Railsbank news round-up: Cledara closes pre-seed round
A brief look back at week 39
Cledara closes pre-seed round
The week started with news that Cledara, a groundbreaking purchase and analytics platform for the subscription economy, closed its pre-seed round which was led by Anthemis, along with Spanish bank BBVA, and joined by 2018 UKBAA Angel Investor of the Year Chris Adelsbach.
The round takes the total raised by the company to $930,000. Interestingly, this funding round made Cledara the first participant of the current Techstars London cohort to have raised and was the first ever investment made by the Anthemis and BBVA Partnership.
Cristina Vila, Founder and CEO of Cledara, said: “We are delighted to welcome Anthemis, BBVA and Chris to Cledara. Anthemis has been a fintech pioneer from the very beginning, and their experience, combined with BBVA’s expertise, resources and reach will massively accelerate Cledara’s growth.”
Fintechs more than double personal loan market-share
We also learnt that fintechs have more than doubled personal loan market-share in four years. A report from Experian, entitled Fintech Marketplace Trends Report, highlighted that competition in personal lending between traditional financial institutions and fintechs is increasing.
Fintechs more than doubled their market share in four years to 49.4%, up from 22.4% in 2015. The data also showed that the unsecured personal loan category had grown significantly in the past four years as new loan originations were 1.3 million in March 2019 compared to 656,000 in March 2015.
The report also revealed that the average fintech loan was $5,548 while traditional lenders' average loan was $7,383. This, said the report, is a stark difference from the 2016 peak when fintech lenders' average loan was closer to $12,000. While the average fintech loan has steadily decreased over time, consumers are increasingly turning to fintech lenders for unsecured personal loans.
"We use analysis like our Fintech Marketplace Trends Report to provide insights that help lenders make more informed decisions," said Michele Raneri, vice president of Analytics and Business Development at Experian. "We know unsecured personal loans represent the largest product offering in the fintech industry and our report reveals continued growth in this area over the last four years. We believe significant changes in the financial profile of fintech borrowers and an increase in adoption from younger consumers is fueling this growth."
Finscend demonstrates AI-powered Bank Dispute Platform
In New York at FinovateFall 2019, fintech start-up Finscend demonstrated how its AI-powered Bank Dispute Platform can process a credit card dispute, which traditionally takes up to 45 days, in just seven minutes. Finscend's said banks can use its platform to reduce their dispute resolution expenses by eighty percent.
"McKinsey estimates that the top 15 U.S. banks spend approximately $3 billion each year, combined, on dispute processing," Aaron Lazor, Finscend co-founder and CEO told participants. "Very simply, banks are being bled dry with these unnecessary expenses," he continued. "And this problem will only get worse because the number of credit card disputes is growing year-to-year."
Winner of Deloitte Financial Services Innovation Award
Dublin based Fenergo, a leading provider of digital Client Lifecycle Management solutions for financial institutions, has jointly won the RegTech category at the Deloitte Financial Services Innovation Awards.
Conor Coughlan, Chief Marketing Officer, Fenergo, said: "Ireland has become a melting pot for regulatory technology innovation and this award reinforces Fenergo's position as the market leader. Fenergo is committed to creating innovative solutions that enable financial institutions to streamline Know Your Customer (KYC) and Anti-money Laundering (AML) compliance processes while creating frictionless, digital client experiences."
Wave of new opportunities and revenue streams in the rapidly changing HK banking landscape
And finally over in Hong Kong, the Annual Banking Conference took place. Hosted by The Hong Kong Institute of Bankers (HKIB), over 800 delegates heard a range of viewpoints from over 50 senior government and regulatory officials, leading bankers and fintech experts on how digitalisation, disruptive business models and the Greater Bay Area will unlock a wave of new opportunities and revenue streams in the rapidly changing banking landscape.
The conference heard that virtual banking is set to become a fundamental part of the Hong Kong banking industry and a number of representatives of virtual banks were invited to share their insights in a panel discussion. It was clear that these institutions are now advocating for an innovative banking experience to benefit customers, but they noted that recruiting talent with both a technology and business mindset is a significant challenge for them.