Fintech Highlights - 11/5/2024
Here's what we've been watching this week 👇
Pinned to the Top
Zoom in: The bank has begun suing customers it says stole thousands of dollars as part of a scheme popularized in a series of viral social media videos over the summer, CNBC reports.
- Catch up quick: The alleged scheme involved people writing large bogus checks, depositing them into Chase accounts, and then people quickly withdrawing enormous amounts of cash before the checks would bounce.
Driving the news: JPMorgan today filed three separate federal lawsuits aimed at getting back their money, per CNBC.
- Though the initial suits target cases involving the biggest dollar amounts, people familiar with the situation tell CNBC that it's likely just the start of a "wave of litigation" from the bank.
By the numbers: In one case filed in Houston, JPMorgan alleges that a masked man deposited a bad $335,000 check at an ATM and then a customer immediately withdrew over $290,000.
The BFD
Robinhood Markets is jumping into election betting.
Why it matters: With over 23 million funded customers, the retail brokerage is offering up wagers on the U.S. presidential election to its massive U.S. audience.
For Robinhood, today's move is the latest attempt to attack new areas of growth. It's also an example of pouncing quickly on a hot, and potentially temporary, opportunity.
- Best known for commission-free stock trading, the company earlier this month laid out a new offering of advanced tools designed for more active traders. And it also outlined a new derivatives offering that will allow customers to trade index options and futures.
The big picture: Platforms like Polymarket, Kalshi and PredictIt have already cast a huge spotlight this year on election betting, recently described by Axios' Nathan Bomey and Brady Dale as an increasingly influential but still poorly understood force in U.S. politics.
- Previously an offshore market not legally available to U.S. bettors, election wagering in the States found a lane earlier this year when a U.S.-registered prediction market, Kalshi, sued the CFTC for banning its offering.
- It won a stay against the ban, meaning that Kalshi — and others, like Robinhood — could offer wagers while the case moves to appeal after the election.
What they're saying: "We believe event contracts give people a tool to engage in real-time decision-making, unlocking a new asset class that democratizes access to events as they unfold," Robinhood said today in announcing the new offering.
Market impact: Robinhood's stock jumped 3% Tuesday.
M&A
BT (LSE: BT) hired Citigroup to find a buyer for financial services unit Radianz, per the FT. More here ->
Slice, an Indian fintech unicorn, completed its merger with North East Small Finance Bank. Slice backers include Tiger Global, Insight Partners and Blume Ventures. More here ->
Dream Finders Homes (NYSE: DFH) agreed to buy Alliant National Title Insurance Co. from Presidio Investors. More here ->
Bridgepoint agreed to buy Eckoh (LSE: ECK), a British provider of payments and customer engagement software, for £169m. More here ->
CI Partners invested in IGG, a British provider of pensions trusteeship and governance services. More here ->
Preston Hollow Community Capital, a Dallas-based municipal finance lender, is weighing a sale process, per Bloomberg. Backers include Stone Point Capital, HarbourVest Partners, and TIAA. More here ->
NewDay, a British consumer finance firm backed by Cinven and CVC Capital Partners, agreed to buy the Argos Financial Services cards portfolio from Sainsbury's (LSE: SBRY) for £720m. More here ->
nCino (Nasdaq: NCNO) agreed to acquire FullCircl, a British regulatory compliance and customer verification platform, for $135m. FullCircl had raised around $27m from firms like Augmentum, Notion Capital, and Octopus. More here ->
Fintech
Tilled, a Boulder, Colo., embedded payments startup, raised $12.5M. Tilled’s PayFac-as-a-Service infrastructure eliminates the need for software companies to become fully registered payment facilitators, reducing regulatory compliance and liability burdens. More here ->
Biild, an Austin, Texas-based provider of financial solutions for commercial subcontractors, raised $17.5m. The company is focusing on invoice financing, supply chain financing, and cash flow management. More here ->
Gig Wage, a Dallas-based payment platform for the gig economy, raised $8.3m in Series A extension funding. The company prioritizes contractors’ needs, offering fast and flexible payment options, while providing streamlined and scalable operations for businesses. More here ->
Auquan, a developer of AI agents for financial services, raised $4.5m in seed funding. Auquan’s innovative approach utilizes Retrieval-Augmented Generation (RAG) and AI agent architecture to automate complex, knowledge-intensive workflows in financial services. This technology enables professionals to focus on high-impact decisions, rather than tedious, undifferentiated tasks. More here ->
Casap, a New York-based dispute automation startup for banks and fintechs, raised $8.5m, per Axios Pro. Trusted by fintechs and financial institutions, Casap’s AI-powered solution helps banks and fintechs identify fraudulent chargeback cases and automatically resolve legitimate cases. More here ->
Sapien, a developer of financial analysis bots, raised $8.7m in seed funding. Sapien’s bots can tackle complex tasks related to company financials, streamlining workflows and reducing days’ worth of work to mere minutes. More here ->
Airwallex, an Australian fintech most recently valued by VCs at US$5.6b, is in talks to raise around $200m at a $6b valuation, per Bloomberg.More here ->
Moniepoint, a Nigerian fintech, raised $110m in Series C funding at a valuation north of $1b. More here ->
UnitPlus, a German cash management solution for SMEs, raised €4.7m in seed funding. VC Pact led, and was joined by Seed X. More here ->
Finfra, an Indonesian lending infrastructure startup, raised $2.5m led by Cento Ventures, with participation from Accion Venture Lab, Z Venture Capital, and Matiss Ansviesulis. More here ->
Investtech
Reflexivity (fka Toggle AI), an AI-based financial research startup, raised $30m in Series B funding co-led by Greycroft and Interactive Brokers. More here ->
Brightwave, a Boulder, Colo., AI agent for financial research, raised $15m in Series A funding. Decibel Partnersled, and was joined by OMERS Ventures. More here ->
Insuretech
Bolt has announced a collaboration with Salesforce to launch Bolt for Salesforce on Salesforce AppExchange. More here ->
Branch has reportedly raised $51 million in a new funding round led by American Family Ventures. More here ->
Proptech
DoorLoop, a Miami provider of property management software, raised $100m in Series B funding led by JMI Equity. More here ->
From the Stash
Capital One spends $63M on integration of Discover - Capital One invested heavily in integrating Discover Financial Services in the third quarter as it prepares to acquire the company, providing the transaction is approved by the Federal Reserve. The deal is expected to be finalized in early 2025 if it lands regulatory and shareholder approval, Richard Fairbank, chairman and chief executive at Capital One said. More here ->
Biggest banks develop AI at 2x the speed of smaller institutions Banks with more than $1 trillion in total assets are developing and deploying AI and generative AI at twice the rate of smaller institutions. Larger financial institutions are able to spend big bucks on AI development, creating a gulf between them and smaller ones, Alexandra Mousavizadeh, chief executive of data analytics company Evident AI, said. More here ->
CFPB director favors ‘the end of screen scraping’ - The Consumer Financial Protection Bureau Director Rohit Chopra hopes the financial services industry moves away from screen scraping although the CFPB’s Oct. 22 Section 1033 Open Banking Rule did not ban the practice outright. “I favor the end of the screen scraping as fast as possible,” Chopra told Bank Automation News More here ->
Transactions from Money20/20: Citi, Google Cloud expand AI and cloud strategy - Citi is expanding its use of Google Cloud to access the cloud provider’s generative AI capabilities. Rohit Bhat, general manager and managing director at Google Cloud’s financial services, told Bank Automation News at Money20/20 this week that the $1.6 trillion bank will also look to Google Cloud for: Modernization of its tech stack; Data analytics and more. More here ->
PNC dashboard puts data sharing in customers’ hands - PNC is developing a decisioning dashboard that will give customers control over where their financial data is shared. The Section 1033 open banking rule published by the Consumer Financial Protection Bureau on Oct. 22 gives banks new opportunities to increase client engagement — or risk losing them. More here ->
Inside Mastercard’s Q3 acquisition, innovation strategy - Two acquisitions and several new products are supporting Mastercard’s ongoing innovation efforts. “All that we’re doing on strengthening our product solutions and our acquisitions … is going to be the way for us to win,” Chief Executive Michael Miebach said during Mastercard’s Q3 earnings call today. More here ->
CFPB fines VyStar Credit Union $1.5M for ‘bungled’ platform rollout - The Consumer Financial Protection Bureau fined VyStar Credit Union $1.5 million today for the botched rollout of a new online banking system, which left clients unable to access basic online banking services. The Jacksonville, Fla.-based, $14.75 billion VyStar tried to transition to a new online banking platform in May 2022, but the platform failed leaving […] More here ->
Reports & Webinars
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