Welcome to Interchange! If you received this in your inbox, thank you for signing up and for your trust. If you’re reading this as a post on our site, sign up Here So you can directly receive in future. Each week, I take a look at the hottest fintech news from the previous week. This includes everything from funding rounds to trends to analysis of a particular space to hot takes on a particular company or phenomenon. There’s a lot of fintech news out there, and it’s my job to stay on top of it — and understand — so you can stay informed. – Mary Ann
First, let me say that this past week was one of the busiest fintech news weeks I’ve experienced in a long time. Oops. A lot is happening. Although I obviously can’t cover everything, I’ve tried to fit as much as I can into this newsletter.
Before we get into the various news from last week, let’s talk about bank charters.
For the uninitiated, according to Investopedia: “A chartered bank is a financial institution (FI) whose main roles are to accept and protect monetary deposits from individuals and institutions, as well as to lend money. The specifics of a chartered bank vary from country to country. However, generally, a chartered bank in operation has obtained government permission to do business in the financial services industry. A chartered bank is often associated with a commercial bank.
In 2020, Digital Bank became the first all-digital nationally chartered US consumer bank – meaning approval from the Office of the Comptroller of the Currency. original bank, as opposed to partnering with one as most digital banks do.
It was a bold and risky move. So I spoke to their CEO and founder, Colin Walsh, to find out if it’s worth it. His answer? 100%
To read my full interview with Walsh about how things have been going since then, go here.
Corporate cards keep coming
Wednesday Last week it announced the launch of a new corporate credit card. A representative told me via email that the IO MasterCard is designed to help startups scale their business. “It’s straight 1.5% cashback on everything, no personal credit check and the first step to qualify for the card is just $50,000 in a Mercury account.”
The corporate credit card has been one of the most requested features from customers since Mercury launched in 2019, the company said. In fact, Mercury originally considered launching with a credit card as its first product, but decided to start with a bank account instead. Because “every entrepreneur needs a bank account to run their business…and [they] An ideal foundation on which to build additional economic properties.” Admittedly, the move was an attempt to carve out its own space against the likes of Brakes and Ramp.
Meanwhile, European fintech Payhawk It announced its launch in the US with enterprise customers in mind. As part of that move, it’s also launching its first credit card product in the US — a move that follows what a spokesperson described as a “huge year” for the company: Over the past 12 months, it’s grown revenue by over 520%. The company achieved unicorn status after raising its Series B round to $215 million.
We’re not done yet! the center, which was co-founded by former Conquer CEO and co-founder Steve Singh and launched its own corporate card and expense software offering targeting small and medium-sized enterprises, recently shared that it has tripled its customer base in the past year. while retaining 94% of existing customers” and doubling the size of the company. This is interesting because many existing corporate card players often refer to Conquer as the incumbent they are trying to replace.
These companies join several others in the US already offering corporate cards, including – but not limited to – Brex, Ramp, Airbase, Mesh Payments and Ro.
Adian It announced on September 15 that it became the first fintech to partner Cash App (Block) To offer Cash App Pay, a mobile payment method to its US customers. Adian said their businesses offer customers a way to pay using their Cash app balance or a linked debit card. Cash App COO Owen Jennings said in a written statement: “As the first financial technology platform outside of the Square ecosystem to launch Cash App Pay, we look forward to seeing the value this partnership brings to our customers and Adeon businesses.” An Adyen spokesperson told me via email: “The partnership gives Adyen business customers access to more than 80 million active customers, which make up a third of millennial and Gen Z consumers in the US, giving their customers another convenient, seamless way to pay at checkout that fits their unique financial needs and habits. .
Speaking of preventThe company was formerly (and still sometimes continues to be) known as Square It announced last week that an entire ecosystem of more than 35 products and services is now available in Spanish for sellers in the United States. This means millions of Hispanic-owned businesses in the US will have the ability to use Square in English or Spanish, “including key products like Square banking to unlock access to financial services and front-to-center hinges, Square for restaurants to enable bilingual communication. and back-of-house staff.”
While we are on the topic of payments, Goldman Sachs and Modern Treasury They announced that they are partnering to “accelerate the transition to embedded payments, help joint customers integrate into products and scale payments.” By email, a Goldman Sachs spokesperson told me the partnership furthers “Goldman’s push to better serve mid-market companies looking to bank with Goldman.” In a written statement, Eduardo Vergara, head of product and sales at Goldman Sachs Transaction Banking, said, “Embedding payments into software products is the trajectory of commerce, and by partnering with Modern Treasury, we are seamlessly creating new opportunities for clients. Leverage our payments capabilities on their own platforms.
in other Goldman Sachs News, Bloomberg reports that the investment banking and financial services giant has “begun its biggest job cuts since the start of the pandemic.” Goldman “plans to cut several hundred roles starting this month,” the publication cited people with knowledge of the matter as saying.
Buy now, pay later It made headlines several times last week. First, the Associated Press reported, “Americans prefer ‘buy now, pay later’ services… The “pay later” part is becoming too difficult for some borrowers.” Meanwhile, the tech crunch Kyle Wiggers reported that US Consumer Financial Protection Bureau (CFPB) On September 15th “Companies such as Klarna and Afterpay issued a report suggesting that companies that allow consumers to pay for products and services in installments should be subject to stricter oversight.” On the other hand, Confirm CEO Max Levchin said in an interview with Bloomberg Law: “We chose a fair amount of what the report called for. We always look at it as an act of lending subject to all lending rules and regulations.
Proptechs continue to hit. The residential real estate market sunday Last week saw the second layoff of the year. About 28% of the team — mostly sales and support staff — was laid off. Specifically, around 106 employees were let go. I contacted the company for confirmation and a representative told me via email “Sunday is focused on creating a more streamlined customer experience so we can get offers to sellers faster. The market was volatile and we saw layoffs as an opportunity to use data and technology to streamline our approach and improve our customer experience. We also saw these decisions as an opportunity to build a longer runway. I have covered the company’s 2021 growth here.
In more exciting staff news, fodder SNAP — a payments processor aimed at making it easier for grocers to accept EBT payments online — announced that Christina Herman is joining the company in a new role as chief business officer. She comes to Forage after nearly 16 years at Amazon, where she recently built and led the company’s small population team as its founder and general manager. Earlier this year, I wrote about how Ofek Lavian left his role as Instacart’s head of payments to join Forage. Today, he serves as the CEO of a startup.
FIS Launched WorldPay For Platforms, an embedded finance solution targeting SMBs. Businesses using the offering, FIS told me via email, “eliminate the need for SMBs to pay special partners to help with card issuance, cash advances or faster access to cash flow.” Obviously, this has implications for companies like Stripe or Plaid or other embeddable products that target the small business market.
ICYMI: Rebellion Revolut recently announced a new online checkout feature called Revolut Pay that “allows users to pay at online checkout with just one click.”
Seen on Technology Flow
For LatAm payment orchestration startups, market fragmentation is a blessing in disguise
The Linus Foundation announced the OpenWallet Foundation to develop interoperable digital wallets
YC batch shows entrepreneurs are optimistic about fintech
Funding and M&A
Seen on Technology Flow
Ratio bags $411M in equity, credit to flexible subscription payment models
Kenya’s insurtech Turaco aims for 1 billion users as it raises $10M in funding
Denim, a fintech platform for freight brokers, raises $126M in equity and debt
Allocations valued at $150M to help private equity funds attract smaller investors
Payal lands $10M in seed round led by a16z to help banks facilitate more cross-border payments
Lease-to-Own FinTech Startup Caffein Raises $18M To Fight BNPL
Southeast Asia fintech phase raises $100M Series C to cater to businesses of all sizes
Kippa, a Nigerian financial management app for entrepreneurs, has secured $8.4M in new funding
Fintech startup Power flexes its credit card muscle after $316M equity, debt injection
Indian fintech cred to invest in lending partner Liquilons
Alternative asset management platform Ethic bags $50M
Composer Raises $6M for Automated Investment Platform
The Redfin CEO and co-founder of DoorDash has invested in Far Homes, a new startup building a portal for Mexico real estate.
German software firm Candis raises $16M to expand AP Automation
Splitit Accelerates Installments-as-a-Service Growth with $10.5M Funding
PortX is launched as a new company by ModusBox and receives $10M in new funding
JPMorgan Chase buys fintech Renovate Payments to help fight stripe and block
Chee. That’s a lot, and if this week is any indication, the fourth quarter is going to be crazy. I’m off now trying to refresh this weekend. Hope you are doing the same! See you next week! xoxoxo Mary Ann
In case you’ve been hiding under a rock and haven’t heard, Technology Flow Disrupt is coming to San Francisco October 18–20! I would absolutely love to see you there. Click or use code INTERCHANGE to get 15% off passes (excluding online and expo) Here.