Uncle Sean's Update - 10/15/21

Happy Friday!!! 
 
Sign up here to have the Uncle Sean Update sent direct to your inbox each week.  Here is the Uncle Sean Update for 10/15/21:
 
Straight from the get-go this week, Uncle Sean goes Off The Rails.  What is this ‘Off the Rails’ you ask???  This is my warning that an unsolicited op-ed will ensue; so you can skip it and scroll down if you like.  It is intended as opinion and designed to spark debate, thought, and maybe even change; and I always welcome all comments, criticisms, and questions (such as: ‘Were you drinking before positing this mess?’  Or – ‘How do you even hold down full-time employment?’  And one of my favorites – ‘Did your Mom regularly use recreational drugs while she was pregnant with you?’ LOL!!!).  So let’s get to it!!!! 😊

• Ole Mark Zuckerberg once again found himself in hot water with the Senate Commerce Committee (not a place you want to be) this week in response to the Facebook whistleblower testimony.  How does this relate to FinTech and Banking?  I’m glad you asked as this is a cautionary tale that we all should take note of as we move forward in this digital age…..
• We continually hear from industry ‘talking heads’ that “personalization” is critical to the success of community banks if you want to remain relevant.  The “personalization” barrage is persistent and on a daily basis.  I get it, but I also understand that financially speaking, banking is a model of scale.  So how do we accomplish personalization at scale (the dichotomy conundrum)?  Naturally we build this through AI and machine learning, sophisticated data decisioning platforms, algorithms, etc…  Are you listening bankers and fintech leaders?  How about the folks at LinkedIn, wealth mgmt firms, robo-advisors – what could possibly go wrong (sarcasm – just ask Zuck)????  I do believe in AI and machine learning in the evolution of finance – I’m just saying that we need to tread carefully and responsibly as to not shoot ourselves in the foot as we digitally scale our operations.
• And lastly to drive my point home….  SEC Chair, Gary Gensler gave a speech this week (disclaimer – not on behalf of the Commission or SEC staff) regarding digital analytics in finance and digital engagement practices (DEP).  Specifically pointing attention to robo-advisors and mobile investing platforms utilizing DEPs to optimize and enhance customer experience (CX) – questioning “what are they optimizing for?”  Is it for the investor returns, or for the firms returns…  Any time the SEC Chair talks about concerns related to the use of predictive data analytics, machine learning, and demand for data – we should probably listen.
• In summary, we all have a responsibility to monitor what is socially acceptable and understand that this is not static as societal norms change and evolve from generation to generation (whether we like it or not) – not to mention the continual evolution of technology and the role it plays within finance and banking.  How many times have you heard someone talk about harnessing the consumer data and purchasing info that is stored within a bank’s core processor?  How much is too much info; and how do we make sure we do no harm?  I guess it’s a good thing that us lowly humans still have a role to play in monitoring the recommendations of the machines….  Otherwise, enter Skynet (Terminator) – LOL!!!!

 
Now back to the rest of the Uncle Sean Update:

• Oportun (Nasdaq: OPRT) is the latest FinTech / Challenger Bank to withdraw their U.S. bank charter application joining the ranks of Monzo last week and Brex back in August.  In a statement, Oportun plans to refile for “a bank charter with the OCC and plan to amend elements of our charter application to reflect changes to our business.”
  • Probably did not help that Oportun has recently been under federal investigation by the CFPB with a “focus on the company’s legal collection practices from 2019 to 2021 and hardship treatments offered during the COVID-19 pandemic.”

 

• Real inflationary concerns are starting to mount as the Social Security Administration announced a 5.9% cost of living adjustment for 2022 – WOW!!!!!  For reference, this is the largest annual increase in 40 years; and 2021 SSA COLA was a meager 1.3%.  Additionally, the U.S. Bureau of Labor Statistics (BLS) released their Sept CPI Summary this week that showed a 5.4% increase for All Urban Consumers (CPI-U) over the last 12 months.  Yep, it’s starting to feel a little beyond “transitory” at this point – it’s time to get that Fed tapering machine going!

 

• Splitit (BNPL) announced a partnership with Discover to offer Splitit installment options to Discover Global Network Cardholders worldwide.

 

• StreetShares getting it done this week with the announcement that the StreetShares Atlas Program will be integrated with Fiserv core beginning in Q42021.  This gives Fiserv the added feature to allow financial institutions to manage the full SMB “lending lifecycle from digital document capture, underwriting, offer management and closing.”  Congrats!!!

 

• Mbanq (BaaS FinTech) and Temenos teamed up to offer Credit Union-as-a-Service (CUaaS) platform to enable US Credit Unions of any size to “accelerate their digital transformation and deliver innovative digital financial services and outstanding experiences to members.”

 

• Reuters reported that 96 advocates including the National Consumer Law Center have called upon the US CFPB to further regulate earned wage access products as a form of credit arguing that fronting money to workers ahead of payday poses unaddressed risks.

 

• Continuing the spirit of October being Cybersecurity Awareness Month – check out KeepMyBankSecure.com, a cooperatively produced and underwritten resource for North American independent banks and financial institutions to learn and stay informed of the latest in cybersecurity planning and strategy.

 

• FinTech funding ran considerably hot this week:
  • Shout out to our friends at Atomic (payroll API infrastructure) announcing $22M in Series A funding round – Uncle Sean loves these guys and it is fun to watch them grow and succeed!!!!
  • Productfy (BaaS / embedded finance) raised $16M in Series A finding round.  The company claims that with its platform, developers can “configure in hours, integrate in days, and go from idea to full stack deployment in as little as three weeks.”  The article goes on to state that “since July, the startup has seen 119% month over month revenue growth. It currently has eight clients, including HatchCard.”
  • Pomelo (credit based int’l transfers) raised $5M in Seed funding.
  • Alviere (embedded finance platform) raised $50M in Series B for a total funding of $70M since April.
  • Black Kite (third-party cyber risk ratings / vendor risk management) raised $22M in Series B funding.
  • Halo (structured investing platform for individuals) raised $100M in Series C to continue to revolutionize and democratized protective investing.
  • Shift5 (military and transportation fleet cybersecurity platform) raised $20M in Series A funding round to further protect critical U.S. infrastructure.
  • Bolt Financial (online checkout payments solution) raised $393M in Series D funding.
  • GoodLeap (POS home financing platform for sustainable improvements) closed an $800M investment round at a $12B valuation.
  • Celsius Network (crypto lending) closed a $400M investment at a $3B valuation.
  • Lively (HSA) raised $80M in Series C funding round.
  • Lendflow (SaaS embedded finance) raised $10.8M in Series A round.
  • Tala (digital lender offering micro-loans in emerging markets) raised $145M in Series E funding to expand international operations as well as launching crypto products for emerging markets.

 
 
Random Uncle Sean Stuff:

• Check out Captain James Tiberius Kirk (aka William Shatner) describing the Blue Origin spaceflight as the 90 year old sci-fi hero obtains U.S. astronaut status.  Pretty cool!!!!
• Special shout out to the entire FedFis Team as this was (err “still is”) a wild and crazy week!!!
  • We have QA going on for preliminary release of 3Q21 bank, credit union, and bank holding company reg data; as well as the release and summary updates for 3Q21 Fintech Analytics© and Direct Bank data.
  • Oh, and we have our annual FI FinTech Roundup conference next week in Fredericksburg, TX.
  • We have a new product launch that we are unveiling at our conference next week for Community Bankers and State Bank Associations – and it is SUPER COOL (I can’t go into any more detail yet or they will shoot me – LOL).
  • Not to mention ongoing video interviews with the FinTech Cowboys and business as usual!!!
  • DANG – we’ve been busy!!!!  😊

 
 
Have a GREAT weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at [email protected] | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | [email protected] #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.
​