Fintech
SEC Proposes Rules to Extend Regulations ATS and SCI to Treasuries and Other Government Securities Markets
Washington, D.C.–(Newsfile Corp. – September 28, 2020) – The Securities and Exchange Commission today announced a proposal to enhance the operational transparency, system integrity, and regulatory oversight for alternative trading systems (ATSs) that trade government securities as well as repurchase and reverse repurchase agreements on government securities (Government Securities ATSs) and issued a concept release soliciting public comment on the regulatory framework for electronic platforms that trade corporate debt and municipal securities.
“Today’s proposal is another fine example of the commitment of the Commission and the SEC staff to ensuring that the implementation of our time-tested regulatory framework keeps pace with market developments,” said Chairman Jay Clayton. “Government Securities ATSs have become important to the functioning of our U.S. Treasury markets and this proposal, which benefited from input from the Treasury Department, would extend our transparency- and systems integrity-enhancing rules—Regulations ATS and SCI—to those markets. I specifically want to thank Treasury staff and the many past and present senior Treasury officials for their insightful input and support for this effort. The related concept release, which grew out of a recommendation by the SEC’s Fixed Income Market Structure Advisory Committee, will also enhance our understanding of the fixed income electronic trading space, including informing future modernization efforts.”
The U.S. government securities markets are among the most liquid and significant securities markets in the world. Government securities, including U.S. Treasury securities and agency securities, make up more than half of the outstanding debt issuances in the U.S. bond market and play a critical role in the U.S. and global economies. Over the last six months of 2019, the average daily trading volume in government securities was approximately $835 billion.
Over the years, ATSs have become increasingly important to government securities trading. Under the proposal, all Government Securities ATSs would be required to comply with Regulation ATS. The proposal would apply the investor protections Regulation ATS provides to such entities, such as the requirement to adopt written safeguards and written procedures to protect confidential subscriber information, and enable Commission oversight, including surveillance and examination, of these ATSs. The proposal would also require an ATS with significant market share for U.S. Treasury securities or agency securities to provide fair access to trading on such ATS.
The proposal is also designed to increase transparency in the government securities markets by requiring Government Securities ATSs to file comprehensive public disclosures on new Form ATS-G. Among other things, Form ATS-G would inform market participants about potential conflicts of interests arising from trading activity of the ATS’s broker-dealer operator or its affiliates, and the ATS’s manner of operations, such as order types, use of market data offered and used by the ATS, and fees. The Commission would review Form ATS-G filings and have the ability to, after notice and opportunity for hearing, declare a Government Securities ATS’s Form ATS-G ineffective.
The Commission is also proposing to amend Regulation SCI to apply its provisions to ATSs that meet certain trading volume thresholds in U.S. Treasury securities or agency securities. Regulation SCI requires SCI entities to have policies and procedures that are reasonably designed to ensure that their automated systems have adequate levels of security, including regular reviews and testing of systems to identify vulnerabilities. The proposed amendments are intended to help to address technological vulnerabilities, and improve the Commission’s oversight of the core technology of key entities in the markets for government securities.
In addition, the Commission is issuing a concept release arising out of the recent work of the Fixed Income Market Structure Advisory Committee. The concept release focuses on the regulatory framework for electronic platforms that trade corporate debt and municipal securities, and the Commission is soliciting public comment to obtain information about fixed income electronic trading platforms, including their operations, services, fees, market data, and participants.
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FACT SHEET
Regulation of Government Securities ATSs:
Proposed Amendments to Regulation ATS and Regulation SCI
September 28, 2020
Current Regulatory Framework
Alternative trading systems (ATSs) are trading systems for securities that meet the definition of “exchange” under federal securities laws but are not required to register with the Commission as national securities exchanges if the ATSs comply with the conditions to an exemption provided under Regulation ATS. Today, ATSs that trade only U.S. government securities as defined under Section 3(a)(42) of the Exchange Act (government securities) and register as broker-dealers or are banks are exempt from exchange registration and are not required to comply with Regulation ATS. ATSs that trade both government securities and non-government debt securities (e.g., corporate bonds) are not subject to all the provisions of Regulation ATS, such as the heightened disclosure requirements under Rule 304 and the fair access requirements under Rule 301(b)(5) (Fair Access Rule), and are not subject to Regulation Systems Compliance and Integrity (Regulation SCI).
Regulation ATS Proposed Amendments for Government Securities ATSs
The proposed amendments to Regulation ATS are designed to enhance operational transparency and protections for investors for ATSs that trade government securities or repurchase and reverse repurchase agreements on government securities (Government Securities ATSs).
- Application of Regulation ATS to all Government Securities ATSs
The proposed amendments would eliminate the exemption from compliance with Regulation ATS for an ATS that limits its securities activities to government securities or repurchase and reverse repurchase agreements on government securities, and registers as a broker-dealer or is a bank. As a result of the proposal, the following conditions of the Regulation ATS exemption would apply to all Government Securities ATSs:
|
Relevant Conditions to the ATS Exemption |
Requirements for Government Securities ATSs |
|
Rule 301(b)(1) |
Register as a broker-dealer under Exchange Act Section 15 or a government securities broker or government securities dealer under Exchange Act Section 15C(a)(1)(A). |
|
Rule 301(b)(5) |
Comply with the Fair Access Rule under Rule 301(b)(5) if it meets a given threshold of trading in U.S. Treasury securities or in a debt security issued or guaranteed by a U.S. executive agency, as defined in 5 U.S.C. 105, or government-sponsored enterprise, as defined in 2 U.S.C. 622(8) (Agency Securities), as discussed in further detail below. |
|
Rule 301(b)(7) |
Cooperate with the Commission’s or an SRO’s inspection, examination, or investigation of the ATS or any of the ATS’s subscribers. |
|
Rules 301(b)(8), 302, and 303 |
Make, keep current, and preserve certain records in accordance with Rules 302 and 303. |
|
Rule 301(b)(9) |
Periodically report certain information about trading activities on Form ATS-R. |
|
Rule 301(b)(10) |
Adopt written safeguards and written procedures to protect subscriber confidential trading information and separate ATS functions from other broker-dealer functions, including principal and customer trading. |
|
Rule 301(b)(11) |
Not use in its name the word “exchange” or derivations of the word “exchange.” |
|
Rule 304 |
File and maintain public Form ATS-G, as discussed in further detail below. |
- Form ATS-G Disclosures and Commission Oversight
Form ATS-G would require a Government Securities ATS to publicly disclose on Form ATS-G information about its manner of operations and the ATS-related activities of the registered broker-dealer or government securities broker or dealer that operates the ATS (broker-dealer operator) and its affiliates, and is designed to allow market participants to assess conflict of interest and understand how their orders will interact, match, and execute in the ATS.
Specifically, Form ATS-G would require a Government Securities ATS to disclose information regarding:
- Its broker-dealer operator, including identifying information and ownership.
- ATS-related activities of its broker-dealer operator, and the broker-dealer operator’s affiliates, including:
- the trading activities of the broker-dealer operator and its affiliates on the ATS;
- whether subscribers to the ATS can opt out from interacting with orders and trading interest of the broker-dealer operator and its affiliates;
- arrangements between the broker-dealer operator or its affiliates and other trading venues to access the ATS services;
- products and services offered to ATS subscribers by the broker-dealer operator and its affiliates;
- the activities of service providers to the broker-dealer operator and its affiliates; and
- written safeguards and written procedures established to protect the confidential trading information of subscribers.
- The manner of operations of the Government Securities ATS, including:
- types of subscribers, the criteria for eligibility for ATS services, and conditions for excluding subscribers from ATS services;
- means of entry for orders and trading interest;
- connectivity and co-location procedures;
- order types, attributes, and order size requirements and procedures;
- use of and conditions governing indications of interest;
- hours of operations, opening, reopening, and closing processes, and procedures for trading outside of the ATS’s regular trading hours;
- trading services, facilities, and rules of the ATS;
- arrangements with any subscriber or the broker-dealer operator to provide liquidity;
- segmentation of orders and trading interest and the provision of notice regarding segmentation;
- counter-party selection;
- display of orders and other trading interest;
- functionalities or procedures to facilitate trading on, or source pricing for, the ATS using markets for financial instruments related to government securities;
- fees;
- procedures for stopping or suspending trading;
- procedures regarding trade reporting, clearance, and settlement;
- sources and uses of market data; and
- aggregate platform-wide order flow and execution statistics provided by the ATS to one or more subscribers.
The proposed rules would also provide a process for the Commission to review Form ATS-G filings and, after notice and opportunity for hearing, declare Form ATS-G filings ineffective. The proposed process is the same as the Commission’s process for the filing and review of Form ATS-N, with a modification to the circumstances under which the Commission could extend the review period for Form ATS-G and Form ATS-N.
The Commission would make public a Government Securities ATS’s Form ATS-G when it becomes effective, as well as amendments to an effective Form ATS-G. A Government Securities ATS would be required to file amendments, including material amendments, to its Form ATS-G. As proposed, material amendments must be filed 30 calendar days prior to the implementation of the change and are made public upon the expiration of the 30 calendar day Commission review period, although a brief summary of the change will be made public upon filing.
In addition, each Government Securities ATS would be required to post on its website the most recently disseminated Form ATS-G, except for any amendment that the Commission has declared ineffective or that has been withdrawn.
- Fair Access Rule
The Commission also proposed to amend Regulation ATS to apply the Fair Access Rule to Government Securities ATSs that, during at least four of the preceding six calendar months, had (1) with respect to U.S. Treasury securities, five percent or more of the average weekly dollar volume traded in the U.S. as provided by the self-regulatory organization (SRO) to which such transactions are reported or (2) with respect to Agency Securities, five percent or more of the average daily dollar volume traded in the U.S. as provided by the SRO to which such transactions are reported. The proposed amendment to the Fair Access Rule would help ensure the fair treatment of potential and current subscribers to Government Securities ATSs that consist of a large percentage of trading volume in government securities.
Proposed Regulation SCI Amendments for Government Securities ATSs
The Commission proposed to amend Regulation SCI to expand the definition of “SCI alternative trading system” to include Government Securities ATSs that, during at least four of the preceding six calendar months, had (1) with respect to U.S. Treasury securities, five percent or more of the average weekly dollar volume traded in the U.S. as provided by the SRO to which such transactions are reported or (2) with respect to Agency Securities, five percent or more of the average daily dollar volume traded in the U.S. as provided by the SRO to which such transactions are reported. A Government Securities ATS that meets the proposed amended definition of “SCI alternative trading system” would fall within the definition of “SCI entity” and, as a result, would be subject to the requirements of Regulation SCI. The amendments to Regulation SCI would help to address the technological vulnerabilities, and improve the Commission’s oversight, of the core technology of key entities in the markets for government securities.
Regulation ATS Amendments for NMS Stock ATSs and ATSs that Trade Other Securities
The Commission proposed to amend Regulation ATS to:
- Require that Form ATS and Form ATS-R be filed with the Commission electronically through EDGAR and modernize both forms;
- Eliminate confidential treatment of the types of securities that an ATS trades as disclosed on the ATS’s Form ATS and Form ATS-R;
- Update and correct Form ATS-N;
- Require NMS Stock ATSs to post on their websites the most recently disseminated Form ATS-N, except for any amendment that the Commission has declared ineffective or that has been withdrawn; and
- Remove the exclusion from compliance with the Fair Access Rule and Rule 301(b)(6) under Regulation ATS for an ATS that matches non-displayed customer orders using prices disseminated by an effective transaction reporting plan.
What’s Next?
The proposal will be published on the Commission’s website and in the Federal Register. There will be a 60-day comment period following publication in the Federal Register.
The Commission will also consider comments on the concept release on the regulatory framework for electronic platforms that trade corporate bonds and municipal securities.
In the fast-paced world of financial technology, shifts occur daily as companies strive for innovation, customer satisfaction, and enhanced market reach. Today’s briefing covers a spectrum of developments, from Visa Direct’s groundbreaking integration in Korea to challenges plaguing the app economy. We’ll also touch on recent acquisitions, strategic partnerships, and expansions in fintech ecosystems. Here’s what you need to know about today’s most pressing fintech trends.
Visa Direct’s Milestone in South Korea: SentBe’s Card Transfer Service Launch
South Korea’s fintech ecosystem has taken a notable leap forward with SentBe’s implementation of Visa Direct’s Card Transfer Service. This collaboration marks a milestone, positioning SentBe as the first Korean fintech company to offer card-to-card international money transfers, a feature in high demand given the rise in cross-border financial activities. Visa Direct’s real-time card-to-card transfers are a potential game-changer for consumers and businesses alike, facilitating faster and more secure global transactions.
The collaboration exemplifies Visa’s larger strategy of partnering with regional fintech players to broaden its influence across Asia’s dynamic fintech markets. By tapping into SentBe’s growing customer base and extensive user insights, Visa is embedding itself deeper into local markets, simultaneously offering Korean users a more streamlined and efficient money transfer experience.
The service’s design allows individuals and small businesses alike to benefit from quicker transaction processing times, marking a significant evolution from traditional remittance processes that rely on intermediary banks. The move is especially critical in a digital age where customer expectations lean heavily towards instant, seamless financial interactions.
Source: Electronic Payments International
Fintech App ‘Trap’ Enrages Consumers Struggling to Cancel Subscriptions
In the modern subscription-based economy, some fintech companies are facing backlash over what customers perceive as the ‘trap’ of endlessly renewable subscriptions that are nearly impossible to cancel. A recent expose revealed mounting frustrations among consumers who signed up for digital services but later found themselves locked into subscriptions they could not easily terminate. The piece highlights the darker side of user retention strategies deployed by some companies to mitigate churn by making cancellation processes intentionally convoluted.
The app-based economy relies on recurring revenue, which remains a vital lifeline for startups and established firms alike. However, industry insiders argue that lack of transparency and difficult cancellation processes have an adverse impact on customer trust, leading to a growing dissatisfaction that may ultimately backfire on these companies. As consumers grow more savvy, fintechs relying on these practices could risk higher attrition rates, regulatory scrutiny, and brand erosion.
This emerging issue has raised questions about ethical standards and customer-centric models in fintech. As competition intensifies, companies must balance growth with transparent practices that foster customer loyalty, rather than coercion.
Source: Forbes
Pinwheel and Terafina Partner to Streamline Omnichannel Customer Onboarding
Pinwheel, a fintech infrastructure company known for its payroll and income data connectivity solutions, recently announced a partnership with Terafina, a leader in omnichannel sales and service platforms for financial institutions. This collaboration aims to simplify and enhance the onboarding process for new customers, providing them with seamless experiences across multiple channels, whether online, mobile, or in-branch.
The partnership combines Pinwheel’s data integration capabilities with Terafina’s expertise in customer onboarding, allowing financial institutions to create more personalized and flexible account opening processes. With consumer expectations evolving towards instant service and mobile-first access, this integration empowers banks and credit unions to meet these needs by delivering cohesive and smooth digital onboarding journeys.
In an industry where customer acquisition and retention are increasingly dependent on first impressions, the significance of streamlined onboarding cannot be overstated. By improving access to real-time employment and income data, this partnership enhances user verification and compliance while also allowing institutions to better assess applicants’ creditworthiness, which is crucial in today’s lending environment.
Source: PR Newswire
nCino Acquires FullCircl in $135 Million Deal: Expanding the Scope of Relationship Management
Fintech giant nCino recently completed its acquisition of FullCircl, a move that underscores its ambition to broaden its reach in the financial services sector. FullCircl, known for its focus on customer relationship management (CRM) solutions tailored to financial institutions, brings a robust set of tools that will allow nCino to enhance its cloud-based banking platform. The acquisition, valued at $135 million, positions nCino as a stronger player in the relationship management space, especially crucial for institutions looking to build deep, long-term client relationships.
With this acquisition, nCino aims to expand its footprint in Europe and boost its offerings in the CRM space, providing banks and credit unions with innovative tools for client engagement and retention. The integration of FullCircl’s CRM capabilities will also support nCino’s existing portfolio, which includes loan origination and digital banking solutions, strengthening its position as a one-stop platform for financial institutions.
This acquisition is part of a growing trend of consolidation in the fintech sector, where larger firms acquire specialized players to fill critical service gaps and offer more comprehensive solutions. By building a holistic platform that spans multiple functionalities, nCino is better equipped to compete in the increasingly crowded digital banking software market.
Source: The Paypers
DriveWealth’s European Expansion: A Strategic Base in Lithuania
DriveWealth, a digital brokerage technology firm, has chosen Lithuania as the launchpad for its European operations. By establishing a base within Lithuania’s burgeoning fintech hub, DriveWealth is strategically positioning itself to tap into the European market, leveraging the country’s favorable regulatory environment and proximity to major EU economies.
The expansion is particularly significant given the increasing demand in Europe for retail investing platforms that provide accessible and affordable market entry. DriveWealth’s solutions enable digital brokers and financial platforms to offer customers fractional shares and real-time trading experiences, which have proven highly popular in markets like the U.S. This move aligns with DriveWealth’s long-term growth strategy and its commitment to democratizing access to investing across the globe.
Lithuania’s supportive regulatory framework and well-developed fintech infrastructure make it an ideal location for DriveWealth’s entry into Europe. The country’s fintech-friendly policies allow innovative financial service providers to set up and scale efficiently. DriveWealth’s presence in Lithuania not only adds to the growing cluster of fintech firms but also reinforces the country’s reputation as a rising fintech powerhouse within the EU.
Source: Finance Magnates
Key Takeaways and Strategic Insights
As seen from today’s top stories, several overarching themes shape the fintech landscape:
- Global Partnerships and Local Expansion: Visa’s collaboration with SentBe exemplifies how partnerships enable fintech firms to break into regional markets by addressing specific customer needs.
- Transparency in Subscription Models: The customer backlash against difficult-to-cancel fintech services raises concerns about the sustainability of current subscription models.
- Innovation in Customer Onboarding: Pinwheel and Terafina’s partnership highlights the importance of streamlined onboarding processes as a means to increase customer satisfaction and improve retention.
- Mergers and Acquisitions to Fill Service Gaps: nCino’s acquisition of FullCircl illustrates a broader trend of consolidation, where fintech companies acquire specialized players to broaden their product portfolios.
- Regional Hubs as Strategic Launch Pads: DriveWealth’s decision to establish a base in Lithuania underscores the importance of regional fintech hubs in providing a supportive environment for global expansion.
Today’s roundup underscores the adaptability of fintech companies as they navigate emerging challenges and opportunities. From addressing regional financial needs to innovating customer experience, fintech firms continue to redefine what it means to engage in modern finance. As the industry grows, so too does the necessity for ethical practices, robust infrastructure, and agile customer solutions. In this competitive environment, the companies that prioritize transparency, customer satisfaction, and strategic expansion will set the standard for the future of finance.
The post Fintech Pulse: Your Daily Industry Brief – Breaking Trends and Insights in Fintech appeared first on HIPTHER Alerts.
Fintech
Fintech Pulse: A Snapshot of Global Expansion, Regulatory Moves, and Transformative Tech in Fintech
In today’s fast-paced fintech ecosystem, the global narrative is pivoting towards integration, regulation, and technological advancement as new entrants aim for U.S. markets, emerging startups seek growth capital, and financial giants align with innovative trends. Here’s a breakdown of recent developments that underline the dynamism in fintech and the paths to profitability and compliance as technologies reshape financial services globally.
Singapore’s MAS Advocates for a Borderless Fintech Network
The Monetary Authority of Singapore (MAS) recently emphasized the importance of cross-border collaboration in the global fintech ecosystem, with chairman Ravi Menon outlining a vision for a seamless fintech network. This network would transcend geographic and regulatory boundaries, allowing Singapore and its fintech entities to engage in mutually beneficial partnerships worldwide. Menon highlighted that Singapore’s strategic geographic position and regulatory environment make it a natural hub for fintech collaborations that advance financial inclusion and foster innovation.
This call for a borderless approach underscores the need for interoperability among financial systems globally, particularly as digital payments and decentralized finance become increasingly prevalent. Singapore’s initiatives signal that regions with supportive fintech policies can potentially drive new growth avenues in the digital economy.
Source: Channel News Asia
Thredd’s McCarthy to Fintech Entrants: Be Sponsor-Bank Ready for the U.S. Market
Fintech firms eyeing the U.S. market face a challenging regulatory landscape. John McCarthy of Thredd advises that those looking to enter the U.S. market should prioritize establishing sponsor-bank partnerships. The U.S. regulatory framework mandates that fintech companies collaborate with sponsor banks to access the financial system, making this step a critical milestone for fintechs aiming to operate stateside.
McCarthy’s guidance highlights an increasingly common barrier for fintech companies: navigating complex regulatory requirements to gain a foothold in the lucrative U.S. financial sector. For many, this means rethinking business models to comply with financial regulations, even as they innovate. This approach has led several fintech firms to secure sponsorship deals with established banks, enabling them to deliver compliant financial services to U.S. consumers.
Source: PYMNTS
Spidr Fintech Lands Funding to Drive Growth with Wells Fargo Backing
Spidr, a rising fintech star, has successfully raised capital, attracting the attention of Wells Fargo and other financial institutions. The fresh funding will fuel Spidr’s ambitious expansion plans, further positioning it as a formidable player in the fintech space. This backing from Wells Fargo represents a trend where major financial institutions are investing in or partnering with fintech startups to gain a competitive edge and meet evolving consumer expectations.
For Spidr, the capital injection aligns with a robust strategy for market penetration, and it’s an opportunity to leverage Wells Fargo’s extensive network and resources. Spidr’s latest round of funding signifies that traditional banks are increasingly open to collaborations with fintech entities, a trend that is reshaping the financial services landscape as banks seek to stay competitive in the digital age.
Source: Charlotte Business Journal
Elphinstone’s Trikl: Innovating Digital Payments in MENA
Elphinstone, a digital payments startup based in MENA, is introducing its innovative solution, Trikl, aimed at transforming payments across the region. The startup’s recent developments underscore its commitment to creating accessible and user-friendly payment systems tailored for the MENA market’s unique dynamics. By addressing specific needs such as currency exchange complexities and local payment preferences, Trikl is positioning itself as a key player in the digital payments landscape.
Trikl’s approach is particularly noteworthy as it caters to the MENA market’s diverse consumer base and taps into the region’s growing appetite for digital financial services. This development represents a promising advancement in digital payment solutions, fostering greater financial inclusion and enabling smoother transactions across borders in MENA.
Source: Menabytes
Hong Kong Sets Rules on Responsible AI to Get Ahead of Disruptive Tech
Hong Kong has unveiled regulatory guidelines on responsible AI use, a proactive move that places it among the leading jurisdictions in AI governance. This development signals Hong Kong’s recognition of the transformative impact of AI on financial services, as it sets clear boundaries on how AI can be used responsibly in financial applications. With AI continuing to disrupt financial services, responsible usage is becoming a priority, particularly in regions where financial systems are heavily reliant on technology.
These guidelines aim to balance innovation with accountability, addressing concerns over data privacy, ethical considerations, and risk management. Hong Kong’s stance on AI regulation reflects its commitment to safeguarding both consumers and financial institutions, setting a high standard for other regions to emulate in terms of regulatory foresight.
Source: South China Morning Post
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The Changing Landscape of Global Fintech
The financial technology (fintech) industry continues to evolve at a rapid pace, making headlines worldwide. Today’s briefing dives into transformative moves and strategic shifts within fintech companies across diverse geographies. From innovative alliances to prominent executive appointments and ambitious expansions into banking, the industry is positioning itself for a future that intertwines financial inclusivity, regulatory compliance, and customer-centric technology. Let’s unpack these developments.
XTransfer’s Hong Kong Fintech Week Entry: Scaling Financial Access in China
XTransfer, a Shanghai-based cross-border financial services firm, has joined the Hong Kong Fintech Week to showcase its solutions, marking a significant milestone in its journey to bridge financial gaps for small and medium-sized enterprises (SMEs) in China. Founded in 2017, XTransfer addresses common barriers faced by Chinese SMEs in accessing international financial networks due to regulatory complexities. The firm’s platform facilitates smoother cross-border transactions by helping businesses navigate regulatory and compliance challenges seamlessly.
The strategic choice to participate in Hong Kong Fintech Week highlights XTransfer’s commitment to strengthening connections within the Asian financial hub. The firm seeks to tap into the region’s wealth of potential clients and partners, as Hong Kong continues to be a pivotal gateway for businesses engaging in cross-border trade with China. The move is also symbolic of the broader fintech community’s push to create inclusive and accessible financial networks, even amid evolving regulatory landscapes.
Source: XTransfer Joins Hong Kong Fintech Week to Expand Global Presence (Yahoo Finance)
Propelld’s New Chief Business Officer: Driving Growth and Product Innovation
Propelld, an Indian ed-finance company, recently appointed Manoj Shetty as its new Chief Business Officer (CBO), signaling a strong commitment to enhancing its market penetration and product offerings. Known for his extensive experience in fintech, particularly in business development and scaling, Shetty is expected to spearhead Propelld’s ambitions to bring tailored financing solutions to India’s education sector.
Propelld focuses on providing student loans and education financing to underserved sections of India, leveraging advanced data analytics to assess borrowers’ potential rather than conventional credit scores. Shetty’s addition to the leadership team suggests that Propelld aims to double down on its innovative data-driven model to better serve the unique financial needs within education.
As the industry grows more competitive, having a seasoned executive like Shetty could be instrumental for Propelld to fortify its unique value proposition. His track record indicates a capacity for handling the nuanced needs of financial services catering to niche markets, and he may well position Propelld to scale sustainably in the expanding ed-finance space.
Source: Propelld Names Manoj Shetty as Chief Business Officer (IBS Intelligence)
Solo Funds Faces Legal Hurdles: The Class-Action Lawsuit Dilemma
In a move that could impact peer-to-peer lending’s regulatory path, Solo Funds faces a class-action lawsuit, alleging that the company’s lending practices breached consumer protection laws. As a platform designed to offer emergency loans to consumers facing cash flow issues, Solo Funds charges “tips” rather than conventional interest rates, a tactic intended to circumvent traditional lending regulations. However, plaintiffs argue that these tips effectively function as disguised interest, making Solo Funds’ practices deceptive and exploitative.
This lawsuit is a critical test for the burgeoning peer-to-peer lending segment, which has grown immensely in recent years as consumers seek alternatives to traditional financial institutions. The outcome may force similar platforms to reassess how they balance operational flexibility with regulatory compliance, potentially reshaping the industry’s approach to short-term lending.
With growing scrutiny on fintech lending platforms, the legal proceedings could also open a wider debate on how fintech firms should transparently operate within the bounds of financial laws. If Solo Funds is found liable, it may prompt stricter regulatory frameworks, affecting peer-to-peer platforms that rely on nontraditional models to attract users.
Source: Lending Fintech Solo Funds Faces Class-Action Lawsuit (TechCrunch)
Slice’s Transformation: A Fintech Company’s Foray into Traditional Banking
India-based Slice, originally a credit-based fintech, has announced its transition into a full-fledged bank, allowing it to offer conventional banking services in addition to its credit solutions. By securing regulatory approval to operate as a bank, Slice aims to expand its product range and deepen its relationship with a fast-growing consumer base in India. This move exemplifies a larger trend of fintech firms seeking to bridge the gap between traditional banking and innovative financial services.
Slice’s venture into banking will also set an intriguing precedent for other fintech companies in India and beyond. The company has successfully carved a niche among young users with its simple, digital credit products. As a bank, it can now offer savings accounts, lending products, and other services, thus creating a one-stop platform that could enhance customer retention and lifetime value.
The expansion to full banking status raises questions about how effectively Slice will manage its dual roles as a fintech innovator and a traditional bank, especially in a market as large and complex as India’s. It also marks a pivot point in the narrative of fintech companies morphing into full-service financial institutions, a trend that is gaining traction globally.
Source: India Fintech Slice Expands to Become a Bank (TechCrunch)
FullCircl’s 2025 Identity Verification Report: Insights into Compliance Challenges
FullCircl, a leading regulatory technology provider, recently released its “2025 State of Identity Verification” report, shedding light on the evolving landscape of identity verification and the challenges businesses face in maintaining compliance. As financial crimes become more sophisticated, firms increasingly invest in identity verification tools to stay ahead. According to the report, over 75% of financial institutions rank identity verification as a critical priority, citing the surge in fraudulent activities as a prime concern.
The report also highlights an industry-wide push towards digital identity systems and the use of artificial intelligence in detecting fraud patterns. As regulatory demands tighten and compliance risks rise, firms are urged to adapt swiftly. FullCircl’s findings underscore a need for seamless, real-time verification solutions that do not compromise customer experience—a delicate balance to maintain as identity verification protocols become more stringent.
The insights from FullCircl’s report reveal a heightened industry focus on ensuring robust identity frameworks that foster trust without hindering the ease of digital transactions. This growing demand aligns with broader trends where digital trust is crucial in retaining customers and enhancing their satisfaction.
Source: FullCircl Releases 2025 State of Identity Verification Report (PR Newswire)
The post Fintech Pulse: Today’s Key Industry Developments, Appointments, and Regulatory Challenges appeared first on HIPTHER Alerts.
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