Author and fintech expert Chris Skinner discusses the impact of fintech companies on banking services; the idea of free banking will essentially be gone as fintech companies are able to focus on transactional services the banks once dominated; he calls this the democratization of finance and it will help to bring more transparency to banking overall. Source.
Peter Ryan of the software provider Temenos believes PSD2 has the potential to offer banks the personal touch they have lost; allowing consumers to share their data via APIs can allow banks to learn more about their customers and offer tailored products; while some banks have been proactive there is a fair share of the market who fear open banking; better understanding of the potential in PSD2 will help banks embrace what’s ahead. Source.
There have been many recent launches of digital banks which was a result of regulatory changes in the UK; Metro Bank was the first having launched in 2010, but there are many new names since then; article highlights founders and investors in the space including Eileen Burbidge (Monzo), Sanjeev Gupta (Wyelands Bank), Jonathan Rowland (Redwood Bank), Nick Ogden (ClearBank) and the Pears family (Masthaven Bank). Source
Gabriella Kinder, head of alternative credit at NN Investment Partners, writes a piece in AltFi focusing on where the lending gap is since the end of the financial crisis; she explains that the lending gap has been reduced and alternative lending has opened up opportunities; while banks are in better shape they still face challenges on the digital front and credit has been increasing since the start of 2015; overall the gap has reduced and new opportunities have opened up as finance has become more diversified and digital in recent years. Source.
The partnership is with Bud through first direct and will offer an integrated offering of financial services products and tools across the market; Raman Bhatia stated, “At HSBC we recognise that the sector needs to innovate to meet changing customer needs and we’re investing significantly in digital innovation, including working in partnership with fintechs such as Bud” Source
P2PGI aims to raise £209 million through the deal and is working with Deutsche Bank to facilitate the Zopa loan book securitization; the portfolio will contain 31,153 loans with an average weighted interest rate of 7.2%; according to AltFi, P2PGI will hold a material net economic interest for the duration of the transaction and will also purchase at least 5% of each class of notes. Source.
The FT has seen regtech as one of the fastest growing areas of fintech with a surge of applications to their Future of Fintech awards; new regulations such as the EU’s Mifid II rules, increased compliance and KYC checks by financial institutions looking for more cost efficient ways to verify customers has helped to bring new startups into the market; fintech has moved well beyond lending and the diversification of the market continues to grow. Source.
RateSetter was the last of the “big three” p2p lenders to be authorized after a two year wait; both Zopa and Funding Circle were authorized in May, 2017; RateSetter will now be able to launch their Innovative Finance ISA; Founder and CEO Rhydian Lewis stated, “Authorisation has been a long but positive journey during which we have learnt a lot, improved our infrastructure and implemented important changes, notably making the business more transparent. Transparency is vital to our business because our customers need to understand what we do to appreciate the risk of lending on RateSetter.” Source
The UK’s Financial Conduct Authority and Cyprus’s CySEC have issued warnings to retail traders on contracts for difference based on cryptocurrencies; CFD trading based on the digital currencies has started to become popular with the volatility in bitcoin; regulators are worried that retail investors will suffer significant losses and are looking to limit leverage as a result; this continues a worldwide trend by regulators as they get a handle on the growing crypto asset class. Source.
In an interview with Business Insider at LendIt Europe Revolut CEO Nikolay Storonsky discussed the company’s continued record growth and office culture; he explains, "Nowadays people are all international. Banks are not providing this service. The vision for us is alternative global banking. Anyone in the world can just download the Revolut app and set up a local bank account to access any services they need.”; the interview also touched on the drive of his employees and his kite surfing hobby. Source.