InsurTech adherents must see- the Elephant is insurance

A common approach to InsurTech- describing insurance by parts, not the whole

I’ve noted in the past that InsurTech is not dissimilar to the fable of six blind men describing an elephant solely on touch- each man ‘sees’ the elephant from the perspective of his narrow exposure to a very large creature. One sees a rope because he has grabbed the tail, another a tree because he’s grabbed a leg, another a snake due to the feel of the trunk, and so on.

InsurTech is that similar situation- many firms ‘touching’ the initiative from a narrow perspective. Not blind, surely, but not from a vantage of ‘seeing’ the entire concept. Of course it would be very daunting to try to grasp the industry from all angles, and very expensive too.

So, there are the individual firms describing their unique parts- underwriting, pricing, distribution, administration, claims, agencies, customer acquisition, etc. And designing and/or applying technology- artificial intelligence (AI), machine learning, IoT, algorithms, data science, actuarial science, behavioral economics, game theory, and so on. Using technology and new methods to help them see their part of the beast that is insurance innovation.

We get caught up in the thinking that InsurTech is a discrete concept– because each involved player has his unique approach to defining how change will be effected (and we can’t have multiple terms to describe what the movement is.) In the end each is convinced the efforts being made in their firm are defining the term. A recent article penned by Hans Winterhoff, KPMG Director, 3 Lessons European Insurers can Learn from Ping An, provides suggestions for legacy insurers based on successes Ping An has had in the China insurance market. The author makes three apt points but as with simply grabbing the Beast’s trunk and calling the animal a snake, is Ping An’s approach to insurance innovation the best InsurTech perspective for mature insurance markets?

Can the best innovative methods be applied to incumbent markets if a carrier’s staff are not engaged adequately in the evolution? 

Legacy markets are populated with customers who are content with the Beast that is insurance, and in spite of some years of InsurTech efforts the market penetration of innovative companies remains low.  Not that these customers don’t deserve the latest and best methods (surely most would trade the bureaucracy and cost of existing health care for the ease of service provided by a Ping An kiosk), but change must also come from within insurance company organizations.  If one looks at Fortune magazine’s best large employers by employee survey and finds two of the insurance market’s biggest employers, Allstate and Geico, not in the top 500 firms, one must consider absent employee engagement then innovative change may be inhibited for those major companies and their customers.

Virtually every week there is a significant conference of InsurTech enthusiasts, thousands of attendees per month, all seemingly with an idea of what InsurTech is, where it’s going, and how they will capture innovation lightning in the bottle they have designed. There are some very smart persons who are seen as champions of the effort, and these persons publish/travel/post and remind the industry of where it has been and where it’s going. They are adept at describing the beast in terms that most can understand, and in terms that help the holder of the ropy tail to see that there also is a snaky trunk, and that the two parts are of the same beast.

What is cool about how the InsurTech movement is evolving is that a solid recognition is being realized by most (not all) that InsurTech is comprised of multiple, important and integral parts, and even if your firm is not working with idea A, it can leverage the knowledge in developing idea B. We pick at the theories others espouse, nay say, comment, maybe even doubt or criticize, but at the same time all the knowledge is to the common goal- improving a product for the existing and as yet unidentified insurance customers.

And without belaboring the theme, we can be reminded that the elephant is not InsurTech; the elephant is insurance. InsurTech is the trappings with which the elephant is enhanced. And the elephant is the contractual agreement that comprises insurance, and the elephant’s handler must be the customer. 

Let’s all describe the beast well from our unique perspective, with the understanding that in the end the elephant’s handler- the customer- must be why we are touching the beast at all.

image source

Patrick Kelahan is a CX, engineering & insurance professional, working with Insurers, Attorneys & Owners. He also serves the insurance and Fintech world as the ‘Insurance Elephant’.

I have no positions or commercial relationships with the companies or people mentioned. I am not receiving compensation for this post.

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PayPal Q1 Payments Volume Dips, Venmo User Base Grows

Payments app Venmo reached 40 million users at the end of Q1.

This is the first time parent company PayPal has revealed any user numbers for the app, with its Q1 earnings report showing that the total payments volume for Venmo grew 73 percent year over year to reach $21 billion. The company added that Venmo is on track to generate $100 billion in payments volume this year.

“Venmo continues its significant momentum,” said PayPal CEO Dan Schulman, according to CNBC. “As user growth continues to accelerate, merchants are increasingly turning to Venmo as a way to attract a valuable and engaged consumer base.”

The app — which allows users to comment on payments and see what friends are spending on — has secured partnerships with merchants, including Chipotle, Grubhub and Uber. These relationships are an important way for Venmo, which is not yet profitable, to bring in revenue.

While Schulman noted that the app is expected to make $300 million in revenue this year, the company would not say when it is expected to turn a profit.

“We’re certainly pleased with the monetization of Venmo, and the rate at which that is progressing,” said PayPal Chief Operating Officer Bill Ready.

He also addressed a recent report that said the company was looking to launch a Venmo-branded credit card, which would be in addition to its already existing debit card.

“We have certainly seen great demand across our user base for more and more products from Venmo, and we are engaging with the banking system in a very broad way across PayPal and Venmo,” Ready said. “To be very clear, there is nothing beyond Venmo debit card that we are looking at at this time.”

PayPal’s Q1 earnings beat analyst expectations, with adjusted earnings of $.78 per share, compared with the $.68 per share forecast by Refinitiv consensus estimates. Revenue for the quarter was steady with Wall Street’s $4.13 billion estimates. Total payments volume came in at $161 billion, a 25 percent increase year over year, but below the $163 billion that analysts expected.

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Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

Facebook Touts Payments and Privacy with Q1 Results

More consumers keep using Facebook even as the social network said on Wednesday (April 24) that it faces a fine of between $3 billion and $5 billion from the Federal Trade Commission over privacy. Indeed, even as Facebook reported not only gains in users but mobile advertising for the first quarter of 2019, CEO Mark Zuckerberg put a spotlight on digital privacy when discussion his company’s latest financial results.

The anticipated and one-time fine that Facebook will pay to the FTC stems from the agency’s  investigation into Facebook’s privacy practices. The federal agency has accused the social media platform of violating a privacy consent decree from 2011. Facebook allegedly said it would take certain measures to protect user privacy and their data Since then, Facebook has been accused of mishandling user data in the Cambridge Analytica scandal.

A judge would have to approve any settlement between the two parties, which would likely include the fine and changes to Facebook’s business practices. The FTC could also subject the social media giant to tougher checkups to prove it is complying with the settlement. Facebook executives, during the conference call with investors after the earnings release, declined to give more details about the potential fine.

Largest Fine

So far, the largest fine the agency has imposed on a tech company was the $22.5 million Google paid to settle a consumer data probe in 2012.

That news about how much Facebook expects to pay the FTC to settle those issues came as the social media platform disclosed that its daily active user base increased 8 percent year over year in the first quarter of 2019, to 1.56 billion on average as of March 2019. Monthly active users stood at 2.38 billion as of March 31, 2019, representing an 8 percent increase year over year — and bolstering theories that despite the recent Facebook controversies over user privacy and data, consumers are not fleeing the social media platform.

Privacy Push

But Facebook, like so many other digital firms, especially the biggest ones, is trying to get ahead of regulators and even find an edge as more consumers voice concerns about online privacy. During that post-earning conference call, Zuckerberg touted a fledgling and ongoing effort at Facebook to create what he called the “digital equivalent of the living room,” as opposed to the “public square” that most of social media is now.

Facebook, he said, wants to build services and platforms around the idea of offering more privacy — more specifically, that means what he called “intimate spaces” online, encryption,  and not keeping around post, messages or even consumer data “for longer than necessary.” That also means, he said, making sure data is stored in countries where the conditions are most favorable for security — that is, avoiding places where laws or political instability might tempt officials to violate that data security.

“In the next few years, we’ll be building around those things,” Zuckerberg said, offering no more specifics. He also renewed his called for standard, widespread privacy protections, in the manner of Europe’s General Data Protection Regulation (GDPR).

Payments and Messaging

When talk turned to payments during that Wednesday call, Zuckerberg sought to tie that issue to privacy after an investor asked about the progress of payments and commerce services via the Facebook-owned WhatsApp messaging app. India is one of the top places where Facebook is trying to use WhatsApp to gain more power in digital commerce and payments, though Zuckerberg offered no specifics about how things are going with that.

“The goal would be to have something were you can do (product) discovery though the broad town square on platforms like Instagram,” he said, then have those consumers use Facebook’s private messaging tools to complete transactions and build tighter relationships with specific merchants. That is certainly not a new vision but is does underscore one of the major themes in the Wednesday call, the one overshadowed by that looming FTC fine — privacy.

A fair part of the call was taken up by Facebook’s optimism about the commerce and payments potential of Instagram — even as, yet again, few hard details were offered. For instance, a relatively new Instagram feature  Checkout, enables users to browse and purchase products from 23 participating U.S. brands. Facebook executives seemed pretty happy with the progress on Checkout so far but said it was too early to share meaningful metrics.

Revenue Gain

Even with the expected FTC fine looming for Facebook, investors seemed pleased with the social medial platform in after-hours trading, sending the stock price up at least 6 percent.

For the first quarter of 2019, Facebook reported a 26 percent year-over-year revenue gain, to nearly $15.08 billion. That beat the Refinitiv forecast of $14.98 billion. The daily and monthly active user bases pretty match analyst forecasts, and the Q1 average revenue per user stood at $6.42, beating out the $6.39 analyst forecast. For mobile advertising, Facebook said that in Q1, it accounted for 93 percent of all advertising revenue, up from 91 percent for the same period last year.

Next up for Facebook comes more work on privacy, and more data about its efforts to gain more power in payments and commerce.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

Expensify Integrates with Southeast Asia Ridesharing Company Grab

Expense tracking software company Expensify has integrated with Southeast Asia-based ridesharing startup Grab to automate expense tracking and rideshare reimbursement for Grab users.

When they connect their Expensify account to their Grab business profiles, Expensify customers who live in or travel to Singapore, Malaysia, Indonesia, Philippines, Vietnam, Thailand, Myanmar, and Cambodia can automatically create and submit expense reports for their Grab rides. Upon booking rides in Grab’s mobile app, the receipt for the trip is automatically sent to Expensify.

Expensify opted to integrate with Grab because receipt volume for the ridesharing platform grew 200% in 2018. “Business travel has become one of Grab’s priority segments, with more users discovering and using Grab Business Profiles every day,” says Shawn Heng, Regional Head of Business Development and Grab for Business. “Partnering with Expensify, a great app for anyone who needs to keep track of receipts and expenses, is an exciting next step to make business travel even smoother for all of Grab’s customers.”

Grab is not the first ridesharing company Expensify has integrated into its platform. The California-based company integrated with Uber in 2016 and with Lyft in 2017. Today’s deal does, however, mark the company’s first partnership in the Southeast Asia region. Expensify also has partners in the U.S., the U.K., and Australia.

Founded in 2008, Expensify most recently demoed at FinovateSpring 2013, where the company’s CEO David Barrett showed off invoicing technology. The company teamed up with rapper 2 Chainz and actor Adam Scott earlier this year to create a SuperBowl ad. You can check it out below:

Wirecard Defends Auditing Practices

Wirecard has denied claims levied by the Financial Times that its subsidiaries were not audited, according to a report by Reuters.

The FT, using a whistleblower as a source, said that Wirecard’s accounts in Card Systems Middle East in Dubai were not audited in 2016 and 2017.

“All subsidiaries of Wirecard, including Card Systems Middle East, are subject to regular audit procedures, including but not limited to quarterly and annual audits,” the company said in response to the claims.

Citing documents it said it received, the FT said the majority of Wirecard’s reported profits originated from three partner companies, and that most of those profits had been booked through Card Systems.

Wirecard responded to the FT story by saying that it had “many false and misleading statements.” Shares in the company closed 8.5 percent higher, which is in addition to the stock gaining around 15.5 percent recently.

In other Wirecard news, on Wednesday (April 24), Wirecard and Japan’s SoftBank Group announced a deal in which SoftBank will invest about EUR 900 million in Wirecard.

In a press release, the companies said the investment will come via a convertible bond mechanism. On Tuesday (April 23) Bloomberg reported a deal between the two was imminent. Wirecard said under the deal it will issue convertible bonds to SoftBank with terms of five years. It is convertible for about 5.6 percent of Wirecard stock at EUR 130 per Wirecard share.

Shareholders of Wirecard have to sign off on the deal at the company’s annual shareholder meeting on June 18. The two companies also inked a partnership for digital payment solutions in which SoftBank will support Wirecard’s geographic expansion in Japan and South Korea.

The two firms will also look for ways to collaborate in digital payments, data analytics artificial intelligence (AI) and other digital financial services. They are also expected to jointly explore new product and service offerings in digital lending.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

Financeit to Power Mobile POS Financing for ServiceTitan

Point of sale lending company Financeit teamed up with ServiceTitan this week to help Canadian home service contractors offer their homeowner clients immediate, integrated financing options.

“Alleviating home renovation debt and accelerating the home improvement business is an important focus for Financeit,” said the company’s Founder and CEO Michael Garrity. “Through this partnership, we’re providing ServiceTitan’s Canadian customers an integrated and efficient way to finance any project quickly and hassle free, beneficial to both homeowners and contractors.”

ServiceTitan is an all-in-one software solution for home services businesses such as residential HVAC, plumbing, and electrical. The company’s tools range from client scheduling and service dispatching to accounting, payroll, marketing, and more.

The Financeit integration, which taps Financeit’s payment plans, will help ServiceTitan’s contractor clients close larger deals more easily, as well as sell upgrades and higher-end products.

Financeit made its U.S. debut at FinovateFall 2013 in a joint demo with fellow Finovate alum FIS. In 2017, the company closed an investment round with Goldman Sachs that gave the financier a majority stake in the Toronto-based fintech.

Founded in 2011, Financeit has amassed more than 7,000 merchant partners and processed more than $3 billion (C$3.6 billion) in loan applications. The company has raised $38.4 million.

Goldman Sachs Predicts Disappointing iPhone Sales, Lower Stock Prices For Apple

Goldman Sachs is predicting that tech giant Apple will sell fewer than the 67 million units Wall Street expects it to, according to a report by CNBC.

Goldman Sachs Analyst Rod Hall rated the company as neutral, and advised his clients that Apple will probably not meet unit sales and average selling price estimates later in the year.

“We believe consensus is assuming a steep recovery in China, with little change in demand trajectory for other (geographies). We note that iPhone shipments in the U.S. and Japan cycled up in CY18, with U.S. shipments growing 8 percent year over year in CY18,” Hall told his clients in a note.

“A better consumer environment for the most part of 2018 combined with compelling products later in the year helped drive iPhone growth in these regions. For CY19, however, we note that U.S. consumer sentiment is down year over year and an end to subsidies in Japan could create volatility.”

In premarket trading on Wednesday (April 24), Apple shares inched up slightly higher. The equity is also up, at more than 27 percent over the last year, to $207.48 a share through Tuesday (April 23).

Goldman Sachs raised its price target on Apple to $182, which is still a 12 percent decline.

In an attempt to combat a slowing replacement cycle for its phones, Apple has been adding features like facial recognition and wireless charging, as well as bigger screens and more storage space.

The tactic hasn’t always been successful. In France, iPhone shipments have decreased 12 percent, the U.K. saw an 11 percent decrease and Spain saw a 3 percent decrease. China saw a 23 percent drop in in shipments year over year.

“It is too early to assume a recovery on units in China to pre-2018 levels given increasing local brand traction and ongoing consumer weakness that may suggest a ‘new normal’ level of demand for the country,” Hall wrote.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

McDonald’s Negotiates End Of Uber Eats Exclusivity Deal

McDonald’s is looking to make more money for its franchisees by renegotiating the terms of its exclusive delivery deal with Uber Eats, Bloomberg reported.

The two companies recently met to lower the fees paid to the delivery giant. The terms will include “significantly reduced commission rates for all U.S. restaurants,” with the eventual ending of the deal that currently only allows for Uber Eats deliveries, with no other companies involved. The move would allow for other companies like DoorDash or Grubhub to potentially deliver for the fast food company.

The news came in the form of a memo reviewed by Bloomberg, which arrives as Uber prepares its IPO, expected next month. Uber is touting its McDonald’s partnership as a prominent part of its business.

McDonald’s Chief Executive Officer Steve Easterbrook spent $300 million to update some of the restaurant’s key aspects, including adding self-order kiosks and redesigning digital menus. Shares of the 71-year-old company have almost doubled since Easterbrook took the helm.

The exclusivity deal with Uber started in 2017 in hopes of reigniting sales. The company declined to discuss the terms of the deal when Bloomberg asked, but said, “We’re committed to partnering with our franchisees to give them the support they need to continue to grow an experience and business priority that’s important to our customers and our brand.”

Every order with McDonald’s through Uber Eats has various costs. The fast food company charges $1.99 on top of a food order, with some fees and small order charges as well. The franchisees also pay a percentage to Uber, which has been a matter of contention for them. Franchisees own about 93 percent of all of the restaurant’s locations.

Food delivery is a growth spot for Uber, and one the company will promote during its road show with investors in the coming weeks. The company’s IPO filing has two pages devoted to its partnership with McDonald’s, and says Uber Eats makes up almost 10 percent of food sales at the fast food restaurant.

The memo also said that moving forward, Uber Eats will help with a “sizable contribution” to go toward national advertising for McDonald’s.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

Zelle transaction volume soars to $39B in first quarter

Early Warning Services LLC, the network operator of Zelle, said that $39 billion was sent over the P2P payment service during the first quarter on 147 million transactions, representing a 54% increase in transaction values at and 72% gain in transaction volume, compared with the year-ago period.

“This past quarter, Zelle achieves several milestones towards our goal of national ubiquity,” Lou Anne Alexander, group president, payment solutions at Early Warning Services, said in an announcement. “Our core processor partners have achieved tremendous results, signing more than 130 banks and credit unions in Q1.”

During the first-quarter of 2018, the company reported $25 billion moving through Zelle on 85 million in transactions.

Alexander said the company also launched a marketing campaign focusing on everyday case uses for Zelle.


Topics: Bill Payment, Mobile Apps, Mobile Banking, Money Transfer / P2P, Trends / Statistics


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Grab CTO To Step Down; Will Act As Adviser

Grab, the Southeast Asia ride-hailing startup, is losing its Chief Technology Officer Theo Vassilakis, who said in a LinkedIn post that due to personal circumstance, he has to leave the region and spend most of the time in the south of China.

In the post, the CTO said he will transition to an advisor role at Grab as of June 30. He will continue to lead the charge in technology and will assist Grab with its search for a new group CTO based in Southeast Asia.

“Serving as a tech partner to tenacious entrepreneurs like @Anthony Tan and @Hooi Ling Tan has been a humbling but rewarding crash course in guiding execution while instilling core values in a rapidly growing company,” the executive wrote. “Looking back, I’m amazed by how much we achieved by focusing on outserving our customers, all in a relatively short time. From the historical Uber deal, to welcoming 1000 more techies in 2018 alone, to scaling our FinTech, food and express offerings, to launching our superapp, to the Grab Platform, to Grab Ventures like personal mobility devices, to infrastructure that enables our people to go faster, to fundraising, to partnerships, to joint ventures, to government and university collaborations, to benefits improvements for our driver partners, to renewed safety initiatives in all our countries, to more income opportunities for our agents on the ground, to working capital for our merchants, to giving back campaigns, etc. etc. etc.”

Vassilakis’ announcement comes as Grab is gearing up to raise an additional $2 billion in funding this year to bankroll its expansion. In an interview with Reuters earlier in April, Grab CEO Anthony Tan said the company expects to raise $6.5 billion in venture funding this year. The company already raised more than $4.5 billion.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

Payment Network Zelle Processed $39B During Q1

Digital payment company Zelle sent $39 billion through its network on 147 million transactions during the first quarter of this year, the company said in a news release.

Early Warning Services LLC, which is the network operator behind the company, announced the Q1 news on Wednesday (April 24). Payment values went up 54 percent year over year, and payment volume increased 72 percent.

“This past quarter Zelle achieved several milestones toward our goal of nationwide ubiquity,” said Lou Anne Alexander, group president of payments solutions at Early Warning. “Our core processor partners have achieved tremendous results, signing more than a hundred and thirty banks and credit unions in Q1. In addition, our new marketing campaign was launched, tapping into everyday use cases of Zelle, designed to drive deeper knowledge and relevance with consumers.”

The Zelle network is used by upwards of 5,391 financial institutions, either through a mobile banking app or by registering a debit card with Zelle’s app.

Zelle has also been touting an ad campaign called “Everyday Better,” to highlight person-to-person (P2P) payments.

“Although digital P2P adoption first caught on with millennials, adoption of P2P services continues to rise among all generations. The Everyday Better campaign from Zelle highlights situations that appeal to a broad spectrum of people, tapping into moments everyone can relate to, such as graduation, rent, birthdays, brunch, and family reunions,” the company said. “The campaign continues to use bright colors, quirky humorous characters and fun memorable lines that demonstrate an alternative to using cash or checks.”

Zelle also had a fortuitous fourth quarter, along with Venmo. In Q4, Venmo posted an 80 percent spike in transaction volume, hitting $19 billion in the fourth quarter of 2018, according to PayPal’s most recent financial earnings release. When it came to total P2P volume, including transfers sent through the core PayPal service, the Q4 volume hit $39 billion.

That last figure was ahead of Zelle’s reported payment volume of $35 billion during the fourth quarter of 2018, but there’s a hitch to that — that $39 billion was for the entire PayPal network, not just Venmo for that quarter.

Meanwhile, for the full year 2018, Zelle had $119 billion worth of payments via 433 million transactions. The Zelle network includes “229 financial institutions [FIs] — 60 of which are live and processing transactions,” according to Early Warning Services. Those institutions serve some 100 million customers.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

What’s next for contactless technology?

Do you remember the first time you used contactless payment? The idea of simply tapping or waving your card over the terminal to complete your transaction was amazing, but now it’s very much a part of everyday life.

A leading light in our culture of convenience, contactless payment is set to become an even greater force in the next few years, but what exactly does the technology have in store for us?

Still work to do domestically

Despite its rampant success since its introduction to UK markets in 2007, contactless technology still has plenty of room to grow, particularly in the retail SME market. Three million small businesses in the UK still do not use contactless payment, with some business owners considering it more cost-effective to run a cash-only operation.

This is, in fact, an unwise strategy, with these businesses committing 81 minutes of labour a week to banking cash, not to mention alienating a significant portion of their customer base who are accustomed to a cashless existence. Businesses that do accept cards can expect to increase their revenue by 10%.

Regardless, with more than 3,000 businesses a day signing up to contactless payment and it overtaking chip and pin transactions last year, we can expect to see significant and continued growth across all markets.

Extra security for greater ceilings

One current drawback of contactless payment is its limited payment ceiling (currently £30 in the UK), but advancements in security could be set to change that figure. Amidst concerns around both more traditional and ‘drive by’ (where thieves use wireless technology to scan your card without your knowledge) thefts, digital security firms are developing ways to secure contactless payment.

One option is biometric security – cards with built-in fingerprint sensors – whilst decentralised blockchain technologies are creating reliable digital ID systems, which temporarily give a business access to an individual’s payment ID at the request of the customer.

Once better security systems are in place, contactless ceilings can rise, further enhancing the overall offering.

Breaking America

With the UK so familiar with contactless life, it might be hard to believe that contactless payment is somewhat of a rarity across the US. But not for much longer.

Once at the forefront of the EMV (Europay, Mastercard and Visa) movement, US issuers were initially hesitant to adopt contactless technology, favouring a push on traditional chip and pin instead. However, with contactless cards having taken off all around the world, the US is looking to catch up to their global counterparts swiftly as consumer demand increases.

How they go about their next phase of contactless development is somewhat up in the air, which brings us to our next point.

Plastic v mobile v wearables

Current technologies will be replaced by bigger and brighter offerings, but that doesn’t mean that the contactless card is dead in the water, at least for the foreseeable future.

The card is set to remain the weapon of choice for many, as it dominates consumer preference thanks its familiarity and reliability. It’s proposed the conventional card route will be the best method to indoctrinate the US market into contactless payments, as consumers trust their faithful plastic over the likes of mobile pay.

Of course, that doesn’t mean that mobile payments don’t have their own vertical trajectory to look forward to. Mobile devices provide a platform for providers to develop the next phase of contactless pay, due to the feasibility of including value-added services.

Finally, expect to see a big rise in the use of wearable devices over the next few years. Contactless technology is currently finding its way into watches, rings, keys, wristbands and even stickers to diversify consumer choice in how they make their purchases.

What’s for sure is, while the card will be sticking around a little longer yet, accessibility and use of mobile and wearable technologies will grow exponentially from here on out.

With new devices springing up all the time and methods of payment becoming easier than ever, consumers will need to be extra careful when it comes to managing their finances. However, the benefits of contactless payment are undeniable, and the revolution is only going to get bigger, faster and stronger.

Airbnb To Produce TV Shows Ahead Of Upcoming IPO

Home-sharing and hospitality online marketplace Airbnb will expand into show business with a variety of new original travel shows, Reuters reported.  

The plan is being heavily touted for the $31 billion company, which is preparing for an initial public offering (IPO), expected next year. Airbnb hopes the move will help distinguish it from other travel sites like Expedia and Booking.com, which offer similar services.

Chief Executive Brian Chesky is pushing the idea, the news outlet said, with the argument that creative endeavors are important for the brand. Chesky reportedly likes “big, splashy things,” according to one source.

“Brian wants to create a studio,” one of the sources said in the report. Chesky’s attitude is, “Let’s do shows. Let’s do films, because we want to be travel-everything.”

The idea has been tossed around for about three years, and includes producing or licensing a mini-series or documentary about travel featuring Airbnb guests and hosts. The company has also considered either starting its own studio or working with existing ones.

Airbnb has also worked on a TV show for Apple’s upcoming streaming service, called “Home.” The show features houses around the world and the people who live in them. One of the executive producers on the show is company VP Joe Poulin, who ran Luxury Retreats when it was acquired by Airbnb in 2017.

Last week, the company announced it had produced and developed a documentary called “Gay Chorus Deep South.” The show, which will premiere at the Tribeca Film Festival, shadows a San Francisco Gay Men’s Chorus as it tours the southeast. The company provided funding for the project.

Airbnb is reportedly considering streaming films and shows through its app, in addition to other video platforms.

Chris Lehane, Airbnb’s top policy and communications executive, said the company is looking at all of its options.

“We’re very much in the R&D phase here. It’s not just limited to video. It could be audible. It could be physical,” Lehane said. “The more we put content out there, the more you’re going to bring people to the platform.”

Lehane wants to attract customers before they go on vacation, and take away some of the unknowns about the company for travelers and Wall Street alike.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

Grab’s CTO To Step Down For Personal Reasons; Act As Adviser

Grab, the Southeast Asia ride-hailing startup is losing its Chief Technology Officer Theo Vassilakis, who said in a LinkedIn post that due to personal circumstance he has to leave the region and spend most of the time in the south of China.

In the post, the CTO said as a result of the personal circumstances he will be transitioning to an advisor role at Grab as of June 30. He said he will continue to lead the charge in tech and will assist Grab with its search for a new group CTO who is based in Southeast Asia.

“Serving as a tech partner to tenacious entrepreneurs like @Anthony Tan and @Hooi Ling Tan has been a humbling but rewarding crash course in guiding execution while instilling core values in a rapidly growing company,” the executive wrote. “Looking back, I’m amazed by how much we achieved by focusing on outserving our customers, all in a relatively short time. From the historical Uber deal, to welcoming 1000 more techies in 2018 alone, to scaling our fintech, food and express offerings, to launching our superapp, to the Grab Platform, to Grab Ventures like personal mobility devices, to infrastructure that enables our people to go faster, to fund-raising, to partnerships, to joint ventures, to government and university collaborations, to benefits improvements for our driver partners, to renewed safety initiatives in all our countries, to more income opportunities for our agents on the ground, to working capital for our merchants, to giving back campaigns, etc etc etc.”

The announcement on the part of Vassilakis comes as Grab is gearing up to raise an additional $2 billion in funding this year to bankroll its expansion. In an interview with Reuters earlier in April Grab CEO Anthony Tan said the company expects to raise $6.5 billion in venture funding this year. The company already raised more than $4.5 billion.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

Can Wall Street Bulls Put A Floor Under Lyft Shares?

Lyft shares have been on a skid, and one wonders if a surge of bullish notes and sentiments from Wall Street’s sell-side will be enough to steady the steering.

At this writing, shares are down 2.7 percent in intraday trading, and the stock still represents what is known as a “busted” IPO.  The recent price of $58 and change is a far cry from the $72 a share the company fetched earlier this year and an opening price that was north of $87. As in reported in MarketWatch, in recent days a slew of analysts have initiated coverage on the name with the impact that the majority of recommendations on Lyft are bullish ones.

That may not be enough to help matters, at least from our point of view.

In terms of keeping score, at the end of last month, six analysts were publishing on the name, and only one of them had what might be seen as a “buy” rating. Roughly one month later, there are almost two dozen analysts covering Lyft, and 13 rate it a buy, with another eight at hold or neutral ratings and one with a sell. In one note spotlighted in the report, Cowen and Co. Analyst John Blackledge initiated his coverage on Lyft with an “outperform” and $77 target, with mention of the Lyft “singular focus” on transportation that contrasts with Uber’s multi-faceted approach to verticals that also include food delivery. Lyft, said that analyst, will be able to offer better experiences for drivers, among other competitive advantages.

Separately, Jefferies Analyst Brent Thill, with an $86 price target, wrote, “We expect [the] stock to recover as Lyft executes and misconceptions clear. Although bears argue Lyft will never make money, our analysis shows improving margins and per ride metrics.” Revenues have outpaced bookings as measured in 2018.

But then again: The bullish sentiment seems not be a floatation device as the stock sank right in the wake of the news that new notes have been praising the growth and black ink that will be on the come — and of course the company still loses money. Wall Street is a voting machine sometimes, as the bullish notes show.

But at times, too, it is a weighing machine. The fact that investors — the ones that actually deploy money in order to own shares, and thus, a piece of the company — are not heeding the calls to line up and put money down means a lot.

It means investors are weighing what they get in return for ownership. Consider the fact that Levi Strauss, in its first earnings report since its IPO earlier this year, showed not just revenue growth but earnings on positive upswings too — even while it spends money to grow. That, likely more than bullish calls on the Street, has helped underpin its own shares. The company went public at $17; shares trade hands for about $22.30. Old school firms with profits seem to beat tech-sexy firms with the promise of profits — at least in this market, and at least for now.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

AT&T Loses Pay-TV Subscribers Amid Q1 Revenue Miss

Revenue for telecommunications giant AT&T missed Wall Street expectations on Wednesday (April 24), due to a loss in subscribers throughout all of its various businesses besides wireless, according to a report by Reuters.

Even with the wireless customer gain, the company paid significantly with price promotions. AT&T lost about 544,000 premium TV subscribers, which includes its DirecTV satellite and U-verse television businesses.

It’s been difficult for traditional TV companies to keep subscribers as customers migrate to streaming services like Netflix, and AT&T is no exception. The company recently launched its own streaming service, but that also lost customers in the quarter.

Smartphone promotions also hurt revenue, and the company has been trying to move away from its dependence on the sector, which brings in about 40 percent of its operating revenue. AT&T’s attempt to add media content illustrates this, as it recently acquired Time Warner for $85 billion.

“Altogether, AT&T’s collection of assets remains challenged,” Jonathan Chaplin, an analyst with New Street Research, said in a note.

The company saw reductions in its wireline segment in both the top and bottom lines. WarnerMedia trends “were just okay,” Chaplin wrote.

The WarnerMedia unit, which includes Turner and HBO, reported a revenue of $8.38 billion for the quarter, which fell short of the analyst-predicted $8.45 billion.

The phone segment of AT&T’s business was a bright spot, however, adding a net of 80,000 subscribers, which easily beat analysts’ prediction of a loss of 44,000. The company heavily pushed promotions to break through in a market with steep competition.

However, Mobility, which is AT&T’s largest segment, saw revenue of $17.57 billion, which was lower than the estimated $17.65 billion predicted by analysts.

Shares in the company were down 3.9 percent on the news, at $30.84. The rate of customer defections, called postpaid phone churn, was up 0.84 percent from 2018, at 0.93 percent.

Another segment that saw decline was DirecTV Now, which lost an estimated 83,000 customers.

“AT&T’s first-quarter earnings give a clear signal that the company is willing to compromise on growth in the short term as it struggles to cut its heavy load of debt,” said Haris Anwar, senior analyst at Investing.com. “And it’s a wise thing to do considering the market is very concerned about the company’s balance-sheet risk.”

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

SWIFT Selects Javier Pérez-Tasso As New CEO

The Society for Worldwide Interbank Financial Telecommunication (SWIFT), a payment messaging firm, has chosen Javier Pérez-Tasso as its new chief executive officer, according to a press release.

Pérez-Tasso has been part of SWIFT’s executive team for seven years, and he is currently the company’s chief executive of the Americas and U.K. region.

He will begin his new assignment on July 1, replacing Gottfried Leibbrandt, who announced last December that he would be stepping down effective at the end of June.

The firm conducted a comprehensive and diligent search for a new CEO, led by the board’s human resources committee and advised by an independent search firm.

“I am delighted to announce Javier’s appointment with the full endorsement of the board. SWIFT has an exceptionally strong management team, which has enabled the board to appoint an internal candidate and which will also allow for a smooth transition,” said SWIFT Chairman Yawar Shah.

“Javier’s track record of impressive leadership, coupled with his in-depth understanding of the company and its business, means that he is expertly positioned for this new role,” Shah continued. “I am confident that his appointment will ensure that SWIFT can continue to build on its tradition of excellence and innovation in support of the global financial community, while also enabling acceleration of its endorsed strategy.”

Pérez-Tasso joined SWIFT in 1995, and in 2015 was appointed as chief executive for the Americas and U.K. region. He was also an executive sponsor of SWIFT’s customer security program from 2016 to 2018, and helped lead SWIFT’s response to cyber challenges facing the payments industry. As chief executive, he worked with SWIFT’s engagement model to deepen its relationship with global transaction banks, and also delivered business development results in high growth markets, the company said.

Pérez-Tasso previously served as chief marketing officer for the organization. He also developed SWIFT’s current five-year plan, called SWIFT2020, which led to a renewed focus on cross-border and instant payments, crime compliance and deeper presence in the market infrastructure area.

Before he worked at SWIFT, Pérez-Tasso had a number of tech and leadership positions in business development in Europe, the Middle East and Africa.

“I thank the SWIFT board for its trust and feel privileged to lead SWIFT and serve its customers as CEO,” Pérez-Tasso said. “I am fortunate to start this mandate building on Gottfried’s strong legacy, and I look forward to maintaining our focus on operational excellence as well as accelerating SWIFT’s transformation during a period of unprecedented change and opportunity for the community.”

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report. 

Token Teams Up with Omnio Group to Boost Open Banking

Omnio Group is the latest fintech to partner with turnkey open banking platform provider, Token.io. The firm, whose digital banking platform, bank.VISION, powers banking and payments for more than 300 companies around the world, will leverage its new relationship with Token.io to provide open banking and PSD2 compliance to its FI partners.

“Token has enabled us to provide our clients with a PSD2 Open Banking Hub, which delivers secure connectivity between third parties and financial institutions,” Omnio Group Director of Implementation and Delivery, Rob Liddell explained. “Our next step is to work with Token to create innovative banking and payment experiences that meet the evolving needs of our digital customers.”

The first customer to take advantage of Omnio Group’s new partnership with Token.io is Irish postal, retail and financial service provider, An Post. The integration of both bank.Vision and TokenOS will give An Post access to crypto-based security, Token’s programmable money technology, as well as operational support, monitoring, and reporting.

“Our commercial strategy relies on our ability to successfully deliver in the digital world,” An Post Financial Services Director John Rice said. “Leveraging Token’s API puts us ahead of the game, enabling us to build a better proposition for our customers.”

Token.io demonstrated its PSD2-compliant open banking solution at FinovateEurope 2017. The company’s platform provides both banks and third parties with better compliance, quicker data aggregation, and direct bank payments with its single API and smart token technology.

Banks benefit from the ability to deliver more services to their customers and generate new revenue. By integrating TokenOS via simple, secure SDKs, banks can leverage crypto-based security and programmable money to build and develop new open banking apps. Payment service providers and merchants both win with better, more secure connections to banks, as well as faster access and lower costs.

Omnio Group is the latest company to sign on to Token.io’s open banking solution. Earlier this month, Token.io announced a partnership with Khaleeji Commercial Bank of Bahrain. Back in March, the company reported that it was working with U.K.-based challenger bank Tandem to ensure PSD2 compliance and support open banking. Late last year, Token and thinkmoney agreed to work together to expand open banking opportunities for the U.K.-based FI. More than 4,000 banks are currently connected via Token.io’s technology.

In addition to partnering with financial institutions around the world, Token.io also teamed up with open banking third party provider and identity and regulatory specialist Konsentus earlier this year. Together, the two will offer FIs in Europe a “fast and powerful combined solution for PSD2 compliance.” Token.io began 2019 by hiring a new Chief Technology Officer, Gaurav Kohli. Before joining Token, Kohli was VP of Product Development, Architecture, and Platform Engineering at Visa.

Mnuchin Prefers Private Over Government Solutions to Data Collection, Use

WASHINGTON, D.C. — U.S. Secretary of the Treasury Steven Mnuchin said today that he prefers private over government solutions when it comes to collecting and using consumer data for financial products and services, speaking at a fintech conference hosted here by the FDIC. Data aggregation — and getting consumers comfortable with allowing companies to access …Read More

Wirecard Expands Partnership With RBL Bank

Wirecard, the digital financial technology company announced on Wednesday (April 24) that it has expanded a partnership with RBL Bank to promote financial inclusion in India.

In a press release, Wirecard said the partnership will make digital payments and banking more accessible to all of the citizens in India, including people living in more remote areas of the country. As part of the partnership, Wirecard will empower its retail agents, who act as service representatives across India, to enable those underserved by the financial system to access basic payment and banking services such as cash withdrawals, deposits and balance inquiries.

According to Wirecard, there are close to 5,000 agents enrolled in the program. Consumers will only need their local Aadhaar identification number to access the services through Wirecard’s retail agents. The service is available to all citizens in India with the Aadhaar number linked to a bank account. Wirecard said about 90 percent of citizens have an Aadhaar number, while 80 percent of adults have bank accounts.

“Our extended partnership with RBL Bank will help bring even more essential transaction services to both urban and rural residents India-wide, regardless of their bank. As a leading digital financial services provider, we are excited to support this innovative solution,” said Managing Director India Anil Kapur in the press release. “Together with RBL Bank, we are addressing the needs of consumers who demand quick and secure financial services, no matter where they are located.”

The expanded deal with RBL Bank comes on the same day SoftBank announced it is investing EUR 900 million in Wirecard. Under the deal, Wirecard will issue convertible bonds to SoftBank with terms of five years. It is convertible for about 5.6 percent of Wirecard stock at EUR 130 per Wirecard share. Shareholders of Wirecard have to sign off on the deal at the company’s annual shareholders meeting on June 18.

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Latest Insights: 

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. Check out our April 2019 Unattended Retail Report.