TFU | Oct. 16-22

Leading Off

The CFPB outlined non-binding principles governing consumer data-sharing and third-party access; J.P. Morgan Chase announced it will acquire payments startup WePay; IBM and J.P. Morgan are both working on new blockchain-based, cross-border payments solutions; P2P payments service Venmo is now available as an online payments option; the U.K. FCA published a report on “lessons learned” from the first year of its regulatory sandbox; and blockchain startup DAH raised $40M in new funding.

In the News

CFPB outlines consumer data access principles.  The U.S. Consumer Financial Protection Bureau (CFPB) released non-binding principles [full text] related to the sharing of consumer data with authorized third-parties (e.g., via a bank API). Such data-sharing underpins many fintech products and services, but has received pushback from banks and can pose data security risks.

Treasury will review fintech risks and opportunities.  The U.S. Treasury Department announced it will release a report in early 2018 on America’s financial regulatory structure, including a review of fintech risks and opportunities. A Treasury spokesman said the department will collaborate with other regulators in creating the report.

J.P. Morgan Chase purchases WePay.  The global bank plans to acquire the payments firm and “roll out WePay’s technology to [the bank’s] four million small-business customers.” No terms were disclosed, but the purchase price is said to be higher than WePay’s 2015 $220 million valuation. The WSJ notes that this is J.P. Morgan’s “first sizable acquisition of a [fintech] startup.”

You can now pay online with Venmo.  Parent company PayPal announced that its popular P2P payments service will now be “available at over 2 million online U.S retailers, allowing Venmo users to shop on the mobile web at almost everywhere PayPal is accepted.” “Offering a way to pay at millions of retailers is a major step in [Venmo’s] evolution,” said Bill Ready, PayPal’s COO.

Paypal’s market cap climbs to $83B.  The mobile payment company’s shares are up nearly 75% since the start of 2017, nearly doubling the firm’s $47 billion market capitalization when it split from eBay two years ago. PayPal is now larger than industry heavyweights like American Express, and is gaining ground on Wall Street leaders Goldman Sachs and Morgan Stanley.

FCA publishes regulatory sandbox “lessons learned.”  The U.K.’s Financial Conduct Authority (FCA) published a report [full text] detailing the first year of its regulatory “sandbox” initiative. The FCA notes that most of the 50 fintech firms accepted into its two cohorts “have tested products in the sandbox [and] have gone on to take their innovation to market.”

Spanish firms launch blockchain consortium.  Some of Spain’s leading finance, energy, and telecom firms joined together to work on a blockchain platform that could “become the system of record for data exchange among these large corporations.” Among the goals of the Alastria program is a national, online, digital identity for all Spanish citizens.

Digital Asset Holdings raises $40M.  The blockchain startup founded by former JPMorgan executive Blythe Masters has raised Series B funding led by Jefferson River Capital, which may be used to fuel acquisitions, Finextra reports. DAH’s clients include global derivative clearinghouses like the DTCC and SIX Securities Exchange as well as public exchanges.

Feedzai raises $50M Series C.  The Finnish-U.S. machine learning startup raised $50 million to help grow its suite of payment fraud-detection tools for banks and merchants. Feedzai currently counts 60 companies, including major financial institutions like Capital One and Citi, among its clients.

New CFPB data-sharing principles gain early, broad support.  The American Banker’s Penny Crosman writes that early feedback on the CFPB’s new statement of principles regarding third-party data-sharing has been largely positive from both fintech firms and banks.

 

 

 

 

 

 

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