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OPEN by Eliga October insights

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In October, HSBC announced it will launch its Banking-as-a-Service (BaaS) offering with NetSuite.

 

According to Finextra, ‘The two firms will embed international payments and expense management services into NetSuite’s new SuiteBanking offering.’ This will make it fast and easy for NetSuite customers to pay bills. They can also send invoices, get paid and gain ‘full cash flow visibility from a unified system.’

HSBC also plans to expand its BaaS offering with the Global Wallet product, a digital wallet that offers multi-currency for payments.

Barry O’Byrne, CEO, global commercial banking, HSBC, said that the bank will be able to partner with its clients ‘to offer business banking propositions to their customers - integrated into their platforms and with the backing of HSBC’s technology and international network.’

 

The rise of Banking-as-a-Service

According to Insider Intelligence, the rise of Banking-as-a-Service (BaaS) platforms can be attributed to new technologies opening legacy systems to emerging start-ups and third parties. BaaS platforms promote financial transparency, driving innovation in the industry by opening APIs for third parties to develop new services. These platforms can be monetised by charging clients a monthly fee for access or charging for each service used.

Top providers offering a BaaS solution:

Starling Bank can be classified as a BaaS provider with B2C operations. Fidor Bank and BBVA are other examples of providers offering a BaaS product with B2C operations.

 

UniCredit & JP Morgan join forces in SWIFT Go Project

UniCredit and JP Morgan announced a partnership to allow small businesses and consumers to send quick and secure ‘near real-time cross border payments at a competitive price, joining the SWIFT Go project.’

The official press release from UniCredit stated that the innovative collaboration will ‘leverage both JPMorgan's PayDirect solution and SWIFT Go to make payments of up to USD 10,000 to any JPMorgan Chase branch in the US.’ Payments will be credited on the same day, free of charge for the beneficiary. This month’s announcement represents the first stage in SWIFT Go’s roll-out in the United States with further services planned to roll out in Europe in the future.

According to Stephen Gilderdale, Chief Product Officer, ‘ SWIFT Go is part of the company’s vision enabling ‘anybody, anywhere, to send money instantly and securely around the world.’ It is aimed at customers who expect a payment experience that is not only transparent but also fast and seamless.

  • Ten banks are already live with SWIFT Go.
  • JP Morgan Chase Deutsche Bank and China Minsheng Bank have gone live, which represents 41 million low-value cross-border payments a year.
  • In total, SWIFT announced that 100 banks around the world have signed up for the project since it went live in July.’

 

Bank branch closures in the UK & Ireland

Following the news that the FCA was considering rules to stop banks from shutting their branches, Finextra reported that the Bank of Ireland will shut a third of its branches. It’s reported that COVID-19 changed customers’ behaviour with 70% of the Bank of Ireland’s customers now digitally active with a further 26% registering for the new mobile app since its launch. A shift to digital-led savings also resulted in significant savings.

  • According to Which?, Barclays closed the most branches last year, followed by TSB.
  • TSB, Santander, HSBC, and Barclays closed bank branches in 2021.
  • M&S closed its in-store branches in July 2021.

Although banks are closing branches across the UK & Ireland, post offices will carry out some transactions helping preserve UK access to cash with banking hubs.

 

Jeremy Newman joins the OBIE

At the end of October, the Open Banking Implementation Entity (OBIE) announced it appointed Jeremy Newman as an Independent Non-Executive Director (NED). The announcement noted that he will ‘play a pivotal role in supporting recently appointed OBIE Chair Charlotte Crosswell.’ The appointment will help support user adoption and drive FinTech innovation.

 

Monzo rethinks its US expansion

Monzo withdrew its banking licence application for the company’s US start-up. The neobank said it was still committed to expanding its US presence. It is currently partnered with Ohio’s Sutton Bank. In September, Monzo reached its 100k business customer milestone after 18 months.

 

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