One of the last actions of the Obama administration this week was to release a policy framework for fintech. This was a follow up from the White House Fintech Summit in June 2016 where many of the leading fintech companies gathered in Washington for a day of presentations and roundtable discussions. The paper provides a framework with ten principles that policymakers and regulators can use to think about and engage with the fintech ecosystem. Given today is the inauguration day for a new administration we won't know if these principles will be carried through but we do hope the Trump White House will make fintech innovation a priority. Source
Rocket Internet has reached the investment cap of $1 billion on its Rocket Internet Capital Partners fund; fund will invest in early stage and growth startups including fintech and marketplace lending companies; received the majority of its investment from institutions. Source
Speaking at the World Economic Forum in Davos, PayPal CEO Dan Schulman says lower transaction costs from fintech payment processors could save $28 billion and help 30 million people out of poverty; firm is seeking to build partnerships with payment companies and governments to lower transaction fees and advance digital payment services. Source
Robo advisor Wealthfront has developed a solution that allows employees to trade accumulated shares of initial public offering stock through a platform called Selling Plan; targets employees of newly traded public companies and employees receiving stock options for compensation; employees can use Selling Plan for free to manage shares of their stock. Source
Juzhen is developing new blockchain technology for banks that will focus on privacy, biometrics and access control; the firm is the largest China-based blockchain startup; it is working with the ChinaLedger blockchain consortium and has a thorough understanding of the Chinese market's infrastructure and banking culture. Source
ThreatMatrix announced its 2016 financial results with substantial growth in new financial institution customers; firm's business has been increasing traction, reporting $15 billion saved in fraud losses for its customers in 2016; revenue growth rates continue to be 50%; in 2017 the firm is planning for global expansion with an additional data center opening in in Reykjanesbaer, Iceland. Source
The comment period for the Office of the Comptroller of the Currency's fintech charter proposal closed on January 17 and the New York Department of Financial Services (NY DFS) was among the commenters; the NY DFS opposes the federal fintech charter; says state regulations have evolved to provide the necessary oversight; also notes that the regulations will create confusion, harm small business innovation, create monopolized institutions, increase competitive risks of non-bank entities and facilitate evasion of consumer protection. Source
Established fund management companies are leading the next wave of market computerization through investment in robo advisors; robo advisors offer automated investment options with lower fee structures; investment managers are buying and integrating these services to expand their offering and mitigate competitive factors; a partnership between John Hancock Financial and NextCapital is one of the latest examples; other deals have included SigFig with Wells Fargo and UBS, BlackRock with FutureAdvisor and Fidelity with eMoney. Source
According to a new report by Accenture and McLagan, which is part of Aon Hewitt a business unit of Aon plc, blockchain technology could reduce infrastructure costs for eight of the world's 10 largest investment banks by an average of 30%, translating to $8 billion to $12 billion in annual cost savings for those banks; key figures include a 70% cut on central finance reporting, a 50% cut on business and central operations, and a 50% cut on compliance. Source