Wall Street Journal
Shares of fintech companies such as PayPal, Square, Shopify and others have cooled down recently after a strong rally in the past year, but they “might just find a second wind, ” the Journal says.
“A broader positive trend for fintech upstarts has been a shift toward usage of debit cards over credit cards. A major revenue source for many neobanks and digital wallets such as Square’s Cash App, which have seen an influx of customers using them as a destination for direct deposits, are fees collected when debit cards are used.”
“Neobanking fintechs do have future things to navigate, like improving payment and digital-wallet technology at traditional banks, or more competition for deposits as rates rise. But in the nearer term the market might be surprised enough by big second-quarter numbers to stimulate these high-growth shares once more.”
Greensill Capital, the supply chain financial startup that collapsed earlier this month, relied on several big Wall Street banks “to fuel its expansion. Greensill’s closest Wall Street relationship was with Credit Suisse, which provided it financing through $10 billion of investment funds. But a clutch of other big players—including Citigroup and Morgan Stanley—played key roles in Greensill’s rise.”
“Citigroup expanded its business with Greensill despite repeated warnings internally not to do so because of reputational issues, according to people familiar with the Citigroup-Greensill relationship. The big U.S. bank operated a trust that processed payments for Greensill’s borrowers, forwarding