Fasanara Fintech Weekly

Climate Fintech, China's Bank Digital Currencies, Spending More with BNPL, UK Big Bang & Other News



Happy Friday!



At this blogpost:


  • UK seeks fintech ‘big bang’

  • Climate Fintech Is Coming

  • Ten-year Treasury yield catching up to S&P 500 dividend

  • Attest Research Finds New Regulation Preventing BNPL Debt Could Lead to Consumers Spending More

  • China's Central Bank Joins Cross-Border Digital Currency Pilot




UK seeks fintech ‘big bang’



Finance and technology go hand in hand in creating successful business environments, as the venture capitalists and tech entrepreneurs of Silicon Valley will testify.

With the UK losing trading business to the EU this year due to the lack of a services Brexit agreement, there is pressure to make London a global Spac centre, while Kalifa report on UK fintech aims to maintain Britain’s advantage in combining technology with financial services.

Investment is one key point in a five-point plan, with US and Silicon Valley-style funding and entrepreneurial incentives emphasised. The review calls for an expansion of R&D tax credits, the Enterprise Investment Scheme and Venture Capital Trusts. A £1bn “Fintech Growth Fund” is suggested, along with improvements to the listing environment through less of a free float being allowed, along with dual class shares and the relaxation of pre-emption rights. A family of fintech indices would enhance the sector’s visibility, it advises. Such steps are seen as urgent, with some of Britain’s most promising tech businesses considering US stock market listings.


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Climate Fintech Is Coming



What do you get when you combine the buzziest tech sector with the most high-profile public policy issue? Financial technology combating climate change.


It would seem an unlikely pairing, but the last year witnessed an explosion in climate-focused fintech products and companies. The public’s focus on climate change is here to stay, which could continue to spur more exciting innovation in financial services focused on creating a greener world. It remains to be seen whether these products can generate a meaningful return (and thus merit continued investment), but this will be a common theme over the next year and beyond.

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Ten-year Treasury yield catching up to S&P 500 dividend



(Reuters) - A historically hefty advantage that the S&P 500 dividend yield has held over the benchmark U.S. Treasury note is on the verge of disappearing, a year after the collapse in interest rates set the stage for Wall Street’s recovery from the pandemic sell-off.


Investor concerns that measures to restore a U.S. economy hammered by the global pandemic could also spark inflation lifted the yield on the 10-year note as high as 1.394% overnight, the highest since February 2020.


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Attest Research Finds New Regulation Preventing BNPL Debt Could Lead to Consumers Spending More



Latest research from consumer research platform, Attest, shows that new regulations preventing Buy Now, Pay Later (BNPL) debt could lead to consumers spending more.


The Attest study, which interviewed 1,000 BNPL users in February 2021, reveals that almost 49% of UK citizens that have used a BNPL service in the past 12 months stated they would spend more using BNPL knowing that credit checks had taken place and with more transparency as to affordability.


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China's Central Bank Joins Cross-Border Digital Currency Pilot



China's central bank will join a project looking at using central bank digital currencies (CBDC) for cross-border payments.


CBDCs are like banknotes or coins and give holders a direct claim on the central bank, potentially leapfrogging commercial banks.


Observers globally are watching the e-CNY closely, interested in both lessons they can learn and whether and how the PBOC tries to use it to internationalise the yuan, a long- standing ambition of Chinese authorities.


The project aims to develop a process for real-time cross-border foreign-exchange payments on distributed ledger technology, which underpins cryptocurrencies such as bitcoin.


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