The Weekly Wrap: all you need to know by Friday COB | March 11th

By Puja Sharma

The Weekly Wrap is published every Friday and recaps the week’s main stories and deals, as well as upcoming events and announcements. For Prime subscribers only.

The Big Story

Following Russia’s invasion of Ukraine this week, UK FinTech company Wise has restricted money transfers to Russia. The company, formerly known as TransferWise, told UKTN that it is also capping transfers on its platform to Ukraine so it can continue to operate there. Volodymyr Zelenskyy, the President of Ukraine, said that Russia has launched strikes against Ukraine’s military infrastructure and sent tanks across the border.

The UK, US, EU, Japan, Australia, and others have ramped up sanctions against Russia, including financial sanctions against its banks and individuals.

FinTechs and Banks Beware: Here Come the Sanctions and here’s what one can learn from the previous OFAC actions that affect FinTech companies: The U.S. reacted swiftly to Russia’s invasion of Ukraine last week, beginning with President Biden’s Executive Order 14024 (“The EO”) and then the Office of Foreign Asset Control (“OFAC”) announcing severe restrictions on Russian-related economic activity.

The OFAC encourages regulated entities to avoid procedures that would allow transactions to remain frozen during “pending” investigations.

U.S. financial institutions and FinTech companies face significant regulatory risks due to these changes. In light of these new sanctions, a strong Bank Secrecy Act (“BSA”) compliance program, anti-money laundering (“AML”) compliance program, and OFAC sanctions program ought to be able to address them; however, controls around your third-party due diligence and FinTech partnership program oversight most likely did not anticipate such a large-scale change to the regulatory landscape with a developed country with extremely active payments, digital assets, and FinTech ecosystem.

Financial institutions and FinTech companies should review their BSA, AML, and OFAC screening policies and procedures immediately to ensure that these sanctions are implemented. Moreover, financial institutions will be able to gauge their (and their FinTech partners’) compliance management programs and their ability to quickly integrate these sanctions programs and deploy controls.

Deals of the week

• Atomic secures $40 million Series B funding to improve financial access for Americans
• Fintegra secures $30 million Credit Facility
• in3 secures $11.1 million Series A from Finch Capital and partners with Worldline for free BNPL services
• mmob announces the close of a £5 million seed round
• Kueski announces $1 billion loan transactions
• Noh raises $3 million to automate the digital age of splitting bills
• Detected announced raising £1.5 million in the 4th funding round

Events & Appointments

• MENA Islamic banking & finance summit ushering the age of Islamic financial inclusion. It is on  March 15-16 2022, held at Marriott Hotel Al Jaddaf, Dubai, UAE.

• Tech to succeed today. Vision to thrive tomorrow. See cutting-edge FinTech that financial institutions can deploy now. Hear from experts who can help you plan for a digital future and connect with people who can take your business to the next level. Held on March 22-23 2022 at Intercontinental O2, London, England.