The Consumer Financial Protection Bureau (CFPB) proposed today to block banks and other financial institutions from one potential source of new junk fee revenue – fees on transactions declined right at the swipe, tap, or click. The proposed rule would prohibit non-sufficient funds (NSF) fees on transactions that financial institutions decline in real-time. These types of transactions include declined debit card purchases and ATM withdrawals, as well as some declined peer-to-peer payments. The CFPB’s proposal is part of the agency’s proactive approach to protecting consumers, and it would cover banks, credit unions, and certain peer-to-peer payment companies.

“Over the years, large banks and their consultants have concocted new junk fees for fake services that cost almost nothing to deliver,” said CFPB Director Rohit Chopra. “Banks should be competing to provide better products at lower costs, not innovating to impose extra fees for no value. The CFPB will continue to rid the market of junk fees today and prevent new junk fees from emerging in the future.”

When a consumer tries to make a payment, but does not have enough money in their account, generally one of two things happens. One outcome is overdraft – the financial institution extends credit to cover the difference and permits the transaction to go through. Generally, the institution charges a fee for the overdraft loan. The other outcome is that the financial institution simply declines the transaction for insufficient funds. Generally, the institution only charges a fee for insufficient funds transactions that are processed and then declined – i.e., checks or electronic authorizations, like Automated Clearing House transactions.

Financial institutions rarely charge fees for transactions that are declined in real-time at the swipe, tap, or click. For example, a $100 grocery purchase with a debit card may be declined in real time because the account only has $90. These types of transactions are not processed like Automated Clearing House transactions and are generally not assessed fees.

The CFPB is taking proactive steps to ensure that financial institutions do not impose these fees, which can occur for a host of reasons that are out of the consumer’s control. Specifically, as technology advances, financial institutions may be able to decline more transactions right at the swipe, tap, or click. These transactions include ATM, debit or prepaid card, online transfer, in-person bank teller, and certain person-to-person transactions.

Banks have previously increased fees when technology provided an opportunity. Overdraft fees are a prime example, and last week, the CFPB proposed a rule to close the overdraft loophole that had allowed banks to capitalize on technological changes and charge consumers billions of dollars in overdraft fees every year.

Today’s Proposed Rule and the CFPB’s Junk Fee Efforts

The CFPB’s proposed rule would consider fees for transactions declined in real time to be unlawful under the Consumer Financial Protection Act.

The proposed rule is also just one part of the CFPB’s multi-front work on protecting consumers from unlawful NSF and other junk fees. In early 2022, the CFPB launched an initiative to scrutinize junk fees. Following the CFPB’s junk fee work, many banks and other financial institutions have reduced or eliminated excessive NSF fees. The CFPB expects consumers to save $2 billion annually from these changes.

The CFPB has also taken more direct action against unlawful NSF fees. In July 2023, the CFPB ordered Bank of America to pay more than $100 million for, among other unlawful behavior, double-dipping on NSF fees. Also in 2023, the CFPB’s supervisory work resulted in financial institutions returning $120 million in illegal overdraft and NSF fees to consumers. The CFPB will continue using its range of tools and authorities to eliminate unlawful NSF fees and take action against lawbreakers.

BlueSnap, a leading provider of global payment solutions, today announced Sharon Weiss has joined BlueSnap as General Manager, Israel, and EVP of R&D effective immediately. Weiss appointment comes as long-standing GM, Israel and EVP of R&D, Meir Gefen, has decided to retire from his role following 9 years with the company. 

“I want to thank Meir for his tireless dedication and contributions to BlueSnap and the Israeli team, “said Faouzi Kassab, Chief Technology Officer at BlueSnap. “I am confident the team will continue to thrive under the leadership of Sharon as they move towards BlueSnap’s future phase of growth, building the next generation of products and services to meet our clients growing global payment needs.”

Sharon Weiss joins BlueSnap with more than 20 years of experience in R&D, product management, software development, and software architecture. He comes to BlueSnap with deep expertise in executive management and technical leadership. 

Most recently Weiss was CTO & GM at Minute Media for eight years where he led their Israeli office, grew the organization, and implemented structure and process for a scalable and more efficient way of work for R&D and for the entire company. Prior to Minute Media, Weiss was Co-Founder at TookTook, CTO and VP R&D at Seeking Alpha, and CTO and VP R&D at Walla, Israel’s largest website. Additionally, he has served as a board member for various companies and co-founded 2 start-ups. 

“BlueSnap has a clear vision for the future, and I am excited to be a part of their next chapter leading the Israeli team,” said Sharon Weiss, new BlueSnap General Manager, Israel. “I look forward to further drive growth and innovation across the organization and deliver more value to our clients and partners.”

Departing GM, Meir Gefen added, "I am incredibly proud of everything we've accomplished at BlueSnap and retire with the knowledge that we accomplished many incredible things during my time there. I feel extremely fortunate to have played a part in growing our team in Israel. I know this team under Sharon’s leadership will continue to make a significant contribution to our product, helping our clients for many years to come."

Fenergo, the leading provider of digital solutions for Know Your Customer (KYC), Transaction Monitoring and Client Lifecycle Management (CLM), has appointed Andrew Brandman as Chief Customer Officer (CCO).

Based in New York, Andrew will drive global growth by continuing to deliver successful outcomes for Fenergo’s growing and diverse client base. Andrew will oversee all post-sale functions from client onboarding to software implementation, adoption, and customer success while executing on Fenergo’s client-centric strategy.  

Andrew brings over 30 years of experience in the financial services and technology sectors with a background in leading global change management projects within senior decision-making roles. Andrew joins Fenergo from Salesforce, where he served as Chief Customer Officer of Financial Services, focusing on customer adoption and success. Before that, he held C-suite roles at CIT and NYSE Euronext where he played a critical role in shaping the infrastructure for retail, commercial, and wholesale banking operations, customer onboarding, HR, marketing, and communications, among other areas. Before that, Andrew held management positions at UBS, Santander, and Credit Suisse.

Marc Murphy, CEO, Fenergo, said: “We’re delighted to welcome Andrew onboard as Chief Customer Officer. His appointment will allow us to continue to place our client success at the heart of everything we do. With Andrew’s deep domain knowledge and experience, he is perfectly placed to build deeper relationships with our clients, to help them achieve their goals with Fenergo and, in turn, help our business to continue to expand.” 

Andrew Brandman, Chief Customer Officer, Fenergo, commented: “I’m excited to join a leading innovator like Fenergo at a time of expansion. Our clients face challenges on many fronts. They need to continue providing excellent customer service, achieve revenue growth targets while navigating the fast-changing and complex regulatory landscape around KYC, Bank Secrecy Act (BSA) and AML. I’ll work closely with our customers to understand their evolving needs and ensure they have the products and expert technical support they require from Fenergo to achieve their CLM and compliance goals. I look forward to working with our customers so we can all stop financial crime around the world.”

Andrew will report directly to Fenergo CEO Marc Murphy.

Adam Seale is joining as non-executive chair of Chip, one of the fastest-growing wealth management businesses in the UK.

He brings considerable experience to Chip at a time of significant growth, with the business growing assets under management by ten times in the last year, increasing from just under £300 million at the start of 2023, to over £3 billion today. Chip's revenue also increased 922% over last year and had its first profitable quarter in Q3 2023.

Adam is leaving financial adviser firm Schroders Personal Wealth, where he was an independent non-executive director since its founding in 2019, to take up the chair role at Chip.

Previously, Adam was CEO of Interactive Investor for five years when it grew from £1 billion to £19 billion in client assets under administration, including through the acquisition of TD Direct Investing.

Simon Rabin, founder and CEO of Chip, said: "Adam brings serious experience to Chip of running mature financial services companies with billions of pounds on their books. I am delighted to see him take an active role at Chip at an exciting time in our journey and help us take the business to the next level.

Adam Seale, chairman at Chip, said: "I have been very impressed with Chip's growth, its customer-friendly technology, and its potential to continue to disrupt the market. I am looking forward to helping Simon and his management team achieve their vision to be the wealth app for a generation, giving one easy place to build savings and investments." 

Adam is also chair of Antler UK the early-stage investor, and chair of Timeline, which provides IFAs with planning technology and the UK's fastest-growing model portfolio service. It recently passed £4 billion in assets under management.

bluesheets, a Singapore-based AI automation software company, has raised US$6.5M in a Series A funding round. As reported in Forbes, the investment, led by Illuminate Financial will be instrumental in advancing bluesheets' proprietary AI capabilities, propelling them to help more clients digitize and automate their processes to stay competitive in the era of AI. The round also saw the return of key investors from previous cycles including Insignia Ventures Partners, Antler Elevate, and 1982 Ventures.

bluesheets uses millions of financial data points to train AI models for process automation across industries. The Series A funding will enable the company to enhance its AI capabilities further, accelerating growth in key markets such as APAC and the US. The company will capitalize on this investment by further penetrating target industries including financial services, insurance, supply chain and procurement, manufacturing, and more, while reinforcing its commitment to serving existing industries in accounting, finance, and hospitality.

The infusion of fresh capital will also support strategic hires at the management level, bringing in talent from established tech companies. These key additions will drive bluesheets' expansion into enterprise clients within target industries and geographies.
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The company recognizes the challenges that businesses still face today with the processing of unstructured data in multiple formats, languages, currencies, and from both digital and physical sources. bluesheets is set to diversify its product range to cater to the growing demand for AI-based data processing, adding to the existing list of major financial institutions and 100+ SMEs that presently power their automated workflows with bluesheets. As with the adoption of most emerging technologies, businesses who embrace such AI technologies will get a headstart in seizing the intrinsic value that these advancements can bring, putting them ahead of the AI-led data transformation curve.

"bluesheets is on a mission to redefine the landscape of data processing and process automation. Our Series A funding, led by Illuminate Financial, marks a pivotal moment for us as we accelerate the development of our AI product range," said Christian Schneider, CEO and Co-founder of bluesheets. "This investment not only strengthens our position as a leader in the AI automation space but also underscores our commitment to providing innovative solutions that empower businesses across different sectors and geographies."

"This Series A funding round is a testament to the value that bluesheets has already delivered to our customers, as well as a validation of the needs of customers in the market today," said bluesheets’ COO and Co-founder Clare Leighton. "Our commitment to innovation and addressing the evolving needs of enterprise clients positions us as a strategic partner in their digital transformation journey. The funding will not only fuel our expansion into new markets but also enable us to provide more integrations to off-the-shelf tools, adding to our current selection that includes Google, Microsoft, SAP and more."

bluesheets is dedicated to staying ahead of the curve and anticipates that its ability to provide robust and analytic-ready data is fundamental to advanced workflow automation with the growth of computational power. The company remains steadfast in its mission to revolutionize data processing and process automation, offering customizable AI solutions that empower clients to overcome challenges and achieve unparalleled efficiency.

HeavyFinance, a leading climate tech investment marketplace, has successfully financed €50 million in agricultural loans across Europe. This significant sum has been allocated across the current markets where HeavyFinance operates, including Bulgaria, Latvia, Lithuania, Poland, and Portugal.

The €50 million has been distributed across almost 1,700 different projects, fostering connections between small and medium farmers and a global investor community consisting of over 10,000 registered investors worldwide including countries such as France, Germany, and Spain.

The achievement marks a major step forward in promoting sustainable practices and comes as HeavyFinance is due to generate its first nature-based carbon credits in the first half of 2024. 

Laimonas Noreika, CEO and Co-Founder of HeavyFinance, commented: “This milestone is not just a number; it represents a significant leap towards sustainable agriculture and climate action. When we started in 2020, there was scepticism about the influence of financial innovations to impact the adoption of sustainable practices in agriculture. Now, with this milestone and our imminent launch of nature-based carbon credits, HeavyFinance is demonstrating what can be achieved. We’re not just financing farms; we’re investing in a sustainable future for our planet.”

Last year, the climate tech company launched its Green Loans that provide European farmers with financing for transitioning to regenerative practices at a 0% interest rate. While also giving farmers access to additional revenue from the sale of carbon credits generated from implementing those practices. 

HeavyFinance is at the forefront of developing innovative financial solutions tailored to climate action as it remains committed to bridging the financial gap that supports the global effort to achieve net-zero emissions by 2050 and contribute to achieving the UN Sustainable Development Goals.

Paymob, the leading financial services enabler in the Middle East, North Africa, and Pakistan (MENA-P), has announced a partnership with Mastercard to accelerate digital payment acceptance across the MENA region.

The strategic omnichannel partnership will leverage Paymob’s payments infrastructure and Mastercard’s payments technology to scale the adoption of low-cost solutions among micro, small and medium-sized businesses (MSMEs) in key markets. The agreement includes the acceleration and enablement of Tap on Phone, e-commerce gateway and payment links solutions. The collaboration’s focus on low-cost solutions will fast-track mass adoption of digital acceptance among smaller businesses while addressing use cases previously not served by existing solutions.

 Access to low-cost solutions supports Mastercard’s global goal of digitizing 50 million small businesses by 2025 and advances Paymob’s commitment to enabling MSMEs to thrive in the digital economy. MSMEs are the engines of economic growth and vital contributors to the GDP in MENA. Their digital enablement drives prosperity and fuels financial inclusion as the region advances toward a cashless economy.

 Islam Shawky, Co-founder and CEO of Paymob, said, “This strategic partnership with Mastercard delivers on Paymob’s mission to fuel MSMEs via access to cutting-edge financial solutions. Our joint acceleration of low-cost digital acceptance solutions will lead to greater adoption of digital payments across the region. We are dedicated to creating an environment that ensures MENA MSMEs are empowered to compete in a cashless society.”

Gaurang Shah, EVP of Products & Engineering, EEMEA at Mastercard, said, “At Mastercard, we are committed to developing fit-for-purpose solutions that enable MSMEs to pay and get paid securely. We are delighted to enter a collaboration with Paymob that builds on our complementary strengths to empower small businesses in the region to reap the full benefits of the thriving digital economy and maximize their participation in sustainable development.”

Mastercard leverages its extensive network, state-of-the-art technology, and global partnerships to help MSMEs adapt to changing commercial environments and new spending patterns. The company serves as a trusted provider of innovative and affordable digital payment solutions tailored to the needs of small businesses, ideally positioning them to diversify and expand.

As the leading omnichannel payments infrastructure provider in Egypt, Paymob offers its merchants the most comprehensive acceptance suite in the market, positioning it as a growth partner to MSMEs. The partnership with Mastercard follows Paymob’s rapid regional expansion, powered by its Series B funding of USD $50 million in 2022. Beyond Egypt, Paymob serves merchants in KSA, UAE, Oman, and Pakistan.

R3, the enterprise distributed ledger technology (DLT) and services firm, has launched R3 Digital Markets. The new suite of end-to-end digital solutions helps firms to adopt and drive value from digital assets and digital currencies today, whilst preparing for the future of regulated markets, from initial exploration to full-scale production. To lead the rollout of the new suite, R3 has appointed financial technology leader and capital markets expert Kate Karimson as Chief Commercial Officer.

R3 Digital Markets, powered by R3’s Corda, the market-leading, regulatory compliant tokenization platform, is a new solution built to connect financial markets. It is designed to progress markets by driving the adoption of best-in-class solutions, and industry standards, enabling efficiency, cost reductions, and the safe integration of DLT into core business operations. Corda has been deployed by hundreds of institutions operating at scale in capital markets including SIX Digital Exchange (SDX), ABI Lab (Spunta Banca DLT), and Euroclear D-FMI. The launch of R3 Digital Markets will make it easier than ever for regulated businesses to prepare for the digital future while enhancing current operations using Corda. R3 Digital Markets champions interoperability, not isolation, and ensures businesses are fully equipped to manage both digital and traditional assets effectively.

The R3 Digital Markets product suite includes:

• R3 Digital Currency: offering comprehensive management of the full lifecycle of digital currencies, including CBDCs and tokenized deposits, facilitating seamless interaction across networks and core banking systems for 24/7/365 settlement
• R3 Digital Assets: enables full lifecycle management tokenization solutions and digital asset exchanges to be built quickly and robustly for the issuance, listing, trading, management and custody of existing and new assets, according to the business need
• R3 Digital Connect: enables the seamless integration of classic existing systems and all DLT networks, facilitating interoperability and integration in financial markets
• R3 Digital Lab: a cloud-based collaborative lab equipped to handle custom use cases in the path to production, providing support and education to help businesses launch DLT projects without the need for a complex infrastructure

“R3 is laser-focused on progressing capital markets infrastructure,” said R3 CEO and Founder David E. Rutter. “We’re designing long-term solutions for a seamlessly connected financial world. Corda built the foundation for this, as the only production-ready enterprise DLT solution built for regulated markets. With the launch of R3 Digital Markets, we’re further progressing Corda’s mission to unlock the true potential of digital currencies and digital assets, bringing unparalleled value to economies as they digitize.”

Leading the roll-out of R3 Digital Markets is Kate Karimson, a senior executive with extensive experience across financial services and DLT. She joins R3 with a proven track record of building innovative, industry-leading businesses and products for financial markets. Karimson joins R3 following leadership roles at CME Group, BrokerTec, ICAP and LedgerEdge. 

“I’m excited to join the exceptional leadership team at R3,” said Karimson. “R3 has been at the forefront of digitising and shaping financial markets for almost a decade. Building DLT products and solutions is a complex challenge, and R3 Digital Markets is all about bringing together the experience of R3 and the foundations of Corda to modernise infrastructures and lay the groundwork for regulated networks that are not built in silos. R3 Digital Markets builds on the success of Corda by further removing barriers to entry for firms looking to build innovative DLT solutions, so they can prepare for the future of digital finance.”

Leading account-to-account (A2A) payment infrastructure provider, Token.io, has announced it has become an official participant in the SEPA Payment Account Access (SPAA) scheme: a commercial API initiative that will enable greater innovation and unlock wider adoption of A2A payments in Europe. 

Through leveraging Open Banking and instant payments, the SPAA scheme will directly support the establishment of a competitive pan-European payment solution, which is a key pillar of the retail payment strategies of both the European Commission (EC) and European Central Bank (ECB). 

As a SPAA participant, Token.io will contribute to the development of the richer payment functionality outlined in the scheme’s rulebook and Minimum Viable Product for banks and TPPs. Examples include Dynamic Recurring Payments (analogous to the UK’s Variable Recurring Payments capabilities) and Payment Certainty Mechanisms, which will expand the use cases for instant bank payments to include one-click checkout and point of sale payments. These new payment capabilities will deliver benefits to payment service users throughout the EU, while creating robust competition with established payment methods, enabling banks to create new revenue opportunities, and positioning Europe as a global leader in digital payments. 

“We have been actively engaging with SPAA since its very early days, and are proud to be one of its first official participants,” said Charles Damen, Chief Product Officer at Token.io. 

“SPAA has already established a clear business model for all scheme participants that is both attractive to banks (enabling them to complement and monetise their investments in PSD2) and persuasive for merchants (with fees for key payments functionality lower than cards),” added Damen. “As a result, we have already seen strong interest from payment providers and merchants in leveraging SPAA functionality, particularly Dynamic Recurring Payments (DRPs). In fact, Token.io’s recent research shows 83% of banks believe they will drive commercial upside from DRPs, and the majority of merchants would seek to convert card payments to DRPs. DRPs have real potential to become the ultimate frictionless, cost-effective payment option for Europe, and we look forward to working with all participants to establish their first trials.”

This announcement marks another significant milestone for Token.io — recently recognized as the ‘Best Open Banking System’ at the 2023 Banking Tech Awards — complementing the company’s track record of innovation, which includes launching the first online payments service to combine SEPA Instant and PSD2 APIs (BNP Paribas’ Instanea).

The SPAA scheme was developed collaboratively by the European Payments Council (EPC), the retail payment industry (as represented by the Euro Retail Payments Board), and is supported by relevant EU institutions, including the European Central Bank and the European Commission. Token.io will be officially listed as a scheme participant in the EPC register as of 9th February 2024. 

Klarna, the AI-powered global payments network and shopping assistant, today announced its entry into the subscription service model with the launch of Klarna Plus, issued by WebBank, now available to eligible US consumers through the Klarna app for a monthly fee of $7.99.  Klarna Plus allows members to maximize their Klarna experience through access to a variety of features and offers, including waived service fees on Klarna’s One Time Card product, double rewards points, and access to special deals with popular brands.

“Today marks an exciting milestone for Klarna with the introduction of our first-ever premium subscription service, Klarna Plus,” said David Sandstrom, Chief Marketing Officer, Klarna. “Our research indicates that dedicated Klarna users are looking for an enhanced shopping experience through a subscription model. Klarna Plus addresses this demand, allowing us to deepen our engagement with 37 million loyal US consumers, while also further diversifying a portfolio of payment and shopping solutions.”

The global subscription e-commerce market is thriving, projected to reach a valuation of US$2419.69 billion by 2028, fueled by evolving consumer shopping preferences including the continued proliferation of online retail and mobile shopping. Klarna Plus delivers a suite of premium benefits for a nominal fee. Available within the Klarna app, this new service builds on the innovative suite of best-in-class payments and shopping services, offering a subscription model that brings even more value to loyal Klarna shoppers by giving members access to a variety of exclusive offers and deals. 

Klarna Plus offers the following features at launch, with more coming soon:

• Double rewards point – Collect double points (2 points for every $1 spent) on purchases with Klarna rewards club.
• No service fees – Shop at any retailer outside Klarna's network to split payments into four interest-free installments using Klarna’s One Time Card, with no added service fees. This exclusive benefit can save loyal Klarna consumers ~$12 each month.
• Exclusive deals – Access special discounts at Nike, COACH, Macy’s, Instacart, and GOAT, totaling up to $30/month.

In addition, consumers who sign up for Klarna Plus can take advantage of a welcome offer, saving $8 on their first Klarna Plus purchase.

Klarna Plus’s debut comes during a period of substantial and continued growth for Klarna in the US market, as the company continues to evolve beyond Buy Now, and Pay Later into a 360-degree shopping and payments ecosystem. Over the past year, Klarna's US customer base has expanded by an impressive 32%, now reaching 37 million consumers. This growth is attributed to Klarna’s ongoing market innovation, with Klarna Plus being the latest addition to an expanding suite of US payments and shopping services, which today includes flexible payment options allowing consumers to pay now, pay later, or over time; as well as a comprehensive suite of shopping solutions including the AI-powered Klarna App, which now boasts over 7 million monthly users in the US.