Fintech Highlights - 5/10/2022

👋  Sorry for the delay this week.

The good news? This one is jam packed. Especially for the proptech fans.

Here’s what’s worth watching this week….. 👇

Pinned to the Top

TurboTax owner Intuit agreed to pay $141 million to settle a claim from all 50 states and the District of Columbia that it deceived nearly 4.4 million Americans into paying for tax services that should have been free, New York Attorney General Letitia James announced Wednesday.

Why it matters: The states alleged that TurboTax deliberately steered qualifying customers away from free federally supported tax filing products and toward its aggressively advertised and paid filing services.

• As part of the agreement, Intuit must also suspend TurboTax advertisement campaigns that the states believe falsely lured customers by promising free tax preparation services.
• Intuit faces a similar complaint from the Federal Trade Commission, which accused it last month of "deceiving consumers with bogus advertisements pitching 'free' tax filing that millions of consumers could not use."

The $141 million will go toward restitution for millions of consumers across the nation who were unfairly charged for using TurboTax’s Free Edition between tax years 2016 through 2018 even though they were eligible to use the IRS' Free File program.

• The Free File program was established as an agreement between the federal government and tax software companies after the George W. Bush administration had proposed a government-created free online filing option for taxpayers, which was opposed by such companies, including Intuit, ProPublica reports.
• The program allows low-income Americans and members of the military to file their taxes for free. TurboTax had participated in it up until 2021, while H&R Block, another major tax software company, left in 2020.

The big picture: Only one in five workers who qualify for free filing help use the service, according to a survey of nearly 7,000 service sector workers recently conducted by the Shift Project, Axios' Emily Peck reports.

• Charging low-wage earners for tax prep services ultimate cuts into their total refund amount, which is often a life-line for families.

The BFD

Stripe launched a Plaid competitor.

Stripe Financial Connections allows users to securely share financial data to streamline payments, reduce fraud, underwrite risk, and build new products.

Why this is the BFD: Because fintech spats don’t come around too often! Friendly competition abounds but the levels of sniping that Twitter bore witness to a couple of days ago is far from the norm!

What happened? Plaid CEO Zachery Perret had a particular bee in his bonnet, claiming the product’s onboarding service was uncannily similar to his own company’s. Taking to Twitter, Perret made his feelings, um, known.

The industry is full of innovators pushing each other to solve customer problems - that’s what makes it so great. Stripe’s position at the forefront of the scene will no doubt have caused particular concern to Plaid. But open beef like this doesn’t come around every day.

The big picture: Well. We wait and see. When the dust settles, there’ll be an interesting conversation to be had. Hopefully one unfolding on one of the world’s preeminent social media sites…

M&A

Bunq, an Amsterdam-based challenger bank valued at €1.6b, agreed to buy Tricount, a Belgian app for managing group expenses.  More here ->

Fintech Spotlight

Lydia lets you send and receive money from your phone; now the startup thinks it's the foundation of a social app. With this new design, the company is streamlining its app with a clear separation between your activity, your accounts, your cards and your trading activity. More importantly, the company is positioning its mobile app as a social product — not a fintech product. More here ->

Fintechs

Ness,  a New York-based fintech company building credit cards limiting the cost of wellcare, and the maker of a fintech app that rewards users for healthy behavior, raised $15.5m in seed funding. More here ->

Stride Funding, a Dallas-based a financial platform designed to help students with flexible educational funding, raised $4M. Stride, a fast-growing fintech with expertise across credit, servicing, and compliance, is the leading provider of Income Share Agreements (ISA), Deferred Tuition Agreements (DTAs), and payment plans for students across higher education and alternative education programs. More here ->

Concerto, a texas based payment start-up raised $21M in Series A funding. Concerto’s new cloud-based platform combines Mastercard card-issuing technology and analytics, leveraging Application Programming Interfaces (APIs) to accelerate the development and deployment of large-scale customised co-branded partner programmes. The company says its platform can offer instant approvals and approve more card applicants across a broad credit spectrum to ensure increased sales for partners. More here ->

🚑 Walnut, a BNPL provider focused on healthcare, raised $10M in Series A equity funding (plus $100m in debt). The funding will help Walnut address its biggest challenge, which is the balance of underwriting a lower-income population, paying healthcare providers upfront and collecting money from patients in the back end.  More here ->

Possible Finance, a Seattle-based lending startup, raised $20M. The company got its start selling small loans that give borrowers more time to pay back while helping people rebuild their credit. The new product is a credit card that does not charge interest or late fees; users instead pay a flat monthly fee for up to an $800 limit. It does not require a credit score check or security deposit. More here ->

Accern, a startup creating a suite of AI-powered tools for financial analysis, has raised $20 million in venture funding. To customers, Accern provides AI-powered apps and natural language processing (NLP) models trained to recognize, classify and extract domain-specific financial language. The service can scan public sources, including news publications, blogs and SEC filings, to gauge consumer sentiment, for example, or predict how supply chain disruptions might impact a business. More here ->

Neo Financial, a Canadian neobank, raised C$185M. Neo Financial offers a variety of products to its customers, including cash-back rewards and savings. It expanded into investing in April with a private wealth management product, and plans a mortgage offering for later this year as part of its effort to be a “one-stop shop for all financial services for Canadians and retailers.”  More here ->

KOHO, Canada's free spending and savings account, which includes a prepaid reloadable Visa card and Apple Pay, Google Pay and Samsung Pay support, recently expanded its Credit Building plan in Saskatchewan, making the offering now available nationwide. More here ->

Line, a public benefit corporation, has raised $7 million in equity financing and $18 million in debt. Line charges a monthly subscription fee, starting at $1.97, in exchange for instant cash. Once repaid, users are able to slowly build toward bigger checks, and trust that could be used to underscore credit worthiness. The company, which came out of stealth last July, has had 500,000 people register from over 5,200 cities across all 50 states. The company also said registrations are up 100% month over month, and have grown the service from instant cash to larger checks as rapport is built.More here ->

Paddle, a British provider of payments infrastructure for SaaS companies, raised $200M in Series D equity and debt funding at a $1.4b valuation. Paddle today works with more than 3,000 software customers in 200 markets, where it provides a platform for them to set up and sell their SaaS products in those regions, primarily in a B2B model. But with so many consumer services also sold these days in SaaS models, its ambitions include a significant expansion of that to areas like in-app payments. More here ->

Opn (fka Synqa), a Japanese payment processor, raised $120M at a valuation north of $1B. Opn, which has its registered headquarters in Tokyo and operational headquarters in Bangkok, said it will use the funds to expand its product line-up and push further into Southeast Asia as it rides the growth of digital payments in the region. More here ->

Egyptian fintech Paymob, which enables merchants to accept digital payments online and in-store, announced today it has raised $50 million in Series B funding. Paymob works with businesses and merchants of all sizes. Its omnichannel payment infrastructure allows them to accept payments via various methods, which CEO Islam Shawky claims to be the largest in Egypt. These different options include bank cards, mobile wallets, QR payments, bank cards’ installments, BNPL and consumer finance payment options. Paymob also has a POS solution for offline merchants where they can receive in-store card payments. More here ->

Scalapay, an Italian BNPL startup, raised $27m in new Series B funding. The company’s service is based around being tightly integrated with online retailers’ check-out process and offering users an interest-free, three-installment way to pay for anything they purchase. It now works with 3,000 merchants in Europe — specifically Italy, France, Germany, Spain, Portugal, Finland, Belgium, Netherlands and Austria — and it has yet to move into huge markets like the U.S. and U.K. More here ->

Xepelin, a Chilean fintech focusing on LatAm businesses, announced an $11M Series B round. The company offers a SaaS payments infrastructure that includes financial information in real time, embedded financial services and data models, all to be a company’s “digital CFO” of sorts. More here ->

Masa Finance, a hybrid credit protocol and decentralized credit bureau founded by Pngme CEO Brendan Playford in late 2020, has raised $3.5 million in pre-seed funding. Masa Finance links traditional financial accounts and assets from credit bureau systems and bank data to crypto holdings of users. This connection allows the company to create non-fungible credit reports for users, which they can use to access credit and other financial tools.  More here ->

Kevin, a Lithuanian fintech focused on account-to-account payment infrastructure, raised $65M in Series A funding. kevin. offers payment solutions that remove intermediaries in the payment process by leveraging the opportunity provided by open banking. Recently, the startup also stepped into POS terminal payments in physical stores by introducing an NFC A2A payments solution with a seamless user experience. More here ->

Insuretechs

Faye, an Israeli travel insurance startup, raised $8m in seed funding. More here ->

Getlife, a Madrid-based life insurance startup, raised €6M in seed funding led by Singular. More here ->

🚑 Alan, a French health insurance startup, raised €183m at a $3b valuation. Teachers' Venture Growth led, and was joined by insiders Temasek, Index Ventures, Coatue, Ribbit Capital, Exor, Dragoneer and Lakestar. More here ->

Proptechs

Realto, an Overland Park, Kansas-based online real estate investment marketplace, raised $4.5m. Firebrand Ventures led, and was joined by KCRise Fund. More here ->

Point, a Palo Alto-based home equity platform, raised $115m in Series C funding. A marketplace that pairs homeowners with institutional investors, Point's Home Equity Investment les homeowners get cash for a percentage of future appreciation. More here ->

Ownwell, an Austin, Texas-based property tax savings startup, raised $5.75m in seed funding. More here ->

Lev, a New York-based digital commercial real estate transaction platform, raised $70m in Series B funding. Lev is the commercial real estate financing platform offering fast, transparent access to capital from the world’s leading financial institutions. More here ->

Habi, a Colombian residential real estate marketplace, raised $200m in Series C funding. More here ->

From the Stash

Property Buying Platforms Raised Billions In Recent Quarters. Lately, They’re A Tough Sell — news.crunchbase.com Coming off a staggering bull run, the U.S. residential real estate market is still holding up at high levels.

TD Bank makes embedded finance play, eyes expanded automation capabilities — bankautomationnews.com TD Bank will soon automate enterprise resource and cash management processes for its commercial customers in an embedded finance move. The Cherry Hill, N.J.-based TD Bank, a subsidiary of the $1.73 trillion TD Bank Group, has selected enterprise resource management fintech FISPAN to embed TD Commercial digital banking products into an automated digital platform, according

Banking giant Truist acquires fintech startup Long Game in effort to reach younger demographic — techcrunch.com Truist acquires fintech startup Long Game in effort to reach younger demographic

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