Paga Group, a leading mobile payments and financial services company, is delighted to announce its partnership with the Bank of Abyssinia, and its receipt of regulatory approval from the National Bank of Ethiopia to launch its online payment gateway in Ethiopia.

Paga’s partnership with the Bank of Abyssinia is both a milestone and a core, strategic development in Paga’s growth strategy. Established in 1996, and with close to 700 branches and over five million customers, the Bank of Abyssinia is one of Ethiopia’s leading banks. It is also a pioneer in Ethiopia of digital finance and payment solutions. 

Adam Abate, CEO of Paga Ethiopia, commented:

“Ethiopia is on the cusp of a digital transformation. Paga has a long history working in Ethiopia, and we are very excited for this next phase of our involvement in Ethiopia, where we can provide innovative payment and financial services to the market. We are equally excited to be partnering with the Bank of Abyssinia, which has demonstrated its commitment to and capabilities in driving Ethiopia’s digital economy forward. Combined with Paga’s innovation and technology, we believe our offering will be very exciting for Ethiopian consumers and businesses.”

Sosina Mengesha, Chief Digital Banking Officer of Bank of Abyssinia, said:

“As one of the leading banks in Ethiopia, we always seek to work with best-in-class partners, and we have chosen such a partner in Paga. Their product innovation and commitment to financial inclusion stands out, and we are delighted to come together to empower their delivery of online payment gateway services to Ethiopian consumers.”

Through its online payment gateway and other capabilities, Paga will help drive the digital economy in Ethiopia by enabling sellers to pay and get paid easily online. Paga will leverage its experience and international partnerships to deliver world class online payment services.

Custonomy, an award-winning digital asset custody service firm, has completed a seed round of US$2 million. Crypto Asset Management Firm Babel Finance, prominent worldwide crypto financial services provider, led the seed funding round.

Custonomy's next phase of expansion will be fueled by seed money. The funds will be used to further the company's ground-breaking, institutional-grade, ultra-secure corporate management systems for crypto asset management using multi-party computation technology (MPC). The emphasis will be on assisting businesses in providing best-in-class security solutions to protect crypto assets from cyber theft.

Custonomy was founded in April 2020 as a seed-stage company in response to a rising need among investors and asset owners to secure their crypto assets from internet theft. More and more businesses and institutions have become involved in the crypto-asset market in recent years, allowing their customers to hold and invest in cryptocurrencies. Babel Finance's crypto team sees the growing desire from investors to own and trade these assets and is aware that asset security threats are a serious concern for investors.

Keith Hung, CEO, and Co-Founder of Custonomy, commented on the seed fund closure: "Custonomy's mission is to be the cornerstone and go-to solutions provider for enterprises that want to get involved in crypto and the metaverse. We are delighted to close this seed round of funding and now look forward to focusing our collective team efforts on being Asia's No. 1 crypto custody solution provider."

The goal of Custonomy is to improve business digital asset protection. It offers ultra-secure custody solutions based on MPC technology that allows institutions to manage their digital assets in a secure and self-contained environment. Enterprises have the opportunity to innovate with true value-added client services by utilizing cryptography and mathematically-based procedures. It also permits them to stay up with the market's quick developments. Babel Finance's crypto lending arm will be able to leverage the use of Custonomy's custody solutions.

Babel Finance's CFO, Edmond Lau, remarked from Babel Finance's Hong Kong office, "We are very impressed with the technical capability, innovative solution, and supreme execution power of Custonomy." "We are proud to support Customony on the journey to provide the best possible solution to institutional clients."

Custonomy also revealed that its solutions are now available to all clients on a broad scale. In 2022, with the seed funding led by Babel Finance, Custonomy intends to improve its solutions so that businesses may manage their NFT assets in a highly secure and user-friendly manner.

 

• £14bn was invested over the first three quarters of 2021, a 130% increase on the £6.1bn invested over the same quarters in 2020.
• Investment in the first three quarters of 2021 exceeded the £8.7bn invested in the whole of 2020, itself a record at the time.
• Clean tech investment reached £572m in Q1-Q3 across 147 deals, the latter already higher than for the whole of 2020.
• 58% of 2021 VC deals involved overseas investors, up from 50% in 2021.
• VC financial returns continue to improve driven by strong exit activity in 2021, including several high-profile public listings.

Judith Hartley, CEO of British Patient Capital, said: “The British Business Bank’s Small Business Finance Markets 2021/22 report, published today, shows what an extraordinary year 2021 was for equity investment. With £14bn invested during the first three quarters of the year alone, it has already surpassed the total for the whole of 2020.

This surge in equity financing is testament to the growing strength and innovation of UK companies, where start-ups and scale-ups across a range of sectors are attracting record levels of capital.

For example, the cleantech sector is attracting increasing levels of investment. With the drive to net zero now firmly established on the corporate agenda, investment into this sector is becoming a commercial reality. Between January and the end of September 2021, 147 cleantech deals completed – a record high – and £572m of equity was invested, a figure likely to rise and surpass 2020’s total of £679m when the full-year figures are published later this year. In British Patient Capital’s own underlying portfolio, we have a number of businesses operating in the sector, such as Xampla, a developer of a plant-based alternative to plastic, and Nyobolt, creators of a new battery technology which delivers high power and ultra-fast charging.

What is especially noteworthy is that the investment in this sector is not just coming from specialist institutions – those with a focus on environmental and/or social impact businesses – but increasingly from non-specialists as well, reflecting a clear and growing awareness of the importance of tackling the climate crisis.

The findings of the Small Business Finance Markets report are further evidence that the UK is a great place for starting and growing a business. We have the VCs, the entrepreneurs, the workforce, the infrastructure and the culture to produce outstanding, dynamic and highly innovative companies.

However, we do still lack home-grown institutional investment. The report shows that 58% of the VC deals completed in 2021 involved overseas funds, up from 50% in 2021. Whilst international interest is still to be welcomed, it is vital that we continue to strengthen the UK market for venture growth funds by encouraging more investment from domestic institutional investors. In this way, ambitious growth-stage founders will have access to a diverse source of patient capital even when global markets may be less buoyant. UK institutional investors, such as pension funds and the individual savers they serve, would also have an increased opportunity to both drive and benefit from the success of our high-growth companies.

The UK is fertile ground for innovation to thrive but a lack of access to patient capital does hold back some companies from scaling up and fulfilling their commercial potential. As the UK’s largest domestic investor in UK venture and venture growth opportunities, we increase access to and availability of this type of long-term patient capital finance, to help build the country’s innovation economy.

PollenPay, the Manchester-based ‘Buy Now, Pay Later’ (BNPL) company has officially launched in the UK. The company’s mobile-based application is now available as a free download for all customers aged 18 or above, via Apple’s App Store.

PollenPay’s new mobile application will give its customers more flexibility when making payments. The exciting BNPL technology aims to ease pressure on purchases, by spreading payments and enabling greater levels of financial responsibility among its users. For boutique businesses, PollenPay’s service can also ensure greater cashflow management.

Highlighting the immense demand for its service, PollenPay’s new mobile application has already been downloaded over 1,000 times in just a few days of being live. Likewise, PollenPay already has more than 250 merchants on board, across a diverse collection of sectors. This immediate success has far exceeded the company’s internal predictions, putting PollenPay in a position for strong growth in 2022

Underpinning PollenPay’s early success has been the company’s stringent know-your-customer (KYC) checks, as well as its human-centric core values. Unlike other businesses in the sector, PollenPay prides itself on promoting financial responsibility among its users. To this end, the company enacts effective protocols to ensure customers don’t accrue mass debts on its platform and offers real flexibility on repayment terms.

Likewise, with its stringent KYC checks, PollenPay has employed a robust and secure system that accurately assesses whether an individual qualifies for its initial £250 credit limit, without the need for a full-scale credit check.

Speaking on PollenPay’s successful launch, founder and CEO, Leon Wilson commented: “We are thrilled to launch the PollenPay App on the Apple app store. Our solution is helping to give everyday people more flexibility when making payments and offers a more responsible approach to BNPL transactions, which we believe can be used to elevate levels of financial responsibility across the UK.”

You can download the PollenPay app on iOS here.

Businesses should take action to review their due diligence and sanctions screening procedures to avoid falling foul of extensive new sanctions against Russia, according to an anti-money laundering expert.

The sanctions include restrictions against individuals, entities, and their subsidiaries, and the introduction of legislation to limit deposits held by Russian nationals in UK bank accounts to £50,000.

Commenting on what this will mean for businesses in the UK, Collette Allen, client services director at leading anti-money laundering specialist SmartSearch, said that it will be essential for companies to ensure that any individuals and organisations they are dealing with have not become subject to newly-imposed sanctions.

“These sanctions are extensive, and have implications for a wide range of businesses in the UK. Not only are companies banned from making funds or other economic sources available to sanction targets, but they also cannot deal with intermediary financial institutions through which funds could pass.

“In order to avoid breaching sanctions, businesses should be undertaking fresh due diligence and screening to ensure that they are not transacting with individuals or organisations that are subject to the new sanctions.

“Any regulated companies which are found to have contravened the sanctions brought in by the government against Russia could face action, including hefty fines, from regulatory organisations such as Office of Financial Sanctions Implementation (OFSI).”

Ms Allen cautioned that the newly introduced sanctions mean that it is not enough for companies to have successfully screened a client at an earlier date.

“Businesses need to ensure they are using electronic verification so they can screen clients to see if they are on sanctions or politically exposed person’s (PEP) lists,” she said.

“In order to do this effectively, they need to ensure that the electronic verification platform they are using includes a monitoring system. For example, the SmartSearch platform provides alerts if any person or entity already on the system is among those targeted by the new sanctions.

“It is clearly no longer enough for businesses to undertake client onboarding using old-fashioned methods, as it cannot ensure proper screening against sanctions and PEP lists. This approach is also unable to constantly monitor for status changes following the introduction of new sanctions, and without alerts businesses are unable to immediately cease transactions linked to the flagged entity.”

For more information about anti-money laundering solutions in the UK, please visit www.smartsearch.com

Crypto exchange giant Coinbase finished 2021 with a strong Q4 performance across its user-related metrics.

• Trading volume was $547 billion, up about 67% quarter over quarter (QoQ), when it was $327 billion, and soaring by around 515% year over year (YoY), when it was $89 billion.
• Monthly transacting users (MTUs) hit 11.4 million, up around 54% QoQ from 7.4 million, and surging YoY by about 307% from 2.8 million.
• Assets on platform reached $278 billion, an approximately 9% QoQ increase from $255 billion. However, they rose by about 209% YoY, from $90 billion previously.

Surging profit and revenue: The user-side growth was coupled with skyrocketing net revenue and profit.

• Net revenue hit $2.49 billion in Q4, a QoQ spike of about 102% from around $1.24 billion, while YoY growth was approximately 401%, up from $497 million.
• Profit more than doubled QoQ, with net income going from $406 million to $840 million. It also rose by about 375% YoY, from $177 million at the end of 2020.

Problems ahead: So far, Coinbase’s year-end momentum isn’t carrying over into 2022, per the company’s Q1 outlook.

• Declining crypto market capitalization (20%) and lower volatility (10%) is pinching the exchange.
• It projects falling QoQ MTUs, at about 10 million on average.
• It anticipates a QoQ trading-volume slump, giving a figure of about $200 billion.

The company’s full-year outlook is mixed:

• Its average transaction revenue per user (ATRPU) is expected to be less than its 2021 levels.
• It anticipates improved subscription and service revenue versus 2021.
• But it gave a wide range for annual average retail MTUs, of 5 million to 15 million, calling it “premature” to give one that’s more detailed.

The big takeaway: Coinbase’s choppy QoQ performance underscores the need to further diversify and expand its offerings beyond routine crypto trading while it waits for regulators to clear the way for mainstream crypto adoption.

• It’s already showing some positive momentum in this respect: 32% of its MTUs in Q4 used non-investing products in addition to investing products, which increased from 22% a year earlier.
• The company cited usage of Earn and Staking as helping to drive this trend, pointing out that the offerings have higher retention rates than investing.

Coinbase said it has two non-investing strategic pillars, in addition to bolstering its investing operations. That should help buffer its user metrics against market volatility.

• It will push “crypto as a financial system” through initiatives like broader access to its Coinbase Card, a rollout of crypto-backed loans, and its recently launched fund-transfers product from the US to Mexico.
• It also plans to push “crypto as an app platform,” which entails investments in Web3 applications—Web3, it said, “represents a decentralized, community-governed internet with modern functionality.” This means simplifying its Coinbase Wallet and adding features to it, and launching a non-fungible token (NFT) marketplace called Coinbase NFT.

Coinbase’s diversification could lead it into neobanking for consumers—perhaps by teaming up with a banking-as-a-service (BaaS) to power the products—which could enhance its user engagement. Its strong brand recognition as a market leader (that memorable dancing QR code Super Bowl ad didn’t hurt) could also help further Coinbase’s future evolution into a digital financial institution with a large breadth of offerings.

●      The additional funding extends Payhawk’s Series B round to $215m. This comes only three months after the first wave of Payhawk’s Series B, which was the second largest Series B for a B2B company in Central and Eastern Europe

●      The company has raised an additional $100m in a round led by Lightspeed Venture Partners at a valuation of $1bn. As a result, Payhawk becomes the first ever Bulgarian unicorn

●      The previous round in November 2021 valued the company at $570m. After continuing to double its annualized recurring revenue every quarter, the valuation is set to hit $1bn

●      New investors joining the round are Sprints Capital, Endeavor Catalyst, HubSpot Ventures and Jigsaw VC. All existing investors including Greenoaks, QED Partners and Earlybird Digital East are participating

●      The fintech will use the funds to further grow its product team, double down on its efforts to build best-in-class enterprise features, and expand the sales and marketing team for new market penetration in 2022

Payhawk, the payment and expense solution with offices in London, Sofia, Berlin, and Barcelona, has raised an additional $100m to extend its Series B round to $215m. The Series B extension means that the company hits a valuation of $1bn, making Payhawk the first ever Bulgarian company to achieve unicorn status. The company plans to become a catalyst for the Bulgarian startup ecosystem, and continue to attract and retain the top 1% of talent in the market.

Lightspeed Venture Partners -- a leading global venture capital firm with over $10.5bn under management and prior investments in companies like Affirm, Grafana, Faire, FTX, Personio, Snap, and others -- leads the funding extension, with Sprints Capital, Endeavor Catalyst, HubSpot Ventures and Jigsaw VC also joining the round.

The additional funding comes only three months after Payhawk announced the initial tranche of Series B funding in November 2021 of $115m^[1], and less than a year after its $20m Series A round in April 2021. With the extra funds, Payhawk now has the financial clout required to aggressively expand its presence in the mid-size enterprise market and continue its ambitious global expansion plans.

Currently, finance teams still do a significant amount of manual work due to multiple disconnected tools for cards, payments, invoices, and expense management. Payhawk reduces this by combining those key elements in a single platform. The company also provides an industry-first 3% cashback on card payments up to the full subscription amount, enabling customers to drive their subscription costs to zero, while benefiting from enterprise-grade software.

Payhawk emerges as the leading platform for large SMEs and enterprise customers, especially those with a multinational footprint. The company serves businesses in 30 countries across a variety of industries, currencies and payment methods.

The fresh capital will be used to further grow Payhawk’s product team by adding 60 additional senior software engineers in Sofia from the top 1% of the market. This is with the aim of meeting growing customer demand for new features  like mileage tracking and per diem, in light of the incremental return of business travel. Other existing features for enterprise customers will be extended too, including Oracle Netsuite integration, Subscription Management and Budgets.

Building on the momentum from the first influx of Series B capital, Payhawk is set to open offices in Amsterdam and Paris in March, and in New York in September. The company’s headcount is also set to triple from 100 to more than 300 by the end of this year, with the extra funds set to fuel a renewed sales and marketing push for further market expansion.

Arsham Memarzadeh, Partner at Lightspeed Venture Partners, said:

“Payhawk is more than just spend management software. It’s a one-stop-shop for finance teams to consolidate the previously disparate systems required to spend, track, process, and budget corporate funds. After getting to know the team for over a year, we've been blown away with their pace of product development, building the most comprehensive solution in the market in less than four years.”

Hristo Borisov, CEO and Founder of Payhawk, said:

“We always knew that we could build a big company if we addressed a significant problem in a large market. The size of the opportunity still drives our growth and ambition today. Every employee that deals with company payments feels that there should be a better way to do it, but this huge problem was never tackled by a strong product team with hardcore engineering background. This is what Payhawk brings to the market.

“Becoming the first unicorn in Bulgaria is a huge testament to the hard work and resilience of our team over the las

Capital Bank of Jordan partnered with Codebase Technologies to build Blink, the first digital-only neobank in Jordan. The project officially commenced in late 2021 and in February 2022, Blink went live for Jordanian customers.

Blink was born out of a simple belief: money is meant to be easy; it's meant to work for people, and not the other way around. Jordanians can open a Blink account directly from their smartphone with their Jordanian ID, in just 15 minutes, gaining access to an instantly issued virtual debit card and account. A physical card will be delivered directly to their chosen address. In addition, users can manage their accounts, send and receive money, view their transaction history and withdraw money from domestic and international ATMs.

Blink also offers its users instant credit cards which are issued within 3 minutes of an application and do not require a salary transfer by the customer. Blink neobank also offers its customers the highest credit card grace period in Jordan, allowing up to 60 days for settlement.

A robust product and service roadmap has been put in place that will offer Blink users new experiences and services as the neobank evolves and grows. The mobile-based neobank addresses the needs of the Jordanian market where mobile penetration stands over 90% of the total population as of 2020.

Built using Codebase Technologies' award-winning DigibancTM platform, Blink incorporates an innovative UI system based almost exclusively on swiping – similar to how millennials and Gen Zers interact with social media - the first of its kind for a neobank. Together, Capital Bank of Jordan and Codebase Technologies developed Blink’s proposition, user journeys, launch strategy, and overall user experience. Blink’s enhanced agility and efficiency will foster the growth of Capital Bank of Jordan and counter security threats, high operation costs, and lack of transparency, which are key factors in digital banking from a customer and banks standpoint.

Codebase Technologies was able to configure its modular and highly flexible DigibancTM platform to allow Capital Bank of Jordan the flexibility and freedom to create a bank offering as per their exact requirements; one that is ready for new product and service innovations in the coming months and years. Using DigibancTM’s flexible and scalability nature Codebase Technologies was able to help Blink go live in just six months from project start.

Blink’s newly appointed CEO, Zein Malhas, points out "Blink will disrupt traditional banking by addressing the existing gaps from both banks and customers’ perspectives. We’re grateful to Codebase Technologies for being a committed partner and helping us in our journey of building a neobank. The chemistry between both teams was fantastic and we’re happy the team helped us bring our vision to life so quickly and to such a high standard. We look forward to further growth in the product and expansion to new markets in the future.”

Tamer Al Mauge, Managing Director - MENA of Codebase Technologies, added “The launch of Blink was a huge milestone for Codebase Technologies in Jordan and for the market. Building and launching the first neobank in Jordan is no small feat and we’re happy to have worked on this with Capital Bank of Jordan. The collaborative effort on this project was really inspiring and we look forward to continuing our work with Capital Bank of Jordan and their amazing team.”

Report highlights how AI is used today and its future integration into the business strategies of financial services organizations 

Quantexa, the data and analytics software company pioneering Contextual Decision Intelligence (CDI), today announced the release of a report in conjunction with AI Forum, the leading independent research and information source for the worldwide Artificial Intelligence (AI) community. The State of AI in Financial Services: Global Survey Results shares findings based on a survey of over 600 senior business and technology managers in the global financial services industry, looking at how AI is being applied to various business use cases. 

The survey showed data management and relationship network understanding are crucial baselines for successful AI initiatives. One third, 33%, of respondents cited data readiness, the ability to integrate internal and external data sources and making AI operational as the top three challenges for AI adoption. 

The report also found strong early adoption, but highlighted 32% of financial services organizations saw very limited or zero return on investment. Over a quarter of respondents had either kicked off (13%) or adopted (18%) an AI program; however most (35%) said that they are in the test-and-learn phase of AI adoption, signaling that AI in the financial services industry is still ripe for mass adoption and growth. 

Other key findings include:

• Traditional AI use cases for AI in financial services, related to customer onboarding and risk detection – especially KYC, AML and fraud detection accounted for 29% of primary uses cases. However, the joint most common use cases included data managements) and customer insights, which both polled 13%. 

• Effective AI implementation is still a hurdle for organizations; the largest challenges cited were data readiness (18%), integrating internal/external data sources (15%), making AI operational (14%) and the availability of skills (14%).

• There is still room for improvement on ROI in AI initiatives; 41% of respondents said that they’re seeing good ROI from AI projects over multiple years, but only 8% cited having seen outstanding results from AI within a few months. 

“Data is becoming ever more important as organizations increasingly digitize,” said Vishal Marria, CEO and founder of Quantexa. “However, these huge waves of data often lead to decision gaps that plague organizations, leaving them unable to extract meaningful value. AI and technological advances such as entity resolution are helping close this data decision gap in a strategic and measured way, allowing organizations to connect siloed data to create a meaningful connected view, that directly leads to higher accuracy, productivity and ultimately trusted decision making.” 

"Barriers to success for AI projects can be daunting", says incoming Chair of the AI Forum Advisory Board, Ian Gilmour. "An important takeaway from the feedback from respondents is the need for an organization to work with skilled third-parties to augment in-house AI expertise and increase the probability of success. The fact that such a high percentage of firms are only in the test and learn phase speaks volumes about the gap between expectations and capability. This report provides essential input for business strategy, helping budget committees to identify and resource AI projects that deliver a competitive advantage"