Included in this issue: NatWest unveils online lending platform for SMEs; Santander introduces voice-controlled payments; Japanese banks invest in local bitcoin exchange; and more...


UK

Bank of England continue to produce polymer-based £5 and £10 notes, despite protests

The Bank of England (BoE) is to maintain production of polymer-based £5 and £10 notes, despite protests over the use of animal fats in the new plastic banknote. The BoE promised to investigate alternative options when concerns were raised that the new £5 note, which went into circulation in September 2016, contains tallow, a rendered form of beef or mutton fat. Following discussions with supplier Innovia it has decided against halting the production process for the new batch of plastic £10 notes which are set to be introduced in September this year. It said it had spent £46m on printing the £5 note, and £24m so far on printing 275 million of the new £10 notes. "Reprinting these notes on a new substrate would mean incurring these costs again. It would also require a further £50,000 for the secure destruction of the existing stock," says the BoE, adding that it "cannot guarantee" sufficient stocks of paper notes to replace the destroyed polymer notes. However, the BoE says it is seeking further opinions on the use of animal-derived products and plant-based alternatives before making any decisions on the polymer used in future production runs of £5 and £10 notes.

Independent, 15 February 2017

NatWest unveils online lending platform for SMEs

NatWest has launched a digital platform that lets small and medium sized businesses (SMEs) quickly apply for and obtain unsecured loans of up to £150,000. The platform, dubbed Esme Loans, has been developed by the bank at its innovation unit with FinTech firm Ezbob as a direct response to the emergence of specialist direct and P2P lending platforms. The technology promises to give SMEs - whether NatWest customers or not - a fast decision on funding, with successful applicants getting their money in as little as an hour.

Finextra, 14 February 2017

Santander introduces voice-controlled payments

Santander has taken its voice-controlled banking initiative to the next phase, with customers now able to make payments using voice-controlled software. Santander customers in the UK can make payments using their voice as part of a pilot of a range of speech-controlled services. The technology goes beyond voice-controlled security, it allows customers to vocally instruct the bank to pay someone at a certain time. The voice control technology, which is provided by Nuance Communications, can also be used to report a lost card, and ask about spending trends and account balances.

ComputerWeekly.com, 13 February 2017

Bank of England works with Anomali to improve threat intelligence capabilities

The Bank of England's (BoE) FinTech Accelerator recently ran a proof of concept looking at innovative technologies that collect, integrate, hunt and investigate cyber security intelligence data. Following the successful completion of this proof of concept, the BoE has decided to continue to work with Anomali to monitor and mitigate efforts against cyber threats. Previously, the Accelerator has undertaken proof of concepts looking at a range of areas such as blockchain, cyber resilience and data analysis. 

BoE, 10 February 2017

Worldwide

Japanese banks invest in local bitcoin exchange

Mizuho Financial Group and Sumitomo Mitsui Financial Group have joined a $1.75 million funding round for Japan's biggest bitcoin exchange, bitFlyer. The aim is to use the exchange’s digital currency know-how to better secure and make international wire transfers cheaper particularly for remittance purpose and enables wiring money to become available around the clock. Japan is already a large market for bitcoin and has grown further following the recent series of regulatory measures introduced in parts of China. The country is now deemed to be above the US and China as the highest-volume country for Bitcoin trading in the world.

Coin Telegraph, 15 February 2017

European Commission speech on international financial system

The European Commission has published a speech given by its Vice President and European Commissioner for Financial Stability, Financial Services and Capital Markets Union (CMU), Valdis Dombrovskis. The speech focussed on the merits of upholding a strong international financial system. Mr Dombrovskis highlights the advantages of international regulatory co-operation and a common approach to financial regulation. He argues that the effect of lax regulation in one country can be to create conditions for inadequate regulation and contagion throughout the world. He suggests that the effect of financial centres such as New York, London, Paris and Frankfurt having very different rules would be:

  • Increased exposures to risks imported from jurisdictions with less stringent rules.
  • Increased expense for global financial institutions in complying with different legal requirements.
  • Greater incentives for financial institutions to engage in regulatory arbitrage.

Mr Dombrovskis states that a strong commitment to international regulatory co-operation and internationally agreed standards should underpin the future relationship between the UK and the EU.

EC, 10 February 2017

Standard Chartered debuts API sandbox for corporate community

Standard Chartered has launched an Open Banking Application Programming Interface (API) Developer Portal with an initial focus on its transaction banking business. The portal will initially provide a repository of sandboxed transaction banking API services focussed on cash management and progressively rollout other API services for the bank’s other businesses. Clients and partners will be able to use the developer toolkit to create value added applications by integrating their services with the bank, reducing integration costs and time while enabling collaboration with a wide spectrum of partners including corporates, FinTechs and the wider developer community. 

Bankingtech, 10 February 2017

Key contacts

Amanda Hulme

Amanda Hulme

Partner, Head of Financial Regulation
London

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Fiona Ghosh

Fiona Ghosh

Partner, Commercial
United Kingdom

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Bruce Kilpatrick

Bruce Kilpatrick

Partner, Head of Competition
London

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William James

William James

Partner, Corporate
London

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