A third (32%) of lenders have seen an increase in borrower defaults over the last 12 months, according to new research from AI-powered transaction analytics firm, Fuse.

In a new report, Fuse has found that consumers are increasingly reliant on credit amidst rising living costs – with young people struggling the most. Over four in ten (43%) of 18-34-year-olds are reliant on credit to pay for everyday expenses and a similar number (42%) will need to borrow money in the next six months to get by.

The research also shows that a third (31%) of borrowers have been rejected by lenders due to failing affordability checks in the last 12 months. Two-thirds (65%) of lenders warn that this rejection rate has increased compared to the previous year.

The rising proportion of rejected applications has sparked concern that these potentially vulnerable borrowers may be forced to turn to higher-cost or illegal credit options – recent research from Fair4All Finance revealed that over three million people have borrowed from illegal lenders in the last three years.

It is vital that mainstream lenders are able to accurately evaluate the financial situation of prospective borrowers to ensure they have access to affordable credit options during the cost of living crisis – a time where they are likely to be most in need. Without this, many of the UK’s vulnerable borrowers could be at increased risk of longer-term debt.

With the Financial Conduct Authority’s (FCA) new Consumer Duty rules becoming effective on 31^st July, lenders are required to provide consumers with higher and clearer standards of support and protection to promote good outcomes.

Lenders must ensure they are adequately equipped to deliver the support that consumers so desperately need. However, over half of lenders (55%) admit to not being ready for the incoming rules and two-thirds of lenders (67%) claim there hasn’t been enough support from the FCA regarding the implementation of the new rules.

A key aspect of providing support to borrowers is to leverage more effective insights into borrower vulnerability and affordability, allowing lenders to identify those at financial risk, at a much earlier stage.

Products, such as Fuse’s Health Signals, have been designed to support lenders meet the upcoming Consumer Duty requirements and provide risk and compliance teams with greater insights into areas of vulnerability as well as predict arrears risk and monitor the impact of financial products on their customers.

Sho Sugihara, CEO and Co-Founder of Fuse, comments: “It is hugely concerning that defaults are spiking - with the cost of living showing little signs of easing, the situation seems set to only worsen for many. Reliance on credit is on the rise and there are potentially millions across the UK who are at real risk of falling into long-term debt and being excluded from mainstream credit options.

“In order to more accurately analyse borrower affordability and vulnerability, lenders must ensure that they are fully utilising a wider range of insights which can not only protect borrowers from defaulting but also unlock access to personalised and more appropriate credit products.

“The new Consumer Duty rules will require many lenders to consider new approaches to support borrowers and take a more outcomes-based view throughout the affordability process. However, the Consumer Duty is likely to just be the tip of the iceberg - the financial system is in immediate need of an overhaul to create a fairer, more inclusive model with vulnerable borrowers at its heart. In order for this to happen, lenders need to utilise insights into borrower vulnerability to help them identify points of need before it is too late.”  

The Health Signals platform is highly-scalable and easily integrated with an organisation’s current systems. The algorithms have been trained on over 400 million proprietary data points collected specifically for retail lending, including transactions, lending decisions, and credit reports. 

XS.com, the global fintech and financial services provider, has today announced another addition to a long list of new hires as the firm expands its global presence.

Sixtus Ughamadu has joined the award-winning broker as the new Country Manager for its Nigeria operations.

Ughamadu has over a decade of experience in the financial services industry and will be reporting to Wael Hammad, Chief Commercial Officer (CCO) at XS.com.

Ughamadu will primarily focus on enhancing income generation in Nigeria by creating and executing business plans that are in line with the global multi-asset broker’s overarching aims and targets in both established and emerging markets. 

"I am thrilled to introduce Sixtus Ughamadu as our recently appointed Country Manager for our Nigeria operations. With a wealth of expertise gained over numerous years in the finance and FinTech industries, along with an established history of accomplishments, I have full confidence that Sixtus will offer a unique viewpoint and innovative concepts. I eagerly anticipate collaborating closely with him to sustain our business's momentum and achieve outstanding outcomes for our esteemed traders, collaborators, and stakeholders.” said Wael Hammad, Chief Commercial Officer (CCO) at XS.com.    

Sixtus Ughamadu the recently appointed Country Manager for XS.com’s Nigeria operations, expressed enthusiasm about joining the global brokerage: 

“I am incredibly excited to become a part of the XS Group, an energetic and inventive brokerage firm. By embracing progressive ideas in the financial services sector and prioritizing outstanding client service, we have an exceptional chance to thrive and achieve mutual success. I eagerly anticipate collaborating with a team of highly skilled professionals, whose numbers are expanding consistently, to further enhance the firm's already remarkable accomplishments in the realm of multi-asset trading and FinTech. My objective will be to propel the XS Group to new and unparalleled levels of achievement."

Sixtus Ughamadu has extensive experience working in the finance industry - as part of his new position, he will take on the responsibility of leading the company's efforts in Nigeria, with the aim of generating revenue throughout the African continent. This will involve supervising sales, marketing, business expansion, and customer interactions. He will foster close cooperation and partnership with various departments to establish cohesive and interconnected trading experiences.

Alveo, a leading provider of cloud-based market data management services, has announced the launch of new data modelling and data onboarding capabilities in its Ops360 platform. The new capabilities allow clients ‘own data analysts to graphically model, onboard and maintain new data sources directly from within Alveo’s Ops360 user interface, enabling them to achieve operational efficiencies. The growing range of data sources required by financial services firms and the wide variety of new content in for example ESG continues to expand. Financial services firms require a reduced cost of change and a faster turnaround time to onboard and operationalise new content in areas such as pricing, security master, ESG, index data and corporate actions.

Neil Sandle, Head of Product Management, Alveo, said: “The new data modelling capabilities enable end users to more rapidly onboard and more easily maintain integration with data sets this slashes the time to production and the cost of maintenance. Most changes in data vendor offerings come down to additional attributes and these can be easily handled by data analysts without the need for a data processing engineer. New loaders and new versions of data loaders only require loading of the metadata changes.”

The new capabilities in Ops360 are powered by Alveo’s underlying Business Domain Model Service and build on Alveo’s microservices architecture and containerisation which was released last year. In recent years Alveo has focused on improving business user self-service and the Business Domain Model Service is a key component of this.

Through its managed services and Data-as-a-Service offering, Alveo is also using the new capabilities in its customer operations to accelerate change management, improve data governance and as the basis for an intelligent exception handling process.

Flutterwave, Africa’s leading payments technology company, has joined the International Air Transport Association’s (IATA) payment orchestration platform to facilitate travel to sub-Saharan Africa. With this integration, airlines across the world are able to process payment from customers through cards, bank transfer, mobile money, alternative payment methods and other payment modes available on Flutterwave.

IATA Financial Gateway (IFG) is an omni-channel payment orchestration and management platform fully dedicated to the airline industry and has been designed to allow airlines to receive local payments from local markets through all their distribution channels. IATA has some 290 international airlines; this partnership enables them to easily expand their operations in Africa while receiving bookings and payments from customers in Africa using local and international payments methods.

Airlines and travel agencies can use Flutterwave via IFG to accept many forms of payment from customers when booking airline tickets. Instead of having to manage multiple complex connections to payment service providers in Africa, IFG offers a single global connection, with full end-to-end control on payment and settlement processes and seamless integration with ticketing systems and distribution channels.

Global airlines looking to collect local currencies through cards and indigenous methods of payments will find this integration useful, as it makes payments seamless for their millions of customers in Africa and other markets where Flutterwave operates.

Olugbenga “GB” Agboola, Flutterwave CEO & Founder, said,

“According to the International Air Transport Association (IATA), Africa is set to become one of the fastest growing aviation regions in the next 20 years with an annual expansion of nearly 5%. How can we further accelerate this growth? One way is to ensure airlines can easily set up operations across the continent and seamlessly receive payments from their customers. This partnership with IATA solves the problem of payments for global airlines venturing into Africa. We hope that this encourages more global airlines to expand into Africa.”

Muhammad Albakri, IATA’s Senior VP, Financial Settlement and Distribution Services, said, “The IATA Financial Gateway supports the availability of new payment options in many markets. We welcome Flutterwave’s participation to bring secure and innovative payment methods to airlines, travel resellers and the traveling public in Africa.”

Sonovate, the leading provider of embedded finance and payment solutions for the contingent workforce, has expanded its offering with the addition of a new solution to automate back and middle office tasks for recruitment agencies of all sizes.

The new capabilities will enhance efficiencies and streamline processes, giving smaller businesses added visibility and self-serve capabilities to allow them to have more predictability as they ramp up their business. This will also help mid-size and large recruitment agencies to work more efficiently with improved integration across their suite of tech tools, better visibility, enhanced reporting, and reconciliation.

One of the standout features is automated invoicing and billing. Coupled with quick funding, it will help ensure margins are received faster and workers are paid promptly. This new offering, which is an enhancement of the new platform that Sonovate announced earlier this year, integrates timesheet management and financing, where businesses can send, track and automatically chase timesheets then make payments accordingly. In offering a complete solution, Sonovate eliminates the need for agencies to use different vendors and disjointed systems, further strengthening its position as a disruptor in the recruitment sector, and a leading provider of technology and financing services. 

The platform also delivers best-in-class supplier and client management as well as the latest technology for fraud prevention and credit control.  

Agencies can opt for end-to-end funding and back and middle-office solutions, make multi-sector, multi-country placements more easily or choose funding alone, depending on their specific needs.

The launch comes as three-quarters (74%) of medium-sized businesses agree that adopting fintech tools for payroll or accounting would help them to become more efficient, with seven in ten (71%) saying it would save them time.

Richard Prime, Co-Founder and Co-CEO at Sonovate, comments: “We hear time and time again from recruitment businesses, consultancies and online labour marketplaces how complicated and painful operations can be, and the knock-on impact it has in how operations and finance teams are able to work together more smoothly. Extending our automation capabilities, while maintaining our industry leading funding capabilities, will expedite these day-to-day processes, improving the experience for both employees and clients, and freeing up valuable resources to focus on growth.”

Melanie Forbes, Managing Director at APSCO Outsource, comments: “The global employment landscape is continually evolving, and recruiters are under constant pressure to keep pace. Often this means adapting business models and ways of working to stay competitive, and this latest offering from Sonovate provides business leaders in our industry with the tools needed to save time, enable their teams to work more effectively together, and ultimately, supercharge growth.”

Sonovate, will continue to provide flexible funding solutions as its core offering. The company offers up to 100% invoice financing, empowering businesses to request funds as needed, maintain full visibility into funding limits, and manage cash flow effectively. Sonovate's technology integrates with accounting software to ensure accurate financial reconciliation.

Large companies are typically using over 1100 SaaS applications to run their operations and the number of companies adopting this trend is rapidly growing 20% every year but this presents a number of risks. Helping them manage their SaaS estates and mitigate risks, SaaS operations(SaaSOps) platform Zluri is today announcing a $20M funding round. The Series B funding round was led by Lightspeed, with participation from existing investors including MassMutual Ventures, Endiya Partners and Kalaari Capital. The company has now raised $32m in total venture funding since 2020.

The rapid expansion of SaaS products in large companies poses significant challenges for IT and security teams, making it increasingly difficult to manage and orchestrate SaaS operations. Alongside this, the unstoppable wave of enterprise digital transformation, led by generative AI, swift cloud adoption, and the rise of distributed remote workforces, is ushering in a new era of complexity in SaaS operations. 

“The Enterprise SaaS consumption trends have led to underutilized licenses, compromised security, ineffective governance and overall suboptimal management of SaaS stacks for IT and Security Teams,” commented Ritish Reddy, Co-Founder of Zluri. “We have fearlessly been building Zluri to scale for the needs of our community and have added a range of features to protect these companies and help them grow. Having launched and scaled our discovery engine in 2020 to help companies understand their SaaS stacks better, we have since launched an identity governance tool to manage access and now are launching the Zluri co-pilot to help enable faster workflows.”

Zluri’s comprehensive SaaSOps platform for IT teams helps companies discover, manage and optimize, secure and automate SaaS applications from a single dashboard. In addition to this, the Identity Governance tool will help teams streamline on/off-boarding, access request management and offer access audits. The new Zluri CoPilot feature will help teams converse with their data and create workflows i.e making offboarding users much more efficient. 

Zluri works with over 250 customers globally which include prominent names such as Monday.com, Tipalti, Whoop, Catapult Sports, Razorpay, Smartnews, Amagi, Daxko, Traveloka etc.

With the new funding round,  Zluri will expand Generative AI capabilities in enterprise SaaSOps with Zluri’s CoPilot - an intelligent assistant to boost efficiency and productivity across enterprises using no-code workflows. Zluri has built a custom large language (LLM) model trained on billions of data points encompassing a wide range of attributes. 

Zluri's expansion plans include continuing to scale go-to-market teams in North America and Europe to reinforce their presence in strategic markets, and fostering closer collaboration with customers. By establishing a stronger global footprint, Zluri aims to provide exceptional support to its growing customer base while actively seeking opportunities to forge new partnerships and drive innovation in the realm of SaaS management and Identity governance.

“We are excited to partner with the Zluri team as they revolutionize SaaS management and identity governance for large enterprises and mid-market firms in the US and globally. They have demonstrated strong market traction, driven by an innovative architecture addressing the twin drivers of cybersecurity and pressure on IT to reduce cost." Dev Khare, Partner, Lightspeed

Since their Series A in January 2022, Zluri has doubled the overall team size,  made deep in-roads in the US market including setting up an office in California and launched new products expanding their offerings from a single product to multi-product for both enterprises and mid-market companies. 

“ARC is a group of 16 unique companies with varying tech stacks. Zluri has enabled us to understand usage and uncover shadow IT so that we can understand which tools are being used per capability. They have also helped us cross reference our spends against usage which helps us determine which SaaS apps are giving the most business value. We are currently in the process of connecting our HR system to allow for automatic provisioning/deprovisioning of SaaS apps and licenses. It has been a great tool for us and we look forward to a long partnership working together" Kyle Hitchcock - Head of IT, ARC Group

Zluri puts the IT team back in control of their new SaaS-ified landscape. Zluri has the most comprehensive application discovery engine in the industry and the largest library of over 800 in-depth direct integrations. 

CapStack, a startup formed by Pipe co-founder Michal Cieplinski, has raised $6 million toward its effort to build an integrated operating system for banks.

In simpler terms, Cieplinski described CapStack as the “first bank-to-bank marketplace,” giving the institutions the ability to share and have visibility into one another’s portfolios.

Cieplinski started CapStack in March with Tzvika Perelmuter and, interestingly, says they managed to raise the capital almost immediately after launching the company and right before the meltdown of Silicon Valley Bank — not only pre-revenue, but pre-product.

“Something I saw is that banks are islands,” Cieplinski told TechCrunch in an interview. “Each bank operates on its own and there is no connectivity…And they’re all searching for an ability to diversify capital sources.”

Small and mid-sized banks in particular, said Cieplinski, are limited by geographical footprint with most of their customers residing near a bank branch.

“We don’t necessarily realize how serious that is,” he said. “Especially because small and mid-sized banks are not investment banks — they don’t get money other than deposits.”

What Cieplinski envisions building would give not only these banks, but larger financial institutions as well, a way to invest deposits and loans and “de-riskify their portfolios.”

“Over 60 banks agreed to join the platform even before the first line of code was written and a single employee was hired,” Cieplinski said. “And with that I went to VCs.”

Fin Capital, which also was a lead investor in Pipe, led CapStack’s round, which also included participation from Alloy Labs, Cambrian Ventures, Cowboy Ventures, Future Perfect Ventures, Gaingels, Selah Ventures, Uncorrelated Ventures and Valor Equity Partners.

Cieplinski transitioned from his role as chief business officer to a senior advisor at Pipe at the end of February, a few months after the alternative financing startup made headlines for the rest of its co-founders stepping down at the same time amid a hunt for a new, “veteran” CEO. Pipe, which had raised more than $300 million in funding and was once valued at $2 billion, was the target of a number of allegations surrounding its use of capital — all of which the company vehemently denied.

With CapStack, the executive — who also co-founded Fundbox and is a former SVP of LendingClub — says he wants to give financial institutions the ability to host on CapStack’s platform the loans that they originate and the ability for other banks to participate in those loans, borrow/move each other’s deposits and to see what other assets another bank might have that they can invest in so they can “diversify risk and exposure into other non-correlated assets.”

In the banking sector, explained Cieplinski, there are institutions which originate great assets, such as loans, but may not have enough capital to fund them — such as small and mid-size banks. Then there are larger banks, which sit on massive deposit bases but have “no way of originating loans” because they don’t have relationships on the ground.

“My TAM is effectively all the banking systems in America, sub the Top 30. But even some of the top 30 banks want to be buyers of these assets too,” Cieplinski said. 

Fin Capital founder and managing partner Logan Allin, who has joined CapStack’s board, said in a written statement that he believes CapStack has the opportunity “to dramatically improve solutions for bank risk management at a critical time for the stability of our country’s banking infrastructure.

“Banks still rely on legacy technology for managing risks around their balance sheets, and to restore confidence for consumers, commercial customers, regulators, and other stakeholders, they absolutely need an upgrade,” Allin added.

Cieplinski is targeting the fourth quarter or first quarter of 2024 to perform the first beta testing with design partners.

“Everybody knew what was happening with SVB — it had an over-concentration of assets,” he said. “Every single one of the banks that want to join the platform are also over-concentrated in some assets — some of them have too much deposits, and they don’t know how to deploy it, but they need to provide the return to their depositors to the customers.”

MerQube, a pioneer in technology for next-generation index-linked investing, announces USD 22 million raised in Series B funding. The investment round was led by Intel Capital with participation from new investor Allianz Life Ventures, and existing investors Citi, J.P. Morgan, Laurion Capital Management and UBS. In conjunction with the financing, David R. Mueller, Intel Capital Investment Director, will join MerQube’s board of directors.

The “index-linked investments” market, valued at USD 17 trillion today, is evolving rapidly with assets expected to reach USD 30 trillion by 2027.1 This growth continues to accelerate demand for customization, flexibility, scale and speed to market, driving the transformation of traditional passive investing and raising the need for state-of-the-art technology and computational capabilities. MerQube’s cloud-native SaaS platform and API-first solutions are designed and builtto address and unlock this unmet demand. Its data ingestion framework and building block approach creates the unique computational agility required to process extensive amounts of data from a vast array of sources, and deliver cost-effective, rapidly implemented solutions.

“We are thrilled to welcome Intel Capital and Allianz Life Ventures as investors”, said Vinit Srivastava, CEO at MerQube. “The support of a leading technology V.C. firm such as Intel Capital will be instrumental as we deliver on our vision to close the fintech gap in passive investing by providing the best technology available to enable innovative rules-based investment solutions. The participation of a powerhouse such as Allianz Life Ventures will provide strategic direction in the insurance market as we continue to expand to meet the needs of a diverse client base.”

“The surging market demand for sophisticated tailored indices can be effectively delivered by a cloudbased and API-centric architecture,” said Sunil Kurkure, Managing Director at Intel Capital. “We believe the next wave of innovation in rules-based investing will be driven by customization at scale to meet diverse investor requirements and drive cost efficiency. MerQube’s technology puts itin a unique position to deliver the solutions this trend will require. Intel Capital is delighted to collaborate with MerQube on this next phase of their journey.”

In May 2023, MerQube received FCA authorization under Benchmarks Regulation (BMR) and in September 2022, it confirmed its adherence to International Organization of Securities Commissions (IOSCO) principles for Financial Benchmarks. MerQube’s other recent accomplishments have included assuming calculation and administration services for the UBS CMCI index family, a family of 1,100+ of UBS’s most innovative commodity indices. MerQube is also the benchmark provider for most of the defined outcome ETFs issued in the USA.

MerQube plans to utilize the funds raised to further expand its engineering capabilities and platform infrastructure, scale its talent, and continue to expand into its key markets.

Wilson Sonsini Goodrich & Rosati acted as legal counsel to MerQube.

Leading European Embedded InsurTech hepster secures €10 million of new financing which will be deployed to support hepster’s continued expansion into new markets, delivering continued sustainable growth and securing hepster’s pathway to profitability. hepster offers an API-driven ecosystem that enables companies from all industries to seamlessly integrate needs-based customised insurance into their digital customer journeys. hepster is headquartered in Rostock, Germany with operations in Germany, Austria and France. 

hepster has received €10 million ($11 million) in a Series B financing round from existing and new investors with Element Ventures, Seventure Partners, and Claret Capital Partners (Fund III1). The new capital consists of equity and debt.  

Despite a challenging fundraising environment, thanks to its continuous growth and the expansion of its market positioning, hepster was able to successfully close another financing round with existing and new investors. Investors were attracted to the very positive development of all hepster’s key performance metrics, its innovative approach of platform extensions and hepster’s strong momentum in securing compelling B2B partnerships especially in the high-growth areas of mobility and the circular economy. Most recently, hepster secured new, significant enterprise partnerships, further cementing its position as one of the leading embedded insurtechs in Europe. 

Christian Range, CEO and Co-Founder of hepster, on the financing round: “We are delighted with the unreserved trust of our existing and new investors, but also the trust of our entire team, which has delivered an outstanding performance over the last seven years." 

Antony Baker of Claret Capital Partners adds: “We, as adviser to the fund, are delighted to have backed hepster alongside the other investors. The insurance market is increasingly becoming digitised, automated, and simplified and companies need to depend progressively on additional offerings for their customers. That's where hepster comes in with Embedded Insurance." 

Michael McFadgen of Element Ventures adds: "Our decision to continue to support hepster is based on their promising business model, but more importantly on the cooperation we have had so far. With their focus on embedded insurance, hepster has been able to establish a strong market position. Therefore, we see further growth potential for hepster and look forward to the upcoming developments of the company" 

The investment confirms that even after seven successful years in the insurance market, the founder trio of Hanna Bachmann, Alexander Hornung and Christian Range has chosen the right path. 

Gatehouse Bank has been named the Best Fixed Account Provider at the 2023 Moneyfacts Awards.

The Shariah-compliant ethical Bank was awarded the title for the second year in a row following detailed weekly data analysis by Moneyfacts’ research team. The winners were those who stood out for their competitive rates and a high level of service.

Gatehouse Bank’s Fixed Term Woodland Saver and Cash ISA accounts have consistently provided competitive rates while giving back to the environment. For every account opened or renewed, the Bank plants a tree on behalf of the customer in a certified UK woodland project. As a Shariah-compliant Bank, Gatehouse does not invest in industries perceived to cause harm to society, such as alcohol, adult entertainment, gambling, tobacco or the arms industry.

Lee Tillcock, Managing Editor at Moneyfacts Group plc, commented: “We are pleased to have awarded Gatehouse Bank with ‘Best Fixed Account Provider’ for their continuous hard work in providing competitive rates across a range of their savings products. In particular, their Fixed Term Woodland Saver accounts, which support the creation of new woodlands while helping customers achieve a competitive return on their savings.”

Ravi Kumar, Senior Product Manager at Gatehouse Bank, commented: “We are delighted to have been named the Best Fixed Account Provider for the second year and would like to thank the Moneyfacts team for their consideration.

“At Gatehouse Bank, we take our responsibility to the community and the environment seriously and pride ourselves on our customer-first approach. We are very pleased that our hard work has paid off and we have been recognised by a prestigious organisation such as Moneyfacts.”