Latest banking news, July 15, 2022

Latest banking news

July 15, 2022 4:06 PM

Our latest bonus coverage includes two stories tied to the suddenly struggling buy now/pay later sector, starting with a deal between Affirm and SeatGeek. The fintech Stripe also features in a pair of items, and we report on a venture capital fund that will connect community banks and tech providers.

Scroll through to see what you might have missed this week in banking, payments, fraud and more.

SeatGeek adds Affirm for BNPL

Installment Loans Provider Affirm Holdings Plans IPO

Gabby Jones/Bloomberg

In the midst of a tough time for the buy/now pay later industry, Affirm has signed a deal for new business from SeatGeek, a mobile ticket platform for sports and entertainment events. Affirm will provide a point-of-sale credit option for ticket purchase. Buyers will choose Affirm as their payment option, then will undergo a credit check. The total cost and terms of the loan will then be displayed before the buyer makes the purchase. After growing quickly in 2021, BNPL firms have come under pressure in 2022, with falling valuations and regulatory scrutiny stemming from concerns inflation and a soft economy will increase default risk. — John Adams

Venture capital fund will connect community banks and tech providers

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Bankers Helping Bankers, an online platform for community banks to collaborate and share knowledge about bank technology, has launched a fintech venture capital fund. The BHB Fund will “support community bankers’ engagement with emerging technology providers … and navigate the rapidly changing landscape of financial technology.” The fund will be managed by Latitude38 Venture Partners. A number of funds connecting banks and credit unions with fintechs have sprung up in the last few years.— Miriam Cross

Four firms emerge from Flagstar mortgage tech accelerator program

Flagstar Bancorp, in Troy, Michigan, concluded its third MortgageTech Accelerator program on Thursday. The $23.2 billion-asset institution says this is the first and only accelerator program in the U.S. focused on mortgage technology. The four startups that graduated were LoanSense, which helps borrowers reduce their student loan debt and buy a home with the savings; OrangeGrid, a no-code development platform; Calque, which facilitates “trade-in” mortgages; and CredEvolv, a credit and debt management education platformv. Flagstar mentors the companies on how to integrate technology, price their products and more. “We place a huge value on using technology to change consumers’ lives and offer an industry-leading customer experience,” Lee Smith, president of mortgage for Flagstar Bank, said in a press release. — Miriam Cross

Synchrony, Fiserv extend buy now/pay later options to small businesses

The private-label credit giant Synchrony Financial is extending its SetPay buy now/pay later service to small businesses that accept payments through Fiserv’s Clover devices. The interest-free financing option enables users to finance purchases of about $40 to $500 by repaying the amount in four equal installments. Rad Air Compete Car Care & Tire Centers, a 10-store franchise based in Ohio, is the first merchant to adopt the service. — Kate Fitzgerald

Stripe cuts valuation ...

Stripe is the latest firm in the fintech sector to see its valuation dwindle, internally cutting its valuation to $74 billion from $95 billion, according to The Wall Street Journal. The company did not respond to a request for comment from American Banker about the report. Stripe, which uses an application programming interface to allow businesses to accept payments online, has rapidly built other products to extend its relationships with merchants. Most recently it added an account aggregation service to compete with Plaid and other firms in open banking. Many other fintechs are also suffering valuation declines in 2022, following a robust 2021. Categories such as buy now/pay later and crypto have been particularly vulnerable as investors fear a weakening economy will create higher delinquency rates for BNPL loans and bankruptcies for crypto firms. — John Adams

... and cuts deal with a marketing platform

While it's slicing its valuation, Stripe is still expanding its product line. Stripe has entered an agreement with LTK, a marketing platform for influencers, to support a payment rail for content creators. Stripe will add services that provide billing, payouts and online merchant service to LTK Connect, a self-service platform that connects brands to LTK creators — creating a model similar to those of Patreon and other firms that facilitate payments between content creators and consumers. LTK's creators drive roughly $3 billion in annual sales through more than 6,000 retail partners. These retail partners use LTK connect to enable shopping experiences produced by LTK's content creators. — John Adams

BofA nabs Guggenheim's Taylor for health care investment banking

Michael Short/Bloomberg

Bank of America hired Cameron Taylor from Guggenheim Securities as a managing director in the health care investment banking team’s life sciences group. Taylor will be based in New York and report to Adrian Mee, head of the company’s global health care investment banking team, according to an internal memo seen by Bloomberg News. A spokesman for the Charlotte, North Carolina-based firm confirmed the appointment and declined to comment further. Taylor, who has more than 14 years of investment banking experience, focused on emerging and large-cap biopharmaceutical clients at Guggenheim. He started his investment banking career at Piper Jaffray, now known as Piper Sandler. — Gillian Tan and Steve Dickson, Bloomberg News

Three convictions in 'prolific' ATM skimming

Three members of an international ATM skimming and money laundering organization were convicted Monday in a Manhattan federal court on charges including bank fraud, wire fraud, access device fraud and aggravated identity theft, the United States Attorney for the Southern District of New York said in a news release. The members of the ring laundered millions of dollars from 2014 to 2019 by installing machinery on ATMs and point-of-sale machines, collecting customer card numbers and PINs, reencoding the information on counterfeit cards and then withdrawing as much money as they could. Mircea Constantinescu and Nikolaos Limberatos, two leaders of the organization, and Alexandru Radulescu were among 33 defendants charged in connection with the case. — Paige Hagy