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neobanking

Mar 01 2021

Messenger-Based Neobank ZELF Raises $2 Million Through Pre-Seed Funding Round

ZELF, a neobank that provides financial services through online messengers, has reportedly secured $2 million through its pre-seed funding round, which was led by Austrian venture capital fund 3VC, with Seed X and Hard Yaka 

Founded in 2017, ZELF claims to be the first bank in messengers. The bank’s services work in Facebook Messenger, WhatsApp, Viber, LINE, Telegram, and WeChat and uses get full control over their money from the messenger of their choice.

“To send and receive money users create an account for free and within 30 sec get a virtual card, delivered to Apple Pay, Google Pay and Samsung Pay. Besides unprecedentedly fast onboarding new clients enjoy AI-powered voice control over all operations with their money (commands like “Show me my balance”, “Create invoice for 50$”, “ask dad for 100$”, “Show me my expenses for November”) or use ergonomic button interface, all without leaving the messenger.”

According to Verdict, ZELF does not have any physical branches or a standalone mobile app. It is strictly through messengers. The company has also scrapped physical bank cards, stating that customers may receive a digital Zelf card and open an IBAN account in less than 30 seconds.

ZELF will notably be using the funds to expand its services in Spain, Germany, Poland, and Italy as well as establish its presence in the UK and U.S.

Source

Written by bizbuildermike · Categorized: Crowdfunding · Tagged: 2017, apple, apple pay, Bank, company, digital, Facebook, facebook messenger, financial services, fintech, fund, funding, Germany, Google, google pay, investment, Italy, LINE, messenger, messenger-based, Mobile, mobile app, money, neobank, neobanking, poland, pre-seed, Samsung, SEC, seed, spain, Telegram, uk, Venture Capital, whatsapp, work, zelf

Jan 02 2021

Fintech Professional Says Challenger Banks are Disrupting Banking Sector in a “Big Way” by Improving Customer Experience

Mr. Potter Banker Banking (1)

Mr. Potter Banker Banking (1)Last year, we saw many banking challengers offering services to customers who might not have been satisfied with their traditional bank. Many more people also began to use online banking services due to the COVID-19 pandemic which forced many physical business locations to shut down.

Marwan Forzley, Co-Founder and CEO at Align Commerce, a payment service provider for global commerce, notes in a blog post published by Payments Source that challenger banks are still quite small when compared to traditional financial institutions. But they’re “disrupting” the banking sector in a “big way” by changing “the fundamental and antiquated experience we’ve come to expect.”

Forzley points out that Deloitte’s “DNA of Digital Challenger Banks” report states that “challengers have developed a product offering and channel experience that targets the points of the value chain where incumbents’ weaknesses are most exposed and often not easy to fix.” In 2020, we saw Fintech challengers (like Current) offer certain services that cater to the financially underserved — such as SMEs, Millennials and underbanked consumers, Forzley confirmed.

He added that digital-only banks (like Revolut) have launched services that specifically aim to serve corporate or business clients. They may offer advanced tools and features (for example, access to working capital, accounting integrations, online wallets, and payment scheduling). These tools may be accessed from a laptop or mobile device — “without the processes, complexities or red tape that incumbents are known for,” Forzley claims.

He also mentioned that there’s a “wide open market with plenty of opportunity not just for challenger banks but for financial technology as an industry to set themselves apart from incumbents to gain market share.”

In 2020, we saw an “unprecedented” level of investment into Fintech firms, Forzley noted. He pointed out that the opportunity for growth within the payment and banking sector is driven by the need to solve or address clear problems and develop “tech-forward solutions” that are “readily available” to serve individuals and companies. He claims that VCs and incumbents are interested in funding “innovative, agile products and services that improve on the speed, accessibility and transparency issues that are widespread throughout traditional financial institutions.”

He concluded:

“[The] winners will be determined by how novel their offering is. In order for the leaders in the space to survive against incumbents and against each other, challengers will need to focus on ensuring their services are more innovative and different compared to what exists today. If the service is going to yield minor incremental changes, it won’t be enough for the challenger to truly take off. The services that will do well are the ones providing a fundamentally different and forward-thinking customer experience.”

As reported recently, digital banks and Fintech challengers must show they can generate profits, because investors are expecting returns.

Investors have been pushing banking challengers to show them how they can generate sizable profits by effectively monetizing their products and services. Industry analysts expect that the neo-banking sector will have to consider consolidation opportunities and seriously begin to focus on achieving profitability in a post COVID environment.

As covered, Fintech adoption is on the rise globally with over 250 digital banks operating in major financial markets, according to a new report from Exton.

The report noted:

“On their quest for monetizing customer relationships neobanks have learned a first lesson: payment transaction fees, premium account subscription fees, or open banking commissions from brokering 3rd party services will in most cases not be sufficient to generate profits or breach beyond operational break-even. Our expectation much rather is that Neobanks will need to offer additional products to jump the gap to sizable profitability.”

The report added:

“Irrespective of which path neobanks will take, we remain convinced that they will need to shift into profitability mode quickly as investor patience will not be unlimited. But for those that select the paths right for them, stay focused on it and grow up as an organization, the future remains bright and full of opportunities.”

Exton suggests that some Fintechs or neobanks may want to consider offering digital or lending services which should help them diversify their business. Financial technology firms can also look into developing their own super app or offer investment services to the mass affluent market, Exton noted.

Source

Written by bizbuildermike · Categorized: Crowdfunding · Tagged: 2020, Adoption, AIM, align commerce, Analysts, Banking, banking challenger, Banks, blog, breach, business, ceo, challenger, Challenger Banks, Co-founder, consumer behavior, covid-19, digital, digital bank, digital banking, digital banks, digital technology, digital transformation, diversify, Environment, financial technology, fintech, fintech adoption, funding, Future, Global, going, investment, investor, lending, market, markets, marwan forzley, Millennials, Mobile, mobile device, more, neobanking, online banking, online wallets, opinion, other, pandemic, payment, payments, product, Products, red, report, returns, SMEs, Space, Technology, transaction, Wallets, working capital

Aug 15 2020

Greek Payments Firm Viva Wallet Is Reportedly Planning to Secure €500 Million to Support Digital Banking Business

Greek payments firm Viva Wallet is reportedly planning to secure €500 million in capital to support its virtual banking business, according to Reuters which cited two sources familiar with the matter.

As reported, Viva Wallet officially acquired the banking license of Praxia Bank after the completion of the share purchase agreement between AMC Oak (Shareholder) and Viva Wallet Holdings (purchaser).

The Athens-based firm has appointed Jefferies to advise on the €500 million (appr. $592 million) raise which aims to offer investors stakes in a newly established legal entity that is expected to take over Viva Wallet’s existing banking loans (according to the sources).

The sources noted:

“Viva wants to be a neobank without a loan book.”

They claim that the suggested deal has been approved or given the green light by European regulatory authorities. If the deal is finalized, it would offer a new way for smaller European banks to manage their loans. This could make it easier for them to conduct business and raise funds.

Established in 2005 by company CEO Haris Karonis, Viva Wallet intends to sell loans on its books to a special purpose vehicle (SPV) within 1 business day or 24 hours from finalizing deals with them. This should remove or lower the risk from the bank’s balance sheet, the sources said.

This newly proposed structure shows how Greek financiers have reevaluated or reassessed traditional bank funding models, after the nation’s historic debt crisis. We might see more of these new financing methods, due to the COVID-19 outbreak and resulting economic challenges.

Viva Wallet provides cloud-powered payment services in 23 different European countries. It supports payments in euros, the British pound and the Romanian leu.

In January 2020, Viva revealed that it had entered a deal to acquire Greece based digital challenger Praxia Bank, which is owned by Barclays’ former CEO Bob Diamond and David Schamis, a partner at Atlas Merchant Capital.

The acquisition of Praxia Bank was approved by the Bank of Greece this month, according to the sources.

Source

Written by bizbuildermike · Categorized: Crowdfunding · Tagged: acquisition, athens, Banking, books, business, ceo, cloud, company, covid-19, deals, debt, digital bank, digital banking, Europe, fintech, fundraising, Global, greece, jeffries, models, neobank, neobanking, outbreak, payments, risk, viva wallet

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