FinTech Futures: Top five stories of the week – 25 August 2023
Here’s our pick of five of the top news stories from the world of finance and tech this week.
Mastercard launches CBDC Partner Programme
Payments titan Mastercard has formed a central bank digital currency (CBDC) Partner Programme to “foster collaboration” in the space with key players including blockchain technology and payment service providers (PSPs).
Confirmed partners currently include the blockchain and Web3 software company Consensys, the multi-CBDC and tokenised assets solution provider Fluency and blockchain specialists Ripple, among others.
The cohort will be tasked with providing a “greater understanding” of the advantages and disadvantages of CBDCs, and how they can be implemented in a way that is “safe, seamless and useful”.
“As we look ahead toward a digitally driven future, it will be essential that the value held as a CBDC is as easy to use as other forms of money,” says Raj Dhamodharan, head of digital assets and blockchain at Mastercard.
Financial Conduct Authority steps in to protect access to cash
The UK’s Financial Conduct Authority (FCA) has announced new protections on the horizon for cash deposit and withdrawal services.
The financial watchdog has responded to a request made in the UK parliament’s Cash Access Policy Statement in its Finance Services and Markets Act 2023 to “ensure reasonable provision” of these services.
The regulator confirmed this week that it would “seek to maintain a network of cash access facilities that is in keeping with the current distribution of services”.
It’s now in the early stages of forming new rules that would require banks and building societies to assess “the reasonableness of cash provision when certain significant changes in local access occur or are proposed”.
Standard Chartered global head leaves to found fintech start-up
Manohar Chadalavada, who has been with Standard Chartered since 2005, confirmed in a LinkedIn post this week that he is to join “the founding team/CxO at an exciting stealth start-up/fintech”.
As such, he will depart his current position as managing director and global head of AI, ecosystems and open banking this month, having held the post since April 2021.
Chadalavada has proven to be an integral force in the bank’s operations for a number of years, particularly within the Asia-Pacific region.
He served as country chief risk officer for the Philippines between March 2014 and October 2016, group head retail risk services and innovation from October 2016 to November 2018 and global head servicing and transaction journey, retail innovation and fintech from November 2018 to April 2021.
The exact specifics of his next step beyond Standard Chartered have yet to be announced, but Chadalavada has ensured the industry that details “will be unveiled shortly”.
Citi makes debut investment in LatAm with Peruvian FX platform Rextie
The strategic investment arm of banking heavyweight Citi completed a “significant investment” in Rextie this week, a Lima-based fintech offering currency exchange, factoring solutions and pay-in and pay-out payment processing.
The deal will see Rextie integrate Citi’s FX technology, including CitiFX Pulse and Instant Payments, into its FX services, providing its 182,000 business and consumer users with real-time payment capabilities, greater liquidity and automation and more competitive rates.
It is Citi’s first investment in the region, and is poised to enable Rextie to grow its platform and reach more business users. Terms have not been disclosed.
Morgan Stanley hit with £5.41m fine after energy traders used WhatsApp to discuss market transactions
Morgan Stanley & Co. International plc (MSIP) has been fined £5.41 million by Ofgem for “not recording and retaining electronic communications between January 2018 and March 2020” after the firm’s wholesale energy traders used WhatsApp on their private phones to discuss energy market transactions.
It is the first recordkeeping fine of its kind in Great Britain that relates to trading wholesale energy products, and mirrors the recent activity of the US Securities and Exchange Commission (SEC), which recently handed penalties to 11 Wall Street firms for similar offences.
As well as admitting to the breaches and agreeing to pay the fines, Morgan Stanley has put in place measures to ensure that it doesn’t repeat the same mistakes, including “enhanced staff training and the strengthening of its internal systems and controls”.
“This fine sends a strong message to market participants that they must comply with all REMIT rules or face enforcement action,” said Cathryn Scott, regulatory director of enforcement and emerging issues at Ofgem.