September 1, 2023 FinTech Monitor

BFC FinTech Monitor (August 2023)

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Stay up-to-date on all the latest FinTech news and information from around the world in the BFC FinTech Monitor.

Around the World

#Reports and Studies

  • According to the KPMG Pulse of Fintech H1 2023 Report, funding for fintechs fell to USD 52.4 billion in the first half of 2023 due to a “cloud of uncertainty” hanging over investors.
  • A recent Morgan Stanley analytical report declares that artificial intelligence and related technologies will transform all industries and become one of the most important investment topics within the next 10 years.
  • Juniper Research is predicting that banking-as-a-service (BaaS) platform market revenue will grow by 1125% to reach USD 49 billion by 2028.

#Payments

  • The Bank for International Settlements (BIS) is establishing a task force to enhance the interoperability and efficiency of cross-border payments.
  • Apple is expanding Apple Pay’s tap-to-pay functionality by allowing users to accept contactless card payments with the simple press of a button on their iPhone. Currently, this option is available to users in the Netherlands.
  • Regulators in Cambodia and Laos have launched the first phase of a project allowing users to make cross-border payments using QR codes. The central banks of Singapore and Indonesia are planning to implement a similar project in the near future.

#Artificial Intelligence (AI)

  • Meta has introduced SeamlessM4T, a new AI translation model that supports nearly 100 languages.
  • Alibaba Cloud has introduced 2 AI models capable of understanding audiovisual content.
  • Google is developing an AI assistant capable of giving advice on education, nutrition, exercise and financial planning.
  • The Reserve Bank of India is planning to develop solutions that will allow users to confirm payments as well as issue loans using AI.

#Cryptocurrencies, Blockchain, Non-Fungible Tokens (NFTs) and Decentralized Finance (DeFi)

  • A joint report by Ripple and the Fast Payments Council has found that blockchain could save financial institutions about USD 10 billion in cross-border payments.
  • Visa and Mastercard are ending their collaboration with Binance, under which the companies issued crypto cards. Binance has also closed its Binance Connect (formerly Bifinity) buying and selling service and announced that it has stopped servicing for its debit cards in a number of countries in Latin America and the Middle East.
  • July was the worst month for the crypto market. According to De.Fi, losses in July amounted to USD 486 million, six times higher than in July 2022.
  • Cryptocurrency exchange Coinbase is creating a human rights organization called Stand with Crypto Alliance, which will work to promote reasonable regulation of the crypto market in the US.
  • PayPal has introduced a new Crypto Hub feature that allows users to store and directly trade cryptocurrencies.
  • Crypto exchange Huobi plans on integrating PayPal‘s stablecoin, PYUSD into its options.
  • Crypto exchange Binance has opened a branch in Japan 2 years after receiving a warning from the Financial Services Agency (FSA) about operating without an appropriate license.
  • TRM Labs has found that North Korean hackers have stolen nearly USD 2 billion worth of cryptocurrencies over the last five years.
  • The cryptogambling.tv platform has named Slovenia the “most crypto-obsessed” state in Europe.
  • Owners of crypto assets are at risk due to a critical vulnerability in the WinRAR archiver.
  • The developers of the Telegram bot Wallet have demonstrated a beta version of their non-custodial wallet TON Space.
  • Cloud storage service Dropbox has disabled its unlimited plan due to cryptocurrency miners.

#Central Bank Digital Currencies (CBDCs)

  • According to a CFA Institute study, only 42%finance professionals support the launching of a CBDC.
  • Mastercard has launched an affiliate program for central banks on CBDCs to study how CBDCs interact with other payment mechanisms as well as what problems CBDCs can solve.
  • The deputy chairman of the Bank of Spain is calling on the European Central Bank (ECB) to study the potential impact of launching the digital euro on financial institutions.
  • The Bank of Canda believes that the introduction of a CBDC is unlikely to make a big difference to Canadians as 98% of Canada’s adult population already has a bank account.
  • Blockchain startup Soramitsu is exploring new opportunities for using CBDCs in a project to create a cross-border payment system for Asian countries.
  • ECB is preparing to test settlements with DLT transactions using a wholesale CBDC.

#Miscellaneous

  • TikTok intends to obtain a payment license in Indonesia.
  • Standard Chartered is partnering with Ant Group to promote global sustainability.
  • Visa is expanding its partnership with digital payment provider Conferma Pay to develop the Visa Commercial Pay system, a package of B2B payment solutions for businesses.
  • Swift has reported significant progress towards its G20 targets, with 89% of transactions reaching recipient banks within an hour.
  • The British Competition and Markets Authority has recognized Monzo as the best bank in the country for servicing personal and business accounts.
  • The National Assembly of the Central African Republic has adopted a law on the tokenization of land and natural resources, allowing citizens and foreigners to quickly open companies and obtain licenses related to the exploitation of natural resources and forestry.
  • Alipay has launched an international version of its app for travelers to China.

Ukraine

  • The National Bank of Ukraine has approved a concept of open banking that is expected to be implemented by August 2025.
  • Ukraine’s parliament has passed 2 bills making virtual assets and digital content objects of civil law, making them subject to the Civil Code of Ukraine.
  • The fintech conference POWER PAYMENT MEETUP will be held in Kyiv on September 12, 2023.
  • Ukraine has once again been named a top-ten country in terms of the number of NFC payments made using Mastercard digital cards, with 6 out of every 10 transactions are made using NFC devices.
  • Verified users of the WhiteBIT crypto exchange will be able to exchange USDC stablecoin for hryvnias, dollars and euros at MoneyGram branches in Ukraine.
  • The Deputy Minister of Digital Transformation has stated that the requirements of the European cryptocurrency legislation MiCA are too stringent for the Ukrainian blockchain industry and may limit competition in the market.
  • Ukrainian crypto platform CoinPay has announced its closure.
  • Visa and Privatbank have presented the Digital Authentication Framework for the digital authentication of payments in e-commerce.
  • Revolut cards are now only available to Ukrainian refugees who can prove their right to reside in the European Union (EU).
  • PaySpace Magazine has published an article about the largest grant programs in the fields of Web3 and cryptocurrency.

Kazakhstan

  • The National Bank of Kazakhstan is preparing to launch a pilot digital tenge platform in collaboration with commercial banks. The regulator has already presented the CBDC to the Supreme Audit Chamber.
  • SME Banking Agency has ranked 3 mobile banks from Kazakhstan among the best in the Caucasus, Central Asia and Eastern Europe.
  • Kazakh company S1lkPay has received a US patent for an “innovative method and system for distributed payment processing using a centralized payment processing platform”.
  • The volume of non-cash transactions in the first half of 2023 has increased to KZT 63.1 trillion, up from KZT 43.9 trillion a year ago.
  • The Agency for Regulation and Development of the Financial Market is planning to create an anti-fraud center as well as strengthen security requirements for mobile banking apps.
  • Bank CenterCredit has launched an online mortgage service.

Kyrgyzstan

  • President Sadyr Japarov has approved the construction of a mining farm at Kambar-Ata HPP. A total of USD 20 million will be invested for the project.
  • Registration for the Startup Nation hackathon is open until September 14, 2023. The event will be held in Bishkek September 16–17, 2023.
  • The Financial Supervision Authority has issued licenses to Crypto Ford and M-Trade for activities related to the exchange of virtual assets.
  • Kyrgyz miners have replenished the country’s budget with more than KGS 33 million in 6 months.

Tajikistan

  • Tajik banks are negotiating with Russian partners to connect to the Fast Payment System.
  • The share of non-cash payments doubled in the first half of 2023.

Uzbekistan

  • The Fintechno telegram channel has published a map of the fintech market in Uzbekistan. The map is based on the 50 most popular financial apps in the country.
  • The Upper House of Parliament has approved a law regulating crypto assets, with mining pools, crypto-exchanges, crypto-depositories, crypto-shops and mining operations designated as new types and sub-types of licensed activities that require licensing.
  • The National Agency for Perspective Projects of Uzbekistan has issued a license for C-BASE to operate a crypto shop.
  • Kapitalbank, Mastercard and UzNEX crypto-exchange have launched the first cryptocurrency card in Uzbekistan.
  • The conference Uzbekistan IT Days, which is dedicated to the IT sector of Uzbekistan, will be held in Amsterdam on September 27, 2023.
  • The Uzcard app is now called Plum and offers users virtual cards.

Azerbaijan

  • Neobank Leobank has attracted 1 million customers in Azerbaijan.

Georgia

Moldova

  • The head of the National Bank of Moldova’s financial technologies department has stated that Moldova plans to switch to open banking next year.
  • The DeepTech GigaHack hackathon, which focuses on energytech, fintech, healthtech, biotech, AI and big data, will be held in Chisinau September 9–10, 2023.

Prepared by BFC