FINTECHMAGAZINE by DIGITALSTARTUP AUGUST 2018 | VOLUME 1 | ISSUE 3
#3
EASTERN PROMISE:
TURKEY’S CASHLESS COMMITMENT p.06
Speeding up the
PAYMENTS PROCESS p.12
Return to the
GOLD STANDARD p.28
Fintech Nation:
MALTA p.34
Zopa: rising to the
CHALLENGE p.24
Creating
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Welcome
Shaking up the status quo in the world of finance is the raison d’être of fintech startups. Traditional processes of making payments and transferring money are among the key areas targeted by up-and-coming firms, disrupting well-established service providers and providing potential solutions to problems stemming from global political turbulence and economic uncertainty. In our cover story, we consider whether new payments technologies can be part of the solution to Turkey’s ongoing financial crisis, with an examination of its long-term commitment to creating a cashless economy by 2023. Current difficulties might keep the country off the radar of many potential investors, but Turkey’s young and tech-savvy population may hold ‘Eastern promise’ for fintech startups and their backers. Moving money around the world is often a slow, frustrating and expensive procedure, but an increasing number of fintech firms are providing solutions to these issues. Among the entrants overhauling the money-transfer market is PaySend. We learn more about the company from CEO Ronnie Millar and find out his views on the future of such services. Solving similar problems for enterprises is digital foreign exchange and payment platform BitPesa, which speeds up the payment process for business users across Africa, as well as reducing their costs. Founder and CEO Elizabeth Rossiello explains the ethos behind her fast-growing company, as well as sharing her experience of being a female fintech entrepreneur. It isn’t just the new players that are disrupting the status quo: peer-to-peer lending pioneer Zopa was the first service of its kind when it entered the market in 2005, and we hear from the company as it prepares to challenge the establishment with the launch of its own bank. There’s also some comfort (of a sort) for traditionalists as we profile Glint – an innovative startup that reintroduces gold as a form of currency that can be bought, sold and spent in the same way as any other, bringing the precious metal into the digital age. Finally, our regular Fintech Nation feature explores the startup scene in central Mediterranean archipelago Malta. Sun, sea and ‘sandboxes’? Sounds idyllic!
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Volume 1 / Issue 3 – August 2018 Editor-in-Chief Andrew Samu Publishing Manager Barry Davies Assistant Editor Fiona McFarlane Designer Katarzyna Matulewicz Sales Manager Szymon Cichoń Published by Digital Startup Ltd Level 39, One Canada Square Canary Wharf London E14 5AB United Kingdom Inquiries | hello@disruptionbanking.com Orders | order@disruptionbanking.com
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CONTENTS 06 Eastern promise: Turkey’s cashless commitment
Could Turkey’s intention to create a cashless economy by 2023 make the country a potential hotspot, despite its current financial crisis? Wendy Atkins reports on ambitious plans
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Speeding up the payments process PaySend CEO Ronnie Millar explains how his company is transforming international money transfers using the bank-card system, and also considers the future of such services
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Creating ripples in the finance market Foreign exchange and payment platform Bitpesa is lowering the cost and boosting the speed of business payments to and from frontier markets. Founder and CEO Elizabeth Rossiello shares her story
24 Rising to the challenge
Zopa’s Chief Customer Officer, Clare Gambardella, tells us more about the forthcoming launch of its own digital bank, building on its success as a peer-to-peer lending pioneer
28 Return to the
gold standard Glint is reintroducing gold as money, making it easier to acquire the precious metal and bringing the world’s oldest currency into the modern era as more than just an investment
34 Fintech Nation: Malta Malta has long been known as a hub for e-gaming services, and its tech culture and state-of-the-art infrastructure are now attracting innovators in the fintech scene
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EASTERN PROMISE:
TURKEY’S CASHLESS COMMITMENT
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AUGUST 2018
Turkey’s recent plunge into financial crisis may not mark the country out as a potential fintech hotspot, but its ambition to go cashless places it among the frontrunners as a destination for tech investment. Wendy Atkins reports
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“ The nation’s spending on ICT as a whole is projected to outstrip the world average”
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F
ollowers of global news will doubtless be aware of turbulent political times in Turkey in recent years, culminating in an attempted coup and the ƬȒȇɎȸȒɮƺȸɀǣƏǼ ȸƺٮƺǼƺƬɎǣȒȇ Ȓǔ «ƺƬƺȵ ÁƏɵɵǣȵ 0ȸƳȒǖƏȇ Əɀ Ɏǝƺ ƬȒɖȇɎȸɵټɀ ȵȸƺɀǣƳƺȇɎ ƺƏȸǼǣƺȸ Ɏǝǣɀ ɵƺƏȸِ !ɖȸȸƺȇɎǼɵً Ɏǝƺ ƬȒɖȇɎȸɵ ƏǼɀȒ ˡȇƳɀ ǣɎɀƺǼǔ ǣȇ Ɏǝƺ Ǖȸǣȵ Ȓǔ Ə ˡȇƏȇƬǣƏǼ Ƭȸǣɀǣɀً ƫȸȒɖǕǝɎ ɎȒ Ə ǝƺƏƳ ƫɵ ȳ ɀƏȇƬɎǣȒȇɀ ƏȇƳ ǝǣǕǝ levels of national debt.
Although such a challenging domestic environment hardly seems to provide an ideal ƫƏƬǸƳȸȒȵ ǔȒȸ Ə ɀɎƏȸɎɖȵً ÁɖȸǸƺɵټɀ ƺɴȵƏȇƳǣȇǕ ȵȒȵɖǼƏɎǣȒȇ ƏȇƳ ǔȒƬɖɀ Ȓȇ ˡȇɎƺƬǝ ȅƺƏȇ ɎǝƏɎ the country might yet be considered as a place to invest. Government plans for Turkey, ɎȒ ƫƺƬȒȅƺ Ə ƬƏɀǝǼƺɀɀ ɀȒƬǣƺɎɵ ƫɵ ًבאאƏȇȇȒɖȇƬƺƳ ƫƺǔȒȸƺ Ɏǝƺ ƬɖȸȸƺȇɎ ˡȇƏȇƬǣƏǼ ɎɖȸȅȒǣǼً ȅǣǕǝɎ ɀɎǣǼǼ ɵǣƺǼƳ Ə ɯƺƏǼɎǝ Ȓǔ ȒȵȵȒȸɎɖȇǣɎǣƺɀ ǔȒȸ ȇƺɯ ƫɖɀǣȇƺɀɀƺɀ ǣȇ Ɏǝƺ ˡȇɎƺƬǝ ɀƺƬɎȒȸ Əɀ Turkish lira notes and coins become a thing of the past. Turkey has set ambitious targets for the country’s technology sector, to be reached in the year that the republic celebrates the centenary of its foundation. In addition to the plan to go cashless, key ICT targets for 2023 include:
» reaching the 30-million broadband subscribers mark; » providing 1,000Mbps internet connections for 14 million homes; » increasing the technology sector’s share of GDP from 2.9% to 8%; » becoming one of the top 10 countries in eTransformation; » having 80% of the population computer literate; » expanding the number of companies in Technology Development Zones (TDZs) to 5,500, employees to 65,000 and exports to US$10 billion; » increasing the ICT sector’s worth to $160 billion and its annual growth rate to about 15%; » expanding the R&D expenditure-to-GDP ratio from 1% to 3%. AUGUST 2018
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Istanbul A HUB FOR STARTUPS
For entrepreneurs, potential investors ƏȇƳ ˡȇɎƺƬǝ ɀɎƏȸɎɖȵɀ ǣȇɎƺȸƺɀɎƺƳ ǣȇ entering the Turkish market, there are numerous places where ideas are exchanged, primarily located in Istanbul. Here is a selection of those that caught our eye: Istanbul Entrepreneur & Startup Networking – an opportunity to network, socialise and share best practice about new ways of building and running a business. Also organises events and workshops with the support of major companies and organisations Turkey OpenStack Meetup – brings OpenStack users together to increase knowledge and expertise Lean Startup Meetup Group – dedicated to lean startup thinking and building lean startup leadership Mobil Istanbul Network – interaction and networking platform for mobile enthusiasts eCommerce Meetup – for eCommerce enthusiasts in Istanbul who want to exchange ideas and generate synergies Startup Founder 101 – brings together aspiring and experienced tech entrepreneurs and gives them the opportunity to meet local founders and investors, and participate in startup workshops Spark Meetup – an environment where Turkish Spark users can solve problems they share together
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According to Invest in Turkey, the country’s investment promotion agency, the total number of mobile subscribers reached 75 million in 2016, while the nation’s spending on ICT as a whole is projected to outstrip the world average. By the start of 2018, spending on hardware, software, IT services and telecoms services had already reached $35 billion. Central to the cashless strategy is card payment system Troy, established by the Interbank Card Center of Turkey (BKM/ Bankalararasi Kart Merkezi) – a partnership of public and private Turkish banks – to reduce cash usage throughout the country and to support the goal of achieving a cashless society by 2023. Troy started life as a domestic card scheme, but has since partnered with Discover Global Network to provide its users with access to 41 million points of sale (POS) and 1.1 million ATMs around the world. It reached another milestone in January 2018, when it introduced Troy Mobile Contactless Payment, enabling users to make contactless transactions via mobile devices. The Troy Turkish Card Payment Market Report reveals the state of the payments market in 2017. There were 194 million payments cards in Turkey (62 million credit and 132 million debit), compared with 158 million in UK and 114 million in Germany ٢ האˡǕɖȸƺɀ٣ً ȅƏǸǣȇǕ ǣɎ Ɏǝƺ ǼƏȸǕƺɀɎ ƬƏȸƳ market in Europe. Among a population of 80 million, there are at least 24.5 million individual credit cardholders, each with an average of 2.2 credit cards in their pockets. Unsurprisingly, card payments have risen steadily and accounted for 37% of household spend in 2017, while cash withdrawals fell to 22% of card transactions. There’s also evidence of a change in ƬȒȇɀɖȅƺȸ ǝƏƫǣɎɀ ǣȇ Ɏǝƺ ˡȇƳǣȇǕɀ Ȓǔ Ɏǝƺ 2017 Card Monitor survey, commissioned by the BKM, which shows a shift towards a
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cashless society. According to the survey, 73% of the participants said they preferred to pay by card while shopping, compared with 65% just two years earlier. Áǝƺ ȸƏɎƺ ƏȇƳ ɀƬƏǼƺ Ȓǔ Ɏǝƺ ƬȒɖȇɎȸɵټɀ ˡȇɎƺƬǝ market growth is also noteworthy. The Deloitte, BKM and FinTech Istanbul ‘FinTech Ecosystem in Turkey’ report ȸƺɮƺƏǼɀ ɎǝƏɎ ˡȇɎƺƬǝ ǣȇɮƺɀɎȅƺȇɎɀ Ǖȸƺɯ ƫɵ 175% over the four-year period to 2016 to reach $29 million. Venture capital and angel investment networks put a total of אِבדڟȅǣǼǼǣȒȇ ǣȇɎȒ ˡȇɎƺƬǝ ǣȇǣɎǣƏɎǣɮƺɀ ǣȇ Ɏǝƺ country during the same period. The report’s authors forecast that Turkey’s ˡȇɎƺƬǝ ɀƺƬɎȒȸ ɯǣǼǼ ƬȒȇɎǣȇɖƺ ɎȒ ǕȸȒɯ ƏɎ an average annual rate of 14%, and that the country will be able to harness its geopolitical advantage of being at the crossroads of Europe and Asia to help turn ǣɎ ǣȇɎȒ Ə ȸƺǕǣȒȇƏǼ ˡȇƏȇƬǣƏǼ ɎƺƬǝȇȒǼȒǕɵ centre in the near future. The government has set up the Financial Technologies Permanent Sub-Committee (Fintech Task Force) to back the growth of the sector and to help make Turkey a world leader in advanced ˡȇɎƺƬǝِ Áǝƺ ÁƏɀǸ IȒȸƬƺ ǣɀ ƬɖȸȸƺȇɎǼɵ bringing together the public and private ɀƺƬɎȒȸɀ ɎȒ ɀɖȵȵȒȸɎ ˡȇɎƺƬǝ ɀɎƏȸɎɖȵɀ ƏȇƳ grow the industry. Organisations playing a key role in the Task Force include the country’s Central Bank, its Banking Regulation and Supervision Agency,
its Treasury Undersecretariat, its Capital Markets Board and its Savings Deposit Insurance Fund. Turkey’s demographics are in its favour ɯǝƺȇ ǣɎ ƬȒȅƺɀ ɎȒ ƳƺɮƺǼȒȵǣȇǕ ˡȇɎƺƬǝ products and setting out on the road to a cashless society. The country has a young, tech-savvy population, was an early adopter of payments technology and served as a testbed for some of the earliest contactless ɀƬǝƺȅƺɀِ XȇɮƺɀɎȅƺȇɎ ǣȇ Ɏǝƺ ˡȇƏȇƬƺ ƏȇƳ tech sectors is also increasing. Business is ready to build on these foundations. Writing in Finance Digest earlier this year, Dr Halil Bader Arslan, Secretary General of the Turkish Exporters Assembly, explained that almost a quarter of Turks are younger than 14 and around half are under 30, providing a strong base of current and future consumers that will be eager to use the latest payment technologies. On the tech adoption front, Turkey has been ahead of many countries of similar size for some time, with a 2015 study from ING revealing that 56% of the Turkish population had used a mobile payment app, compared to just 25% in France and 23% in Germany at that time. As other countries, such as China, India, Sweden and Kazakhstan, also seek to reduce or eliminate their populations’ reliance on cash in the relatively near future, Ɏǝƺ ȸƏƬƺ ɎȒ ƬȸƺƏɎƺ Ɏǝƺ ɯȒȸǼƳټɀ ˡȸɀɎ ɎȸɖǼɵ cashless society seems set to gather pace.
“The country has a young, tech-savvy population, was an early adopter of payments technology and served as a testbed for some of the earliest contactless schemes”
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SPEEDING UP THE PAYMENTS PROCESS According to the World Bank’s latest Remittance Report, $5.1 trillion dollars are transferred daily across the globe. The market today is shared among Ɏǝƺ ȒǼƳ ˡȇƏȇƬǣƏǼ ǣȇɀɎǣɎɖɎǣȒȇɀ ƏȇƳ more than 350 paytech startups. PaySend is not the largest, but the UK-based money transferring service is carving out a niche of its own and has made the headlines several times this summer: once for completing a $20 million funding round, another for reaching the 200,000 customers milestone, and a third for winning the 2018 PayTech Award for Best Card Initiative. PaySend CEO Ronnie Millar talks about his company’s vision and the future of money-transfer services.
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For those who are not familiar with your product, what is PaySend? PaySend is a payments disruptor that allows customers to transfer money for a $1 flat fee, directly from one bank card onto another using the 16-digit card number displayed on the front of the receiver’s bank card. We are sending money to card accounts in 60+ countries and we keep expanding our global footprint. This is our core product, to which we will be adding Global Account in Q3 of 2019. What differentiates PaySend from the competition? PaySend strategically partnered with Visa, MasterCard and UnionPay in order to complete transfers from card to card, rather than from bank account to bank account. This allows us to send money to 12 billion cards on this planet and do it in a matter of seconds, rather than days. Having usage of their established payment networks also
ƏǼǼȒɯɀ ɖɀ ɎȒ ǔȒȸǕȒ ǣƳƺȇɎǣˡƬƏɎǣȒȇ ȅƺɎǝȒƳɀ (IBAN, BIC, account numbers) used by banks, as well as the extensive onboarding, ǣƳƺȇɎǣˡƬƏɎǣȒȇً ƏȇƳ ȵȸȒƬƺɀɀǣȇǕ ȵȸȒƬƺƳɖȸƺɀ seen in competitors. The Global Account project, when launched, will be a digital wallet and ATM-compatible bank card that allows customers and companies to purchase and switch between multiple currencies instantly, including cryptocurrencies. The decision to include cryptocurrencies falls in line with industry predictions that customers will soon demand to use and experience cryptocurrency in the same manner as they do dollars, euros and pounds. What is the motivation behind PaySend’s products? Our primary vision was to capitalise on customers that were underserved by
“Our primary vision was to capitalise on customers that were underserved by banks, while building a loyal customer base by offering a safer, simpler and faster service”
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banks, whilst building a loyal customer base by offering a safer, simpler and faster service. But what led us to pioneer a card-to-card solution was the decision to follow the thread of what customers wished to accomplish with their money transfers. What do they want? They want recipients to receive funds in hand more than they want it in their accounts, and cash, although an obvious answer, was not the right one. Society is moving too fast towards a cashless state. This is why we chose a card-to-card transfer option for Ȓɖȸ ˡȸɀɎ ȵȸȒƳɖƬɎً ƏȇƳ ɎȒ ȅƏǸƺ JǼȒƫƏǼ Account a cash-providing, but ultimately cashless, product. How have customers taken to PaySend? Trust barriers were felt by all independent money-transfer businesses in the beginning, and PaySend was no exception. This stemmed mainly from the industry having been historically dominated by a combination of the large banks and very
large traditional cash-to-cash players. People were attached to sending money via a household name, and so how were startups going to acquire that level of trust? Leaps of faith, from zero to rapid adoption, required trans-generational trust, as well as success. I think the record of paytech companies of varying sizes coupled with impressive VC backing opened channels of trust within the industry, but what really powered consumer trust was the fast development of paytech products engineered to give them better services across the board. From lending to sending money, we are truly focused on improving modern, nomadic lifestyles. In light of recent events. as well as our global network of 12 million users in 60 countries, I would say that, today, PaySend is received positively.
DEBIT
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PaySend has also recently become on of the first residents of Astana International Financial Centre in Kazakhstan. What was the thinking behind this decision? We are incredibly excited about the opportunity. Joining Astana International Financial Centre will give PaySend access to its Fintech Regulatory Sandbox, which allows FinTech innovators to conduct live experiments in a controlled environment under the regulator’s supervision. Kazakshtan is also an excellent platform for growth into Asia. Though isolated from Europe, it is a fast-developing country with excellent resources and faster internet speed than countries like Australia. Great things will originate from there very soon. How does PaySend intend to overcome difficulties involved in long-distance product development? By keeping in mind that despite building a global business, we work within local markets. This means having local people on site who can advise and run operations. The concept of dictating a culturally insensitive central message from London or New York headquarters will simply not work. This is a warning.
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Have you noticed a difference in perception between banks and paytech startups, such as PaySend? !ƺȸɎƏǣȇǼɵِ Áǝƺȸƺ Əȸƺ ƺǼƺȅƺȇɎɀ Ȓǔ ˡȇɎƺƬǝ that are directly competitive, but with that we have also been seeing a development of complementary services between startups and local banking communities, particularly surrounding customers and companies, which banks have habitually overlooked. Fintech alternatives gave smaller businesses a physical chance at banking, and in return have been rewarded by an ǣȇˢɖɴ Ȓǔ ƫɖɀǣȇƺɀɀ ƏȇƳ ɎȸɖɀɎً ɯǝƺȇ Ɏǝƺɀƺ entities started bringing in fresh waves of business, such as current accounts and transfer opportunities. Ironically, the very same commodities that banks were working towards. The surprise element of there being value in these small businesses has worn off, and banks are ready to collaborate with us to better serve new clients and emerging markets. Where will the next disruptions occur in the money-transfer industry? People, like markets, are segmented, and disruptions are welcome additions when they offer customers the luxury of seamless travel, business and lifestyle. Our smart card, which allows users to switch from currency to currency via an app, does just that, so we are hopeful that its popularity will increase.
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I believe we will see several areas of disruption: innovation within supporting companies that will carve out the channels for larger players. Any improvement campaigns for the software development will create waves, particularly with initial soft beta testing, soft launching etc. There is also a number of ways that supporting companies can help service providers with core service improvements, such as procedures for onboarding customers, handling compliance issues and legal hiccups. Those brave enough to pioneer here will be snapped up. Also, companies that harness the trust of their customers to successfully expand services, from transfers to loaning and onwards. They have the potential to carve new channels, and the sum of them will actively mould the paytech landscape of tomorrow.
Consequential results in direct relation to these same companies demonstrating to industry players – old and new – that the generation of one-trick-pony companies is coming to a close. A break from the mantra: ‘You’ve got to be big to succeed’. The exit of this old-school mentality has been a long time coming because, as we’ve seen in banking, ‘big’ does not mean ‘success’. In fact, ‘big’ can guarantee a higher number of mistakes and, at some point, a spectacular fail. Finally, companies that allow crypto to be folded into everyday experiences will attract big reactions from investors and customers alike. We don’t yet know which cryptocurrencies will be successful, but offering opportunities for people and society to advance their experience of them will win.
“Companies that allow crypto to be folded into everyday experiences will attract big reactions from investors and customers alike”
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Creating
RIPPLES IN THE FINANCE MARKET
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Digital foreign exchange and payment platform Bitpesa leverages blockchain settlement to lower the cost and increase the speed of business payments to and from frontier markets. Wendy Atkins talks to its founder and CEO, Elizabeth Rossiello
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³ƺɎɎǣȇǕ ɖȵ Ə ˡȇɎƺƬǝ ˡȸȅ ȅǣǕǝɎ ȇȒɎ ƫƺ ǔȒȸ Ɏǝƺ ǔƏǣȇɎٮǝƺƏȸɎƺƳً but as Elizabeth Rossiello, founder and CEO of BitPesa, says: “You have to keep going. Being an entrepreneur can be lonely, but you have to trust your judgement and be user-driven.” After working as a rating analyst with some of the biggest ȅǣƬȸȒˡȇƏȇƬƺ ǣȇɀɎǣɎɖɎǣȒȇɀ ƏƬȸȒɀɀ ɀɖƫٮ³ƏǝƏȸƏȇ ǔȸǣƬƏً Əɀ well as with investors such as Grameen Foundation, Gates Foundation and the Acumen Fund, Rossiello says she ɯǣɎȇƺɀɀƺƳ Ɏǝƺ ƳǣǔˡƬɖǼɎǣƺɀ ɎǝƏɎ ɀȅƏǼǼ ˡȇƏȇƬǣƏǼ ǣȇɀɎǣɎɖɎǣȒȇɀ ǔƏƬƺƳ ǣȇ ˡȇƳǣȇǕ ǼǣȷɖǣƳǣɎɵ ǣȇ ǼȒƬƏǼ ǔȸǣƬƏȇ ƬɖȸȸƺȇƬǣƺɀِ ³ǝƺ repeatedly saw funds and institutions having to exit the market because of FX loss or lack of local currency infrastructure. She was also working with regulators and ȵȒǼǣƬɵȅƏǸƺȸɀ Ȓȇ ǼƺǕǣɀǼƏɎǣȒȇ ǔȒȸ ˡȇƏȇƬǣƏǼ ǣȇȇȒɮƏɎǣȒȇɀِ In 2013, cryptocurrency had just started taking off and, she says, it was the right technology solution for this problem at the right time. As a result, BitPesa was launched as a digital foreign exchange and payment platform that leverages ƫǼȒƬǸƬǝƏǣȇ ɀƺɎɎǼƺȅƺȇɎ ɎȒ ɀǣǕȇǣˡƬƏȇɎǼɵ ǼȒɯƺȸ Ɏǝƺ ƬȒɀɎ ƏȇƳ increase the speed of business payments to and from sub-Saharan Africa and other frontier markets. It initially went to market in Kenya, in October 2013, with a simple Kenyan Shilling (KES) product. Since then, it has expanded to 15 markets and multiple product lines. Today, the company says that by offering a marketplace ǔȒȸ ǔȸǣƬƏȇ ˡƏɎ ƬɖȸȸƺȇƬǣƺɀ ƏȇƳ ƫǣɎƬȒǣȇً Ɏǝƺ ɀɎƏȸɎɖȵ ǝƏɀ cut transaction fees by 75% and reduced the transaction window from two weeks to two hours. Achieving this level of growth in such a short period of time hasn’t been without its challenges, particularly from incumbents and governments, which have not always been supportive of change. Rossiello says: “I’m part of a generation of pebble throwers, saying ‘what if we looked at something differently; what if we tried something new?’. And everyone tells me it’s hard and crazy, but I think it’s a worthy way to spend your life and your career.” She also explains the loneliness of life as an entrepreneur. “You have to keep trying to understand, is it lonely because you’re doing something wrong, and you’ve got to change what you’re doing? Or is it lonely because what you’re ƳȒǣȇǕ ǣɀ ɮƺȸɵً ɮƺȸɵ ȸǣǕǝɎّ çȒɖ ǝƏɮƺ ɎȒ ˡȇƳ ȒɎǝƺȸ ɯƏɵɀ ɎȒ check to make sure you’re on the right track. You should keep very close to the user, keep close to your team and keep your eye on the market.”
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“One of the things we are most proud of is becoming a market-maker for African currencies and really encouraging intra- and inter- Africa business”
«ȒɀɀǣƺǼǼȒ ƏƳƳɀ ٹ يɀ Ə ɀɎƏȸɎٮɖȵ ɯƺ ˡȇƳ ȒɖȸɀƺǼɮƺɀ ǝƏɮǣȇǕ ɎȒ ƺƳɖƬƏɎƺ ƏȇƳ ȸƺƏǼǼɵ ɯȒȸǸ ɯǣɎǝ partners to help them understand what the technology is. This has given us the opportunity to grow up very quickly and become a trusted source of information. The opportunity is there for the taking if you have the strength to do it.” BitPesa is working with banking partners and corporates that want to offer better services to their clients and to reach more customers in new segments. “One of the things we are most proud of is becoming a market-maker for African currencies and really encouraging ǣȇɎȸƏ ٮƏȇƳ ǣȇɎƺȸ ٮǔȸǣƬƏ ƫɖɀǣȇƺɀɀً ٺɀƏɵɀ «ȒɀɀǣƺǼǼȒِ ٹɖȸ ɮǣɀǣȒȇ ǣɀ ɀǣȅȵǼƺ يƏ ȅȒȸƺ ˡȇƏȇƬǣƏǼǼɵ ƏȇƳ commercially connected Africa. In order to keep up with and support Africa’s accelerating development, we cannot rely on just traditional infrastructure. Instead, we must create Ə ǝɵƫȸǣƳ ˡȇƏȇƬǣƏǼ ǣȇǔȸƏɀɎȸɖƬɎɖȸƺ ɎǝƏɎ ǣɀ ƫȒɎǝ ƏƬƬƺɀɀǣƫǼƺ ƏȇƳ ƺǔˡƬǣƺȇɎِ ǔȸǣƬƏ ǣɀ ȵǼƏɵǣȇǕ Əȇ increasingly pivotal role in the global economy and BitPesa seeks to empower businesses and entire markets at a level of macroeconomic engagement.” AUGUST 2018
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“Blockchain has the potential to provide a secure, easy and lowcost payment structure for Africa, exactly what BitPesa is doing with bitcoin currently”
Africa is a continent with very high business friction, something that BitPesa ƫƺǼǣƺɮƺɀ ƫǼȒƬǸƬǝƏǣȇ ƬƏȇ ɀǣǕȇǣˡƬƏȇɎǼɵ reduce. “Blockchain has the potential to provide a secure, easy and low-cost payment structure for Africa, exactly what BitPesa is doing with bitcoin currently,” says Rossiello. “It’s also a very versatile technology that entrepreneurs can create business models around at a relatively ǼȒɯ ƬȒɀɎ ǔȒȸ ƏǼǼ ǣɎɀ ƫƺȇƺˡɎɀِ “As the conversation of Open Africa looms larger, and other geopolitical factors come into play, there needs to be a private ecosystem that can support such changes. The applications are not just ǣȇ ˡȇƏȇƬƺً ƫɖɎ ǣȇ ǔȒȒƳ ɀƺƬɖȸǣɎɵً ǣƳƺȇɎǣɎɵ ɮƺȸǣˡƬƏɎǣȒȇ ƏȇƳ ȅƏȇɵ ȒɎǝƺȸ ȅƏɎɎƺȸɀ ɎȒ ƳȒ with transparency. Larger businesses can continue to innovate by partnering with blockchain players to ease payments and other sectors of the economy for the good
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of citizens in every country. The possibilities are limitless and interesting to observe.” Although many leaders in blockchain have come from the male-dominated ǣȇƳɖɀɎȸǣƺɀ Ȓǔ ˡȇƏȇƬƺ ƏȇƳ ɎƺƬǝȇȒǼȒǕɵً Ɏǝǣɀ is a new sector – one that is giving women an equal opportunity to assert their talent and abilities. Rosiello says, “I see my role as a woman in blockchain as having two ȵƏȸɎɀِ Áǝƺ ˡȸɀɎ ǣɀ ɎȒ Ǖǣɮƺ ȅɵ ȵƺȸɀȵƺƬɎǣɮƺ ǔȸȒȅ ɵƺƏȸɀ Ȓǔ ƺɴȵƺȸǣƺȇƬƺ ǣȇ ˡȇƏȇƬƺ ƏȇƳ in frontier markets, from both a technical and business angle. The second is to recruit more talented and ambitious women to Ɏǝƺ ˡȇɎƺƬǝ ɀƺƬɎȒȸِ “Our company is exactly 50% men and 50% women. Because we are dedicated to building a world-class team that can perform at the highest level across multiple geographies, we are committed to ensuring that the team meets our diversity AUGUST 2018
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standards. When we’re representing our customers, it’s so important to have a diverse team. There’s a lot of history on the continent of people who don’t look like their users making the decisions and, we’re trying very actively to buck that trend.” «ȒɀɀǣƺǼǼȒ ƏƳƳɀ ɎǝƏɎ ƫƺǣȇǕ Ə ɯȒȅƏȇ ǣȇ ˡȇɎƺƬǝ ǝƏɀ ȇƺɮƺȸ ƫƺƺȇ easy. “I try to surround myself with a team that understands that and works with me, and I look for partners that understand how to work with me and I actively meet female advisors and female investors. The treatment of men and women is absolutely not the same. It’s almost a bad joke in our company that our predominantly female senior executives can be joined by a junior male member of staff at a meeting with a partner, ƬɖɀɎȒȅƺȸ Ȓȸ ǕȒɮƺȸȇȅƺȇɎ ȒǔˡƬǣƏǼً ƏȇƳ ɯǝȒƺɮƺȸ ɯƺټȸƺ ȅƺƺɎǣȇǕ will speak only to the man. This has happened dozens of times, to the point that it’s part of our training now. “The same goes for investors who don’t believe what you’re saying until they talk to a junior male colleague. It takes us back to how people have an inner bias and how they hear voices that sound like their own – and that’s why some people don’t do business in these markets, because they don’t recognise anybody who sounds like them in those places.” Does Rossiello have any advice for female would-be entrepreneurs? “Persist – and realise that what you’re doing is not for nothing. Seek out other females – female advisors, female partners. Go with an all-woman team, don’t go with an all-male team; don’t give them what they want. Learn how to speak to customers, governments and partners, and make them understand that they’re in front of a woman with a technical answer. Don’t let it get to you. When you’re trying to change something, it’s going to be hard. One of my early investors said ‘it’s like a toothache – it hurts like hell, but it won’t kill you’.”
AUGUST 2018
BitPesa recognises the importance of building a diverse team, ensuring women have an opportunity to show their talent and abilities in the fintech sector
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Rising to the challenge Peer-to-peer lending pioneer Zopa recently announced plans to build on its success by launching its own digital bank, joining the increasing ranks of challengers to the established banking heavyweights
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If you’ve shopped around for a personal loan in recent years, there’s every chance you’ve looked beyond long-standing sources of lending for a more competitive offer, even in these days of historically low interest rates. Among these new options, peer-to-peer (P2P) lending has developed into a popular and attractive choice for securing funds. Such services began life in the UK, when Zopa became the first-ever peer-to-peer lending company, launched by a team from internet banking company Egg in March 2005. In January 2017, Zopa became the first UK-based P2P company to lend more than £2 billion in loans. Now, the company is set to launch its own banking offshoot, expanding the range of financial products it offers to UK consumers and promising to “create a set of products that customers can feel good about, with no catches on rates or charges, no hassle to use or understand and which cater to the needs of new and existing customers in a fast-changing market”. So how will this new bank challenge the traditional players in the market? We asked Zopa’s Chief Customer Officer, Clare Gambardella, to tell us more.
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W
hat initiated the development of Zopa’s new bank?
Over the past 13 years, we’ve ƫɖǣǼɎ Ə ȵȸȒˡɎƏƫǼƺً ɀƬƏǼƏƫǼƺ ƏȇƳ ɮǣƏƫǼƺ business that has lent out over £3.5 billion worth of personal loans to UK consumers. In that time we’ve built up an excellent track record in prudently managing risk and seamlessly originating high-quality loans online. In 2017 alone, we lent nearly a billion pounds to low-risk UK customers by offering a better-value product and a better experience – an ethos we’ve lived by since 2005.
Having globally pioneered the P2P lending model, we wanted to extend our product ȒǔǔƺȸǣȇǕ ǣȇ ȒȸƳƺȸ ɎȒ ȅƺƺɎ Ɏǝƺ ˡȇƏȇƬǣƏǼ needs of even more people in the UK. Launching a bank allows us to do this and is a natural route to our goal of making Zopa the best place for money. What services and facilities will the new bank provide? At launch, we plan on offering FSCS [Financial Services Compensation Scheme]protected savings accounts for savers and credit cards for people looking to borrow. These will sit alongside out current product portfolio of P2P investments, including IFISAs [Innovative Finance Individual Savings Accounts] for investors, personal ǼȒƏȇɀ ƏȇƳ ƬƏȸ ˡȇƏȇƬƺِ ɀ Ɏǝƺ ȵƺȇ ƏȇǸǣȇǕ initiative rightfully puts customer data back into the hands of customers, we will also offer consumers a more personalised approach to money management. What will Zopa’s bank offer that current banks cannot? How will it compare to other digital banks? Xȇ ȸƺƬƺȇɎ ɵƺƏȸɀً ɎƺƬǝȇȒǼȒǕɵ ǝƏɀ ȸƺƳƺˡȇƺƳ what customers have come to expect from their banks. Rising consumer expectations have meant that many existing retail banks have found it hard to keep up. At Zopa, we believe we can offer better customer service, fairer products and a forward-looking approach that changes and evolves with our customers.
Clare Gambardella Chief Customer Officer
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It’s great that other digital banks are improving choice for customers and challenging the way the industry operates. We combine the agility of these players with a strong track record, existing scale and a proven business model. Will this be a challenger bank, or in partnership with an existing bank? We will remain independent of other banks. Our banking business will sit alongside our existing P2P business. In what areas does Zopa hope to improve in the digital banking sector and the P2P industry? Zopa’s aim is to improve how customers feel ƏƫȒɖɎ Ɏǝƺǣȸ ˡȇƏȇƬƺɀً ȸƺƳɖƬǣȇǕ ɀɎȸƺɀɀ ƏȇƳ anxiety, being transparent and clear, and providing service as they want it. We want to provide people with better ƬȒȇɎȸȒǼ Ȓɮƺȸ Ɏǝƺǣȸ ˡȇƏȇƬƺɀً ǣȇ ȵƏȸɎǣƬɖǼƏȸ through our money management app and Open Banking, which will give customers more choice over how they manage their money.
IN NUMBERS
£3.5 BILLION Amount loaned by Zopa to UK customers since 2005
9 YEARS voted as MoneyTransfer's Top Loan Provider
60,000 Number of active individual investors
311,000 Number of approved borrowers
Did you know? Zopa stands for ‘zone of possible agreement’ – a term identifying the bounds within which agreement can be reached between two parties
AUGUST 2018
£44 MILLION Amount raised in funding round for Zopa’s bank, completed in August
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Gold DISRUPTION BANKING
RETURN TO THE
standard
Innovative startup Glint aims to create a modernday gold rush by making it easier for to acquire the precious metal and turn it into a payment method
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P
loughing funds into a plethora of cryptocurrencies may be all the rage among the more adventurous of investors, many of whom are either keen to make a quick buck from a trend of rapid increases in value or looking to spread their portfolio to reduce the risk of any future economic turbulence – or both. Traditionally, gold has been the safe haven for those wary of choppy economic waters ahead, but also an investment limited to those with ɀǣǕȇǣˡƬƏȇɎ ǔɖȇƳɀ ɎȒ ƳǣɮƺȸɎِ
the UK pound and the looming threat of a ǕǼȒƫƏǼ ˡȇƏȇƬǣƏǼ Ƭȸǣɀǣɀ ɎȒ ƬȒȅȵƏȸƺ ɯǣɎǝ ɎǝƏɎ experienced a decade ago. Glint also cites widespread distrust in banks and rising global debt as contributing factors to the growing traction for gold as currency.
However, one startup is enabling the average consumer to acquire the precious metal – and use it to make purchases. Enter Glint – a service that reintroduces gold as money, bringing the world’s oldest currency into the modern era as more than just an investment commodity.
Glint’s USP is that it offers an e-payment card backed by physical gold, which historically has a better storage value compared with any other currency. The UK’s Lloyds Bank acts as the deposit holder for customers storing money on the Glint app. Users can buy gold via the app – when they select this option, they purchase a portion of a gold bar that is stored in Swiss vaults.
When Glint launched in the UK and Europe late last year, its founding mission statement was to make money fairer. The British startup ǣƳƺȇɎǣˡƺƳ ǣȇǝƺȸƺȇɎ ɖȇǔƏǣȸȇƺɀɀ ǣȇ Ɏǝƺ depreciation of money and set out to provide a solution. Glint’s founders assert that gold is the most reliable form of money, highlighting issues with paper money such as the recent depreciation of
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As Jason Cozens, chief executive and cofounder of Glint, told the Financial Times, “Everyone is familiar with gold as one of society’s oldest means of exchange, its universal acceptance, its reliability, its history as a store of wealth and as a means of underpinning ‘paper’ currencies. Unlike paper currencies, gold can’t be wiped out, devalued or corrupted.”
When the account holder wants to pay a bill, he or she can choose to pay in conventional currency or link the Glint MasterCard payment card to their gold account. With the latter option, the merchant receives the currency equivalent of the gold worth, which is calculated at the current market rate.
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Glint offers an e-payment card backed by physical gold, with an app that enables users to buy the commodity and check their current balance, calculated at the market rate
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There is an argument that gold should be used as a store of value – as traditional investments in gold have been long-term, and for funnelling spare cash into long-term gold investments – rather than short-term ƺɴƬǝƏȇǕƺɀً Ǖǣɮƺȇ Ɏǝƺ ˢɖƬɎɖƏɎǣȇǕ ȵȸǣƬƺ Ȓǔ gold over the past few decades. Despite these caveats, Glint is growing. As of mid July, Glint had registered almost 10,000 full users and more than 16,000 registered users. The app is backed by investors in the UK, continental Europe, Canada and Japan – including the Tokyo Commodity Exchange and NEC Capital Solutions – and is authorised and regulated by the UK’s Financial Conduct Authority (FCA). It has raised millions through its promise of a new global currency, with major individual backers, including former CEO of the World Gold Council Haruko Fukuda; 79 former chairman of Goldman Sachs Asset Management Asia Oliver Bolitho; co-founder of asset manager Sloane Robinson Hugh Sloane, and Lord Flight of Worcester, formerly of Guinness Flight Global Asset Management. Gold
Glint was rolled out across Europe last November, with plans to enter Asia and the United States in the near future. By the end of next year, the startup is targeting well over half-a-million new customers, many of whom are expected to reside in Asia and Latin America. Glint believes its greatest growth potential exists in territories where gold is traditionally held in high value – such as India, Singapore, Hong Kong and countries across the Middle East and North Africa (MENA) region. In July, Glint launched an equity crowdfunding campaign on Crowdcube to raise £1,250,000 as part of its Series A round to fund further expansion. Since its seed investment, the company has quadrupled in value and has already passed its launch acquisition and AUM (assets under management) targets.
2 8 1 8 32 1 8 1
Glint has scalability in mind, having built a technology platform and established multicurrency wallets that will enable it to grow. July also saw Glint release its Android app and begin the rollout of multiple additional currencies. By the end of this year, users will be able to hold and spend Canadian dollars, Japanese yen and Hong Kong dollars, in addition to gold, sterling, euros and US dollars.
Au
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Since its seed investment, the company has
The company acknowledges that the development of global distribution partnerships is critical to its growth.
quadrupled in value 32
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Glint has already signed two strategic deals in the US, giving it a reach of more than 40 million people, as well as brand extension assets and local expertise. There are further plans to maximise its partnerships, develop new deals, launch across international markets and continue along its development roadmap. Glint has been hailed as the ȇƺɴɎ ˡȇɎƺƬǝ ɖȇǣƬȒȸȇً ȒǔǔƺȸǣȇǕ ɀƺȸɮǣƬƺɀ ɎǝƏɎ ƳǣɀȸɖȵɎ ɎȸƏƳǣɎǣȒȇƏǼ ˡȇƏȇƬǣƏǼ ȅƏȸǸƺɎɀِ Co-founder Ben Davies has said that, in broadening access to gold among the general public, the app is helping to “democratise” the commodity. Gold is no longer a preserve of the wealthy – it is ˡȸȅǼɵ ƫƏƬǸ ǣȇ ǔƏɀǝǣȒȇً ƏȇƳ Ɏǝƺ ƬȒȅȵƏȇɵټɀ founders maintain that is no longer necessary to buy large quantities as an investment. Whatever your stance, it’s clear that Glint is contributing to a shift in global perception surrounding gold. It is now a commodity that, at present, can be spent more readily than many cryptocurrencies, which have been dominating headlines in recent years.
AUGUST 2018
Riding this wave of success and interest, Glint is scaling its platform and pushing ahead with regional expansion plans. According to Cozens, the next steps for Glint are to build up the opposite side of the network, by enabling clients and merchants to receive payments in gold.
By the end of this year, users will be able to hold and spend Canadian dollars, Japanese yen and Hong Kong dollars, in addition to gold, sterling, euros and US dollars
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More than just an island for sun-seeking holidaymakers, Malta is building on its reputation as a hub for e-gaming and setting out its stall as a prime location for fintech innovation
Y
Ȓɖ ɯȒɖǼƳ ƫƺ ǔȒȸǕǣɮƺȇ ǣǔ ɵȒɖȸ ˡȸɀɎ ɎǝȒɖǕǝɎɀ ƏƫȒɖɎ Ɏǝƺ island of Malta are of sun, sand and sea, but beyond the sandy beaches and year-round balmy weather lies a strong tech pool and a state-of-the art infrastructure. Much of this was achieved through government ǣȇǣɎǣƏɎǣɮƺɀ ɎǝƏɎ ȵȸȒȅȒɎƺƳ ƺȇɎȸƺȵȸƺȇƺɖȸǣƏǼ ˢƺɴǣƫǣǼǣɎɵ ƏȇƳ a willingness to accommodate new sectors looking to develop, in an ƺǔǔȒȸɎ ɎȒ ǕƺȇƺȸƏɎƺ ˡȇƏȇƬǣƏǼ ɀɎƏƫǣǼǣɎɵ ɎǝȸȒɖǕǝ ǣȇƬȒȅƺ ƳǣɮƺȸɀǣˡƬƏɎǣȒȇِ Such policies made Malta a favourite with growth-minded companies and emerging tech industries, such as online gaming and gambling.
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Binance announced in March that it would support Malta’s goal to become ‘Blockchain Island’ by opening new offices, starting a mentorship programme and creating hundreds of job opportunities
Malta's bet on the e-gaming industry during the late 1990s proved to be a ȵȸȒˡɎƏƫǼƺ Ȓȇƺِ ɵ ǕǣɮǣȇǕ ɵƺɎٮɎȒٮƫƺٮ regulated operators the chance to enter the online market, the island attracted a ˡȸɀɎ ɯƏɮƺ Ȓǔ ǔȒȸƺǣǕȇ ǣȇɮƺɀɎȅƺȇɎ ƏȇƳً ɯǝƺȇ its Remote Gaming Regulations were ˡȇƏǼǼɵ ǣȇɀɎƏɎƺƳ ǣȇ ًגאxƏǼɎƏ ƫƺƬƏȅƺ Ɏǝƺ 0ɖȸȒȵƺƏȇ ÈȇǣȒȇټɀ ˡȸɀɎ ƏȇƳ ȒȇǼɵ ǼǣƬƺȇɀƺƳ state for e-gaming. In spite of its modest size – the island is just over 316 sq km in area, with fewer than one million habitants – Malta became a hub for tech-centric ˡȸȅɀ ǣȇ ǕƏȅǣȇǕ ƏȇƳ ǕƏȅƫǼǣȇǕِ From betting services such as Unibet to fantasy sport entities, including Pinnacle ³ȵȒȸɎɀً ˡȸȅɀ ǔȸȒȅ ƏȸȒɖȇƳ Ɏǝƺ ǕǼȒƫƺ migrated to the sole gaming jurisdiction in the world’s largest single market. Notable ˡȸȅɀ ƏȅȒȇǕ Ɏǝƺ ˡȸɀɎ ɀƺɎɎǼƺȸɀ ǣȇƬǼɖƳƺƳ PaddyPower Betfair – a merger between two of the best-performing gambling companies, with a combined market capitalisation in excess of £5 billion – and DraftKings, the American fantasy
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sports giant that was valued at $2 billion within three years of its formation. Many of Malta’s new businesses grew from small startups to million-dollar enterprises, and began to not only create prototypes, but also acquire the most promising competitors in their niche. This freed up a talent pool of freshly minted tech entrepreneurs to think up of new ways of ƳǣɀȸɖȵɎǣȇǕ Ɏǝƺ ȅƏȸǸƺɎِ !ɖɎɎǣȇǕٮƺƳǕƺ ˡȸȅɀ such as LeoVegas, Casumo and fantasy football platform Oulala were subsequently created and launched from Malta, further strengthening the cycle of talent attraction, tech discovery and revenue generation. By 2017, Malta was housing nearly 300 licenced tech companies. Among the most successful were game developers such as Gaming or Play’n’Go, as well as ǝɵƫȸǣƳ ˡȸȅɀ ɎǝƏɎ ƬȒȅƫǣȇƺƳ ǕƏȅǣȇǕ ɯǣɎǝ newly developed technology. Today, the nation’s e-gaming industry is valued at $1.4 billion and contributes
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around 10% of Malta’s GDP. The result is prosperous and tech-forward cities with tens of thousands of skilled staff – perfect ingredients for future tech industries, and an answer to the question why the small ǣɀǼƏȇƳ ɯƏɀ Ȓȇƺ Ȓǔ Ɏǝƺ ˡȸɀɎ ɎȒ ȒȵƺȇǼɵ ȸƏǼǼɵ for the development of digital currencies, cryptos and blockchain. As other countries hestitated to embrace these disruptive technologies, Malta welcomed them with thought-leadership conferences and relocation packages. áǣɎǝǣȇ ɀǣɴ ȅȒȇɎǝɀً Ə ˡȸɀɎ ƬȒȇǔƺȸƺȇƬƺ Ȓȇ blockchain and crypto were setup. Within ten, three more. In 2016, Malta’s Minister of Economic and Financial Affairs announced plans to “transform Malta into an economic superpower in the emerging crypto-economy” by doing the groundwork necessary to create a regulatory framework strong enough to support what would be exciting, ɵƺɎ ƳǣǔˡƬɖǼɎً ǕȸȒɯɎǝ ȵƺȸǣȒƳɀِ Áǝƺ ȵȒɀǣɎǣɮƺ news brought some of the biggest and largest in the industry to Maltese shores.
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Binance, the world’s largest cryptocurrency exchange, has arguably made the biggest ǝƺƏƳǼǣȇƺɀِ Áǝƺ ˡȸȅ ƏȇȇȒɖȇƬƺƳ ǣȇ xƏȸƬǝ that it would support Malta’s goal to become ٻǼȒƬǸƬǝƏǣȇ XɀǼƏȇƳ ټƫɵ ȒȵƺȇǣȇǕ ȇƺɯ ȒǔˡƬƺɀً starting a mentorship programme and creating hundreds of job opportunities.
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In 2016, Malta’s Minister of Economic and Financial Affairs announced plans to “transform Malta into an economic superpower in the emerging crypto-economy”
ñ ِƬȒȅً Ɏǝƺ ɯȒȸǼƳټɀ ˡǔɎǝٮǼƏȸǕƺɀɎ ƬȸɵȵɎȒƬɖȸȸƺȇƬɵ exchange, which averages $400 million in crypto transactions a day, has also made public ǣɎɀ ǣȇɎƺȇɎǣȒȇ ɎȒ ȸƺǼȒƬƏɎƺِ IȸȒȅ ȒǔˡƬƺɀ ǣȇ ³Ɏ hɖǼǣƏȇټɀ
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ZB.com will create 150 jobs and invest $20 million during the first three years of operation
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– Malta’s second business hub after its ƬƏȵǣɎƏǼً àƏǼƺɎɎƏ ٫ Ɏǝƺ ˡȸȅ ɯǣǼǼ ƬȸƺƏɎƺ ד ǴȒƫɀ ƏȇƳ ǣȇɮƺɀɎ אڟȅǣǼǼǣȒȇ ƳɖȸǣȇǕ Ɏǝƺ ˡȸɀɎ three years of operation. “Malta is perhaps the world’s most progressive and forward-thinking nation ǣȇ (nÁً ƬȸɵȵɎȒ ƏȇƳ ˡȇɎƺƬǝً ƏȇƳ ɯƺ Əȸƺ ɮƺȸɵ excited to be part of the Blockchain Island,” remarked ZB.com co-founder Jimmy Zhao. Crypto exchanges are being joined by players in blockchain, virtual reality and ƏȸɎǣˡƬǣƏǼ ǣȇɎƺǼǼǣǕƺȇƬƺً ǣȇƬǼɖƳǣȇǕ ƺȷɖǣɎɵ fundraising platform Neufund, bitcoin payment processor BitPay and blockchainbased global mobile-phone network YOVO. The state of Malta is helping to create a healthy environment for startups by ǣȇɮƺɀɎǣȇǕ ǣȇɎȒ ƬȒǼǼƏƫȒȸƏɎǣɮƺ ɀǝƏȸƺƳ ȒǔˡƬƺ spaces to encourage quick development, creativity and community-led innovation. xƏǼɎƏ ƏǼɀȒ ǝƏɀ ɀƺɮƺȸƏǼ ƳƺƳǣƬƏɎƺƳ ˡȇɎƺƬǝ hubs, including a business incubator at the University of Malta, an innovation-focused hub at the Malta Information Technology ǕƺȇƬɵً Ə ˡȇɎƺƬǝ ɀƏȇƳƫȒɴ ƏɎ Ɏǝƺ xƏǼɎƺɀƺ Stock Exchange, and Malta Digital Hub at Malta Life Sciences Park. Plans have been made for an additional hub – a state-of-the-art technology park ǔȒȸ ɀƺɮƺȸƏǼ ǝɖȇƳȸƺƳ ˡȸȅɀ ɎǝƏɎ ǣɀ ƺɴȵƺƬɎƺƳ to open in 2021. The island also offers ǣȇƬƺȇɎǣɮƺɀ ɀɖƬǝ Əɀ ƳǣɀƬȒɖȇɎɀ Ȓȇ ȒǔˡƬƺ ɀȵƏƬƺ ƏȇƳ ɎƏɴٮƫƺȇƺˡɎ ȵƏƬǸƏǕƺɀ ǔȒȸ ƫȒɎǝ ˡȸȅɀ ƏȇƳ ǝǣǕǝٮǼƺɮƺǼ ˡȇɎƺƬǝ ȵȸȒǔƺɀɀǣȒȇƏǼɀِ
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Áǝƺ ǣɀǼƏȇƳټɀ ˡȇɎƺƬǝ ƬȸƺƳƺȇɎǣƏǼɀ ɯǣǼǼ ƫƺ further enhanced when it hosts the inaugural Malta Blockchain Summit, which takes place on 1 and 2 November 2018 in St Julian’s. The event incorporates four conferences and is expected to attract as many as 4,000 delegates, with proceedings ƫƺǣȇǕ ȒǔˡƬǣƏǼǼɵ ȒȵƺȇƺƳ ɯǣɎǝ Ə ɀȵƺƺƬǝ ƫɵ Prime Minister Jospeh Muscat. The Summit will also feature a hackathon, as well as an ICO pitch comprising hundreds of investors. This event will be preceded by the Blockchain & Bitcoin Conference Malta, also being held in St Julian’s, on 23 October, which brings together nearly 40 experts from 10 countries for a one-of-a-kind networking opportunity.
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The island offers incentives such as discounts on office space and tax-benefit packages for both firms and high-level fintech professionals
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