Q4 Rise FinTech Report 2019 - RISE by Barclays
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Rise FinTech Q4
Report 2019
#HomeofFinTech
Hello Contents
Welcome to the Q4 2019 edition of the Rise FinTech 03
report, our regular take on the latest trends, topics, Foreword: 12
successes and happenings in the world of FinTech. Strength in numbers, Rise global ecosystem Q4
depth in technology
In previous editions, we’ve looked at the FinTech scene 14
in London, Israel and New York so this time we’re focusing 05 Rise global 2020 forecasts
on Asia, a region of constant innovation driven by China Editorial special:
and India, which continue to be the largest FinTech hubs The evolution of the
18
based on investment. Across the region, both consumer Rise ecosystem insights Q4
payments ecosystem:
interest in startup technology and government support learnings from 20
are considerable, making Asia fertile ground for disruptive The Fintech Yatra Case study: Crediwatch
innovation.
07 21
In this edition, we share some 2020 predictions and This quarter’s spotlight: Case study: Fluid.ai
views from our Rise platform site leads as well as FinTechs set for
important developments in technology and trends that mainstream adoption 22
are impacting FinTech startups and the wider Asian in India Join Rise
population.
We also have an article by Abhishant Pant, founder of 09 23
Asia insight: The Rise platform
The FinTech Meetup, who has made an epic 25,000 km
Three prominent in numbers
road trip to identify how advances in financial services
FinTech nations
and financial inclusion are helping address the needs of a
large part of the population across Asia. 11
We hope you enjoy the contributions in this report. Top trends for FinTech
in Asia
Rise is a global network of the world’s top innovators
working together to create the future of financial services.
#HomeofFinTech 01 / rise.barclays
Foreword:
Strength in numbers, depth in technology
A broad spectrum “We must take the blockchain as
an important breakthrough for
there, Asia continues to innovate across
a broad spectrum of technologies. In
of technologies independent innovation of core
technologies.” That’s how, in October
India for example, there are solutions
like IndiaStack, Aadhaar and Unified
across the region 2019, China’s President Xi described
what appears to be one of the first
Payments Interface, three initiatives
that are helping to transform not just
examples of a major world leader the country’s infrastructure but also the
backing that technology. He further lives of the underbanked and unbanked.
stated that blockchain technology has Read more about these projects in our
a wide array of applications within Asia insight in this report.
China, from finance and transportation
Singapore is another powerhouse of
to social impact. With a history of rapid
innovation. The country is opening
and huge investment in other tech such
up its banking industry to technology
as AI and big data (and more recently
companies like Razer, the leading game
6G mobile networks), China is sure to
brand, who (through partnerships) is
make successful advances this time
applying for a digital banking licence
too, just as Singapore did several years
in the country. The company intends
ago with Project Ubin, a collaboration
to build Razer Youth Bank targeting
across the financial services and
the under-served and digital-savvy
FinTech sectors aimed at blockchain
millennial market.
and Distributed Ledger Technology
(DLT) solutions for payments and These are just a small sample of the
securities. many exciting FinTech developments
taking place in Asia. Given the potential
To back up President Xi’s words, the
and appetite for change across the
Chinese government has announced
region, there is no doubt there will be
its intention of turning Hainan into the
many opportunities for us all to play a
‘blockchain province’ to develop the
part in the future.
technology and to foster expertise in it.
Furthermore, since March 2019, more
than 500 blockchain projects have
been registered with the authorities in
China, cementing the country’s position
as the world’s most prolific filer of
patents.
But disruption in Asia isn’t all about
Gus Macfarlane
blockchain in China. The region as a
Chief Operating Officer
whole has received greater investment
Technology and
than any other in the world. As a result
Innovation Barclays
of increasing numbers of customers,
its developing digital infrastructure
and the number of global tech giants
02 / rise.barclays 03 / rise.barclays
Building a robust and Editorial special:
evolving payments The evolution of the payments ecosystem:
ecosystem learnings from The Fintech Yatra
About 1 ½ years ago, I decided to map and societal benefits if all of these
the world’s FinTech startup landscape– payments were made directly into
one country at a time. Since then I have verified bank accounts.
followed that map, travelling more What have I learned from these
than 25,000 km by road through India, observations and the experiences I’ve
Myanmar, Singapore, Oman, UAE and picked up along my trip? First, it’s
Bahrain. I have a dream to someday important to recognise that there’s a
chart all the FinTechs between Mumbai long way to go. Considering the friction
and London by road. that exists even in affluent and evolved
I’ll share some of my observations so markets like Singapore, developing a
far on this journey, specifically focusing robust payments ecosystem will take
on one area of great interest to me, time, especially in rural areas.
the benefits to society of a robust and
A good start is to create segmented
evolving payments ecosystem in those
payment solutions like those
countries.
specifically for transit systems, small
• The underground or black economy:
businesses, peer-to-peer scenarios and
Various estimates suggest that the then over time connect these solutions
underground economy accounts for to a unified ecosystem.
25-75% of GDP. This represents an
enormous loss in tax revenue. Even if Regular and faster settlement is
a quarter of the tax were collected, also key. Given that new solutions
the impact on infrastructure, will compete with cash, they’ll need
healthcare and social wellbeing could to provide immediate, full and final
be enormous. settlement. Anything less effective
• The cost of cash: Operational costs simply won’t succeed.
to the economy of managing billions Finally, be aware that change will
of currency notes and coins, along spread from the cities. Solutions will
with counterfeit money, are large. emerge and gain critical mass most
The lost productivity costs of cash effectively from those connected hubs.
lying around in wallets, cupboards Building a payments ecosystem in big,
and under mattresses are even metropolitan areas will be easier and
bigger. Lack of secure storage places a good way to test, learn and iterate.
a disproportionate burden on the Follow my journey at
poor. The benefit of having a reliable, thefintechmeetup.com
digitised payments ecosystem would
bring substantial cost efficiencies and Abhishant Pant
reduce this burden. Founder
• Inefficient government programmes: The FinTech Meetup
Billions are lost in leakage from
government subsidies and welfare Follow Abhishant:
schemes that provide fertiliser, food abhishantpant (LinkedIn)
and fuel to deprived members of @AbhishantPant (Twitter)
04 / rise.barclays society. Just think of the savings 05 / rise.barclays
This quarter’s spotlight:
FinTechs set for mainstream adoption in India
The Government of India’s vision of a Thanks to government measures and
Digital India is paving the way for rapid the efforts of private players, India
digital banking and FinTech adoption. is a massive, connected consumer
India, along with China, has the highest market. Over half of the population
adoption rate (87%)1 of FinTechs among now has access to mobile phones
consumers. Two key enablers of this and the internet, and data costs have
FinTech wave are digital infrastructure declined by almost 95% compared to
and financial inclusion. 2013. Through the government’s mass
financial-inclusion programme, Jan-
IndiaStack, a set of open APIs that Dhan Yojana, 80% of Indians now have
helps governments, businesses, access to a bank account, compared to
startups and developers solve some of just 53 percent a few years ago. Price
India’s most intractable problems, has comparison sites, such as BankBazaar
proved to be a revolutionary tool in the and Paisabazaar, are also growing
country’s efforts to transform its digital in popularity and provide access to
infrastructure. It’s helping drive India a range of products from banks and
New image and layout towards a presence-less, paperless other financial service providers.
and cashless service delivery. Key
components of the new digital Payments startups have dominated
infrastructure are Aadhaar and Unified the FinTech scene here. Almost 60%
Payments Interface (UPI). Aadhaar of India’s retail transactions (by value)
is a verifiable 12-digit identification is expected to be digital by 2025. And,
number issued by the Government with a funding gap of $300 billion in
of India to residents free of charge. consumer credit and $200 billion in
60% of India’s retail So far, it’s already provided unique SME financing, lending startups are
identification numbers to 1.1 billion beginning to gain as much prominence
transactions expected people. Unified Payments Interface as their payments counterparts. Of
(UPI) is an advanced public payments all startups, those that specialise
to be digital in five years system that’s already facilitated 2.7 in two areas have attracted most
billion phone-based bank transfers funding in Q3 2019: leveraging digital
without the need for account details. lending platforms and using innovative
Regulators have played a key role alternative credit models for financial
by launching sandboxes so FinTechs institutions and Non-Banking Financial
can connect with banking tech and Companies (NBFCs).
regulatory environments. Using
IndiaStack APIs as the foundation, Lincy Therattil
Open Banking has started to take off FinTech Platform Lead
as consumers seek the dual benefits of
Rise Mumbai
trust from banks and cutting edge user
experiences. Follow Lincy:
lincy-therattil-9010157
(LinkedIn)
@LTherattil (Twitter)
1 EY Global FinTech Adoption Index 2019
06 / rise.barclays https://tinyurl.com/r87kyym 07 / rise.barclays
Asia insight:
The rise of the super app,
an Asian phenomenon Three prominent FinTech nations
Governments and businesses across Neobanks are also emerging across
Asia are investing in FinTechs – Asia. Many markets have issued virtual
both to promote financial inclusion banking licenses to young startups.
and commercial gain. The leading Razorpay in India, for example, offers
nations in this space are China, India convenient access to financial services
and Singapore. According to the for millions of SMEs who typically
latest rankings2, 34 companies from do not meet the lending criteria of
Asia figure in the top 100 global traditional banks. Recently, Razorpay
FinTech innovators. Government and launched a corporate credit card to
regulatory support is a clear driver small businesses, leveraging non-
of this success. For example, the traditional methods of assessing
Monetary Authority of Singapore clients’ eligibility and creditworthiness.
has committed $168 million over the
Non-Asian companies are also an
next five years to grow the ecosystem
important part of local FinTech
in Singapore. Another key driver is
ecosystems. They target Asia for its
consumer demand – according to the
large customer bases, advanced digital
latest EY FinTech Adoption study, “in
infrastructure and consumers who are
just two years, consumer usage rates
responsive to new technologies. These
of FinTech-powered services have
global players regularly cooperate
doubled, and in some cases tripled,
with local partners to access the
across key Asia-Pacific markets.”
market. The UK is among the largest
In India, payments startups are front- exporter of financial services,
runners in the industry as they address FinTech companies and talent to Asia,
the difficulty that the underbanked and particularly India.
unbanked have in making payments.
This is a definite trend we’re seeing in
Rise Mumbai (see p17). In recent years,
this trend has been supplemented by
many lending and wealth startups.
Uniquely in Asia, we see an expansion
in ‘super apps’. A super app is like a
Swiss Army knife, a one-stop-shop Sanjaya Shrestha
app that offers multiple services in Director of Innovation
a single application. An example is Rise Mumbai
Grab Financial, which is seeking to
be the everyday app for consumers in Follow Sanjaya:
Southeast Asia. Grab offers payments, sanjaya-shrestha-440513
lending and insurance around its core (LinkedIn)
ride-hailing business.
2 H2 Ventures and KPMG Fintech100 report
08 / rise.barclays https://tinyurl.com/tpomv38 09 / rise.barclays
Top trends for FinTech in Asia
Innovative technology, competitive echoes the comments from Sopnendu
banking incumbents, government Mohanty, Chief FinTech Officer at the
initiatives and regulatory leadership Monetary Authority of Singapore, that
are all creating an appetite for FinTech Distributed Ledger Technology (DLT)
in Asia. Let’s take a look at some of the and blockchain are core to Singapore’s
emerging trends in the region. FinTech ecosystem.
Sustainability and green finance – New standards required to drive
FinTech for good growth
Increasingly, banks in Asia are There are growing calls for international
leveraging the talent and power of the standards to help innovation scale.
financial system, and recent advances Shared standards will facilitate the
in technology, to create a more cooperation required to realise the
inclusive and empowered society. The benefits of emerging technology,
financial sector is increasingly expected especially Smart Contracts. Standards
to take an active role in helping tackle will also address the problems of
climate change and encourage global monopoly, centralised misuse and single
collaboration in this area. points of failure in existing systems, and
Government support for unlock new business models in FinTech
digital currency and LegalTech ecosystems.
The Chinese Government has Blockchain, IoT and AI are converging
announced its ambition to be the first A growing theme in Asia is the
country to launch a digitised domestic convergence of three technologies
currency, also known as a Central Bank – the Internet of Things (IoT), DLT
Digital Currency (CBDC). Unfortunately and Artificial Intelligence (AI). If
for China, the central bank of consensus can form and get industry
The convergence of Cambodia appears to have already
taken this crown with the launch of its
investment, these technologies could
become synergistic, with a blockchain
three technologies - Bakong project3 which aims to eliminate
transfer fees and create a real-time
acting as a distributed, decentralised
and immutable ledger used to store
IoT, DLT and AI payments infrastructure.
A trustless digital world, where DLT
encrypted data gathered from IoT
sensors, and AI acting as the ‘brain’
is the future that analyses and makes decisions on
the data.
CEOs of leading international and Oliver Tod
local Asian banks recently shared a Digital Law Associate
panel at the 2019 FinTech and SWITCH at Herbert Smith
Innovation Festival. One discussion Freehills and
point was their shared desire to Barclays Innovation
create a ‘trustless’ and frictionless Legal Secondee
financial system using Distributed
Ledger Technology (DLT). This Follow Oliver:
oliver-tod-a9938a117
(LinkedIn)
10 / rise.barclays 3 https://www.cryptopolitan.com/cambodia-dlt-for-cross-border-payments/ 11 / rise.barclays
Rise global
ecosystem Enterprise
Solutions
Innovation
Services
Q4 Capital
Markets
& Trading Lending
Risk,
Blockchain Compliance
& RegTech
Banking
& Payments
Services
AI, Big
Wealth &
Data &
Investment
Machine
Management
Learning
This infographic shows companies resident at
our Rise sites. The information is accurate at
12 / rise.barclays the time of publication. 13 / rise.barclaysRise global 2020 forecast:
Rise London
2020 forecasts
With a new decade ahead of us, we our support for Tel Aviv FinTech Week 2020 will be all about data, data, data. This year, Rise will be running a pop-up
couldn’t be more excited and proud at the beginning of February. Israel is Last year saw the UK’s banking system space at the initiative’s Global Summit
to use our Rise ecosystem to bring renowned as the ‘startup nation’ and deliver PSD2. It’s fair to say that UK and hosting fringe events at our home
together the key players in FinTech from the country’s expertise will continue banks are just beginning to produce in Shoreditch. UK FinTech Week brings
around the world. 2020 is a big birthday to be dominated by deep technology game-changing APIs that appeal to together the best minds in the business
for Rise as we officially turn five, solutions that startups offer to the FinTechs. This year, we anticipate to identify and discuss the latest hot
marking a key milestone on our journey. rest of the world. In 2019, we saw continued drive in that direction. We topics and disruptive change. There
This year, we’re not only focusing on our these solutions being applied in the predict the banks will take further will be ample opportunities for Rise
physical locations, we’re also expanding areas of payments, credit, lending and steps and continue to respond to Open and our members to connect with each
our digital connectivity. As the global insurance. We anticipate these areas Banking by delivering richer services other, thought leaders in the industry,
lead for the Rise platform, I’m proud to will continue to grow in 2020. There’s to customers of all demographics. and the wider FinTech ecosystem.
have been part of the Rise journey for also no doubt we’ll also see more Collaboration with FinTechs will be
half of the last decade, to have set Rise advances in cybersecurity, an area of key, and that’s sure to ramp up over
up for success and, looking forward, excellence for the Israeli FinTech scene the next 12 months. So much so, that Clare Whitehead
to help shape the next 10 years of that proved its robustness in 2019 with we think partnerships, mergers and Rise London
innovation in financial services. impressive funding of ca. $1.9 billion acquisitions will be the top headlines
across 78 deals, almost double that for 2020. Follow Clare:
Keeping an eye on trends in FinTech @clarewhite200
in previous years. In part, this will be
is at the core of what we do. With the We’re also extremely excited about (Twitter)
due to the successes of innovative
help of our Rise members, ecosystem UK FinTech Week, 20th - 24th April.
companies like Armis, Twistlock,
partners and thought leaders we
Puresec and Demisto, all of which were
bring insight to our network through
acquired in 2019 for significant sums by
initiatives like our Rise Presents events,
big tech players. We anticipate more
the Rise FinTech Podcast and the very
deals like this in Israel this year.
report you’re reading now.
And what of our other global locations?
2020 brings new opportunities, new
It’s over to the platform managers from
investments and, of course, new
each Rise site, who take a look at what
transformative technologies. In this
2020 holds for their regions.
section, our local site leads provide their
thoughts on those things – the most NY MUM
pertinent FinTech trends to watch out
for in their parts of the world. Magdalena Krön
Before I hand over to London, New York Rise Global FinTech LDN
and Mumbai, let me share the outlook Platform Director
from Rise Tel Aviv.
The year is starting strongly at that
site, Israel’s #HomeofFinTech, with TLV
14 / rise.barclays 15 / rise.barclays2020 forecast: 2020 forecast:
Rise New York Rise Mumbai
Mergers and acquisitions in the US passionate about helping cutting-edge In 2020, I anticipate several local I’m really excited that Rise Mumbai
market will be a big trend in 2020, with startups and scaleups connect, create and global FinTechs will continue is the leading FinTech hub in India
top FinTechs angling to be acquired and scale their businesses here, and to target the large Indian consumer and is deeply integrated with the
and top financial services companies we continue to host some amazing market with innovative financial Indian FinTech landscape. This
fighting over the best ones. In this companies as well as a series of events products. The uptake of FinTech close relationship will continue
regard, Visa’s recent acquisition and programmes to support the solutions for payments and lending is in 2020. As examples, our recent
of Plaid for $5.3 billion is just the community, foster talent and see the especially promising. memorandum of understanding with
beginning. Expect some other big very best in technology take shape. the Indian Chamber of Commerce
payouts this year. In addition, with the Government’s promotes startups across India, and
financial inclusion and financial we’re working with the local startup
At Rise New York, we are excited literacy initiatives playing out, several ecosystem and Barclays colleagues
about New York FinTech Week, Ilana Fass innovative and affordable micro- to create compelling innovations and
30th March – 3rd April, that will see Rise New York offerings are evolving to cater to the investment opportunities for clients.
discussions and events take place unbanked and underbanked segment.
covering the latest technology,
companies and trends. Rise Mumbai has a current focus on Lincy Therattil
data analytics and reporting, cognitive Rise Mumbai
This year will also see us continue to automation and AI-enhanced solutions
facilitate and build out the FinTech Follow Lincy:
like facial recognition and digital Know lincy-therattil-9010157
ecosystem at our central, flagship hub Your Customer (KYC). Several Barclays
in the Flatiron District of the city. We’re (LinkedIn)
clients in India have shown a keen @LTherattil (Twitter)
interest in partnering with Rise
Mumbai startups to improve their
alternative lending capabilities.
NY MUM NY MUM
LDN LDN
TLV TLV
16 / rise.barclays 17 / rise.barclaysRise ecosystem
insights Q4
London Tel Aviv
• $569m in VC investments • $118m in VC investments
• 51 VC deals • 3 VC deals
• Top VC deals: • Top VC deals:
Zopa – $181m Jasper/CreditStacks* – $110m
Rapyd – $100m Otoma – $8m
Tide – $55m Magic Square – undisclosed
• 7,800+ Rise visitors • 1,800+ Rise visitors
• 82 Rise events • 24 Rise events
New York Mumbai
• $327m in VC investments • $70m in VC investments
• 41 VC deals • 4 VC deals
• Top VC deals: • Top VC deals:
Octane Lending – $47m Acko General Insurance – $36m
Digital Asset – $35m Amica Financial Technologies – $24m
Bison Trails – $26m • 2,800+ Rise visitors
• 3,800+ Rise visitors • 59 Rise events
• 58 Rise events
Rise New York re-opened in October 2019. Some data may be affected as a result.
VC investment statistics are for the fourth quarter of 2019, provided by Innovate
Finance and are not limited to Rise ecosystem companies.
18 / rise.barclays * CreditStacks renamed Jasper 19 / rise.barclaysCase study: Crediwatch
The proposition Value
A software and data-as-a-service • Reduction in the overall lead
platform that provides an automated, time for the Know Your Customer
intelligent and curated data marketplace (KYC) process
(using consent-based blockchain • Smoother KYC process as only
architecture) to aid faster and accurate relevant inputs are required from
credit decision-making at scale. The the customer
company’s platform uses proprietary
credit and other risk assessment models • Improved customer experience
to provide actionable intelligence for with reduced onboarding time and
dynamic credit management. minimal documentation requested
by the bank
Key features
• Real-time monitoring predicts
delinquency with a lead time
of a year
• Derives insights from distributed
and unstructured data sources,
• Frees up resource time for front
using proven computational office staff enabling them to focus on
techniques like Machine Learning, their core work
Natural Language Processing and
visualisation to help businesses The Barclays partnership
make fast and smart decisions
• Automates loan portfolio monitoring Crediwatch completed a proof-of-
with a predictive engine and alerts concept (PoC) as part of the Barclays
• Combines public data with consent Accelerator programme and created
data to create a 360 degree picture a customised KYC offering for the
Barclays Corporate Banking business.
After a six month pilot engagement
and additional customisations,
Crediwatch has been onboarded
as a vendor by Barclays.
crediwatch.com
20 / rise.barclays 21 / rise.barclaysCase study: Fluid.ai
The proposition Value
Fluid.AI is an artificial intelligence (AI) • Resourcing is based on call volumes,
platform that uses machine learning to allowing optimal employee allocation
drive decision-making for a variety of across departments
business operations. The AI is plug-and- • Reduction in hiring costs
play so there’s no installation overhead,
and is connected to hundreds of • Quicker resolution of queries
data sources to maximise intelligent • Drives sales and marketing initiatives
decision-making. – explore products interactively, and
Fluid.AI also uses AI to create sign up for a bank account or credit
sophisticated virtual customer card in minutes
assistance for firms with a physical
presence. Motion-sensitive cameras The Barclays partnership
mounted in a kiosk detect customer
reactions, facial expressions and
gestures to apply for a loan, assess The Barclaycard Technology team
credit card options or get the in India is working with Fluid.AI to
latest rates. develop a solution that provides
intelligent predictions on demographic,
transactional and campaign-specific
Key features response data for cross- and up-selling
to cards and loans customers.
• Genetically evolving predictions
that continuously learn from fluid.ai
previous decisions and become
smarter with time
• Speaks to customers and puts them
in a digital environment where they
can explore using gestures and voice
• Automatically recognises customers
using advanced facial recognition
• The entire customer experience
works seamlessly on mobiles
22 / rise.barclays 23 / rise.barclaysJoin Rise
The mindset of a startup, the expertise of a bank
The Rise platform
in numbers
Why join? What you get:
At the #HomeofFinTech,
conditions for innovation
and growth in financial
Unique FinTech
workspace 1,000+
services are unmatched.
Global like-minded
community Individual Rise members
We have helped over
175 FinTech companies Access to
175+
investors
globally who call Rise home,
raise capital and navigate Help from advisors
the hurdles of financial and mentors
regulation and compliance
to build the future of Barclays industry Rise FinTech resident companies
financial services. Together. expertise and support
rise.barclays Global industry
80,000+
events
Yearly visitors (2019)
35,000+
24 / rise.barclays Social media followersAbout Rise, created by Barclays
Rise, created by Barclays, is a global community of the world’s top innovators
working together to create the future of financial services. With a diverse
network of FinTech talent, one of the world’s leading accelerator programmes
and workspaces based in the main FinTech hubs of the world, Rise is an exclusive
place for FinTech companies to connect, create and scale together with Barclays.
To join our community, or keep in touch with the latest Rise news,
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This report is proprietary to Barclays Bank PLC. Every attempt has been made to try to ensure that the information contained in this guide is accurate at the
time of publication. However, the views and opinions featured in this article are the views of the authors alone, and do not necessarily reflect the views of
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the Barclays Bank PLC Group (‘Barclays) nor should they be taken as statements of policy or intent of Barclays. Barclays takes no warranties or undertakings
of any kind, whether express or implied, regarding the accuracy or completeness of the information is given. Barclays accepts no liability for the impact
of, or any loss, however arising, from, any decisions made based on information contained within this report. You should seek further advise based on your
circumstances before acting on any of the information included in this report.
Rise is a trade mark of Barclays plc, used under licence. Registered in England. Registered No: 1026167. Registered Office: 1 Churchill Place, London E14 5HP.
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