Uncle Sean's Update - 4/26/24

Happy Friday!!!
 
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• Shout-out to Castellum.AI for joining The BaaS Association reflecting their commitment to enabling sponsor banks and fintech partners to quickly, reliably and accurately comply with KYC and AML regulations globally.  If you have been following ANY of the recent regulatory enforcement actions involving embedded finance & Third Party Risk Management, you know just how important and timely this is.  Check them out at Castellum.AI for their KYC, AML, and compliance-first approach to embedded finance!!!

 

• DCI and DataVisor expand their partnership following a highly successful initial stage of deployment using DataVisor's next-gen technology and fraud solutions for  community banks.  During this next stage implementation, DCI plans to expand this offering to an additional 200+ clients in 2024, further rolling out DataVisor's technology to protect real-time payments and wire transactions.  Good people doing good things to the benefit of community banks – Love it!!!! 🤠❤️

 

• Atomic announced that Frost Bank (FDIC 5510; Total Assets $50B) will be using Atomic’s solution for direct deposit switching – Nice!!!!  Congratulations to the Atomic Team as that is a big win deep in the heart of Texas!!! 👏

 

• In economic news this week, GDP growth slowed to 1.6% for 1Q24, well below expectations of 2.4%.  Meanwhile, PCE inflation metric remains “stickier than cotton candy at the State Fair” as March core PCE comes in at 2.8% (same as last month, expectation was 2.7%), well above the Fed target of 2.0%; and has been running north of 2% for 3 years now... 😲

 

• 👀 It certainly appears that the death of the “middleware BaaS” model has entered its endgame…  TabaPay has agreed to acquire the assets of Synapse following Synapse’s voluntary Chapter 11 Bankruptcy filing for $9.7M subject to court approval.  Banking Dive has a good summary for more detail.

 

• The Federal Reserve released their semi-annual Financial Stability Report for April 2024.  No big surprises that interest rates (including treasury yields at 15 year highs 😫) and funding, CRE refinancing concerns, and increasing CC delinquencies (although still at historically low levels) make the list.  However – I was happy to see a positive summary of the Bank Term Funding Program (BTFP) that wrapped up in March.  
  • “Since its establishment, the BTFP extended advances to 1,804 depository institutions, of which 1,706, or 95 percent, were small institutions with total assets below $10 billion.”  Yessir – that’s a win in my book!!!! 😊👏

 

• Who didn’t see this coming…???  Walmart backed One to introduce buy now, pay later loans setting up a direct competitor to Affirm who has been providing installment loans for Walmart customers since 2019.
  • Also recall where Walmart recently won a legal dispute allowing them to exit the Capital One CC exclusivity agreement early…  Mhmm…
    • Childhood flashback moment - Anyone else remember layaway programs during the Holidays from about a hundred years ago? 🤷‍♂️

 

• Continuing its exodus from expansive retail/consumer banking under the Marcus brand, Goldman Sachs to sell Marcus Invest digital investment accounts (robo-advisor) to Betterment.
  • Per the press release, “Goldman Sachs will continue to focus on growing its Marcus Deposits platform which serves over three million customers globally and has well over $100 billion in consumer deposits.” 

 

• Car-IQ partners with Lewis & Clark Bank to offer a new credit line to its fleet payments service.  This solution enables the specific vehicle to “connect directly to the fleet owner’s credit line and pay for services such as fuel, tolls, repair and more nationwide” eliminating the need for fleet fuel card programs and driver interaction.
  • Check them out at cariqpay.com - Now that’s pretty cool!!!! 🚚🚀

 

• Nacha flex 💪…!!!  Total first quarter ACH Network volume was 8.2 billion payments valued at $20.7 trillion, respective gains of 5.6% and 5%!  Growth was powered by Same Day ACH payment volume of 273.7 million (47% increase YoY) valued at $719 billion (27% increase YoY); with B2B payments growing 10.8%.

 

• Splitit (card-linked installment platform) announced the launch of FI-PayLater enabling banks to offer BNPL to their customers at merchant checkout / point-of-sale.

 

• 👀 Other legal / regulatory developments this week:
  • The Federal Trade Commission (FTC) announces rule banning noncompete agreements….  The U.S. Chamber of Commerce and multiple business trade groups were quick to sue the FTC alleging that a universal ban is too wide reaching and that the FTC is overstepping its legal authority.
  • The Department of Labor (DOL) issues final rule expanding overtime eligibility based on salary.  “Effective July 1, 2024, the salary threshold will increase to the equivalent of an annual salary of $43,888 and increase to $58,656 on Jan. 1, 2025.”

 

• Quite a few personnel moves this week:
  • Figure Technology Solutions appoints Michael Tannenbaum as Chief Executive Officer.
  • Nium appoints Alexandra Johnson as Chief Payments Officer.
  • Temenos appoints Jean-Pierre Brulard as Chief Executive Officer.
  • Melio hires Boaz BenDavid as their first ever Chief Financial Officer.

 

• Notable FinTech funding for the week:
  • Pomelo (international transfer via consumer credit) raised $35M in Series A funding round plus an additional $75M expansion of its warehouse credit facility.
  • Rippling (business workforce and spend management platform) raised $200M in Series F funding round at a valuation of $13.5B.
  • Bump (funding platform for creators) raised  $3M in Seed round.

 
 
Random Uncle Sean stuff:

• HOLY SMOKES it’s been a crazy busy week! 😬  So let’s just jump right into the good stuff…  FINALLY - here are the Dad / Bad jokes to kick off the weekend: 😎🍺
  • Why don’t elephants like to run on the beach?  Because they can’t keep their trunks up… 🐘😅
  • My buddies started a band called 500 Megabytes….  They still don’t have a gig (ba-dum-tis)…. LOL!!!! 🤓
  • Amazon dropped off a package and I asked the driver “do I need to sign for it?”  He said, “no, I can hear you just fine…” 🤠
  • Aunt Patty asked me one time if I thought our kids were spoiled.  I said, “Nah, I think most kids just smell that way.” 🤣😂

 
 
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.