Ripple, Coinbase licensed in Singapore; Revolut under fire in the U.K.

By John Adams, Kate Fitzgerald, Bloomberg News

October 4, 2023 12:21 PM

Singapore's regulators grant payment licenses to Ripple and Coinbase, Stripe expands pay-by-bank in Africa, U.K. regulators pressure Revolut and more in this week's global financial news roundup.

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Ripple gets license from the Monetary Authority of Singapore

Blockchain and cryptocurrency technology firm Ripple has received a major payments institution license from the Monetary Authority of Singapore. The license, which follows an earlier in-principle approval, will enable Ripple to continue to provide digital payment token services in Singapore. More than 90% of Ripple's business is outside of the U.S., and Singapore is one of the company's fastest growing markets, the company said. Ripple established its Asia Pacific headquarters in Singapore in 2017, and has doubled its headcount in Singapore over the past year. "Under MAS' leadership, Singapore has developed into one of the leading fintech and digital asset hubs striking the balance between innovation, consumer protection and responsible growth," said Brad Garlinghouse, CEO of Ripple, in a release. Ripple has a rockier relationship with U.S. regulators, including a long dispute with the Securities and Exchange Commission over the regulatory status of the XRP token. —John Adams

Samyukta Lakshmi/Bloomberg News

… and Coinbase gets a green light too

MAS has also granted Coinbase's Singapore unit a major payment institution license, enabling the company to expand its blockchain payment services to individuals and institutions in Singapore. The company, which issues the USDC stablecoin and an expanding menu of financial services, earlier this year integrated Singapore's federated digital ID, called SingPass. Circle also debuted no-fee USDC purchases in Singapore. Coinbase has identified Singapore as a primary market for expansion, citing internal research that found 25% of Singaporeans consider crypto as the future of finance, with 32% saying they are current or past crypto owners. Coinbase, which is also facing litigation from the SEC, hopes to forge partnerships and sell its technology to the hundreds of Web3 companies that are headquartered or have operations in Singapore. —John Adams

Rafael Henrique

Revolut faces U.K. probe over suspicious accounts

The Financial Conduct Authority is investigating London-based challenger bank Revolut over a potential violation of red-flag financial crime regulations. The FCA is trying to find out if Revolut allowed about $2.05 million to be released from accounts that the National Crime Agency had tagged as suspicious, reports the Financial Times. The suspected fund releases occurred during July and August, according to the newspaper. Revolut reportedly disclosed the issue to the FCA, but said about $604,000 had been released instead of the higher amount from the NCA. Revolut, which did not provide comment for this story, is in the midst of applying for a banking license in the U.K. and an expansion into the U.S. —John Adams

Binance, MUFG to develop stablecoin in Japan

Binance has partnered with Mitsubishi UFJ Financial Group to build a stablecoin. The coin will be built on MUFG's Progmat Coin distributed ledger development platform as part of a Binance initiative to issue stablecoins backed by U.S. dollars, yen and euros by 2024. Binance is looking to gain share in the stablecoin market while the crypto firm is in a regulatory dispute with the Securities and Exchange Commission. The SEC sued Binance in June, alleging the crypto exchange violated securities laws by commingling users' funds and funneling the money to a European company that Binance founder Changpeng Zhao controlled. This enabled Binance's U.S. investors to trade on an unregulated crypto exchange, according to the SEC. Regulators in the Netherlands also fined Binance in 2022 for operating an unregistered crypto exchange. —John Adams

Lloyds Bank debuts federated digital ID

Lloyds Bank has followed its recent $13 million investment in digital identity firm Yoti by building an ID application that does not require supporting documentation or much data. The app enables consumers to share information via their phones such as name, birthdate or proof of age. The information will feed a digital identity network that links Lloyds to other digital IDs that Yoti supports. Yoti's users in the U.K. include the national postal service, convenience stores, bars, theaters and companies that provide proof of identity for apartment leases and criminal record checks. Lloyds' integration will create an interoperable ID between the bank and other organizations, which could reduce sign-in navigation and help Lloyds' open banking strategy. —John Adams

Stripe-owned Nigerian fintech launches pay-by-bank technology

Lagos, Nigeria-based Paystack, which provides API connections to streamline merchant payment acceptance online, is expanding to support in-store payments via virtual terminals as Nigeria's point-of-sale volume surges, TechCabal reports. The new product will enable merchants to accept payments via bank transfers in stores, restaurants and in the field via QR codes, bank cards and Apple Pay. Paystack, which launched in 2015, also operates in South Africa, Ghana and Kenya. Stripe acquired Paystack in 2020 for $200 million, after making an earlier investment in the firm with Visa, which recently upped its own African fintech investment. —Kate Fitzgerald

Miami-based remittance firm teams with African money-transfer specialist

Viamericas, a Miami-based global money transmitter with operations in Mexico, Colombia and the Philippines, has expanded its reach to key markets in Africa through a partnership with Ivory Coast-based money-transfer firm Kori Global Services. Viamericas now reaches Burkina Faso, Cameroon, Senegal, Benin, Togo, Mali, Congo, Gabon, Chad, Central African Republic and Equatorial Guinea through Kori's payout network of bank branches, post offices and retail outlets supporting cash pickup, bank deposit or mobile wallet deposit, according to a press release. Viamericas, founded in 1999, serves more than two million active customers with more than $9 billion in annual remittance volume. Kori, which launched in 2021, specializes in intra-African money transfers. —Kate Fitzgerald

Westpac integrates its subsidiaries' branches

Westpac Group has finished an IT project that enables branch interoperability among its brands, including Westpac, St. George, BankSA and Bank of Melbourne. Consumers who bank with any of these financial institutions can use branches at any of the other brands. It is part of an effort at Westpac group to improve access in rural and underserved areas while managing the cost of maintaining a branch network as more consumers use mobile banking and other digital channels. Westpac is also opening co-branded branches, with 80 such locations opening in the past two years. Overall, more than 1,600 bank branches closed in Australia between 2017 and 2022, according to News Australia, leading to new regulations that require banks to follow a protocol to protect cash in the event of branch closures. News Australia additionally reports that about 99% of bank transactions in Australia come through digital channels. —John Adams

CBA using gamification to boost kids money app

The Commonwealth Bank of Australia has added gamified learning to Kit, its youth-focused app. The games, called "money quests," were built internally and include customizable avatars, in-app guests and incentives designed to add knowledge of banking, budgeting and other fiscal concepts — including the ability for players to further customize their avatars based on reaching certain financial health goals. There are nudges that encourage kids to reach savings targets, as well as spotting fake emails, text messages and other scams. Like most youth banking apps, Kit features payments and savings products, transfers for gifts and allowances and parental controls. —John Adams

Brazil to cap credit card rates averaging 450% at 100%

Brazil's Senate approved legislation to limit the growth of credit card debt to 100% of its original amount, an attempt to cap interest rates that currently average nearly 450%. Lawmakers passed the bill by acclamation Monday, a day before the expiration of a provisional measure that included the cap. The lower house of Congress approved the bill in September, meaning it is now on track to become law.

Brazil's interest rates on revolving credit have skyrocketed to an average of almost 446%, their highest level since 2017, according to data compiled by the central bank. Household debt remains near record highs, with outstanding loans representing almost half of disposable income. About 28% of monthly wages is used to repay some sort of debt, from credit cards to mortgages. —Daniel Carvalho, Bloomberg News