Major Fintech and Technology firms, what we know so far

Christopher Zenios24/10/20194min
In the past week, there have been ups and downs in the world of Fintech and Technology and in this article, we will give insight as to what’s happening lately.

Revolut’s $1.5bn loan

Financial technology company Revolut is looking for a $1.5bn new fund in a move that would make it Europe’s best-financed Fintech. The $1bn loan would be used for global expansion, in addition to the new equity of $500m from investors. The loan is to be converted into shares if Revolut received a US banking license which was reported recently by Sky News.

In the early stages of 2019, Revolut was initially launching online current accounts before they moved on to other products with higher margins. In the next raise, the company is looking at a valuation between $5bn and $10bn.

Libra Association still battling it out

Libra experienced the loss of major members in the most recent weeks. The list includes Visa, MasterCard, eBay, Stripe, Mercado Pago and PayPal, all of which decided to exit the project but are willing to re-join the association once the regulatory issues are solved.

The scrutiny by regulators and lawmakers continues, as they are still worried about the Libra project and how it’s a risk to the financial stability of countries around the world.

It’s still early stages, and Facebook’s Libra will not step down since they’ve spent millions on the project thus far. David Marcus, Head of Calibra, has tried to convince Congress that Facebook has no say in key decision making and how the system will be governed. Facebook acts like all other members of the initiative. According to finance commissioner Valdis Dombrovskis, he’s proposed rules to regulate Libra. Even though times seem hard for Libra now, if Europe finds a common approach to crypto-assets such as this project, then Libra is still going for launch in 2020.

Klarna’s Political Backlash

There has been much dispute between Klarna and Sweden’s minister for financial markets and housing, Per Bolund. He said that customers should not be fooled into “payment paths that cost more” and since then he’s been giving Klarna and other similar companies a hard time.

The fact of the matter is, Klarna offers a basic “pay later” option that does not cost more, assuming customers pay back on time. On the contrary, customers who do in fact “pay later” will have a higher purchase frequency and expense rate of 20% more than those who pay back immediately. The “slice it” program also puts customers in debt which can affect their credit rating. So ultimately, they would spend more.

Klarna depends on regulatory openness from host governments so they need to avoid getting into political disputes. Even though the Fintech company has expanded on an international level, it doesn’t need a political backlash from any government, especially Sweden’s.

Christopher Zenios

Christopher has always been a pioneer, a first adopter when it comes to technological advancements. Over the years, his expertise surrounded the real estate and digital markets and their evolution in today's society. After being the editor to various professional business news portals and blogs, he was selected to become the chief editor for HWC. Contact Christopher at +357-22029786 ext: 6110 or by email at [email protected] for editorial related questions.

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