- In PYMNTS’ July 2021 survey BNPL’s ability to spread payments over time and its ease of use were the most cited reasons for choosing the method, regardless of the consumers’ level of financial inclusion. Consumers with blemished credit or challenging credit histories see BNPL to improve overall credit health and scores specifically, a fact that is amply supported by the findings. 51 percent of consumers who have used or would use installments think BNPL “will allow them to improve their credit scores. This rate is higher for financially underserved consumers (57 percent and 69 percent of second-chance and shut-out consumers, respectively).” Additionally, 77 percent of consumers with little credit or damaged credit now see BNPL “as an option that improves their ability to buy things that they want without overspending.”
- Among the three BNPL personas identified in the new research — the financially stable “worry-free,” nearly one-quarter (23 percent) of “second-chance” consumers with blemished credit, and “shut-out” consumers typically living paycheck to paycheck and struggling with bills — BNPL is seen as an alternative to credit cards they either can’t access or can’t afford. Many consumers cite a fear of overspending. Card fees and interest rates are top reasons people in all personas avoid traditional credit cards. 40 percent of worry-free consumers who did not have a credit card in the last 12 months reported that they did not want to use credit cards because the cards encouraged them to spend money,” per the study.
- Shopify is now allowing merchants on its platform to sell NFTs directly to their customers. Before Shopify’s move, its merchants would have to sell NFTs through a third-party marketplace, forcing them to relinquish control of the sale and the customer relationship. One of the first Shopify merchants to offer NFTs will be the NBA’s Chicago Bulls, which launched an NFT “Legacy Collection” featuring the franchise’s six world championship rings.
Growth is accelerating: SoFi is currently the only company with an A-to-Z offering within a single app, which sets it apart from traditional banks and other fintech competitors such as Square and PayPal. SoFi’s strong reputation in the student loan category attracts users who then pick up other financial products across the app. As of the first quarter of 2021, SoFi has a total of 2.28 million members, up 110% year over year, and it was the company’s seventh consecutive quarter of accelerating user growth. The number of products used on SoFi’s app grew 273% year over year in the first quarter, indicating that members are starting to use more products across the app after joining.
A bank charter could improve profitability: SoFi and other fintechs don’t have branches and overhead like traditional banks, so digital banks have much lower customer acquisition costs. On average, a traditional bank pays between $1,500 to $2,000 to acquire a retail banking customer. In comparison, SoFi pays just $40 on average due to its digital presence and ability to cross-sell products to users from within its app. Galileo makes SoFi diverse: Galileo is best thought of as a “toll road” that benefits from the growth of the overall fintech space, which SoFi now benefits from. Galileo is growing rapidly, with year-over-year account gains of between 130% to 135% over each of the past three quarters. It now has 70 million accounts, growing almost fourfold from just two years ago. It currently contributes roughly 20% of SoFi’s total revenue, giving investors both diversification and exposure to the broader fintech industry.
- Maslife, the payment and wellbeing platform that rewards people for keeping healthy, has collaborated with regulated e-money services provider Paynetics to power its new financial wellbeing app. The new Maslife platform enables users to make informed decisions about their lifestyle, wellbeing, and finances. It offers customers a full suite of financial tools to support them in better managing their finances and improving their state of mind. The new app helps its users to implement positive habits and mindsets with actionable steps. These include mindful spending and budgeting with accounts in GBP, EUR and USD, free currency exchanges, virtual and metal debit cards, along with other payment services. Physical and mental health is supported within the app with health activity monitoring, guided meditation, informative podcasts, and much more. There are many financial, health, and mindfulness apps on the market, but none that bring together these priority areas of life in an integrated way.
- BaaS API platform Treasury Prime has announced customizable card controls including the ability for fintechs and other customers to put themselves in the authorization loop for approving their users’ transactions in real time. These enhanced card controls will give customers the ability to customize balance, merchant, and velocity limits based on their business model and proprietary user data in order to enable both more and larger transactions while reducing declined transactions and fraud. Treasury Prime customers who want to launch quickly with a minimum of customization can build their card programs using Treasury Prime’s best practices and pre-built settings and then customize in the future as they collect user data.
- Customers who are ready to begin customizing controls can use simple API calls to configure their card controls program together in any way that makes sense for their business. Many fintechs have their own data sources that address their particular end-users; in these cases it may be valuable for the company to be directly in the authorization loop because the fintech’s own data may better inform whether a transaction should be approved or denied. Treasury Prime’s card controls also makes cross financial product card controls feasible. Unlike other BaaS providers who force companies into pre-defined and structured flows, the Treasury Prime platform was built to support complex business models and flows of funds.
- Investment banking giant Goldman Sachs has filed an application with the U.S. Securities and Exchange Comission (SEC) for an exchange-traded fund (ETF) that would offer exposure to public companies in decentralized finance and blockchain around the globe. the fund would invest at least 80% of its assets into companies that advance blockchain technology and the digitization of finance. The Goldman Sachs Innovate DeFi and Blockchain Equity ETF (the ‘Fund’) seeks to provide investment results that closely correspond, before fees and expenses, to the performance of the Solactive Decentralized Finance and Blockchain Index (the ‘Index’),”. The markets that Goldman would be picking from would include Australia, Canada, France, Germany, Hong Kong, Japan, South Korea, Switzerland, the Netherlands, the United Kingdom and the United States.