Exclusive: Unite Global gets $5.25m from Svea to launch cross-border payments hub
Unite Global, the Norwegian cross-border payments correspondence software which complements Swift, has secured $5.25 million in funding to launch its ‘UNITE’ banking payments hub.
The new venture will select 8-12 partner banks, creating the beginnings of an interconnected community which offers an instant global payment and settlement capability for any bank connected into the hub. The lucky banks to be chosen will share global payments revenues with UNITE.
Swedish financial group Svea Ekonomi funded the new capital injection and took a 4.95% share of the company in return, valuing Unite Global at $106 million. Svea can also double its investment in the firm at the same price per share if it wishes, which would make it the second largest shareholder with 9.91%.
“We are no longer in the 1970s,” Unite’s Global’s chief technology officer (CTO) Tord Coucheron tells FinTech Futures. “Instant, cheap in-country payments are now commonplace […] however the underlying bank to bank process must still be improved.”
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Coucheron acknowledges that the large portion of retail customers which were “mystified as to why it might still take[s] up to a couple of days and $30 to send money overseas” have now been snapped up by the fintech unicorns.
But now, in the real-time world, “banks are waking up to this reality where new, off-bank, entrants increasingly threaten their business,” he says.
The CTO describes the launch of UNITE as giving banks a “ready-made, minimum risk solution to meet today’s customer expectations”. Resting on Unite Global’s cross-border payments software, the hub will choose its partners based on “their in-country instant payment presence” and whether the bank is a “best fit” for the hub.
Accessible through a “simple” application programme interface (API) which can sit on top of legacy systems, the hub promises “minimal disruption” and “minimum cost” in its wiring up with future bank partners. Each partner will get a unique UNITE Bank Identification Code (UBID) for every branch, which will automatically mirror any legacy identifying code.
“Partner bank discussion[s] and selection is ongoing now, with a final determination targeted for later this year,” Unite Global confirms. The hub is expected to be up and running from the second half of 2020.
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