April was an eventful month for fintech, and there was a wave of new developments in the payments space. To stay in the loop with the latest payments updates in the dynamic and fast-paced sector, here are the most pressing updates in payments from April
2024.
As well as an influx of new developments in the world of payments, April also saw to Finextra’s annual
NextGen Nordics conference that took place in Stockholm. The event covered new developments, regulation, challenges, and opportunities in the Nordic payments sector. To see top Nordics payments stories that took place this year, check out our story on it
here.
UK Open Finance task force announced at IFGS
At ifgs in London 2024, UK government economic secretary to the treasury, Bim Ofolami, announced the formation of an Open Finance task force.
The task force will concentrate on bolstering the fintech community and drive Open Finance in the UK payments sector. The
Centre of Finance, Innovation, and Technology (CFIT) published a Blueprint report recommending the task force earlier this year, and will chair the Open Finance task force.
An Open Finance task force would revolutionise the UK payments industry by accelerating the impact of Open Finance on financial institutions that operate in the UK.
Klarna makes moves
Swedish buy now pay later (BNPL) firm Klarna sold Hero, a virtual shopping platform that it bought in 2021 to Bambuser in a €1.3 million deal.
Klarna also announced that it would be issuing a
Klarna Card to US customers, with the waitlist now open so those who would like to use Klarna’s flexible payment options will soon be able to do so in the US for any purchase where Visa is accepted.
Klarna also struck a
global payment deal with car-ride app Uber and set to
expand its partnership with Expedia in the US.
Variable recurring payments set to launch in UK
UK Finance and law firm Addleshaw Goddard has set up model clauses for variable recurring payments (VRPs) that allow users to authorise payments initiated from payments providers from their bank accounts on an ongoing basis, with time and amount within limits.
UK regulators agreed to roll out Phase 1 of non-sweeping VRPs in the third quarter of 2024.
Central banks band together to investigate tokenisation for cross-border payments
Seven central banks have joined together in a project towards programmable tokenisation of cross-border payments, working with the Bank of International Settlements. The objective of the initiative is to make international transactions faster and cheaper,
and the project is aiming to enhance the monetary system by exploring the possibilities of tokenised commercial bank deposits.
Banks involved in the initiative are the Bank of France, Bank of Japan, Federal Reserve Bank of New York, Bank of Korea, Bank of Mexico, Swiss National Bank, and the Bank of England.
Quantum-safe cryptography in the works
The Emerging Payments Association Asia has established a working group to investigate the adoption of quantum-safe cryptography in the payments sector. The aim of the group is to explore the potential risks that quantum computing brings into payments and
how cryptography can protect future transactions.
HSBC, PayPal, IBM, and Australian Payments Plus are founding members of the group.
Fintech funding in a slump
Fintech funding has hit its lowest mark since 2017 this year, with Q1 of 2024 seeing a decline in fintech investment. Startups in 2024 have raised £7.3 billion, the lowest figure since 2017.
While the fintech sector is still growing, it is at a slower rate than previous years and we have yet to see if it sets the tone for the rest of 2024.