2020 in headlines: SkyParlour’s wrap of the year

By: SkyParlour
2020 in headlines: SkyParlour’s wrap of the year
Published: February 1, 2021

What to make of 2020… Well, it’s been a ride, of that we can be sure.

The fintech industry overall has fared well, although certain factions have undoubtedly felt the impact relating to changes in key verticals. For some, the spread of COVID-19 has provided an opportunity to intervene with solutions to the problem of cash, and to enable those consumers shielding at home the opportunity to still make payments via friends or family – for example, Starling’s Connect Card.

And one thing’s for sure – 2020 certainly hasn’t been short of news stories, hosting one of the biggest payments scandals in recent history, and marking a turnaround for the Fintech industry as the first digital bank became profitable.

It’s a lot to process everything that’s happened, especially as the pandemic seems to have overwritten pretty much everything since March. So, we’ve put together our wrap of the year, breaking down only the biggest Fintech headlines to have landed, month by month.

This is by no means a definitive list but it’s our list. There were also hundreds of news stories from our clients alone that we could have covered – but these are the stories that made the big headlines, while impacting both the SkyParlour team and our clients.

So here we are, SkyParlour’s top Fintech news stories of 2020:

January

The year was off to an almighty bang as big names around the world partnered, invested-in and outright purchased some up-and-coming Fintechs.

Setting 2020 up with a positive outlook, African fintech firm Flutterwave announced it had raised $35m in a series B funding round, as well as announcing a partnership with Worldpay for payments in Africa. With the funding, Flutterwave said it would invest in technology and business development to grow its market share in existing operating countries.

And in one particularly noteworthy development, Visa announced it was acquiring Plaid in a deal worth $5.3bn, representing one of the biggest acquisitions in the fintech space to date.  

February

It was all eyes on the battle of the digital banks in 2020’s second month as key players made headline news in national newspapers.

For example, Revolut became the UK’s most valuable financial technology start-up after a funding round that more than tripled its value to £4.2bn. The valuation put it ahead of rival digital bank Monzo, which was valued at £2bn in 2019, and that of small business lender OakNorth, which previously held the top spot at £2.2bn.

To top it all off, Revolut announced it had raised $500m (£387m) from a group of investors led by the US fund Technology Crossover Ventures (TCV), ending months of speculation around the deal. TCV was an early backer of companies including Airbnb, Netflix, and Spotify.

March

Well, We all know what happened here and, needless to say, the month of March was an interesting one for the finance and Fintech industries. The initial impact of the Covid-19 pandemic was already starting to hit the world’s economy as borders closed their doors, lockdowns observed, and shops were forced to embrace an online presence.

For essential shops and businesses, the announced introduction of an increased contactless transaction from £30 to £45 was heralded as a way to keep us all safe and, quite literally, contact free.

Now, it seems that this change is here for good, though it will be interesting to look back on this change in 2021 to see whether an increase in the number of fraud cases has been observed as a result of people taking advantage of stealing cards / the high transaction limit. One to continue watching for 2021…

A little closer to home was SkyParlour’s attendance at the Digital City Festival – our final physical event of 2020! As well as being well attended by familiar faces, including our very own Adyen and the Emerging Payments Association, Angela Yore made a special appearance discussing the importance and purpose of PR.

April

This is when the impact of Covid-19 really started to be really felt as the FCA extended the SCA (Strong Customer Authentication) deadline by a further six months to try to keep things simple amid the rush to respond to COVID.

In the same month, the first big international event in Fintech was shelved due to Covid-19 as Swift cancelled the Sibos physical event, which was due to take place in Boston in early October.

Responding to the impact the virus had already had on start-ups up and down the country, at this point the UK Government rolled out a £1.25bn start-up support package. The package included a £500m investment fund for high-growth companies impacted by the crisis, and £750m of grants and loans for SMEs focusing on research and development.

May

Despite the UK remaining in lockdown, digital banks dominated the headlines again, as Starling Bank landed an additional £40m in funding from existing backers, adding to its £60m raise in February, and Revolut announced it was making its own headlines as the world started to look at the people behind the digital banks.

And that’s not all. This was also the month that the media and marketing scene in Fintech went digital with events and content, including The Future of Banking podcast which launched in May and is hosted by our very own Kimberley Waldron.

As well as this, the UK Fintech scene continued to help tackle funding issues for UK businesses at all levels, including the smallest businesses (after the likes of Starling, OakNorth, and Tide joined the government-led loan schemes).

June

This month provided a real scandal, from a Fintech business that had relationships with everyone from traditional banks and schemes, to new market entrants and start-ups.

The announcement about misconduct at the highest level of payments processor Wirecard in June, rocked the global market and called the entire Fintech industry into question, with “one of the largest accounting frauds in German post-war history”. In fact, Dan McCrum, Investigative Reporter at the Financial Times, called this, by far, the biggest story of his career.

July

In July we saw one of the first positive news stories for Fintech in the initial aftermath of the Wirecard scandal and as the Fintech world started to dust itself off and regroup,  The Times detailed why British fintech should emerge as a relative winner from the Wirecard scandal.

Additionally, the UK government launched a review into the country’s Fintech industry to identify opportunities to further support growth in the sector, as venture capitalist (VC) funding slowed as a result of the impact of Covid-19.

The review was started to help ensure the industry has the resources to grow and succeed, that conditions are right for the widespread adoption of financial technology, and that the UK’s global reputation for innovation is maintained and advanced.

August

This month provided more news from the schemes, as Visa finally won approval to acquire US fintech firm Plaid. An investigation had been launched into the purchase as there had been concern that Visa would reduce competition in the UK by buying out one of its major competitors.

The investigation concluded, however, that the UK Fintech scene is so strong that, even with this purchase, Visa would still lack any kind of monopoly in the market, highlighting the vibrant fintech scene in the UK.

And despite many attempts to keep the event safe for attendees, Money2020 Europe finally announced its cancellation as the measures required to keep it safe would impact its quality, meaning the fintech industry missed out on yet another opportunity to come together.

September

As the world grew used to living under restrictions caused by the pandemic, Buy Now Pay Later firm, Klarna, was named as Europe’s most valuable Fintech, perhaps as a result of COVID-19, as digital and mobile payments continued to soar with ecommerce having become essential during pandemic restrictions and lockdowns.

The start of Q3 also saw a recovery in confidence from the investment community and mainstream names hit the headlines again as a result. For example, Spanish multinational banking giant, Banco Santander, announced the launch of Mouro Capital, an autonomously managed venture capital fund aimed at Fintechs and similar financial services companies.

October

The recovery continued in the Fintech space over the next month, as UBS Next – which pursues direct investments into early stage Fintechs and other relevant tech companies – announced it was investing $200 million in fintech start-ups through a new venture fund that will underpin internal modernisation efforts and strengthen strategic partnerships.

In addition, the bank also entered a partnership with Anthemis to help identify up-and-coming fintech start-ups and boost deal flow.

November

Fintech continued to catch the eye of the national newspapers – this time for creating too much momentum ‘too soon’ with alternative bank Lannister attracting concern from the FCA. Eventually, this was resolved and the FCA rescinded on the statement, but it was an indication of how mainstream fintech is becoming.

In a significant stride, Starling bank announced its profitability by Christmas, making it the first digital bank to do so, and Anne Bowden also discussed her recently launched book, Banking on It: How I Disrupted an Industry.

A bit closer to home, SkyParlour announced its own headline and launched three new divisions – Started, Scale and Consult – to support the evolving fintech market and help firms better express their purpose.

December

The news hasn’t slowed down in the final month of 2020, as Libra announced it is rebranding as Diem, in an effort to distance itself from the cryptocurrency project’s backer, Facebook.

In fact, this is an indication that crypto as a whole is ready for a second wave of success in 2021, as players like ‘Libra’ reposition themselves to preserve trust, which is bound to be key to the success of the crypto market as a viable currency.

And coming full circle, we are back to news of the digital banks, as Monzo has scooped another 60 million in funding. This indicates that the pandemic hasn’t had an entirely detrimental effect on funding in Fintech. However, it lays the benchmark for achieving sustainability and profitability in Fintech, which is sure to be high on the agenda in 2021.

Finally, there’s been an increasing flurry of news in December (indicating that 2021 will be another busy one for Fintech!) including mythical beasts, pots of gold and big dreams, as Alphabet-backed UK fintech GoCardless nears unicorn status post £70m funding, Citi builds its fintech marketplace, and Forbes reports on how fintech can help the global economy recover.

If nothing else, the Fintech industry has proved its resilience over the past 12 months, and that it is well and truly here to stay for the long haul. In fact, the industry has shown itself to be both vital and agile in the response to Covid-19. So, here’s to 2021! 🥂 At SkyParlour, we can’t wait to see what the new year will bring.

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