B2B Payments

Bank-FinTech Tie-Ups Continue Despite SMB Skepticism

While Open Banking initiatives and data integrations between banks and FinTech firms have begun to target corporate and small business (SMB) end users, new research out of the U.K. has warned that small businesses are largely shunning the opportunity to unlock their financial data. In a recent report from the U.K. Federation of Small Businesses (FSB), research of 1,000 small business owners revealed that fewer than one in seven SMBs are sharing their bank data with third-party service providers.

“We’re two years on from the introduction of Open Banking, but very few small firms have reaped any benefit from it,” warned FSB Chairman Mike Cherry in a statement, noting a general distrust of the banking industry as one factor behind the lack of SMB Open Banking adoption. “The financial crash casts a long shadow. A lot of small business owners still don’t trust lenders to do the right thing.”

Indeed, about 40 percent of small businesses said they believe data sharing is unsafe, while more than 33 percent said they are unaware of the benefits of data sharing. According to Cherry, in addition to reassuring small business clients of the security of their application programming interface (API) data integrations, banks and FinTech firms must boost awareness among their SMB clients about the benefits that data sharing can offer.

While small businesses may be unaware and even distrusting of Open Banking, this week’s look at the latest in bank-FinTech data integrations has revealed that the industry continues to embrace data connectivity for the benefit of business end users, with partnerships as one way to improve awareness.

HSBC Targets Treasurers With APIs

U.K. financial institution HSBC recently debuted a suite of APIs for corporate treasurers to integrate payments functionality within their existing back-office platforms.

In an announcement, HSBC revealed the launch of its Treasury APIs for corporate clients across 27 markets. Focusing on integrations with ERP, treasury management and other systems, the APIs allow treasurers to initiate payments from within their existing platforms, with support for real-time payments and single or bulk payments. HSBC also noted that the integrations support heightened visibility into the status of a transaction, both for the sender and beneficiary.

“APIs are the future of corporate-to-bank connectivity, and we are excited to be putting clients at the center of new developments to help them run and grow their business,” said HSBC Head of Digital, Global Liquidity and Cash Management Nadya Hijazi in a statement.

Open Banking Startup Lands $99.9 Million

Dawn Capital, HMI Capital and Insight Partners co-led a $99.9 million funding round for Sweden-based Open Banking platform Tink, according to reports on Monday (Jan. 20).

The company offers a platform for banks and customers across Europe to support data integrations between banks and FinTech firms. With existing customers that include PayPal, Klarna and NatWest, Tink uses its API to unlock aggregated financial data for banking clients and their customers to support enhanced financial management.

Tink said it plans to deploy the new funding to continue expanding across Europe, with Dawn Capital General Partner Josh Bell pointing to the proliferation of Open Banking throughout the globe.

“As the world of banking undergoes a fundamental shift, from analog to digital and from closed to open, banks and financial services require a new set of technical foundations on which to build a winning product strategy for the coming decades,” he stated.

NatWest Adds Loans To SMB Cards

Also in the U.K., NatWest has announced a FinTech collaboration with small business prepaid corporate card company Soldo. Their partnership will connect Soldo’s SMB users to small business loans from NatWest via its Esme Loans and Rapid Cash services, which connect businesses to credit lines to finance unpaid invoices.

“As one of the U.K.’s biggest banks for [SMBs], we’re extremely keen to work with anyone that offers a unique, simple experience that makes it easier for our customers to run and grow their business[es],” said NatWest Head of Ventures Andrew Ellis in a statement. “Soldo is a partner [that does] exactly that, whilst sharing our passion to do things differently for U.K. [SMBs]. We’re thrilled to be working with them.”

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LATEST PYMNTS REPORT: B2B API TRACKER 

Social distancing has changed eCommerce from a ‘want to have’ to a ‘must have’ for businesses, yet retailers could struggle to create convenient payment and refund experiences for their apps and websites, says Abdul Raof Latiff, head of DBS Bank’s digital institutional banking group. In the April 2020 B2B API Tracker, Latiff explains how banks can provide a timely assist via application programming interfaces (APIs) that integrate payments into those eCommerce platforms.

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