Implementing the right digital onboarding solution is a crucial step in securing clients looking for modern banking solutions. BankLaunch provides the right tools to stand out in the FinTech world.
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The business events used to gather thousands of people related to a specific topic at one place. Crowded conference halls, exhibition stands, handshakes, business card exchanges, and networking cocktails were essential tools for establishing a business deal and partnership. But traveling, mass gatherings and personal meetings are minimizing due to the circumstances in 2020. Everything is moving to an online format, so do the business events. Moreover, the good old conferences are renamed to “offline events”.
Many people are skeptical towards adaptations to the new online conferences because of the belief that virtual meetings can not replace real-life encounters. For BankLaunch, it is essential to keep the connection with the movers and shakers of the financial industry. Therefore we have decided to actively participate in leading fintech events, regardless of the format.
One of the events that found a model of successfully engaging the community is Finfellas. It is a series of monthly events focusing on alternative finances. The Finfellas audience keeps growing because of a good balance of quality content and 1on1 networking. Previously events were talking about Fintech Regulations and P2P lending. This month’s edition is dedicating to insights about lending in real estate.
We invite our clients, partners, and followers to join the Finfellas Real Estate Lending event on January 28-29th 2021. Especially because the participation in the event is free of charge. BankLaunch’s booth will be showing the P2P module and its application for real estate financing. It is the place to be if you are planning on starting your own real estate investing platform.
On top of it, the speakers at the event are Nikita Goncars (LendSecured), Edgars Ivanovs (Twino Ventures), Janis Timma (Crowdestor), Tanel Orro (Reinvest24), Jatin Ondhia (Shojin Property Partners), Martynas Stankevicius (Röntgen), Narinder Khattoare (Kuflink), Igors Puntuss (Bulkestate), Jan Angel (Max Property Group / Max Crowdfund), Juancho Arregui (Brickfy), David Bradley-Ward (Ablrate), Jan Vecerka (BrikkApp), Tobias Lindner (P2P Lending at its Best) and Lars Wrobbel (Passives Einkommen mit P2P).
The collaboration of GetID and BankLaunch enables to fintech startups a great customer onboarding experience with all-in-one solution for customer verification and compliance checkup.
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Integration of remote customer onboarding, document verification, electronic signature, AML screening and compliance checkup tools for banks and fintech.
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Integrated solutions for fintech. BankLaunch and DECTA offer the perfect business solution for launching self-branded payment cards.
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BankLaunch has just joined the Latvian Startup Community. Startin.Lv. Startin.Lv – What it is and how it can be beneficial to BankLaunch’s development.
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How much do you know about Latvia’s license requirements for peer-to-peer platforms? What would your crowdfunding startup need to do to get established? Keep reading, and you’ll learn how to launch in no time.
Why Peer-to-Peer Platforms?
Peer-to-peer (P2P) platforms are highly sought-after for several reasons. They allow clients to invest in many different projects. These include new businesses, real estate, and lending ventures.
P2P platforms tend to result in very high returns. Investors can benefit from an ROI of more than 10% per annum. Standard bank deposits provide nowhere near this amount.
Disadvantages of P2P
Unfortunately, there are also drawbacks to peer-to-peer lending platforms. These sites typically involve significant risk.
The client can lose money if something happens to the service. Shuttered investment platforms led to significant losses for customers in the first few months of the year.
In the case of Envestio, investors forfeited a total of about 31 million Euros. The site is no longer online. Kuetzal is another platform that completely disappeared, along with clients’ money. The consensus in the investment world is that both were probably scams.
Grupeer also announced financial difficulties and didn’t return what customers had contributed. The platform cited the COVID-19 crisis as the reason for its shutdown, saying the business couldn’t continue due to delayed loan repayments in multiple countries. Investors are currently pursuing a joint lawsuit.
Things Are Looking Better
While the beginning of 2020 brought bad news in P2P lending, the scenario is starting to improve. It seems the worst of the financial crisis has passed. Some platforms announced that August was the most productive month of the year.
PeerBerry reported 19% more loans funded in August than in the previous month. While the pandemic hasn’t gone away, individuals and businesses are now less alarmed than before: they’re starting to have the confidence to invest once again.
PeerBerry and Mintos are launching new products. The former introduced more stable long-term loans and is working toward allowing clients to fund several investments at a time.
Mintos is developing new strategies to meet customer needs. It gives clients the choice of diversifying, increasing yields, or sticking with a more conservative portfolio. These new investment products are a clear sign that P2P popularity and innovation potential are back on track.
Peer-to-Peer Platforms in Latvia
Latvia is home to many successful P2P lenders, including Mintos and PeerBerry, mentioned earlier. Twino, Viventor, and VIAINVEST are also based here.
The high concentration of these services in Latvia is no coincidence. Riga, the capital, is a financial hub for P2P platforms, does its best to attract new operators, and is thus a viable option for newcomers. Until recently, there was no specific regulatory framework for peer-to-peer lending, making it effortless for startups to establish themselves.
Latvia’s Investment Brokerage Firm (IBF) License Latvia just introduced the IBF license, which aims to attract P2P platform players. It makes investing more secure for clients.
Investment Protection
The new legislation guarantees reimbursement for investments up to 20,000 euros. If something should happen with the P2P lending platform, clients get their money back within three months. This protection is the same that banks offer.
Investors are currently expressing more confidence with the new regulations and will likely fund loans up to the guaranteed amount. Various industry players have started the IBF license application process this year, with Mintos, VIAINVEST, and Twino all confirmed as doing so.
However, no company has received approval yet. Mintos has been waiting since March 30. VIAINVEST announced its entry into the application process in the same month. Twino is hoping to receive validation by the end of 2020.
The Financial and Capital Market Commission (FCMC) in Latvia is working to regulate existing platforms. Among those that have applied, a competitive spirit prevails as each player seeks to secure approval before the rest.
Licensure Requirements
To obtain the new license, Latvia’s FCMC requires the investment firm to list all its services. There are additional capital and reporting requirements.
The platform must also have Anti-Money Laundering (AML) controls related to customer due diligence (CDD). New legislation aims to keep financial crimes from disrupting the stability and safety of client funds.
The law now requires that companies verify customers to prevent money laundering. CDD also helps avoid the use of the financial sector for terrorist financing. The process involves examining client beneficiaries and documents and data legitimacy.
Companies can cross-reference information across credit bureaus and government agencies. In the end, these efforts result in greater security for investors.
The IBF license regulations add a new layer of complexity to IT platform development. Thus, launching a P2P system is now more time-consuming and costly.
BankLaunch is a FinTech company that provides necessary tools for compliance with Latvia’s new guidelines. In addition to the P2P structure, you’ll need an AML platform. Thanks to our flexible design strategy, we already give our customers access to both these modules.
It’s also possible to launch other financial applications from the platform, including credit card payments and SEPA transfers. These features can give you an edge over the competition.
BankLaunch is located in Latvia, too, which helps during the licensing process. Your investors will feel secure knowing their capital is protected. Launch your new crowdfunding platform with us!
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What’s BankLaunch?
It’s a digital platform that you can use to create the FinTech solutions you’re imagining. We provide the ability to build MVP and integrate with required APIs quickly.
Stay tuned for project updates and success stories!
BankLaunch is an open platform. You can assemble your solution from modules and select the integrations that best fit your business. Read the following interview with the founder to learn more about this new digital platform.
Please tell us about how you got the idea for BankLaunch!
I’ve been working in financial software development for over a decade, and I’ve always been fascinated by its complexity. I spent the past four years as the founder of A-Heads Consulting (https://www.a-heads.eu/), an IT services company.
While working in this capacity, I observed that FinTech startups are challenging. There’s no real Minimal Viable Product (MVP) approach, so I decided to make one.
From the outset, any FinTech system should have several functionalities. The minimum expected include customer onboarding, risk scoring, KYC and AML policies, accounts, reports, and connections to payment networks. Your startup needs all this even before you address solving core business problems for customers.
FinTech solutions are different from traditional banks or neobanks. They tend to focus more on a niche market and excel at one type of service.
However, there are a lot of other things you need to consider. We came to understand this all too well while working with scores of different payment, lending, and banking customers.
All client projects started from scratch and integrated multiple external APIs and products. After a time, we began seeing commonalities among them. We realized we could extract shared features as modules and reuse them to speed up the development process.
The only issue we ran into was that the code is customer property. Usually, clients would be against the idea of making it available for reuse by rival organizations.
So, we had to devise a solution. We invested many months in developing a FinTech system architecture blueprint and modular approach.
We’ve found it has many productive applications. So, we put together a Revolut-like demo, which shows how all components can come together to provide customers with a ready-to-deploy payment system.This could be used as a starting point to add extra features such as line of credit, cross-border transfers, or investments.
What are the main challenges FinTech startups face today?
The FinTech market is fractured. The components you need for your system depend on a number of variables. First, you need to consider the cultural and behavioral preferences of your target customers.
The method of solution development also depends on the country where you applied for licensing and operation. For example, a post-Brexit system would use different payment protocols and compliance procedures from the rest of the EU.
The FinTech innovation rate is currently rocketing, even without considering today’s trends in cryptocurrency. Because of the COVID-19 pandemic, many businesses have gone online.
The minimum customers expect under such circumstances is to be able to pay with credit cards using their smartphone. Innovative remittance protocols keep emerging, along with other completely novel scenarios.
Technologies are constantly changing, and everyone’s cloud-based nowadays. Open-source alternatives are replacing commercial databases like Oracle and Microsoft SQL. These advancements are occurring across all areas of technology.
How is BankLaunch different from competitors?
Look, there are many competitors in core banking software, and there’s no clear market leader. Customers experience frustration with off-the-shelf products, and there’s a lack of competitive advantage when using the same SaaS as others.
If you use a vendor who offers software as a service, you may pay little initially but find high costs when you request changes. You might also find you can’t migrate away from the proprietary platform.
BankLaunch provides an alternative strategy. It’s a mixed approach, in which we provide development and consulting with custom coding. Instead of starting from scratch, our platform uses modules.
You can choose a white-label or SaaS model. We analyze licensing requirements, customer onboarding workflows, and risk modeling to help shape your solution. In-house customizations, such as workflows, reports, and integrations, speed up knowledge transfer and delivery.
BankLaunch offers fast FinTech MVP rollout, and it’s your one-stop solution for platform and customization services. We integrate various partner APIs and aim to create a FinTech connectors marketplace.
We understand that your business has a schedule to keep. Time to market is vital, and you can’t put everything on hold due to financial and licensing fees. We can help you have your new product ready in just a few months.
Our cloud-native architecture runs on-premise or inside any public cloud. It’s compliant with best practices and industry standards, including GDPR and PCI DSS.
What are the primary use cases you’re currently targeting?
There are a few dozen FinTech common use cases I’m aware of right now. Some startups apply a mix-and-match approach to create a unique offering in their geographical area.
BankLaunch can develop white-label core banking solutions. We currently launch peer-to-peer crowdfunding networks, cross-border remittances, credit card solutions, and AML compliance tools. If necessary, we can combine these functions and adjust them to meet each customer’s needs.
How can I know if my next FinTech project is a good match for BankLaunch?
Get in touch with us, and we’ll provide initial analysis and a quote free of charge. Our ready-made modules allow us to offer competitive pricing. We can help you build your dream solution and enter the market while keeping costs low.
You can use our growing network of partners and API vendors to help you choose what’s best for you. We’ll provide the integration module. We’re well versed in European Union FinTech regulations and can help you build a solution for any EU country.
Stay tuned for project updates and success stories!
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