Just when the banking sector thought the worst was over following the Royal Commission, the industry looks set to come under the spotlight again. Not only has the Federal Treasurer asked the ACCC to investigate the failure of banks to pass on rate cuts to borrowers, but they are also facing the prospect of further scrutiny from the boss of the competition regulator, Rod Sims ,as he presses the government to support his calls for an inquiry into the barriers to entry imposed by the “big 4” in retail banking.
- International Initiatives
In what could be a huge step forward for open banking in Australia, UK-based fintech TrueLayer has announced its entry to the Australian market ahead of the consumer data right regime’s kick-off in February 2020. TrueLayer is regarded as one of Europe’s leading providers of financial APIs (application programming interfaces) which allow businesses and fintechs to instantly receive data from different sources.
Investments in modern business intelligence (BI), augmented analytics and robotic process automation (RPA) will help drive IT spending in the banking and securities sector, according to Gartner. The research firm said that the introduction of open banking in Australia is also driving new technology investments. Gartner predicts spending on IT in finance will reach $18.5 billion in 2020 or a 5.2 per cent increase from $17.6 billion last year at a slower growth rate of one per cent.
- International Initiatives
Y! Finance: Koyo raises $4.9M in equity and debt to use open banking to offer loans to people with ‘thin’ credit files
Koyo, a fintech startup using open banking to offer loans to people with “thin” credit files and currently poorly served by the market, has closed $4.9 million in funding. The round — a mixture of debt and equity funding — is led by Forward Partners, with participation from Seedcamp. Other investors include Christian Faes (founder and CEO of LendInvest) and Charles Delingpole (founder and CEO of ComplyAdvantage). Founded in late 2018 by ex-Frontline Ventures VC Thomas Olszewski, and launching later this year, Koyo is attempting to tackle the problem whereby people without much of a credit history, such as migrants or those who have never taken credit or aren’t the main bill payer, aren’t able to secure a loan.
Treasury and the competition and privacy regulators are preparing a communications blitz to encourage bank customers to use the government’s “open banking” policy to switch away from the major banks. […] “The expectation is as we get closer to the launch date [February for open banking], it will start to become more prevalent and widely known,” Stephen Bordignon, executive director for the CDR at the ACCC, told the Future Banking Forum.
- FinTech NewsInternational Initiatives
The round was led by US-based fintech funds Nyca Partners and QED Investors, along with support from many others, including: Citi Ventures, Commerce VC, Elefund, Horizons Ventures, Royal Bank of Canada, 500 Startups and several high profile angel investors such as Cris Conde, former CEO of Sungard, and Taavet Hinrikus, founder of Transferwise.
Fidel has announced an $18 million Series A round, its first major funding to make card payment data both more secure and more accessible, so that the fintech ecosystem can develop faster.
Ramps up preparations for new regime. ANZ Banking Group has ramped up its open banking preparations by running a three-day innovation challenge that generated 21 new apps ideas. The bank held an ‘Innovation Challenge on Open Banking’ through last week, bringing together around 125 staff from across the institution to come up with new digital experiences built in Google cloud.
At Mumbrella’s Finance Marketing Summit, Fred Schebesta, co-founder of comparison site Finder.com, explained how the unassumingly titled Consumer Data Right act will allow customers to switch accounts with ease – and force traditional players to raise their game. But the challenges will also, he argues, bring opportunities to everyone in the market.
- Industry News
Which50: Australians Haven’t Fully Embraced Digital-Only Banks, But Open Banking Could Change That: Forrester
Across APAC consumers increasingly prefer digital channels for financial services. The trend, combined with regulatory changes that lower barriers to entry, is helping digital-only banks overcome incumbents’ traditional trust and scale advantages, according to new research from Forrester.
Commonwealth Bank of Australia (CBA) has restated its plan to invest more than $5 billion mostly on technology over the next five years, to maintain its leadership position in digital banking.
The bank today also announced an investment in a ‘buy now, pay later’ fintech, and detailed efforts to fend off the threat of neobanks through improved digital offerings.