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Modest fintech investment in China in H1’19, but still dominates top 10 deals ranking in Asia Pacific, according to KPMG’s Pulse of Fintech

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Fintech investment in China has got off to a modest start in 2019 following record levels of investment last year, according to the Pulse of Fintech H1’19, a bi-annual report on global fintech investment trends published by KPMG.

Investment into fintech companies in China (including VC, PE and M&A activity) amounted to US$2.5 billion across 32 deals in the first half of 2019, down from the US$16.3 billion across 77 deals seen in the first half of 2018. The lack of megadeals in the country was the main driver of the decline, which affected total investment into fintech across Asia Pacific – dropping from US$18.3 billion across 256 deals in the first half of 2018 to US$3.6 billion across 102 deals in the first half of this year.

The fall in China and Asia reflected the wider trend globally, with US$37.9 billion invested into global fintech across 962 deals, falling from US$62.9 billion seen in the first half of 2018 across 1421 deals. This was also attributed to a pullback in mega deals.

Despite this, China still had a strong presence in the ranking of top 10 Asia Pacific fintech deals, taking four spots. NCF Wealth Holdings Limited’s US$2 billion merger with Hunter Maritime Acquisition Corp topped the deals in the region, followed by the US$100 million Series F financing for information services provider Shanghai Dianrong Financial Information Services, the US$94.8 million Series A financing for consumer finance firm Wiseco Technology, and crowd funding platform Shuidichou’s US$74 million Series B financing.

Fintech market maturing and evolving in China

Relatively quiet fintech investment activity in the first half of 2019 is in part a reflection of the significant maturation in China’s payment sector, following two years of ongoing investment and mega deals. Despite this, a number of less mature areas within fintech are rapidly growing, including microfinance and consumer finance.

At the technology level, China is also seeing significant interest in AI, cloud-solutions, big data and blockchain. Blockchain is expected to gain more attention from fintech investors, particularly in microfinancing. AI, big data and cloud services are also expected to remain attractive and Regtech is poised to see growing investment given the strong focus being given to it by China’s central government and provincial government authorities. As these burgeoning areas of fintech evolve and gain more traction, fintech investment in China is expected to rebound.

Tracy Zhang, Lead Partner and Head of Tax Transformation at KPMG China, said, “China’s fintech market is unique. Baidu, Alibaba and Tencent dominate and are making acquisitions to try to cover all the major sectors. We therefore expect the minority market to see more participation from small and medium-sized fintech players.”

Hong Kong pushes forward fintech market with virtual banking licenses

The Hong Kong Monetary Authority’s decision to issue its first batch of virtual banking licenses to eight companies represents a major stride in the development of fintech in the city. These companies reflect a diverse mix of non-traditional banking organizations, including insurance companies and telecoms, with several of China’s tech giants also represented in the first batch. Hong Kong will likely see increased investment both from traditional banks and non-traditional players looking to capitalise on the drive in virtual banking started this year.

The city’s innovation ecosystem also expanded during the first half of 2019, with digital start-up community Cyberport signing a deal with Ping An OneConnect to gain access to its Gamma API platform, which should spur innovation.

Avril Rae, Director and Head of Fintech at KPMG China, said, “The new Hong Kong virtual banking licenses are a very exciting development. As the virtual banks start to implement their strategies over the next year, we will see the major traditional banks strive to keep up in response. The expectation is that the virtual banks will be able to grow over time.”

 

SOURCE KPMG

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VersaPay Announces Dream Office REIT as Newest CRE Client

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VersaPay Corporation (TSXV: VPY) (“VersaPay”), a leading provider of cloud-based invoice-to-cash solutions including electronic invoice presentment and payment, automated accounts receivable, cash application and collections management, is pleased to announce that it has added Dream Office REIT (“Dream Office”) as its newest commercial real estate client.

“With our real estate portfolio expanding in Canada and the US, our objective is to enhance our tenants’ experience and provide them with a convenient web-based and mobile portal where they can access their account, retrieve invoices, communicate and make secure electronic payments,” stated Joanne Leitch, Vice President, Property and Operations Accounting at Dream Office. “We want to create efficiencies by eliminating manual processes, minimize errors and reduce the need for tenant account reconciliations. VersaPay offered the platform to make all of this possible.”

“Through our vendor selection process we searched for a company who could provide a platform with extensive functionality with whom we could partner to provide our tenants an improved experience. VersaPay provided what we were looking for in addition to a robust integration with our JD Edwards ERP to provide real-time AR and cash review,” stated Travis Vokey, Vice President and Head of Technology for Dream Office.

“We are so pleased to be working with Dream Office, a forward-thinking Commercial Real Estate company located right here in Toronto,” said Craig O’Neill, CEO of VersaPay. “Dream is a leader in its industry, offering high-quality central business district office properties to an impressive list of tenants. One of the keys to its success has been providing tenants with a market leading experience in all facets of the business, and we’re delighted to extend this to their tenants’ experience in billing and payments.”

 

SOURCE VersaPay Corporation

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Xoom Rolls Out Domestic Money Transfer Services in the U.S.

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Xoom, PayPal’s international money transfer service, today rolled out the ability for customers to send money to recipients in the U.S. for the first time. Through strategic alliances with Walmart and Ria, Americans can now use Xoom to send money fast for cash pick-up typically in minutes at nearly 5,000 locations across the country*.

Xoom’s services potentially benefit more than 44 million foreign-born people in the U.S.1 who send remittances to family and friends in their home countries. With the introduction of domestic money transfer services, Xoom will now serve even more customers, including more than half of Americans who make domestic person-to-person (P2P) payments2. Using Xoom’s mobile app or website, consumers will have the ability to send money quickly and securely for cash pick-up at any Walmart or Ria-owned store in the U.S.

“Many of our customers in the U.S. already send money to loved ones in the country, and they usually prefer that the money is available right away,” shared Julian King, Xoom’s Vice President and General Manager. “This rollout reinforces our commitment to make money transfers fast, easy and affordable for everyone, whether they are at home or on-the-go.”

“At Ria, we are delighted to further consolidate our relationship with Xoom and Walmart,” said Juan Bianchi, CEO of Euronet’s Money Transfer Segment. “Our continued partnership is a fine example of how Ria’s technology can serve as an enabler between platforms, offering consumers and partners an added layer of security and compliance screening, in turn facilitating value creation within the Fintech ecosystem.”

Many consumers in the U.S. face personal, institutional and policy-related barriers to access the financial system. These underbanked consumers rely heavily on fringe financial service providers to conduct routine financial transactions and pay high fees in the process. With Xoom’s introduction of domestic transfers, Americans can send money at affordable rates for cash pick-up quickly at 4,684 Walmart stores and 175 Ria locations across the United States. For more information on store locations and eligible banks, visit xoom.com.

A pioneer in digital remittances, Xoom is a fast way to securely send money, pay bills and reload phones for loved ones in over 160 countries globally. These remittances serve as a lifeline for many people around the world and are used to pay for every day needs like utility bills, healthcare, and education costs, as well as emergencies. The largely cash-based system of sending money across borders is full of paperwork, high fees, standing in line and an ever-present uncertainty of when, and if, the money will arrive when it’s needed. By providing fast and more secure payment options for customers to seamlessly and securely send money across borders by going online or using a mobile device, PayPal and Xoom are helping to expand and improve the financial health of millions of people worldwide.

*Fees and Limitations apply

 

SOURCE PayPal, Inc.

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SpeakEasy Awarded Cultivation, Processing and Cannabis Sales Licence by Health Canada

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SpeakEasy Cannabis Club Ltd. (CSE: EASY) (Frankfurt: 39H) (“SpeakEasy” or the “Company“) is pleased to announce that it has received Health Canada’s coveted licence for cultivation, processing and medical sales. The Company, situated on 290 acres of fertile land in the Okanagan’s renowned Golden Mile, has demonstrated adherence to the industry’s rigorous compliance standards, and can now grow and provide its high quality, small-batch cannabis to the burgeoning recreational and medical markets.

With the receipt of the licences, the Company has immediately begun cultivation of cannabis in its 10,000-square-foot, purpose-built, state of the art facility. The Company has aquired an extensive library of unique genetics that will be used as starting material for the cultivation of cannabis at the facility.

SpeakEasy’s outdoor cultivation site has also been completed and stands ready to receive these genetics for the 2020 growing season. SpeakEasy plans to submit its evidence package for the outdoor field and amend its licence to allow outdoor cultivation on its 60 acre field. “Receiving our licence at long last, is a dream come true for all of us in the SpeakEasy family. The support we have received from shareholders, employees, family and friends has been overwhelming and I appreciate you all more than I can say,” says Marc Geen, founder of SpeakEasy. “When it comes to producing phenomenal craft cannabis, farms will always be superior to factories and culture will always speak louder than corporations. Real people recognize authenticity and SpeakEasy intends to lead by example, sharing the story of our people through the excellence of our product.” With the anticipation of receiving its outdoor licence, SpeakEasy is positioned to become one of the largest cannabis producers in Canada with extremely low cost per gram outdoor grown flower and extremely high quality small batch indoor flower.

SpeakEasy recently completed the transformation of a 60 acre orchard into a custom built outdoor cannabis cultivation environment. The fertile agricultural land is expected to enable the farm to produce up to approximately 70,000kg of cannabis flower and the Company plans to double the output to up to approximately 150,000kg, pending approval of its outdoor cultivation licence.

Construction commenced in the fall of 2017 on the 80,000-square-foot SpeakEasy campus in anticipation of demand for SpeakEasy’s craft cannabis flower and value added products. Buildings two and three were completed to lock-up in the second quarter of 2019 and building four, another 26,600-square-foot facility commenced in the spring of 2019 and is also at the lock-up stage of its development. The anticipated use of building four is the processing of sun grown outdoor flower and biomass for extraction. SpeakEasy has accumulated an impressive library of unique genetics from sources outside existing licence holders, empowering the Company to develop new strains, unique to SpeakEasy, for both indoor and outdoor cultivation.

SpeakEasy founders and team members are long standing advocates for the value of community and harnessing the power of combined expertise through successful farming cooperatives. SpeakEasy now plans to apply the same values for cannabis farming. SpeakEasy’s innovative business model is designed to support industry-leading talent through shared knowledge, resources and passion, with a commitment to maintaining exceptional quality standards and developing unique cannabis strains. The Company empowers experienced growers and geneticists to operate independently with the freedom to develop each cultivar to perfection.

 

SOURCE Speakeasy Cannabis Club Ltd.

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