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Industry roundup: 9 February

HSBC launches virtual debit cards for UAE businesses

HSBC has launched virtual debit cards for businesses in the UAE. The cards, which operate on the Visa platform, generate single-use card numbers, or ‘tokens’, for each transaction, with the payment debited directly from the corporate cardholder’s current account. Using Visa’s Payables Automation platform, a card is distributed electronically, protecting the primary card number and providing enhanced payment security and efficiency.

“The pace of digital adoption by businesses in the UAE has accelerated over the past 12 months, with an increased demand for more flexible payment channels," commented Kailash Nair, HSBC's regional head of Commercial Cards, Middle East North Africa and Turkey. "HSBC is investing to create a bank fit for the future and for us that means availing multiple digital options to suit the different needs of our diverse corporate client base. Launching Virtual Debit Cards is a prime example of the bank’s digital upgrades in action, by which we are able to bring to our clients more choice in making B2B payments.”

HSBC’s recent Navigator 2020 survey of more than 10,0000 companies around the world showed that digital is key to businesses succeeding as the world recovers from the COVID-19 pandemic, with ‘high growth’ companies now making most sales online. Some 32% of high growth firms expect technology-driven efficiencies to be a key driver for their recovery, more so than businesses with lower or no growth. As a result, 87% plan to invest in digital tools and platforms next year, while a third have already innovated new products and services.

Virtual Debit Cards complement the existing HSBC Commercial Cards suite, which includes Virtual Credit Cards, giving customers a variety of business-to-business payment options.

 

Mastercard and Seeburger to partner on request to pay solutions

Mastercard has announced it has signed an agreement with global business integration technology firm Seeburger, to provide businesses and people across Europe more choice, flexibility and control across a range of next generation real-time request to pay solutions, with an initial focus on bill payments.

The parties will bring together Mastercard's request to pay-based technology with Seeburger’s Business Integration Suite, enabling businesses to transform their billing and collection process for end customers. The agreement includes a six-month pilot project to test and ready the solution for the market, initially across Europe.

With bill payments the initial focus, the collective aim will be to create significant value by: digitising the billing presentment process; digitising customer communications; presenting consumer offers; and enabling accelerated cash flows through better visibility of payment statuses. The working partnership will also look to enhance auto reconciliation, and drive efficiencies for billers by offering a digital platform for communicating directly with their customers to manage enquiries or disputes. Enhanced Bill Payment services also offer financial institutions increased mobile application engagement by their customers and additional revenue opportunities.

 

Deutsche Bank most prominent as arranger of sovereign, supranational and agency debt

Deutsche Bank has said it has climbed to the top of the league table for Sovereign, Supranational and Agency (SSA) debt issuance in what has been the busiest month for the market ever. The bank has been mandated as lead arranger on US$82bn of debt issuance for SSA clients so far this year, underwriting US18.9bn, up nearly fourfold year on year. It has climbed up from seventh position at the end of 2020 and from eleventh position year-on-year, according to Bond Radar.

January is historically a busy month for SSA issuers as they typically frontload their annual issuance. The market is particularly buoyant this year as issuers looks to raise capital to fund furlough schemes and other Covid rescue plans. Investor demand has been fuelled by excessive cash balances that need to be put to work, resulting in all deals being multiple times oversubscribed. The secondary performance has also been very robust due to the vast order books that have been placed.

Deutsche Bank has been a lead manager of many of the largest transactions so far this year, including a 14 billion euro dual tranche social bond from the EU. This was the fourth instalment of financial support to EU member states under the SURE (Support to mitigate Unemployment Risk in an Emergency) programme. The issue consisted of two social bonds: a €10bn 7-year bond and a €4bn euro tap, due in November 2050, making it the largest 30-year bond outstanding from a supranational. The proceeds from this and the other three issuances under the SURE programme will be disbursed to EU member states in the form of loans to help them cover the costs of short-time work schemes, protecting millions of people from unemployment .

The Republic of France issued a €7bn 50-year offering, with Deutsche Bank as joint lead manager. The transaction attracted over €75bn in demand from investors at final terms. This was the sovereign’s first 50-year benchmark since 2016. Another stand-out sovereign issuance was the £6.5bn bond from the UK. Anchored by its core domestic investor base, the deal was highly successful and was 8.7 times oversubscribed, allowing the UK to price at the tighter end of the guidance.

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