Karsten Wenzlaff, Advisor
August 26th, 2025
Karsten Wenzlaff is a Crowdfunding and Fintech Expert from Germany. He is Secretary-General of Digit[...]
Category Archives: Payments, Transfers, Rewards
BRICS Announces Launch of Blockchain Payment System
BRICS | March 6, 2024
Image: Unsplash/Kyle Glenn
BRICS Nations Announce Global Blockchain Payment System to De-Dollarize Global Finance
As reported on a Russian news agency, BRICS countries (Brazil, Russia, India, China, and South Africa) have announced the creation of a blockchain-based payment system to establish a more inclusive, efficient, and politically neutral global financial ecosystem, leveraging the latest in digital and blockchain technologies to facilitate trade settlements independent of the US dollar (de-dollarization).
- The BRICS nations are working on developing an independent payment system that utilizes digital currencies and blockchain technology. This system is designed to be convenient for governments, businesses, and the general public, ensuring cost-effectiveness and freedom from political influence.
- The BRICS payment system is part of a broader strategy to enhance the role of BRICS nations in the international monetary and financial system. The focus is on increasing settlements in national currencies and strengthening correspondent banking networks to ensure secure international transactions. Also likely to include CBDCs.
- The initiative has garnered attention worldwide, with additional countries expressing interest in joining the BRICS payment platform. This expansion indicates a growing trend towards diversification in global financial systems and the potential for a shift in how international trade and transactions are conducted.
See: The 15th BRICS Summit: A New Chapter in Global Dynamics
Yury Ushakov, Kremlin aide:
"We believe that creating an independent BRICS payment system is an important goal for the future, which would be based on state-of-the-art tools such as digital technologies and blockchain. The main thing is to make sure it is convenient for governments, common people and businesses, as well as cost-effective and free of politics."
Why It Matters
By embracing digital currencies and blockchain technology, BRICS nations are challenging the dominance of the US dollar potentially transforming the global economic landscape.
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, artificial intelligence, 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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Klarna’s AI Handles 700 Jobs, Targets $20B IPO
AI News | Feb 29, 2024
Image: Freepik
Klarna's AI-Chatbot Does the Work of 700 Humans, Eyes $20B IPO
Klarna has embraced AI in a significant way, leveraging OpenAI's technologies to enhance its customer service operations. The company's AI-powered chatbot is reported to do the work of 700 human employees, handling inquiries for its 150 million customers. This adoption of AI has fundamentally altered Klarna's hiring strategy, focusing more on engineering roles while reducing the need for traditional customer service positions.
- The chatbot has improved efficiency, reducing repeat inquiries by 25% and shortening average conversation times from 11 minutes to just two minutes.
- Despite the reduction in human customer service roles, Klarna's CEO Sebastian Siemiatkowski emphasized the benefits of AI in providing superior customer experiences, more interesting challenges for employees, and better returns for investors.
- Klarna's workforce was reduced to 4,201 by the end of 2023, from 5,441 a year earlier, partly due to these technological advancements.
See: Klarna’s New $7.99 Monthly Subscription Plan Pre-IPO
- Klarna's AI initiatives have positioned the company as a leader in adopting and applying AI technologies in the fintech sector. The company's partnership with OpenAI has been particularly fruitful, making Klarna a "favorite guinea pig" for testing new AI applications.
- Klarna's focus on AI and technology has not only impacted its workforce composition but also its operational efficiency and customer service quality, setting a precedent for other companies in the industry.
Chatbot Challenges
Financial Performance and IPO Plans
Klarna is actively preparing for an Initial Public Offering (IPO) after reporting its fifth consecutive annual net loss, signaling a strategic move towards public listing within the current financial landscape. The company's strategic shift towards AI and technology-driven operations is seen as a move to make itself more nimble and competitive, especially as it eyes a potential IPO in the near future.
- Klarna reported a fifth consecutive annual loss, with a net loss of SKr2.5 billion ($241 million) for 2023, which is narrower than its SKr10.4 billion loss in 2022.
- The company saw a 22% increase in revenues, reaching SKr23.5 billion. This financial performance comes as Klarna continues its expansion plans and considers a potential initial public offering (IPO) this year.
- The company's valuation has seen fluctuations, with a significant drop from $46 billion in June 2021 to $6.7 billion a little over 12 months later, largely due to higher interest rates impacting the fintech sector.
See: Klarna’s Meteoric Rise in the Canadian Financial Ecosystem
- Despite these challenges, Klarna is reportedly in talks with several U.S. banks about listing through an IPO as early as the third quarter of 2024, seeking a valuation of $20 billion.
- Klarna's U.S. headquarters in Columbus has been a significant part of its operations since 2015, indicating the importance of the U.S. market in its global strategy and potentially influencing its decision to pursue a U.S. IPO.
- Factors such as potential interest rate declines and the U.S. Presidential Election in November could influence the IPO landscape.
Outlook
Klarna's outlook is one of cautious optimism. The company's AI-driven efficiencies are not just about cost savings; they represent a significant shift in how customer service and operational tasks are managed, setting a new standard for the industry. Klarna's ability to streamline operations and reduce human error through AI, improving customer experience while lowering operational costs, could serve as a model for other fintech companies.
See: Amazon & Affirm’s BNPL Service Aids Small Business Growth
The fintech sector is highly competitive, with regulatory pressures and market dynamics constantly changing. Klarna's reliance on AI and its ambitious IPO plans will be closely watched by investors and industry observers alike, serving as a barometer for the company's long-term viability and the broader acceptance of AI in financial services.
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, artificial intelligence, 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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Calgary-based Helcim Secures $27 Million Series B
Funding | Feb 27, 2024
Image: Helcim blog
Helcim secures $27 million CAD in Series B to expand payment processing for underserved SMBs
Calgary-based FinTech startup Helcim has recently closed $27 million CAD ($20 million USD) in Series B financing to address the complex and often expensive landscape of payment processing for SMBs. The Series B financing was led by Headline, with participation from new investors Clocktower Ventures, Vesey Ventures, and SilverCircle, alongside returning investors Information Venture Partners and Aquiline Technology Growth.
- The Series B funding will be used to accelerate product development, focusing on enhancing omnichannel distribution channels and adding new payment, software, and financing capabilities. The funding round was not just about securing capital but also about finding partners who believe in Helcim's vision, team, and the culture they are building.
See: BoC Consultation: Draft Supervisory Guidelines for PSPs
- Founded in 2008, Helcim provides a comprehensive suite of payment solutions targeting traditional SMBs, including retail merchants, auto-repair shops, and healthcare clinics. The company aims to fill a crucial gap for Main Street businesses by offering digital-first tools, more affordable payments, and exceptional customer support.
- This investment follows a $16 million Series A funding round in March 2022, showcasing Helcim's continued growth and investor confidence. Helcim's growth has been nearly fivefold since their Series A, now servicing merchants in every U.S. state and 12 of Canada's 13 provinces and territories across more than 800 industries.
Outlook
By focusing on underserved segments characterized by higher Average Order Values (AOVs), lower digital payment penetration, and tighter working capital needs, Helcim is positioned to significantly disrupt the market and support small businesses.
See: McKinsey Global Payments On Cusp of ‘Decoupled Era’
Helcim's efforts to serve the underserved promise to redefine how Main Street businesses operate, making digital payment solutions more accessible and tailored to their specific needs.
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, artificial intelligence, 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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Züm Rails’ $10.5M Boost for North American Expansion
Funding | Feb 23, 2024
Image: Freepik
Züm Rails Secures $10.5M Series A Funding to Expand Across North America
Züm Rails, a Canadian fintech startup, is transforming the payment processing landscape by securing $10.5 million in Series A funding , led by American-based VC Arthur Ventures, funding to expand its innovative banking-as-a-service and instant payment solutions in the U.S. and beyond.
Founded in Montreal in 2019 by Marc Milewski and Miles Schwartz, Züm Rails has quickly risen to prominence by addressing the fragmented nature of payment experiences for businesses. By developing an all-in-one payments gateway that integrates open banking with instant payments, Züm Rails is enabling companies to streamline their financial transactions without needing to become payment experts. With this recent infusion of venture capital, Züm Rails is poised to accelerate its growth, expand its offerings, and solidify its position as a leader in the fintech space.
See: Autonomous IoT Transactions and Micropayments
- The company's "omni rails" technology supports a wide range of payment methods, including traditional and real-time options, through partnerships with major financial networks including Visa Direct, Mastercard, MX and Canada’s Interac network. Züm Rails' solutions are designed to reduce fraud, verify customer identities, and facilitate seamless payments, addressing critical needs in the fintech industry.
- Processing over $1 billion in payments monthly for more than 500 companies including Questrade, Coinsquare and Desjardins, Züm Rails has seen a 200% growth in the past year and recently expanded into the U.S. market. The $10.5 million funding round, led by Arthur Ventures, will be used to grow Züm Rails' presence in the U.S. and introduce new banking-as-a-service features and a FedNow offering.
Marc Milewski, co-founder of Züm Rails:
"You learn about all the problems everyone has moving money. Open banking was discussed, but I thought it was more about payments. Miles and I talked about building a whole new gateway that unified these experiences. Companies don’t want to be payment experts — that’s our job."
See: How Permissioned DeFi Will Transform Global Payments
Why It Matters
In a world where digital transactions are becoming increasingly complex and security concerns are paramount, Züm Rails offers a streamlined, secure, and efficient solution. Their solutions enhance the operational efficiency of businesses and also contribute to the broader adoption of open banking and instant payment technologies, setting new standards for the fintech industry.
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, artificial intelligence, 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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BoC Consultation: Draft Supervisory Guidelines for PSPs
BoC Payments Consultation | Feb 21, 2024
Seeking Feedback: Bank of Canada Drafts Supervisory Guidelines for Payment Service Providers (PSPs)
The Bank of Canada has recently announced a consultation phase for its draft supervisory guidelines under the Retail Payment Activities Act and its regulations. This legislative framework requires PSPs registered with the Bank of Canada to adhere to specific operational standards, including the management of operational risks, incident response protocols, safeguarding of end-user funds, and mandatory reporting of certain incidents and significant changes to the Bank. These requirements are set to take effect on September 8, 2025.
See: Canada’s New Retail Payment Regulations: Registration and Compliance
The draft supervisory guidelines prepared by the Bank of Canada delineate the Bank's expectations for PSPs in meeting these obligations. The guidelines are designed to ensure that PSPs operate in a manner that is safe, efficient, and in the best interest of their end-users. They cover a broad spectrum of operational and risk management practices that PSPs are expected to implement.
Your Input Is Required
This consultation represents a critical opportunity for stakeholders within the fintech and payment sectors to review the proposed guidelines and provide feedback. The Bank of Canada is seeking input on how these guidelines can be refined and improved to better serve both the industry and the consumers who rely on these services.
We encourage all NCFA members and stakeholders to participate in this consultation process. Your insights and expertise are invaluable in shaping a regulatory environment that supports innovation while ensuring the safety and integrity of payment services in Canada.
See: BoC Update for PSPs: New Registration Guide and Supervisory Policies Available
To participate, please visit the Bank of Canada's website to read the draft guidelines and share your feedback and contribute to a dialogue that will help shape the future of payment services regulation in Canada.
This is an important moment for the fintech community to come together and ensure that the regulatory framework aligns with the realities of modern payment services and the needs of consumers. Let's make our voices heard and contribute to the development of guidelines that promote a secure, competitive, and innovative financial services sector. For more information, please visit the website and learn more about the Retail Payments Supervision Consultation.
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, artificial intelligence, 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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BoC Update for PSPs: New Registration Guide and Supervisory Policies Available
Payments Regulation | Feb 14, 2024
Image by Freepik
Important Update for Payment Service Providers: New Registration Guide and Supervisory Policies Now Available
The National Crowdfunding & Fintech Association of Canada (NCFA) is committed to keeping its members informed about significant regulatory changes affecting the fintech sector. In line with this commitment, we are sharing an important update from the Bank of Canada regarding the registration process for payment service providers (PSPs) under the Retail Payment Activities Act (RPAA).
Registration Window Opens November 1, 2024
The Bank of Canada has announced that PSPs must register under the RPAA and its regulations starting November 1, 2024. The deadline for submitting a registration application is November 15, 2024. This registration is a critical step for PSPs operating in Canada, ensuring compliance with the latest regulatory standards and contributing to the integrity and security of the retail payments ecosystem.
New Registration Guide Released
To assist applicants in navigating the registration process, the Bank of Canada has released a comprehensive step-by-step guide. This guide is designed to help PSPs gather the necessary documents and information required to complete the application form accurately and efficiently.
Reporting Requirements
A key component of the registration process involves the reporting of quantitative metrics related to retail payment activities. PSPs are required to report these metrics at the time of registration and subsequently as part of their annual reporting. The Bank of Canada's newly released policy provides detailed guidance on these reporting obligations, ensuring PSPs understand how to comply effectively.
Amendments to Registration Applications
The Bank of Canada emphasizes the importance of maintaining accurate and up-to-date information throughout the registration process. Applicants are responsible for notifying the Bank of any changes to the information provided in their application. The latest policy update outlines the procedure for notifying the Bank of any such changes, ensuring transparency and compliance.
Resources and Further Information
For PSPs preparing for registration, the Bank of Canada's website offers a wealth of resources and information to guide you through the process. We encourage all our members and stakeholders in the payment services sector to review these materials carefully to ensure a smooth and successful registration experience. Visit the Bank of Canada's website on Retail Payments Supervision for more information.
Other links you may be interested in:
Bank of Canada: The Latest on Retail Payments Supervision and Survey
BoC Speech: Essence of the New Retail Payment Activities Act
Final Retail Payment Regulations Released Paving Way For Implementation
Canada’s New Retail Payment Regulations: Registration and Compliance
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, artificial intelligence, 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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Open Banking Regulation in the U.S. Strikes a Chord
Open Banking | Feb 12, 2024
Image by Freepik
Impending Open Banking Regulation Is Set to Transform Finance in the U.S.
In a recent Forbes article, Alexandre Gonthier, CEO of Trustly, Inc., digs into the transformative potential of open banking regulation in the U.S. This forthcoming regulation, championed by the Consumer Financial Protection Bureau (CFPB), aims to formalize consumers' rights to share their banking data, ensuring the continued availability of innovative financial services that have become integral to modern financial management.
Threat or Financial Innovation and Security Catalyst?
- Open banking levels the playing field by enabling consumers to share their banking data with third-party services, potentially bypassing traditional card-based transactions. Some large banks view open banking as a competitive threat, particularly concerning the revenue generated from credit card interchange fees, which amounted to $100 billion in 2022.
- The promotion of Tokenized Account Numbers (TANs) by big banks as a security measure. However, Gonthier points out that TANs, especially when tied to revocable data sharing, can be exploited by fraudsters, complicating fraud prevention efforts within the banking payments context.
- The CFPB's proposal mandates that consumers renew their data-sharing consent every 12 months. While intended to protect consumer data, this requirement could introduce friction into recurring payment processes, inadvertently boosting card transaction volumes.
See: BoE Report: Open Banking Boosts Productivity, Competition
- Gonthier applauds the CFPB's push for an API-based connection standard but warns of potential consumer harm if a proper transition period is not allowed for fallback to legacy connection methods during API outages.
- Monetization of Data Access: The lobbying efforts by banking associations to impose fees on consumer data access, a move that could adversely affect open banking business models reliant on high volume and low margin economics.
Gonthier believes that while the CFPB's proposal is a positive step towards fostering competition in the payments sector, the final rule must go further to ensure that alternative payment methods, such as ACH, RTP, or FedNow, can compete on equal footing with traditional card-based payments. This competition could lead to lower payment processing costs and, consequently, lower prices for consumers.
FIS's Open Access Platform
FIS recently announced its Open Access platform is set to revolutionize how consumers interact with their financial data. By integrating with leading data networks such as Akoya, Envestnet | Yodlee, MX, and Plaid, the platform offers consumers unparalleled access to and control over their financial information. This initiative not only accelerates the shift towards open banking but also aligns with the Consumer Financial Protection Bureau's (CFPB) proposed Personal Financial Data Rights rule, establishing industry-wide standards for data access and protection.
The Open Access platform empowers consumers to securely share their financial data with a broader array of financial institutions and third-party apps, enhancing their ability to manage finances through their preferred services. This approach not only fosters a more inclusive financial ecosystem but also ensures that consumers can exercise control over their data, with the flexibility to revoke access at any time.
Conclusion
By formalizing the right to data sharing, impending open banking regulation, led by the CFPB, challenges traditional banking paradigms, promising enhanced financial innovation and competition.
See: Feds Promise Open Banking Laws in 2024 and to Broaden Access to Payments Canada
As the industry adapts, initiatives like FIS's Open Access platform exemplify the potential for greater consumer empowerment and control over financial data paving the way for a future where financial services are more accessible, efficient, and aligned with consumer needs.
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, artificial intelligence, 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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