News > FinTech

WhatsApp connects Indonesia
FinTech
<p>Technology leapfrogging in emerging countries is hardly a new concept. The use of mobile phones is perhaps the best example, obviating the construction of expensive infrastructure or bricks-and-mortar outlets.</p> <p>WhatsApp has spotted the enormous potential of Indonesia, a sprawling archipelago of more than 250 million people with rising personal incomes. As the Financial Times (paywall) reports:<br /> [The] chat app is used by anyone from businessmen arranging meetings to girls sharing images of their latest batik blouse, and its calling function is as central to daily life as free messaging.</p> <p>At the recent Tech in Asia summit in Jakarta, Thomas Lembong, a senior cabinet member, declared that he runs the government’s trade ministry through WhatsApp. And it is the same story with many chief executives in the country.</p> <p>There are particular advantages to using the service in emerging market cities such as Jakarta, where many offices and cafés offer free WiFi. That means bypassing not only mobile operator tariffs but also any problems with poor signal.<br /> Photo: Charles Wiriawan</p>
SoFi's expected $30B IPO adds fuel to the Renren fire
FinTech
<p>Back in March, Benzinga covered the intrinsic value of fintech investments made by fading Chinese social media company Renren Inc RENN 0.85%.</p> <p>Among Renren's many investments, its approximate 25 percent stake in SoFi looked to be the most promising, as the company was looking to IPO at around $3.5 billion. On Tuesday, Business Insider's Jonathan Marino said SoFi CEO Michael Cagney was now looking for a $30 billion dollar IPO.</p> <p>Cagney cited Dodd-Frank Wall Street Reform and Consumer Protection Act as the boost that accelerated its expected IPO valuation 10 times as much as what had been reported in March. One might be led to believe that investors in Renren would be ecstatic regarding this news.</p> <p>However, management led by Renren CEO Joseph Chen is looking to take the company private at $4.20; Shares traded recently at $3.50.<br /> Laughable Offer<br /> Aptus Capital's John Romero told Benzinga, "If and when SoFi reaches a $30 billion market cap, this translates into $17 for RENN which is an asymmetrical return from its present share price of $3.50. Knowing SoFi's long-term objective just underscores how laughable the non binding offer of $4.20 is from present management."</p> <p>Read more at Benzinga. <br /> Photo: Alexey Krasavin</p>
Sweden declares war on cash, punishes savers
FinTech
<p>&nbsp;</p> <p>Among the endangered species in Sweden are the gray wolf, European otter—and cash. Back in June, I shared with you the story of how, in 1661, the Scandinavian monarchy became the first country in the world to issue paper money. (It was an unmitigated disaster, by the way.) Now it might be the first to ban it altogether.</p> <p>All across Sweden, cash—the physical kind, not cash in the bank—is disappearing. Many if not most businesses have stopped accepting it. ATMs are now as uncommon as pay phones. Churchgoers tithe using mobile apps. Fewer and fewer banks even accept or dole out cash.</p> <p>Here’s the chart showing the decline in the average yearly value of Swedish banknotes in circulation:</p> <p>SwedenSo what’s going on?</p> <p>For one, the Swedish people have enthusiastically embraced mobile payment systems. Even homeless newspaper vendors now carry card scanners.</p> <p>But that’s not the concerning part.</p> <p>Cash’s demise appears to be orchestrated by Sweden’s central bank, which of course stands to benefit from the switch. In a purely electronic system, every financial transaction is not only charged a fee but can also be tracked and monitored. Plus, taxes can’t be levied on cash that’s squirreled away in Johan’s sock drawer.</p> <p>Since July, interest rates in Sweden have lingered in negative territory, at -0.35 percent, forcing accountholders to spend their money or else see their balances slowly melt away. Negative rates can also be found in Denmark and Switzerland, where they’re as low as -1.25 percent. The Swiss 10-year bond yield plummeted to -0.40 percent on Tuesday, which means people are paying the government to hold their “investment.”</p> <p>Nick Giambruno, senior editor of Casey Research’s International Man, calls negative interest rates in a cashless society a “scam.”  His perspective is worth considering:<br /> If you can’t withdraw your money as cash, you have two choices: You can deal with negative interest rates… or you can spend your money. Ultimately, that’s what our Keynesian central planners want. They are using negative interest rates and the “War on Cash” to force you to spend and “stimulate” the economy.</p> <p>The War on Cash and negative interest rates are huge threats to your financial security. Central planners are playing with fire and inviting a currency catastrophe.<br /> Sovereign Man goes even further, writing:<br /> Financial privacy has been destroyed. Banks are now merely unpaid spies of bankrupt governments, and they will freeze you out of your life’s savings in a heartbeat if some faceless bureaucrat orders them to do so.<br /> Read more in ValueWalk <br /> Photo: Quan</p>
Deutsche Bank upgrades its business with robo-adviser
FinTech
Deutsche Bank has just become the latest among a growing group of asset managers incorporating robo-adviser technology. The German investment bank’s latest tool, AnlageFinder, was developed with fintech firm Fincite and uses questionnaires and algorithms to tailor equities portfolios for existing customers, Reuters reports. Deutsche Bank is keen to keep up with industry peers, and the new platform is way
Aussie firm ranks as Asia's fastest growing fintech startup
FinTech
When it comes to fintech in Asia Pacific it's Hong Kong and Singapore that seem to be getting the most attention, yet it was an Australian startup that clinched the top spot for fintech in the latest 2015 Deloitte Technology Fast 500 Asia Pacific. The list, which tracks the fastest growing tech companies in the region, ranked Sydney-based Prospa -- an
Cybersecurity is no longer an IT issue
FinTech
Cybersecurity is not the biggest threat facing the financial institutions of tomorrow, it’s the biggest threat facing the financial institutions of today, say industry professionals, and it needs to be tackled differently. Speaking at ASIFMA's annual conference in Hong Kong’s Conrad Hotel on Thursday, Ben Wootliff, managing director at Hong Kong-based risk advisory Control Risks said: Cybersecurity is no longer
JPMorgan teaming up with OnDeck Capital for lending
FinTech
JPMorgan won't be left behind. The biggest U.S. bank is tying itself to OnDeck Capital, one of the biggest online lenders, to offer small business loans. The pilot project will launch in January, with Chase, the main U.S. banking unit for JPMorgan, offering loans of up to $250,000 to its 4 million small business customers through the OnDeck platform, reports
WeConquer: WeChat is turning its social network into a fintech empire
FinTech
WeChat is fast becoming one of the biggest players in fintech. The 650 million-strong social network, owned by Tencent, has been offering payments to its users in China since early 2014 but now its expanding aggressively overseas. The first big move in this direction came last month when it  partnered with Western Union to allow users to send money to
South Korea approves first online only banks
FinTech
<p>South Korea's financial regulator has granted preliminary approval for the launch of online-only banks by two groups of investors.</p> <p>On Monday, the Financial Services Commission gave a cautious go-ahead to telco KT Corp and Alibaba’s Alipay-led consortium of 21 companies that plans to invest KRW250 billion ($215.37 million) in its venture. The second group of 11 companies is led by mobile chat operator Kakao and boasts Tencent and eBay among the partners, and it intends to spend KRW300 billion.</p> <p>What's striking is the country's welcome embrace of dominant overseas fintech payments operators, in contrast to its continued reluctance to trust its homegrown chaebols to open up banks.</p> <p>In a bid to spur growth in its banking sector, South Korea is allowing non-financial firms to open banks but it still bars large industrial conglomerates such as Samsung Group and Hyundai Motor Group from taking part, says Reuters.<br /> Photo: Sébastien Bertrand</p>
Customers say “nein” to Germany’s Yapital
FinTech
<p>It doesn’t always pay to be a pioneer, as German retail giant Otto Group discovered this week when it shuttered it mobile payments business, Yapital, citing poor customer uptake, competition, and regulatory issues.</p> <p>Claiming to be “the first European, cashless cross-channel payment solution designed with modern commerce in mind,” the platform launched in 2011, and allowed customers to use QR codes to make payments and pay bills. </p> <p>Marc Berg, Yapital executive director, put forward a number of reasons for the company’s downfall,  saying that Europe's Interchange Fee Regulation had put pressure on the Yapital’s margins, but the real problem it seems was that not enough people used it. </p> <p>While retailers were said to love the concept, consumers were far less impressed. In a statement, he said:<br /> At the moment it is simply impossible to forecast business performance in this segment accurately – and above all, the development of the number of end-consumers. While we were already talking about the mobile-payment breakthrough three years ago, today studies indicate there are currently only 200,000 users in Germany.<br /> Despite Yapital's untimely demise , Germany does have a vibrant fintech sector. Only last month credit platform Kreditech raised 82.5 million ($87 million) euros from JC Flowers. But, as the Financial Times reported recently, the country's fintech startups are not without their problems, including risk-aversion among insitutions and stifling regulations.<br /> Photo: David Rosen</p>