socio-economic issues. At a recent fintech forum, Ochanya Dan-Ugo, Chief Risk Officer of Unified Payment Services Limited, emphasized the importance of data sharing and cooperation among industry players. The discussion highlighted the potential of open banking and the need for infrastructure improvements to enhance financial inclusion, especially in rural areas. Source

Kenya: Mansa has launched trade-finance and cross-border payment services to bridge Africa's funding gap. Utilizing blockchain technology on the Ethereum-based Base platform, Mansa offers efficient financial services, addressing USD limitations and manual processes that constrain business growth. This initiative aims to democratize access to finance for African businesses, providing new liquidity sources and fostering economic expansion. Source

Fintech Fundraising News

Equity Raises

South Africa: TigerBeetle, a financial transactions database, has raised $24 million in a Series A funding round led by Spark Capital. This funding will be used to invest in engineering, expand go-to-market efforts, and develop TigerBeetle's cloud platform. The company's open-source database is designed for high-performance online transaction processing and has seen a surge in community growth and commercial interest. Founded in 2022, TigerBeetle operates across multiple continents with a small team, half of whom are staff engineers. Source

Middle East

Macroeconomics updates

UAE: The UAE and Morocco have finalized the terms of a Comprehensive Economic Partnership Agreement (CEPA), aimed at boosting trade and investment. The agreement will reduce tariffs, improve market access, and foster collaboration in sectors like renewable energy, tourism, and infrastructure. This deal is part of the UAE's broader strategy to enhance non-oil foreign trade, which reached an all-time high of USD 710 billion in 2023. Morocco is one of the largest and most competitive economies in Africa. Source Israel: Oil prices have partially recovered after Israel's military response to Hezbollah's actions. This geopolitical tension has injected volatility into the oil market, which had been experiencing losses. The situation underscores the ongoing impact of Middle Eastern conflicts on global energy prices, with potential implications for supply stability and market sentiment. Source

Financial Technology News

Israel: Israeli fintech unicorn Melio has appointed Nicholas Passarelli as its new Chief Compliance Officer. Passarelli brings extensive experience in compliance to the business-to-business payments platform, which caters to small businesses. Melio, valued at $4 billion after a $250 million funding round in September 2021, aims to strengthen its compliance framework under Passarelli’s leadership to support its continued growth and regulatory adherence. Source

UAE: Network International has partnered with Biz2X to transform SME lending in the UAE by offering embedded financing options. This collaboration will leverage payment transaction data to provide real-time credit assessments, fast-tracking loan processing and approval for SME merchants. The initiative aims to enhance access to capital, streamline the loan application process, and support the growth of small businesses in the region, with services expected to be available by the fourth quarter of 2024. Source

Fintech Fundraising News

Equity Raises

UAE: UAE fintech startup Mamo has secured $3.4 million in funding to expand its financial services for small and medium-sized enterprises (SMEs). The funds will be used to enhance Mamo's product offerings in the UAE and support regional expansion into Saudi Arabia. Mamo aims to streamline payment collections, corporate cards, and expense management for SMEs, helping them save on transaction fees and improve financial management. Source

UAE: UAE-based Watermelon, a food and beverage startup, has raised $4 million in a Series A funding round, giving new investors a 13.8% capital shareholding and valuing the company at $29 million. The investment, led by key investors with Daman Investments as the exclusive fundraising advisor, will be used to accelerate Watermelon's growth, enhance technological offerings, and expand its market presence. This funding aims to solidify Watermelon's leadership in the F&B industry, focusing on improving efficiency, transparency, and sustainability. Source

Chart of the Week

Recommended Long Reads

• 10 fintech trends for 2024 that define the industry's future. Source
• Emerging markets payments handbook. Download