FinTech Futures: Top five news stories of the week – 7 June 2024
Here’s our pick of five of the top news stories from the world of finance and tech this week, featuring Robinhood, Visa, Mastercard, JP Morgan, Funding Circle and more.
Visa and Mastercard set to pay $197m to settle US ATM fee lawsuit
The lawsuit was first filed back in October 2011
According to the filing by the plaintiffs’ lawyers last week, the settlement relates to “individuals and entities who were charged unreimbursed access fees to withdraw cash at bank-operated ATMs” since 1 October 2007.
The ATM users represented in the case allege that Visa and Mastercard “agreed, among other things, to so-called Non-Discrimination Rules that allegedly had the effect of increasing the amount of ATM Access Fees paid by the Settlement Class”, according to the filing.
The settlement is subject to court approval. Should it be approved, the filing says it will “resolve all of plaintiffs’ claims against the Network Defendants and will bring this longstanding and hard-fought case to a close”. The lawsuit was first filed back in October 2011.
Both Visa and Mastercard have denied any wrongdoing.
Funding Circle to cut 120 jobs in £15m cost savings drive
Small business lending platform Funding Circle is set to axe around 120 roles within its workforce as part of a bid to simplify and streamline its UK business, according to a recent filing with the London Stock Exchange (LSE).
The cuts form part of the company’s business simplification strategy which, first announced in March, seeks to create “a simpler, leaner and better positioned UK focused operation” as part of its “ongoing commitment to profitability”.
As stated in the LSE filing, Funding Circle expects the strategy to deliver annualised run rate cost savings of around £15 million by 2025.
In addition to the job cuts, Oliver White, Funding Circle’s CFO of four years, has also announced his intention to step down from his role at the end of 2024.
Monzo records first full year of profitability as it eyes international expansion
Monzo announces first full year of profitability
UK-based digital challenger Monzo has announced its first full year of profitability, reporting a pre-tax profit of £15.4 million for the financial year ending 31 March 2024.
The bank says a 2.5x increase in gross revenues – fuelled by fuelled by the diversification of its income streams – to £880 million has helped it turn around the £116.3 million loss it recorded in FY2023.
Also reporting an 88% surge in customer deposits to £11.2 billion, alongside a 2.3 million increase in its customer base, Monzo says it now intends to broaden its presence in the US and European markets.
The bank highlights its view of Ireland as a “gateway” into Europe, indicating that it is in the “early stages” of establishing a Dublin office.
JP Morgan Payments head Takis Georgakopoulos to step down after 17 years at the bank
Takis Georgakopoulos has announced that he is stepping down from his role as global head of JP Morgan Payments, a position he has held for the last seven years, stating he has “decided to pursue a very exciting opportunity outside the firm (to be announced in due course)”.
This is according to an internal memo, first reported by Reuters on Monday, in which Jennifer Piepszak and Troy Rohrbaugh, co-heads of JP Morgan’s Commercial and Investment Bank (CIB), noted that Georgakopoulos has played a key role in helping JP Morgan Payments “become one of the firm’s biggest growth engines, increasing revenue and market share in a highly competitive environment”.
In response to Georgakopoulos relinquishing his position, Umar Farooq and Max Neukirchen have been appointed as co-heads of global payments, effective immediately.
Farooq has served as CEO of Onyx by JP Morgan, the bank’s blockchain-focused business unit, for the past three years. Meanwhile, Neukirchen currently holds the position of global head of payments and commerce solutions.
Robinhood to acquire Bitstamp in $200m deal
Robinhood set to buy Bitstamp for $200 million
Digital trading platform Robinhood has come to an agreement to acquire global cryptocurrency exchange Bitstamp for approximately $200 million.
The cash deal, which remains subject to regulatory approvals, will result in the formation of Robinhood’s first institutional business, bolstered by the 50-plus licences currently held by Bitstamp across the EU, UK, USA and Asia.
“With Bitstamp’s other institutional offerings like white label solution Bitstamp-as-a-service, institutional lending, and staking, Robinhood will enter the space with active and established relationships, infrastructure and industry-leading products,” the platform’s statement on the agreement reads.
In addition, the acquisition of Bitstamp, anticipated to close in the first half of 2025, represents a “major step in growing our crypto business,” says Johann Kerbrat, the general manager of Robinhood Crypto.
