A one-branch credit union with a global reach serves members through messages 

https://bankinnovation.net/allposts/biz-lines/retail/a-one-branch-credit-union-with-a-global-reach-serves-members-through-messages/

The Dow Chemical Employees’ Credit Union, which has 68,000 members around the globe and only one branch, is using in-app messaging to more efficiently reach members. 

DCECU’s online banking platform

“We can now reach out to [members] in a secure fashion without them having to contact us first,” COO Art Peters said. “We know when we get a message from a member coming in that it is truly a two-factor authenticated message. It’s very powerful for us because, while we still may ask some identifying questions as part of our normal authentication protocol, it goes very quickly.” 

The Midland, Mich.-based credit union launched the new chat feature in September with the help of core technology provider Jack Henry. DCECU employees can now send messages to members to notify them about security issues like suspicious account activity or locked cards. In the past, the credit union used phone calls, email or direct mail to reach members for these issues. 

Peters said the credit union is primarily using the new chat feature, available to members through the app and online banking, to reach them about security issues, not to cross-sell new products. Because the feature has only been live for half a year, Peters said the credit union is still deciding how to best use the chat functions.  

See also: How Academy Bank is using video to improve service efficiency

He said a chat function DCECU used in the past was inbound only, and is still available for members to use for customer service questions. The credit union has a contact center dedicated to reaching customers, and specialists are available for specific inquiries about their mortgages and credit cards. The credit union serves customers through the messaging function from 7 a.m. to 6 p.m. on weekdays, but is experimenting with after-hours services.  

According to Peters, there has been a decrease in customer service inquiries through its other customer service channels since rolling out the messages. The credit union will measure the success of the tool by how often members engage the institution through digital channels. 

DCECU, which has $1.7 billion in assets, is open to employees and retirees of the Dow Chemical Company, as well as their family members. An additional 70 employer group companies and a variety of local clubs and societies are also eligible to join the credit union. Dow Chemical has 36,500 employees and 109 manufacturing sites, and the company manufactures products in 31 countries. Peters said the credit union has members in 30 to 40 countries, and conducts 98% of its operations through digital channels.  

Bob Meara, senior analyst at Celent, previously told Bank Innovation that secure messaging is a good option for smaller financial institutions. “Text conversations are asynchronous,” he said. “A banker could be engaging more than one member at the same time.”  

Banking Automation Summit, which takes place from June 1-2 in Miami, is a unique opportunity to share insights, trends, strategies and best practices on back-office automation in financial services with the industry’s leading practitioners. Register here.

https://bankinnovation.net/allposts/biz-lines/retail/a-one-branch-credit-union-with-a-global-reach-serves-members-through-messages/

LendingClub to buy Radius for $185M in historic deal

https://www.mobilepaymentstoday.com/news/lendingclub-to-buy-radius-for-185m-in-historic-deal/

LendingClub Corp. agreed to buy Radius Bancorp, which includes its digital subsidiary Radius Bank, for $185 million in cash and stock, marking the first time a U.S. fintech has announced the acquisition of a bank. 

LendingClub, an online marketplace that provides $12.3 billion in loans, will combine with Boston-based Radius, which was founded in 1987 and has $1.4 billion in assets. 

“This is a transformational transaction that allows us to reimagine banking in a way that is free from legacy practices and systems, and where the success of LendingClub is aligned with the success of our customers,” Scott Sandborn, CEO of LendingClub, said in a company release. “By combining with Radius, we create a category-defining experience for our members that will dramatically enhance the resilience and earnings trajectory of our business.”

The LendingClub board of directors has created a Temporary Charter Bank Protection Agreement, also known as a stockholders rights agreement, to prevent the closing from being delayed and to comply with federal regulations. 

The agreement provides for the dilution of any person or entity that buys 25% or more equity in the LendingClub or 7.5% of LendingClub’s voting securities. The agreement will expire immediately after the deal is closed or after 18 months, whichever happens first. Officials said the deal is expected to close in 12 to 18 months. 


Topics: Mergers & Acquisitions, Mobile Banking, Regulatory Issues


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https://www.mobilepaymentstoday.com/news/lendingclub-to-buy-radius-for-185m-in-historic-deal/

From SuperApps and AI to Financial Inclusion 3.0

https://finovate.com/from-superapps-and-ai-to-financial-inclusion-3-0/

From the rise of the superapp to financial inclusion 3.0, the insights of our Fintech What’s Hot/What’s Not analysts at FinovateEurope last week continue to artfully disrupt our signature demo-only format.

Mixed in with live demonstrations of the latest innovations in payments and customer engagement (see our Best of Show coverage), our main stage analysts reminded us of the critical differences between machine learning and AI, the opportunities of 5G connectivity, and how open innovation helps companies maximize technological change.

Ratna Sita Handayani of Euromonitor International highlights the rapid growth of mobile payments in Asia.

Does the rise of the super app in Asia anticipate the future of apps in the West? Ratna Sita Handayani, Senior Research Manager with Euromonitor International, looked at the rapid growth in mobile payments in Asia, and the way that companies outside of traditional financial services such as ridesharing firm Grab have moved effectively into the payment space. Highlighting similar accomplishments from Japanese social media giant LINE and the continued rise of AliPay, Handayani considered how hyperlocalization and other strategies are helping these new offerings gain ground.

Promoting a “more autonomous, more distributed, and more ethical” fintech industry, Forrester VP and Research Director Oliwia Berdak encouraged innovators to move from thinking about the “next best product” to a value-for-value exchange in which interests align. Berdak compared many of the more limited fintech offerings of today with solutions such as smart contracts and even autonomous debt management that more fully take advantage of the latest technologies like advanced machine learning.

Berdak urges a move “from myopic and disoriented” to “more autonomous and more ethical” in fintech.

This is necessary in large part, Berdak suggested, to help manage the cognitive load of all the information that technology delivers in the first place. In other words, we need technology to “take the human” out of the technological equation we’ve created.

Tosin Agbabiaka, an Early Stage Investor with Octopus Ventures, leveraged his own experience – from frontier through the periphery to an increasingly divided developed world – to paint a vivid portrait of Financial Inclusion 3.0. Agbabiaka provided a deep, nuanced understanding of the challenges of developing countries like Nigeria in the 1990s where basic financial access was a principal obstacle to progress (Financial Inclusion 1.0). He then explained the difficulty periphery nations have when boom times stall and a lack of liquidity threatens to turn financial crises into catastrophe – like Greece in the late 2010s (Financial Inclusion 2.0).

A look at the challenges and opportunities on the periphery during Financial Inclusion 2.0

If the first stage of financial inclusion is about optimizing for basic access, and the second stage is about optimizing for quality and efficiency, as Agbabiaka indicated, the third stage of financial inclusion is about optimizing for affordability. This is the world we see in North America and Europe where the benefits of a digital, interconnected economy exist in abundance, but are harder for a growing number to obtain. These are places characterized by gig economics and alternative financing in response to low wages, funding challenges for micro- and small businesses, and the debt burden of higher education.

This is a critical challenge for fintech, Agbabiaka suggested, but it is not a challenge that needs to be pursued out of a sense of social good alone. Financial inclusion 3.0 represents the union of access, quality, affordability and, to coin a phrase used by another analyst above, aligns the interests of the frontier, the periphery, and the center when it comes to technological innovation. In this world, as Agbabiaka explained, “those served benefit as much as the newly-served.”

https://finovate.com/from-superapps-and-ai-to-financial-inclusion-3-0/

Breach Clarity’s New Offering Provides Consumers Personalized Protection

https://finovate.com/breach-claritys-new-offering-provides-consumers-personalized-protection/

Fraud detection and prevention company Breach Clarity announced this week it has developed a new platform to help financial service providers offer personalized protection for their customers.

The machine learning-powered platform, dubbed Breach Clarity Premium for Financial Services, offers two sets of tools, one for the financial services company and one for the end consumer.

“Financial institutions are in a bad spot when it comes to data breach fallout,” said Breach Clarity founder Jim Van Dyke. “These breaches, most of which they have zero control over, are coming fast and furious, yet the actual damage can take years to occur. We first developed Breach Clarity to help the consumer fight back against the routine theft of their personal information. Now, we’re equipping their financial providers with much greater intelligence to help them strengthen everyone’s financial health.”

Founded in 2019, Breach Clarity analyzes data breaches, scores them in real-time based on 1,000 factors, and offers ideas for protective measures. The database behind the consumer-facing tool includes more than 4,000 data breach incidents, a number that grows by 50 each week.

Breach Clarity Premium for Financial Services has multiple benefits for financial services and their customers. The new tool details the most effective actions both parties can take, based on the information that was compromised, to mitigate loss in the event of a breach. The offering also enables consumers to search for data breaches that impact them without leaving their bank’s website or mobile app.

Breach Clarity is headquartered in Walnut Creek, California. Van Dyke recently demoed Breach Clarity at FinovateFall 2019 in New York.

https://finovate.com/breach-claritys-new-offering-provides-consumers-personalized-protection/

FundingXchange embraces Open Banking through AccountScore’s market-leading solution

https://thefintechtimes.com/fundingxchange-embraces-open-banking-through-accountscores-market-leading-solution/

FundingXchange, a pioneering SME lending marketplace and intelligent decisioning platform, has partnered with the leading fintech platform AccountScore, to enable SMEs to reap the benefits of Open Banking and efficiently obtain a greater number of personalised funding quotes.

 

By matching businesses with lenders, FundingXchange provides SMEs with multiple quotes and helps identify the best funding solution for each business. By embracing Open Banking, FundingXchange enables SMEs to efficiently provide vital data to their preferred lenders without the need for physical paperwork. The in-depth information provided via AccountScore’s solution speeds up the customer journey, enriches the lender’s underwriting sources and thereby reduces loan processing time.

 Compared to traditional lending models, Open Banking enables more businesses to secure access to funding. Around 25% of SMEs are initially declined by their banks when applying for funding. AccountScore’s solution paints a holistic picture of a business’s financial situation by providing crucial insights, not available through traditional data sources, whilst making the process faster for both the consumer and the lender.

 

Katrin Herrling

Katrin Herrling, CEO at Funding Xchange said: “This is a huge step forward as we look to reduce friction and increase peace of mind for our customers, while improving risk selection and speed of decisioning for lenders.

 “Open Banking will be a key driver in enabling automated affordability models, giving lenders greater confidence in their digital credit assessments, and we’re delighted to be the first funding marketplace to integrate with AccountScore to help make this a reality.”

 

Emma Steeley

Emma Steeley, CEO, AccountScore, commented: “It is wonderful to see the growth of Open Banking in the SME arena, especially through the adoption of the technology by such a renowned platformas FundingXchange. From experience, we know that the data provided via our Open Banking solution has enabled more businesses to secure the funding they need. We look forward to working with FundingXchange to help enable more businesses to fulfil their potential.”

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https://thefintechtimes.com/fundingxchange-embraces-open-banking-through-accountscores-market-leading-solution/

How Far Can Venture Capital Take European Challenger Banks?

https://finovate.com/how-far-can-venture-capital-take-european-challenger-banks/

As 2020 begins, there may be no hotter fintech theme, both globally and in Europe, than the rise of the challenger bank. As we reported recently, the race for digital banking licenses in Singapore, for example, has resulted in an increasingly-crowded field of at least two applicants for each available license. In Europe, investment in challenger banks has made steady year-over-year gains since 2014, reflecting not only the strength in interest in the sector, but also the confidence that digital banks are likely to be a major component of the European financial landscape of the 21st century.

How has venture capital’s surging interest in challenger banks shaped the industry and does the flood of funding VCs are providing tell us anything about the future success of challenger banks in Europe?

From the €0.1 billion in VC investment in 2014 to the estimated €2.4 billion in VC investment in 2019, European challenger banks have been among the top recipients of regional venture capital in recent years – with sums comparable to that invested in payments companies. What is especially impressive about the growth in VC funding for challenger banks is the relatively smooth trend in positive funding growth over the year, with each year bringing in more investment dollars than the last.

In this way, investment dollars are following the customers. Research by AT Kearney indicates that European challenger banks have added more than 15 million customers since 2011, and that the industry will have as many as 85 million customers by 2023.

Quantifying the number of challenger banks in Europe overall is … challenging. In part, this is because there can be disagreement between which traditional banks with digital offerings can be considered truly challengers alongside fully, digital-only neobanks. Fintech Futures, Finovate’s sister publication, is developing its own database of challenger banks by nation; there are an estimated 80+ challenger banks in the U.K. alone.

These firms include a number of companies that have demonstrated their platforms on the Finovate stage – such as Revolut (U.K.), Klarna (Sweden), and Twisto (Czech Republic). And virtually every European country is represented by a significant (and often expanding) challenger bank – from N26 in Germany to bunq in the Netherlands, and from Bnext in Spain to Fire in Ireland. In addition to generous funding, these companies have been able to grow and scale thanks in large part to regulatory changes like PSD2 and the open banking movement that encourage data sharing and collaboration with incumbent financial institutions.

Challenger banks are also taking advantage of customer dissatisfaction with traditional banks; Koyo founder and CEO Thomas Olszewski noted that 2017 the biggest bank in the U.K. has an NPS (Net Promotional Score) of -24, with Germany’s biggest banks earning NPS scores of -8 and -22. NPS is a way to measure customer satisfaction via the likelihood of the customer recommending the company or service to another customer.

And, importantly, challenger banks are more likely to take advantage of the newest technologies for onboarding, and security, as well as provide the kind of digital customer experience (i.e., more mobile, more personalized; more social) that they have become accustomed to outside the world of finance.

Photo by Emre Can from Pexels

Marcin Mazurek, founder of Inteliace Research, observed earlier this year that the eight bigger European neobanks – Revolut, N26, TransferWise, Monzo, Starling, Curve, and Tandem – had almost 27 million customers by the end of last year. “In fact, their number of clients has increased exponentially as the figure doubled every year since 2016,” he wrote. Mazurek credits the wave of VC funding to allow the strongest players in neobanking to get even stronger, suggesting that “investors are competing for the ‘privilege’ to fund top startups and not the other way around.”

Mazurek also highlights a few warning signs for the sector, noting that VC investment driven valuations of challenger banks to potentially extreme levels. He does the math to reveal the fact that the seven biggest neobanks in Europe have implied valuation-to-funding multiples of 4.8x. This leads him to caution that there is a significant “disconnect” between challenger banks, their lofty valuations, and the relatively modest revenue per customer the major challenger banks are achieving (Mazurek estimates that challenger banks made between $3 and $38 in revenues per customer in 2018 and 2019).

The way out for these challengers, according to Mazurek, is continued growth of the customer base. Investors, he said, are counting on future, “multi-million customer bases” to help close the valuation/revenue gap for neobanks. Another option is that these institutions will be successful in upselling their customers from the free and low-cost services and products they currently enjoy to more premium offerings. This may be all the more vital as fintechs explore “banking-as-a-service” offerings that will allow them to encroach on some of the territory newly-disrupted by challenger banks.

Indeed, the view increasingly seems to be that venture capital has played a major role in putting challenger banks on the map. They have provided them with the capital they need to develop new products and scale their businesses (an especially worthwhile option in Europe where a banking license from one EU central bank can enable a challenger bank to operate through Europe).

But at this point challenger banks may have reached a crossroads. At this point, the wisdom and mentorship venture capital provides may prove more worthwhile than their euros in determining which firms will grow and thrive.

https://finovate.com/how-far-can-venture-capital-take-european-challenger-banks/

New SumUp Card Empowers SMEs as Business Payment Makers and Takers

https://finovate.com/new-sumup-card-empowers-smes-as-business-payment-makers-and-takers/

Photo by Artem Beliaikin from Pexels

The company that has helped bring fintech innovation to e-commerce with its mobile point-of-sale (mPOS), card reading solutions now offers merchants a card of their own.

SumUp announced this week the launch of the new SumUp Card. In partnership with Mastercard, the new card will make business payments easier for merchants, giving them both faster access to their funds, as well as enhance their ability to monitor their accounts.

When merchant cardholders accept payments via their SumUp readers, the payments will now flow directly to their SumUp Card. The card guarantees next-day payouts including on weekends, has no upfront cost or monthly fee, and offers free overseas payments. Available initially in the U.K., Italy, Germany, and France, the SumUp Card will be expanded to other markets over the course of the year.

The card comes in the wake of consultations with the company’s SME partners, as well as a successful beta-test with more than 25,000 merchants. The partnership with Mastercard reprises a collaboration the two firms undertook last summer which was designed to boost the number of electronic payment acceptance locations in 27 markets in Europe. The company noted in its statement that the card makes SumUp a more comprehensive solution for SMEs by facilitating “both the making and taking of payments.”

“Since launching our first reader, we have been dedicated to empowering merchants so they can focus on making their business as successful as possible,” SumUp co-founder Marc-Alexander Christ said. “We had this in mind when we designed our latest product, with the SumUp Card being a smart solution so we can continue being the driving force behind small businesses across the globe.” He referred to the new offering as “a small card for big ideas.”

SumUp was founded in 2001. The small business payments facilitator offers a variety of solutions that provide merchants with inexpensive payment acceptance options wherever their business is. The U.K.-based company has raised more than $425 million in total funding, most recently securing €330 million ($356 million) in debt financing. An alumni of FinovateEurope 2013, SumUp forged a partnership with German challenger bank Penta in December, and collaborated with U.K. challenger bank Starling Bank in July.


Read more about challenger banks in Europe in our recent features on top challenger banks in Germany and how venture capital is impacting the growth of the industry across the continent.

https://finovate.com/new-sumup-card-empowers-smes-as-business-payment-makers-and-takers/

HSBC to shed 35,000 jobs globally in major restructuring

https://www.mobilepaymentstoday.com/articles/hsbc-to-shed-35000-jobs-globally-in-major-restructuring/

London-based HSBC will shed 35,000 jobs worldwide as part of a restructuring effort that will reduce its U.S. branch presence by about 30% and focus more resources into its Asia and Middle East operations. HSBC officials said during an investor presentation Tuesday morning that they would reposition the U.S. business into an internationally client-focused corporate bank, with a targeted retail opening.

The company will reduce operating expenses by 10% to 15% in the region, while refocusing retail operations towards globally mobile customers, and invest in digital and unsecured lending. 

“We are taking decisive action today to address those underperforming parts of the business, to redistribute capital to the growth opportunity, to simplify our business and in doing so reduce the cost base of HSBC,” Group CEO Noel Quinn, said in a video statement posted Tuesday on the bank’s website. “But it’s for a purpose, and that purpose is to grow.”

Quinn said the bank delivers about an 8% return, but the plan is to increase that return to between 10% and 12% by 2022. 

In the U.K., HSBC will focus on supporting mid-market and international corporate clients through its London hub, and plans include reducing its sales and trading and equity research business in Europe as well as transferring its structured products business from the UK to Asia. 

Also, it’s restructuring the overall reporting organization of the bank, including consolidating the back and middle office into a single model for CMB and global banking. 

Geographic reports will be reduced from seven to four, and global functions and the head office will also be restructured to reflect the changes in the larger organization, according to the announcements. 

The bank is expecting to incur about $6 billion in restructuring costs and disposal costs of about $1.2 billion, with most of the expenses taking place in 2020 and 2021. 

Cover image: iStock
 

https://www.mobilepaymentstoday.com/articles/hsbc-to-shed-35000-jobs-globally-in-major-restructuring/

Mohegan Sun launches mobile-food ordering with Noble

https://www.mobilepaymentstoday.com/news/mohegan-sun-launches-mobile-food-ordering-with-noble/

Mohegan Sun, a major casino and entertainment resort in Connecticut, has entered a deal with Noble to provide mobile food and drink ordering at the property.

Noble’s technology allows guests to order cocktails or food using native mobile apps, web links/QR codes or via text on a chatbot. Guests can pay and leave tips with a traditional credit card, Apple Pay or Venmo payment. 

“With guests attending well over 100 concerts and sporting events in Mohegan Sun Arena every year — many of which are sold out performances — we needed a system that could handle the volume of food and drink ordering that we encounter frequently,” Jeff Hamilton, president and general manager at Mohegan Sun, said in a release. “We looked to build our own platform, but the appeal of the Noble network of users and trusted brand made partnering with the company an easy decision.”


Topics: Mobile Payments, Restaurants

Companies: Venmo, Apple, Noble


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https://www.mobilepaymentstoday.com/news/mohegan-sun-launches-mobile-food-ordering-with-noble/

HSBC reboot fizzles, sending stockholders looking for the exits

https://bankinnovation.net/allposts/biz-lines/corp-bank/hsbc-reboot-fizzles-sending-stockholders-looking-for-the-exits/

HSBC Holdings Plc Chairman Mark Tucker promised a strategy reboot. Investors got what some called more of the same — pledges to cut costs and do more with less.

The shares plunged by the most since 2017 after buybacks were shelved for two years and the executives themselves said more bad news was still to come — once they assess the economic damage wrought by the novel coronavirus.

In the overhaul announced on Tuesday, HSBC will slash about 35,000 staff — 15% of the total — and take $7.3 billion of charges, while it doubles down on Asia, source of most of the bank’s profit, and cuts operations in the U.S. and Europe. Left hanging was interim Chief Executive Officer Noel Quinn as Tucker and the board consider a permanent appointment.

“I wish we hadn’t had HSBC shares this morning,” said Alan Beaney, CEO at RC Brown Investment Management. “I am not quite sure why Quinn has not been named CEO now given they have allowed him to cut 35,000 jobs and make a number of strategic decisions. It does not make sense to me.”

HSBC Chief Financial Officer Ewen Stevenson said the bank would be “ruthless” in executing its plan — the giant’s third strategic overhaul in a decade — but he has an uphill struggle persuading shareholders. “The board are asking the market to take an enormous amount on trust,” said analysts at Keefe, Bruyette & Woods, the specialist financial-services broker.

London-traded shares in HSBC, Europe’s biggest bank by market value, tumbled as much as 7% to 549.50 pence, wiping out its gain so far in 2020.

While Tucker is returning the bank — founded in 1865 as the Hongkong and Shanghai Banking Corp. — to its roots with the sharpened focus on Asia, analysts noted the shortage of detail on how it plans to grow there.

For bank strategists, there might be a case of déjà vu: a 2018 plan by Quinn’s predecessor, John Flint, fell flat on arrival. Flint was fired 13 months later. Tucker, who was hired in 2017 to revive growth at the sprawling lender, is still struggling to answer investors’ question of why a bank with such a strong hold in some of the world’s fastest-growing economies has been unable to produce a better return.

Cutbacks
The latest plan envisages cuts to underperforming businesses and regions, in particular HSBC’s global banking and markets unit, which houses its investment bank. The bank has said it will reallocate $100 billion of risk-weighted assets to areas where it can make more money. The job cuts will put total staff at about 200,000.

“Parts of our business are not delivering acceptable returns,” Quinn said.

By 2022, HSBC will increase risk-weighted assets devoted to Asia to 50% from about 42%.

The fresh strategy makes sense, but is “on the conservative side,” Alan Higgins, chief investment officer of Coutts & Co., said on Bloomberg television.

The main points of today’s earnings report include:

  • HSBC’s adjusted pretax profit of $22.2 billion beat estimates, despite the multi-billion dollar charge for the restructuring. HSBC had been forecast to report adjusted pretax profit of $21.8 billion, according to analysts.
  • The bank plans gross asset reduction of more than $100 billion by the end of 2022, and a lowered cost base of $31 billion or less by 2022
  • Consumer banking and private banking will be merged into a single wealth platform
  • Global banking and commercial banking middle and back offices to be combined
  • Geographic reporting lines will fall from seven to four

“We are intending to exit a lot of domestically focused customers in Europe and the U.S. on the global banking side,” Stevenson said in a Bloomberg Television interview.

Execution aside, the unknown remains the impact of the coronavirus. Stevenson estimated possible losses in the first-quarter of 2020 at between $200 million and $500 million. Executives said on a conference call that the loan book has shown “great resilience” so far in the face of the outbreak.

“While reduced capital allocation to low-return businesses is a positive, we expect weaker profitability in what have traditionally been strong markets, primarily Hong Kong,” Morgan Stanley analysts wrote, maintaining their underweight rating on HSBC.

— Harry Wilson and Stefania Spezzati (Bloomberg) 

https://bankinnovation.net/allposts/biz-lines/corp-bank/hsbc-reboot-fizzles-sending-stockholders-looking-for-the-exits/

Cardtronics enables cash balance reloads for Amazon customers

https://www.mobilepaymentstoday.com/news/cardtronics-enables-cash-balance-reloads-for-amazon-customers-2/

Cardtronics, the largest ATM operator in the world, announced that Amazon customers can load cash onto their Amazon cash balances at up to 400 of its ATM sites in the U.S. by using a mobile number. They can add $5 to $500 to their balances by verifying the mobile number linked to their Amazon accounts and deposit the cash electronically by entering their mobile numbers at one of 400 Allpoint+ ATMs. 

An Amazon gift card is digitally added to the customer’s Amazon balance and can be used for purchase. No physical card is required to complete the transaction. 

“Cardtronics Allpoint+ with Amazon Cash is providing more access and more choice for millions of cash-centric customers by leveraging the power of our extensive network of convenient ATM locations,” Brad Nolan, executive vice president, Allpoint Solutions at Cardtronics, said in a company release. “Freeing the ATM from the constraints of traditional credit cards allows us to offer secure and convenient services to a virtually unlimited variety of digital accounts, well outside traditional checking and savings programs.”

The Allpoint+ network operates in major retail establishments in major U.S. markets, including New York, Chicago, Dallas, Houston and Miami. Additional ATM locations are planned for other cities. 


 


Topics: ATM Innovation, ATM & Mobile Banking, Debit / Credit, Payments

Companies: Cardtronics, Amazon


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Visa, Accor enter co-branded card partnership

https://www.mobilepaymentstoday.com/news/visa-accor-enter-co-branded-card-partnership/

Visa Inc. and Accor, a French multinational hospitality company, have partnered to launch a co-branded card for the hotel company’s All Accor Live Limitless loyalty program members. The ALL Visa card offers loyalty points and member perks in key markets around the world, allowing guests to accumulate points on purchases and stays at Accor properties. 

“We are delighted to partner with Accor and support the introduction of a new customer loyalty program,” Al Kelly, chairman and CEO of Visa, said in a joint release. “Today’s digitally savvy customers expect rewards that are tailored to their needs and offer new and unique experiences,” 

Accor operates 5,000 hotel properties under a total of 39 brands, including the Raffles, Fairmont, Sofitel, Banyan Tree, Mondrian and Delano names. The company has 64 million loyalty members and 250 million customers globally. 

“Partnering with Visa will be a huge boost to Accor as we embark on the shared journey to develop an innovative co-branded payment card,” Sebastien Bazin, chairman and CEO at Accor, said in the release. “This new initiative will provide unmatched benefits to our members and reinforce the success of our ALL loyalty program by increasing our member base, driving additional engagement and giving each member incentives to stay with us more frequently and easily.”


Topics: Card Brands, Loyalty Programs, Mobile Marketing, Region: EMEA

Companies: Visa


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https://www.mobilepaymentstoday.com/news/visa-accor-enter-co-branded-card-partnership/

Fiserv testing PIN on mobile payment technology with Visa, Samsung

https://www.mobilepaymentstoday.com/news/fiserv-testing-pin-on-mobile-payment-technology-with-visa-samsung/

Fiserv testing PIN on mobile payment technology with Visa, Samsung

Fiserv Inc. said it is testing ground-breaking PIN on mobile technology with Samsung Electronics Co., Visa Inc. and PayCore Inc., which allows merchants to accept payments on a consumer-grade mobile device.

The payment technology, developed through Fiserv’s First Data business, along with the other three companies, allows merchants to take payment on a regular smartphone or tablet without needing a separate card reader or PIN entry device. Such a capability would allow merchants of various sizes, including single-person micro-businesses, to accept non-cash payments, John Gibbons, executive vice president and head of EMEA at Fiserv, said in a company press release. The new capability reflects changes in how consumers want to pay, however, not all merchants are capable of accepting those types of payments. 

“Contactless chip and PIN payments are common, yet over 23 million micro-merchants in Europe alone may lack terminals to accept them,” he said. “We’re making sure no merchant is left out and helping them do business in the cashless economy by turning the smartphone into a card acceptance device.”

Fiserv is testing the solution during a pilot in Poland and plans to roll out the PIN on mobile technology in the EMEA and Asia-Pacific regions. 

Cover image: Fiserv

 

 


 


Topics: Card Brands, EMV, Handsets / Devices, Mobile Apps, Mobile Payments, POS, Region: EMEA, Retail, Security, Transaction Processing

Companies: Samsung, fiserv, Visa


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https://www.mobilepaymentstoday.com/news/fiserv-testing-pin-on-mobile-payment-technology-with-visa-samsung/

SumUp and Mastercard partner to launch card for business payments  

https://thefintechtimes.com/sumup-and-mastercard-partner-to-launch-card-for-business-payments/

SumUp surpasses two million merchants – becoming the first ‘one stop shop’ for UK small business owners

SumUp  the UK-based financial technology company, has today announced the launch of its first-ever card for business payments, in partnership with Mastercard. The card will allow merchants easier and quicker access to their funds, give them the ability to closely monitor their finances, and help them make essential business payments in a quick-and-easy manner.

With the launch of the ‘SumUp Card’, SumUp is able to facilitate both the making and taking of payments, becoming the first complete toolkit for UK small business owners.

This new addition to the product suite will allow payments taken by merchants via SumUp readers to flow directly to their SumUp Card. The card also guarantees next-day payouts, even on weekends, providing smaller merchants with vital access to funds when convenient – with all purchases and balance being monitored through the SumUp App.

The card is available to SumUp merchants with no upfront cost or monthly fee, as well as free overseas payments. Online, contactless, and Chip-and-PIN payments are fully available.

SumUp’s latest figures show that 2 million merchants currently rely on SumUp’s technology worldwide (with an extra 5,000 joining every day), from beauty salons, to taxi drivers, to parish priests. The card will be available in the UK, Italy and France as of today, with plans to extend the service to further territories in the next 12 months.

The new card has been built to streamline the process from point-of-sale, to payment, to accessible funds – following direct consultation with their network of small businesses and successful beta-testing with a sample of over 25,000 merchants.

Ian Young, Taxi Driver and SumUp Card user, comments: “This card provides all the benefits a small business like myself is looking for. When taking payment for trips around Cheshire, it’s incredibly helpful to switch between my bank account and the SumUp Card to ensure that I always have access to the funds I need the very next day. I’d be lost without it now.”

Marc-Alexander Christ

Marc-Alexander Christ, Co-Founder of SumUp, comments: “This is a small card, for big ideas. Since launching our first reader, we have been dedicated to empowering merchants so they can focus on making their business as successful as possible. We had this in mind when we designed our latest product, with the SumUp Card being a smart solution so we can continue being the driving force behind small businesses across the globe.”

Jason Lane

 Jason Lane, Executive Vice President Market Development Europe at Mastercard, comments: “We are delighted to be building on our partnership with SumUp with the launch of a business card. This extended partnership brings more innovation to micro, small and medium-sized businesses offering a convenient way for them to pay and be paid using the simple, speedy and secure payment experience they’ve come to expect from Mastercard anywhere in the world.”

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https://thefintechtimes.com/sumup-and-mastercard-partner-to-launch-card-for-business-payments/

MYPINPAD Launches Global ‘I Love SPoC’ Campaign with Exclusive London Event

https://thefintechtimes.com/mypinpad-launches-global-i-love-spoc-campaign-with-exclusive-london-event/

Authentication experts hosted industry briefing on Software-Based Pin Entry On Cots (SPoC) Solutions

 

The global leader in secure customer authentication solutions, MYPINPAD, last week firmly took the reins in educating the wider fintech market about a new global opportunity in mobile payments. The business kicked off its industrywide ‘I Love SPoC’ campaign at a private event on Thursday 13th February at Level 40 of the iconic Gherkin in London.

 Launched the day before St Valentine’s Day, the aptly named ‘I Love SPoC’ initiative has been designed to inform the payments industry, and other related sectors, of the benefits SPoC can offer. Put simply, how everyday smartphone and tablet devices are now able to take card payments simply and securely, and single-purpose POS devices could be a thing of the past.

 Having been amongst the world’s first to achieve certification for its innovative SPoC-approved technology for iOS, MPP mPOS, MYPINPAD was perfectly placed to host this industry event.  Its PIN on Mobile solution is a major enabler for the predicted expansion into the number of payment acceptance devices globally.

 The unique event brought together industry leaders to discuss how the PCI Security Council’s SPoC certification and just published CPoC (tap on phone payment) will benefit acquirers, PSPs and merchants of all shapes and sizes globally. This was highlighted through a series of presentations from industry specialists on the many benefits of PIN on Mobile and tap on phone, followed by hands-on demonstrations of MPP mPOS and MPP SoftPOS. The demos were brilliantly received by attendees and left a great impression that showed the valuable application of the capabilities of this technology for all merchant sectors: micro-merchant to tier 1 retailers.

 

Nigel Dean

Nigel Dean, Head of Marketing at MYPINPAD, says: “One of the founding principles of MYPINPAD is to promote authentication on everyday smartphones and tablets. Seen by many in the industry as the founder of PIN on Mobile we predict out technology to be deployed across the globe in the coming year. We’re proud to not only be playing a major role in showcasing the benefits that SPoC and CPoC offer, but also to be highlighting our own technology with those that the solution will benefit the most.”

 

“The Gherkin was the perfect location to hold this important event” continues Nigel.This iconic piece of British architecture overlooks the epicentre of the UK’s payment industry in London. It perfectly reflects how SPoC and CPoC will overlook and revolutionise every aspect of payments going forward to help the industry to embrace a new age of security.”

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https://thefintechtimes.com/mypinpad-launches-global-i-love-spoc-campaign-with-exclusive-london-event/

RBC fuses payments and messaging for business clients 

https://bankinnovation.net/allposts/biz-lines/payments/rbc-fuses-payments-and-messaging-for-business-clients/

Royal Bank of Canada is using digital money transfer service Interac to help corporate clients follow up with their customers on outstanding debts. The bank announced the feature, “Interac e-Transfer: Bulk Request Money,” last week to help clients collect payments faster. Through Interac, a bank-operated digital payments service used by Canadian consumers, RBC business clients …Read More

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https://bankinnovation.net/allposts/biz-lines/payments/rbc-fuses-payments-and-messaging-for-business-clients/

`NonTransparent ETFs` one step forward and two steps backward

https://dailyfintech.com/2020/02/18/nontransparent-etfs-one-step-forward-and-two-steps-backward/

pros cons

The `NonTransparent ETF` wrapper caught my attention recently, while reviewing WealthManagement news and trends. What kind of innovative investment vehicle would choose in our times, this kind of name?

In late January this year, the SEC approved a new ETF wrapper and several companies will be able to launch active ETFs or license the wrapper to asset managers. T. Rowe had first applied for SEC approval to launch actively managed ETFs (what is now called `NonTransparent ETFs`) as early as 2013.

Undoubtedly, the growth of low cost, indexing, passive ETFs has been supported by digital innovations in wealth management. However, it is the incumbents that own the lion`s share of the low cost, passive ETF market. Similarly, it is predominantly incumbents that will be launching NonTransparent ETFs.

Efi Pylarinou is the founder of Efi Pylarinou Advisory and a Fintech/Blockchain influencer – No.3 influencer in the finance sector by Refinitiv Global Social Media 2019. 

You get 3 free articles on Daily Fintech. Get all our fresh content and our archives and participate in our forum, by becoming a member for just US$143 a year.

NonTransparent ETFs are actively managed ETFs that offer all the advantages of the ETF wrapper – digital access, intraday liquidity, tax efficiencies, ect – for actively managed portfolios. The reason that they have been called `NonTransparent ETF` is that the managers are not disclosing their holdings on a daily basis but on a quarterly basis. The ETF manager will only disclose real-time his-her positions to the Authorised Participant that is the entity who provides the in-kind redemption process.

Eaton Vance has been the only company that already has an approved wrapper, the NextShares, which is an actively managed open-end fund trading on exchanges without regularly disclosing its holdings. ETMFs were launched in 2016 but the growth has been negligible.

Eaton Vance Stock NextShares (EVSTC) – $6mill AUM

Eaton Vance TABS 5-to-15 Year Laddered Municipal Bond NextShares (EVLMC) – $7mil AUM

Precidian received approval in Spring 2019, for their own proprietary NonTransparent ETF structure, the `ActiveShares` which can also be licensed.

In this recent approval, Blue Tractor a 5 year old company also received approval to license its proprietary model, Shielded Alpha, to asset managers who are interested to launch NonTransparent ETFs.

Actively managed ETFs

Actively managed ETFs already exist but they are no more than 2% of the entire ETF sector. They have predominantly been focused on fixed income which is an asset class that the portfolio holdings are not easily replicable. Most asset managers have had difficulties beating their benchmarks and at the same time offering low cost investment vehicles (even in funds) which has resulted in very low interest in equity actively managed ETFs.

As most opportunities in equities have been in smaller caps rather than larger caps and in international markets rather than US domestic markets, actively managed ETFs in larger-cap domestic caps seem challenging.

The NonTransparent ETFs that have been approved maybe (just maybe) will establish themselves especially as investment ingredients that financial advisors embrace. The question is whether financial advisors will stomach the opaqueness of these ETFs. I guess they would if the alpha produced is sufficient but that of course, is a chicken and egg problem.

The only example of fully Transparent Actively managed equity ETFs is the family of ETFs launched by ARKInvest, which I have covered from their early days.

The investment thesis of ARKInvest is Innovation. It offers five actively managed thematic ETFs whose holdings are fully transparent (with a small intraday reporting delay). ARKK is the largest ETF with $1.86billion AUM (Total assets under management for all five ETFs are just over $3billion)

Screen Shot 2020-02-17 at 10.51.14

ARK was awarded by Fund Intelligence in 2019, the ETF Suite of the Year. Cathy Wood, the CEO, has also been disruptive in the way research is conducted at ARKInvest. They have developed an Open Research process that allows them to go beyond the traditional financial analysis by including Theme Developers and experts and holding open debates around their investment themes. More here.

Two picks of noteworthy innovations of ARKInvest ETFs.

  • In the Fall of 2015 ARKW ETF, was the first ETF that invested in Bitcoin through Grayscale’s Bitcoin Investment Trust. I personally remember reading Chris Burniske`s (research lead at the time at ARKInvest) ARKInvest research at the time which was shared openly and led to their investment decision. The ARK Web x.0 ETF (ARKW) listed on NYSE Arca invests in  innovative internet technologies including cloud computing, big data, digital media, e-commerce, bitcoin and blockchain technologies, and IoT.
  • Currenrly, ARKInvest shares openly on their website and on the Github their valuation model of Tesla which is a core holding in three of their five ETFs. Tesla’s Potential Trajectory During the Next Five Years is their latest thinking around Tesla`s potential and the actual model with its inputs is on the github here.

https://dailyfintech.com/2020/02/18/nontransparent-etfs-one-step-forward-and-two-steps-backward/

TipYo pitches digital tipping for hotel staff

https://bankinnovation.net/allposts/biz-lines/payments/tipyo-pitches-digital-tipping-for-hotel-staff/

There may no longer be an excuse for stiffing hotel staff who ferry bags to guest rooms.

TipYo, an Alexandria, Va.-based payments startup, wants to simplify the tipping process through a method that’s as simple as using Venmo to pay a friend. Customers download an app to pay staff members, including housekeepers, bellhops, valets and concierges.

TipYo founder Brian Walsh said he set up the company 18 months after he noticed that methods of tipping hotel staff hadn’t evolved in generations. 

“I was traveling quite a bit and became increasingly frustrated by people not having cash to tip hospitality workers,” Walsh said. “That’s really where it started.”

The company is entirely self-funded, and TipYo is currently live at two locations that are part of the Provenance Hotels chain: Hotel Murano in Tacoma, Wash., and Hotel deLuxe in Portland, Ore. Walsh said the remaining 12 hotels in the network will offer TipYo later this year.

For now, TipYo is available through a stand-alone app, but Walsh said the technology can be embedded within hotel apps. While it may be as easy as using Venmo to tip a staff member, unlike that popular peer-to-peer payments service, TipYo has designed the tool to make transactions — as well as the names of recipient employees — private.

Retail rewards as in-app cash: Venmo embeds with loyalty programs

“We’ve gone to great lengths to keep it anonymous,” Walsh said. “We are not Venmo and by design don’t want to be, because of privacy issues and how the money flow has to work.”

He explained that when a customer sends a tip through the TipYo app, it automatically connects to the hotel back-end software, which tags the correct employee with the room number and the guest in question. The tips then show up on employee paychecks because the platform is synced with payroll.

TipYo monetizes the product through subscription fees hotels pay to offer it to customers; he didn’t say how much. Since the service rolled out at Hotel Murano in November, around 100 guests have tipped using the platform. Walsh is betting that ease of use will result in higher-value tips; he said the average tip size of customers using the platform is $6, and some customers are using it multiple times per day.

While TipYo may represent a new phase of consumer payment behavior, like other digital payment methods, it’s safe to say adoption may take time. While Walsh acknowledges that having TipYo in most U.S. hotels is “pie in the sky,” he said there’s a huge addressable market, which extends not only to hotels, but other areas, such as country clubs and valet services.

“We certainly see other opportunities, and the primary hospitality space other than hotel that we expect to have an impact on is in the valet parking space,” noted Walsh. “We’re really coming into play where there’s not a point-of-sale opportunity, and that’s pretty considerable.”

 Bank Innovation Ignite, which will take place on March 2-3 in Seattle, is a must-attend industry event for professionals overseeing financial technologies, product experiences and services. This is an exclusive, invitation-only event for executives eager to learn about the latest innovations. Request your invitation.

https://bankinnovation.net/allposts/biz-lines/payments/tipyo-pitches-digital-tipping-for-hotel-staff/

WorldRemit links with Alipay on one-tap global payments to China

https://bankinnovation.net/allposts/biz-lines/payments/worldremit-links-with-alipay-on-one-tap-global-payments-to-china/

WorldRemit is partnering with Alipay to reduce friction in cross-border payment transactionsThe integration allows WorldRemit  customers to send money to Chinese recipients by connecting with their Alipay accounts. The service has been available since January.

Since Alipay is one of the most commonly used mobile wallets in China, integration with WorldRemit is meant to facilitate money movements while Chinese citizens and residents make payment transactions at home or abroad.

Alix Murphy, vice president of global expansion at WorldRemit, said the initiative is a way for the company to tap into a growing market for remittances from a country that has a large population and strong international links.  

“There is a lot of the Chinese diaspora abroad, and for individuals who want to send money back to China, current channels are challenging,” Murphy said. “We see ourselves in this partnership opening up a specific new way of getting money back home quickly.”  

The WorldRemit and Alipay partnership builds on a new use case for mobile payment wallets typically used to pay for goods online or at physical checkoutsSince 2014, the WorldRemit platform has been integrated with mobile wallet M-Pesa, which operates in several African countriesMurphy said the company is open to further mobile wallet integrationsboth in China and farther afield. 

See also: WorldRemit opens Toronto office to help grow Canadian customer base

Meanwhile, Alipay is seeing greater adoption outside China as international retailers add it as a payment option. In recent years, for example, U.S.based merchants, including Guess, Rebecca Minkoff and Fendi, have onboarded Alipay in hopes of attracting business from Chinese tourists and migrants. 

WorldRemit joins a group of startups, including TransferWise and Remitly, that are simplifying the cross-border payments process and eliminating the need for physical pickup and dropoff points. 

“We see there being a high demand for a swift way of sending money, but also really enabling that journey through the mobile phone,” WorldRemit’s Murphy said. “Why not use what people have already?”  

As remittance startups like WorldRemit compete against incumbent moneytransfer providers with lower fees and digital interfaces, carving out a unique offering will be an ongoing challenge. 

As the [digital money-transfer] industry moves toward one with the characteristics of a commodity market, players are having to find new ways to differentiate themselves, wrote fintech consultant Mauro Romaldini.  

Bank Innovation Ignite, which will take place March 2-3 in Seattle, is a must-attend industry event for professionals overseeing financial technologies, product experiences and services. This is an exclusive, invitation-only event for executives eager to learn about the latest innovations. Request your invitation. 

https://bankinnovation.net/allposts/biz-lines/payments/worldremit-links-with-alipay-on-one-tap-global-payments-to-china/