21 September 2023 |

What’s Up In Fintech

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On Thursdays, I share news stories and trending pieces I’m keeping tabs on. Consider it your shortcut to shifting through the noise in the fintech news world.

#1 Rising Debt, Falling Deposits, and Debbie

Debt is rising in the United States, hitting record-breaking levels. Americans’ credit card debt has surged to a staggering $1 trillion this year, while the country’s national debt has climbed to a monumental $33 trillion. These numbers alone raise alarm bells about personal and national finances. 

However, there’s more to the story.

In the first quarter of 2023, U.S. banks experienced an unprecedented loss of $472 billion in deposits, marking the most substantial drop in 39 years. Rachel Lauren, Co-Founder and COO of fintech startup Debbie sheds light on the connection between rising debt and vanishing deposits. 

Consumers increasingly move their money into higher-yielding assets while spending more, even as inflation squeezes their wallets. Much of this spending is done on credit, leaving their actual cash deposits unaffected.

Why It Matters: 

In a world where debt is a behavior problem more than a math problem, startups like Debbie are addressing the root of the problem. 

Debbie is a behavior-driven rewards platform for debt payoff and savings, aiming to change consumer financial behavior positively. By rewarding users for making conscious spending choices and managing their money, Debbie has helped its users increase savings by an average of $60-$100 per month.

Like other financial wellness platforms like Aura, Debbie’s approach draws inspiration from successful behavioral change models, like the dieting app Noom. It offers money psychology lessons, rewards for debt payoff and savings, and a marketplace that connects users with credit unions for debt refinancing and building emergency funds. 

Debbie’s business model, which generates revenue through subscription fees and transaction revenue from financial institution partners, allows it to offer its platform for free to consumers. So far, Debbie has raised $2.3 million, with plans to raise a seed round early next year. 

Fintech companies that can be at the forefront of integrating financial wellness into the $4 trillion wellness industry are genuinely onto something big. 

#2 Consumer Pulse: Embedded Finance, Wage Access, AI

Financial analysts may have given us some hope by reducing the odds of an impending recession, but let’s face it: economic uncertainty still has a firm grip on our wallets. Marqeta’s Q3 2023 Consumer Pulse Report delves into the nitty-gritty of how consumers (like the ones we serve but also us – we’re consumers, too) navigate this ever-changing financial rollercoaster.

Despite a slightly rosier economic outlook, sky-high living costs are still heavy on our shoulders. An eye-popping 86% of those surveyed can’t help but worry about the looming possibility of a recession, and as a result, 67% of us are tweaking our financial habits, desperately trying to find ways to trim our spending.

Here’s the juicy bit: the report shows that consumers are into embedded finance solutions that give quick access to hard-earned cash. Over two-thirds of the respondents (that’s a cool 66%) are ready to part ways with some of their creature comforts, like trading a year of takeout food (say goodbye to those late-night pizza runs) or sacrificing social media access to get their hands on their earnings a bit sooner. If that’s not a commitment, I don’t know what is. 

We’re also warming up to letting technology lend a hand in managing our finances. A solid 36% of us are curious about using Generative AI tools to keep our budgets in check. And if you’re under 50, that curiosity skyrockets to over 50%. 

Why It Matters: 

Well, Marqeta’s report paints a vivid picture of the financial hurdles we’re all facing – from consumers to professional consumers like us (I like to call us the pro-sumer), and it’s not just about the numbers. It’s about the way we’re adapting to these challenges. 

We’re leaning into daily wage access, embracing tech, and changing the game regarding managing our finances. This report provides insights for businesses trying to keep up with our evolving expectations and empower us in this ever-more complicated financial world. Curious for more? Check out the full report here.

#3 Nasdaq’s Latest Move For Sustainability

Nasdaq is making moves in the world of sustainability and impact investing. Their Capital Access Platforms division has just unveiled two offerings to make life easier for businesses and investors who care about making a positive impact.

First, Nasdaq Metrio – this is like the Swiss Army knife of sustainability tools. It’s a SaaS-based platform that helps companies collect, measure, and report their sustainability data. Nasdaq took their own OneReport and combined it with Metrio to create a powerhouse. It’s like a turbocharged ESG data collector that lets companies tell their sustainability stories. Plus, it’s got a new feature to help companies keep tabs on their emissions.

Next, meet Nasdaq eVestment ESG Analytics – this is like a secret decoder for investors. It helps asset managers determine their investments’ impact and lets asset owners check if their money is working the way they want it to. Using fancy algorithms and data from ESG experts (including Matter, a Nasdaq Ventures buddy), it gives numbers and stories to help folks understand the risks and benefits.

Why It Matters:

These tools are like a GPS for businesses navigating the sustainability jungle and a compass for investors looking to do good with their money. Also, Nasdaq’s “2023 Global Net Zero Pulse” report spills the beans on how companies can go green, and it’s a roadmap to a better world. So, it’s not just about numbers; it’s about making smart, sustainable choices that everyone can feel good about. 

We also have to champion financial inclusion to get tactical about fintech’s role in reversing climate change. We must prioritize efforts to provide women with equal access to financial resources and opportunities. Together, we can create programs and initiatives that support women’s economic empowerment, allowing them to invest in clean technologies and sustainable initiatives.

Second, let’s enhance the “S” in ESG through GLI investing through fintech: We have the tools and expertise to improve GLI investing. By collaborating with investors and businesses, we can develop fintech platforms that assess investments based on their environmental impact, social responsibility, and governance practices. Together, we can promote gender-focused investment funds and support companies committed to gender equality and climate action.

As I wrote in this Forbes article, 

“To have enough clean air to breathe, the fintech industry needs to be committed to all the defenses, tools, startups, and strategies to reverse climate change in the small window left.

Investing in women is how to get there, fast enough.”

MARK YOUR CALENDARS 

A Week In The Life

Tune in every Thursday to keep in the loop on the best fintech events happening each week! Whether it’s an online meetup or a fintech conference, these gatherings provide amazing opportunities to network, learn and connect with our incredible fintech community. 

So, let’s fill up those calendars with all the awesome events out there – I’d love to see you at one, or even better, if you have one you’d like to share, please let me know! 

MONDAY 9/25

  • [VIRTUAL] Learn How to Overcome Your Financial Trauma: Sure, we all work in fintech, but that doesn’t mean we are all finance experts. It definitely doesn’t mean we have all overcome our money trauma. Alejandra Rojas, founder of The Money Mindset Hub, talks about why it is so critical for women founders, CEOs, and operators to acknowledge and address the emotional baggage and trauma that money brings.

TUESDAY 9/26

  • [NYC] Blockchain Tech Summit: To accelerate developments within the blockchain tech industry, the Global Startup Ecosystem (GSE) will be hosting the 4th annual Blockchain Tech Summit-Virtual Edition. 

WEDNESDAY 9/27

THURSDAY 9/28-FRIDAY 9/29

  • [MIAMI] L’ATTITUDE 2023: Catch me in MIA next Thursday and Friday as I speak during two sessions during the VC firm’s annual summit. Who’s going?

HUMANS OF FINTECH

Alexandra Raymond, Amazon Studios

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Alexandra Raymond is a true powerhouse. She has more than a decade of experience as a Finance Product Manager, currently working at Amazon Studios, and a record of leading finance product and process automation projects. But that’s not all – she’s also a speaker, dedicated to making sure the underrepresented, underbanked, and forgotten of the financial system have a voice. And, if that wasn’t enough, she also founded Alexandra Raymond Consulting Inc to create products and services to increase diversity in tech and make the latest fintech information accessible to everyone. We love to see an entrepreneurial queen making moves.