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InstaReM – International Remittances & Fintech Weekly Roundup

Weekly Round-up (11 March –17 March 2019)

The week of 11-17 March saw continued action in the international money transfers and fintech universe with Mastercard acquiring cross-border remittances firm Transfast, a Wall Street analyst predicting billions in additional revenue from ‘Facebook Coin’, PayPal’s Xoom service raising cross-border remittance cap to India to US$ 50,000, Western Union testing a Ripple solution for cross-border money transfers and The Philippines and Nepal reporting increase in inward remittances.

Mastercard is Acquiring Transfast

Mastercard has dropped its Earthport bid and instead acquired cross-border account-to-account money transfer network Transfast. Transfast will be used to improve its compliance capabilities and offer foreign exchange tools. Financial details about the deal were not disclosed. The buyout will complement Mastercard’s existing suite of payment solutions. The deal is likely to expand the company’s connectivity worldwide in the account-to-account space, enhance compliance capabilities and enable it to offer superior foreign exchange tools. Mastercard’s Mastercard Send solution for business-to-business (B2B) and person-to-person (P2P) payment services is already supported by Transfast. Consequently, the deal will expand the company’s cross border business.

Facebook’s “Crypto” Currency Expected to Add Up to US$19 bn in Revenue

Facebook is reportedly developing a cryptocurrency that could be part of a multibillion-dollar revenue opportunity, Barclays internet analyst Ross Sandler said in a note to clients last week. Sandler forecasted as much as US$19 bn in additional revenue by 2021 from “Facebook Coin.” Sandler gave both an upper and lower estimate of the opportunity presented by the launch of the new digital currency. Whilst not quite the almost US$20 bn upper estimate, the internet analyst’s conservative reckoning was still an impressive US$3 bn over the same two-year period. Sources reported by the New York Times claim that the social network plans to initially make its stable-coin available through its instant messaging application, WhatsApp. However, Facebook itself is yet to detail the project.

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PayPal Hikes Cross-Border Remittance cap to India to US$50,000  

PayPal has increased the limit of cross-border remittances to US$50,000 from US$25,000 in 2018 and US$10,000 in 2017, to keep up with demands of US customers, particularly the NRI community in North America. With a higher disposable income, the average NRI is sending more money home than before. With customers getting more tech-savvy, cash-based wire transfers are declining. By raising Xoom’s transfer limits, PayPal will be able to accommodate a broader base of remittance customers. The company hopes this move will allow it to take customers from Western Union and MoneyGram, which currently dominate the global remittance market. Established in 2001 and acquired by PayPal in 2015, Xoom, PayPal’s international money transfer service, has been opened in over 30 countries, including India, Canada, France, Germany, and UK.

Western Union Continues to Test Ripple’s Solutions for A Potential Partnership   

During the World Economic Forum in Davos last week, Western Union’s CEO Hikmet Ersek said that the company is not done yet exploring whether Ripple’s solutions can enhance the company’s settlement system. “The main reason for [the partnership] was optimizing our settlement system, to really manage the volatility. We tested with Mexico, one of our biggest corridors – the US to Mexico, dollars to pesos,” he said. Ripple has some powerful solutions to offer for cross-border payments, and this is what will make more banks and financial institutions ditch the traditional payments system and move towards more innovative solutions. Euro Exim Bank has already made this move and ditched SWIFT in favor of Ripple’s XRP-powered xRapid.

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OFW Cash Remittances up January 2019

Remittances sent by expatriate Filipinos to their local beneficiaries rose slightly in January, thanks to increased volumes sent home by both land- and sea-based overseas workers. The Bangko Sentral ng Pilipinas (BSP) Gov. Benjamin Diokno last week that personal remittances from the country’s workers stationed abroad grew by 3.4% year-on-year in January 2019 to reach US$2.75 bn from US$2.66 bn in the same period last year. By country source, the United States registered the highest share of overall remittances at 35.5 percent, followed by Saudi Arabia, Singapore, United Kingdom, United Arab Emirates, Japan, Canada, Qatar, Hong Kong and Kuwait.

Remittance Inflows into Nepal up 28.5%

Workers’ remittances in the first seven months of the fiscal year swelled 28.5% year-on-year, providing a much needed cushion to Nepal’s depleting foreign exchange reserves. During the same period last year, remittance inflows had inched up 1.7%. According to the latest macroeconomic report released by Nepal Rastra Bank, the country’s central monetary authority, the money sent back by Nepalese migrant workers in different countries totalled NPR 515.55 bn during the period mid-July 2018 to mid-February 2019, despite a sharp drop in worker departures. Industry experts attributed the surge in remittance to the increased use of formal channels by migrant workers to send their earnings home. The practice of using informal channels like hundi to transfer money has decreased recently.

Listen to our February 2019 Fintech Monthly Podcast here.     

Weekly Round-up (04 March – 10 March 2019)

Action continued in the international money transfers and fintech universe during the week of 4-10 March with MasterCard announcing to drop its bid for Earthport, WorldFirst announcing acquisition of CurrencyVue, UK fintech major Revolute attracting some bad press and UK’s FinTech body Innovate Finance launching an educational initiative Fintech for Schools. Meanwhile, Remittance and Fintech firms worldwide took note of the women’s contribution to fintech on the International Women’s Day.

Mastercard Drops Bid for UK’s Earthport, Agrees to Buy Transfast

Global payments giant Mastercard announced its offer window to buy Earthport had lapsed, which potentially clears the way for rival Visa to make a bid for the British cross-border payments company. Earthport has been witness to a bidding battle between Mastercard and Visa since last December. The company, which had earlier backed Mastercard’s bid, most recently urged shareholders to accept Visa’s higher offer. Visa made a surprise £198m bid for Earthport over the festive season. But Mastercard tried to outbid its rival with its £233m bid, forcing Visa to return with an improved £247m package. Mastercard, meanwhile, has announced to enter into an agreement to acquire Transfast, a global cross-border account-to-account money transfer network. Transfast covers over 125 countries across Asia, Europe, Africa, Americas and Australia. Transfast is expected to complement Mastercard’s wide range of payment solutions by increasing worldwide connectivity in the account-to-account space, enhancing compliance capabilities and offering more robust foreign exchange tools.

WorldFirst’s CurrencyVue Takeover Signals B2B Payments Push

Payments fintech WorldFirst announced successful acquisition of the Australian CurrencyVue platform last week. CurrencyVue has been developing a unique platform that integrates with global ERP and well-known accounting systems to provide users with a real-time view of their international payments and currency exposures. The new capabilities will enable WorldFirst’s SME and online seller clients to integrate their international transactions and exposures with leading platforms such as Xero, Netsuite and Quickbooks. The platform also enables businesses to automate payments of foreign currency invoices. The integration of CurrencyVue’s platform means businesses will have access to a holistic view of their finances, including foreign exchange commitments, and an ability to manage these through direct access to WorldFirst’s hedging products. WorldFirst itself has been acquired by Ant Financial in a US$700m deal last month.

Fintech Firm Revolut Hit by Slew of Negative News  

Revolut, the UK money-transfer fintech unicorn, hit the headlines for all the wrong reasons last week.

In early March, Revolut confirmed that its CFO Peter O’Higgins had resigned after a Daily Telegraph report revealed that Revolut switched off an AML system. As a result, thousands of transactions passed through Revolute’s digital banking system without having been fully checked for sanctions compliance. However, Revolut has denied the report, saying this was part of a “systems enhancement project” being tested in parallel with other compliance controls.

In another news, the London Police received a complaint from a Revolut customer about the length of time it took to transfer £70,000 after bank details were incorrectly entered at the payment stage. However, Revolut said that there is no fraud investigation being undertaken by the police.

Also, claims that Revolut has links with the Russian government have been causing controversy in Lithuania. Lithuanian parliament’s budget and finance committee has accused Revolut of being involved with the Kremlin. The Revolut CEO has denied that his company has links to the Kremlin.

Meanwhile, Wired magazine ran a feature on what it called “the human cost” of Revolut’s rise. The story detailed people being asked to work for free as part of job applications, excessively long hours, a culture of “hitting targets at all costs”, and high staff turnover. Revolut has pushed back, saying post that it has already addressed the issues raised in the Wired article, saying that “the allegations in the media over the past week are not an accurate reflection of the company that we are today.”

UK FinTech Body Launches “FinTech for Schools” Initiative

Innovate Finance, an advocacy group for the UK Fintech industry, has launched the “FinTech for Schools Initiative,” seeking to inspire the next generation of Fintech leaders innovators. FinTech for Schools is an important piece of Innovate Finance’s Skills and Talent work, which aims to support a future domestic pipeline of talent as well as showcasing the various skills initiatives of its members in one, easily accessible place during a challenging time politically as Brexit nears. The FinTech for Schools campaign is designed to encourage young people to understand the increasing importance of digital skills in the workplace, with an emphasis on ensuring the sector is appealing to girls. Approx 76,000 people are employed in the UK fintech sector and there are 1,600 UK companies. Out of that, 42% of the workforce is from overseas. However, only 6% of UK deals had a female founder – and that represented a mere 3% of total capital invested in UK fintech in 2018.

Women in Fintech  

On the occasion of the International Women’s Day (IWD) on 8th March last week, fintech firms and associations across the globe took stock of contribution of women in Fintech universe while promising to do more for them.

A study commissioned by WorldRemit showed that the gender gap among senders of remittances to the Philippines narrowed in the last four years, even as female overseas Filipino workers (OFW) tend to earn less than males. The survey showed that the number of female OFWs who sent money home made up 35% of WorldRemit’s clients in 2018, up from just a 25% share in 2014. InstaReM revealed that migrant women in the UK, despite being the primary source of care for their families back home, pay up to 20% more than men to transfer money abroad.

Aside from the gender pay gap, women also face other challenges. Female entrepreneurs often have problems accessing mentorship and even have a difficult time looking for venture capital. Innovate Finance’s annual Venture Capital Investment Report revealed that female founders make up just 17% of Fintech companies and only 3% of the $1.7b UK VC FinTech investments made in 2018 went to businesses with a female founder. Global payments fintech PayPal noted that women make up nearly half the American workforce and are steadily outpacing men in educational achievements and entrepreneurship, and the number of women-owned firms grew 45% between 2007 and 2016, a rate five times faster than the national average. Meanwhile, 20 women in the India’s Fintech industry were awarded the ‘Women in FinTech Awards (WIFA)’ as part of the third edition of fintech conclave ‘Fintegrate Zone’ in Mumbai. The WIFA aspires to raise awareness around women’s contribution to the ecosystem, and to encourage more women to bring a real change.

Listen to our February 2019 Fintech Monthly Podcast here.     

Weekly Round-up (25 February – 03 March 2019)

The week of 25 February-3 March saw continued action in the International Money Transfers and Fintech universe with ACI acquiring Western Union’s US bill pay business, a New York Times report on update of Facebook’s cryptocurrency plans, Tradeshift announcing a new app integration from TransferMate Global Payments, China’s Ping An Insurance planning IPO of its fintech unit, reports of Japan’s big banks ending international cash remittances and Korean banks being ordered to open up payment systems to fintech firms. Meanwhile, fintech investments continue to boom in China and HK despite the looming US-China trade war.

ACI to Purchase Western Union’s Speedpay Business

Global remittances giant Western Union and ACI Worldwide, the provider of real-time electronic payment and banking solutions, entered into an agreement last week for ACI to acquire Speedpay, Western Union’s American bill pay business, for US$750 mn. The combined ACI-WU business will service over 4,000 customers across the US and have reach that expands into consumer finance, insurance, healthcare, higher education, utilities, government and mortgage. Divesting the Speedpay business allows WU to concentrate its resources on its cross-border money movement strategies and monetise a non-core asset. The Western Union roadmap is on cross-border, cross-currency fund flows done digitally and over mobile devices, well beyond what is considered today as WU’s firm hold on the global remittance space. The transaction is expected to close by the end of the second quarter of 2019.

‘Facebook Coin’ Coming in First Half of 2019: The New York Times

Facebook is edging closer to launching its own cryptocurrency, with a rollout expected this year, according to The New York Times. Some of the world’s biggest internet messaging companies are hoping to succeed where cryptocurrency start-ups have failed by introducing mainstream consumers to the alternative world of digital coins, the New York Times said. Facebook is keeping its cryptocurrency plans under wraps, even from the other company employees. The social media giant silos off its secretive cryptocurrency team in an office that requires entirely different key-card access so that other Facebook employees can’t enter. In December, Bloomberg reported that Facebook was planning to roll out a stablecoin for WhatsApp. However, the NYT report revealed that the company plans to integrate the cryptocurrency into two of its other major properties – Instagram and Messenger, which would give the coin an unprecedented level of exposure. The audience of the three apps reaches 2.7 bn monthly users.

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Tradeshift Adds TransferMate App to Ecosystem

Tradeshift, a supply chain payments and marketplaces major, announced a new app integration from TransferMate Global Payments, which will make it easier for global commercial buyers and sellers to digitally connect along every transaction phase. The new solution automates same-day cross border payment services from commercial transactions anywhere in the world more accurately, securely, and with lower fees than traditional correspondent banks. The easy integration of new app by TransferMate takes away the issue of complexity while increasing speed, reconciliation and transparency. It also saves time by giving Tradeshift customers the ability to finish off all last-mile payments across the border.

Ping An Plans IPO of Fintech Unit at US$8 bn Value

Ping An Insurance, China’s largest insurer, is gearing up for an IPO of its OneConnect unit that could value the financial management portal at about US$8 bn, according to a Bloomberg report last week. Ping An is targeting to list OneConnect in Hong Kong as soon as the second half of this year, and the share sale could raise roughly US$1 bn. The insurance giant initially had a fundraising goal of as much as US$3 bn last year, before an increasingly volatile market forced it to push back the listing plan. OneConnect offers services to small to mid-sized financial firms, having partnered with hundreds of banks and more than 1,800 non-bank financial companies. The company has a US$ 650 mn Series A financing round under its belt, which valued the company at US$7.4 bn.

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Japan’s MUFG and Mizuho to End Overseas Cash Transfers  

Japan’s top banks MUFG Bank and Mizuho Bank will soon stop offering international cash remittances at branches in a move to combat money laundering. MUFG Bank, which currently offers international cash remittances for ¥ 5,000 to ¥ 5,500 (US$ 45-50) from its branches, will stop on June 3. Senders will have to remit money from their accounts, and the bank will encourage the use of online banking by keeping that remittance fee at ¥ 2,500. Unlike online transfer services, physical remittances involve little in the way of compliance or customer identity checks. Over-the-counter cash remittances do not go through a rigorous compliance process, leading to the possibility of misuse. Many regional banks have already stopped remitting cash overseas.

Korean Banks’ Payment Networks to Be Opened to Fintech Firms

Korea’s Financial Service Commission (FSC) is introducing new rules that will force the nation’s banks to open their payment systems to third party fintech firms in a move designed to increase competition and promote innovation in the sector. The current financial payment network has a closed system accessible only by banks. With the open banking system, consumers will be able to manage and control their multiple bank accounts in one place and make easy and fast money transfers. Fintech firms registered as payment service providers would be required to pay banks commission fees that may be about 90% lower than the current rates for accessing their customers’ transaction data because they won’t need to enter into a partnership with each bank under the open banking system.

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Fintech Booming in China and HK Despite Looming Trade War

Global investment in fintech ventures more than doubled in 2018, to US$ 55.3 bn, led by a surge in funding in China and strong gains in several other markets as investors placed larger bets in more mature startups, according to Accenture analysis of data from CB Insights. China accounted for 46% of all fintech investments in 2018. More than half of China’s fintech investment came from the record US$14 bn funding round in May of Ant Financial, which manages the world’s largest money market fund but is perhaps best known for its Alipay mobile payments service. Despite the fact that U.S. authorities have raised their scrutiny of foreign-backed investments and pulled the plug on some Chinese-backed deals, the value of deals in China increased by ninefold to US$ 25.5 bn — almost as much as the US$26.7 bn from all fintech investments globally in 2017.

Listen to our February 2019 Fintech Monthly Podcast here.

 

Weekly Round-up (18 February – 24 February 2019)

Action continued in the international money transfer and fintech universe with Japan’s financial services regulator reportedly planning to deregulate non-bank overseas money transfers, Apple & Goldman Sachs teaming up for a credit card, Transferwise reportedly planning to sell a stake that would value the fintech at £3bn+, Chinese insurer Ping An starting fintech operations in Indonesia, EMQ receiving FSC approval to offer cross-border remittance services for migrant workers in Taiwan, digital payments major bill.com announcing to eliminate wire transfer fees for businesses and TerraPay collaborating with a local bank for instant remittances in Sri Lanka.

Japan Allows Fintech Payments Specialists to Compete with Banks

Japan is set to allow non-bank companies to handle money remittances of over ¥1 mn (US$ 9,000), lifting a limit that has prevented fintech start-ups from providing faster and cheaper services in an area dominated by the banking sector. The planed moved is aimed at promoting the market entry of fintech companies, thereby reducing remittance charges and speeding up international money transfers. Japan’s Financial Services Agency plans to grant money transfer licenses covering larger transactions to “suitable” non-banking firms that meet minimum capital requirements. Further announcements are expected, but it is estimated that the cap will be removed by mid-2021. The decision is likely to herald massive interest in fintech money transfer specialists, particularly among small and medium-sized Japanese businesses which have so far been unable to take advantage of the much cheaper transfers these firms provide due to the limitation on transaction size.

Apple, Goldman Sachs Team Up on Credit Card Paired With iPhone

Tech leader Apple and banking major Goldman Sachs plan to issue a joint credit card paired with new iPhone features that will help users manage their money. The card will be rolled out to employees for testing in the next few weeks and officially launch later this year, reported Wall Street Journal. The companies hope to attract cardholders by offering them extra features on Apple’s Wallet app, which will let them set spending goals, track their rewards and manage their balances. The card could help both companies broaden their revenue away from their traditional core products. Apple has been sharpening its focus on its services business, including mobile payments and music streaming. Goldman, for whom this is the first card product, is reportedly adding customer-support call centers around the country and building an internal system to handle payments.

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TransferWise Share Sale to Value UK Fintech at £3bn

London fintech TransferWise is reportedly planning to sell a stake that would value the fintech at more than £3bn or approx. US$ 4 bn. The company has appointed Goldman Sachs to sell about US$ 200mn (£153mn) in new shares on behalf of existing investors, according to Sky News. The deal, if completed, will cement the company’s position as UK’s top tech start-ups, with an IPO likely to be on the medium-term agenda. TransferWise’s supposed $4bn valuation would be more than twice the level at which it last sold new shares about 18 months ago.

China’s Ping An Forays Into Indonesian Fintech Market  

China’s largest insurer Ping An has announced its expansion into Indonesia’s fintech market with the launch of its subsidiary OneConnect in Southeast Asia’s largest market. OneConnect aims to enable local banks and financial institutions to accelerate their efforts in digitization of financial services and move towards a more inclusive financial industry. OneConnect is also known for its blockchain solution – it is the technology provider for Hong Kong Monetary Authority’s trade finance blockchain project Hong Kong eTrade Connect. Its collaboration with Asparindo in Indonesia is expected to see OneConnect conducting training workshops and performing site visits at the markets to help users.

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EMQ Unveils Cross-Border Remittance Service for Taiwan’s Migrant Workers

EMQ, a cross-border settlement network in Asia, announced last week that the Financial Supervisory Commission (FSC) of Taiwan has approved its application to offer cross-border remittance services for migrant workers in Taiwan. As the first fintech startup to be accepted into the Taiwan’s Regulatory Sandbox, EMQ will within the FSC prescribed timeline, provide a more convenient and lower cost remittance services for migrant workers sending money home to Vietnam, Indonesia, and the Philippines. The money transfer can be done through smartphones. Among the payout options are instant cash pickup, deposit to partnered banks and mobile wallet, and home delivery of cash.

Bill.com Eliminates Wire Transfer Fees for International Payments    

Bill.com, the digital business payments company, announced last week to eliminate wire transfer fees for businesses paying electronically in local currencies using its International Payments solution. For small & medium businesses and mid-market companies, Bill.com International Payments streamlines the business payments process, making cross-border payments easier. Unlike banks or other international payment providers, Bill.com offers control with automated approval workflows and time savings by syncing with leading accounting software. Bill.com International Payments solution enables the company to pay its contractors, who are located all over the world, in a timely manner.

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TerraPay Takes Cross-Border Payments to Sri Lanka

Mobile payments switch TerraPay has partnered with Pan Asia Bank, which enables TerraPay’s partners to make cross-border money transfer to all bank accounts in Sri Lanka. With this, Sri Lankan migrants worldwide, through TerraPay’s partner outlets/website/mobile-app, can send money to their family back home, instantly by transferring it to their bank account. TerraPay is a real-time, low value payments network, which connects all financial instruments globally. TerraPay’s interoperability engine enables customers to send and receive real-time transactions across diverse payment instruments, platforms and regions. TerraPay enables more than 1.5 bn bank accounts and 200+ mn mobile money wallets in over 50 countries to receive real-time cross-border money transfers.

Listen to our January 2019 Fintech Monthly Podcast here.

Weekly Round-up (11 February – 17 February 2019)

The week of 11-17 February 2019 saw continued action in the international money transfers and fintech universe with top US bank JP Morgan announcing its own cryptocurrency and the Chinese fintech giant Ant Financial completing the takeover of money transfer firm WorldFirst. Among new funding updates, London-based digital payments fintech Rapyd raised US$ 40 million and the Philippines-focused money transfer fintech SendFriend raised US$1.7 million. Among other updates, UAE-based money transfer firm Finablr’s UAE Exchange and Unimoni went live on the RippleNet and Remittances to the Philippines reached all-time high in December 2018. Meanwhile, research from InstaReM concluded that the imminent Brexit has already created a dent in the remittances out of the United Kingdom.

Ant Financial Completes WorldFirst Takeover

Ant Financial Services Group, the world’s most valuable financial-technology startup, is acquiring the UK-based money-transfer company WorldFirst for more than £500 mn (around US$ 640 mn), marking a successful western deal for the firm which saw a US purchase blocked by regulators last year. Media reports first surfaced in December that Ant Financial was in talks to purchase WorldFirst. This isn’t an average multi-million dollar acquisition. Ant Financial ran into problems when its plan to purchase the remittance service provider MoneyGram was blocked by the US regulators on national security grounds.

JPMorgan Launches JPM Coin, World’s First Bank to Launch Cryptocurrency

JP Morgan became the first major US bank to introduce its own digital token for real-world use, the latest step in Wall Street’s evolving approach to the blockchain technology. The biggest US bank said it developed a prototype digital coin, to be called JPM Coin, that it plans to use to speed up payments between corporate customers. While some experts questioned the broader impact of a dollar-pegged coin available only to JP Morgan clients, others said the bank’s involvement lends legitimacy to cryptocurrencies. JPM Coin is considered to be a direct threat to one of the most visible blockchain companies, Ripple, and the digital currency used in its products. However, JPM Coin has some key differences to Ripple’s XRP. It’s “exclusively for institutional customers” and in will be based on a private, permissioned blockchain Quorum—a far cry from the public, blockchain used by bitcoin.

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London Fintech Rapyd Raises £31.2 mn

Rapyd, a global fintech-as-a-service platform that enables businesses and consumers to pay or be paid however they choose, using any payment method or cash for local and cross-border e-commerce, announced a US$ 40 mn financing round last week. The Series B is co-led by Stripe, the payments giant that is now valued at US$22 bn, as well as General Catalyst, one of Stripe’s biggest backers. Founded in 2016, Rapyd describes itself as a mobile-first financial network that makes the world’s “favorite ways” to pay and be paid instantly available through a single API and SDK. With this investment, Rapyd will seek to expand its technology platform for in-country or cross-border commerce requiring local payments, such as bank transfers, e-wallets, or cash for local acceptance and payouts.

Remittance Startup SendFriend Secures US$1.7 mn Funding   

SendFriend, the digital remittance service to send money to the Philippines, announced last week that it has raised US$1.7 mn to better enable the Overseas Filipino Workers to securely transfer USD to PHP at the lowest rate available. The funding comes from MIT Media Lab, Barclays, the Mastercard Foundation, Ripple, Techstars, Mahindra Finance, 2020 Ventures, and 8 Decimal Capital. The funds will be used to build out the team, focus on community engagement, and marketing efforts. In addition, SendFriend is leveraging Ripple’s xRapid to create a seamless money transfer experience that enables the remittance company to convert USD to XRP to PHP in a matter of seconds. At US$ 30 bn, Philippines’ remittance industry is the third largest globally, next to China (US$64 bn), and India ($72 bn).

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UAE: Financial Company Finablr Joins Ripple

UAE-based Finablr, a Payments and Forex platform, announced last week that its network brands UAE Exchange and Unimoni are now on RippleNet. Finablr had partnered with one of the largest bank of Thailand, Siam Commercial Bank which is a Ripple partner to provide services on RippleNet. Now, it is planning to expand its services to other countries. With this, UAE Exchange and Unimoni become the first in their category in the Middle East to have adopted blockchain technology to process transactions. And Finablr is seeking to capitalize on just that. Finablr also acquired a digital payments firm TimesofMoney in order to capitalize on the e-commerce growth, in November 2018.

Philippine Remittances Hit New Record in December 2018

Cash remittances in December in 2018 grew 3.9% year-on-year, reaching an all-time high of US$2.8 bn, data from the Bangko Sentral ng Pilipinas released last week showed. Personal remittances reached USD32.2 bn in 2018, the highest annual level to date. “Cash remittances in 2018 remained strong amid political uncertainties across the globe. This is evident in Asia, the Americas and Europe, which grew annually by 12.3 percent, 9.7 percent, and 7.7 percent, respectively,” the Bangko Sentral said. The bulk of cash remittances for the year came from the US, Saudi Arabia, United Arab Emirates, Singapore, Japan, the United Kingdom, Qatar, Canada, Germany and Hong Kong. Cash remittances from these countries accounted for almost 79 percent of total cash remittances.

Brexit Dents UK Remittance Market

Research conducted by digital cross-border payment provider InstaReM, one of Singapore’s hottest fintechs in 2019, revealed that 44% of the UK migrants are now sending less money ‘home’ as a result of Brexit chaos and a drop in value of sterling. The survey found that nearly half (48%) of money that is sent home is for food and healthcare for their families. They simply don’t get as much for their pound as a result of the economic uncertainty in the UK. It revealed that 36% now sacrifice a greater proportion of their income to continue to provide the same level of support they did for their families before. InstaReM will help protect migrants against the implementation of Article 50 with its Brexit50 offer which gives users a transfer bonus of £50 when remitting money from the UK to families abroad.

Listen to our January 2019 Fintech Monthly Podcast here.

Weekly Round-up (04 February – 10 February 2019)

Action continued in the international remittances and fintech universe during the week of 4-10 February with Forbes releasing its much-awaited Fourth Annual Fintech 50 List, Visa upping its offer to buy Earthport in its ongoing battle with Mastercard, Western Union reporting its Q4 and FY 2018 results, Swedish Fintech Tink raising US$ 64 mn at a valuation of US$ 270 mn, Germany’s Raisin raising US$ 114 mn, resigning of Transferwise’ Head of Asia-Pacific expansion and Ripple announcing 11 new University partners for its Blockchain Research Initiative.

Forbes Releases Fourth Annual Fintech 50 List

The leading American business magazine Forbes released its much-awaited fourth annual Fintech 50, a list of 50 innovators who are changing how people save, spend and invest, last week. 19 of the 2019 Fintech 50 are valued at US$ 1 bn or more. 20 startups made their first appearance on this list. 12  of this year’s Fintech 50 companies are involved in payment technology, including the most valuable fintech, Stripe, which is worth US$22.5 bn. The notable crypto/blockchain-related fintech companies that made the list include Ripple, Coinbase, and Circle. The other 3, lesser-known, crypto-related fintech companies are Gemini, Bitfury, and Axoni. Among the notable ones who were left out this year include the company Blockchain, which was described as the world’s most popular cryptocurrency wallet by Forbes last year, private blockchains creator Chain, Crypto compliance provider Chainalysis, Crypto exchange ShapeShift, blockchain & smart contracts platform Symbiont, and the Bitcoin wallet Xapo.

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Visa Ups offer for Earthport in Battle with Mastercard

Visa sweetened its offer for payment company Earthport to about £247 mn pounds (US$319.84 mn), pushing past rival Mastercard’s earlier bid and setting up a showdown for the assets. A unit of Visa offered 37 pence in cash for each Earthport share, a 23% premium to its initial bid and 12% higher than Mastercard’s offer last month. Having backed the earlier Mastercard bid, Earthport has done an abrupt about-turn to welcome Visa’s new valuation. Mastercard said it was considering its options and urged Earthport shareholders to take no action in response to Visa’s announcement last weel. Both Visa and Mastercard have cited the same reason for their interest in Earthport – the deal would allow it to expand its cross-border network service.

Western Union Reports Q4 &  FY 2018 Results; Digs Deeper into Digital

Western Union reported financial results for Q4 2018, and FY2018 and provided its financial outlook for 2019 last week. The money transfer giant’s Q4 earnings met analyst expectations on adjusted earnings per share, but came in slightly below estimates on revenue. However, WU CEO Hikmet Ersek remained positive and forward-focused on the result. “We feel confident about our operations and business. In 2019, we will continue to execute our strategy to deliver strong digital expansion, offer our cross-border platform to new payments areas and generate additional operating efficiencies,” Ersek said.

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Swedish Fintech Start-up Tink Raises US$ 64 mn at US$ 270 mn Valuation

Swedish fintech start-up Tink raised €56 mn (US$64 mn) in a funding round aimed at fueling its expansion plans. The funding exercise values Tink at approx. €240 mn (US$273 mn), CNBC reported last week. Founded in 2012, Tink stated its mission is to make banking “better” by creating technology to improve customer experience and bring more financial clarity. Tink reported that the investment is a sign of recognition that we’re building something that’s important. It gives Tink the firepower to become the leading European open banking platform.

Raisin Announces US$ 114 mn Funding Round

Berlin-based Raisin, the pan-European fintech marketplace for savings and investment products, announced last week that it has raised US$ 114 mn in Series D funding. Existing investors Index Ventures, PayPal, Ribbit Capital and Thrive Ventures all participated in the round. This takes the company’s total amount raised to €170 mn (US$195 mn), and follows its €30 mn (US$34 mn) series C round in early 2017 and an undisclosed strategic investment from PayPal in December same year. The new capital will be used for the global expansion. Raisin also announced that it has brokered a total of €10 bn in deposits to 62 partner banks, earning savers €79 mn in interest since it was founded in 2013.

TransferWise’s Head of Asia-Pacific Expansion Leaves

Lukas May, Transferwise’ Head of International Expansion in Asia-Pacific, has resigned, according to the Business Times. He will return to London to work on UK-Asia trade negotiations with the UK government. May joined Transferwise in 2017, relocating to Singapore, the firm’s Asia-Pacific headquarters, to lead the fintech’s efforts to expand into new markets in the region, as well as establish relationships with banks and regulators. Under Lukas, TransferWise set up its presence in Singapore not just as another market to expand into, but also to serve as TransferWise’s Asia Pacific hub.

Cost Of Living In Singapore

11 More Universities Join Ripple’s $50 Mn Blockchain Research Program

Ripple announced the latest group of partners that have joined its University Blockchain Research Initiative (UBRI) last week. Since its launch, UBRI has helped foster increasing levels of interest and academic activity by leading faculty, post-doctoral and graduate students at many of the world’s top universities. The program, first announced last June, provides funds for research and curriculum development related to blockchain. Ripple is helping lead development for blockchain-focused academia and research. Among the universities that recently joined the initiative were Carnegie Mellon, Cornell, Duke, and University of Michigan in the U.S.; the National University of Singapore, the Institute for Fintech Research at Tsinghua University in China, and the University of São Paulo in Brazil.

 

Listen to our January 2019 Fintech Monthly Podcast here.