FinTech Futures: Top five news stories of the week – 19 January 2024
Here’s our pick of five of the top news stories from the world of finance and tech this week, featuring Citigroup, Sainsbury’s Bank, DirectID, ZestMoney and more.
Citigroup to cut 20,000 jobs over two years after Q4 downturn
Citigroup to cut 20,000 jobs by 2026
Citigroup has announced that it will cut approximately 20,000 jobs across some of its business lines by 2026 in a sweeping attempt to streamline its operations following a “disappointing” fourth quarter of 2023 in which the firm reported a $1.8 billion net loss on revenues of $17.4 billion.
Announced during the group’s fourth quarter earnings call last week, Citi expects the cuts to approximately 10% of its workforce will generate run rate savings of approximately $2 billion by the time the restructuring is completed.
Citi CEO Jane Fraser asserts that “2024 will be critical” for the group as it continues to implement “simplifications” across its five core areas of business and “allocate capital with rigor”.
Sainsbury’s set to wind down banking business
UK supermarket giant Sainsbury’s has announced it is planning a “phased withdrawal” of its main banking business following the completion of a strategic review of its financial services division.
The retailer says that Sainsbury’s Bank will now be gradually wound down with the provision of its financial services to be allocated to “dedicated financial services providers” through a similar distributed model to that of its insurance offering.
It adds the winding down of the bank is expected to happen “over time” with no immediate impact to the services it provides.
DirectID founder departs after 13 years
James Varga departs DirectID (Image: LinkedIn)
James Varga, who founded Edinburgh-based risk and decisioning platform DirectID in 2010, says he has made the “pivotal decision to move on”.
He had served as the company’s CEO since its inception until July last year, when he passed the torch to former L&C Mortgages exec Chris Mills.
“This journey has been extraordinary, pioneering fintech and championing open banking before these became global movements,” he writes in a departing email.
According to the email, these future endeavours will include co-founding the X3 Global Summit, due to kick off in May, and collaborations with Tech Export Support Group, Shift, Fintech Scotland, and others.
HashKey bags $100m Series A funding at unicorn valuation
Hong Kong-based digital asset financial services group HashKey has secured around $100 million in a Series A funding round at a valuation of over $1.2 billion.
The group says the latest round saw participation from both new and existing investors but has so far not revealed any names, with Bloomberg reporting that OKX Ventures was one of the round’s lead investors.
With the fresh capital, it says it plans to “solidify” its Web3 ecosystem, diversify the product offerings of its licenced business in Hong Kong, and drive its global expansion efforts.
DMI Group snaps up BNPL fintech ZestMoney
ZestMoney acquired by India’s DMI Group
Indian buy now, pay later (BNPL) start-up ZestMoney has been acquired by DMI Group in a fire sale.
The news follows reports in December last year that ZestMoney was closing down after unsuccessful efforts to find a buyer or raise additional capital.
The deal will grant DMI Group, which operates a financial platform across India featuring digital finance, asset management and housing finance products, access to all of Zest’s brand rights.
The group’s non-bank financial company (NBFC), DMI Finance, will be assigned as the preferred lender to the Zest platform, while the fintech’s checkout financing platform will also be added to the group’s product suite.
