NetEnt is also moving into a new office in the Stanley Building at Kings Cross, which the company tags as a “strategically-important step”. The UK team has also been growing staff-wise and the office is seen to grow further within the next few months, as the press release says. 

“We are delighted to be open for business in the United Kingdom. We need a local presence to better support our valued customers and grow our market share. We have already recruited some key talent and now we begin a period of recruitment for the second wave,” said Andy Whitworth, Managing Director of NetEnt UK Ltd.

“This is a natural next step and an example of our commitment to the local market. The United Kingdom is already our largest market, and we see a short-term opportunity to grow our market share by being closer to our UK-based customers. Our increased presence in the United Kingdom is one of the NetEnt Group’s key strategic initiatives this year,” said Therese Hillman, CEO of NetEnt.

Although the company makes no mention of it, this step comes amid increasing Brexit uncertainty; as currently, Prime Minister Boris Johnson is trying to negotiate a Brexit deal in Brussels. Analysts expect the Brexit to shake up markets, with KPMG recently having forecast that a no-deal scenario could push the United Kingdom toward recession.

Business Malta earlier reported that online gambling company ComeOn has left the UK market, which step the company rationalised as an attempt to concentrate its business on more favourable markets.

The post NetEnt sets up UK company 44 days before Brexit deadline first appeared on The Malta Business Weekly.

After abandoning the UK market, ComeOn will still hold licences in Malta, Sweden, Denmark and Schleswig-Holstein — Germany’s northernmost state —, as well as a sports betting licence in Poland.

Tagging the UK market as a “very mature” and “highly-competitive” one, ComeOn CEO Lahcene Merzoug says the industry is shaken by “financial risks” and “uncertainty”. Additionally, Mr Merzoug says the “UK-licence has lost its symbolic value”, which used to be a must-have for a firm to be considered as “credible”.

“Today we hold licences in many European countries and given that the United Kingdom has never been a big market for us, it is a wise move to put our focus elsewhere”, the CEO adds.

Although Mr Merzoug does not make mention of the lurking Brexit around the corner, uncertainty has spiked in many industries as pundits seem unable to put their fingers on what would happen to the United Kingdom post-Brexit.

ComeOn’s online gaming portfolio via mobile, tablet and computer includes brands primarily in casino and sports betting.

The post ComeOn leaves UK market 59 days prior to Brexit deadline first appeared on The Malta Business Weekly.

As voicing uncertainty around Brexit is almost becoming a weary commonplace, nearing UK Prime Minister Boris Johnson’s 31 October deadline for leaving the bloc at any cost — at least for the time being —, Brits are becoming increasingly concerned about the potential decline in their passport power, rightfully so. As an outcast to the European Union, global mobility and settlement freedom of British citizens can suffer a severe blow.

With strong ties to the United Kingdom, Malta — the island nation that has generated considerable attention for investors interested in CBI schemes — lies in anticipation to see how Brexit could affect the Mediterranean nation’s attraction power for CBI investors.

“Whatever happens with Brexit, the United Kingdom looks set to remain a key financial, commercial, and lifestyle hub for the world’s HNWIs [high-net-worth individual], at least for the foreseeable future. If UK access is compromised for Maltese citizens post-Brexit, this would undoubtedly be a shame — but it would not necessarily be a deal-breaker,” says Paddy Blewer, Group Public Relations Director, Henley & Partners. Henley & Partners focuses on aiding investors with residence and citizenship planning, working in 30 offices worldwide.

“To our mind, any market disruption such as Brexit leads to obstacles and opportunities. The clients we deal with are largely entrepreneurs and innovators, who are very much used to spotting the opportunities that others may not. How this influences their investment decision, however, will vary on a case by case basis,” Mr Blewer adds.

Malta sets CBI bar high

Malta is widely considered to have set the benchmark for citizenship-by-investment in Europe. Since the launch of its Individual Investor Program (IIP) in 2014, the island nation has generated around €200m annually, amounting to over €1b in total that has gone into the country’s National Development and Social Fund, according to figures cited by Henley & Partners.

Five years after the launch of the IIP, Malta has one of the highest GDP growth rates — and one of the lowest unemployment rates — of any European Union member state, Henley & Partners adds. Malta registered a €251m budget surplus — the nation’s third consecutive surplus — in 2018, some 76% of which can be seen to derive from the IIP program. Anticipation says that the Maltese government could post its fourth fiscal surplus in 2019.

Henley & Partners says that in addition to reducing the overall debt level by 28%, the surpluses enable large-scale infrastructure projects in the health, tourism, and real estate sectors. Economic growth in 2019 is expected to remain robust, after a slight slowing of 6.2% GDP growth in 2018, making Malta one of the most dynamic countries in the European Union, according to many.

On that note, however, Brexit should not shake the markets considerably. “From the perspective of investment migration, we do not foresee any iteration of Brexit having a significant impact on these figures. Losing visa-free access to the United Kingdom may put some non-European investors off, but essentially all residence- or citizenship-by-investment programmes will be affected equally by this, and when all is said and done, Malta’s Individual Investor Program still remains one of the best offerings available anywhere in the world,” Mr Blewer tells BM.

“When all is said and done, Malta’s Individual Investor Programme still remains one of the best offerings available anywhere in the world.”

In terms of citizenship by investment, Malta has been widely recognised for its scheme. Out of a total of 13 countries investigated, Malta has finished eighth on the recently-published CBI [Citizenship by Investment] Index, as a runner up to Cyprus on the seventh place; the two being the most attractive European countries of all. This makes Malta the second most attractive country for investors seeking citizenship in the region, according to a report recently published by the Financial Times in association with CS Global Partners.

Additionally, on the Henley Passport Index, the Maltese passport has been steadily stepping up, ranking ninth and eighth earlier this year, and currently ranking as the seventh strongest document of all passports around the world. The Henley Passport Index is based on data from the International Air Transport Association (IATA), which maintains the world’s largest and most accurate database of travel information, and is enhanced by ongoing research by the Henley & Partners Research Department.

Britons looking abroad

It appears that British HNWIs are scanning possibilities all around the world fuelled by the prospect of being cut off from the continent. “While it is true to say there are currently more enquiries coming from British passport holders than there were previously, it remains unclear how much of the interest will convert into actual citizenships for Malta or anywhere else. It is important to note that interested Brits do not only have Malta on their radars. Other European countries offering residence and/or citizenship are also courting interest from Brexit-threatened Brits. For instance, Cyprus, Greece, and Portugal are all potential recipients of British investment,” Mr Blewer says.

While pundits ferociously debate whether Mr Johnson is bluffing with a no-deal Brexit — as the scenario could jolt the United Kingdom into long years of recession according to many — or is genuinely ready to make the bold move of abruptly severing ties with the bloc as the clock turns to 1 November; shutting the door from the outside brings too many factors into the game to make certain forecasts.

“There are simply too many variables at this stage to know what a no-deal scenario would look like, including whether or not Britain is able to strike up any attractive post-Brexit trade deals with the United States or any other trade partner. Malta and a number of other European residence- and citizenship-by-investment programmes will remain extremely attractive propositions, regardless of what happens with Brexit,” Mr Blewer says.

Nevertheless, opportunities are plenty in Europe and around the world CBI-wise, therefore, the impact of Brexit — whatever turn it might take — should be insignificant globally on the investment migration space in general.

“Increasing demand, combined with the continual introduction of new programmes, means that the industry will soon reach US$20b annually. As of the beginning of 2019, there have been investment migration programmes in nearly 100 countries, including more than 70% of the European Union member states, with the majority having been up since 2000. It is estimated that investment migration has brought approximately €25b in FDI [foreign direct investment] into EU countries since 2010, and even the industry’s critics acknowledge that residence- and citizenship-by-investment schemes have been fundamental to these countries’ economic recovery following both the global financial crisis and the European sovereign debt crisis,” Mr Blewer breaks it down.

Either way, “it will certainly be interesting to see if and how Brexit affects Britain’s own residence-by-investment programme though, and whether the British government lowers any of their price points in an attempt to encourage inbound investment,” Mr Blewer concludes.

The post Brexit to change CBI playing field, not break it first appeared on The Malta Business Weekly.

The minister also praised the personnel for their proactiveness and their work in this regard when he welcomed Michel Barnier, the EU Chief Brexit Negotiator at the Malta Freeport to discuss Malta’s preparedness for Brexit.

Mr Barnier spoke about the importance of having a single market across the European Union member states. He said the customs department has been very active in protecting consumers and businesses from counterfeit goods, which practice strengthens the principles of a single market, the DOI statement reported.

The finance minister also noted that Malta’s customs department is investing “significant” amounts to intensify operations against smuggling of illegal substances. Last year, the customs department launched its new scanning equipment at the Malta Freeport with an investment of around €2.5m, as well as a dedicated canine unit.

“This investment is bearing fruit. Indeed, last year Malta recorded a record number of drug hauls,” said Mr Scicluna.

The post Malta’s customs department readies for Brexit, says finance minister first appeared on The Malta Business Weekly.

The payment operator and prepaid card issuer is also licensed by the United Kingdom’s financial watchdog; the Financial Conduct Authority. This means that PFS will continue to operate as usual throughout the European Economic Area post-Brexit, the company says.

“The future looks even brighter now for PFS with this announcement. It ensures that no matter what happens with regards to Brexit, our business is prepared for all scenarios and there will be no impact to our customers and partners. We look forward to enjoying an excellent working relationship with the Central Bank of Ireland in the years to come,” says Noel Moran, CEO at PFS.

The company operates from the Innovation Hub in Ireland and its Technology Centre in Malta.

The post Irish fintech PFS bags local licence prepping for Brexit first appeared on The Malta Business Weekly.

With the delayed deadline for a Brexit deal to 31 October, uncertainties around the United Kingdom leaving the bloc have not settled yet. Nevertheless, Revolut says they prepared for any possible scenario. “If the United Kingdom and the European Union strike a deal, or if there’s a period of transitional relief, then we would continue to passport our UK-authorised permissions — via Revolut Ltd — across Europe, and there would be no action required on our customers’ side,” Mr Litsikakis tells BM.

Should the two parties be unable to reach a deal, Revolut has plans in the pipeline. Last year, Revolut Payments UAB was set up in preparation for a no-deal Brexit scenario. Revolut says that although this entity is fully operational, it is only a precautionary measure, for now. “We are pleased to confirm that this new entity is now in beta phase. As we all sit and wait to see what happens, mitigating any disruption to your services is our paramount concern. We will only switch our EEA-based customers over to this new entity in the event of a no-deal scenario,” the country manager responsible for Malta says.

Although an uncertain environment might linger on until at least the 31 October deadline, Revolut says that European customers should rest assured. “We want to assure all of our customers in Europe that we have taken the necessary preparations to ensure that they can continue to use Revolut in the same way, whatever the outcome,” the country manager underscores.

A market of ‘phenomenal’ growth

It is almost impossible to line up for payment at any POS in Malta, seeing not a single individual flashing a Revolut card. It is equally unlikely to carry out a conversation with acquaintances without bumping into Revolut card holders, or people who have at least heard about the concept. What makes the Maltese land such fertile soil for a fintech company such as Revolut?

“The Maltese market is extremely important to Revolut due to a large number of expats, migrant workers and professionals transferring money in and out of the country. So far, Revolut has proved to be incredibly popular in Malta, with over 90,000 customers signed up to date, that is around one-fifth of the population. We are signing up around 200 customers per day and only expect that to increase. Six months ago we only had around 30,000 customers in Malta, so the growth has been phenomenal,” Mr Litsikakis says.

“Revolut has proved to be incredibly popular in Malta, with over 90,000 customers signed up to date, that is around one-fifth of the population. We are signing up around 200 customers per day,”

says Revolut’s Dimitris Litsikakis.

Revolut believes its popularity lies in the “modern design” that their mobile application offers for users, as well as the fact that they issue no hidden fees and sport responsive customer service. Additional features such as instant payment notifications, automatic spending categorisation, budgeting tools, spare change saving and enhanced security further boost their prestige in the eyes of users, the company believes.

Furthermore, Revolut allows users to buy and sell a selection of cryptocurrencies, as well as to get pay-per-day travel insurance through their app. Registration for a Revolut account takes places in approximately ten minutes, and once an account is opened, users can send, spend and exchange 29 currencies in-app and spend fee-free globally in over 150 currencies, up to a threshold of £200 every month on the free plan.

Revolut’s expansion comes in a time when people appear, albeit slowly, to become more open to fintech solutions, as well as they are becoming more conscious about taking elevated control over their finances. “Fintechs are gaining in popularity across the world due to a growing shift of consumers using their phones to handle their finances and demanding more from their banks. They are no longer happy to accept rubbish exchange rates and monthly fees. Fintechs, such as Revolut, offer an alternative to the big banks,” Mr Litsikakis says.

For fuelling further growth, Revolut is planning to host more RevRally [awareness-raising promotional] events this year in Malta to encourage more consumers to open accounts with the company. “In Europe, we currently have over 4.6 million customers and are building a European Growth Machine that will help us scale at speed in every European country where Revolut’s service is currently available to further boost our customer numbers,” the country manager tells BM.

Additionally, Revolut aims to grow out of Europe. They expect to expand into a number of global markets in the coming months, with foreseen launches in the United States, Canada, Singapore, Japan, Australia and New Zealand planned in 2019.

Revolut insists on unshaken compliance

The Telegraph broke the news on 28 February that Revolut was “accused of violating basic banking rules by failing to block thousands of potentially suspicious transactions on its platform,” the report writes. Citing documents The Telegraph says had acquired, the online daily reported that Revolut switched off its system flagging suspicious transfers.

This was briefly followed by news that CFO Peter O’Higgins had resigned from his position at the company. On top of this, Revolut ran into technical issues on 1 March, affecting their app’s functionality including top-ups, exchanges and other features. Revolut’s engineers fixed the issues in a matter of minutes. Nevertheless, some Maltese customers, reading international news and swiftly jumping to unsubstantiated conclusions, ran to ATMs quickly withdrawing money, in the belief that Revolut was going down.

Nikolay Storonsky, the founding CEO of Revolut, soon after the news broke denied reports suggesting that his company would have been involved in activities raising the issue of possible “money laundering”. He also said that no connection could be found between the resignation of his company’s finance chief and the alleged “money laundering”, despite what news reports suggested.

Business Malta asked Revolut to explain the events of end-February and early-March from their perspective. “In the middle of last year, we rolled out a new sanctions screening system in parallel with our existing systems and controls. The new system required recalibration on the basis that it was creating some false positive cases (pending payments),” Mr Litsikakis tells BM about the roots of the events. During this period, Revolut says their 200-strong compliance team reviewed all payments on their platform. “The new system and subsequent recalibration had nothing to do with money laundering, and we want to make it abundantly clear that there were no breaches,” Mr Litsikakis puts his feet down.

“The new system and subsequent recalibration had nothing to do with money laundering, and we want to make it abundantly clear that there were no breaches,”

says Revolut’s Dimitris Litsikakis.

By the second week of March, the Telegraph substantially amended its article and issued a correction statement both online and in their print edition related to news they broke about Revolut.

“We would like to clarify that there never was any lapse in our anti-money laundering controls or our sanction screening process. It is also important to note that a number of articles erroneously conflated our anti-money laundering systems and our sanctions screening process,” Mr Litsikakis insists.

Business Malta was interested to learn about the magnitude of cash withdrawal in Malta at the time of unfavourable news stirring waters among its local users about the company; however, Revolut declined to disclose figures. “We do not share details of how much money is deposited in Revolut,” the company says.

The post Revolut readies intact services regardless of Brexit outcome, eyes further expansion first appeared on The Malta Business Weekly.

The MFSA also emphasised ensuring licenced entities can continue business with minimal disruption is one of the critical objectives for the authority. The MFSA also underlines that any communication they published should be considered “in the context of a no-deal exit scenario” otherwise the communication itself states otherwise.

“Measures taken will be of a temporary nature and remain subject to any decisions and further recommendations as may be made by the three European Supervisory Authorities,” the MFSA says in the press release.

At the same time the MFSA encourages licensed entities to continue feeding the authority with timely and accurate information on any potential consequences that might occur should the United Kingdom leave the European Union without striking a deal.

The post Maltese authority promises to assist local businesses on Brexit first appeared on The Malta Business Weekly.

The sentiment was discussed at this year’s eTrader+ Investor Clinic — dubbed Brexit – from Black Swan to Grey Rhino — organised by Bank of Valletta (BOV) at the beginning of March. The evening conference focused on the possible consequences on financial and foreign exchange markets on Brexit.

“We consider Brexit, from a macroeconomic level, to be mostly a British problem with the risk of contagion close to zero,” said keynote speaker Christopher Dembik, Head of Macroeconomic Analysis at Saxo Bank, according to the BOV press statement. “Our main worry is the lack of new credit growth, which is the United Kingdom’s top issue for medium and long-term macroeconomic outlook,” Mr Dembik added.

Mr Dembik also said that UK-listed companies that are heavily dependent on their local market in terms of revenue are to be most affected, as UK consumption is slowing and household stress in Britain is increasing sharply.

David Pace Ross, Senior Manager at Bank of Valletta, said he believes the political decision of Brexit will “have long-lasting economic and financial ramifications mainly in the UK and to varying degrees, in the rest of the world,” the press statement reports.

Participants of a panel discussion agreed that investors should be aware of the risks that their investment portfolios carry due to the uncertainties of Brexit continuously fluctuating with the political decisions and economic reviews that occur by the day. High volatility in the FX market is expected to linger on, which could impact portfolios that are skewed toward the British economy or the pound, the press statement concludes.

Steve Ellul, Head of Asset Management at BOV, also emphasised that Brexit is chiefly a political event, which is expected to have an impact on the European, as well as the global, economy and financial markets, albeit to a lesser degree than initially anticipated. He argued that corporate and institutional investors are hedging their risks by mitigating exposures to the pound sterling and UK domestic assets, the BOV press statement adds.

Mr Ellul added that local businesses, especially in the tourism sector, have diversified their dependence away from the UK market, which — together with proactive initiatives by Malta Enterprise — helps Maltese firms to weather potential negative repercussions emanating from Brexit.

The post Maltese finance experts expect Brexit to stir UK waters mainly first appeared on The Malta Business Weekly.

“Despite the uncertainty around Brexit, we are still optimistic about the crypto market as this could be a new economic opportunity to both the euro and British pound,” said Andy Cheung, Head of Operations of OKEx. The OKEx chief addressed the issue yesterday in London, during an event dubbed “mindxchange”, discussing blockchain progress in the United Kingdom.

Attendants of the event agreed that as the adoption of blockchain technology is broadening in the United Kingdom, and across the world, prompt action is needed to speed up publishing a regulatory framework in place, the press statement says.

“It has always been delightful to see the crypto community growing. The United Kingdom owns one of the fastest-growing crypto communities in the world. Having observed such great potential, we wanted to support the needs here, and therefore, we launched GBP on our C2C platform,” Mr Cheung concluded.

OKEx is a digital asset exchange headquartered in Malta, offering digital assets trading services including token trading, futures trading, perpetual swap trading and index tracker to global traders with blockchain technology. Currently, the exchange offers over 400 token and futures trading pairs enabling users to optimise their strategies. The company says their platform serves “millions of customers from over 200 countries and regions”.

OKEx recently launched the British pound (GBP) and the Thai baht (THB) as two new currencies available for trade on its over-the-counter (OTC) platform, which is often tagged as a fiat-to-cryptocurrency platform. “Thailand and the UK own the fastest-growing crypto communities in the world. We see great potential in these two markets and want to support the needs there,” Mr Chueng said at the time of launching GBP and THB.

The post Maltese DA exchange OKEx believes in UK despite Brexit doubt first appeared on The Malta Business Weekly.

“The ball is in the UK’s court after its Parliament voted against the present deal with the EU. It also voted against leaving the EU without a deal. So the current situation means the UK needs to either accept the deal or not exit the EU at all”, the Prime Minister said, according to the press statement.

He said the European Union would not change its position for not to compromise the principles it is built upon. “It is not a case of stubbornness by the EU, but a case of being realistic,” the prime minister said.

PM Muscat explained that there are some challenges for the United Kingdom if given an extension. “Primarily, the EU treaties are clear: the UK will be expected to organise the European Parliament elections in May, even though these will not have any relevance in the long-term. It is also clear that the UK cannot have a veto on an EU budget that it will not be part of.”

The post Malta confirms commitment to support Brexit extension first appeared on The Malta Business Weekly.