This April, The Fintech Times is focusing on all things embedded finance, the integration of financial services into non-financial products and services. First, we turn our attention to the growth of Banking-as-a-Service (BaaS). 

BaaS enables non-banking institutions to connect with banks via APIs, to offer services traditionally restricted to licensed and fully-regulated banks.

While BaaS solutions offer a lot of potential, many have concerns regarding the regulatory compliance of providers and the third parties that use them. To find out more about the regulatory hurdles the BaaS space possesses, we reached out to industry leaders and asked them which regulatory challenges fintechs should be most aware of.

Compliance issues apply to everyone

Paul Staples, group head of embedded banking at Clearbank, the UK-based clearing bank, explains that ensuring regulatory compliance remains a consideration for both BaaS providers and the companies that use them.

“There has been a lot of regulatory attention on BaaS providers, partly due to compliance concerns, but also their rapid growth. It’s important for companies to interrogate how their provider deals with regulation and compliance issues.

“Do they have a banking licence that means their customers’ money is protected up to a certain level? Or it is an e-money licence where money is safeguarded? If the latter, how does this safeguard work? How are anti-money laundering regulations adhered to?

“When relying on a BaaS provider for financial services, then any compliance issues they face also become your problem too. This works both ways, of course – any business should expect questions from their provider on their customers and business practices, so they remain compliant.”

‘Companies must stay agile and informed’

Sergiy Fitsak, managing director at software development company Softjourn, also breaks down the importance of carefully ensuring compliance: “When leveraging BaaS, companies must navigate a complex landscape of regulatory challenges that vary by jurisdiction.

“Key among these challenges is ensuring compliance with local and international banking regulations, which can include stringent requirements for anti-money laundering (AML), know your customer (KYC) processes, data protection, and privacy laws.

“Fintech companies using BaaS need to ensure that their services comply with these regulations to prevent legal and financial repercussions. Moreover, the reliance on banking partners for regulatory compliance means fintechs must meticulously select and manage these partnerships to ensure alignment with regulatory expectations and safeguard against reputational risk.

“As BaaS operates in a relatively new and rapidly evolving segment of financial services, companies must also stay agile and informed about potential changes in regulatory frameworks, which could impact their business models or the services they offer.”

BaaS faces significant regulatory scrutiny

Recently, BaaS providers have experienced significant levels of regulatory scrutiny, explains. Raman Korneu, CEO and co-founder of digital banking platform myTU.

“When utilising BaaS, companies confront significant regulatory hurdles, particularly concerning standardised offerings from third-party BaaS providers. In my opinion, this homogenised landscape stifles innovation and differentiation within the fintech sector.

“A core regulatory challenge arises from the uniform compliance settings imposed by BaaS providers, which often fail to meet the specific needs of individual fintech firms and their respective markets. Insufficient attention to AML, KYC, and CFT protocols during customer onboarding further compounds this issue, leading to regulatory non-compliance.

“Examples such as the Bank of Lithuania‘s revocation of PayrNet‘s license and interventions against BaaS providers like Solarisbank, Modulr, Blue Ridge Bank, Cross River and Choice Bank (the most recent case when a BaaS sponsor bank has gotten into regulatory trouble) demonstrate the regulatory scrutiny faced by BaaS providers and BaaS-dependent companies.

“To address these challenges, companies require differentiated compliance frameworks tailored to their unique business models and market dynamics. However, the current BaaS setup lacks the flexibility needed for such customisation, hindering companies’ ability to adapt to regulatory changes efficiently.

“In summary, regulatory challenges for companies leveraging BaaS stem from standardised offerings that do not adequately cater to individual compliance needs. Customised compliance frameworks are essential not only for ensuring regulatory compliance but also for fostering innovation in the fintech sector, yet the current BaaS model falls short in providing this flexibility.”

Making ‘financial interactions more secure’

Marc Milewski, CEO of Zum Rails, an open banking payments software provider, offers advice to firms looking to utilise BaaS: “One of the biggest challenges for organisations that want to participate in BaaS is ensuring that they’re offering it in a way that makes financial interactions more secure, rather than making it easier for those with nefarious intentions to engage in money laundering and fraud.

“Local and regional regulations exist to help mitigate this, and every company leveraging BaaS needs to assess which of these laws and regulations apply to its business. Money transmitter license (MTL) requirements, for example, vary by state in the US, and there are additional requirements that need to be taken into consideration for companies that operate in multiple countries, such as registering with The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) or the Financial Crimes Enforcement Network (FinCEN) in the US.

“These types of regulations place the onus on the business to ensure they are not enabling money laundering or other criminal activities within their platform. Companies tend to think about this through the lens of their banking services only, but security and anti-fraud actually starts much earlier in the financial interaction—from the time of onboarding funds onto the platform.

“In addition to regulatory compliance, various security measures including KYC tools that enable real-time transaction monitoring, name matching and sanctions screening should be built into BaaS offerings from the start.”

Increased scrutiny in the US

Eric Bierry, CEO of Sopra Banking Software, also discusses how regulation surrounding BaaS varies from region to region: “Particularly in the US, regulators are beginning to pay closer attention to partnerships between banks and fintechs and looking into various guardrails to protect consumers from any unregulated financial offerings.

“BaaS is one of the main ways that traditional banks are partnering with fintechs to enable them to provide their own banking services. In these instances, regulatory burdens are transferred directly onto the banking provider, who is responsible for bringing things like banking licenses and FDIC-insurance to the relationship.

“Meanwhile, the fintech or end company can focus on technology and the customer experience in which they excel. While it’s a valuable model for both banks and fintechs to focus on what they’re good at and improve the lives of their customers, banks do need to be increasingly aware of, and take steps to prevent, any unregulated activities that can result from these relationships.”

BaaS requires ‘thorough oversight’ from all parties

Finally, Pam Kaur, head of bank technology at strategic investment fund BankTech Ventures, reveals how banks and fintechs should approach the space: “Both banks and fintech companies getting involved with or leveraging BaaS need to be aware of AML and BSA regulations around the services they or their partners are offering.

“All programmes should have thorough oversight from all involved parties along with a sound understanding of who is responsible for what in the lifestyle of the relationship. Banks should not rely on their fintech partners to be the only source of truth on this type of oversight and should have a dedicated BSA officer with full authority and oversight of these programs.

“On the other hand, fintechs should also not assume that the bank they have partnered with has a strong BSA program, and should continue to monitor and address issues to the best of their abilities as well.

“BaaS providers also need to be aware of the impact of and how to unravel these relationships should the need come.”

Social media posts containing images and videos generate more engagement than text alone. The reasons are two-fold. First, social platforms prioritize visual content over text in feeds. Second, visual updates attract attention and thus user response.

Creating compelling social media visuals used to take much time. No more. AI technology can instantly generate images and videos from text prompts.

Here are three AI platforms to get started.

Visme

Visme is an online image creator and editor with infographic features. A new addition is generating infographics from text. To test, I prompted Visme to create a downloadable, infographic-like checklist that I could repurpose into social media posts.

First, I described what to create. My prompt was:

Create a checklist on how to improve productivity when working from home.

Visme then asked if I had anything to add. I said no, and the tool generated a visual list. I can edit or customize it as needed.

Visme’s “Basic” plan is free with limited templates and design assets. Paid plans start at $29 per month.

Predis.ai

Predis.ai is a social media content generator. It can create social media posts that include images, videos, or carousels — all from prompts, scripts, articles, or product specs. It can also generate humorous memes.

In my testing, I used a similar prompt as with Visme:

How to improve productivity when working from home.

It instantly created the video and caption below.

The caption required little editing. It included popular hashtags, a question, and steps.

Struggling to stay productive while working from home? You’re not alone! Follow these tips to boost your productivity and make the most out of your remote work experience. 1. Create a consistent schedule to establish a routine and stay on track with your tasks. 2. Minimize distractions by setting boundaries with family members, turning off notifications, and finding a quiet space to work. 3. Designate a specific workspace that is comfortable and free from clutter to help you focus. 4. Remember to take regular breaks to rest your eyes, stretch your body, and recharge your mind for optimal productivity. #WFHtips #ProductivityHacks #RemoteWorkSuccess.

I could have edited the video or added a logo. If I were to set up a brand kit, every auto-generated image or video can optionally include my company’s logo and URL.

Predis.ai can connect to users’ social media platforms and directly publish updates. A content calendar allows users to schedule posts.

Predis.ai’s free version includes 15 AI-generate posts per month. Paid plans start at $32 per month for 60 posts and many more features.

Canva

Canva’s new Magic Studio is available for Pro users and as a free trial. It creates social media images and videos from text prompts.

I entered the same prompt — “How to improve productivity when working from home” — and chose a color scheme. The tool generated 10 images to choose from and edit. Each had slightly different messaging, which helped me brainstorm a potential final image. Examples included:

• “Tips to help you stay focused when you work from home,”
• “Make work from home productivity a reality,”
• “Tips for working at home.”

Magic Studio’s editing features include background removal and visual effects. I could have uploaded my own image and prompted Canva to edit it, such as adding texture, animation, or three-dimensional effects.

Canva’s Pro version is $119 per year (with a free trial) and includes AI features and a brand kit with a logo, name, and color scheme.

International banking group Crédit Agricole has partnered with Worldline, the payment and transactional services company, to launch a new joint venture CAWL; a payment services brand for merchants in France.

CAWL will offer all-in-one payment solutions combining acceptance and acquisition and integrating value-added services specific to each business sector: industry-vertical offerings to simplify merchants’ lives and enable them to focus on developing their businesses.

CAWL’s solutions will enable merchants to focus on their growth, effectively manage their commercial performance, optimise their sales, and mitigate fraud risks, thus fostering the development of their business activities.

Meriem Echcherfi, CEO of CAWL, explained: “CAWL has the ambition to be a major player in payments for all merchants in France, with an offering that combines service, proximity, and high technology, leveraging the strengths of Crédit Agricole and Worldline. We also aim to be a leader in innovation by creating integrated offerings that significantly increase the added value for merchants and, by extension, for their own customers.”

CAWL combines Worldline’s technological expertise, offerings and services with Crédit Agricole Group’s commercial performance and distribution power.

The payment services provider aims to provide complete and innovative offerings for all merchants, regardless of size, industry, and sales channels. For larger merchants, CAWL will offer omnichannel solutions with dedicated commercial teams and expertise for each industry.

Starting in 2025, CAWL will roll out all-in-one offerings by industry verticals. Crédit Agricole Group banks plan to widely distribute these offerings, through dedicated teams, as well as via an entirely digital channel.

By leveraging the capabilities and technologies of Worldline, alongside Crédit Agricole Group’s knowledge of the French market, CAWL will launch a platform with new features enabling merchants to offer their customers a seamless and omnichannel shopping experience and optimise their conversion rates and commercial activities.

All new offerings will enable merchants to access multi-currency, multi-country, multi-payment network services, and alternative payment methods, supported by a pan-European acquisition platform and personaliszed services.

Global law firm DLA Piper, in partnership with The Fintech Times and The Fintech Power 50, recently hosted a fascinating evening event at its head office in London addressing how established players and disrupters in the insurance industry can navigate through the complexities of artificial intelligence (AI).

Regulatory hurdles and compliance intricacies emerged as focal points, with speakers exploring the complex landscape of legal frameworks governing AI including the EU AI Act and the UK regulator’s approach to AI regulation, highlighting the importance of understanding forthcoming regulatory changes and their implications.

Contractual considerations were scrutinised, illuminating the path towards leveraging AI while mitigating associated risks. Real-world insurtech use cases were also shared, showcasing the transformative potential of AI when deployed effectively. While ethical considerations prompted introspection on aligning technological advancements with corporate values.

Let’s take a look back at the evening’s highlights.

Opportunities with AI

Pierre Berger, a corporate, financial services and insurance partner in the firm’s Belgian offices, kicked off the evening with an introduction outlining how AI has the potential to profoundly reshape society, altering how we work and interact.

Despite concerns about job displacement, Berger sees AI as a source of innovation and prosperity.

He reassured the audience that regulatory hurdles and compliance issues need not hinder the opportunities presented by AI, citing examples of tech leaders viewing regulations as beneficial for business growth.

Berger also underscored the multifaceted roles AI can play, from serving as a personal assistant to transforming industries like insurance.

“My partners and I are convinced that there are many opportunities and, in our view, data governance, compliance and regulations do not necessarily negatively impact on those opportunities. Some leaders of big tech companies I speak with even stated AI regulations will help them growing their business in the field of AI,” said Berger.

AI and the law

Next up came James Clark, a data protection, privacy, and cyber security lawyer at DLA Piper’s Leeds office, who outlined the current and forthcoming regulatory landscape for AI.

He highlighted the diverse legal frameworks indirectly impacting AI development, including data protection, employment, and intellectual property laws. Clark also shed light on forthcoming regulations like the EU AI Act and the UK’s decentralised approach to AI regulation.

“If you are the provider of an AI system, you have to be able to demonstrate that you’ve put a range of controls in place when you are building an AI system in terms of data quality, data governance, technical security around the AI system, and then ultimately complete a conformity assessment,” he explained.

AI in insurance

Alexander Hamels, a financial services and insurance lawyer at DLA Piper in Brussels, then took the audience on a journey through the disruptive potential of AI in insurance.

He painted a vivid picture of AI’s transformative power, from shaking up product design to streamlining claims management. Despite the industry’s cautious approach, Hamels highlighted real-world examples of AI’s impact, such as a 30 per cent optimisation in claims management processes.

However, he didn’t shy away from addressing the risks, including biases, discrimination and customer satisfaction challenges. Hamels stressed the importance of responsible AI implementation, highlighting the need for robust risk assessments, governance measures and data protection safeguards.

Hamels commented: “The successful implementation of AI tools can be a competitive advantage for insurance undertakings. There are use cases across the entire value chain of the business. However, there are important risks involved, which are on the radar of regulators and legislators. It is the responsibility of the industry to proactively develop solutions to address these risks to avoid regulatory intervention.”

Contractual considerations for AI

DLA Piper legal director Nichola Donovan offered insights into the critical assessment of AI service commitments, cautioning against presuming inherent reliability and highlighting the necessity for comprehensive evaluation before implementation.

She explained the importance of scrutinising liability, intellectual property ownership, and potential third-party infringement risks. Donovan also discussed the evolving nature of liability in AI contracts, stressing the need for a balanced approach to risk and reward.

Finally, she outlined key considerations regarding restrictions on usage, service levels, and oversight, particularly in comparison to traditional human-led service delivery models.

“AI can be difficult to explain and understand and that can make oversight and control more challenging,” she said. “So perhaps think about putting the onus on the supplier to have those quality assured systems and controls in place, and also potentially a proactive obligation to notify you in the event that things go wrong so you get that critical early warning notice and you have the opportunity to take steps on your own side to mitigate those potential losses.”

Insurance use cases

Up next was Chris Halliday, director at Willis Towers Watson (WTW) – a primary and reinsurance broker, multi-discipline consultant, risk adviser and specialist technology provider – who talked about use cases in insurance for AI and data science, drawing from his extensive experience as an actuary.

He outlined the evolution of AI over the years, especially the emergence of generative AI and its transformative potential in areas like code development and customer retention strategies.

One area he underscored the significant impact of AI was on enhancing operational efficiency and improving customer service, particularly in the context of claims management.

Despite the opportunities presented by AI, Halliday also outlined various challenges, including organisational friction, integration with legacy systems, and governance and ethical considerations.

He advocated for a collaborative approach and a robust target operating model to effectively harness the power of AI in insurance operations.

AI and insurtech

Sharing her insights and experiences in on-demand insurance for SMEs and freelancers, Janthana Kaenprakhamroy, CEO at Tapoly, offered a refreshing perspective on the practical applications of AI in the insurance industry.

With a blend of personal anecdotes and industry knowledge, she touched on the value creation potential of AI, particularly in the development of new products tailored to specific needs and the enhancement of customer experiences through 24-hour service capabilities and personalised insurance offerings.

Kaenprakhamroy delved into real-life use cases, showcasing how AI can streamline operations, improve risk assessment and fraud detection, and redefine claim processing. She also highlighted the significance of aligning AI strategies with business goals and fostering a supportive team culture, saying:

“Culture, I would say, is one of the biggest challenges for any AI implementation. And from my personal experience of developing a successful AI strategy, the number one priority for me is to work out your goals goal and what the end result you want with your AI project.”

AI in insurance: panel discussion

Concluding the event Jonathan Clarke, partner at DLA Piper in Birmingham, moderated a lively panel discussion, touching on the key themes that drove the evening’s discussions. He was joined by Kaenprakhamroy, Halliday and George Mortimer, a partner at DLA Piper in London as they discussed the intricate relationship between the AI and insurance, focusing on ethical implications and sustainability considerations.

The panel discussion was particularly engaging, with many insurer and insurtech clients in the room adding to the liveliness of the session. Challenging questions from the floor further enriched the dialogue,with topics ranging from concerns over the insurance market’s dual focus on AI and environmental, social, and governance (ESG), and the impact on lawyers when the EU AI Act comes into force, in particular the need for additional training.

Transparency emerged as a key theme, with speakers discussing the importance of transparent machine learning algorithms and the regulatory focus on outcomes rather than understanding every parameter. Additionally, the discussion touched on the significant focus of the insurance market on AI and the emerging tension between AI adoption and sustainability due to energy consumption.

Evening finale

To end the evening with closing remarks, Anthony Day, partner at DLA Piper, acknowledged the existential threats posed by AI, such as fake news and deep fakes, but remained enthusiastic about the opportunities AI presents. He touched on AI training and stressed the importance of staying informed about regulatory developments.

“I’m actually hugely infused about AI and the opportunities in this space,” he concluded.

Additional reading materials on AI can be found here: Patentability of AI – A Legal Perspective on Emotional Perception / DLA Piper, Common ground between the US AI Executive Order and the EU AI Act

Every week we publish a rundown of new products from companies offering services to ecommerce and omnichannel merchants. This installment includes updates on fulfillment, design services, financing, digital marketing, payments, ecommerce customer support, and shoppable videos.

Got an ecommerce product release? Email [email protected].

New Tools for Merchants: April 8

ShipStation adds fulfillment consulting. Shipping software platform ShipStation has launched a fulfillment consulting service. In addition to workflow and process optimization, ShipStation consultants will help merchants find the most cost-effective shipping and improve their warehouse layout and order pickup. Experts will also ensure merchants are using all the features of their ShipStation account.

WPBeginner launches Pro Services for WordPress design and maintenance. WPBeginner, a site for free WordPress tutorials and resources, has partnered with Seahawk Media to launch WPBeginner Pro Services. With Pro Services, small business owners can hire vetted WordPress professionals to help design a website, launch an ecommerce store, handle customization projects, maintenance, and more.

Revenued launches financial marketplace for small businesses. Revenued, a company that helps small and medium-sized businesses access working capital, has launched an online marketplace to give SMBs access to tailored financial resources and insights to support growth and stability. Revenued’s marketplace focuses on three verticals — banking, insurance, and compliance — with a curated list of vendors and platforms. Revenued intends to expand the marketplace with additional verticals.

Flip partners with AppLovin to relaunch ad marketplace. AppLovin, a marketing platform, and Flip, a social commerce site, have announced that Flip will relaunch its marketing platform for brands utilizing AppLovin’s Axon technology. The partnership will enable Flip to extend its audience network to AppLovin’s 1.4 billion daily users. Additionally, Flip announced it’s raising $144 million in funding, including $50 million from AppLovin.

Liberis and Shop Circle partner to launch small business ecommerce funding in the U.K. and U.S. Liberis, a global finance platform, has partnered with Shop Circle, an ecommerce software provider, to provide Shop Circle merchants with flexible funding. Shop Circle provides tailored tech stacks and custom packages for Shopify merchants and, now, flexible funding options.

CommentSold launches PopClips for shoppable videos. CommentSold, a provider of video commerce technology, has announced the launch of PopClips to bring shoppable videos on all its platforms, including Videeo for Shopify, Popshoplive, and CommentSold. PopClips offers short video clips wherein five products can be tagged per video. These clips are designed to integrate across various platforms, including websites, mobile apps, and marketing channels such as email and external blogs.

Adyen partners with Adobe Commerce to enable online and in-store payments. Adyen, a fintech platform, is partnering with Adobe Commerce to deliver online and offline payments to global enterprise merchants. According to Adyen, the new partnership enables Adobe Commerce merchants to connect online and offline payments using Adyen’s unified commerce solution. In addition, enterprise merchants operating on Adobe Commerce can leverage Adyen’s checkout, fraud protection, conversion optimization, and data to enhance customer experiences.

Skipify and Visa partner to enhance Skipify’s connected wallet. ​​Skipify, a fintech company focused on the checkout experience, has partnered with Visa’s Digital Commerce Program. Skipify customers can link Visa Click to Pay cards with their Skipify Connected Wallet. Once enabled, Skipify’s identity-powered wallet can recognize participating Visa Click to Pay cardholders on a merchant’s website. The integration utilizes advanced Visa network tokenization technology to minimize the risk of fraud and provide a more secure payment environment.

PayPal adds features for small businesses. PayPal enables small businesses to accept payments, including PayPal, Venmo, and PayPal Pay Later products. PayPal will now give small businesses access to four new features to drive payment acceptance. The features are (i) Apple Pay as a checkout option, (ii) the ability to save payment methods with the PayPal vault for faster future checkout, (iii) a real-time account updater to help customers keep payment methods current, and (iv) access to Interchange Plus Plus (IC ++) pricing.

Chase launches Media Solutions platform. Chase has launched Media Solutions, a digital service that allows brands to connect with Chase’s 80 million customers. In turn, those customers benefit from personalized offers and incentives. The launch of Chase Media Solutions follows the integration of Figg, a card-linked marketing platform that Chase acquired in 2022.

Outvio launches Desk for ecommerce customer support. Outvio, a post-purchase platform for ecommerce, has released Outvio Desk, an AI-powered customer support service. Outvio Desk natively collects all data related to online orders, customers, deliveries, and returns and exchanges. The product features AI automation for repetitive, time-consuming delivery tasks and integrates with email, chat, and social media. Users of Outvio Desk can manage engagement on Facebook, Messenger, Instagram, and WhatsApp.

As difficult macroeconomic and geopolitical conditions persist, growth is becoming especially difficult for SMEs to achieve in the UK. Unpaid invoices, cash flow difficulties and a lack of support have left many small firms in a difficult spot. In this environment, can SMEs find the support they need?

Here, Sinead McHale, CEO of Satago, the cloud-based cash flow management and invoice finance solution, discusses whether the government’s stance on late payments goes far enough for SMEs.

SMEs are the backbone of the UK economy, providing local jobs and revenue across all sectors. However, the current economic climate and high inflation are still massively hindering them from reaching their full potential.

Late payments, tight cash flow, and poor access to capital are still big issues stopping SMEs from being able to invest in growth – and all too often, creating bad debts.

With over £32billion in late payments plaguing them, SMEs need sustained and meaningful policy action from the government going forwards, and better working capital tools.

How is the government currently supporting SMEs?

The UK Government’s recent launch of a Small Business Council comes hot off the heels of its Cash Flow and Prompt Payment Review in late 2023. Among its most important areas of focus, the Council has been set up to address malpractice against SMEs, notably late payments. From April this year, businesses working with SME suppliers in the public sector will also be expected to demonstrate average payment terms of 55 days.

In his Spring Budget announcement earlier this month, Chancellor Jeremy Hunt had an opportunity to reengage with SMEs. The announcement called to raise the £85,000 VAT threshold, and to extend the Recovery Loans Scheme, both areas that show the government has responded in part to calls made by the sector including the Federation of Small Businesses.

An extended 5p cut in fuel duty and proposed extension to advance loan repayments has also been welcomed by vulnerable households and especially some of the SME founders running businesses on their own.

But did these measures go far enough to help SMEs to thrive as well as survive? And what about tackling the cost to the UK economy of a late payment shortfall of £32billion?

The pervasive problem of late payments

‘Cash is King’ has never been more relevant to SMEs in 2024 – many of which are at risk of going out of business in mere weeks without it. In 2022, the Federation of Small Businesses found over half of UK SMEs experience cash flow problems due to late payments – and, in fact, when businesses do fail, it’s more likely to have been due to running out of cash, rather than a problem with their profits, customer demand, or quality of their product.

Failure from larger customers to pay the SMEs they’re doing business with on time, has far-reaching impacts on SME owners. Over a third (34 per cent) of SME owners have put their life savings and home on the line for their businesses by signing a Personal Guarantee for a business loan, according to Purbeck Personal Guarantee Insurance’s survey last year.

The results mean many SMEs will be driven into increased borrowing to manage their cash flow, putting themselves and their business in a truly precarious position – just to stay afloat and keep trading. It’s little wonder that, while being preoccupied with simply keeping their businesses above water, many SMEs are losing out on the chance to invest in their own growth.

It’s clear that tackling late payments requires tougher regulation from the government to increase penalties on those businesses ignoring their payment terms – but there’s more the financial services industry as a whole can do to support SMEs. This is where better options for SMEs to reduce the risks of doing business come into play. SMEs desperately need better-working capital tools that can provide secure, reliable, and most importantly, faster, access to credit to unleash their potential and focus on growth.

How better-working capital tools could add billions to the UK economy

In fact, the right working capital solutions directly address the power imbalance, in favour of SMEs. For example, access to invoice financing tools means SMEs can convert unpaid invoices into reliable cash flow quickly. This provides more than just a lifeline for SMEs – they’re also helping shore up employment, project investment, and the wider UK economy.

In contrast to overdrafts, credit cards and personal loans, which are fixed lines of credit and generate additional interest faster, invoice financing tools are designed to support SMEs with more flexibility, scaling access to credit and working capital as they issue larger invoice volumes.

Invoice finance can give SMEs access to cash tied up in unpaid invoices – equipping the business with immediate access to working capital. For larger companies that might run on debt, it can be a chance to pay this money back, too. Unlike riskier options which could mean SMEs accrue more debt, invoice finance takes the pain out of getting paid and lets them get on with growing their businesses for the wider benefit of the UK economy, too.

For SMEs to be able to both operate healthily and realise their growth ambitions, they rely on steady, secure and reliable access to cash flow. But they can’t do it alone, and this is where both the government and industry experts, should come together to combine better practical regulation, with better working capital tools, for the best outcomes for all.

At this year’s PAY360 conference held at London’s Excel – one of the largest payment events of the year in the UK –  more than 5,000 payment and finance professionals from around the globe gathered to network and share insights on the hot topics in the industry.

The Fintech Times took the opportunity to catch up with Lloyds Bank and fast-growing fintech CoBa Technology – a cloud-hosted platform that seamlessly connects banks and businesses – to learn more about their recent collaboration.

Robin Scher, head of fintech investment at Lloyds Banking Group and Tom Stoddart, head of market sales at Lloyds Banking Group, were joined by Carl Hasty, CEO and co-founder of CoBa, to discuss their partnership as well as how they are collaborating to enable clients to digitally manage their banking needs through automation and workflow connections.

Investing in startups

According to Scher, Lloyd’s created a £50million fund internally to invest in early-stage fintech startups in order to “reduce the cost of change or increase the pace of change”.

He explained why that included CoBa: “One of the things we look for and we absolutely love is great founders with real vision and an ability to execute. We look at the product-market fit as well, something that we think is going to work in the market. We also invest in things that we are going to learn from, that will innovate with us and partner with us in a true partnership fashion.”

In agreement, Stoddart added: “We look for an aligned philosophy particularly with the purpose that we have as an organisation. An alignment over goals of what looks good from a execution and delivery perspective is absolutely critical.

“What we have found by working with CoBa is that as a large organisation with multiple data sources we can bring that together and hand it to CoBa who are much more nimble and agile in terms of the way that they can deliver solutions for our customers.”

Hasty also added: “We focus on strategic relationships and want to work with a bank right at its core. We’re very much about bringing the bank and the client together.”

To find out more about their collaboration and how the strategic partnership plans to co-create tailored solutions for clients., watch our interview below.

The Fintech Times meets Lloyds Bank and CoBa Technology at PAY360

The payments process can often be arduous and infuriating when unforeseen complications arise. Looking to ensure a checkout experience is as seamless as possible, Skipify, the checkout fintech specialist, has partnered with Visa through the Visa Digital Commerce programme to simplify and accelerate the payment process. 

By combining Visa’s extensive digital payments expertise with Skipify’s digital wallet, Skipify is poised to deliver convenience and security to consumers at checkout. In the early phases of the partnership, Skipify customers in a growing list of global markets will be able to link Visa Click to Pay cards with their Skipify Connected Wallet.

Skipify’s digital wallet is embedded by merchants to help ease the challenges of checkout commonly experienced by shoppers and increase the rate of conversion. Once enabled, the direct connection means that Skipify’s identity-powered wallet will be able to recognise participating Visa Click to Pay cardholders on a merchant’s website, surfacing available cards more seamlessly.

The integration utilises advanced Visa network tokenisation technology to help minimise the risk of fraud and provide a more secure payment environment, helping to allow merchants to offer a more frictionless checkout experience without increasing exposure to fraud risk.

Advancing the future of commerce

The participation also allows Skipify to significantly expand its reach and offer its innovative payment solutions to a broader audience than ever before.

“We’re empowering merchants with an unparalleled checkout experience,” said Ryth Martin, founder and CEO of Skipify. “Merchants can authorise more shoppers automatically, drive revenue, and ultimately earn more shopper lifetime value. We are proud to deliver this level of impact with Visa by our side.”

Additionally, Skipify’s partnership with Visa reinforces a commitment to advancing the future of commerce through innovation and collaboration.

“We’re empowering businesses with convenient and secure ways to accept payments, giving them the opportunity to enrich consumer experiences and get even closer to their shoppers,” said Mark Nelsen, SVP, regional product and innovation at Visa. “Skipify has been an incredible partner because of their dedication to our merchants and cardholders. We’re delighted to drive this next wave of innovation in payments with them.”

What do families, the military, Eurovision, holidays, and how-to videos have in common? They all provide content marketing ideas for May 2024.

Content marketing is the act of creating, publishing, and promoting, say, articles and videos to attract, engage, and retain customers. Content is the foundation for search engine optimization, social media marketing, and email newsletters.

Content marketing relies on reciprocity. Folks appreciate receiving helpful info and often respond positively to businesses that provide it. The trouble is coming up with a nonstop stream of worthwhile content.

What follows are five content marketing ideas you can use for May 2024.

International Day of Families

In 1993, the United Nations established the International Day of Families to recognize that families are the foundation of stable societies.  

The occasion is observed annually on May 15. It’s an opportunity for marketers to create family-related articles, videos, or podcasts.

The content could be a nod to the day itself or connect your company’s products with a family activity. Here are three example article titles of the former:

• “10 Habits to Start on the International Day of Families,”
• “How to Celebrate the International Day of Families,”
• “10 Bonding Activities for International Day of Families.”

And here are three examples of connecting products to families:

• Outfitter: “Top 50 Day Hikes for Families.”
• Garden supply shop: “How to Make Flower Gardening Fun for Families.”
• Kitchen Store: “Tips for Including the Entire Family in Meal Planning.”

Armed Forces Day

Armed Forces Day in the U.S. occurs on the third Saturday in May, the 16th in 2024.

President Harry S Truman established Armed Forces Day in 1950, consolidating three other observances. The event typically features parades, displays, and various community celebrations to demonstrate support for the military and its members.

Armed Forces Day can be a respectful and thoughtful vehicle to connect with customers, especially those in military families or with ties to the armed services.

Content ideas include:

• Profiling service members and their families,
• Recognizing veteran-owned businesses in your supply chain,
• Thanking service members,
• Connecting products to military history.

Eurovision Song Contest

Most Americans learned about the Eurovision Song Contest in 2020 when Netflix released a Will Ferrell comedy about it. But the inspirational event has been around since 1956.

The European Broadcasting Union created Eurovision to encourage unity and post-war rebuilding efforts through music.  

Each participating country contributes an original song. The performances are notable for their broad range of styles, elaborate staging, and sometimes quirky acts, reflecting each nation’s unique culture. 

The competition has launched the careers of numerous artists, including ABBA and Celine Dion.

Over the years, Eurovision has grown in scale and spectacle, becoming a beloved, flamboyant celebration of culture and pop music. This year’s Eurovision will be held from May 7 to 11 in Malmo, Sweden.

Eurovision-inspired content could address culture, fashion, music, or history. 

May’s Top 3 Holidays

Three holidays dominate the May U.S. calendar in terms of popularity and familiarity: Mother’s Day (May 12, 2024), Memorial Day (May 27, 2024), and Cinco de Mayo (May 5, 2024).

These dates are key for content marketers — for promotion and helpful info.

First, all three dates are important for retail sales. Americans spent more than $35 billion on Mother’s Day purchases in 2023 and typically spend about $500 per household on Memorial Day weekend. Cinco de Mayo is the longstanding celebration of Latino culture. 

Second, the holidays are excellent opportunities for articles, videos, and podcasts.

Mother’s Day:

• “Ultimate 2024 Mother’s Day Gift Guide,”
• “17 Homemade Mother’s Day Gifts,”
• “23 Affordable Mother’s Day Gift Ideas,”
• “Better-than-flowers Mother’s Day Gifts,”
• “Gifts for the DIY Mom.”

Memorial Day:

• “10 Ways to Celebrate Memorial Day,”
• “Ultimate Memorial Day BBQ Guide,”
• “The True Significance of Memorial Day,”
• “50 Playlists to Commemorate Memorial Day,”
• “Decorating Tips for a Patriotic Memorial Day.”

Cinco de Mayo:

• “Recipes to Celebrate Cinco de Mayo,”
• “5 Must-visit Sites on Cinco de Mayo,”
• “The Story behind Cinco de Mayo,”
• “Cinco de Mayo Decorating Tips and Trends,”
• “Cinco de Mayo Ultimate Shopping Guide.”

Summertime Videos

This month’s final content marketing suggestion focuses on search engine optimization and content distribution.

Summer begins June 20, 2024. Yet publishing summertime content in May gives Google and other search engines time to crawl and index it.

Consider producing groups of videos that help folks achieve a summer-related task. Each video package should include several parts.

• Full-length video instruction.
• Several shorts from the full-length version.
• An overall guide to all components.
• Text-based social posts from the video transcriptions.

For example, an online seed retailer could publish a video package about planting a kid-friendly flower garden. The retailer could:

• Embed the full video in a comprehensive blog post. This would be the hub.
• Release the full video on YouTube, Rumble, and Facebook. Each points to the retailer’s blog.
• Deploy video shorts on YouTube, TikTok, X, and Instagram, again linking to the blog.
• Publish tips on Facebook and X with links.

African Export-Import Bank (Afreximbank) has partnered with Nigeria-based financial institution Sterling Bank to launch its supply chain finance product ‘Payables Finance’ across Nigeria.

Under this arrangement, Afreximbank will provide financing to corporates and banks in US Dollars and Euros, while Sterling Bank will manage financing in Nigeria.

Payables Finance enables suppliers to access financing from the banking system by obtaining early payment for invoices which have been approved for payment by their corporate buyers.

Buyers continue to receive trade credit from the suppliers, and the suppliers finance their working capital through the early payment received, enabling them to grow their business. The financing cost is linked to the credit rating of the corporate buyers, thereby making this product particularly valuable for SME suppliers who may face challenges in accessing bank finance at competitive pricing.

The supply chain finance product, branded ‘Afreximbank Tradelink’, is one of the bank’s digital offerings under the umbrella of the Africa Trade Gateway (ATG). ATG provides African corporates and commercial banks with relevant digital tools to access market information, connect with buyers and sellers across the continent for efficient marketing and procurement, facilitate Know Your Customer (KYC) processes, and promote trade payments between African countries in local currencies.

Chukwuka Onuaguluchi, ecosystem banking head at Sterling Bank, said: “Sterling Bank is committed to meeting the trade finance needs of Nigerian corporates and their suppliers and we are proud to introduce this much-needed product in partnership with Afreximbank for the benefit of Nigerian businesses.”

‘Improving access to trade finance in Africa’

Haytham ElMaayergi, executive vice president of Afreximbank Global Trade Bank, welcomes the launch as another milestone in realising the Bank’s vision of transforming Africa’s trade: “Afreximbank identified supply chain finance as a solution for improving access to trade finance in Africa and embarked on a journey to increase penetration through financial intervention and capacity building.

“The Bank’s Factoring Working Group has done extremely well to provide lines of credit to support factoring and has actively promoted factoring across the continent in collaboration with other institutions.

“African businesses now have the opportunity to harness the potential of this product, which has been widely adopted globally, at an accelerated pace by learning from the experiences of other regions and using the latest technologies which have been developed.”

Afreximbank also plans to engage in similar partnerships in other parts of Africa to expand local currency financing capability across the continent in a phased manner. Adoption of the product will be supported by capacity-building events to increase awareness of supply chain finance and its benefits.

Gwen Mwaba, director and global head of trade finance at Afreximbank, also added: “The launch in Nigeria is a first step in Afreximbank’s plans to introduce Payables Finance across Africa in partnership with leading African financial institutions. The product will contribute towards the achievement of the Bank’s strategic objective of reducing the trade finance gap in Africa, particularly for the SMEs segment.”