1082. News: Stripe bids for PayPal, BNPL regulation kicks in, and Nubank secures a Mexican banking licence

32:23Their licensed therapists specialize in ERP, the most effective treatment for OCD. If you think you might be struggling with OCD, Go to NOCD.com to book a free 15-minute call. They are here to help. Before we get back to the news, we have some news of our own. We've just announced our latest After Dark event, and tickets are available now. Join us at London's Village Underground on Wednesday the 17th of September for a live recording of FinTech Insider News. Head to 11fs.com slash After Dark to claim your free ticket today. We'll put a link in the description below. Back to the news. Our next story this week is that NewBank has received banking authorization in Mexico.

33:10NewBank has received final authorization from the Mexican regulators to begin operating as a fully licensed bank, completing its transition from a popular financial society to a regulated banking institution. The Brazilian bank already serves more than 15 million customers in Mexico, making it the country's largest digital bank. It says the new license will allow it to expand its product offering whilst deepening its long-term investment in the market. The move is part of a broader strategy. NewBank has already established banking operations in Brazil, Mexico, and Colombia, and earlier this year received conditional approval to establish a national bank in the United States.

33:51Alberto, NewBank's a little bit like Stripe. It's one of these incredibly impressive fintech companies. What do you think getting a license in Mexico says about the evolution of Nubank? I think it's wonderful news for the industry. Especially in Mexico, we see a lot of foreign banks. And I'm not surprised that Nubank decided to apply for a license there because they had already entered the market previously and they had over 50 million customers in Mexico. They had captured like 6 billion in deposits. And as I'm aware, in the latest news, I think they've reached break-even in this Q1 of 2026. So that's before receiving the license.

34:43So I think what this milestone says about the company is that it's not only growing in Brazil, where it has become a very relevant institution. Now it wants to become a very relevant institution outside of Brazil as well. And Mexico could be their new flagship or second branch or biggest, largest business line, right? And I think that's what they're after. A very large market, very interesting, and obviously a big milestone for the company. It is a big market. It's easy to sort of not realize just how many Mexicans there are. I mean, 15 million is a huge number of customers, but it's only 10 % of Mexicans, right?

35:34So, you know, there's a lot of room for growth there. Alex, NewBank is hardly the first fintech to seek a banking license. And of course, this is not its first banking license. Why do you think we're seeing so many fintechs going for banking licenses in Revolut, Monzo, Klarna, NewBank, you know, just name 30 fintechs. Not all, huge numbers of fintechs have gone for banking licenses. What drives that? What does having a banking license enable a new bank to do in Mexico that perhaps it couldn't do without the banking license? Yeah, I mean, I think it's part of this sort of broader sort of journey, I suppose, you've seen over the last 15 years with FinTech.

36:17I think originally you had the established banks as a sort of hub-and-spoke model with all these sort of satellites of capability that fed off that, say, core current account, which kind of held you in. And then, you know, in theory, you could then upsell, you know, credit cards, you could like personal loans, insurance, you know, mortgages, you name it. And then I think what, you know, what started to then happen with fintechs is they started to then pick off, you know, pick off these sort of satellite capabilities. And they'd sort of like, we actually could do the lending better than you, or we can provide, you know, credit cards with more benefits, or we can provide, you know, cheaper foreign exchanges.

36:54We saw sort of where Revolut started. and then bit by bit they started to sort of build that you know ecosystem of capabilities and then this is almost like endgame territory this is where they're coming into the hub now and they're like right we've kind of proven this capability we've acquired customers they love us and now we're coming for the current account sort of the last sort of defense I suppose if you thought about it from like a medieval castle so that is basically what we're seeing now why do they want to come into the hub, I suppose. And I think the reality is, that really is like the core, I suppose, of a lot of our financial relationships.

37:32And a lot of the challenge you're seeing with fintechs is, is there enough, you know, whether it's profitability or scale that you can get with these sort of, these, you know, satellite capabilities around the edge. And I think back to my time at Klarna, like a lot of what we were doing there is these satellite like capabilities, a bit like Nubank then in Mexico, it's a great way to build a customer base quickly and loyal. So, you know, they come in with a lower barrier to entry through a credit card, for example, in Mexico, you build up this great offer, a beautiful app, customers get used to it, they're using your services.

38:04It's so organic then just to open up another tab in the app, which is your current account, move across all these lovely benefits that you can get. And they've got, you know, they've essentially day one got that, you know, customer base to move across now the alternative model of trying to do a bank from scratch the barriers are so high the other way around you know to build up a customer base the the cost you know just to get your you know we saw with revolute the time it took them to get their permission you know banking license in the uk like that route is hard if you did that purely as your sort of entry route so i think this really is that sort of fintech play but you're seeing more and more now which is you build up customer base, you build up loyalty with, you know, a collection of services and you go for the hub and then you get that share of wallet.

38:48You get then actually with that sort of profitability, you can then get the profitability that you need that comes from more than just doing a, you know, buy now, pay later transaction every few months. You're suddenly, you know, really in the heart of how they live their lives. Thank you. Can I add a little something on that? I thought it was very interesting that New didn't look to fight the regulator at all. So they spent over a year looking to turn this FinTech Act into a licensed bank. And the scale of this is striking because they have a very deliberate regulatory journey and they're demonstrating that they can have this value proposition at scale.

39:24So they had the lighter touch, I believe it was the SOF IPO license before they had their full banking powers. So when their approval comes in 2025, they're then able to go through this very rigorous regulatory audit before their authorization landed a few days ago. So this is incredibly strategic and shows the future of fintechs. For fintechs to evolve in this way and to become a fully-fledged bank, the key is really having that long-term partnership with the regulators. There was another question I was going to ask you as well, Danielle, because it's really easy to sort of sit here and talk about international expansion.

40:04And in theory, it sounds really easy. What are some of the practical difficulties of actually trying to expand a sort of fintech business from one country into one or more other countries? What are some of the biggest challenges? Yeah, absolutely. That's something that I'm living every single day. So it's in terms of regulations, as we've mentioned, but there's also the cultural differences. And I really don't think that those can be understated. When you think just in North America, for example, the cultural differences that you can have from state to state, customer expectations will really, really differ.

40:40It's exactly the same when you look at countries in Latin America. So there's that. There's also the connections that people have to local government entities, the ability to influence legislation. These are all key components that are going to go into international expansion, as well as when you think of what, for example, SAMSUB does, the ability to provide the services in region, to provide the post-business support. You're going to need employees that are within the region. This is all part of the focus. It needs to be international expansion. As you said, it's not just putting things on a PowerPoint and saying, this is our goal for the next 12 to 18 months.

41:19You need to really break down what does this look like for day to day. Thank you. Alberto, I was going to ask you a question about technology and understanding local customers and so on, but there's apparently quite a big football competition at the moment. And I'm struck by the parallel between Nubank, the Latin American champion, and Revolut, the European champion. We've got these two digital banks, you know, converging on the United States, looking to be, you know, become sort of one of the world's most successful digital banks. So, hard question, Nubank or Revolut, which is going to be more successful.

42:00Easy question, and we're recording this before the World Cup final, Spain or Argentina for the win? I think that's an easy one. I think Spain for sure. But, you know, we'll see on Sunday. We'll see on Sunday. I'm Spanish, so I'm obviously biased. And on the first question, I think that's harder. I think that it really depends on the market. I don't know which one will win. Probably both, because the market is large enough and we've got literally thousands of banks worldwide. And I think that there's enough space for both of them, right? Probably new will be more popular in America in general. That would be my bet.

42:57It's tempting to think that there's a large Latino, Latina population in the United States will be attracted to new bank. but I hesitate ever to underestimate Revolute either. It's hard to tell. But maybe actually to Danielle's point, it's going to come down to partly how successfully those two firms negotiate the American regulators to sort of get approval. Okay, let's move on to our final big story of the week, which is that a survey by Sumsup shows that AI is changing the fraud landscape. So artificial intelligence is making financial scams more convincing than ever, as I'm sure everyone listening realizes.

43:46And new research finds that older consumers are among the most exposed. So the survey from verification platform SumSub has found that almost one in three Americans over the age of 55 have been targeted by a scam over the past year. And only one in five of these American seniors believed that they could identify an AI-generated cloned voice, far fewer than among young Americans aged 18 to 24. And the findings come as the FBI, Federal Bureau of Investigations, reports receiving more than 22 ,000 AI-related fraud complaints last year, representing almost$900 million in reported losses. And the research also highlights another challenge, which is that many families still haven't discussed how they would respond if someone received an AI-generated phone call video or message pretending to be a loved one.

44:40Danielle, this is really interesting research, and it shows the biggest challenge isn't just the increasing sophistication. It's also that people aren't really prepared for it. What stood out most to you from the research? Absolutely. What stood out to me is how quickly the scans are evolving. So AI has definitely lowered the barrier to creating very convincing scams, whether it's a clone voice, a realistic email, a text, or a fake customer service interaction. So the tools are becoming so much more accessible, and it's very difficult for people to rely on traditional warning signs. So awareness isn't enough anymore.

45:25I myself have been in this industry for a number of years, and I was nearly caught twice in the last six months. And this is a field I work in every day. I nearly was caught by a phone provider and also on a local Facebook group. So the scams have become so sophisticated that people need to have very simple verification habits that they can use if something feels urgent or unusual. and I think one of the points you mentioned is key. It almost needs to become part of the family safety. I remember when I was a child and my father would take me out in public, you know, there was a code word if somebody said, oh, my parents, I know your parents, they asked me to pick you up from school or something and, you know, if they didn't know the word banana, then I knew they were imposter.

46:09But we do need to have that preventative step because it has become so convincing and it's not just through banking, finance apps and things like that. is through all areas of life, right through social media, through people attempting to purchase something on perhaps a Facebook marketplace. It's become incredibly sophisticated. So that really stood out to us. And one of the areas that really concern us is voice cloning, because it has such an ability to create a sense of urgency. If it sounds like a loved one, think how you feel in the moment, it plays on your emotions. And it's that familiarity that's very, very difficult to question.

46:50So that's definitely some very concerning developments that we're seeing and we're constantly looking to fight them at what we do. It's really interesting what you're saying, isn't it? Because it sort of takes you off guard because this fraud will appear in familiar places, as you say, like a Facebook group or WhatsApp group or something like that. One of the things I was quite surprised by is actually not that the older Americans didn't think they could spot it, but how many of the younger Americans think they can. And now, obviously, younger consumers are generally a little bit more tech-savvy, or a lot more tech-savvy, actually.

47:27Alberto, does that surprise you that you've got, what was it, three-fifths of young Americans saying, oh, yeah, I can identify an AI-generated cloned voice. I mean, really? Can you? Obviously, you're not in that age group yourself, But do you think young consumers are actually being overconfident here? I think they're being extremely overconfident. And as we've seen in the past 24 months, this technology keeps getting better every day. So I wouldn't be so sure if, I mean, anyone can get tricked by this technology, right? So I think that authenticity won't come from human judgment or from like the technology that we have nowadays.

48:21It comes from verification systems. And what I'm thinking is that perhaps now it's a time for blockchain technology because it allows real-time verification systems to work properly, right? And if we only rely on traditional technology techs or human judgment, I think that we're going to get tricked very, very easily. It is interesting, this attack factor that Danielle is suggesting of a voice call with a fake voice of a close relative of saying, oh, I'm in trouble, I need... It was interesting because when you started talking about verification, I thought you were going to say actually families need to have some kind of verification like the banana trick that Danielle was saying.

49:19I mean, because is it realistic for families to put in place sort of some kind of blockchain-based system? I mean, how long will that take to roll out? That's a good question. I was thinking with the blockchain thing, I was thinking more about the relationship between financial institutions and the regular customer, right? But between peers, I think it's going to be super complicated. I honestly don't have an answer on how we're going to solve that. But yeah, I mean, Danielle's point is super valid and good. Maybe these kind of internal rules that we set can really help us. I think it goes back as well to what we saw with the being refused for the buy now pay later and then people falling.

50:06I'm going to use the word victim to perhaps more predatory lending. There's that underlying behavior in humans of shame. So there's the shame of I've been refused for a more legitimate loan and I've also fallen for a scam. And I think from what we see, particularly on a personal level, a lot of people don't want to talk about it or they don't want to believe that they would be silly enough to fall victim to it. And there is a need, I believe, across society to remove the shame from this. These have become incredibly complex phishing schemes. This is not the scams that we saw five, ten years ago of a prince from Nigeria saying, you know, wire me your bank details, I'm going to send you$10 million.

50:43dollars. This is somebody calling you up, I found your dog because they've seen that your dog was missing in a local Facebook group. Please, can you just verify you're the dog's owner? Before you know it, you've replied to a text because they're playing on that human emotion. So the takeaway that we really see on a personal level and across financial institutions and in fintechs and so on that they need to put in across blockchain, however that looks, is people shouldn't wait. this is now part of daily life. We shouldn't wait for something to happen to decide how you're going to respond. If you have that plan in place, whether it's in your family, whether it's with your financial accounts, then you're going to be able to have that clear mind to make a difference and make a decision when your emotions are running very high and someone is trying to pressure you into acting very quickly.

51:31Alex, do you think there's anything that financial providers can can do to help protect their customers from these types of scams? I mean, as Danielle says, they're becoming ever more sophisticated. Do you think there's anything financial firms can do to help protect their customers? I think there's probably, from a consumer side, probably more tolerance now to high levels of friction than maybe there would have been a couple of years ago because there is some level of awareness about the level of fraud or people. everyone now has some story or experience of it where you know even again a couple of years ago if you were like you want to make a payment on an e-commerce site and then you're you know you're getting locked on a page saying you've got to approve the payment back in your own banking app and you're like oh i've got to go get on the phone and go into this app and prove it i think now actually looks i was probably one of those people complaining about that two years ago right now i'd happily have that over experiences of either approving payments or buying something on a fraudulent you know checkout without having had those checks so i think i think there is a responsibility on providers to have sort of an appropriate level of um you know of friction to provide those checks and again i get irritated myself i sound very irritable but i get irritated myself when i buy anything where it's like on with hsbc it's like pages every time i make a payment it's like you know you're 100 percent 100 and 120 percent happy to be making this payment so and so and you know exactly what it's for like well just let me make the payment but i actually i think that extra level of like prompting you to think a question maybe make your own phone call i mean to danielle's point about shame i remember this is you know a few years ago but like i've been in days and days of whatsapp chat with what i who i thought was sebastian from clana founder of clana you know we had each other's number it would have been messaged but this you know this went on for days until finally it made some strange thing about approving a payment and then i suddenly was like I had to contact you know security team and be like I'm really embarrassed by basically having a chat with a phantom broadster for days now thinking it was Sebastian on WhatsApp totally embarrassed and I think that happens like day in day out and people make stupid mistakes and they don't talk about it so I think you know having a level of suspicion ourselves as consumers but that level of friction from providers to make us stop and think uh is important look another part I'll throw in is you know you know we always had this again back to times at Klarna where We saw the parallels where we had very high levels of fraud in the UK.

53:58The team back in Stockholm can understand this because they had, you know, essentially digital ID through bank ID there that was providing an extra level of protection that was preventing this in terms of you could identify us. So I think there are, as much as we don't like that sort of big brother, big mother, big sister model of digital ID in the UK, I think we do need to, you know, it's a trade-off ultimately, isn't it, as to what the protection that could give you as one extra tool in the toolkit to protect us from fraud. Last bit I would just say is like the AI piece, it is scary because the barriers to emulate, you know, to Danielle's point, a crappy email was very easy to do.

54:37But the barriers now to emulate whole websites that are completely fake, the ability to emulate chat and, you know, agentic AI used to be doing a bit like that WhatsApp conversation I was having, but be doing that across thousands of people simultaneously with no human intervention is scary. So I think that, you know, again, that extra bit of friction to provide a barrier, I think, is realistically right now one of the relatively, you know, limited protections that financial services institutions, you know, need to do. Thank you. You make a great point about, backing up Danielle's point about needing to take away the shame of getting caught out.

55:13So, you know, thank you for admitting that you, like so many of us, have been caught out. I think, Danielle, thank you for bringing us a really, really important story that everyone really needs to think about. So on that note, we will take a quick pause here and we will be back very shortly.

55:33Okay, now for a quick look at a story we don't have time to cover in full, which is that GoCardless and Sage have expanded their partnership to launch PayByBank for small and medium businesses. So GoCardless and Sage have expanded their longstanding partnership to bring pay-by-bank directly into Sage Business Cloud Accounting for small businesses in the UK and Ireland. The new integration allows businesses to accept instant account-to-account payments directly from invoicings, while automatically reconciling those payments within Sage. The companies say that this can reduce transaction costs by more than 50 % compared with card payments, while helping businesses get paid faster and spend less time on manual bookkeeping.

56:17The announcement is another example of open banking moving beyond consumer use cases and becoming embedded into the software businesses use every day. Rather than asking small businesses to adopt a new payment method, PayByBank is being built directly into existing accounting workflows. Now, we asked Tom Metcalf, Director of Global Partnerships at GoCardless, for his perspective, and he told us this. Let's have a listen.

56:46We've just expanded our partnership with Sage, bringing PayByBank directly into Sage Business Cloud Accounting. That's a big win for over 20 ,000 small businesses across the UK and Ireland, giving them a simple, card-free way to settle invoices. Instead of paying high card fees, merchants now get paid in one business day, saving an average of 54 % on transaction costs, and payments automatically reconciling in their accounts. Now this ties into a much bigger story, and is one we're genuinely excited about here at GoCardless. PayByBank is a type of account-to - And that category got a huge boost in June when the UK Payments Initiative, or UKPI, launched its new Pay by Bank scheme.

57:24That supports the UK's national payment vision, which is all about driving more competition, more innovation and more resilience by getting A2A payments adopted more widely. And that changes the bigger picture. For decades, UK businesses haven't had a real affordable domestic alternative to Visa and Mastercard. That near-duopoly has cost the UK businesses an estimated£1.5 billion a year in fees. Pay-by-bank changes that. And by building independent domestic account-to-account rails, we're helping the UK keep control over its financial infrastructure. So my view is that this is a great example of where open banking works.

58:05People adopt payment systems when they're better than the existing alternatives. and financial transactions like payments between businesses are a really great example of this. Because when you look at alternatives like credit card payments, obviously there are fees associated with those and those fees often go to things like reward schemes or payment systems working internationally and various types of consumer protection and refund mechanisms, things that people take for granted until the payment doesn't necessarily work. But it means that credit cards can be relatively expensive for high-value financial transactions.

58:42So making it easy to do pay-by-bank payments within business-to-business systems is a really obvious and strong use case for open banking payments, particularly when you embed those payments and make the reconciliation easier. So this is a really smart move by Sage and GoCardless. And I expect to see this being quite successful, depending on exactly how the customer experience work and exactly how it's implemented. But I think this is a very smart move and is the sort of area where we will see open banking payments and pay-by-bank payments being successful. And finally, a story that might make finding your next job a little bit less frustrating.

59:26The British government has launched a pay transparency consultation. The British government launched a consultation on plans to introduce greater pay transparency, including proposals that employers must publish salary ranges in job ads rather than waiting until later in the recruitment process. The consultation is part of a wider package of reforms aimed at tackling pay discrimination and making recruitment more transparent. Supporters argue it will help candidates make more informed decisions, reduce pay inequality and create a fairer recruitment process. Others say it could make hiring more challenging and reduce flexibility during negotiations.

1:00:07So obviously there's a little bit of an interesting subject to discuss because you're not, the three of you are not necessarily looking for a new job, but I'm sure you know people who are looking for new jobs and you've got former colleagues, friends, family members who've experienced the frustration of trying to find jobs. So let's talk about it in general terms. how do we think about you know applying for jobs without knowing the salary you know alberto you know if there's a job that's posted and there's no salary does that put you off does that put people off applying um do you think that's a like a crucial piece of information or is it okay hey it's a super interesting job i'll find out what the salary is i think it really depends on the point that you are in life at, right?

1:00:55And like, it really depends on the company and what you want to do, right? I'd say that having the salary up is always useful for the candidate, right? And also for the company because it kind of helps you filter out the people that are interested versus the people that are in, right? So, yeah. Yeah, I don't understand honestly why companies don't disclose salaries because, you know, if you're a hiring manager and you don't disclose the salary, you get a bunch of candidates who are potentially overqualified who you can't afford. And you get a bunch of candidates who are underqualified who, to some extent, are wasting their own time.

1:01:37And it would be much kinder if you just if you put the salary range in. That's going to rule out, you know, candidates either side of it. Candidates you can't afford and candidates are probably not qualified. um danielle do you think there's any good reason for companies not to publish salaries at least for most jobs salary ranges for most jobs truthfully no and it's interesting living and working in the u.s because we have the opposite in that we don't have a federal law that regulates that you have to declare this but you do have patchwork of states such as colorado california new jersey that do have to declare the salary ranges when they put a job advertisement out But that covers perhaps maybe a third of the workers in the United States.

1:02:21So for me, it comes down to trust and transparency. I do not see what the negative would be of doing a salary range, particularly perhaps not a specific figure, but a ballpark. As you mentioned, it ensures that you don't have people applying for the job that are wildly underqualified, but also people that are wildly overqualified, particularly if the job title is somewhat generic. But in today's day and age where it is very easy to access salary information with people sharing what they learn, sorry, anonymously on platforms such as Reddit and Glassdoor, it doesn't seem to be a worthwhile practice.

1:03:00And to me, if I were to look for a new role and an organization wasn't sharing that openly at least ballpark or addressing it in the very first call, that would bring an issue of trust to me and transparency. That's a really interesting point. Alex, do you agree that actually the transparency is a sort of competitive advantage and if you're not transparent, it starts putting candidates off? Yes, I do. I've seen both sides in different organizations that I've worked or roles I've looked at. There are organizations not disclosing salaries and where I've had that experience and sort of understood their logic.

1:03:37Now, often it can come down to a negotiating tactic. And for me, that's not a big draw if I'm going to an organization, even before you've got to that stage, trying to sort of play that down. The other side where I've seen it is where actually often it's symptomatic of where there's internal pay structure issues in the organization. And frankly, that's probably exposing more issues to them. I've seen that myself in organizations where hiring managers were nervous to disclose salary because they know they've got such a wide range of salaries that they're paying existing staff and this will expose that even more so and it becomes a sort of a hole that they just dig themselves deeper and deeper now why do i like to have salary ranges and even salary ranges i prefer to try and get as specific as you can is that so often it's a contributor to pay disparity between genders between people from different socioeconomic backgrounds you know for various other characteristics where people have different confidence levels as to how they want to then negotiate and sort of what they feel they're worth and yeah I've seen that time and time again you know particularly the gender disparity where you know typically the male candidates will be like absolutely I'm at the top of the range and you've you know often we've had you know female candidates who are you know much more accepting you know of a concept of you come in at this and you can work your way up and you know we've you know one of the things I was very proud of that Klarna was that sort of real push to have, you know, absolute gender parity in terms of pay.

1:05:08And I think, yeah, non-disclosure of salaries or, you know, wide salary ranges as a sort of proxy for that, you know, often are contributors to that kind of unfair pay between, yeah, different groups. Fantastic. A great way to wrap up that story and the show. Thank you so much to the three of you for joining me today. You've been absolutely fantastic. Where can people find out a little bit more about you and your companies? Danielle, where can people find out more about you and more about SumSub? Absolutely. So we are at sumsub.com and I am on LinkedIn as Danielle Labarbera, if anyone would like to connect with me.

1:05:48Thank you. Alberto, where can people find out more about you and more about Dalletier? So people can find out more about DALAT on DALAT.com. And I'd also invite the audience to connect me on LinkedIn. I'm very active on the platform and try to post a lot of stuff on banking and banking regulation and risk, banking risks. So yeah, that's it. And Alex, where can people find out more about you and Salad Group? So you can find out more about Salad Group at salad.co.uk. so there's a load of information on there please do have a read for myself I'm all about trying to get off channels if I can I'm all about getting off social media etc but LinkedIn you will find me on LinkedIn Alex DG Marsh there's an adult film actor called Alex Marsh which has been a curse of my life so I'm now very grateful for the David George that my parents bestowed on me his little name so yeah Alex DG Marsh on LinkedIn please do connect and as for me Benjamin and so you can find me on LinkedIn and you can find out more about 11FS at 11FS.com.

1:06:59So that wraps up today's episode. Thank you so much for listening to today's show. If you like what you've heard, please do recommend us to friends or colleagues, and you can follow us on your favorite podcast platform of choice. So thank you all so much and goodbye.