U.K. cracks down on crypto marketing, Canada fintechs push for open banking

By John Adams, Kate Fitzgerald, Bloomberg News

October 11, 2023 11:42 AM

The Financial Conduct Authority issued 146 alerts on crypto asset marketing, multiple payment companies in Canada are trying to spur adoption of open banking, and more.

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U.K. sends out 146 crypto marketing warnings in one day

The Financial Conduct Authority's crypto asset promotion rules went into effect on Monday, and the agency had a busy day — issuing 146 alerts in 24 hours, with firms being given an opportunity to engage with the FCA to correct marketing before more formal steps are taken. The rules mandate that firms marketing cryptocurrencies or related assets must be authorized and registered with the FCA, or have their marketing programs approved by a firm that the FCA has authorized. The promotions must be "clear and not misleading" and labeled with risk warnings about the dangers of investing in cryptocurrency. "These changes bring crypto assets in line with other high-risk investments," the FCA said in a release. —John Adams

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Canadian tech firms lobby for open banking

A group of payment technology companies including Wise, Wealthsimple, Xero Canada, Borrowell and fintech industry lobbyist Fintechs Canada have started the Choose More campaign, which is pushing for open banking. Open banking refers to using data sharing to enable a single log in (usually a payment credential) to access financial and nonfinancial products from other companies. Adoption of open banking in Canada is relatively low, and there isn't a formal framework to govern open banking in Canada. The Choose More campaign is designed to pressure faster work on data portability regulations, while educating consumers about data sharing and real-time payments, which are also delayed in Canada. Small financial institutions and credit unions are also advocating for open banking in Canada. —John Adams

Fiserv joins Swift's partner program

Fiserv has joined the Swift Partner Program, allowing the bank technology seller to enable connectivity to Swift's application programming interfaces and support Swift's Global Payment Initiative. Swift's GPI lets parties track payments across different banks and countries through a single source — a capability that's considered a key cog in Swift's real-time and cross border payment strategy. Fiserv is attempting to make it easier for its financial institution clients to offer cross-border digital payments, or to set up digital payments in new countries. Like many bank technology firms, Fiserv is in the midst of expanding its ability to connect banks to real-time payment networks, which will require technology upgrades to support interoperability across borders. —John Adams

Western Union connects directly to Morocco for earthquake donations

Western Union has enabled consumers to send funds to the Moroccan government to support relief efforts for victims of the recent earthquake in Morocco. The firm will remove fees for transactions to a government fund. The fund is also open to consumers making payments to bank accounts for family members in the country. Other payment firms have waived fees or set up funds for transfers connected to disaster recovery in recent years. In the early days of the pandemic, Paysafe's Skrill removed fees to transfers into Italy, where the coronavirus hit particularly hard in early 2020. —John Adams

Prepaid cards expand in India

Indian fintech Pepper Money is collaborating with the National Payments Corporation of India and merchant technology company Pine Labs to issue a prepaid card via the national Rupay payment network. The product, called the Pepper Money Dreams Card, is expected to reach more than a million consumers within the next year. The card is designed for smaller towns and rural areas, where financial services are not as accessible as in India's larger cities. Pepper Money will partner with about 100 local businesses in fashion, travel, electronics, dining and health care at launch. The NPCI estimates the Indian prepaid card market is about $119 billion and is expanding at a compound annual growth rate of 36%. India's government has encouraged expansion of non-cash payments for years, often through controversial steps such as removing huge amounts of paper money from circulation and taking a hard line on U.S. payment firms that could cut into Rupay's share. —John Adams

Klarna adds global shopping, loyalty tools

Sweden-based buy now/pay later fintech Klarna is expanding its AI-powered online shopping capabilities and loyalty features in various countries, according to a Wednesday press release. Consumers in the U.K., Germany, Denmark and Norway may click on items to purchase within videos on Klarna's app, a feature previously available only in the U.S. Klarna also added a streamlined item-return feature for U.S. and U.K. shoppers and the capability for U.S. Klarna customers to finance a wide range of retail gift cards through Blackhawk Network. Klarna users in the U.K. now may earn "Klarna Cash" rewards when checking out with Klarna online or within the Klarna app, a feature planned for expansion to other markets soon. —Kate Fitzgerald

China’s UnionPay launches virtual B2B card for cross-border commerce

UnionPay, China's state-owned card network based in Shanghai, has teamed with Singapore-based TripLink International for a virtual business-to-business payment card designed for cross-border commercial payments, according to a Tuesday press release. The UnionPay Virtual Commercial Card, which targets airline and hotel operators, offers a way for businesses to manage real-time cross-border transactions with built-in details and direct connections to local settlement systems, optimized for international shipping and travel. —Kate Fitzgerald

Goldman Sachs opens office in India to tap talent

Goldman Sachs opened an office in southern India to take advantage of the country's talent, months after Prime Minister Narendra Modi pitched the nation's growth potential to the firm in New Delhi. The Hyderabad-based office will be used for adding clients, platform engineering and global enterprise partnerships, the investment bank said in a statement Thursday. The nine-story tower spread over 351,000 square feet (32,609 square meters) can accommodate almost 2,500 employees. Goldman established its presence in Hyderabad in 2021 with operations ranging from engineering and finance to emerging technologies such as cloud computing and artificial intelligence, it said in the statement. It currently has over 1,500 professionals in the Hyderabad office with 75% being new hires. —Ragini Saxena, Bloomberg News

Major Egypt banks suspend debit-card use in foreign currency

Egypt's biggest lenders including Commercial International Bank SAE and Banque Misr suspended the use of local-currency debit cards abroad, as the cash-strapped North African nation races to stop a drain on foreign exchange. CIB, the country's largest private bank, told account-holders by text message that effective Tuesday their debit cards could only be used for Egyptian pound transactions within the country. Arab Bank also stopped international transactions for debit cards, according to a statement on its website, while a customer representative for state-owned Banque Misr said it was doing the same. Banque du Caire, Credit Agricole and QNB Alahli took similar actions, they told customers in messages. Credit cards can still be used.

The lenders gave no official reasons for the moves, which come as Egypt is mired in its worst foreign-exchange crunch in years. Authorities have devalued the pound three times since early 2022, with the currency losing almost half its value against the dollar. The pound's stability in recent months has come at a cost, draining the economy of foreign exchange through a drawdown of commercial banks' net foreign assets, which shrank in August by over 5% from the previous month to $13.1 billion, according to calculations by Cairo-based HC Research. Their net foreign liabilities hit an all-time high in June. —Salma El Wardany, Bloomberg News

CIBC names first board member who self-identifies as Indigenous

Canadian Imperial Bank of Commerce said prominent Indigenous business leader Mark Podlasly will join its board of directors. The bank confirmed Tuesday that Podlasly will be its first director to self-identify as Indigenous. Podlasly is chief sustainability officer of the First Nations Major Projects Coalition, a collective of 144 Indigenous nations aimed at owning major infrastructure projects such as pipelines. He also chairs the First Nations Limited Partnership, which includes 16 Indigenous nations engaged in a CA$500 million ($368 million) commercial agreement with the Kitimat LNG project in British Columbia. Podlasly, who officially joins the CIBC board on Nov. 1, also sits on the board of Hydro One. —Christine Dobby, Bloomberg News

BMO Capital Markets CEO Barclay retiring, Tannenbaum taking role

Bank of Montreal said Dan Barclay is retiring as chief executive officer of BMO Capital Markets, to be replaced by the head of global investment and corporate banking, Alan Tannenbaum. Barclay, 57, joined Bank of Montreal two decades ago and has been CEO of BMO Capital Markets for five years, and has served on the firm's executive and operating committees. After a 32-year investment-banking career, including time at Morgan Stanley and Bank of Nova Scotia, he will transition to a role as senior adviser to the CEO effective Nov. 1.

The 55-year-old Tannenbaum will take over as head of BMO Capital Markets on the same day, reporting to Bank of Montreal CEO Darryl White, and join the company's executive committee. He's been in his current position since early 2021, after stints as head of the global corporate finance solutions group and co-head of global equity products. He joined Toronto-based Bank of Montreal in 2010. —Daniel Taub and Derek Decloet, Bloomberg News

Australia to regulate digital payment systems via new RBA powers

Australia plans to regulate digital payment platforms including Apple Pay and Google Pay under new laws that provide the Reserve Bank with additional powers, the government said. Up to 35% of credit card transactions in Australia were conducted via digital payments in the three months through June, with mobile wallet use expanding among all demographics, according to RBA figures. The government on Wednesday will release for public consultation new legislation to regulate digital payments that aim to update the country's existing regulations.

Under the changes, the RBA will oversee new payment systems, including digital wallets, while ministers will obtain additional powers to crack down on services or platforms that are deemed to present risks of national significance. The new laws are expected to be brought before parliament by the end of 2023. —Ben Westcott, Bloomberg News