News Briefing - Crowdfunding, SME And Alternative Finance

1. UK – FinTech 

 

AltFi reports: 

“Business lender Allica Bank has closed a £26m follow-on funding round from majority shareholder Warwick Capital Partners and is already eyeing more capital. 

Newly-appointed CEO Richard Davies announced today that Goodbody and Ashcombe Advisers had been appointed to lead a £100m additional raise in order to meet surging demand from its business customers. 

Allica said it has received more than £1bn worth of borrowing demand from SMEs in the wake of Covid-19. 

“Established small and medium sized enterprises will be vital to the recovery and health of the UK economy, but it is clear that the supply of finance has been very badly damaged by Covid-19 outside of the government schemes,” said Davies, who joined Allica after stepping down as Revolut’s banking CEO. 

“The time is now for Allica to scale up its operations to meet this business funding gap, bringing a blend of human relationships, deep lending expertise, and digital disruption.”  

2. UK – FinTech 

P2P Finance News reports: 

“The Financial Conduct Authority (FCA) has said guidance on payment deferrals for personal loan borrowers is expected to expire at the end of October but is being kept under review. 

Struggling consumer credit borrowers have been allowed to request three-month payment deferrals since July under FCA guidance that is due to end on 31 October. 

Updated draft guidance from the City watchdog said borrowers can still apply for the support until the end of October, meaning some deferrals could last until the end of January 2021, but added that the rules on granting payment breaks are still expected to end next month. 

“We expect the July guidance to expire on 31 October but we will keep this under review depending on how the wider situation develops,” the FCA said. 

The FCA is now consulting on draft guidance to replace the current forbearance rules. 

The guidance urges firms to treat customers fairly and ensure payment arrangements are affordable. 

It also suggests suspending, reducing, waiving or cancelling any interest, fees or charges for missed payments.” 

3. UK – FinTech 

Finextra reports: 

“ClearBank is to offer clients the ability to create multi-currency bank accounts via a an API-based connection to JPMorgan. 

The move will provide customers with the ability to move funds between accounts with real-time foreign exchange pricing based on interbank rates.

Client funds will continue to be held at ClearBank, which will act as a conduit to JPmorgan, providing access to multiple currencies, pricing, and execution all via an API.

Jon Lloyd, head of FIG Sales Europe, at JPMorgan says: “APIs are becoming increasingly important to how we create a better customer experience. APIs enable us to bring services to customer in a faster, more customised way and ClearBank’s approach is indicative of the way in which the market is moving.”

Simon Jones, chief customer officer, ClearBank, says customers will benefit from increased liquidity, improved visibility into cash flows, and greater control as the need to transfer funds to third party accounts is removed.” 

 

4. UK - FinTech 

Some more anodyne words from the British Business Bank, this time from the new CO. AltFi reports: 

“The fintech industry is an industry “you absolutely can’t ignore” says the new CEO of the government-backed body which has been responsible for administering emergency loans to banks and alternative lenders to help companies damaged by Covid-19. 

Catherine Lewis La Torre, who took on the role of CEO of the British Business Bank this month, painted an upbeat picture of the role fintech can play as the economy tries to recover following coronavirus. 

The BBB provides money through commercial lenders and fund managers to smaller companies and start-ups.  

Its remit has been thrown into the spotlight because it administered the Coronavirus Business Interruption Loan Scheme (CBILS), the Bounce Back Loan Scheme (BBLS) and Future Fund to stricken companies during the pandemic. 

It is also, through VC fund managers, a significant investor in fintech and to date has supported fintechs including OakNorth, TransferWise, Funding Circle and Revolut. 

 

5. US – FinTech 

 

The Wild West of cryptoland. Crowdfundinsider reports: 

“The state of Wyoming has approved its first Special Purpose Depository Institution (SPDI) by approving Kraken Financial – part of the well known digital asset exchange. 

Tentatively called Kraken Financial and based in Cheyenne, Wyoming, Kraken Financial claims the title as the “first digital asset company in U.S. history to receive a bank charter recognized under federal and state law, and will be the first regulated, U.S. bank to provide comprehensive deposit-taking, custody and fiduciary services for digital assets,” according to a blog post. 

David Kinitsky, CEO of Kraken Financial, commented: 

“We’re thrilled to work in a state so aligned with our philosophy and values. Wyoming is a rare and shining example of how thoughtful regulation can drive innovation for FinTech companies.” 

Kraken Financial expects to be regulated in largely the same manner as other U.S. banks. 

Kraken Financial states that it will “start locally, but will soon operate globally.” 

Initially, only domestic accounts will be accepted but the intent is to offer international accounts soon.”