The Monday Roundup: what we are watching this week | July 3rd

By Puja Sharma

The Monday Roundup sets the scene for the week’s biggest news stories, industry deals, and upcoming events. For Prime subscribers only.

Upgrading payment services

📋The European Commission has put forward new proposals in a bid to modernise payment services across the continent, including upgrading the Payment Services Directive (PSD2) to PSD3 and enhancing the rules around financial data access.

According to EC, the proposals reflect the changes seen in the payment services market in recent years. It claims electronic payments in the EU have been on the rise and were greatly accelerated by the Covid-19 pandemic. With new providers entering the market, including the rise of open banking services, the EC said sophisticated kinds of fraud have also emerged.

“In response to these developments, today’s package seeks to ensure the EU’s financial sector is fit for purpose and capable of adapting to the ongoing digital transformation, and the risks and opportunities it presents – in particular for consumers,” the EC said in a statement.

🏧With strategic equity investments, Santander Corporate & Investment Banking (Santander CIB), a premier global bank for trade finance, has partnered with Komgo, a global network of multi-bank banks for trade finance.

The partnership’s primary purpose is to fast-track the digital transformation of trade finance. It unites the strengths of both organisations, blending Santander CIB’s global footprint and leadership in trade finance with Komgo’s advanced technology and extensive corporate client base.

Additionally, Santander CIB has become a shareholder of Komgo through a strategic equity investment. This move is anticipated to generate synergy between Santander CIB’s global reach and Komgo’s innovative technology and corporate clientele. Furthermore, Santander CIB will benefit from Komgo’s technology to improve its client-to-bank communication, while Komgo will expand its trade finance offering, having already grown through the acquisition of Global Trade Corporation (GTC) last year.

UK and EU’s financial partnership

🤝UK chancellor Jeremy Hunt has signed a long-awaited financial services cooperation agreement with the European commissioner for financial services, financial stability, and capital markets union Mairead McGuinness.

The news follows Hunt’s visit to Brussels to meet European commissioners, the first visit by a UK chancellor in over three years. The memorandum of understanding (MoU) aims to establish a “constructive, mutually beneficial relationship” between the UK and the EU in financial services and will help establish an “ongoing forum” to discuss voluntary regulatory cooperation on financial services issues.

Both sides will share information, work together towards meeting joint challenges and coordinate positions where appropriate on issues ahead of G7, G20, and other international meetings. “The UK and EU’s financial markets are deeply interconnected and building a constructive, voluntary relationship is of mutual benefit to us both,” said Jeremy Hunt, chancellor of the exchequer.

“This agreement with our European partners as sovereign equals builds on our arrangements with the US, Japan, and Singapore, helping to support the sector’s role as a global financial services hub.”

💰Silicon Valley Bank announced that it has provided a $50 million warehouse facility to Achieve, a personal finance provider.

Achieve provides personal loans to help with debt and cash flow, home equity lines of credit, financial tools, and education and has helped more than 1.5 million members resolve or consolidate over $17 billion in debt.

Provided by SVB’s national FinTech practice, the financing facility will support Achieve’s HELOC program, which is designed to help homeowners with unsecured debt manage high-interest rates by using a portion of their home’s available equity to consolidate their debt, lower their payments, and free up more available cash flow. Since Achieve Home Loans launched in 2019, HELOC borrowers have saved an average of almost $10,000 per year compared to their previous unsecured debt payments.

“Consumers are looking for options to help manage the impacts of high-interest rates and inflation while tapping into their existing home equity,” said Ralph L. Leung, Chief Financial Officer of Achieve. “Through our continued strong relationship with SVB, we look forward to being able to serve more everyday people with our differentiated HELOC program.”

What is the buzz

🏦Orange Group is in exclusive negotiations with BNP Paribas to take over its Orange Bank customers as it attempts to exit retail banking.

Orange Group’s board of directors has given the go-ahead to work out a partnership with BNP Paribas for Orange Bank’s two-million-strong customer portfolio in France and to develop financing solutions for mobile devices. The pair will also negotiate terms for a takeover of Orange Bank’s Spanish business.

The talks with BNP Paribas form part of Orange’s wider intention to progressively withdraw from the retail banking market in France and Spain following a strategic review of its banking business that was launched several months ago.

“The evolution of the banking market now leads us to guide the bank into a new phase,” said Christel Heydemann, Orange Group CEO, adding that its priority will be to provide support for all employees and customers and that the process will be carried out in “complete transparency”.

Launched in France in November 2017, Orange Bank offers all basic banking services to consumers, including cards, savings accounts, personal loans, insurance, and mobile payments through its app. It launched its Spanish operations in November 2019.