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This week: Azimo, Checkout.com, ComplyAdvantage, CurrencyCloud, Glocal-e, Libra, moneycorp, Onfido, Revolut, TransferWise, WorldFirst, WorldRemit
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New data, new insights on cross-border payments. Every week.
 

The fastest growing UK challengers

Last week, we launched what is now one of our most widely shared and referenced market mappings ever - The Challengers vs The Incumbents in the Cross-Border sector. If you missed it, get it here.

We continue that theme and start this week with a look at the some of the top performing UK based private companies who are in or serve the sector. We preview their 2018 results as few have officially reported these numbers. We also dig into WorldFirst's new price changes too. And we cover some of the current issues with obtaining payment and banking licenses. 

To some high performing UK challengers:
The above analysis looks at privately held UK companies who are in cross-border payments and Regtech companies serving the cross-border space. Revenues are all above £5m.

Some takeaways:
  • The biggest jump by far has come from Revolut. In the year to Dec 2017, their revenue was £12.8m. In the year to Dec 2018, it has jumped to £58.3m. This shows real traction.
  • Regtech is hot. Players such as Onfido and ComplyAdvantage who support many of the players in the space are selling their wares fast.
  • Cross-border ecommerce and facilitating cross-border online payments is a great segment to be in (see checkout.com - biggest ever European Series A raise)
This is just one snippet of some of the global trends. Although the companies above are headquartered in the UK they operate in many countries across the globe.  It used to be 20% year or year growth was impressive. No more.
Download the incumbents vs challengers map

WorldFirst shifts gear

Ant Financial, the financial arm of Chinese ecommerce giant Alibaba bought payments company WorldFirst at the turn of the year (deal analysis here). Now backed by one of the largest company's globally, WorldFirst can really focus on growth.

This can be most clearly seen by its very recent change in its pricing (screenshot from the WorldFirst website): 

This pricing model compares to the more traditional pricing curve that WorldFirst used to operate:

What are the implications:
1) With the support of Ant Financial, WorldFirst can focus on growing market share

2) The new pricing structure is one that also supports a faster scaling of the business. Quoting prices over the phone requires a different customer journey to a simple one size fits all price structure. 

3) WorldFirst is following the transparency and technology models of players like TransferWise but WorldFirst's pricing is even simpler as it is not differentiated by currency corridor. 

4) The one interesting nuance in WorldFirst's new pricing model is that it is based on total annual flows rather than a single transfer. This requires taking a small leap of faith with a new customer but will also help encourage commitment of ongoing business.

This is a bold move by WorldFirst. We'll be able to assess the impact of this price change over the coming year once we see the response from customers and the change in market share. Given the reduction in price and simpler model, we certainly expect it to be positive. 

To track the pricing of all the leading players globally, get in touch.


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The trials and tribulations of licenses

Obtaining a banking license is not easy.

Just ask Revolut who this week canned their Luxembourg banking efforts to focus on Ireland. 

The Singapore Monetary Authority recently announced their digital full bank license requirements. Paid up capital required once stabilised is S$1.5bn (c.US$1.1bn)  - that's billions not millions. The Singapore entry ticket is S$15m (US$11m). Will Singapore still be as popular a destination with this requirement when Europe's requirement is typically EUR5m?

Credit to moneycorp who this week secured a Brazilian banking license for their local subsidiary. They will be one of five licensed FX banks in the country.

And even if you're Facebook, it's hard to get away with no license. Yesterday, Facebook accepted it has to apply to Switzerland’s Financial Market Supervisory Authority (FINMA) to be regulated as a payment systems operator for its Libra project.

Track the Cross-Border Payments Sector

Meet with us at the big industry events

Sibos at the end of the month with the IAMTN following quickly after.

Get in touch to schedule a meeting with us: 

Let's meet at Sibos, IAMTN or Money20/20
On our radar this week:
Curated by FXC Intelligence's Team 
MoneyGram partners with Visa

Visa partnership will offer debit card deposit options
Yahoo Finance
The US CFPB starts new action

The Consumer Financial Protection Bureau brings a new enforcement
Compliance Week
BNP Paribas partners with Kantox

Kantox's dynamic hedging product leads to another banking partnership
BNP Paribas
Stripe goes product crazy

Stripe launches a lending product and a credit card
Techcrunch

Missed the last few weeks?

Mapping 150 Cross-Border Payment Companies: Incumbents vs Challengers (here)
Inside the turnarounds at Western Union and MoneyGram (here)
Mastercard and Visa are taking on the sector (here)
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Have a great week,

Daniel
Copyright © 2019 FXC Intelligence Ltd, All rights reserved.

New York | London

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