FinTech Futures: Top five stories of the week – 10 November 2023
Here’s our pick of five of the top news stories from the world of finance and tech this week.
Klarna prepares for IPO with UK holding company
Klarna seeks to launch UK holding company for IPO
Buy now, pay later (BNPL) giant Klarna plans to establish a new holding company in the UK as part of its preparations for a blockbuster initial public offering (IPO).
CEO Sebastian Siemiatkowski sought approval last week among the company’s largest shareholders to form a new legal entity that would sit above its existing corporate structure.
The entity forms an important part of Klarna’s plans for a stock market floatation, and will enable it to leverage the UK’s favourable legal, regulatory and capital markets framework to its advantage.
Now with a UK holding company being established, Sky News reports that a listing could arrive as soon as the first half of next year.
Speaking with FinTech Futures, a Klarna spokesperson reinstates that no firm decision on the time or location of the IPO has been made.
Georgia’s central bank partners Ripple for CBDC pilot
The National Bank of Georgia is harnessing Ripple’s central bank digital currency (CBDC) platform to explore the potential of a digital currency.
The pilot is expected to investigate CBDC’s applicability with business and retail use cases, as well as the reality of delivering the currency for the public sector.
It says its selection of the US-based fintech was driven by the platform’s previous experience in similar pilot projects, including those currently underway in the Republic of Palau, Montenegro and Colombia.
Ripple states that, aside from its existing pilot projects, it’s currently engaged in discussions to facilitate similar pilots with 20 countries around the world.
Brolly founder to lead Monzo’s “charge into insurance”
Monzo hires Phoebe Chibuzo Hugh (Image: LinkedIn)
Phoebe Chibuzo Hugh, founder and former CEO of the digital insurance start-up Brolly, has been hired by UK challenger Monzo this week as head of insurance.
Hugh launched Brolly in 2016 after overseeing its development in the incubator programme Entrepreneur First. The start-up operated as a full-stack digital insurance platform, and was ultimately acquired by Direct Line Group, which specialises in motor and home insurance, in 2020.
Announcing the move on LinkedIn, Hugh says she aims to help Monzo “revolutionise” insurance, adding that despite the insurance industry making “some progress”, “it’s been slow, and the opportunity is still as clear and compelling as it’s ever been”.
The bank has only dabbled in the realms of insurance to date, most notably through its short-term phone and travel insurance offerings. However, its latest strategic hire could put it on track to seize a more sizeable chuck of the market.
SimCorp merges with risk solutions provider Axioma
SimCorp, which operates an investment management platform for financial institutions, is set to merge with global risk solutions provider Axioma.
Both companies have enjoyed a close relationship to date, not only due to the fact that Axioma’s parent company Qontigo has served as a strategic partner to SimCorp since 2021, but also because both companies have operated under the Deutsche Börse umbrella since the group’s €3.9 billion takeover of SimCorp in September.
SimCorp CEO Christian Kromann anticipates the merger creating “a powerful client-first offering across the entire investment management value chain”, and says that the move “strengthens our presence in key markets, such as North America”.
N26 plans to pull out of Brazil in strategic refocus
N26 Brazil to cease operations within two months
German challenger bank N26 is exiting Brazil after two years in the South American market as it shifts the geographical focus of its strategy.
In a notice posted to LinkedIn, N26 Brazil – which is headed by CEO Eduardo Del Guerra Prota – says that the decision “comes on the heels of changes in N26’s global strategy”, with the bank instead looking to focus on its key markets in Europe.
N26 Brazil, which first launched in 2021 following accreditation by Banco Central do Brasil, has seemingly been unable to bring a region-specific product to life, and previously announced that it was cutting 15% of its workforce in July.
Despite telling FinTech Futures at the time that it was “exploring multiple routes to strengthen their future position in the Brazilian market”, the notice posted this week confirms that the bank will cease its operations in the market “within the next two months”.
