Fintechs across various industries are exploring ways on how to pick off high value segment incumbents, with increasingly well-funded blockchain projects. The threats and opportunities that arise out of disruptive fintech firms are seeking to get in on the action, which has led to the boom in the overall investment in the segment.

FinTechs across various industries are exploring ways in which to pickoff high value segments incumbents, with blockchain projects being increasingly well-funded. The threat and opportunities, created by disruptive FinTech firms has not been lost on market incumbents – with a whole host of actors, from consultancy firms, accelerators seeking to get in on the opportunity.The first half of 2018 saw the global value of investment in fintech hit $57.9 bn over the course of six months. The spike of value from the 875 VC,PE and M&A deals completed have managed to exceed last year’s annual total.

The KPMG research that showed that the UK topped the US in terms of investment in the first hald of 2018, will be something that will be a major part of the country’s Brexit strategy—as it bids to make itself attractive to investment. Especially, to avoid any economic slumps as it begins post- EU life in 2019. To that end, Big Four firm’s ‘Pulse of Fintech’ report found that the UK also topped Europe for fintech investment overall—accounting for more than half of the total investment—which stood at $26 bn.

The UK attracted $16.1 bn (£12.3 bn) to its shores in the first half of 2018, almost $ 2 bn more than the US’ $14.2 bn haul. This was thanks to four of Europe’s top ten deals taking place in the UK. Vantiv’s $12.9 bn acquisition of Worldpay was the UK’s largest fintech investment addition during 2018’s first half, while digital banking firm Revolut ($250 mn), peer-to-peer finance firm Flender ($60 mn) and wealth management firm Moneyfarm ($54 mn) also completed some of the continent’s biggest fintech deals.

Commenting on the figures, KPMG FinTech Global Co-Lead Anton Ruddenklau said that 2018 had seen the fintech poised firmly on the front foot, as banks and financial entities look to save on operational costs and boost customer service offerings.

“In addition to the bullish levels of investment the UK has attracted, our fintech sector has also benefited from the UK Government’s continued support with the launch of the fintech sector strategy.” He explained.

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Billon refers to itself as a  “civilized blockchain” company– meaning that it implements blockchain to ultimately process fiat currencies. FIS is an Florida-based international company that has more than 55,000 employees located across 130 countries and beyond, specializing in banking software and payment processing.

FIS will be collaborating with Billon to assess the use of Billion’s “distributed architecture for document and identity management” for the FIS international fintech suite and “explore joint product development and sales opportunities for its portfolio of corporate blockchain solutions.”

Billon and FIS will also evaluate the potential to work together on corporate and SME payments—as well as micropayments for smartphones and other digital devices, according to the press release.

Earlier this spring, Billon had also partnered with the Polish Credit Office (BIK), the largest credit bureau in Central Europe—in order to integrate blockchain tech for customer data storage.

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Nigel Green

April 5, 2016: The allegations made in the Panama Papers case are not representative of the international financial services industry.

Regards the leak of confidential documents from Panamanian law firm Mossack Fonseca, like many people, I have found the details of the Panama Papers case, outlined in the BBC Panorama programme, very concerning as it suggests there might have been tax evasion on a grand scale. Clearly, tax evasion is illegal and punishable by law. It is a serious criminal global issue that needs to be tackled with more vigour.

However, I do not believe that the Panama Papers allegations are representative of today’s wider international financial services industry.

The overwhelming majority of the offshore sector only provides services that are fully compliant and legal and they are used by law-abiding clients, who are simply looking for typically better returns, more investment options and greater flexibility.

Many of the documents that have been revealed by the Panama Papers case date back decades and for the last several years, a new and totally unprecedented era of transparency and disclosure has been ushered in.

Indeed, the idea of a ‘tax haven’, in the traditional sense of the phrase, is now somewhat outdated.  In today’s world, in which financial information is being automatically exchanged with tax authorities globally, it is almost impossible to hide money. No longer can people stash assets on ‘treasure islands’ and not expect to be caught.”

The international financial services industry plays a vital and largely positive role in the global economy.  Yet, this is typically overlooked by the media.

As the press is quick to point out, there are many questionable reasons why people might want to keep money in an offshore account, which is simply an account in a jurisdiction different to the one in which the person currently lives.

However, in my experience of working with expatriates and international investors, who have generally more transient lifestyles, offshore accounts are preferable simply for convenience. They offer centralised, safe, flexible and international access to their funds no matter where they live and no matter to which country the individual moves to in the future. In addition, they offer a wide choice of multicurrency savings and investment solutions.

Offshore financial centres allow those who qualify to do so to use legal, bona fide international investment products to form part of a robust and sensible financial planning strategy.

Other major advantages of such centres include that they allow companies to avoid getting taxed twice on the same income and that they offer legitimate financial refuge for those in countries where there is economic and political turmoil, such as extremely volatile currency and confiscation of assets.

Whilst most international financial centres are now well regulated, transparent and cooperative, and provide a much needed and in-demand service for people and firms all over the world, the Panama Papers claims underscores that more can still be done.

Indeed, this should act as an opportunity to further enhance the effectiveness and credibility of these international financial centres and the sector. This is especially important as the industry is set to grow exponentially in the coming years as individuals and companies become ever more globalised.

Nigel Green is the founder and chief executive of deVere Group

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IFM Correspondent

January 2, 2017: The year 2016 was filled with action. The Official Monetary and Financial Institutions Forum (OMFIF), a research firm, expects 2017 to be along the same lines. Many lines of political and economic risk intersect the US, China and Donald Trump’s incoming administration. According to OMFIF, there is a spike in US bond market yields and heightened financial volatility disturbing global markets while Trump’s ‘wayward behaviour and rhetoric’ will exacerbate the damage in geopolitics and economics.

OMFIF expects wavering stability in China. Tension between Washington and Beijing could take various forms, ranging from disagreement in the UN Security Council to trade tariffs and even to an armed conflict. Trump’s economic policies will spur major reform in the US tax code and more Federal Reserve tightening. They could also provoke a trade war with China.

There will be challenges in the Middle East, Russia and Europe. OMFIF is anticipating a fallout between US and Iran over the nuclear deal. Also, a deal between Trump and Russian President Vladimir Putin could increase Russian influence in Syria and Eastern Europe.

Domestic forces, too, could cause instability in Europe. Elections are due in Germany, France and the Netherlands, as well as possibly in Italy – the four biggest euro area economies and founding members of the European Community. They will confirm global political influences already visible in Britain’s decision to leave the European Union as well as the Trump victory. Here, immigration will be a key factor. OMFIF thinks that Angela Merkel will most likely remain chancellor after the autumn poll, though no politician in Germany will be a clear winner.

Other elections could enter the narrative. Greece’s prime minister may gamble on a new poll, even though he may lose while the success of Italy’s new government is far from secured but the economy is fundamentally resilient.

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