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This week: Capital One, CurrencyCloud, Deutsche Bank, Facebook, Flywire, MoneyGram, Revolut, Société Générale, Western Union
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New data, new insights on international payments. Every week.
 

Compliance as a core competency

There are two sides to every story. On one side, news broke on Tuesday that a fraud allegation against Revolut had been referred to London's Metropolitan Police. 

This follows a story last week reporting the company temporarily switched off its automated compliance system which was meant to stop suspicious money transfers. Revolut CEO Nikolay disputes this, saying whilst one system was switched off due to incorrectly flagging good payments, a second system was still running underneath. Our understanding is Nikolay's is the side you should be listening to.

But if there is one thing payment companies have to do well, it's compliance. When they fail, the costs can be huge (and the PR can be very challenging).

The numbers above are substantial and there are a few repeat offenders. In particular, MoneyGram's recent $125m fine was a result of its behaviour after a similar fine six years earlier. 

The obvious question is what if any action will be taken against Revolut if deficiencies are found. Although once you navigate through the bad press and some customer service issues, it’s not clear any regulatory issue was actually breached.

So, whilst real facts remain thin on the ground, we eagerly await the results of any investigation.
Follow the biggest players in the cross-border sector

Where RegTech can help

Fortunately, we've just completed our first report on RegTech and International Payments. That's 35 pages of research on the sector, which we're distributing for FREE because we love it so much. Here's the breakdown:

What is RegTech
According to the FCA, it's “a subset of Fintech that focuses on technologies that may facilitate the delivery of regulatory requirements more efficiently and effectively than existing capabilities.” 

In other words, tech that makes it easier for your company not to get in trouble or worse get fined.

How to manage different risk appetites
Banks and payment companies have different appetites for risk, in part due to their client set. A payment company serving a small number of high-net worth individuals assesses risk very differently than a company digitally on-boarding thousands of customers daily who may be sending funds anywhere around the world. 

But wherever you sit in this risk spectrum KYC, AML and ongoing monitoring are critical components of any payments business. 

As Stephen Lemon, Co-Founder of Currency Cloud, succinctly explained to me this week:

"The real cost in this business is KYC and onboarding the customers."

And when you get it wrong, the financial and reputation penalties can make things go very wrong. So do it right.

Everything else in the report
Sector maps, analysis on how RegTech helps payment companies, detailed profiles of the leading RegTech companies, and more.
 
Access our RegTech and Payments Report

Pricing insight #6

If you've failed to catch on, pricing insights 1-5 have come over the last five weeks. As we're so obsessed with pricing data, here's one for this week, looking at the huge discrepancy in how US banks structure their FX curves:

While we hear a lot of talk about price consolidation and the effects of payment companies in the space, there are still significantly different pricing models in play even for major corridors such as USD to GBP. The picture changes even further once you take into account fees, payment methods, and exotic corridors. 

Think it's time to (re)evaluate your own pricing strategy? Get in touch to find out more.
 
Get the best FX pricing data, APIs and more
On our radar this week:
Curated by FXC Intelligence's Team 
Facebook next to go crypto?

The tech giant is reported to be launching a crypto to enable instant money transfers

Techcrunch
New Zealand looks to Open Banking

Another market looks to open up launching its first API standards 

Paymentsnz
WorldFirst acquired CurrencyVue

And pushes ahead with its B2B ERP offering

Global Banking & Finance
Flywire is flying 

The receivables focused payments company hits the $10bn flow mark 

Globenewswire

Missed some of our reports?

How RegTech impacts international payments (here)
Future of MoneyGram (here)
Interview with OFX CEO Skander Malcolm (here
Interview with Ebury co-CEO Juan Lobato (here)
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Have a super week,

Daniel
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