Posts published on April 2017

Toucan Weekly Round Up – 28 April 2017

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Fintech, Payments and SEA Focused Articles

Jack Ma’s Ant Financial merges with Lazada’s HelloPay Group

Ant Financial, Alibaba’s financial affiliate, has announced that it has merged with HelloPay Group, Lazada’s online payment platform. HelloPay will be rebranded as Ant Financial’s online and mobile payment solution Alipay in its respective Southeast Asian markets. Integrating with Alipay will help Lazada improve its online payment solution, given Alipay’s quality in payment security and systems.


Alibaba-backed Paytm forays into digital gold; consumers can now buy, store, and sell gold on their smartphones

India’s leading digital payments company Paytm has foraged into digital gold business that allows users to buy, sell and store gold on their mobile phones. For this service, Paytm has partnered with precious metals processing facility MMTC-PAMP India. Users can buy and sell gold using their Paytm account, which will then be stored in lockers run by MMTC-PAMP. Users can also redeem accumulated gold in the form of coins or minted products and get them delivered to their homes. Alternatively, he/she can sell their accumulated gold back online instantly and the money will be credited into his/her account.

gold coin
Designed by Freepik

Flux, a fintech startup found by ex-Revolut employees, wants to make paper receipts obsolete

Flux, a London-based fintech startup is on a mission to make store receipts truly digital. The company has built a software platform that bridges the gap between itemised receipt data captured by a merchant’s point-of-sale (POS) system and what little information that typically shows up on your bank statement or mobile banking app. By partnering with merchants, their payment processor/POS systems and banks, Flux hope to make item level receipts digital and link them to your bank statement, in a seamless and intuitive manner.


TransferWise sets up Singapore office to serve as Asia-Pacific HQ

Online money transfer startup TransferWise is setting up its Asia-Pacific hub in Singapore, allowing it to reach more customers in the region. The startup allows its customers to send and receive money across borders for a fraction of the charges imposed on bank transfers. To do that, it uses a p2p system that matches users according to the currencies they want to send and receive, ensuring that payouts are made without funds ever actually crossing borders.


WeChat is more ‘sticky’ than Facebook

WeChat is stickier than ever, creeping into new aspects of our daily life and being used for an even longer period of time everyday. WeChat is now used for more than four solid hours per day by one-third of its users, up from 16.3 percent in 2015. The average daily time spent on WeChat has also risen up to 66 minutes, as compared to Facebook whose average users spend 50 minutes on it everyday. 82% of people have done office work or personal business on WeChat, mainly coordinating tasks, transferring files, taking video calls, and making transactions using the cashless WeChat Pay system, vindicating WeChat’s speedy rollout of new features in the past few years, covering online shopping and payments.

Toucan Weekly Round Up – 3 April 2017

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Fintech, Payments and SEA Focused Articles

Grab confirms it will acquire Kudo to boost digital payments

Grab has joined forces with Kudo after signing an agreement to acquire the Indonesian Payment Startup for an undisclosed amount. The acquisition of Kudo is due to Grab’s interest in expanding their digital payments system GrabPay. Kudo’s existing payments platform helps hundreds of thousands of customers sell prepaid phone credits, tickets and clothing in Indonesia. With this acquisition, Kudo’s own platform will be integrated into Grab’s own existing payment ecosystem.


Fintech startup soCash raises US$600,000 from angel investors

SoCash is a Fintech startup that provides digital cash management platform for banks. The platform enables users to withdraw cash from avenues like neighbourhood shops by placing orders on the bank’s app, selecting a cashpoint nearby and picking up the cash at the said outlet. The startup recently raised US$600,000 from angel investors and also became the first Fintech to receive the Financial Sector Technology & Innovation grant from MAS. SoCash’s goal is to enable convenient access to cash and reduce the cost of cash processing for banks.

OJXLE60Designed by Freepik


Ayopop raises U$1M from GREE Ventures to let Indonesians pay bills via an app

Ayopop is an Indonesian digital payments platform that aims to help Indonesians pay their utility and mobile subscriptions via a mobile app. It has announced that it has raised US$1 million in a seed round led by GREE Ventures. Although most Indonesian are still paying their bills and utilities offline, startups like Ayopop aim to raise awareness and open up opportunities for online digital payments in the country.


Japan: Major bank Sumitomo developing biometric ID fintech software

Japanese Bank Sumitomo Mitsui Financial Group has announced that they are researching and developing a biometrics software that uses voice recognition, facial recognition and fingerprint verification to carry out online payments. This move is part of a continuing effort to increase the security of financial payments and transactions in light of recent cyberattacks on Swift, the messaging system used by banks to conduct transfers. Sumitomo’s technology could prove to be a game changer for businesses that are looking for stronger and more affordable security measures for their online payments.


Inside SelfScore’s No-File Credit Model

SelfScore is a Fintech startup that provides credit access to international students. The startup uses machines learning to determine the creditworthiness of students who lack a credit history, offering them a credit card that they can afford. The startup’s Analytics Based Credit Decisioning (ABCD) system considers Eligibility, Identity, Stability of Identity and Ability to Pay for approval, in the absence of traditional metrics like SSN and Credit Scores. By providing international students with access to credit that they otherwise wouldn’t qualify for, the startup also helps students build their credit scores.

A Simplified View on Credit Payments

Understanding how Credit Payments work

Ever wondered why it only takes a few seconds for your credit card or Paypal payment to be completed? The entire payment process may seem simple, but what happens in this short time may amaze you. Here is an overview of how your credit payment is processed 5 seconds after swiping your credit card at a checkout counter or confirming your Paypal payment on Lazada.


Definition of Key Terms

  1. Merchant Shop – A commerce shop that is offering and selling products to customers
  2. Merchant Acquirer – Acquiring Bank that processes credit card transactions and transfers all transactions to the Card Issuing Banks
  3. Card Networks – Acts as an intermediary between Merchant Acquirer and Card Issuing bank to authorize credit card transactions (e.g. Visa, MasterCard, UnionPay)
  4. Card Issuing Bank – Bank that issues credit cards to customers on behalf of Card Networks


a) Paying for your item

When a customer like Ben wants to pay for a shirt that costs $100, he swipes his credit card in an Electronic Draft Capture (EDC) machine at the Merchant Shop counter and all the transaction information linked to the credit card is captured. While shopping online on Lazada, Ben can pay for the same shirt using a payment gateway like PayPal that similarly captures the transaction information online.



b) Processing your payment

At the Merchant Shop, the checkout machine sends Ben’s transaction information to the Merchant Acquirer. For an online shop, the payment gateway Paypal encrypts Ben’s transaction information, such as his credit card number, into a randomly generated 40 character alphanumeric token and sends this encrypted information to the payment processor used by the Merchant Acquirer.



c) Approving your payment

After checking that your bank account is valid, the Merchant Acquirer forwards the transaction information to the Card Networks (e.g. MasterCard) and then to Ben’s Card Issuing bank to authorize the transaction. The Card Issuing Bank approves the transaction and sends an authorization code to the Merchant Acquirer, who then gives the approval to the Merchant Shop to sell the item to Ben. For an online shop, the payment processor used by the Merchant Acquirer forwards an authorization code to the payment gateway, who then transmits the authorization to the website to process the payment for Ben online.


d) Closing time at the end of the day

The Merchant Shop sends all authorized transactions for that day in a batch to the Merchant Acquirer, in a process known as Batching. The Merchant Acquirer then sends this batch of authorized transactions through the Card Network, to request payment from the Card Issuing Bank, in a process known as Clearing. The Card Issuing bank and Card Network subtract their own share of the Credit interchange fee and transfer the remaining amount of money paid by Ben from his bank account to the merchant acquirer. Lastly, the Merchant Acquirer subtracts its own processing fee that covers the cost of processing credit cards for the Merchant shop and pays back the remaining amount subtracted from Ben’s bank account to the Merchant Shop.



e) You get billed

Ben is subsequently billed $100 by the Card Issuing bank.


Great! So this is the entire payment process in a nutshell and it takes up to 5 seconds on average.

Now that you know how much happens when you perform that simple swipe, it’s time to remember to pay your bills on time!