Uber Partners with BBVA to Drive Financial Inclusion, Kyash Will be the First Challenger Bank in Japan, FCA Suggests Ban on Crypto Derivatives

This week (1-5 July) was super exciting and some really interesting developments took place in the FinTech space. Uber is working on driving financial inclusion, the first challenger bank in Japan is emerging, FCA fights crypto derivatives and much much more.

Without further ado, let us dive into what has happened in the financial technology sector this week.This week (1-5 July) was super exciting and some really interesting developments took place in the FinTech space. Uber is working on driving financial inclusion, the first challenger bank in Japan is emerging, FCA fights crypto derivatives and much much more.

Without further ado, let us dive into what has happened in the financial technology sector this week.

ABN Amro Finalizes Container Logistics Pilot on Blockchain

ABN Amro has completed the first instantly financed, door-to-door transport of a container from a factory in Asia to the Netherlands on blockchain-based platform Deliver.

The Dutch bank began work on the container logistics pilot in October last year with the Port of Rotterdam Authority and Samsung SDS. Currently, the physical, administrative and financial streams within international freight distribution steams are carried out in separate flows.

Edwin van Bommel, Chief Innovation Officer at ABN Amro, said:

We are strongly committed to help our clients in their process to fully automate their trade flows. All parties involved in the trade flow will benefit from more effective controls, greater efficiency, transparency and traceability.

With the PoC behind it, the bank says it plans to open up the pilot to multiple shippers from various industries and acting in different trade lanes. 

Standard Chartered Rolls out Digital-Only Bank to Three New Markets

Standard Chartered has prolonged the roll out of its digital-only bank to three new African markets, Botswana, Zambia and Zimbabwe.The next wave of app-based banking services follows launches in Uganda, Tanzania, Ghana and Kenya in the first quarter of the year and C?te d’Ivoire in 2018.

In C?te d’Ivoire the digital bank has exceeded initial expectations with 18,000 new account openings, in Uganda the Bank has seen an eight-fold increase in new account openings, whilst in Tanzania it has signed up more new customers since launching in March this year than in the whole of 2018.

Standard Chartered is expected to continue its digital expansion in African markets with another launch planned in September for Nigeria.

The move represents an attempt by the bank to make up lost ground to telco-based mobile-money services by offering a full panoply of up to 70 online and mobile-only financial products, including money transfers and bill payments, QR code and P2P payments, loan and overdraft facilities, and instant fixed deposits. 

A new offering to the platform comes in the form of SC Keyboard, which allows customers to access a variety of financial services from within any social or messaging platform without having to open the Banking app.

Fidor to Leave UK

German neobank Fidor is to withdraw from the UK market, shutting down its online presence and all social media channels, as the bank struggles to keep an even keel three years on from its fast-souring acquisition by France's BPCE.

Fidor was one of the first breed of new digital banks, establishing a reputation in European circles as a disruptive innovator, utilising a full range of social media, crowdfunding and P2P lending techniques and digital currency services to build its business.

In the summer of 2016, eager to buy some technological savviness for its own digital transformation, the 200-year-old BPCE agreed to pay around €140 million for Fidor.

But two years down the line, talk emerged of a culture clash between Fidor management and BPCE. Despite injecting another €89 million into Fidor in 2018, BPCE appeared to be losing faith in its acquisition, abandoning plans to roll out Fidor in France and instead pumping all of its digital investments into its existing brands.

In a letter to customers, Fidor says it will de-activate all accounts and cancel debit cards from 15 September, citing "uncertainties surrounding the UK market". Log-in Internet access will remain online for a further 15 days, allowing access only to personal documents, including account statements and interest certificates.

NatWest Tests Video Banking Service for Business Customers via Zoom

NatWest is to launch a new video banking channel from which business customers can hold pre-arranged live chats with staff members via their mobile device, tablet or PC.

Customers can have calls with multiple participants from the lender's video banking team who have been trained to handle queries on international trade and cash management, and cash, cards and liquidity products.

The new service will initially be trialed with a limited number of customers and will allow the bank to hold a complete, secure record of every customer interaction for risk and regulatory purposes, compliant with GDPR regulations.

The improvement was developed in partnership with San Jose-based Zoom, after the bank initially worked with the firm to introduce remote video conferencing across its 70,000 staff, before beginning work to introduce the option for customers.

Kyash, Emerging Challenger bank in Japan, Raises $14M

The new era of tech-enabled banks is coming, even in regulation-heavy Japan. Kyash, a FinTech company with visions on becoming Japan’s first challenger bank, this week has raised $14 million to continue its expansion.

Kyash isn’t a bank yet, but it is currently applying for a host of licenses in Japan that could allow it to offer banking-style features, including checking accounts, ATM withdrawals and money remittance. Right now, it is a payment app that offers a connected Visa card in the style of Monzo, N26, Revolut (which has a Japan license) and others of that ilk.

The startup was founded in 2015 by Shinichi Takatori, a former banker and management consultant who saw the potential to merge tech and finance.

The company took some time — two years — before it released a consumer product, but it quickly tied up with Visa to offer a prepaid debit card that connects to the Kyash app. That provides benefits like instant payment notifications, clear balance and lower fees for overseas spending, while costs are borne by merchants rather than users. They might seem elementary today, but they are still not standard among Japan’s traditional banks.

The $14 million investment is co-led by Goodwater Capital, a U.S. investor that has backed fintech startups like Monzo, Stash and Toss in Korea, and Mitsubishi UFJ Capital, the investment arm of Japan’s largest bank.

Mitsubishi’s involvement means that Kyash counts Japan’s three largest banks as investors, with SMBC and Mizuho having previously put money into the company. Others that took part in this Series B include Toppan Printing, JAFCO and Shinsei Corporate Investment Limited.

Sweden's Swish Trials In-store Payments

Sweden's popular mobile P2P app Swish is moving into in-store payments, running a pilot trial of Nets' Bluetooth checkout technology at two restaurants owned by one of the country's leading corporates, cantina.

Until now, Swish has mostly been used for account-to-account transactions and, more recently, ecommerce payments. Now, the popular payment app is working with Nets to expand into the retail and service sectors by piloting in-store mobile payment functionality. 

P?r Ekroth, Marketing Manager of Swish said:

Seven million Swedes walk around with the Swish app in their pocket, and it’s clear that the demand for easier in-store payments is increasing. As such, we are pleased to offer mobile payments functionality to our customers.

For the trials, Swish will be tethered to a Bluetooth module developed by Nets that provides an NFC-like ‘tap and pay’ experience for consumers. Integration with merchants’ systems requires only the addition of a ‘Bluetooth box’ to Nets payment acceptance terminals. 

The in-store payments functionality also enables better loyalty programmes, as Bluetooth technology opens up use cases such as real-time, geo-tagged offers. 

Nets already provides this Bluetooth feature to Danish merchants, enabling them to accept in-store payments from locally issued wallets.

Currencycloud Raises ï¿¡32M

London-based cross-border payments business Currencycloud has raised ï¿¡32 million in the first part of a Series E funding round, according to TechCrunch.

Citing sources and regulatory filings, TechCrunch says the ï¿¡32 million is likely to be the first tranche in the round, with more money to come within the next couple of months ahead of a formal announcement.

Goldman Sachs could be leading the round, with existing investor GV (formally Google Ventures) joining. Banco Santander and its corporate venture fund is also in the frame.

Currencycloud's suite of APIs is used by a host of big names - including Visa, Klarna, Standard Bank and Revolut - to enable international money transfers.

Uber Partners with BBVA to Drive Financial Inclusion

Uber is tapping the power of Open Banking to provide unbanked drivers with access to a digital account from BBVA within its mobile app in Mexico. The deal will see the bank in Mexico make its services available on a third-party application for the first time.

BBVA's digital account is linked to a Mastercard ‘Driver Partner Debit Card", to which payments are disbursed. Additionally, users will be able to access loan products from within app and discounts and reimbursements for gasoline purchases payed by card.

Carlos López-Moctezuma, Head of Open Banking at BBVA, says the alliance is a significant milestone in the bank's Open Banking programme:

For the first time we are offering a BBVA product that will ‘live’ in a third party’s platform. In other words, we are bringing the bank to our partner, who in turn is bringing us to their drivers and delivery partners, so that they can take advantage of all the benefits that the bank has to offer, all with a single click.

Digital Receipt Player Sensibill Raises $31.5M

Sensibill, a Toronto-based AI-powered digital receipt startup targeting freelancers and small business owners, has raised $31.5 million in a Series B funding round joined by National Bank of Canada. 

The round, led by AI-focused venture fund Radical Ventures, and joined by Information Venture Partners and First Ascent Ventures, brings Sensibill's total financing to $46.5 million.

Founded in 2013, Sensibill works with banks such as TD and Scotiabank to incorporate its digital receipt technology into their apps, enabling personal and business customers to manage line item receipts from their phones.

The platform uses machine learning to structure receipt data and give both banks and their customers rich insights such as product information, return policy tracking and auto-categorisation.

Since its 2017 Series A round, the firm has doubled its headcount, opened a London office and has now won more than 30 bank deals in Canada, the US and UK, many with Tier 1 players such as RBS.

FCA Suggests Ban on Crypto Derivatives

The UK's financial services watchdog is proposing a ban on cryptocurrency derivatives for retail investors in order to prevent them experiencing large losses in financial instruments they do not understand.

The Financial Conduct Authority (FCA) has focused on derivatives linked to crypto-assets, citing their extreme volatility, difficulty in valuation and the limited understanding of these products among retail consumers.

The regulator's fear is that retail investors may "suffer harm from sudden and unexpected losses if they invest in these products" according to executive director of strategy and competition at the FCA Christopher Woolard. 

Most consumers cannot reliably value derivatives based on unregulated crypto-assets. Prices are extremely volatile and as we have seen globally, financial crime in crypto-asset markets can lead to sudden and unexpected losses. It is therefore clear to us that these derivatives and exchange-traded notes are unsuitable investments for retail consumers (Woolard)

The FCA believes that a ban would save consumers between ï¿¡75 million and ï¿¡234 million per year by preventing fraud and unexpected losses. and Woolard said that the FCA "will act when we see poor products being sold to retail consumers".

Should the proposition come to fruition it could mean a ban on any exchange-traded notes, futures and options and contracts for difference linked to crypto-assets. 

The FCA's comments come at a time when regulators around the world have focused on crypto-assets in the wake of Facebook's announcement around its Libra cryptocurrency project. Woolard himself has warned Facebook that Libra will face intense regulatory scrutiny. 

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About: I am a business developer, sales professional, FinTech strategist, as well as Cryptocurrency and Blockchain enthusiast. I'm highly passionate about Financial Technology and Digital Innovation, and strongly believe that it will change the world for the better. Apart from my daily job at a global payments startup where I'm leading company's expansion into Europe , I'm an active member of FinTech community and a TechFin evangelist.

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