Payments News

August 12, 2019

TOP POST

Glenbrook

Why Talk About Risk in Payments?

Payments Views

“Let’s be honest, risk is not the first topic people gravitate to in payments. It’s much cooler to talk about open banking, fret about PSD2 implications, or ponder the pros and cons of a cashless society. Even risk managers I know tend to keep quiet about risk – especially at social events. So why are we running a one-day workshop about risk in payments?”

On The Web

Opinion

Payments Companies Like Square, Skrill And Circle Now Driving The Bitcoin Revolution

Forbes

“Banks began seeing cryptocurrencies as a non-event, then they decided to laugh at it – Jamie Dimon’s anti-Bitcoin rhetoric springs to mind – then they began fighting it by putting out their own coins – JPM coin – which I think we can all call a win for Bitcoin.   For payments companies, it has been a similar path, except I would add another step in there as the likes of Square, Skrill and Circle are actually starting to champion Bitcoin and are backing the digital currency to be the next big thing in the payments space.”

Risk & Fraud

Mexico Commerce Upended With Part of Banking System Offline

Bloomberg

“Problems at a Mexico City data-processing center caused widespread failure across the nation’s banking system on Saturday, with companies and consumers reporting a spike in declined payments and transactions.  Banks including Grupo Financiero Banorte SAB and the Mexican units of HSBC Holdings Plc and Banco Santander SA reported the problems on Twitter. The issue was tied to an electronic-payments company, Prosa, which said in a statement it had experienced problems at a data center. Banks later said the services have resumed.”

Risk & Fraud

Mexico Considers Banning Cash for Gasoline Purchases, Highway Tolls

Bloomberg

“Mexico is considering a ban on the use of cash for purchasing gasoline and to pay for tolls as a way to fight tax evasion and money laundering, according to people with direct knowledge of the discussions. The plan, which has been discussed between the banking industry and the government, hasn’t been fully approved. A final decision may not be taken until after the central bank rolls out its digital payments platform known as CoDi next month which is part of a broader government program to push more Mexicans into the banking system and cut down on cash, said the people who asked not to be named, since the plan isn’t public.”

Systems

China’s Central Bank Digital Currency Is “ready” After 5 Years of Development

The Block

“Mu Changchun, Deputy Chief in the Payment and Settlement Division of the People’s Bank of China (PBOC,) stated that the CBDC prototype exists and the PBOC’s Digital Money Research Group has already fully adopted the blockchain architecture for the currency. China’s CBDC will not rely entirely on a pure blockchain architecture, as this would not allow the currency to achieve the throughput required for retail usage.”

Systems

Venmo Launches Instant Transfers to Bank Accounts

TechCrunch

“The news of an expanded Instant Transfer service comes at a time when Venmo is seeing increased competition from rivals, including Square’s Cash App and the bank-operated Venmo challenger, Zelle. Thanks to its built-in customer base and integrations with U.S. banking apps, Zelle reported $44 billion sent on 171 million transactions in Q2 2019, making it the largest peer-to-peer payment app in the U.S. by a wide margin. Venmo’s payment volume in Q2, meanwhile, was $24 billion . However, with more than 40 million active accounts, Venmo has more users than some of the U.S.’s bigger banks. And it’s still growing.”

Tech

QR Code Payments Make Long Commutes Even Longer in China

Abacus

“The ubiquity of mobile payments in China means that when it comes time to pay, most people are tapping through their phones to get to the right app and pull up the QR code. Companies have even found workarounds to allow refreshing the codes when users are offline, like during a flight without Wi-Fi .  But typically, generating and scanning a QR code is quick, and it was a cheap technology to implement. Once it became the default payment system, it was only a matter of time before it started invading public transportation. This is in spite of the fact that that NFC (near field communication), which is used by Apple Pay and Google Pay (among many others), is considered faster and more secure and has even proliferated in China over the years as costs have come down.”

Tech

Hey Google, Lend Me a Tenner? NatWest Trials Voice Banking

The Guardian

“Get ready to say: “Hey Google. How much do I have in my bank account?” NatWest is to begin voice-only banking that will give customers direct access to their accounts by talking to the Google Home smart speakers now in millions of British homes. The trial – the first by a UK high street bank – will let customers ask Google “What’s my balance?”, “What’s my latest transactions?” and “What’s my pending transactions”. Google devices will answer verbally, and also flash the answers up on the customer’s smartphone.”

Tech

Cashierless Stores Make Inroads in U.S.

Wall Street Journal (paywall)

“The concept got a push from Amazon Go stores, which Amazon.com Inc. launched in early 2018 ; there are now 15 stores, with two opening last week, in New York and San Francisco. Amazon Go relies on hundreds of cameras and sensors in each store to identify products that customers take off the shelves. Shoppers typically scan a code to enter the stores.”

  • Tags:
  • AI

On The Wires

Deals

KKR to Acquire Majority Stake in German Fintech Heidelpay From AnaCap

“heidelpay Group (“heidelpay”) and its majority shareholder AnaCap Financial Partners (“AnaCap”), a European financial services specialist investor, have today reached an agreement on the terms of an investment from KKR, a leading global investment firm. KKR will acquire a majority shareholding in the company, with Mirko Hüllemann, founder and CEO of heidelpay, and other key managers remaining as long-term shareholders…heidelpay currently serves more than 30,000 retailers and marketplace operators, focusing on SMEs and corporates.”

Use

HSBC Bank’s Personal Lending Platform Goes Live

HSBC Bank USA , N.A., (HSBC), part of the HSBC Group, one of the world’s largest banking and financial services organizations, today launched its digital lending platform powered by industry-leading end-to-end technology platform Amount . The new digital lending platform provides U.S. consumers a simple way to apply for personal loans online.”

August 9, 2019

TOP POST

Glenbrook

Episode 99 – Reducing Chargeback Handling Pain – Rick Lynch, Verifi

Payments On Fire

“In this Episode 99 of Payments on Fire® we talk with Rick Lynch, VP of Business Development from Verifi , about the impact of chargebacks on merchants and issuers. He updates us on rule changes by Visa and Mastercard. And he addresses the process and techniques al approaches needed to handle these post-authorization events. While only mentioned in passing during the episode, Verify is being acquired by Visa , in another example of expansion by card network operators into adjacent payment ecosystem roles.”

On The Web

Deals

Toss Operator Viva Republica Secures $64m at $2.2b Valuation

The Korea Herald

“South Korean unicorn startup Viva Republica, the creator of mobile financial service platform Toss, has secured $64 million at a valuation of $2.2 billion in recent fundraising led by Hong Kong-based equity investment firm Aspex Management, the company said Aug. 8. Joined by returning investors, this round will bring the total raised to date to about $250 million.”

Deals

Keith Rabois, BoxGroup Back New York-based Brex Competitor

TechCrunch

“Considering its unparalleled success, it was only a matter of time before a Brex copycat emerged. Ramp Financial, a new startup led by Capital One-acquired Paribus founders Eric Glyman and Karim Atiyeh (pictured), has raised $7 million, TechCrunch has learned. The capital came from Keith Rabois of Founders Fund, BoxGroup’s Adam Rothenberg and Coatue Management, a hedge fund that recently launched a $700 million early-stage investment vehicle.”

Deals

India’s Lendingkart Raises $30M to Help Small Businesses Access Working Capital

TechCrunch

“As India continues its race to adopt digital payments at a pace and scale seen rarely worldwide, the country’s startups are quickly building solutions to bring financial services to businesses. And they are attracting significant capital from local investors and global giants to scale their ambitions. Lendingkart , one of the many startups in the country that is helping micro, small and medium-sized enterprises access working capital , has raised $30 million as part of its Series D financing round, it said on Friday. Existing investors Fullerton Financial Holdings, Bertelsmann India Investments, and India Quotient funded the round. The five-year-old, Bangalore-based startup has raised $143 million to date.”

Domains

Banks Near Zero Hour on $124 Trillion of Flows

Bloomberg

“While exorbitant currency spreads and hefty bank charges are the norm for payments that cross national borders, the impression that they mostly affect individuals is wrong. Annual people-to-people transactions amount to $400 billion a year. People-to-business payments – like sending fees to schools overseas – come to another $1.5 trillion. Those are substantial figures, but they pale before the $124 trillion of business-to-business transfers, according to McKinsey & Co.”

Providers

Square Brings New Checkout Device to Canada As Competition Increases – BNN Bloomberg

BNN Canada

“Square Inc. (SQ.N), which started about a decade ago with a smartphone-based credit card scanner used mainly by small businesses, has launched a device in Canada aimed at disrupting a market of larger retailers dominated by Canadian banks. Square’s white plastic device, called the Terminal, replaces the physical keypad design with a glass touch screen that it says allows for more clarity at checkout with a variety of display options, such as a full breakdown of the bill.”

Providers

Goldman Sachs, Bank of the Rich and Powerful, Is Dipping Into Subprime Lending With Apple Card

CNBC

Goldman Sachs is casting a wide net for customers of its new credit card with Apple , approving some subprime borrowers for the product. The bank, which is in charge of deciding who gets the Apple Card, is accepting some applications from users with less-than-stellar credit scores, according to people with knowledge of the matter. Goldman began to make the card available to some Apple customers this week ahead of a broader rollout later this month.”

Reports

Mobile Contactless Payments Will Account for Less Than 2% of US Retail Sales This Year

Forbes

“The push for mobile contactless payment adoption in the US has been a decade-long journey entailing a multibillion-dollar investment in wallet development, POS hardware and consumer marketing. To date, the results have been underwhelming, with payment methods like Apple Pay and Google Pay forecasted to account for just 1.6% ($78.6bn) of US brick-and-mortar retail sales this year, according to 451 Research’s Global Unified Commerce Forecast . Consumer payment habits die hard, and without a measurably better value proposition, habitual behaviors like reaching for a card from a leather wallet will beat out mobile alternatives every time.”

Security

BKash Launches EKYC App for AC Opening

Dhaka Tribune (Bangladesh)

“Mobile financial service provider, bKash launched e-KYC (Electronic-Know-Your-Customer) app so that customers can open their account by themselves. The eKYC app would allow customers to open their bKash account with instant activation only scanning NID and taking photo without any documents, said a press release yesterday. Using OCR (Optical Character Recognition) to collect data from NID, face detection technology and cross matching data with Election Commission (EC) database, the app is making the whole system more integrated and less operational complexity.”

Use

Mobile Banking Brings Sea Change in China’s Financial System

Nikkei Asian Review

“Farmers and microbusinesses that previously had trouble getting loans from conventional banks are reaching out to Alibaba and Tencent for help. Both companies make their lending decisions by processing vast amounts of information using artificial intelligence from mobile payments worth nearly $25 trillion per year. Both companies control more than 90% of the market for smartphone-based payments which totaled more than 170 trillion yuan ($25 trillion) in 2018.”

Use

Uber Says It’s Having Some Success in Reducing Payment Card Costs

Digital Transactions

“Uber didn’t disclose card-acceptance costs in its latest financial report, but Digital Transactions News estimates the bills total at least $1 billion a year. That estimate is based on figures from the registration statement Uber filed ahead of its May initial public offering of stock. The document said Uber paid $749 million in credit card processing fees in 2017, up 62% from $461 million in 2016. While the filing didn’t give 2018 acceptance figures, it did say 87% of Uber’s gross bookings last year were on credit or debit cards.”

On The Wires

Uncategorized

Wirecard Offers Fully Digital Payout Solution in North American Consumers With Mobile App Launch

Wirecard

“With the new Wirecard app, cardholders can seamlessly track related balances and payment activities on their mobile device, benefiting from digital personal finance mangement. The mobile app is part of Wirecard’s drive to advance the digital transformation of payments and build a more integrative financial experience globally. In designing the app, Wirecard included the flexibility to cobrand with its clients, while keeping end-users’ needs and preferences in focus.”

August 8, 2019

On The Web

Domains

Paytm’s Mobile Payments App PayPay for Japan Reaches 10 Million Users

TechCrunch

Paytm, India’s biggest mobile payments firm, now has 10 million customers in Japan, the company said as it pushes to expand its reach in international markets. Paytm entered Japan last October after forming a joint venture with SoftBank and Yahoo Japan called PayPay. In addition to 10 million users, PayPay is now supported by 1 million merchant partners and local stores in Japan, Vijay Shekhar Sharma, founder and CEO of Paytm said Thursday. The mobile payments app has clocked over 100 million transactions to date in the nation, he claimed . In June, PayPay had 8 million users.”

Risk & Fraud

Instagram’s Lax Privacy Practices Let a Trusted Partner Track Millions of Users’ Physical Locations, Secretly Save Their Stories, and Flout Its Rules

Business Insider

“A combination of configuration errors and lax oversight by Instagram allowed one of the social network’s vetted advertising partners to misappropriate vast amounts of public user data and create detailed records of users’ physical whereabouts, personal bios, and photos that were intended to vanish after 24 hours. The profiles, which were scraped and stitched together by the San Francisco-based marketing firm Hyp3r, were a clear violation of Instagram’s rules. But it all occurred under Instagram’s nose for the past year by a firm that Instagram had blessed as one of its preferred “Facebook Marketing Partners.”

Systems

Credit Card Companies Forbid Bitcoin Purchases—with Good Reason

Quartz

“Prohibiting crypto purchases could be a matter of safety (bitcoin’s price is notoriously volatile), but it also prevents consumers from gaming the cards’ reward systems. If you were allowed to buy—and instantly sell—thousands of dollars of bitcoin, theoretically, you could generate a cash-back return without incurring much risk. It would be roughly equivalent to printing money. Of course, credit cards also carry the risk of default. In 2017, a survey of 672 bitcoin buyers by LendEDU found that 18% of respondents used a credit card to fund and purchase their digital currency. Of that group, 22% reported not  paying off their balances after buying bitcoin—a small but not insignificant fraction. “

Tech

Visa to Test Advanced AI to Prevent Fraud

Wall Street Journal (paywall)

Visa Inc. is rolling out a platform to help its engineers quickly test advanced artificial-intelligence algorithms aimed at detecting and preventing credit-card fraud. The platform, built in house and slated to be launched later this year, is an example of the broader financial-services industry trend of using AI to detect patterns in transactions that could signal criminal behavior. The platform is cloud-based, meaning that Visa’s researchers and engineers can access it online from anywhere.”

  • Tags:
  • AI

On The Wires

Deals

FreshBooks Announces Strategic Investment From JPMorgan Chase

“The investment from JPMorgan Chase follows two previous institutional funding rounds for FreshBooks, including a $30 million USD ($40M CDN) Series A funding round in July 2014, and a $43 million USD ($57M CDN) Series B funding round in July 2017. As part of the investment, a JPMorgan Chase representative will be joining FreshBooks’ board of directors. FreshBooks announced its completely redesigned and rebuilt platform in September 2016 and has since added more than 100 new apps and integrations to help customers automate more of their workflow. Integrations include G Suite by Google Cloud, Slack, Gusto, HubSpot, Shopify, MailChimp, ZenDesk, MileIQ, Proposify, Trello, Basecamp, Asana, and more. In February 2019, FreshBooks announced the addition of bank reconciliation and double-entry accounting to its software, enabling growing businesses to scale on FreshBooks with confidence and work seamlessly with an accountant.”

Tech

Bottomline Announces Open Banking API Suite

GlobeNewswire News Room

“Bottomline Technologies (NASDAQ: EPAY), a leading provider of financial technology solutions that help make business payments simple, smart and secure, today announced the launch of its Digital Banking IQ Intelligent Engagement suite, which empowers banks to engage intelligently with customers, deliver a unified digital experience, and acquire, deepen and grow profitable relationships.”

Tech

Commerzbank tests blockchain-based machine-to-machine payment solution for the first time

“Working together with its research and development unit main incubator, Commerzbank is the first German bank to develop a blockchain-based payment solution for machine-to-machine (M2M) payments. A fully automated payment process between an electric charging point and a Daimler truck system has taken place. For this transaction, Commerzbank issued Euros on a blockchain and provided Daimler Trucks with “cash on ledger” (i.e. the money on the blockchain) to process the payment.”

August 7, 2019

TOP POST

Regulation

SCA Delayed by a Further 18 Months

Electronic Payments International

“The Financial Conduct Authority (FCA) has delayed the enforcement of strong customer authentication (SCA) by a further 18 months. The SCA delay comes after a number of warnings that the new EU online regulations, which are designed to reduce fraud, could cause online sales to suffer. As reported by the Financial Times, SCA was set to be carried out in September 2019. However, this date came under fire from critics who claimed companies did not have enough time to prepare.”

On The Web

Companies

Payments Giant Stripe Adds to Global Expansion Spree With First Office in Latin America

CNBC

“Multi-billion dollar payments start-up Stripe is expanding its quickly growing global footprint with a flagship office in Latin America. Stripe, which has become one of the most sought after payment start-ups in Silicon Valley, announced Tuesday it was opening an office in Mexico City to attract engineering talent and capitalize on the mobile-payment and e-commerce growth in the region.”

Companies

Consumers Are Receptive to the Unconventional Apple Card, Separate Studies Show

Digital Transactions

“Apple Inc.’s new Apple Card is an unconventional animal with what some observers call ho-hum rewards, but separate studies released Wednesday show the card nonetheless could make a big splash. Research firm J.D. Power said its late June survey found “awareness is already remarkably high” for a product that offers “middle-of-the-road” rewards compared with other cards.”

Deals

KKR to Acquire Majority Stake in German Fintech Heidelpay From AnaCap

yahoo

“heidelpay Group (“heidelpay”) and its majority shareholder AnaCap Financial Partners (“AnaCap”), a European financial services specialist investor, have today reached an agreement on the terms of an investment from KKR, a leading global investment firm. KKR will acquire a majority shareholding in the company, with Mirko Hüllemann, founder and CEO of heidelpay, and other key managers remaining as long-term shareholders.”

Deals

Klarna Becomes Europe’s Most Valuable Fintech Firm With New $5.5 Billion Valuation

Forbes

“Swedish payments startup Klarna has raised $460 million from investors who valued the company at $5.5 billion, some $2 billion more the next most valuable consumer-facing fintech firms in Europe—currency exchange app TransferWise and mobile banking app N26. Klarna’s platform allow’s people to “shop now and pay later”. Shoppers can choose to pay the full amount off within 30 days, or through several instalments over a period of months.”

Security

Mastercard Launches Authentication Solution for Online Shopping in India

Cards International

“With the latest offering, Mastercard aims to address 20% of mobile e-commerce transactions which are abandoned midway. Most of these transactions are abandoned due to time-consuming payment processes and mobile network fluctuations. Identity Check Express is equipped with device intelligence and behavioural biometric technologies. It also complies with the latest EMV 3-D Secure and FIDO authentication standards.”

Systems

Fed’s Real-Time Payments System to Compete With Wall Street

Bloomberg

“The Federal Reserve , rebuffing an intensive Wall Street lobbying campaign, plans to create a real-time payment system that will compete with a venture formed by big banks.    The FedNow Service, set to begin operating by 2023 or 2024, will modernize the payments infrastructure by allowing money to be moved almost instantly at every hour of every day, the regulator said in a statement Monday. The system could give consumers and businesses more flexibility in managing money and making time-sensitive payments, the Fed says.”

On The Wires

Systems

The Clearing House Remains Focused on Operating and Growing the RTP® Network | The Clearing House

The Clearing House

“We are already seeing how these real-time capabilities are providing for tremendous advances in speed, convenience, and security in how Americans receive and send funds. We are excited about the many ways that this revolution in payments will continue to deliver new benefits to depository institutions and their customers. While we will stay abreast of the Fed’s efforts to develop its own real-time payments system which may become available in 2023 or 2024, our focus will remain on ensuring that the RTP network has reach to all depository institutions.”

Use

Verishop and Affirm Partner to Enable Customers to Shop Now and Pay Over Time

“Through Affirm’s consumer-friendly alternative to traditional credit cards, Verishop customers now have a simple, no-interest payment option1 allowing them to spread out the cost of a purchase over three easy, monthly payments. Whether a customer is redecorating their home, finding that perfect outfit or maintaining their beauty routine, the partnership with Affirm can help Verishop customers shop for all their lifestyle needs with confidence.”

August 6, 2019

On The Web

Companies

The Apple Card Starts Rolling Out Today

The Verge

“Apple says a random selection of people who signed up to be notified about the Apple Card will be invited to sign up today, although the company won’t disclose exactly how many people will be in the preview group. The signup process, which requires iOS 12.4, involves entering your address, birthday, income level, and last four digits of your Social Security number. That information is sent to Goldman Sachs, which will approve or decline your application in real time — Apple says it should take less than a minute. (There’s a TransUnion credit check involved, so if you’ve locked that info you’ll have to unlock it.)”

Domains

Citi Hong Kong Announces New Digital Payment Solution That Enables Credit Cardholders to Settle Big Ticket Payments on Citi Mobile App

Crowdfund Insider

“Citi Hong Kong announced last week the launch of Citi PayAll, a payment solution that enables Citibank credit cardholders to settle one-off or recurring payments on the Citi Mobile App using their credit card while earning Points at the same time. According to Citi Hong Kong, the types of payment Citi PayAll covers include monthly rental, monthly carpark fees, residential property management fees, and tuition fees. It was noted that clients no longer need to settle these transactions using cash, checks or autopay, giving them more autonomy and flexibility in payment options.”

Regulation

Govt Unveils Draft E-commerce Norms

Hindu Business Line (India)

“To protect consumers’ interest, the Centre has proposed guidelines for e-commerce firms that entail a 14-day deadline to effect refund request, mandate e-tailers to display details of sellers supplying goods and services on their websites and moot the procedure to resolve consumer complaints. The consumer affairs ministry has sought views of stakeholders on the draft guidelines on e-commerce by September 16. Meanwhile, the government is planning to come out with a national e-commerce policy to facilitate achieving holistic growth of the sector.”

Uncategorized

Klarna Raises $460m to Support US Growth

Retail Systems

“Klarna has raised $460 million in an equity investment round, at a valuation of $5.5 billion, to help fund its push into the US market.The round was led by Dragoneer Investment Group, alongside Commonwealth Bank of Australia, HMI Capital, Merian Chrysalis Investment Company, Första AP-Fonden (AP1), IPGL, IVP and funds managed by BlackRock. This investment follows funding in April that closed above the company’s $100 million target, driven by strong demand from Klarna’s existing investor base.”

Use

100 Million Transit Riders Are Paying With WeChat Mini-Program: Tencent

Caixin Global

“Tencent’s WeChat mini-program “Ride Code” has reached 100 million users, Tencent Financial Technology announced Tuesday, exactly two years since its debut in July 2017. Ride Code allows subway and bus riders to pay for transit fares with QR codes directly upon boarding in various Chinese cities. At subway stations, that means showing your barcode at the turnstile. Riders do not need to visit ticket kiosks as the fare is deducted from their WeChat Pay wallet.”

On The Wires

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