Let’s end this week on a high note, looking at the most interesting fintech headlines. First of all, we discuss the newest developments in India and China that appear to be moving forward with crypto and crypto mining bans. We also discuss the testing of Digital Yuan in Hong Kong, State Street trying to find a place in a crypto arena, a new Visa solution that will make GoldenSaachs customers happy, London’s Fly Now Pay Later spin on the BNPL used for online shopping, and Unobank receiving the digital banking license.
One Of India’s Main Crypto Exchanges Under Investigation
On Friday, India’s financial crime-fighting agency announced that one of the main crypto exchanges in the country was under investigation. The company in question, WazirX, and its directors are suspected of violating the foreign exchange regulations. The investigation news comes amidst the potential ban on cryptocurrencies in India.
WazirX has been owned by the largest digital currency exchange Binance since 2019 and the investigation into the company started in connection to the money laundering case. It was found that proceeds of crime worth roughly 570 million rupees could have been converted into cryptocurrencies through the Binance platform.
“WazirX does not collect the requisite documents in clear violation of the basic mandatory Anti Money Laundering (AML) and Combating of Financing of Terrorism (CFT) precaution norms and FEMA guidelines,” the agency said.
WaziX has announced it did not receive any notice from the agencies yet, but claimed they are adherent to all laws.
“We go beyond our legal obligations by following Know Your Customer (KYC) and AML processes and have always provided information to law enforcement authorities whenever required,” Nischal Shetty, CEO, and Founder, WazirX said.
“We are able to trace all users on our platform with official identity information. Should we receive a formal communication or notice from the ED, we’ll fully cooperate in the investigation,” Shetty countered.
More Chinese Provinces Ban Crypto Mining
After Bejing called to crack down on the crypto industry, several new provinces in China have decided to ban crypto mining projects. This week, the northwestern province of Qinghai and the neighboring Xinjiang ordered cryptocurrency mining projects to close this week.
Currently, China is behind roughly half of the global bitcoin production.
“We are standing at an inflection point for the mining industry here in Asia,” said Lei Tong, Managing Director Financial Services at Babel Finance, a Hong Kong-based crypto lender and asset manager.
“Many miners now are seriously re-evaluating their future operational plans as the current regulatory environment is unfavorable for their growth and the scaling of their business.”
According to the new regulations, miners that will set up new projects will be punished.
“Scouting for new destinations is truly happening on a global scale with North America and Europe among the most sought-after places, followed by countries in Central Asia and the Middle East,” said Tong of Babel Finance.
Hong Kong Will Try To Link Digital Yuan With Domestic Payments Network
On Tuesday, the officials from Hong Kong revealed that they would test linking China’s digital yuan with their own, domestic payment network. It is the second stage of trials of China’s digital currency. This particular trial will explore how the Hong Kong population can top up the digital wallet with yuans while using the domestic payment system.
“This will help Hong Kong residents to use e-CNY when they cross the border,” Nelson Chow, chief fintech officer of the Hong Kong Monetary Authority (HKMA), told a media briefing on Tuesday.
“People are now a lot more used to digital payments, and if other central banks are exploring possible use cases for CBDCs… you have to try out to see whether you can make it successful,” Eddie Yue, HKMA’s chief executive, said at the same briefing.
State Street Enters The Crypto Space With Their Newest Digital Solution
State Street announced it will shift to the decentralized finance sphere as they created a brand new division whose sole goal is to engage with digital assets such as cryptocurrencies.
“The financial industry is transforming to a digital economy, and we see digital assets as one of the most significant forces impacting our industry over the next five years,” says Ron O’Hanley, chairman and chief executive officer of State Street Corporation. “Digital assets are quickly becoming integrated into the existing framework of financial services, and it is critical we have the tools in place to provide our clients with solutions for both their traditional investment needs as well as their increased digital needs.”
The newest division will base on the digital capabilities that State Street currently holds and expand to include CBDCs, Blockchains, and crypto. The bank also plans to develop their GlobalLink platform so it can support crypto assets among many other emerging digital assets. Nadine Chakare, a veteran and executive vice president has been chosen to lead the business.
“We have been developing a number of digital capabilities and other solutions as well as partnering and investing in the infrastructure that forms the foundation of State Street Digital,” said Chakar. “State Street has a major role to play in the evolution of digital market infrastructure and this new division will help us bring our expertise and resources to the conversation. As digital currencies and tokenization not only gain momentum, but transform financial infrastructure and operating models, we can help our clients bridge the gap between the industry of today and the one of tomorrow.”
Visa Payment Solution Can Transform Operations Of Goldman Sachs Clients
Visa has just announced its newest strategic partnership with Goldman Sachs. Through cooperation, the companies aim at helping businesses move money around the world. Goldman Sachs will leverage the strengths of Visa B2B Connect and Visa Direct Payouts solutions and is going to simplify the processes and costs for their corporate clients.
Alan Koenigsberg, Global Head of New Payment Flows, Visa Business Solutions said, “There is an immediate need for modernization of global money movement to help businesses around the world simplify and enhance how they pay and get paid across borders,” comments Alan Koenigsberg, Global Head of New Payment Flows at Visa Business Solutions. “Visa’s partnership with Goldman Sachs Transaction Banking is an important milestone in our efforts to break down traditional processes and silos and help spur innovation in this critical industry segment for the decades to come.”
“We believe paying someone halfway around the world should be just as easy as paying someone around the corner,” comments Eduardo Vergara, Global Head of Transaction Banking Product and Sales at Goldman Sachs. “We are proud to partner with Visa to introduce fast and easy ways our clients can make payments across the globe.”
Unobank Is The First Filipino FinTech Receiving A Digital Banking License
This week has been very big for the filipino fintech company Unobank, as one of the primary incorporators has received the approval from the Bangko Sentral ng Philipinas for Unobank to operate as a digital bank in the country.
Unobank will be fully regulated under the Digital Banking License framework in the Philippines.
“As a fintech company, we are based in Singapore to tap the vibrant fintech community here for the latest in innovation and technological development,” comments Puneet Gupta, Co-founder & CTO. “We are in the midst of building a robust, highly secure digital banking platform for UNObank. We are ensuring that the technology we use has the flexibility to create unique customized solutions that will enhance the user experience and add immense value to those Filipino communities that are currently unserved and underserved.”
The aim behind UNObank was to bridge the financial gap in the Philippines. The company also plans to expand to other regions in the Southeast and South Asia, hoping to achieve the same there.
Manish Bhai, the CEO of UNOBank said, “The BSP’s vision and foresight to digitise the local banking industry is future-forward and apt because ultimately it will help align the Philippines as a modern banking center for the region,” comments Manish Bhai, CEO of UNOBank. “We are very grateful to the BSP and honoured by the trust placed in our team.”
“Long term, our goal is to bridge the gap to financial inclusion. With UNObank, we are building the first full-spectrum digital bank to service those with unmet financial needs in Southeast and South Asia,” he adds.
London’s BNPL Receives Additional £10 Million Investment
The BNPL fintech Fly Now Pay Later has just received £10 million in an equity investment co-led by Revenio Capital and Taurus Wealth Advisors. This adds to their already huge £35 million of equity and debt Series A financing raised last year.
The company wants to use the money to expand to the UK, US, and Germany. The startup was founded back in 2015 by Jasper Dykes and it provides the customer with a chance to spread the cost of their trip over up to a year.
The payment technology has been undergoing the tests within the US since the end of 2020. So far the startup has established partnerships with Kayak, Malaysia Airlines, and Universal Air Travel Plan which is an airlines payments network.
“After more than a year of being in our homes, people are itching to dust off their suitcases globally,” comments Dykes. “The recovery of travel is likely to be gradual, but when it happens, we hope that by giving people the freedom to book a trip and pay at a pace that works for them, will help spur reservations.”
Related:
Financial Institutions Try To Keep Up With FinTech, BNPL Services Are On The Rise – FinTech Weekly
HSBC Tries To Compete With FinTechs, BNPL Growth, And Digital Dollar – FinTech Weekly
Cryptocurrency Regulations, NFT Demand, And Apple Antitrust Case – Tech Weekly
