News Briefing - Crowdfunding, SME And Alternative Finance

Wall Street sign

1. UK – FinTech 



Altfi reports a business boom – although there is nothing literal at all about the metaphorical flow of money…  

“Cash is quite literally flooding into buy-now-pay-later superstar Klarna at an incredible rate, as it yesterday confirmed a fresh $639m funding round from investors, including SoftBank’s Vision Fund 2. 

As a reminder, Klarna already raised $1bn earlier this year from a number of undisclosed investors at a $31bn price tag. 

Just three months on from the last round, yesterday’s new round came at a higher-than-expected whopping $45.6bn valuation. 

Yanni Pipilis, managing partner for SoftBank Investment Advisers said,  

Klarna’s growth is founded on a deep understanding of how the purchasing behaviors of consumers are changing, an evolution which we believe is accelerating,” said SoftBank Investment Advisers managing partner Yanni Pipilis. 

Klarna has already successfully expanded into the US and we are excited to continue supporting the team in bringing the next generation of financial services to new markets worldwide.” 

Along with SoftBank, existing investors Adit Ventures, Honeycomb Asset Management and WestCap Group all took part in the funding.” 


2. UK – FinTech 


Finextra reports: 

“The Bank for International Settlements has opened its third innovation hub in London. 

Established in 2019 to support exploratory work into new frontiers in financial technology, BIS Innovation Hub Centres are already in place in Hong Kong, Singapore and Switzerland.

The Hub’s work programme is currently focused on six areas: use of technological innovation in supervision and regulation; next generation financial market infrastructures; central bank digital currencies; open finance; cyber security; and green finance.

Welcoming the London opening, UK Chancellor of the Exchequer Rishi Sunak, says: “The UK is known for pushing the boundaries of digital finance so it’s great to have the new Innovation Hub opening here. Its work will help central banks to support safe innovation, and boost our efforts to capture the extraordinary potential of technology.” 


3. International – FinTech 


Finextra reports: 


“State Street is embracing the shift to decentralised finance with the creation of a new division specifically to engage with digital assets, including cryptocurrencies. 

“The financial industry is transforming to a digital economy, and we see digital assets as one of the most significant forces impacting our industry over the next five years,” says Ron O’Hanley, chairman and chief executive officer of State Street Corporation. “Digital assets are quickly becoming integrated into the existing framework of financial services, and it is critical we have the tools in place to provide our clients with solutions for both their traditional investment needs as well as their increased digital needs.”

The new division will build on State Street’s current digital capabilities and will expand to include crypto, central bank digital currency, blockchain, and tokenization.

The bank intends to evolve its GlobalLink technology platform to support crypto assets and other emerging digital instruments. It has appointed Nadine Chakar, three-decade industry veteran and executive vice president, to lead the business, dubbed State Sreet Digital.

In April of this year, State Street was appointed as the administrator of a planned bitcoin backed exchange traded note (ETN) initiated by Iconic Funds BTC in Germany. Separately in March, State Street was annointed as the fund administrator and transfer agent of the VanEck Bitcoin Trust, a new bitcoin exchange-traded fund (ETF) that is currently pending approval by the US Securities and Exchange Commission.” 



4. International – FinTech 


The Fintech Times reports: 


“Singapore headquartered fintech DigibankASIA Pte. Ltd., one of the primary incorporators of UNObank, has received approval from the Bangko Sentral ng Pilipinas (BSP) to operate a digital bank in the Philippines. 

The first fintech to receive a license outright to operate a digital bank, UNObank will be entirely regulated under the Digital Banking License framework in the Philippines. 

DigibankASIA Pte. Ltd. is co-founded by three executives who collectively have extensive experience across banking, capital markets, treasury, lending, digitalisation, and technology. UNObank will be helmed by Manish Bhai as CEO, a career banker, and tech entrepreneur. Co-founder Kalidas Ghose is a recognised fintech influencer who led the effort to build FE Credit in Vietnam from scratch and created VP Banks‘ digital bank ecosystem. Puneet Gupta, Co-founder & CTO is an acclaimed deep tech innovator known for building cutting-edge digital products and platforms.” 



5. International – FinTech 


Crowdfundinsider on some Dutch non-conformism 


“Last year, the European Union agreed upon pan-European crowdfunding rules designed to harmonize the environment for online securities offerings across all member states. Currently, each member state handles online capital formation in a different manner, regulated by national authorities thus undermining the potential for cross-border securities offerings and more efficient funding rounds. The harmonization has been described as a big win for the investment crowdfunding industry and issuers may soon raise (November) up to €5 million from 28 different member states with the backing of retail investors. 

As the regulation states, any “European Crowdfunding Service Provider” or “ECSP” must receive regulatory approval from the “national competent authority” (NCA) of the member state in which they are established to list securities offerings. ECSP’s will then be able to compete across the EU and provide cross-border crowdfunding services via a notification procedure. 

Supervision will be carried out by national authorities and with the European Securities and Markets Authority (ESMA) coordinating cooperation between EU member states. 

At the end of last month, ESMA closed a consultation on regulating ECSPs with an expectation that standards will be adopted by the European Commission on November 10, 2021, with some additional standards following on May 10, 2022. 

While the objective clearly makes sense and aligns with the mission of a single market, nuances within each individual jurisdiction may make some member states less desirable than others for ECSPs to operate and issue securities. 

This past week, the Netherlands issued draft plans for the implementation and execution of crowdfunding. The approach by Dutch regulators may make the country less competitive when it comes to online capital formation be it equity offerings or debt financing, at least according to one industry insider.”