Founded in 2018 by Cynthia Wandia and David Hwan, Kwara has built a digital banking platform that is primarily designed to help the unbanked and underbanked people to help build wealth in a frictionless way. The company also offers a management platform that helps drive efficacy and automation at the cooperative staff level.

Kwara also connects the savings cooperatives with banks, payment gateways and other third parties by utilising an open API. All these features come in one software-as-a-service package and it lets cooperative clients pay for their usage and get a single end-to-end solution.

Kwara CEO Cynthia Wandia told the media, “We are building a solution for people – an estimated one billion – who do not currently have access to personalised banking services. This is the result of a gap in banking-grade technology and the lack of neobank-like experiences for the end clients. We’ve been thrilled to see the excitement around the Kwara brand among credit unions and their members, which is fast becoming synonymous with a superior user experience and the future of banking. Thanks to our investors, we will now be able to offer an end-client experience that is 100 times better than what they previously had access to.”

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Monzo said in its report, “Our revenue streams have been significantly impacted by the Covid-19 pandemic and resulting macro-economic uncertainty. Regulatory reviews will also lead to stricter financial crime requirements. This may result in lower forecasted customer numbers and revenues, along with increased costs associated with correcting areas of concern. This increases the risk that the Group will not be able to execute its business plan, which could adversely impact its ability to generate a profit or raise sufficient capital to meet future regulatory capital requirements.”

With that, the challenge for the digital bank is to find ways to generate revenue from its 4.4 million users. More recently, it launched Monzo Plus which has had a good start with more than 50,000 active users. The service was launched a month ago. The launch of Monzon Plus arrived the digital bank’s first attempt at a premium account offering which did not perform as expected.

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It is reported that Venio is the first nano credit service available on smartphones for emerging markets and in the Philippines. The Venio App saw 10,000 downloads within the first of operations. The initial roll out for the app came ahead of the company;s expansion plans into high growth emerging markets in Asia and Latin America.

According to the World Bank data, nearly 1.7 billion adults remain unbanked globally, pointing to one fourth of the global population. A majority of these cases are found in emerging markets.

More specifically, 54 million adults are unbanked in the Philippines which is more than 81 percent consumers in the country. They do not have access to necessary financial products and services to meet their needs.

In this context, Venio plays an important role to address the global challenge of the unbanked population. The company’s easily accessible financing services are available through an extensive network of local and national retailers and service providers in the country. The app is intuitive, easy to use and efficient in loan processing for consumers and merchants.

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The digital bank had first launched Monzo Plus last year. However, it was scrapped after receiving a host of complaints from customers, media reports said.

It seems that the bank has a made a significant portion of its revenue from fees generated when customers use their cards. Now it is diversifying its revenue streams by introducing loans and overdrafts. In addition, it is also taking cuts from third-party services, media reports said.

Monzo faced a lot of business challenges last year. The company’s valuation has reduced by 40 percent to £1.25 billion last month on the back of the new coronavirus pandemic. According to a memo sent by Monzo to its employees, “Unfortunately we haven’t been able to achieve the goal of preventing the risk of redundancy at this time. It’s genuinely heartbreaking to share the news.” The pandemic is having a huge impact on fintechs.

That said, its co-founder Tom Blomfield also stepped down as CEO and directed his focused more toward a product-focused role in the company.

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According to N26, it no longer has a licence to operate in the UK after Brexit. It said it will close all accounts on April 15. The neobank has also asked its customers to transfer its assets to alternate accounts.

In a statement, N26 said, “With the UK having left the EU at the end of January, we will in due course no longer be able to operate in the UK with our European banking license. Therefore, we are writing to share the news that we will be leaving the UK and closing all accounts.”

Interestingly, N26 started its business in the UK just five months ago whereas Brexit negotiations were going on for over five years.

Thomas Grosse, chief banking officer at N26 told the media that the firm respects the political decision taken by the UK, and as a consequence, it will be unable to serve its customers in the UK and will have to leave the market.
According to media reports, N26 currently manages around 200,000 accounts in the UK.

Last month chief executive at N26, Valentin Stalf revealed that the firm manages around 5 million accounts globally. By the end of the first half of 2019, the Berlin-based neobank had 3.5 million accounts.

N26, which was last valued at $3.5 billion, launched its business in the US during the same period it entered the UK market. Reportedly, it had attracted around 250,000 users in the US, where it claims new customers are shifting funds from established giants like Chase Bank and Citibank.

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CIMB Bank’s mobile app, which now runs on Jumio’s AI-backed technology, will also protect CIMB Bank’s customers in the Philippines from fraud and will meet compliance mandates.

While the earlier process involved a video KYC process and took more than 15 minutes, now the process can be completed in less than five minutes.

Vijay Manoharan, chief executive at CIMB Bank told the media, “Our partnership with Jumio has been integral in achieving our milestones so far as an all-digital bank in the Philippines to deliver a safe and secure banking experience.”

Robert Prigge, chief executive at Jumio highlighted the importance of offering a streamlined digital onboarding process for banks across the greater APAC region.

According to CIMB Bank, it has signed in almost 2 million Filipinos through its digital platform. Around 30 of them are first-time bankers, making CIMB Bank the fastest-growing digital bank in the Philippines and ASEAN.

CIMB Bank in the Philippines offers savings accounts with no maintaining balance requirements, no transaction fees, and no initial deposit requirement to open an account. In the Philippines, it also offers customers the highest savings interest rates of up to 4 percent.

It also provides customers with a Visa debit card that may be used in over 25,000 ATMs across the Philippines for free.

Last month, CIMB Bank in Singapore appointed Victor Lee as its new CEO. He also serves as the CEO of CIMB Group Commercial Banking.

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Chinese ecommerce firm Zall Smart Commerce Group has formed a consortium with a group of companies to apply for the digital banking licence in Singapore. The consortium includes Japanese trading company Marubeni and Singapore-based Global eTrade Services.

Similarly, China-based real estate developer Greenland Group, through its investment arm Greenland Financial, has formed a consortium to apply for the digital banking licence in Singapore. Greenland Group’s partners include Chinese financing platform MinIPO.

The Monetary Authority of Singapore has revealed it has received a total of 21 applications so far from multiple groups. Some of the front runners for the digital banking licence in Singapore include Ant Financial, Sheng Ye Capital’s consortium, Arival Bank, an AMTD-led consortium, Bytedance, and iFast Group.

Recently, Beyond Consortium, led by V3 Group and EZ-Link also joined the race for the digital banking licence in Singapore. The consortium also includes the Singapore Business Federation, Temasek unit Heliconia Capital Management; MSIG Insurance, a subsidiary of Mitsui Sumitomo Insurance; and property giant Far East Organisation.

Last year, Singtel Telecommunications also announced that it would apply for a digital banking licence in Singapore through a partnership with Southeast Asian ride-hailing startup Grab. According to media reports, Singtel would hold a 40 percent stake in the consortium, while the remaining 60 percent would be held by Grab.

In June 2019, the Monetary Authority of Singapore first announced that it will issue two digital banking licences and three digital wholesale banking licences.

The apex bank is expected to announce the name of the successful applicants in June 2020.

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Enigma Group is the fifth to bid for a digital bank licence in Singapore.  Others include Grab-Singtel, Shopee parent Sea and the Beyond consortium. 

Enigma’s consortium includes Singapore-based companies Qrypt Technologies, 2359 Media and Blockchain Worx. Enigma Global Holdings are also a part of the consortium. 

The consortium’s proposed digital bank is focused on the underbanked small and medium enterprises in the city-state. Samuel Heng, chairman of the Enigma consortium, and a director at Enigma Global, said in a statement, “The experience from our financial services operations and footprint in Europe will help us leverage leading-edge technology and best practices from similar mature markets to address digital banking needs back home in Singapore too.” 

Applicants for the digital bank licence will need to be Singaporean-controlled. Also, they are expected to have a capital requirement of  $100 million, with foreign enterprises allowed to acquire a controlling stake. The winners of Singapore’s digital bank licence will be announced in mid-June. 

Last week, the Monetary Authority of Singapore announced that it has received 21 digital bank applications. Of the applications, wholesale licence applicants were 14 and full digital bank licence applicants were seven. 

Singapore’s digital wholesale banking licence bid has received applications from Chinese financial and technology majors such as Ant Financial, TikTok-owner ByteDance, and Xiaomi Finance, the media reports said. 

Southeast Asia’s digital lending market is anticipated to grow from $23 billion in 2019 to $110 billion by 2025, according to data from Google, Temasek, and Bain. 

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According to UOB, 60 percent of Asean population are under the age group of 35 years. Also, more than 70 percent of Asean consumers show significant ecommerce engagement.

The millennial generation will be the bank’s chief clients in the future. It aims to understand the needs of the digital-savvy population. UOB has studied millennials through ethnographic research in order to understand the market in the digital bank space. The bank even partnered with fintech firms Personetics and Meniga to boost customer engagement.

TMRW was launched in Thailand to help Asean’s digital generation enhance their banking experience. Its unique business model is highly customer-centric.

In UOB’s view, TMRW is the first digital bank in the world to enable a call function within its digital chat service. The chatbot has capabilities to recall old conversations with customers.

TMRW’s other prospective markets will include Indonesia, Singapore, Malaysia and Vietnam comprising a customer base of between three million and five million users in the next five years, a media report said.

Dr Dennis Khoo, head of group retail digital at UOB, told the media that, “Having a mobile-only digital bank enables us to explore new frontiers when it comes to designing a user interface based on customers’ banking behaviour and needs and to be sensitive to the nuances of each market.”

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Tonik is based in Singapore. Its subsidiary Tonik Digital Bank was granted regulatory approval to operate a digital-only bank in the Philippines, the reports said. 

The startup was seed funded and established by Forum, a French fintech developer. The Philippines  is primed for a digital banking evolution. Currently, 70 percent of the adult population in the country remains unbanked. Filipinos with an average age group of 24 years represent the world’s largest market in daily internet and social media consumption.

Only two virtual banks CIMB Bank and ING Bank currently operate in the Philippines, the reports said. Greg Krasnov, founder and CEO of Tonik, said in a press release, “Digital only banks globally have successfully demonstrated their ability to take massive market share by launching hyper-compelling consumer propositions, while also operating at disruptively low unit costs, and thus generating outstanding returns on assets and equity.” 

Also, the startup is tapping into the $140 billion retail deposit and $100 billion unsecured retail lending opportunities in the Philippines, according to the company website. 

Tonik offers retail financial products, such as deposits, loans, current accounts, payments and cards on a digital platform. The startup has built more than 30 digital and retail banks in emerging markets. 

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