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Top 10 Fintech News Stories for the Week Ending June 3, 2023

Top 10 Fintech News Stories for the Week Ending June 3, 2023

Fintech Weekly News

This week saw news from some of the biggest fintech and banking names with Stripe launching credit card issuing, Chime’s revenue numbers were solid but growth is slowing, JPMorgan is diving deeply into AI, open banking and AI are seeing prototypes in the UK, and the OCC is targeting big banks. Here are what I consider to be the top 10 fintech news stories of the week.

Fintech giant Stripe is getting into the credit game from TechCrunch – Stripe started issuing debit cards back in 2018 with its Stripe Issuing service and has reportedly issued more than 100 million cards in the U.S. for the likes of Shopify and Ramp. This week the leading payments fintech announced that it is adding credit card issuing into the mix. These cards will be issued through its partner banks, Cross River and Celtic.

Chime’s Slowdown Highlights Limits of Bank Disruptors from The Information – This in-depth piece on Chime provides new data on this country’s leading neobank. Revenue at Chime last year was more than $1 billion with Q1 revenue coming in at $305 million, up 27% year over year. but the company lost $45 million on an adjusted EBITDA basis. The company continues to struggle with fraud and is still experimenting with a small dollar lending product.

The Impact Of ChatGPT And Open Banking Cannot Be Underestimated from Forbes – In his latest Forbes column, Dave Birch takes us through the early days of aviation and compares it to what is happening today with open banking and ChatGPT. He surmises that we are at the very beginning of a revolution in financial services where soon automated bots will be performing many mundane financial tasks on our behalf and this will lead to better financial health.

JPMorgan Chase aims to create $1.5 billion in value with AI by yearend from American Banker – JPMorgan is investing $15 billion in technology in 2023 which will include substantial investments in AI and data analytics. The leading bank expects these AI investments to deliver “$1.5 billion in business impact by the end of the year.

OCC targets big banks with ‘persistent weaknesses’ from BankingDive – The OCC updated its policies and procedures manual on bank enforcement actions this week, targeting large and complex banks. Basically, there will be more stringest consequences now for banks that don’t correct persistent weaknesses.

4Q overdraft revenue fell 50% in three years, CFPB says from American Banker – Overdraft revenue for banks continues its steady decline. Banks reported $1.6 billion in overdraft revenue in last three months of 2022 and $7.7 billion for the year, declines of 48% and 35% respectively according to the CFPB. Banks are not raising other fees to make up the shortfall.

Acquisitions Are Driving A Shake-Up In Payments – And There’s More To Come In 2023 from Forbes – There is probably no vertical within fintech that has undergone more change in the past decade than payments. We are starting to see M&A heat up with Fifth Third acquiring Rize Money just last month. At the same time major players are looking to sell divisions to streamline their operations with PayPal looking to sell its remittance player Xoom.

Is the digital euro near? Prototype exercise results revealed from Fintech Nexus – The European Central Bank continues its work on a digital euro with prototypes being finalized now. Interestingly, it has separated out back-end and front-end functions and is considering a range of use cases including the possibility of offline transactions.

British digital bank Monzo hits monthly profitability for the first time after spike in lending from CNBC – Digital banks from across the pond continue to perform well. Last week we saw Starling Bank report record profit and this week archrival Monzo also shared that they are now profitable on a monthly basis.

Fintech Kiwi gets $80M to lend to Latinos in the U.S. from Fintech Nexus – Latin American fintech startup Kiwi has closed on a $75 million debt facility and has also raised $4.5 million in seed capital. Based in Puerto Rico it is focused on providing loans to Latino consumers in the United States.

Below is the audio from the weekly news show, this week featuring special guest Ron Shevlin.

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