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Industry roundup: 13 December

Ongoing transformation with cryptocurrencies: Visa launches Global Crypto Advisory Services

Digital currencies and crypto products, although still in early stages, continue their popularity and growth among businesses and financial institutions. Ninety-four percent of the world is familiar with cryptocurrencies in some way, according to a Visa Research Survey. In addition, the research further added that nearly one in three crypto-aware consumers already own or use cryptocurrency.

With the increase in crypto, Visa progresses to serve and enhance its products to commerce worldwide. Visa launched Global Crypto Advisory Practice, a Visa Consulting & Analytics (VCA) service, designed to help customers and partners advance their unique crypto journey.

Understanding the crypto ecosystem is especially important for financial institutions seeking to entice and retain customers by offering cryptocurrencies, retailers seeking to explore nonfungible tokens (NFTs), or central banks looking to explore digital currencies. A global network of Visa consultants and product experts working with over 60 crypto platforms enables financial institutions to evaluate crypto opportunities, develop specific strategies, and test innovative products such as crypto reward programs and test wallets from CBDC integrated consumers.

Carl Rutstein, Global Head, Visa Consulting & Analytics, commented that Visa is working with customers and partners in all regions, including the United States, where Visa's team works with UMB Financial Corporation. Uma Wilson, Executive Vice President and Chief Information and Product Officer, UMB Bank, further agreed that Visa’s Consulting and Analytics group helped develop a tactical plan, from selecting product and partner to detailed functionalities on technology, finance, risk and compliance.

Visa research on consumer adoption of crypto

Research indicates an increasing awareness of customers and crypto around the world. According to the research, The Crypto Phenomenon: Consumer Attitudes & Usage, approximately one-third of those surveyed have involvement with crypto directly as an investment or medium of exchange. According to the survey, about forty percent of crypto owners surveyed internationally are expected to change their principal bank to a bank offering crypto-related products within the year.

Terry Angelos, SVP and Global Head of FinTech, Visa, stated that all financial providers will need a crypto strategy as crypto signifies a technological change in funds and digital asset movement and as consumers are changing their view of investment approaches, banking and the future of money.

Below are some findings from Visa’s survey: More than 6,000 financial administrators were included (Argentina, Australia, Brazil, Germany, Hong Kong, South Africa, the United Kingdom and the United States):

  • Crypto awareness is almost universal. Accounting for 94% of survey respondents who control household finances worldwide.
  • A key segment uses or invests in cryptocurrencies. Almost one in three adults who are crypto-conscious own or use cryptocurrencies, and the majority (62%) of this group states that usage has increased over the past year.
  • Higher crypto participation in emerging markets. While 29% in developed countries, 37% of crypto-aware consumers surveyed in emerging markets use or own crypto.
  • Critical drivers include wealth accumulation and belief in crypto as the future of financial services. The survey showed the largest motivators behind the possession and use of cryptocurrencies are participation in the "Financial Path of the Future" (42%) and wealth accumulation (41%).
  • Crypto-linked cards and crypto rewards are lucrative. Eighty-one percent of today's crypto owners are interested in crypto-linked cards that can be converted and used at retail stores in the same way they use debit or credit cards. Eighty-four percent are interested in crypto rewards that can be used to earn crypto as a reward for card spending.
  • Consumers are ready to switch banks looking for cryptocurrency products. Eighteen percent of respondents worldwide say they are likely or very likely to switch their primary bank to a bank that offers crypto-related products within the next 12 months. This is especially true for emerging markets, which jump to 24%. Almost 40% of consumers who already own cryptocurrencies want to switch.

For more details on Visa’s research study, click here to download “The Crypto Phenomenon: Consumer Attitudes & Usage”.


International B2B payments in LATAM: Tribal Credit partners with Bitso and Stellar

Fintechs continue to bring innovative solutions particularly into new emerging markets. Tribal Credit, a B2B payment and financing platform for emerging markets, has partnered with Bitso and the Stellar Development Foundation (SDF), cryptocurrency exchanges in Latin America, to provide an immediate, low-cost cross-border payment between Mexico and the United States. Tribal Credit's new service allows B2B payments in pesos from Mexican companies to be transmitted to the United States while beneficiaries would receive payments in US dollar denominations.

Mohamed Elkasstawi, Chief Strategy Officer, Tribal Credit, leads the company's blockchain efforts. Elkasstawi commented on the ease of processing time-sensitive payments from SMBs across LATAM to the United States. With 62 million SMBs trading worldwide each year, the Latin American region represents $ 175 billion in market opportunities, especially in Mexico. Tribal Credit's cross-border payment options are cost-effective and speedy through Bitso, the region's most liquid cryptocurrency exchange, enabling pesos to Stellar’s tablecoin backed by US dollars (USDC).

Carlos Cota commented that Bitso and Tribal Credit aim to provide world-class financial services to SMBs across Latin America. The combined partnership provides companies the ability to easily move funds from Mexico to US companies. This is a reflection on how cryptocurrencies can revolutionize payments in the worldwide digital economy.

The Stellar Network is a decentralized sustainable network of financial products and services supporting cross-currency transaction and the issuance of digital assets. Tribal's cross-border payments will leverage the open-source Stellar Network. Mark Heynen, VP, Business Development and Partnerships, Stellar Development Foundation, further added that the integration of Tribal’s lending capabilities, Bitso’s crypto-currency exchange platform, and Stellar USDC’s low-cost and high-speed system will help SMBs in the LATAM region obtain access to financial products and services.

Tribal uses a unique AI-powered approval process to provide a variety of financial services to help Latin American SMEs settle their expenses and optimize their financial management. Some of the financial services include multi-currency corporate VISA cards with spend controls, credit lines for on-card purchases and payroll services for employees and contractors. Utilizing blockchain technology and cryptocurrency for backend design to significantly enhance the front-end user experience is a substantial benefit for businesses, commented Arvind Nimbalker, Global Head of Product, Tribal Credit.

A corporate card and spending management test version platform for start-ups and small businesses in emerging markets was released by Tribal Credit in December 2019. Given the growing demand for a more efficient online B2B banking experience, especially early in the pandemic, Tribal Credit expanded its payment and financial products to include Tribal Pay. Tribal Pay enables customers to process purchases without a card and benefit from extended payment terms.

Tribal Credit’s serial entrepreneur, data scientist, and fintech executive founding team, a team of experts in specialized technology companies and financial institutions, together have built and scaled up start-ups in both emerging markets and the United States. To drive cross-market growth, the company has a global management team consisting of staff with experience at HSBC, Visa, Experian, Mercado Libre, American Express, Nubank, Marqeta, Didi Pay and other major start-ups and top financial institutions.


New API connections: Informer and Rabobank bring open banking solutions to the market

According to Holland FinTech, an independent fintech ecosystem, Informer, a cloud-based accounting software company, has access to newly developed API connections subsequent to a successful trial project with Rabobank, a cooperative-based bank in the Netherlands. This API solution allows banks to integrate data directly into Informer without the intervention of third parties. This connection will address some of the major shortcomings of PSD2 to meet the current PSD2 legislation for the continued evolution of open banking.

In recent years, open banking has grown rapidly, and it will continue to grow. As many companies offer financial solutions, the integration and connectivity with real-time banking information is vital for innovative solution developments.

In addition, Rabobank’s new API development provides a faster and more accurate picture of a company's financial status. With this API, business owners need to provide the Informer only one access to their financial information. However, customer approval is required every 90 days according to the PSD2 legislation.

Rabobank’s API allows entrepreneurs to query account information much more often than PSD2, which is queried only four times a day. Furthermore, entrepreneurs are able to access savings account information through Informer, a recurring drawback of the PSD2 guidelines.

The new Rabobank accounting link is not the first innovation pioneered by Informer. For example, in 2016, Informer introduced the world's first direct API using Bunq. This allowed the first real-time connection between the accounting program and the bank. In 2016, the launch of ING's new QR function enabled easier and faster payments with the ING app. In addition, Informer was the first accountancy program to have an API with the Dutch tax authorities, allowing entrepreneurs to easily file value-added tax (VAT) returns paid through iDEAL.

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