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County-level city in East China becomes hot destination for German investment
BEIJING, April 19, 2024 /PRNewswire/ — A report from People’s Daily: The number of German companies in Taicang, east China’s Jiangsu province reached 500 as Beumer Group settled there earlier this year.
During the past three decades, Taicang has consistently seized business opportunities with the German companies based there and created an optimal business environment for them and its successes have been recognized by the authorities in both countries.
In November 2008, Taicang was named a “Sino-German Enterprise Cooperation Base” by China’s Ministry of Commerce and by Germany’s Federal Ministry for Economic Cooperation and Development and remains the only city to be recognized that way by both sides.
Why can this county-level city attract numerous German companies to settle and thrive there?
The sound business environment and professional services that Taicang offers are one of the secrets to the city’s appeal. “Meticulous government services” and “unimpeded communication between the government and enterprises” are the most frequently mentioned terms by German enterprises in Taicang when they speak of the city’s business climate.
Jan Assmann, general manager of the Taicang company of Bernstein, a leading supplier of industrial safety and enclosure technology from Germany, has been living in Taicang for nearly 20 years. He told People’s Daily that the government of Taicang has provided abundant favorable policies for German enterprises and the business environment there is getting better and better.
He believes German companies flocking to Taicang has created a cluster effect. For example, automotive parts manufacturers settling in the city have attracted machine tool manufacturers, which then attracted mold manufacturers. In this way, Taicang has gradually established an industrial chain and supply chain centered around automotive parts and machine tools, Assmann said.
The German Center Taicang was set up in the city in 2016, which provides one-stop business services for nearly 50 enterprises including those from Germany.
“We were attracted by Taicang’s excellent business environment and the professional services provided by the government,” said general manager of the center Marieke Bossek.
According to Bossek, Taicang High-tech Industrial Development Zone has assigned a service specialist to every German enterprise, who the enterprises can turn to for assistance whenever they encounter difficulties or challenges.
“This efficient service has left a deep impression on me,” she said.
In recent years, German companies in Taicang have strengthened their localization strategies, which not only advanced their own development, but also helped with the standardized and massive production of local enterprises. The rapid development of local suppliers has helped German companies reduce production costs and improve supply chain efficiency.
Chiron Group, a leading manufacturer of high-speed CNC machine tools, is considered an “hidden champion” in this industry. The group set up a factory in Taicang in 2012 and later moved its China headquarters to the city, said Willi Riester, chief technology officer of Chiron Machine Tool (Taicang) Co., Ltd.
“Our machine tools require extremely high precision, and it is essential to maintain close communication with both upstream and downstream customers. Thanks to the cluster effect of the China–Germany industrial parks in Taicang, the supply chain here is stable, allowing us to conveniently and swiftly obtain high-quality components,” Riester said.
Currently, over half of the German companies in Taicang place R&D locally, and over 90 percent of the early settlers have completed capital increases and expanded production. The average output value per mu (about 667 square meters) of German companies has reached 14 million yuan ($1.93 million).
At the end of 2023, the New Energy Phase II Factory of a manufacturing base of German manufacturer of rolling element bearings Schaeffler Group was officially inaugurated.
Matthias Zink, CEO Automotive Technologies of Schaeffler Group, noted that the group has expanded its investment in Taicang 13 times, which totaled over 11 billion yuan. Taicang has become one of the group’s largest manufacturing bases globally, Zink added.
Over the past 30 years of cooperation with Germany, the local government of Taicang has paid more and more emphasis to the exchange between Chinese and German cultures, providing a comfortable, well-built, and convenient business and living environment for German companies and their employees.
For instance, Taicang has built a Rothenburg Street, where German bakeries and restaurants can be found almost everywhere.
“The cityscape of Taicang is constantly improving, and the environment has become more beautiful,” Assmann said. “When I’m free, I often take a stroll with my family along the Haiyundi Road and the Rothenburg Street.”
Taicang also hosts events such as beer festivals, marathon races, Sino-German artist salons, and Sino-German table tennis tournaments on a regular basis. It has built service facilities like a Sino-German friendship kindergarten, attracting an increasing number of Germans to settle there.
A series of policies that China released recently have signaled the country’s determination to expand high-level opening-up. It has rolled out five new measures to simplify the process for foreign nationals seeking to visit China, revised the national version of negative list for foreign investment, and lifted all restrictions on foreign investment access to manufacturing.
It also put forward 24 specific measures to further optimize the foreign investment environment and intensify efforts to attract investment, and made continuous efforts to build a market-oriented and world-class business environment governed by a sound legal framework. These efforts are welcomed by German companies in China.
A recent report released by the German Institute for Economic Research showed that direct investment from Germany to China increased by 4.3 percent in 2023, reaching a record high of 11.9 billion euros ($12.79 billion).
Another report released by the German Chamber of Commerce in China earlier this year highlighted that over 90 percent of surveyed companies plan to continue their business operations in China, with 54 percent of them intending to increase their investments in the country.
“Since settling in Taicang in 2004, OASE has seen a continuous increase in actual investment,” said Shen Ya, general manager of Oase Living Water (Taicang) Co., Ltd.
“Over the past three years, our business has grown at an average annual speed of 30 percent. In the future, the group will continue to seize opportunities in China, increase investment in China, and deepen our presence in the Chinese market,” Shen added.
“China’s commitment to expanding high-level opening-up has strong appeal to foreign-invested enterprises. As global economic recovery remains sluggish, China’s economy has shown a positive growth momentum. We hope that more German companies can seize the opportunity and continue to invest in China,” Assmann said.
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The Basel Committee on Banking Supervision has recently released a comprehensive report detailing the increasing risks associated with the digitalisation of finance. As financial institutions worldwide embrace digital transformation to enhance efficiency and customer experience, the report underscores the need for vigilant risk management and regulatory oversight to address the emerging challenges in this rapidly evolving landscape.
Key Findings
The report identifies several key areas where digitalisation is contributing to heightened risks:
- Cybersecurity Threats: The proliferation of digital banking platforms and online financial services has led to a surge in cybersecurity threats. Cyberattacks, data breaches, and fraud are becoming more sophisticated, posing significant risks to both financial institutions and their customers. The Basel Committee emphasizes the importance of robust cybersecurity measures and continuous monitoring to safeguard sensitive financial data.
- Operational Risks: As banks and financial institutions integrate advanced technologies such as artificial intelligence, blockchain, and cloud computing, they face new operational risks. System failures, software bugs, and technology outages can disrupt services and lead to substantial financial losses. The report recommends that institutions develop comprehensive operational risk management frameworks to mitigate these risks.
- Regulatory Challenges: The rapid pace of digital innovation often outstrips existing regulatory frameworks, creating gaps that can be exploited. The Basel Committee calls for updated regulations that keep pace with technological advancements, ensuring that financial institutions operate within a secure and compliant environment. Harmonized global standards are essential to address the cross-border nature of digital finance.
- Third-Party Dependencies: Financial institutions increasingly rely on third-party service providers for critical functions such as cloud storage, payment processing, and cybersecurity solutions. This dependency introduces additional risks, including vendor lock-in and the potential for service disruptions. The report advises institutions to conduct thorough due diligence and implement robust third-party risk management practices.
- Consumer Protection: Digital finance has made financial services more accessible, but it also exposes consumers to new risks, such as digital fraud and identity theft. The Basel Committee highlights the need for stronger consumer protection mechanisms, including transparent communication, effective dispute resolution processes, and education initiatives to raise awareness about digital risks.
Recommendations
To address these rising risks, the Basel Committee offers several recommendations:
- Enhanced Cybersecurity Protocols: Financial institutions should invest in advanced cybersecurity technologies and adopt best practices to protect against cyber threats. Regular audits and stress testing of cybersecurity systems are crucial to ensure resilience.
- Operational Resilience: Developing and maintaining robust operational resilience frameworks is essential. This includes regular testing of disaster recovery and business continuity plans to minimize the impact of potential disruptions.
- Regulatory Innovation: Regulators need to innovate and adapt to the changing digital landscape. This involves updating existing regulations, fostering collaboration between regulators and the fintech industry, and developing new guidelines that address the unique risks of digital finance.
- Third-Party Risk Management: Financial institutions must implement rigorous third-party risk management policies, including comprehensive vendor assessments, ongoing monitoring, and contingency planning for critical service providers.
- Consumer Education and Protection: Enhancing consumer protection through education programs and transparent communication about digital risks is vital. Financial institutions should also offer robust support systems for customers affected by digital fraud or other issues.
Conclusion
The Basel Committee’s report serves as a critical reminder of the complexities and risks associated with the digitalisation of finance. While digital transformation brings numerous benefits, including greater efficiency and accessibility, it also introduces significant challenges that must be addressed proactively. By implementing the report’s recommendations, financial institutions and regulators can work together to create a secure, resilient, and inclusive digital financial ecosystem.
The post Basel Committee highlights rising risks from finance digitalisation in new report appeared first on HIPTHER Alerts.
Lydia, a prominent French fintech company known for its innovative financial solutions, has taken a significant leap forward with the launch of its new digital banking app, Sumeria. This development marks a strategic expansion for Lydia as it continues to redefine the financial landscape in Europe and beyond.
About Lydia
Since its inception, Lydia has been at the forefront of fintech innovation in France, providing users with seamless and user-friendly payment solutions. The company has built a strong reputation for its mobile payment app, which allows users to send and receive money, pay for goods and services, and manage their finances with ease. With millions of users and a robust platform, Lydia is well-positioned to venture into the digital banking space.
Introducing Sumeria
Sumeria is Lydia’s latest offering, designed to cater to the growing demand for comprehensive digital banking solutions. The app aims to provide users with a full suite of banking services, all accessible from their smartphones. Key features of Sumeria include:
- Personal and Business Accounts: Sumeria offers both personal and business accounts, enabling users to manage their finances efficiently. The app supports a range of functionalities tailored to meet the needs of individual users and small to medium-sized enterprises (SMEs).
- Intuitive Interface: True to Lydia’s commitment to user experience, Sumeria boasts an intuitive and easy-to-navigate interface. Users can quickly access account information, transaction history, and various banking services with just a few taps.
- Comprehensive Financial Tools: Sumeria provides a range of financial tools designed to help users better manage their money. Features such as budgeting, expense tracking, and personalized financial insights empower users to make informed financial decisions.
- Security and Privacy: Lydia places a high priority on security, and Sumeria is no exception. The app incorporates advanced security measures, including biometric authentication and end-to-end encryption, to ensure that users’ financial data is protected.
- Integrated Payments: Leveraging Lydia’s expertise in payments, Sumeria integrates seamless payment solutions, allowing users to send and receive money instantly, pay bills, and make purchases directly from the app.
Strategic Implications
The launch of Sumeria represents a strategic move for Lydia, positioning the company as a formidable player in the digital banking arena. By expanding its product offering, Lydia aims to capture a larger share of the market and meet the evolving needs of its users. This initiative also reflects a broader trend in the fintech industry, where traditional payment service providers are evolving into comprehensive financial service platforms.
Market Impact
Sumeria’s entry into the market is poised to have a significant impact. With its user-centric design and robust feature set, the app is likely to attract a diverse user base, from tech-savvy millennials to SMEs seeking efficient banking solutions. Moreover, Sumeria’s integration with Lydia’s existing payment infrastructure provides a seamless transition for current Lydia users, further boosting its adoption.
Future Prospects
Looking ahead, Lydia plans to continually enhance Sumeria by adding new features and expanding its services. The company’s focus on innovation and customer satisfaction will be key drivers of Sumeria’s growth. Additionally, Lydia’s potential to scale Sumeria across other European markets presents a substantial opportunity for further expansion.
Source: fintechfutures.com
The post French fintech Lydia launches digital banking app Sumeria appeared first on HIPTHER Alerts.
This week was dominated by earnings reports from fintech firms specializing in connecting supply and demand, such as those in lending and modernizing payments between merchants and consumers. Despite ongoing stock volatility, the FinTech IPO Index climbed 1.7%.
FinTech IPO Index Highlights
Katapult saw its stock soar by 18.5% this week. The company reported that Katapult Pay gross originations grew over 150% year-over-year to $55.6 million, with 55.9% of these originations in Q1 2024 coming from repeat customers. Total revenue increased by 18.1% to $65.1 million.
Blend Labs experienced a share increase of just over 15%. Their Q1 2024 earnings revealed total company revenue of $34.9 million, comprising $23.8 million from the Blend Platform segment and $11.1 million from the Title segment. Within the Blend Platform, mortgage suite revenue declined by 15% year-over-year to $15.1 million, while consumer banking suite revenue rose by 29% to $6.7 million. Professional services revenue increased by 21% to $2.1 million.
Paysafe saw a 15.2% rise in its stock. The company’s earnings report indicated an 11% increase in revenue from its Merchant Solutions segment, driven by strong eCommerce performance and SMB client demand. Digital wallet-related revenue increased by 5%, mainly due to growth in the gambling sector. Overall, consolidated revenue rose by 7% to $418 million on a constant currency basis, with total payment volume up 7% to $36.1 billion, and transactions per active user increasing by 14%.
Open Lending shares climbed 7.8% following their partnership with Core Specialty Insurance Holdings, which will now provide credit default insurance policies for Open Lending’s Lenders Protection platform.
Robinhood saw a modest increase of 3.4% over the past week. The company exceeded Q1 profit expectations, driven by strong cryptocurrency trading volumes and a 22% rise in net interest revenue to $254 million. Retail traders, optimistic about economic prospects, have reentered the market, resulting in a 59% increase in transaction-based revenue.
Oportun shares rose by 2.7%. The company’s official Q1 report on May 9 confirmed preliminary results, showing aggregate originations of $338 million, down from $408 million last year. The portfolio yield was 32.5%, an increase of 113 basis points from the previous year, and the annualized net charge-off rate improved to 12% from 12.1% a year ago and 12.3% in the previous quarter.
Declines in the Index
dLocal experienced a significant decline, with shares dropping by 27%. Despite a 49% year-over-year increase in total payment volume to $5.3 billion and a 34% rise in revenue to $184.4 million, gross profit margins were pressured by renegotiated terms with a top merchant and higher payout volumes. Consequently, operating income fell by 32% year-over-year.
Nu Holdings reported the addition of 5.5 million customers in Q1, bringing its global total to 99.3 million by the end of March. The company, now the fourth-largest financial institution in Latin America by customer count, saw monthly average revenue per active customer grow by 30% year-over-year. However, its shares slipped by 0.6%. The NPL ratio for its Brazilian consumer credit portfolio was 5%, consistent with expectations and historical patterns.
Expensify added unlimited virtual cards to its spend management platform. The new Expensify Visa Commercial Card allows businesses to manage expenses across employees and merchants, setting fixed or monthly spending limits for each card. Despite this innovation, the company’s shares fell by 3.4%.
In summary, the fintech sector showcased a range of performances, with several companies delivering strong earnings that boosted the FinTech IPO Index, while others faced challenges that impacted their stock prices.
Source: pymnts.com
The post FinTech IPO Index Edges Up 1.7% as Katapult Earnings Lead Platforms Higher appeared first on HIPTHER Alerts.
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