#DigitalBanking / NuBank’s $750 Million Funding Round Proves Digital Challengers Are Still in the Game

Today’s round was led by Berkshire Hathaway, which contributed $500 million…

NuBank was founded in 2013 to serve the underbanked population across Brazil, a group that adds up to 30% of the country’s population. Today, the digital challenger has 40 million customers and offers a robust range of banking services including a debit card, insurance, loans, small business accounts, and P2P payment tools.

The massive size of this round and the notoriety of the lead investor offer a hint that digital-only banks are not just a fad limited to 2020. These newcomers have the ability and willingness to serve populations that banks have consistently ignored. Because of this, existing digital banks have increased their customer numbers in the past year, and there has been a massive onslaught of new digital banking players vying for a niche subset of the population.


#PayTech / Payment infrastructure provider Marqeta IPOs above range at $27

Marqeta, launched in 2010, provides software for companies to provide and manage their own credit cards. The company draws almost 70% of its revenue from payment processor Square, pulling that money from net interchange fees set by the card networks and paid by card holders…

Although lead underwriters Goldman Sachs and JPMorgan priced the company in the $20 to $24 range per share, research and advisory firm IPO Boutique says that Marqeta’s IPO was drawing high demand…

Additional funding round investors in the company include Visa, Mastercard, IA Capital Group and ICONIQ Capital, Commerce Ventures, 83North and Granite Ventures…

Other payment startups such as Flywire and Paymentus have gone public in recent weeks. The listings shows a continuing trend of demand for payment processing services and technologies.


#BNPL / Splitit BNPL to be embedded in ChargeAfter POS

Splitit… the company empowering consumers to use their existing line of credit to pay in installments, announced a partnership with ChargeAfter, the leading global network of personalized buy now pay later (BNPL) and point-of-sale financing for merchants, adding Splitit to complement its existing portfolio of consumer financing offerings.

Merchants using ChargeAfter can now offer their shoppers Splitit, a more intuitive and flexible way to leverage the hard-earned credit on their existing credit cards to spread payments out over time. No applications, no fees and no hassle. Because Splitit rewards customers for their good credit, shoppers can easily take advantage of installment payments without adding another line of credit. At the same time, they continue to earn rewards points, cash-back or other benefits from their credit cards. The benefit for merchants offering Splitit is attracting and boosting conversion rates of higher-value customers…

[ChargeAfter CEO:] “ChargeAfter’s mission is to create the next wave of credit by providing BNPL financing, installments, and other alternative payment options made for every shopper, no matter their financial or banking history…”


#BNPL #FinancialInclusion / Kafene raises $14M to offer buy now, pay later to the subprime consumer

The buy now, pay later frenzy isn’t going anywhere as more consumers seek alternatives to credit cards to fund purchases.

… A new fintech company is out to help consumers finance big-ticket items that are considered more “must have” than “nice to have”…

More specifically, Kafene is focused on helping consumers with credit scores below 650 purchase retail items such as furniture, appliances and electronics with its buy now, pay later (BNPL) model. Consider it an “Affirm for the subprime,” says Desai.

… The way it works is that Kafene buys the product from a merchant on a consumers’ behalf and rents it back to them over 12 months. If they make all payments, they own the item. If they make them earlier, they get a “significant” discount, and if they can’t, Kafene reclaims the item and takes the loan loss.

“This is also a superior product to credit cards, and the size of that market is massive,” Barton said. “We want to take a huge chunk of credit card business in time, and give consumers the flexibility to quit at any point in time, and fly free, if you will.”

Such flexibility, Kafene claims, helps promote financial inclusion by giving a wider range of consumers options to alternative forms of credit at the point of sale.


#WealthTech / Scalable Capital fundraise gives Germany its sixth fintech unicorn

Europe’s largest digital wealth manager Scalable Capital announced Wednesday that it has raised a $180m Series E, making it the sixth German fintech unicorn.

The round was led by Chinese technology company Tencent, which has also backed local fintechs like N26, Lydia and TrueLayer…

“We see huge demand to invest money in the capital markets instead of leaving it in bank accounts. This comes against a backdrop of record-low interest rates, growing inflation and a widening pension gap”, says Florian Prucker, co-CEO and cofounder.

Half of its clients assets are invested in baskets of securities known as exchange-traded funds (ETFs), which are seen as a more long-term and stable vehicle for investing.


#LendTech / Mark Cuban-backed banking app Dave to go public in $4 bln SPAC merger

Launched in 2017, Dave is an app used to help Americans avoid billions of dollars in overdraft fees charged by traditional banks. It currently has 10 million customers.

The deal with special-purpose acquisition company (SPAC), VPC Impact Acquisition Holdings III Inc (VPCC.N), includes a $210 million investment led by Tiger Global Management, with additional participation from Wellington Management and Corbin Capital Partners…

A SPAC is a blank-check firm that seeks to merge with a privately owned entity, a deal type that has become very common in the last year.


#BNPL / Klarna launches major new product update

This new Shopping feature allows UK Klarna users to shop at any online retailer, regardless of whether they’re partnered with Klarna or not, and split the payment into three interest-free instalments – eliminating the need to use a credit card. It will also integrate monthly budgets and personal spending limit functionalities for users to set and remain in control of their spending.

Additional features include personalised wish lists and curated content based on consumers’ interests and their favourite stores, price drop notifications, thousands of deals updated daily, and lists of retailers for users to decide where to buy their favourite product, at the best price.


#Cards / Marqeta Aims for Valuation of More Than $12 Billion. The IPO Is Next Week.

Marqeta, the technology platform for card issuers, is going public next week.

Marqeta is scheduled to price its deal on June 8 and trade the next day, a person familiar with the situation said. With roughly 530.2 million Class A and Class B shares outstanding, Marqeta could be valued at more than $12 billion. Goldman Sachs and JP Morgan are lead underwriters.

Founded in 2010, Marqeta provides technology—an application programming interface—that helps companies like Square (SQ), Instacart, and DoorDash issue cards, including debit and prepaid, and process payments for their customers.


#PayTech / Walletmor rolls out payment implants

British-Polish startup Walletmor has lunched the ultimate contactless wearable, a biopolymer payment device that can be implanted just under the surface of the skin.

Available for €199, the implant is the size of a small safety pin and about half a millimeter thick, consisting of an integrated circuit and a metal sheath acting as an antenna.

The biopolymer was created by scientists from laboratories of VivoKey Technologies Inc. from Seattle, and comes with current biocompatibility certificates confirming compliance with the ISO 10993 standard.

[Walletmor:] "Until now, no one has produced a payment implant that is safe and accepted all over the world… In order to use the implant, you only need to set up an account on the European iCard platform and transfer some money into your account.”