Category Archives: Digital, NEO, Open Banking, Open Finance
Forget Unicorns. Zebras are (more sustainable) and the future!
Proptech For Good | June 2020
Business-as-usual is no longer adequate for the challenges of the 21st century. Capitalism is beginning to lose its 'licence to operate' and the Unicorn mindset of 'Move fast and break things' is about to break. Purpose-driven companies today will play a key role in achieving ambitious sustainable development goals. That is why it is time to welcome a new animal to the PropTech zoo, the Zebra.
Taking responsibility for the future
Over-ambitious tech start-ups that paint convincing images of growth do not always translate into business success. The most powerful illustration of this was Wework's planned IPO in September 2019. The $47 billion valuation had already been widely questioned and by the time the IPO was officially withdrawn, the value had fallen by more than $30 billion in just a few days. Since the collapse of WeWork, investors have become more cautious about investing in 'hyped' Proptech startups and scale-ups. The era of 'Move fast and break things' is over.
See: Stop hunting unicorns and start aiming at Zebras
More and more entrepreneurs and (their) employees find the current way of doing business (focused on hyper growth and move fast and break things) not future-proof. They don't want to continue on the track of individualism, competition and the extraction of value. Customers, employees and even investors are increasingly urging companies to reconsider their view of the world and take a closer look at their place in it. Changing societal values, climate change, depletion of natural resources, and economic and political instability are beginning to call into question long-held beliefs - including the idea that growth is acceptable at any cost.
Capitalism and animal extinction
Capitalism is in the middle of the autumn of its existence. And by capitalism I mean a group of legal entities with the aim of competing for resources and 'profit maximization' for the shareholders. Capitalism is based on financial capital. However, there is also social and ecological capital. Changing social values and people's pressure force companies to reconsider their focus on a narrow definition of growth.
"It's time for a new capitalism - a more fair, equal and sustainable capitalism that actually works for everyone and where businesses, including tech companies, don't just take from society but truly give back and have a positive impact" - Marc Benioff, CEO Salesforce. Source: NYTimes, 14 October 2019.
The Business Roundtable, (an influential association of nearly 200 CEOs of North America's leading companies), redefined a company's mission (from shareholders to stakeholders focus) in 2019, marking an important turning point. Blackrock, the world's largest hedge fund, has also recently made a number of additional strides into the sustainable pouch. In the future, they will only invest in purpose-driven organisations and will put sustainability at the heart of how they invest.
These developments also include new words and storylines. Shouldn't we also look for an alternative to the Unicorn? Because if we carry on like this, all the animals will die out.
Zebras are welcome at PropTech zoo
Today I am planning the seed for a solution and I want to encourage PropTech founders, investors, real estate companies and their stakeholders to organise themselves. This movement requires a new symbol, so we claim a new animal for the PropTech zoo: the zebra. The zebra company is not really new, but it is new to the PropTech storylines we are going to develop. In 2019, others started communicating about zebra companies in the New York Times, Harvard Business Review, PC Magazine, The New Yorker and others.
See: State of Fair Banking 2020
What is a zebra company? A zebra company is a company whose business model is aimed at realizing a social goal with as a result the creation of profit. Zebra companies are characterized by sustainable progress and development, not aimed at disrupting current markets, exponential growth and striving for its rapid exit. Zebra companies work together to create shared value and are not in the position of winners and losers and more, more, more. Unlike inflated unicorns, zebras are real animals.
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The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Revolut leaving Canadian market
Betakit |
United Kingdom-based FinTech startup Revolut is pulling out of Canada, BetaKit has learned, more than a year and a half after launching a beta version of its offering locally.
In an email shared with Revolut Canada beta users and obtained by BetaKit, the company stated it is “discontinuing [the] Revolut Canadian beta from March 15, 2021.” A Twitter comment from the company confirmed Revolut is closing its Canadian operations.
“This has been a difficult decision, but we’ll do everything we can to make this process as smooth as possible for you,” the email stated. “We really appreciate your support and trust as we work on our global expansion and we hope to be able to return to Canada in the future.”
“We’re very sorry to be announcing this today but have taken the difficult decision to discontinue our Canadian beta for now,” a spokesperson for Revolut Canada said in a statement to BetaKit when reached for comment.
“We very much hope to be able to return to Canada in the future but we’re sorry to be saying au revoir until then,” they added.
See: Nov 20, 2017: NCFA Canada Welcomes Competition Bureau’s recommendations to encourage competition and innovation in Canada’s financial services sector
According to the email sent to Revolut users, account top-ups will no longer be available as of March 29; physical card ordering will no longer be available as of April 12; and account access will no longer be available as of May 15. The company stated that if customers are not able to use their remaining balance before this date Revolut will reimburse them in full.
Revolut has been working to launch a full-fledged Canadian service since 2019. In November of that year, the company began providing early access to accounts for Canadian users ahead of an official launch within the country. However, that launch never came to fruition outside of the beta offering.
Revolut’s Canadian head of strategy and operations manager, Saud Aziz, spoke with BetaKit in 2019 about some of the challenges Revolut and fellow challenger banks face in Canada.
He noted at the time that regulators need to understand that Canada shouldn’t have a binary framework between existing as only either a bank or not a bank. He added that regulatory change is necessary but only likely to come from Canadian consumers demanding change.
The spokesperson pushed aware concerns around competition and regulation, stating “we’ve no issues with competition or regulation. Those things exist in every market we’re in and we think both are good for customers.”
Continue to the full article --> here
See:
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Competition Bureau weighs in on fintech: urgent action required
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Monopoly-Friendly Canada ‘Does Not Treat Competition Policy Seriously’
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From Global Leader to Follower, is Canada losing its FinTech edge?
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Advancing a more resilient and proportional banking regulatory framework in Canada
OSFI | March 11 2021
OSFI launches consultations on Basel III implementation and a new tailored approach to capital and liquidity requirements for smaller, less complex banks
OSFI launches consultations on Basel III implementation and a new tailored approach to capital and liquidity requirements for smaller, less complex banksOTTAWA ─ March 11, 2021 Office of the Superintendent of Financial Institutions
The Office of the Superintendent of Financial Institutions (OSFI) plays an essential role in building and preserving resiliency in Canada’s financial system. OSFI’s commitment to implementing the international Basel III Framework has strengthened Canadian banks and improved their ability to handle financial shocks, so they can continue to support economic growth while remaining competitive.
Today OSFI launched an industry consultation on proposed regulatory changes to introduce the latest and final round of Basel III reforms into its capital, leverage and related disclosure guidelines for banks. OSFI’s proposals are in line with the international standards set by the Basel Committee on Banking Supervision (BCBS), while reflecting the Canadian market. Along with these updates, OSFI is proposing changes to enhance proportionality in its capital and liquidity regimes so they remain appropriate for smaller, less-complex banks.
See: Review: Financial Consumer Agency of Canada (FCAC) submission to Advisory Committee on Open Banking
Enhancing transparency and improving comparability in disclosure requirements
In addition, OSFI is consulting on updates to its Pillar 3 Disclosure Guideline. These proposed changes enhance transparency surrounding the capital, leverage and liquidity positions of Canada’s largest banks while ensuring comparability and consistency with the disclosures of their global peers. Similar but proportional updates are being developed for Canada’s smaller, less-complex banks.
Tailoring capital and liquidity expectations for small- and medium-sized banks (SMSBs)
OSFI is unveiling the SMSB Capital and Liquidity Requirements Guideline, a new guideline that outlines revisions to the capital and liquidity frameworks for SMSBs which are more tailored to reflect the unique attributes of these institutions. OSFI used input from its January 2020 consultative document: Advancing Proportionality to design the new framework.
Questions for SMSBs:
- For Category I, II and III SMSBs, if OSFI were to adopt Pillar 3 disclosures from the Basel Framework Disclosure Requirements, which disclosures would be particularly challenging to prepare among the following risk categories:
- Credit risk
- Counterparty credit risk
- Securitisation
- Operational Risk
- Remuneration
- Comparison of modelled and standardised RWA (A-IRB approved SMSBs only)?
Please provide your rationale.
OSFI is seeking input on its proposals until June 4, 2021, while consultation on changes to its disclosure guideline is open until July 2, 2021. OSFI will publish a summary of comments with the release of its final guidance in late 2021.
View the original press release --> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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NCFA Announces 7th Annual FFCON21 Digital ‘Breaking Barriers’ FinTech Conference
NCFA Canada | FFCON21 Team | March 11, 2021
FFCON21 to connect HR talent and explore accelerated Fintech trends and innovations paving the way to mass adoption and scale
TORONTO — March 11, 2021 — The National Crowdfunding & Fintech Association (NCFA), organisers of Canada’ foremost Fintech conference, is pleased to announce the return of FFCON for its 7th consecutive year. The annual FFCON Digital Event, held in association with Toronto Finance International (TFI), will take place May 11-13, 2021.
Building on the success of previous conferences, this year’s event -- titled ‘Breaking Barriers’ -- will bring together an international community of leading voices in fintech, digital banking, tokenization, blockchain, CBDCs, digital identity, AI, capital markets innovation, EDI (equality, diversity and inclusion) and sustainable, open, and alternative finance.
“Fintech is evolving quickly and breaking barriers,” said Craig Asano, Founder and CEO of the National Crowdfunding & Fintech Association of Canada. “Fintech is no longer niche -- it is a permanent technological evolution that is changing the world of finance by high growth fintech companies and incumbent financial institutions. It’s rewiring financial services for the new economy and setting new standards that also demand new regulations. Most importantly, it’s about improving access and delivering better financial products, services and outcomes for everyone especially consumers and small to midsize enterprises (SMEs).”
The theme of FFCON21 reflects the growth and challenges that the Canadian Fintech industry has had to navigate through to foster scalability and mainstream adoption, made all the more complicated through the disruption caused by Covid-19.
“Our Fintech ecosystem has become a great strength in the greater Canadian innovation landscape. COVID-19 has accelerated the pace of change in the industry and highlighted the important role digital innovation plays in the competitiveness of the financial services sector. Rapidly changing consumer habits and ways of delivering products and services offers a significant opportunity for Canadian Fintechs" Jennifer Reynolds, President & CEO, Toronto Finance International
Beyond covering important fintech topics, FFCON21 will offer an engaging and fast-paced interactive agenda, including investor speed dating, sports-inspired Fintech Draft pitching and demo competitions designed to identity and feature emerging fintech stars, debates, round table discussions, digital ebooths and virtual expo, 1-on-1 networking opportunities and unique experiences. Delegates and partners can build their knowledge base, launch or scale an idea or collaborate digitally with visionary entrepreneurs and investors.
New to FFON21 this year, organizers are adding an HR fintech talent marketplace to connect anyone seeking new opportunities with high growth companies, and a ‘deep dive’ masterclass series on the topic of decentralized finance as part of its quarterly Global Fintech Now program for VIP passholders.
The multi-day event will run from May 11-13 inclusive with daily content to span feature themes of Digital Innovation and Breaking Barriers, Creation & Growth and Global Future Forward. Updates to the evolving programme and speaker lineup can be found on the FFCON21 website.
Registration Now Open
Registration for FFCON21 Breaking Barriers is now open with special early bird rates for delegates, exhibitors and startup packages available for a limited time. Tickets can be purchased at https://fintechandfunding.com/tickets/.
Useful Links
Fintech Draft Pitching & Demo Application
Website | Experience | Partner Packages
Connect with us
About the NCFA
The National Crowdfunding & Fintech Association (NCFA) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain and cryptocurrency, Regtech, and Insurtech sectors. To learn more about NCFA visit www.ncfacanada.org
About Toronto Finance International
Toronto Finance International (TFI) is a public-private partnership between Canada’s three levels of government, the financial services sector and academia. TFI’s mission is to lead collective action that drives the competitiveness and growth of Toronto’s financial sector and establishes its prominence as a leading international financial centre. For more information, please visit: www.tfi.ca
About FFCON
FFCON21 (Fintech and Financing Conference) is an annual conference hosted by Canada’s National Crowdfunding and Fintech Association (NCFA). Now in its seventh year, FFCON21, held in association with Toronto Finance International, will bring together professionals and innovators in fintech, open banking, digital identity, blockchain, cryptocurrency, AI, capital markets innovation, sustainable and alternative finance.
Further information about the conference can be found at www.fintechandfunding.com
FFCON21 Contacts
Craig Asano
Founder and CEO, NCFA
casano@ncfacanada.org
(416) 618-0254
Partnership Inquiries
Lauren Linton
Advisor, NCFA
lauren@ncfacanada.org
(416) 569-4349
Media Contact
The Top Floor Public Relations
Michele McDermott-Fox
michele@thetopflooragency.com
(905) 379-1893
David Lewis
david@thetopflooragency.com
(905) 541-5699
Koho secures $70 million Series C to scale adoption of its digital banking services
Betakit | | Mar 11, 2021
Koho has secured $70 million CAD in Series C financing, which sources estimate put its post-money valuation at $300 million. The Toronto FinTech startup raised the capital from TTV Capital, Drive Capital, and Portag3 Ventures as it aims to increase the utility and adoption of its alternative financial service offerings.
The round was led by new investor TTV Capital, a United States firm focused on FinTech and claiming an unparalleled network of major banks, processors, and other payment ecosystem participants. TTV invested in Koho through its $127 million USD early-stage FinTech fund, which closed last year.
Longtime Koho investor Portag3 Ventures followed-on for the Series C round, as did Drive Capital, which led Koho’s Series B extension in November 2019. The latter firm committed the largest portion of capital to this latest round.
See: Public and Private Cloud AI Digital Banking
The $70 million is all primary capital, $50 million of which is equity and $20 million venture debt. Eberhard told BetaKit the round also included secondary financing on top of the $70 million but declined to disclose the amount. The CEO did confirm, however, the deal did not change Koho’s board of directors, which has five members: two Portag3 seats, one seat for Drive, one independent, and one founder seat held by Eberhard.
With Koho feeling it has found product-market fit, the $70 million will act as fuel to reach what founder and CEO Dan Eberhard called the macro adoption of its financial service offerings.
Koho has turned its focus to scaling as the COVID-19 pandemic “dramatically accelerated” the company’s timelines, given its focus on digital-first products for a digital-first generation. Koho has nearly doubled its customer base since the beginning of 2019, garnering more than 350,000 users. The startup handles $2 billion a year in transaction volume and Eberhard claimed Koho is set to triple its revenue again this year.
“Folks who offer a great online virtual-first experience make a lot of sense in an increasingly remote world and so we’ve continued to see acceleration,” said Eberhard. The CEO pointed to both the ongoing digital transformation and Koho’s direct deposits offer for the Canada Emergency Response Benefit (CERB) as reasons why the startup saw growth during the pandemic.
The Toronto-based FinTech startup, which first launched to market four years ago, has noticeably been building out its product offerings over the last couple of years. In addition to a spending account, Koho recently launched a savings account and a credit building product, giving it the core services consumers expect to see from a traditional financial institution and setting it up to be more competitive in the market.
See: Fintech Canada Directory Category: Digital Banking | Analytics | Infrastructure
Awareness and adoption represent key areas of focus, as well as challenges, for Canadian neobank or challenger bank startups like Koho.
The COVID-19 pandemic has presented an opportunity for such digital-first offerings, having significantly changed the Canadian banking industry. Many Canadian banks have increased their focus on digital-first, with reports noting rapid acceleration and changes in consumer expectations. However, it is still too early to tell the exact effect the digital transformation of the past year will have on the sector and what it will mean for challenger banks.
“Consumers today have high expectations for the banking experience,” said Drive Capital partner Chris Olsen. “They’re looking to challenger banks to provide an elegant, mobile-first solution. Canadians are already turning to KOHO for their financial services and we expect this to accelerate going forward.”
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The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Digital innovation during crisis launches tea auctions and digital currencies
IMF | Steven Dorst | March 9, 2021
Never let a serious crisis go to waste.” Innovators around the world are taking the saying seriously, responding to the disruption caused by the COVID-19 pandemic with creative digital solutions.
The Bahamas: first digital currency
In October 2020, The Bahamas leapfrogged into the digital vanguard with the launch of the world’s first central bank digital currency—the sand dollar. Pegged one-to-one to the Bahamian dollar and using a blockchain-backed digital token, the new currency is available to people and businesses to buy and sell goods and services and send money to each other. Sand dollars are issued and regulated by The Bahamas’ central bank.
- The Bahamas territory is spread out over 700 islands—making it unprofitable for commercial banks to have ATMs or physical branches on remote, sparsely populated islands. Extreme weather events make the cost of maintaining infrastructure even steeper.
See: Canadian researchers develop CBDC digital currency proposal for Bank of Canada
- As a result, the most vulnerable often lack access to financial services. The need to serve the unbanked and underbanked population, along with a drive to modernize the payment system, spurred the central bank’s introduction of the new digital currency.
- It is still early days, with only $130,000 worth of sand dollars in circulation compared with $500 million Bahamian dollars. Customers’ initial reaction has been positive. Those who are using the sand dollar enjoy the ease, faster turnaround, and lower costs.
“When I first heard about the sand dollar, I was extremely excited,” says Brandon Kemp, founder of Tin Ferl, a popular pop-up food park in Nassau. “The amazing thing about the sand dollar is that there are no fees or transaction costs. So, if I need to pay one of my staff, I can do it right there in the moment; they receive it literally within seconds, and everybody is happy with that.”
Sri Lanka: tea auction transformed
For more than 125 years, the tea industry has depended on a tradition-steeped auction where hundreds have convened twice a week at the Ceylon Chamber of Commerce to buy and sell Sri Lanka’s finest leaves. When COVID hit, the world’s oldest tea auction, which had functioned without fail for more than a century, was suddenly unable to bring together buyers and brokers for the weekly bidding. Plantations and factories had nowhere to sell their product, buyers were left in a lurch, and millions were at risk of losing their income.
See: Retail And The Underbanked Opportunity
- Sri Lanka’s tea auction faced an urgent need to reinvent itself. With brokers and buyers unable to meet in person, the challenge was not just to find an alternative to the live auction, but to get it up and running and yielding good prices—immediately.
- Local IT company CICRA Holdings led technical development, working with brokers trained to interpret the dynamics of in-person bidding and with deep knowledge of tea categories and grades. To succeed, the e-platform would have to reimagine all the human and technical variables of the live auction. Within days, some 300 people had taken part in simulated training programs, with sessions running up to the night before the launch.
- Not only is the new system COVID-safe, it’s also faster, more strategic, and cost-effective—and even yields higher prices. The online auction has also improved transparency and efficiency and reduced duplication of work.
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The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Public and Private Cloud AI Digital Banking
The Financial Brand | Bill Streeter
The industry is entering a critical phase. Legacy technology will finally be superseded by a combination of cloud computing and AI, putting banks and credit unions closer to par with fintechs. But without phasing out the traditional product silo/back-office environment, that change won't happen.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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