News Briefing - Crowdfunding, SME And Alternative Finance

Crowd in the Mall walking towards Admiralty Arch

1. UK – FinTech 

 

Fine words from the British Business Bank. AltFi reports: 

“Fintechs will be “even more important” coming out of lockdown than they were during lockdown helping smaller businesses return to normality, according to the British Business Bank (BBB), which has reported a £2m loss in the year ending March 2020. 

The government-backed bank, which is responsible for organising the CBILS, BBLS and other government emergency funding schemes, has updated the market on the impact that Covid-19 has had on financial institutions, businesses and its organisation in its annual report. 

It cited fintechs as playing “an important part of delivering emergency schemes during the crisis” adding “they will be even more important in the recovery, when the UK’s smaller businesses will still need to be served by a healthy, competitive and diverse finance market.” 

Starling Bank and OakNorth Bank are among the fintechs which have offered loans during the pandemic through the BBB. 

The annual report covers the period to the year ending March 2020 but the BBB offers an update on the impact of Covid-19. 

It said the Coronavirus Business Interruption Loan Scheme (CBILS) has 97 accredited lenders and, as of August 11, provided 60,000 loans worth £13.4bn. 

The Coronavirus Large Business Interruption Loan Scheme (CLBILS), meanwhile, has 23 accredited lenders and has delivered 500 loans worth £3.4bn. 

The Bounce Back Loan Scheme (BBLS) has given out over 1.1m loans worth £35bn while the Future Fund has delivered over £560m of funding to 565 businesses.” 

 

2. UK – FinTech 

 

Myles Stephenson, the CEO at UK-based Fintech firm Modulr, says he’s pleased to announce that the financial service provider has become a principal issuing member of MastercardCrowdfundinsider reports: 

“As explained by the company, this means that their products are “further embedded” in key financial infrastructure and platforms. This will allow the Fintech firm to offer fast, simple, and “frictionless” full payment capabilities to its customers. 

According to a release, Modulr will now be able to offer more seamless payments solutions in key market verticals.” 

 

3. UK – FinTech 


And less inspiring (and less surprising) words come from UK Finance, reported by Finextra.  

“Bank trade association UK Finance is urging people to be aware of criminals exploiting Covid-19 after figures revealed a sharp rise in impersonation scams in the first half of the year. 

There were almost 15,000 impersonation scam cases reported by UK Finance members between January and June 2020, an increase of 84% compared to the same period last year. Among these, more than 8000 involved criminals impersonating the police or a bank, a year-on-year rise of 94%. More than 6000 involved fraudsters imitating other trusted organisations such as a utility company or government department, an increase of 74%.

However, the amount lost to these scams saw only a modest rise, up three per cent to £58 million.

UK Finance says intelligence suggests that the rise in impersonation scams is being partly driven by criminals exploiting Covid-19. These scams include fraudsters sending emails or text messages pretending to be from government departments and offering grants related to Covid-19.” 

 

4. UK – FinTech 

Swedish fintech Tink has found that a third of the UK’s financial institutions spend up to £93m (€100m) on open banking, according to AltFi.  

“The fintech also discovered that almost half (47 per cent) of UK-based financial institutions spend anywhere from £1m to £46m on implementing open banking, with the median spend on the process sitting between £46-93m (€50-100m).  

Tink’s findings, published in a report today, also highlight the growing importance of open banking within firms across Europe, with nearly two thirds (63 per cent) reporting that their budgets for open banking have increased, with some reporting double-digit growth year-on-year.  

Since the introduction of the EU's Second Payment Services Directive (PSD2) in January 2018, open banking has revolutionised the way millions of people manage their finances and use their data, with the coronavirus pandemic only compounding this shift towards open finance even further.  

Financial institutions in the UK also had the keenest focus on ‘know your customer’ (KYC) processes, aimed at streamlining compliance and customer experiences, with UK-based firms reporting a 20 per cent higher spend on average than their European counterparts.” 

5. US – FinTech 

More from the Wild West of cryptoland. Venturebeat reports: 

"The Securities and Exchange Commission announced a settlement with esports-betting cryptocurrency firm Unikrn today for alleged violations of securities laws. Unikrn will shutter its UnikoinGold cryptocurrency token and pay a $6.1 million fine, which is all of the assets of the company. 

So ends one experiment in gaming, gambling, and esports that evidently stepped over the line of what the federal government will permit when companies issue cryptocurrencies to the public. And while the fine is heavy, the SEC did not accuse Unikrn, which was headed by Voodoo PC founder and former HP and Microsoft executive Rahul Sood, of any fraud." 

 

6. International – FinTech 

Asian robots on the lending march – P2P Finance News has the tale. 

“Robo.cash has seen rising investor demand for long-term loans offered by its Singaporean loan originator. 

In August, the European peer-to-peer lending platform’s investors funded €1.5m (£1.4m) of these loans, the highest figure to date. 

This is twice as much as in June (€700,000m) and up from July’s €1.2m. 

Robocash said that as the Singaporean loan originator is the only one on its platform that places loans lasting from eight to 12 months, the trend can be seen as a sign of a growing demand for longer-term products among P2P investors. 

Research from the platform has also indicated investors are looking to long-term assets, such as shares and exchange-traded funds (ETFs). 

In April 40 per cent of investors said that stocks and ETFs made the largest part of their portfolio, up from 33 per cent at the beginning of the year. 

Robo.cash cited analysis from MarketWatch, claiming that the pandemic and the related uncertainties seem to have caused investors to reconsider their strategies and think ahead, opting for longer-term investment products.”