FinTech Futures: Top five news stories of the week – 23 February 2024
Here’s our pick of five of the top news stories from the world of finance and tech this week, featuring Capital One, Toast, Napier AI, Xalts and more.
Capital One acquires Discover Financial Services in $35bn deal
Capital One to buy Discover in £35bn deal
US financial services giant Capital One is set to acquire Discover Financial Services in an all-stock transaction valued at $35.3 billion.
The Virginia-based firm, which claims to hold $348.4 billion in deposits and $478.5 billion in total assets, says the procurement of Discover “is a key foundation” in its “quest to build a global payments company”.
Capital One expects the transaction, which is planned to close in late 2024 or early 2025 and is subject to regulatory and shareholder approvals, to deliver a return on invested capital of 16% in 2027, with an internal rate of return of over 20%.
The firm plans to leverage Discover’s customer base, technology, and data ecosystem to “deliver enhanced value to a franchise of over 100 million customers”.
US hospitality fintech Toast to cut 550 jobs as part of restructuring plan
Toast, a US-based fintech providing point of sale (POS) software and hardware for the hospitality industry, is set to cut approximately 550 jobs as part of a board-approved restructuring plan.
The fintech, which was founded in 2011 and is headquartered in Boston, says the plan will also extend to “certain other actions to reorganize the company’s facilities and operations”, and is due for completion by the end of the 2024 fiscal year.
It forecasts that the restructuring will incur charges of between $45 million and $55 million this quarter, primarily attributed to “severance and severance-related costs and certain other costs related to facilities”.
The fintech says the plan is intended to “promote overall operating expense efficiency”.
UK regtech Napier AI secures £45m funding from Crestline Investors
Napier AI lands £45m investment
London-headquartered regtech Napier AI has landed a £45 million investment from US-based Crestline Investors to help boost its planned business expansion.
Founded in 2015, Napier harnesses big data technology alongside artificial intelligence (AI) and machine learning to provide corporate compliance and anti-money laundering (AML) solutions.
The financial crime compliance firm, which currently claims to serve 150 institutions, states that the cash injection will drive its growth ambitions and exemplifies the “transformational time in the industry for know your customer (KYC) and anti-money laundering solutions”.
In addition, the company says that the investment will fuel the further development of its new explainable AI-powered screening and monitoring offerings.
Fintech start-up Xalts grants Contour Network new lease of life with announced acquisition
Singapore-based start-up Xalts is set to acquire Contour Network for an undisclosed sum in an attempt to promote the adoption of digital technologies within trade and supply chain finance.
Since its inception back in 2017, Contour has operated a decentralised global trade finance network that connects businesses, partners and financiers across supply chains, and promoted an initial remit of digitising letters of credit.
Although backed by banks including ANZ, BNP Paribas, HSBC and Standard Chartered, the network announced in October 2023 that it was to wind down operations as a result of insufficient funding, while a source told Ledger Insights at the time that Contour was only processing 60 to 70 transactions a month.
With the sun quickly setting on a company that appeared to be ahead of its time, Contour has now seized a second chance with Xalts.
FinTech Wales completes new CEO search with appointment of Sarah Kocianski
Sarah Kocianski appointed new FinTech Wales CEO
FinTech Wales has announced Sarah Kocianski as its new CEO, succeeding Sarah Williams-Gardener who served in the position for over three years.
The appointment brings to a close the firm’s search for a new CEO after its call-out last November for someone to “pick up the baton” following the announcement that Williams-Gardener would transition to the role of chair by January this year.
On her appointment, Kocianski says she “can’t wait” to “champion what Welsh fintechs have to offer” and will look to leverage her experience to “help support the wider fintech ecosystem in Wales”.
Kocianski has over a decade of experience working as a fintech and insurtech strategist across start-ups and global institutions. She has previously worked in strategic roles at firms such as Monitise, Business Insider UK, 11:FS, and SJK Insights.
