Welcome back to Exchange, where we take a look at the most important fintech news of the previous week. If you’d like to receive The Interchange straight to your inbox every Sunday, head over to here to sign up! Due to the US holiday, this is an abbreviated edition.
Buy now, pay later
Both Klarna and Afirm – known primarily as buy now, pay later companies – revealed their quarterly results this week. And they did not disappoint.
Affirm reported that its fiscal first-quarter revenue grew 37% year-over-year to $497 million with gross merchandise volume increasing 28% to $5.6 billion during the same period. And its shares were acquired Big push As a result, it rose to a high of $27.16 on November 9. However, it lost some of those gains on November 10, and was trading just over $22 that afternoon.
Meanwhile, Klarna reported revenues of 6 billion kroner ($549.9 million), up about 30% from 4.6 billion kroner ($421.6 million) in the third quarter of 2022. The company also reported an operating result of 130 million kroner ($11.9 million dollars), a huge improvement on 2.12 billion kroner ($192.6 million) Loss a year ago. (All currency conversions use current SEK-USD values.)
Both companies reported fewer late payments, meaning they lost less money on people who didn’t make payments. It’s good news for both companies and the space itself.
Speaking of Klarna, Alex and I teamed up to report on Klarna’s confirmation that it’s headed toward an IPO. We’ve touched on what happens next, and what could happen if IPOs are a successful way to raise capital again. Read more.
Weekly news
Reporter Annie Ng’ang’a has been following Flutterwave for over a year now since the Kenyan government accused the African fintech company of engaging in money laundering and fraud. This week we got an update that the company is now outside the reach of the law after a court ruled that the country’s asset recovery agency can withdraw its case against Flutterwave. Annie breaks everything down for you.
Mary Ann and Alex Wilhelm dedicated some of them justice took the time to discuss the encouraging signs they were seeing in the fintech industry. They touched on some huge rides that we haven’t seen in a while. The duo also discussed Klarna’s strong third-quarter results, which we spotted Take Simon Taylor On X.
Now speaking of earnings, Klarna and Affirm weren’t the only ones with good news in the third quarter:
- Dave’s third-quarter net loss improved 47% quarter-on-quarter, while the number of monthly transacting members increased 6% to 1.9 million.
- Flywire’s third-quarter revenue increased 29.5% year over year, with CEO Mike Massaro saying in a statement that the company “had its highest quarter of revenue and EBITDA ever.”
- Payoneer reported record revenue of $208 million for the quarter and saw active growth in ideal customer profiles of 5% year over year.
- At Robinhood, the investment firm reported total net revenue increased 29% year over year to $467 million as customer signups increased to more than 1.3 million, with 100,000 added in just the third quarter.
At the same time, it’s not easy to get good credit, which is why some fintech companies have focused on preparing children and teens to succeed in this field. For example, in August, Greenlight launched the Greenlight Family Cash Mastercard. Now the step has one. CEO CJ MacDonald chirp Late last week, the company launched Step Black, a rewards card geared toward Gen Z to build credit without debt. Via email, McDonald announced the card as “the world’s first secured Visa Signature Rewards card” and amassed a waiting list of more than 100,000 cards in the past two months. It’s a 17-gram metal card that has features like no minimum credit limit, $500 in annual perks, and up to 8x cash back. You may remember that in May Step announced a 5% interest rate on its savings account, and Step Black holders will also get that rate up to $1 million FDIC-insured. – Christine
Other items we read:
The CFPB proposes oversight of Big Tech’s digital wallets
Banks are looking to fintech companies to ward off the threat from Big Tech
Arc launches its international treasury product for the first time
Visa launches a global AI consulting practice focused on generative systems
Belvo offers a bank discount service for Mexican businesses
Bluevine offers high-yield interest rates for small and medium businesses
PayByPhone has been acquired by FleetcorIt was acquired by Volkswagen in 2016.
Finance, mergers and acquisitions
As seen on TechCrunch
Enable, a B2B discount management platform, is now valued at $1 billion
Volante raises $66M for payments technology for banks and other legacy financial companies
Mogul Club raises $3.6 million in its effort to make real estate investing more accessible
Seen elsewhere
Holding denies a report about the acquisition of Milio
Andreessen Horowitz is co-leading a $60 million AI fintech investment
Valor Capital is eyeing $500 million for two new funds
Singapore-based fintech LXA has secured $10 million in its latest funding round