The headwinds of COVID-19 have altered nearly all aspects of people’s future across the globe, and have plunged the world’s financial markets into a fast-moving state of disruption and uncertainty. For the financial services industry, the consequences of the pandemic have compressed a decade’s worth of change into less than a year, proving itself the mother of opportunity in accelerating digital transformation.
While challenges have been inevitable when adapting to the rapid shift in consumer behaviour and restructuring of business operating models, the imperative to embrace and adapt to this period of change has never been greater.
These new realities have fueled the growth and value of breakout players in the fintech space. A new era of innovation is in full swing and will undoubtedly make for extraordinary tales when cementing the impact of fintech startups on their respective sectors.
We’ve prepared a list of fintech startups that are proving to be promising frontrunners in the race to be the UK and Ireland’s leading disruptor.
Amid the global turmoil unleashed by COVID-19, the fight against financial crime wages on. The need to improve anti-money laundering technologies (AML) has never been more pressing as international crime syndicates and cyber criminals become increasingly more aggressive and sophisticated in their methods. QuantaVerse, is one such platform leading the charge in providing AI-powered AML solutions to assist organisations in automating the identification and investigation of financial crime.
To supercharge the defences of businesses during the pandemic, QuantaVerse enhanced its Financial Crime Investigation Report (FCIR) to allow investigators to adjudicate a higher volume of cases by automating the collation and analysis of vast amounts of data. Its leadership is also impressive with CEO and Founder, David McLaughlin, combining extensive experience from his military and financial services careers, to pack a punch in the battle to defeat human traffickers, corrupt officials and terrorists from exploiting the financial system’s pain points.
Swedish fintech, Tink, has quickly become one of Europe’s leading open banking platforms that enables banks – most recently partnering with banking giant BNL – fintechs and startups to develop personalised financial services products through transforming raw, unfiltered financial data into actionable information.
2020 propelled the fintech to even greater heights with a €90m fundraise in January and a further €85m raised in December after extending the round, drawing in investment from Dawn Capital, HMI Capital and Insight Partners.
ClearBank, a state-of-the-art cloud based clearing platform, provides access to a wide range of real-time payment services to improve customer experience. The API-based banking services ClearBank offers banks greater opportunity to create more customised and efficient experiences for customers, which has become especially important in this last year.
ClearBank has proved itself a game-changer for smaller banks, credit unions, fintech startups and building societies who were previously reliant on the ‘big four’ to clear their payments. In just over 5 years it has over 80 leading financial institutions live on its platform and over a hundred in the pipeline. The fast-growing firm recently partnered with Tide with the ambition to support SMEs through the pandemic and there is little reason to doubt their ability to succeed.
The quality, integrity and reconciliation of data is no longer a nice-to-have in today’s world, it is paramount. Duco’s SaaS solution enables banks, asset managers, brokers and exchanges the ability to normalise, validate and reconcile any type of data on its cloud platform.
Duco has raised nearly £24m to date and has grown to over 100 staff worldwide. That’s not all, when the coronavirus outbreak hit, Duco offered government health authorities across the world free training and services to improve data aggregation and reconciliation tasks.
A new wave of challenger banks who are redefining what a consumer-first brand operates like are setting their sights on entering the banking and lending space. Up against traditional banking giants, the importance of building a future-proof and agile model at scale is critical to success.
LEVERIS, an end-to-end digital banking platform, has stepped onto the scene to make that vision a reality. The platform was machine-tooled to dramatically reduce the cost and timeframe of digital transformation, enabling the set up of fully functional digital banks within a matter of weeks. With COVID-19 the ultimate proof that the future of banking is digital, we expect to see LEVERIS firmly establishing itself in the sector.
Even prior to the pandemic, regulatory requirements proved a complex challenge for financial institutions when improving compliance. Suade, an innovative regulation-as-a-service (RaaS), has been a welcome addition to the RegTech sector.
Its platform helps firms fulfil their regulatory obligations by finding the required regulatory data, calculations, risks and reports with the necessary control and governance needed to bring airtight transparency to the process. With the mission to prevent the next financial crisis using a data-driven approach to regulation, CEO and Co-Founder, Diana Paredes, is proving Suade is up to the task.
Since its launch in 2016, TrueLayer, a provider of financial APIs, has moved from strength to strength. Its platform now connects over half of all UK open banking traffic, with partners that include Monzo, Plum, and Revolut.
The startup provides an interface between financial institutions and third-party applications via an API to enable payment initiation, account verification and aggregation, alongside many more features. In 2020, TrueLayer attracted $25 million in its Series C round, and continued to build its presence across Europe and new industries.
Not only has London-based lender, OakNorth, topped the FT 1000 list of Europe’s fastest-growing companies but also agreed over £1bn in loan approvals since the start of lockdown. The credit intelligence technology developed by OakNorth has signalled a new era for commercial lending. In a time where businesses need it most, OakNorth has provided a better borrowing experience by featuring as a prominent lender in the Government’s Coronavirus Business Interruption Lending Scheme (CBILS).
The road to economic recovery is set to be a long one, and financial institutions, fintechs and the wider sector are at a turning point in their responsibility to assess what transformation needs to take place to truly find ourselves in a better position. One thing is certain, the pandemic will continue to bring with it greater incentive for fintechs to prove themselves as trailblazers in the arena.
If you are unsure of what fintech actually encompasses, then see below: