The post Decentralized Finance market to reach $497.9 billion by 2032 appeared first on Payments Cards & Mobile.
]]>COVID-19 accelerated the growth of the decentralized finance (DeFi) market as people sought alternative financial solutions during economic uncertainty.
DeFi platforms offered opportunities for higher yields, decentralized access, and reduced reliance on traditional financial institutions.
This increased interest and investment in DeFi projects, expanding the market significantly. However, it also exposed vulnerabilities in smart contracts and security, highlighting the need for further development and regulation in the industry.
The decentralized finance market outlook can be segmented on the basis of component, application, and region. Based on component, the market is segmented into blockchain technology, decentralized applications (dApps), and smart contracts.
On the basis of application, it is segmented into decentralized exchanges, compliance and identity, marketplaces and liquidity, payments, data and analytics, and others.
On the basis of component, blockchain technology attained the highest growth in 2022.
This is attributed due to the growth of the blockchain technology segment in the DeFi market fuelled by several factors such as its ability to enhance security and eliminate single points of failure to attract both users and developers.
In addition, interoperability among different blockchain networks is improving, enabling seamless movement of assets and data.
Moreover, ongoing advancements in consensus mechanisms and scalability solutions address the challenges faced by early blockchain systems.
n other hand, smart contracts segment is attributed to be the fastest-growing segment during the forecast period.
The growth of smart contracts in the decentralized finance market is attributed to their efficiency, accuracy, and cost-effectiveness.
They eliminate the need for traditional intermediaries, reducing transaction costs and increasing transaction speed.
Moreover, the development of customizable and interoperable smart contract platforms paves the way for the creation of innovative financial products and services.
On the basis of region, North America attained the highest growth in the decentralized finance market in 2022.
This is attributed to the fact that the increasing adoption of blockchain technology and smart contracts, which form the foundation of many DeFi platforms.
These platforms offer a range of financial services such as lending, borrowing, trading, and yield farming, all without the need for intermediaries like traditional banks.
This trend is reshaping how individuals and institutions interact with financial instruments, enabling greater accessibility and control over their assets.
Meanwhile, the Asia-Pacific is considered to be the fastest-growing region during the forecast period.
As Asia Pacific region witnessing a surge in DeFi adoption due to its tech-savvy population, interest from governments in fostering financial inclusion, and the potential for more efficient cross-border payments.
Entrepreneurs are leveraging these trends to create innovative solutions, but regulatory hurdles must be addressed to unlock the full potential of decentralized finance market in the region.
The exponential growth of the decentralized finance market can be attributed to the simultaneous increase in spending and adoption of blockchain technology.
DeFi leverages blockchain’s fundamental features, including transparency, security, and immutability, to create a decentralized ecosystem that offers financial services without intermediaries.
As spending on blockchain technology rises, more robust and scalable platforms are developed, facilitating the expansion of DeFi applications.
This, in turn, attracts a wider user base, driving adoption.
Blockchain’s ability to ensure trustless transactions and automate processes enhances the efficiency of DeFi protocols, attracting both individual users and institutional players seeking streamlined, cost-effective financial solutions.
Moreover, the adoption of DeFi is further propelled by its inclusivity and accessibility.
Individuals without traditional banking access can participate in financial activities, such as lending, borrowing, and trading, through user-friendly interfaces and decentralized apps.
Moreover, the DeFi space continuously innovates, offering new services like yield farming, decentralized exchanges, and synthetic assets, all of which contribute to its expanding popularity.
Interoperability challenges among various DeFi platforms pose a significant obstacle to the growth of the decentralized finance market.
When different platforms cannot easily communicate and share data or assets, users face hurdles in transferring value seamlessly.
This lack of compatibility leads to fragmented liquidity pools, inhibiting efficient capital allocation and limiting trading opportunities.
Moreover, smart contract execution across platforms becomes complex and error-prone, potentially exposing users to security risks.
This lack of interoperability also discourages innovation as developers need to build within the constraints of specific platforms, slowing down the creation of new DeFi solutions.
Ultimately, these issues impede user adoption, deter institutional involvement, and constrain the overall expansion of the decentralized finance market.
To foster a thriving decentralized finance market, addressing and resolving these interoperability challenges is crucial.
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]]>The post Europol Report: An analysis of financial and economic crime appeared first on Payments Cards & Mobile.
]]>The criminal landscape constantly evolves, as criminals seek out new opportunities and exploit crises for their own interests.
Criminal actors involved in economic and financial crimes are highly adept at taking advantage of our economy for their purposes, and at targeting increasing numbers of victims.
They capitalise on vulnerabilities in society’s systems to generate billions in illicit profits, while applying various strategies, often cyber-enabled, to remain undetected and secure their earnings.
Financial crimes, and in particular money laundering, undermine our society not only by infiltrating the legal economy, but also by fostering the growth of a parallel underground society made of individuals who increasingly rely on organised crime for their economic sustenance and livelihood.
Vulnerable demographics, and especially vulnerable youngsters who are lacking trust in societal institutions and confidence in the rule of law, are the perfect target pool for such parallel underground society.
Due to their intrusive nature, financial and economic crimes are among the most challenging criminal activities to investigate and tackle.
A fragmented landscape sees different criminal actors interact with one another, making criminal operations more complex and tangled.
Key players typically remain anonymous and operate independently from established criminal structures, often from criminal safe havens.
Some recent investigations, including those exploring encrypted communications among criminals, gave unprecedented insight into the system that sustains the finances of organised crime.
While law enforcement is untangling the complexity of this underground financial ecosystem, information sharing, investigative focus on key criminal actors, development of technical knowledge and expertise, and public-private partnerships are essential tools for winning the fight against financial and economic crimes.
“In our globalised world, trade, technology and transport bring us closer together and create economic opportunities and prosperity. However, there is another side to the coin; our interconnected world is misused and abused by criminal actors involved in economic and financial crimes,” says Catherine De Bolle, Executive Director of Europol.
“In fact, organised crime has built a parallel global criminal economic and financial system around money laundering, illicit financial transfers and corruption. Criminals exploit these three practices to conceal, move, and ultimately benefit from their criminal profits.
The ability to launder illicit proceeds on an industrial scale, to move them through a web of criminal financial brokers, and to corrupt the relevant actors, has become indispensable for modern organised crime.”
The European Financial and Economic Crime Threat Assessment describes the complexities of financial and economic crimes, and the criminal ecosystem that virtually sustains and links all other criminal activities.
The report analyses all financial and economic crimes affecting the EU, such as money laundering, corruption, fraud, intellectual property crime, and commodity and currency counterfeiting.
It also illustrates the power of asset recovery in the fight against financial and economic crimes.
The analytical findings of the report rely on a combination of operational insights and strategic intelligence contributed to Europol by EU Member States and Europol’s partners, who provided crucial information regarding the criminals’ business models.
The report is intended to capture the pervasiveness and destructiveness of financial and economic crimes affecting the EU, and to support all relevant stakeholders in untangling the large variety of financial and economic crimes.
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]]>The post Why soft POS is taking over global acquiring appeared first on Payments Cards & Mobile.
]]>As more merchants adopt digital payments and consumers seek to replicate the speed and convenience of online payments in-store, soft POS offers merchants and consumers flexibility and choice while creating new opportunities for acquirers.
In Next-generation acquiring: why soft POS solutions are taking over, RS2 review growth projections for the number of merchants expected to switch to digital payments over the next decade and explain how technology advances and changing consumer behaviours are affecting the way merchants think about physical payment acceptance.
As consumers become accustomed to ordering online and having goods delivered to their homes, in-store shoppers want to replicate the simplicity and speed of this online experience, including the ability to pay with different forms such as Buy-Now-Pay-Later (BNPL), Account-to-Account (A2A) payments, digital wallets and more.
Consumers don’t want to stand in queues and expect value-added options such as loyalty and delivery to be included in their purchase experience.
The problem for merchants is that existing point of sale (POS) devices can be expensive and difficult to upgrade for new payment types, with older terminals incapable of accepting some payments or requiring manual updates for regulatory purposes.
To keep up with consumer expectations, the white paper says merchants need flexible and secure acquiring systems that fill the white space between the physical and digital economy, replicating the speed and convenience of digital check-out in-store.
Soft POS solutions sit on mobile devices and can be downloaded by merchants directly to the device.
RS2 explain why this makes them easy to install and upgrade, with new functionality or software updates occurring over-the-air and, for security updates, automatically in the background.
They can also be easily integrated with modern all-in-one solutions such as cloud-based Electronic Cash Registers (ECRs).
Responding to the cost pressures all merchants face at present, soft POS solutions are cheap or free to download in basic versions.
Installed on mobile devices, soft POS makes payment anywhere on the shop floor possible and includes the capacity to accept a multiplicity of payment types straight out of the box.
Functions such as loyalty points and delivery can be integrated with payment – replicating the convenience of online shopping.
Soft POS solutions can also communicate with other elements pf the retailer’s systems to create new opportunities such as app-to-app communication with online checkout so consumers can purchase online and pick up in-store immediately.
Download the new white paper from RS2 now for more on how soft POS solutions are taking over global acquiring.
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]]>The post US Watchdog eyes Google Pay and Apple Pay market access appeared first on Payments Cards & Mobile.
]]>Because Apple Pay and Google Pay dominate the mobile-device contactless market in the US, the constraints they impose on app developers’ ability to use the technology could inhibit consumer choice, the CFPB say.
Apple requires iOS device users to turn to Apple Pay for tap-to-pay transactions, barring direct integration with apps such as Venmo.
While Google’s Android operating system does not, the concern is that Google “could reverse this position in the future,” the bureau said.
Bureau Director Rohit Chopra said that Apple and Google are acting as “choke points” to the US payment system, cutting off innovation by keeping other apps out.
“Regulations imposed by Big Tech firms have a big impact on whether consumers and businesses can make payments using third-party apps,” Chopra said during a fintech conference organised by the Philadelphia Federal Reserve.
“We need strong challenges to dominant Wall Street banks and card networks,” he added. “But there is real concern that the largest technology firms will be able to erect even more gates and toll booths that will prevent the smallest firms from emerging, raising capital, growing, and succeeding even when they offer a superior technology.”
Chopra’s comments follow a long-awaited report published by the CFPB that focused on the impacts of Big Tech policies on tap-to-pay functions used on mobile devices like smartphones and watches.
Apple and Google set regulations that govern app developers’ ability to integrate NFC technology into their apps, which is needed to execute the tap-to-pay transactions. If an app does not comply with their regulations, the app can be denied access or face removal.
“There’s no comparable gatekeeper as we know for accessing service through a web browser,” Chopra said.
As of Q2 2023, Apple’s iOS operating system was on 55% of smartphones shipped in the US, and Google’s Android operating system was on 45% of smartphones shipped.
The dominant market share of these two operating systems, coupled with the increasing shift toward mobile device payments, underscores the important role their policies and practices play in retail payments.
Chopra says the CFPB is carefully evaluating the role Big Tech plays in banking and payments systems and that regulators will have to closely examine how business practices might impede a fair payment system for consumers, merchants, and nascent competitors.
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]]>The post Biannual Threats Report: Emerging fraud schemes in retail and e-commerce appeared first on Payments Cards & Mobile.
]]>This edition showcases a significant rise of phishing schemes proliferated through generative AI tools, and a marked increase in enumeration and ransomware.
The report also shows how Visa is working with law enforcement around the globe to bring perpetrators of fraud to justice.
While the global fraud rate trended lower than normal expected fraud levels during the report’s time period (January – June 2023), Visa shared that it helped to proactively block $30 billion in those time periods.
However, threat actors were successful in conducting targeted and sophisticated fraud schemes impacting specific institutions, technology, and processes.
Retail-specific schemes saw a measurable uptick during the past six months, including:
“While we are pleased by the lower-than-expected fraud rate over the last few months, this edition of the Biannual Threats Report continues to underscore just how savvy fraudsters continue to be,” said Paul Fabara, Chief Risk Officer at Visa.
“The same way criminals take advantage of technology advances, so does Visa, and the $30 billion of fraud prevented in the last six months alone is a great testament to that.”
Visa helped bring fraudsters to justice around the world. In May 2023, the US Secret Service took down a major cybercrime platform called Try2Check. Its administrator, Denis Gennadievich Kulkov, faces 20 years in prison.
A local enforcement action called Operation Urban Justice was launched in California targeting Electronic Benefit Transfer (EBT) fraud, which led to the arrest of 20 suspects believed to be part of an Eastern European crime syndicate.
In April 2023, an international law enforcement coalition led the Genesis Market Takedown, arresting 119 people involved with the cybercrime platform.
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]]>The post 10 emerging tech job titles for 2023 and beyond appeared first on Payments Cards & Mobile.
]]>New jobs emerge all the time thanks to the advance of technology and the past couple of years has been a period of rapid adjustment as generative AI technologies come to the fore. For example, the job title of prompt engineering is becoming a vital part of the AI ecosystem––but it didn’t exist a couple of years ago – writes Kirstie McDermott, Senior Content Manager, Amply.
Now, as workers and businesses accelerate the rapid adoption of platforms such as ChatGPT, this is a job with staying power and remuneration to match. Salaries in the US, for example, are reported to be between $230,000 and $335,000—and the number of job posts featuring the term “GPT” rose 51% between 2021 and 2022.
AI is just one area where new job titles are rapidly emerging and we can expect to see jobs for sentiment analysis, AI trainers, AI compliance manager and prediction analysers (among many others) emerge over the next few years.
But there are other sectors in which new jobs will emerge too. As the Internet of Things, augmented or extended reality, the metaverse, and blockchain technologies intertwine and embed themselves increasingly into our everyday lives, recent research has identified 10 potential key job titles of the future. They are:
Knowing what has the potential to come down the tracks is incredibly useful for tech workers, as this is a sector that is ever sensitive to change and the need for upskilling. Making small changes now can help to futureproof your career, so you’re ready when the time comes.
It’s a positive time for the UK labour market too. According to the UK Parliament, from April to June 2023, the number of people aged 16-plus in employment was 32.93 million, and while employment levels decreased by 66,000 in the last quarter, they’ve actually increased by 137,000 over the past year.
In tech, things look good too, with the sector’s contribution to the economy growing by 26.5% between 2010 and 2019. Around 1.7 million people are employed here in tech, adding over £150bn to the economy annually.
So if you are in the market for a new job, or just want to have a look at what’s out there, then the Payments Cards & Mobile Job Board should be the place you begin.
It contains thousands of roles all across the UK.
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]]>The post The future of UK payments: What’s on the horizon? appeared first on Payments Cards & Mobile.
]]>This article, originally published by B&B, intends to summarise the latest UK payments regulatory developments with regard to recent updates; the Future Regulatory Framework Review, the Financial Services Future Regulatory Framework, the Financial Services and Markets Act 2023 (FSMA 2023) and the Future of Payments Review (Mansion House speech 2023).
When the UK left the EU, EU legislation was retained becoming “retained EU law” (REUL).
The UK Government has since launched various reviews and consultations with the intention of reforming the financial markets framework under the Financial Services and Markets Act to give regulators primary authority over rules, with the intention that this could lead to long term economic growth and international competitiveness.
Coordination by Government and regulators such as the FCA and PRA is needed to minimise disruption across the financial sector.
Following the Financial Services Future Regulatory Framework Review (published 20 July 2022) the Government announced in their policy paper Building a Smarter Financial Services Framework (published 9 December 2022) as part of the Edinburgh reforms, their intention for the FCA to have rulemaking powers in relation to UK Payments regulation, which would provide the FCA with the necessary powers to make rules to replace REUL, where it doesn’t already have powers to do so, whilst still being held accountable by HM Treasury and Parliament.
The Treasury’s Future Framework Review (FRF) proposals explain the Government’s vision for the future of the UK’s financial services sector.
The review aimed to identify what the UK regulatory framework needs to thrive as a financial ecosystem outside of the EU.
The Treasury’s final response to the consultation (published in July 2022) provided the final policy around the FRF which is now implemented in the Financial Services and Markets Act 2023 (FSMA 2023) which recently received Royal Assent on 29 June 2023.
FSMA 2023 creates new requirements for the FCA and PRA to keep under review any new rules they make, whenever passed or made.
FSMA 2023 also requires the regulators to provide a statement of policy relating to the review of rules, as such the FCA have published their Rule Review Framework which is discussed further below.
The original, Financial Services and Markets Act 2000 provided the UK with a framework of legislation for the financial services sector and was intertwined with EU law.
The 2023 Act reforms this legislative framework by revoking retained EU law and aims to create a framework to better suit the UK market.
In addition, the FCA and PRA have greater powers to make rules and to regulate/create (‘firm-facing’) requirements in a way that is adapted to UK firms, markets and consumers.
It will involve incorporating retained EU law into the FCA handbook rules, with interdependences with the Treasury, Bank of England and PRA.
Among all the changes, FSMA 2023 sets out new objectives and regulatory principles for both regulators, the FCA and PRA:
(Includes some but not all the various changes made to FSMA 2023, with a focus on the changes to impact the payments sector).
Digital settlement assets (DSA) (Sections 22 and 23) |
“Digital settlement asset” a digital representation of value or rights, whether or not cryptographically secured, that, (a) can be used for the settlement of payment obligations, (b) can be transferred, stored or traded electronically, and (c) uses technology supporting the recording or storage of data (which may include distributed ledger technology).The definition has intentionally been drafted broadly to future proof regulation in-order to bring all existing and future fiat-backed stablecoins or DSA under the regulatory perimeter for systemic payments. The Treasury has power to amend the definition and issue a “recognition order” to DSA providers deemed to threaten the stability or confidence in the UK financial system or have serious consequences to businesses or other interests in the UK. Any systemic DSA payment system or service provider would be subject to regulation by the Bank of England and the PSR. In progress – The Government is preparing secondary legislation to bring stablecoins within the FCA’s perimeter. The Bank of England and the FCA will consult on their regulatory regimes before the end of the year. |
Financial promotion approval permissions (Section 55NA) |
The Act establishes a regulatory framework for the approval of financial promotions by the FCA. As a result, the FCA plan to establish a regulatory ‘gateway’ which an authorised firm must pass through before it is able to approve the financial promotions of unauthorised firms. The FCA consulted in December 2022 on how it would operationalise the gateway.
Now that FSMA 2023 has received Royal Assent, according the Regulatory Initiatives Grid 2023, the FCA will soon publish final rules including establishing a timeline for the opening and closing of the application period which will be published via statue. |
Cryptoassets (Section 69) |
“Cryptoasset” means any cryptographically secured digital representation of value or contractual rights that— (a) can be transferred, stored or traded electronically, and (b) that uses technology supporting the recording or storage of data (which may include distributed ledger technology).
Financial instruments, financial products and financial investments mentioned under Designated Activities under 71subsection (3)(b) of the Act may include cryptoassets, changes to the Act include the addition of cryptoassets to S21 of the Act (restrictions on financial promotions). The FCA have already consulted the industry and have provided a policy statement (published June 2023) setting out new requirements for cryptoasset promotions which will apply to all firms marketing cryptoassets to UK consumers, regardless of whether the firm is based overseas or what technology is used to make the promotion. The deadline to comply with the new rules for these firms is 8 October 2023). |
Designated activities regime (DAR) (Part 5A, Section 71k) |
Designated activity regulations may provide for an activity to be a designated activity only if the activity relates or is connected to— (a) the financial markets or exchanges of the United Kingdom, or (b) financial instruments, financial products or financial investments that are (or are proposed to be) issued or sold to, or by, persons in the United Kingdom.
These activities may also include cryptoassets. There are financial services-related activities in the retained EU law that are not ‘regulated activities’ under FSMA’s Regulated Activities Order (RAO). These are generally activities that are carried out by entities or individuals who are not authorised by or registered with the FCA. This means that we cannot make rules to cover these activities using our existing FSMA rule-making powers. The DAR will enable the Treasury to designate certain financial services-related activities, so that the FCA can regulate these activities irrespective of whether they are carried out by authorised persons. Anyone carrying out a designated activity will need to follow the DAR rules for that activity (Future Regulatory Framework (FRF) Review). |
Authorised push payment (APP) fraud reimbursement (Section 72) |
The PSR is required to create a new requirement for firms to reimburse victims of APP fraud in qualifying cases which the PSR regards as eligible. Under the Act, qualifying cases include payments made using the Faster Payment Scheme and payments being executed subsequent to fraud or dishonesty.
On June 7 2023 following a previous consultation, the PSR confirmed the new requirement for reimbursement and set out stages of consultation for the new rules expected to come into force in 2024. |
Access to cash (Schedule 8) |
A “cash access service” is— (a) a service which enables cash to be placed on a relevant current account (a “cash deposit service”), or (b) a service which enables cash to be withdrawn from a relevant current account (a “cash withdrawal service”).
Under the Act the FCA is responsible for ensuring the reasonable provision of cash access services in the UK. According to the FCA’s 2023 regulatory grid the FCA is expected to consult this summer. |
A framework for ‘critical third parties’ (Chapter 3C Section 312L of the Act) |
The Treasury may designate as a ‘critical third party’ to authorised service providers of financial market infrastructure firms (FMIs), if in the Treasury’s opinion a failure in, or disruption to the provision of services would threaten stability or confidence in the UK financial system.
The Treasury will take into consideration the materiality of services provided and the number of authorised service providers or FMI’s the entity provides services to. The FCA, PRA and Bank of England are the relevant regulators established by the Act for oversight of critical third parties, for which this will apply. A joint discussion paper (July 2022) and third party survey (April 2023) have already been conducted by joint regulators. FSMA 2023 creates a Financial Markets Infrastructure (FMI) sandbox. The sandbox will support firms which want to use new technology, such as distributed ledger technology, to provide infrastructure services in financial markets. The Treasury, BoE and FCA are in the process of creating secondary legislation on the sandbox which is expected in 2023. |
The FCA published a Rule Review Framework (published 14 July 2023), the review is a key part of the FSMA 2023 reform to ensure that the FCA has created a policy around it’s rule review. The FCA have developed this framework to explain how they will monitor and review that their rules are working in practice. This Framework applies to FCA rules found in the Handbook.
The Rule Review sets out the following framework:
The rules also set out how the FCA will consider international standards and regulations by global standard setting bodies to develop common approaches with other competent authorities.
The rule review framework is made up of three types of assessment, simplified as follows:
The FCA are collecting feedback from stakeholders until 15 September 2023.
In the Chancellor of the Exchequer’s Mansion House Speech (10 July 2023), the Chancellor set out the Government’s progress in delivering an open, green, and technologically advanced financial services sector. Among the statements of change was an announcement that almost 100 unnecessary pieces of retained EU law from the statute book, including parts of the Payments Accounts Regulations would be repealed.
In addition, the Government would be laying a statutory instrument to give the FCA sufficient rulemaking powers, and the PSR sufficient powers of direction, (for payment services and e-money) to replace EU law.
The Future of UK Payments Review was announced and published 11 July 2023, with the objective of considering how payments are likely to be made in the future.
The final report intends to make recommendations on the necessary steps to successfully deliver retail payments and boost UK payments and financial technology competitiveness. The independent review into the future of payments is chaired by Joe Garner, former Chief Executive Officer of Nationwide Building Society.
The Review seeks to answer the following three specific questions:
The call for input closes on 1 September 2023. Joe Gardener is expected to provide a report of recommendations to the Government in Autumn 2023.
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]]>The post Visa and Mastercard deny reports they will raise interchange fees appeared first on Payments Cards & Mobile.
]]>Now, Mastercard says it denies these media reports. “Last Wednesday, several media outlets covered a story from the Wall Street Journal about “credit card fees.” Unfortunately, the story is wrong,” says the statement.
The Wall Street Journal, citing sources and documents it had viewed, initially reported that fee increases were scheduled to start in October and April at Mastercard and rival Visa.
“The reporting relies upon a report produced by an advisory firm advocating for legislation currently under consideration in Congress,” Mastercard said in the statement.
“Mastercard is not raising interchange rates in the US this fall and has no plans to do so. Mastercard is not raising network fees in the US required for the processing of Mastercard transactions this fall.”
Visa also said in a blog post that recent press coverage on the issue was “misleading”, and that despite strong growth in the use of its cards, overall interchange fees on Visa transactions have been flat for the past decade.
“Now let’s set the record straight on recent misleading press coverage,” says the blog.
“There is growing demand for using and accepting Visa cards given the benefits and protections. In fact, since 2012, we have seen a 180% increase in Visa payment volume, a reflection that more consumers prefer to pay with Visa, resulting in increased sales for retailers large and small.
Despite strong growth in the use of Visa cards, our overall interchange fees on Visa transactions have been flat for the past decade.
Moreover, over the past three years, Visa has introduced programs to lower interchange for the vast majority of small businesses in the United States. For example, last year Visa lowered interchange 10% for 90% of US businesses to help with their recovery and growth.
Efforts by special interest groups to challenge these facts in the press are simply inaccurate and disappointing. Visa will not be deterred from upholding the promise of our brand – to be the best way to pay and be paid, for everyone everywhere.”
“We stand by our reporting,” the Wall Street Journal said in a statement.
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]]>The post Adyen granted UK banking authorisation appeared first on Payments Cards & Mobile.
]]>The UK banking authorisation allows Adyen to continue its UK operations in line with those offered today under the Temporary Permissions Regime.
This is consistent with its operations in Europe under its European banking license, allowing for a continuation of its high service levels post-Brexit.
The authorisation builds on Adyen’s global end-to-end financial technology capabilities. As a local acquirer, Adyen ensures it retains full control of its offering and that UK customers continue to benefit from its capabilities.
In addition, the authorisation secures Adyen’s position in the UK as a conduit for international commerce and growth facilitating payments, data insights, and financial services including its Embedded Financial Products in a single solution.
In addition, the license allows Adyen to continue to offer its recently launched embedded financial product suite in the UK.
This enables platform businesses to deliver financial products to their small and medium-sized businesses (SMB) users.
The suite includes: bank accounts, virtual or physical cards for simplified cash flow and expense management, and Capital, which provides SMBs with direct access to cash advances when they need them.
“Our focus is always on providing our customers with technology that helps them excel,” said Mariëtte Swart, Adyen’s Chief Legal & Compliance Officer.
“The UK is a key market for Adyen and we’re excited to cement our position here with this banking authorisation. It will strengthen our ability to help domestic and international businesses achieve their ambitions faster. It’s another stride towards it becoming a full spectrum global financial technology platform.”
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]]>The post Bank of China mandates digital yuan integration for retail scenarios appeared first on Payments Cards & Mobile.
]]>Mu spoke at the China International Service Trade Fair, emphasising the importance of wallet providers enabling digital yuan payments in all retail scenarios.
Mu particularly addressed prominent commercial banking apps like WeChat and Alipay, reminding them of their obligation to adhere to regulatory standards.
However, the key transformational aspect is centred around retail transactions. The aim is to integrate the digital renminbi, also known as the digital yuan, as the preferred payment method across a wide spectrum of platforms and retail scenarios.
However, a crucial caveat is that these platforms must operate within the framework of regulations, secure the necessary financial licences, and operate under governmental supervision.
In the immediate future, the focus is on standardising QR codes and achieving mutual recognition of barcodes.
Over the long term, substantial upgrades to payment tools will be implemented. This evolution will maintain existing business and regulatory models, ensuring a seamless transition.
The wholesale payment landscape will also see adjustments.
The central bank’s digital currency system will not replace current interbank payment systems and commercial bank intranets that support wholesale payments. Instead, they will be integrated and interconnected with the digital renminbi.
China has been actively developing its blockchain-based digital infrastructure, including the digital yuan.
In August, officials unveiled the Hangzhou Data Exchange, which utilises blockchain to streamline the exchange of corporate IT data.
Mu’s remarks highlight China’s commitment to ensuring the availability of the digital yuan in all retail payment scenarios, pushing stakeholders to prioritise compliance and get required financial licenses.
The central bank has been testing digital yuan in a number of pilot zones, but wider adoption is still a work in progress.
Mu also recommended adopting the digital yuan for wholesale financial market settlement, leveraging smart contracts to improve payment efficiency.
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]]>The post As uncertainty grows, SMEs should seek reliable, quality payment partners appeared first on Payments Cards & Mobile.
]]>During the webinar Ronnie d’Arienzo, Chief Commercial Officer at Freemarket, will be joined by Leda Glyptis, Author, NED and Fintech Advisor, and Jeremy Brown, COO of Atlantic Partners Asia to discuss how SMEs can find transparency, flexibility and value in payments. All are welcome to attend.
New data from FIS/Worldpay shows[1] e-commerce is set to hit $8.5 trillion by 2026, up from $6 trillion today.
That means growth of almost 10% each year over the next three years, with double that figure in emerging regions like Latin America, the Middle East and Africa.
“Cross-border B2B payments to surpass $40 trillion globally by 2024.”
This new appetite for online shopping explains why cross-border transactions are growing as a proportion of overall e-business.
According to research from Facts and Factors[2], cross-border transactions are growing at more than twice the rate of e-commerce overall (21.2%), and are expected to exceed $7.9 trillion in their own right by 2030.
Despite the great opportunities on offer, cross-border payments have long presented a problem for SMEs.
As long ago as 2019, research from banking infrastructure provider Banking Circle suggested[3] almost half of European SMEs were looking to move away from their bank as a provider of payments services, citing dissatisfaction with high fees, slow settlement times and poor transparency.
“Recent turmoil in US and European banking has tightened the range of services on offer and made banks more risk averse.”
These problems have not improved of late.
Recent turmoil in the banking sector has included the provision of a liquidity backstop for Credit Suisse prior to its takeover by UBS in March 2023, and the collapse of three regional banks in the US around the same time.
These events have led to growing regulatory pressure on European banks and reduced the pool of providers that can adequately service global payment needs.
Worse, these difficulties have made remaining providers more risk-averse and reluctant to engage in areas they see as higher risk such as crypto-currencies.
The upcoming webinar will discuss why, in uncertain times, it’s vital that clients of all sizes should have access to quality payment solutions.
That means letting clients know where their money is, when they can expect it to land in their bank account and the steps involved in the process.
It’s also important for payment providers to deliver value for money and high levels of client service – especially when clients need to move money across borders using non-traditional currency pairs.
Click here to take part in the webinar on 27th September.
ABOUT FREEMARKET: Freemarket has a long track record of delivering flexible payment and foreign exchange services tailored to SMEs’ specific needs. Our technology optimises existing products and services from global institutions, giving our customers access to high-quality foreign exchange and payment services at a cost previously reserved for major banks. We offer the reliability, choice and transparency companies need to take advantage of the massive opportunities afforded by the rise in cross-border shopping. Regulated by the UK’s FCA and with offices in London and Dublin, we provide access to banking services from some of the world’s largest institutions to regulated entities and corporates, freeing them up to focus on entering new markets and growing revenue.
[1] FIS/Worldpay, “The Global Payments Report 2023”
[2] Global Newswire, 30 January 2023, “Cross-border B2C e-commerce market size”
[3] Banking Circle, “Mind the Gap: SME payment services”
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]]>The post Huge appetite for embedded finance amongst UK banks appeared first on Payments Cards & Mobile.
]]>Carried out in collaboration with Censuswide during May 2023, Weavr’s research delves into ten crucial questions, extracting a wide range of thought-provoking answers.
While responses to the survey indicate embedded finance is a promising commercial growth opportunity, a significant number of businesses appear to lack a defined strategy to capitalise on it.
Embedded finance is a new set of models and technology, but it’s already a widely discussed topic among innovation, growth, and product leadership in banks.
Some have made impressive early moves in targeted areas such as BNPL, but for most banks it’s still early days for real-world product and partnership development, and beyond that, of visible go-to-market activity.
Executives from banks and financial firms express apprehensions regarding the compliance implications of potential implementations.
Such concerns may lead firms to undertake more cautious internally-focused R&D that approaches embedded finance without the benefit of leveraging external expertise, existing vendors and their technology.
Analysis in the whitepaper infers that banks may find themselves constructing fragmented, small-scale systems, missing out on the potential speed to market and scalability promised by a partnership approach.
UK banks and financial institutions are equally excited by the prospects of it and apprehensive of the challenges of execution in the face of the constantly increasing burden of regulation, most recently Consumer Duty.
Several banks are now seeking partnerships with embedded finance technology providers who can equip them with proven solutions that can scale with the support of the banks’ capabilities and balance sheets.
“What stood out most from the research was that 79% of execs in financial services firms in the UK are discussing embedded finance at least once per week,” says Alex Mifsud, CEO, Weavr.
“Given the broad audience surveyed, that is a truly extraordinary and surprising figure. The biggest single conclusion is that no financial services firm can ignore the exciting new distribution channel that is embedded finance.
Furthermore, more and more banking professionals are recognising that embedded finance innovation is not the same as Open Banking and cannot be expected to succeed if narrowly interpreted as a derivative of past efforts to develop premium APIs.”
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]]>The post US consumers love digital banks – why is the EU stalling? appeared first on Payments Cards & Mobile.
]]>While two-thirds of Americans, or some 220 million people, are projected to hold digital bank accounts by 2030, there has been much discussion about how far those accounts are used compared to traditional, in-person branch banking.
The phenomenon of “digital ghost” accounts is familiar in Europe, with Revolut’s chief executive claiming that “UK consumers don’t like us for some reason” in an interview with The Times of London in early May 2023.
In brief, the impression has been that consumers will sign up for digital services – but end up using their traditional bricks and mortar bank.
New work from NetBase Quid confirms that US consumers are now showing real appetite for digital banking and payment services.
While almost one in three Americans now use digital banks exclusively, the popularity of app-based services for those using both digital and physical banking is growing fast.
NetBase’s research says that the most popular apps are budgeting and tracking tools (used by 91 percent of digital banking customers), followed by peer-to-peer payments (90 percent), ATM locators (76 percent) and transferring funds between accounts (74 percent).
If the US, which was slower to digital, is finally waking up to its potential, then further signs of saturation are appearing in the more advanced European market.
In the UK, research from Accenture suggests just one in ten consumers currently use their digital bank account as their main account- barely a quarter of all account holders.
What’s more, one in three UK account holders still prefer to do their banking in person, rising to almost half (44 percent) of those over 55.
Don’t bank on a fully digital future. Amidst the hype of recent years, the reality of consumer intransigence is making itself felt.
While the US may be waking up to the power of digital, the more advanced markets of Europe are now seeing its downside, not least in terms of privacy concerns and what happens in the event of a technical system failure.
Most recently, the UK has joined Norway and Sweden in guaranteeing the right to access cash, while Swiss citizens look set to reject a move to all-digital payments in an upcoming referendum.
As our own research and other sources have confirmed, consumers are far from ready to take the leap from mixed payment methods to all-digital – and PSPs and banks should be planning for an “omnichannel” future, rather than pure digital.
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]]>The post Visa expand Merchant Acquirers stablecoin settlement capabilities appeared first on Payments Cards & Mobile.
]]>Through live pilots with issuers and acquirers, Visa has already moved millions of USDC between its partners over the Solana and Ethereum blockchain networks to settle fiat-denominated payments authorised over VisaNet.
When consumers use Visa cards to make a purchase at any of the millions of Visa-accepting merchant locations around the world, they experience near instant payment authorisations.
But what they don’t see is that the funds used for their purchase need to move between their bank (the issuer) and the merchant’s bank (the acquirer).
This is where Visa’s treasury and settlement systems enable the clearing, settlement and movement of billions in transactions a day, making sure the correct amount in the preferred currency is received from the issuer and sent to the acquirer.
This process happens seamlessly between nearly 15,000 financial institutions and across more than 25 currencies globally.
“By leveraging stablecoins like USDC and global blockchain networks like Solana and Ethereum, we’re helping to improve the speed of cross-border settlement and providing a modern option for our clients to easily send or receive funds from Visa’s treasury,” says Cuy Sheffield, Head of Crypto, Visa.
“Visa is committed to being on the forefront of digital currency and blockchain innovation and leveraging these new technologies to help improve the way we move money.”
In 2021, Visa began testing how USDC could be used inside its treasury operations which led to a pilot with Crypto.com, making Visa one of the first major payments networks to test stablecoin settlement on the issuance side.
This work led to a successful pilot leveraging USDC and the Ethereum blockchain to receive payments from Crypto.com for cross-border volume on their live card program in Australia.
Crypto.com now uses USDC to fulfill its settlement obligations on the Visa card in Australia and intends to roll out this capability in other markets.
Before that pilot, settlement for cross-border purchases made on Crypto.com Visa cards required a days-long currency conversion process and costly international wire transfers. N
ow, Crypto.com can send USDC cross-border over the Ethereum blockchain directly to a Visa treasury managed Circle account which helps reduce the time and complexity of international wire transfers.
While Visa’s treasury operation continues to test receiving funds onchain from multiple issuer partners, with these new settlement options Visa can send funds onchain to acquirers like Worldpay and Nuvei to help speed up settlement times for their merchants.
Worldpay and Nuvei are global acquirers serving merchants worldwide from a diverse range of sectors. This includes a growing number of merchants interacting with the blockchain and crypto economy including on-ramp providers, games, and NFT marketplaces who may prefer to receive stablecoins over traditional fiat currencies for the card payments they accept.
Using Visa’s own Circle account, Visa can now manage settlement payouts in USDC to Worldpay and Nuvei who can then route these payments in USDC to their end merchants.
As Visa looked to expand this capability to additional clients, there has been significant demand to leverage newer, high performance blockchains that can send and receive stablecoins with higher speed and lower costs.
For these reasons, Visa chose to add support for Solana as a high performance blockchain that its partners can choose to send or receive USDC settlement payments.
This makes it one of the first major payments companies at scale to directly utilise Solana for live settlement payments between its clients.
The Solana blockchain sees 400 millisecond block times, averages 400 transactions per second (TPS) and typically surges to more than 2K TPS1 across a variety of use cases during periods of peak demand.
“Stablecoins like USDC are cutting edge payments technology that can enable online businesses around the world to accelerate their growth,” comments Philip Fayer, Chair and CEO, Nuvei.
“Optimising cross-border transactions is only one use case where stablecoins can benefit businesses.”
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]]>The post UK Travel Rule goes live: This is what it means appeared first on Payments Cards & Mobile.
]]>Elliptic’s Mark Aruliah co-chaired CryptoUK industry working groups on the topic with Catarina Veloso from Notabene, and he personally worked on the guidance with the UK Treasury, the Financial Conduct Authority (FCA) and the JMLSG.
In this blog, Mark breaks down what the Travel Rule actually is, and discusses the challenges that UK crypto firms may face from the new obligations.
The obligations will require UK crypto asset firms to send beneficiary and originator information before or when making a digital asset transfer to another crypto company.
As mentioned in previous posts, this mirrors the fiat funds transfer obligations – more commonly referred to as the Travel Rule.
The new obligations will strengthen law enforcement’s ability to identify and take action more readily against bad actors.
As an ex-regulator, I welcome these obligations, but they do come with challenges.
I will continue to co-chair the CryptoUK working group and focus our attention on implementation challenges and provide a feedback loop to the FCA and the UK Treasury.
For me, the key challenge is that the UK Travel Rule regulations do not have a de minimis threshold or any other real form of proportionality (excluding transactions related to unhosted wallets, where there is a level of proportionality).
That, in essence, is the crux of the challenge for industry. The lack of clarity in terms of what firms have to do becomes apparent when dealing with transaction types.
For example, what does a UK crypto firm do when it:
Also, the lack of proportionality in relation to small monetary value transactions will incur costs to UK industry which may not be proportionate to the money laundering risk.
Given the extent of the industry dialogue, the UK Treasury and FCA will be aware of these challenges.
Nevertheless, it was disappointing that JMLSG did not include some of the recommendations from CryptoUK members that would have addressed a number of these issues.
That said, I very much appreciate the work that JMLSG has done to deliver this guidance in a timely manner to support the UK crypto industry.
I also understand, from my previous time at the FCA, the challenges when agreeing such guidance with a number of stakeholders.
The FCA did provide additional guidance on the Travel Rule obligations prior to the JMLSG’s aforementioned publication.
This was helpful, as it acknowledges the challenges that the UK crypto industry faces and it does address some of the elements I have raised above.
However, I think that the FCA guidance fell slightly short of providing the full clarity needed by industry, which means there is a risk that well-meaning UK crypto firms – which clearly want to comply fully – could inadvertently fall short of the supervisory expectations.
I am sure that my erstwhile FCA colleagues will come out with additional guidance to support the industry in the coming weeks. After all, the absence of such clarity will make supervision of firms more challenging if there is market confusion of the regulator’s viewpoint.
Furthermore, after working with the industry on this matter, I am confident that most are in dialogue with the FCA – so even if there is no further FCA guidance, there may be individual supervisory dialogue to allay concerns.
Industry preparation on this topic has been good, though firms may need some bedding-in time.
The greater challenge for the UK crypto industry may actually come next month, when the FCA’s financial promotion obligations go live.
Having managed the FCA’s financial promotion policy team for a period, I believe the challenges to the industry will be greater.
As there is a higher risk of investor harm, the FCA is likely to take a more active enforcement role to convey market messages.
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]]>The post Apple Pay Later gaining market share quickly – Who should be concerned appeared first on Payments Cards & Mobile.
]]>While it has only been a few short months since its release, a recent survey of 8,000 consumers shows how quickly Apple is making its presence in the market known.
According to J.D. Power survey respondents, Apple Pay Later has been used by more consumers than established brands such as Sezzle and Zip since its launch.
Nearly one-fifth (19%) of BNPL customers used Apple Pay Later in its first three months. PayPal was still the most-used BNPL brand over the same period (39%), with Afterpay (33%) as the next-most used brand.
The average Apple Pay Later user tended to be more financially healthy than most other BNPL customers, potentially giving it a more sustainable user base than its competitors.
That said, Apple did attract a higher percentage of overextended users vs. other brands in its early days, which may have resulted from existing BNPL users’ willingness to try a new payment option from what they consider a trusted brand.
It should come as no surprise that Apple was able to gobble customers up from BNPL competitors almost immediately.
Even after a tough 2022, the Apple brand is valued at $297.5 billion, making it the second most valuable brand in the world.
Customers report relatively high satisfaction with new Apple products when compared to solutions from companies with decades of experience in the same industry.
With its BNPL solution, Apple continues strengthening its financial services catalogue. But the company’s power doesn’t just come from its brand name. It also has a global network and vast resources to help it enter new markets seamlessly.
Apple has some sizable advantages over its BNPL competitors, who had to attract users and build merchant acceptance one at a time. Apple was able to instantly tap its army of Apple Pay users and existing global acceptance footprint to create instant scale.
The company immediately made Apple Pay Later available to millions of potential customers when it launched in March.
That’s because Apple Pay Later can be used wherever Apple Pay is accepted, including over 85% of US retailers, making it easy for consumers to access the service.
From a technological standpoint, Apple Pay Later can be directly managed within Apple Wallet, available to any customer with a compatible iPhone, iPad, Apple Watch, or Mac.
The company will also integrate the BNPL solution into its app store, which saw more than 650 million average weekly visitors in 2022.
The research also suggests that Apple may be attracting first-time customers who otherwise may never have considered BNPL as their preferred payment method.
The survey responses indicated that early adopters of Apple Pay Later were more sceptical of BNPL. They were more likely to agree with the sentiment that “BNPL lenders are predatory.”
They also responded with a lower-than-average agreement with the statements “BNPL options are helpful to consumers” and “BNPL is an option I wish I always had when buying things.”
This suggests many Apple Pay Later users may not have used BNPL through another provider before.
Apple may be leveraging its strong brand image and easy-to-use solution to attract BNPL users who would never have otherwise considered it a viable payment option.
Of its competitors, PayPal and Zip users were likelier than users of other BNPL brands to try Apple Pay Later. 17% of survey respondents who paid with PayPal most often and 17% who paid with Zip most often during the period said they tried Apple Pay Later as well.
Apple’s ability to attract shoppers who skew healthier and more sceptical of BNPL options may be most problematic for PayPal, which has traditionally attracted similar users.
Meanwhile, Zip has a higher proportion of young customers who may be more likely to move to Apple Pay Later because of their affinity for Apple-branded products.
Ultimately, no other BNPL company currently compares with Apple’s brand recognition, technological cachet, and network effects.
Even PayPal, a traditional payments juggernaut with a large base of active BNPL users and a brand valued at $75 billion, has its work cut out to withstand Apple’s entry into this space.
Time will tell if Apple’s growth in BNPL is fuelled more by new users or migration of existing users from other brands but, either way, the tech-giant-turned-fintech is off to a conspicuous start.
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]]>The post Verizon 2023 Payment Security Report appeared first on Payments Cards & Mobile.
]]>This update to the current PCI DSS standard, is the largest change since 2004. These updates will affect all organisations that store, process or transmit cardholder data, from e-commerce to the public sector.
Compliance with PCI DSS v4.0 is strongly encouraged by March 31, 2024 as v3.2.1 will expire.
The standard has numerous updates and 64 new requirements. As organisations navigate this new standard, the 2023 PSR provides the tools to address critical areas in security management program design to not only meet the deadline but also set an organisation up for long term success.
This includes the role of PCI security integration into larger corporate governance, risk management, and compliance initiatives as well as the tools needed for modern program design.
“Compliance is often seen as an added complexity to an already challenging task of securing digital payments in the face of evolving threat actor capabilities,” comments Kris Philipsen, Managing Director of Cybersecurity Consulting at Verizon.
“Fortunately, highly effective methods to achieving payment security compliance exist and have been outlined in the Verizon Payment Security Report that not only help make PCI DSS v4.0 outcomes highly predictable, but moreover allow organisations to achieve breakthrough performance enhancements in security program design.”
The top five insights businesses need to know:
1. As PCI DSS requirements evolve, so should security programs.
2. Data security and compliance success is achieved by design – not by luck.
3. Leading management methods simplify program management complexity, helping organizations to be economic and achieve more with less.
4. Organizations should design security programs to focus on what matters most, and overcome the most important constraints.
5. An integrated program management design can be applied to new programs and vastly improve existing programs.
Read the 2023 Payment Security Report and learn more about the best practices for organisations to implement the PCI DSS 4.0.
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]]>The post Half of UK consumers have ditched physical wallet for digital wallet appeared first on Payments Cards & Mobile.
]]>The study of 2,003 UK consumers suggests that the adoption of the digital wallet is a generational change in the UK, with 67% of shoppers who make purchases via their mobile wallet aged 18-24 comfortable without a physical wallet compared to just 37% of those over 45.
This generational difference appears to be driven by the loyalty benefits offered by mobile wallets, with 93% of consumers using a mobile wallet-based loyalty programme.
Mobile wallet usage has been steadily increasing in recent years, having now reached and exceeded $55,679 billion in global market value — and that value will continue to grow.
But the use case for mobile wallets now extends beyond payment alone. Customers today are finding that mobile wallets are an easy and convenient way to store loyalty cards, organise vouchers, and redeem coupons — particularly in physical retail stores.
Brands, in turn, find that mobile wallets offer a new way to reach a wide audience of mobile users, without needing an app.
Key cited benefits for those who purchase items using digital discounts or coupons include keeping discount codes organised (25%); the speed of purchase compared to paper counterparts (31%); and the ease with which you can check your savings (32%).
With almost two thirds (65%) of consumers actively comfortable using digital coupons/vouchers, and 64% for digital loyalty cards, these benefits are likely to become expectations as the technology continues to grow in adoption.
Just 9% said they were uncomfortable using digital coupons and vouchers, and 10% respectively said that they were uncomfortable using digital loyalty cards.
For those that don’t yet use mobile loyalty cards, the #1 reason is that they aren’t loyal enough to any one brand to justify adopting them.
With previous research from Emarsys finding the cost-of-living crisis saw 56% of consumers switch from a brand they were loyal to save money and 19% of consumers feel they could “no longer afford to be loyal”, so brands need to find the ‘value exchange’ that motivates customers to commit to a brand in that sense again.
“Today’s savvy consumers won’t tolerate poor experiences or rewards that miss the mark. Earning their loyalty means deeply understanding what each individual values and delivering it at precisely the right time on the channel they prefer,” explains Kelsey Jones, Global Head of Product Marketing at SAP Emarsys.
“Imagine checking out at your favourite store and simply pulling up your iPhone to pay with Apple Pay and there waiting for you in the palm of your hand, are the exact coupons and loyalty card you need in one place.”
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]]>The post Bank servicing of SME’s is getting worse appeared first on Payments Cards & Mobile.
]]>As long ago as 2019, banking infrastructure firm Banking Circle told us almost half of small businesses in Europe planned to switch away from banks, frustrated by high fees, slow settlement times and “vanilla” services.
“Fewer than half of in-store transactions complete without manual action in the US.”
A new study of US small businesses by J.D. Power shows this problem is not confined to the old world.
While laying the blame mainly on the growing cost of payments acceptance, J.D. Power’s work also outlines some striking declines in consumer satisfaction with payments both in-store and online.
For instance, fewer than half (43 percent) of transactions completed without assistance when customers use their credit or debit cards to pay in-store.
The situation online is little better, with 47 percent of transactions are completed without some type of retail customer assistance.
The most frequently cited problems include card declines, issues with contactless payments and receipt malfunctions.
Restaurants and very small businesses are the worst hit in the US.
In some ways, this is unsurprising as they face many of the same fee structures as bigger firms, but often have less than $1 million in annual revenue to meet those costs.
Restaurants and bars say they receive less support from their merchant services provider when it comes to understanding payment processing and fee structure.
They also have lower satisfaction with cost of service for in-person payment methods than with takeout/delivery e-commerce platforms.
On a brighter note, businesses using in-person mobile devices such as cellphones for payments record significantly higher satisfaction overall than those using older static POS devices.
“Mobile devices result in more completed transactions – and are preferred for customer service.”
Small businesses also say they have higher levels of customer satisfaction and faster problem resolution when using mobile apps to resolve customer payment problems compared to email, call centres or chatbots of various kinds.
Subject to confirmation by other studies, the news that fewer than half of in-person transactions cannot complete without manual input of some kind is not great.
While this might be as inconsequential as failed NFC transactions requiring a PIN, it will still affect the bottom line for merchants already seeing their margins eroded by rocketing inflation and costs.
Small and micro-merchants are those most likely to adopt so-called “soft POS” systems on their mobile devices, very often to avoid the cost of investing in a static POS system.
If the results of this study are accurate, this is good news indeed for tech companies selling these devices – and for the mobile generation born after 1990.
Payments Cards & Mobile is running two Webinars on the topic:
Weathering the storm: finding SME banking solutions in uncertain times: REGISTER HERE
Visa M of SME Research Briefing: REGISTER HERE
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]]>The post Digital wallets transaction value to surpass $16 trillion globally appeared first on Payments Cards & Mobile.
]]>This trend is driven by growth across both developed and developing markets, as the increased adoption of advanced services such as BNPL (Buy Now, Pay Later) and microloans drives end-user engagement.
The study found that in a highly congested wallets landscape, diversifying their appeal to users is vital.
The report identified advanced services as a key source of revenue growth for digital wallets. Advanced services, such as BNPL or microloans, are allowing digital wallet providers to diversify their revenue.
The popularity of BNPL, especially among younger consumers, will draw greater numbers of users, and generate additional revenue. This approach can be seen with Apple’s roll-out of add-on services, including Apple Pay Later.
“Advanced services give digital wallet providers an opportunity to differentiate themselves in a congested market and generate additional revenue,” says Research author Michael Greenwood.
“Super app strategies, which many digital wallets are pursuing, will rely on the effective deployment of advanced services at scale.”
In keeping with this, the volume of QR code payments in the leading Southeast Asian market will increase from 13 billion in 2023 to 90 billion in 2028.
High growth in Southeast Asia and other developing markets is largely down to financial inclusivity that QR payments offer; enabling unbanked users to access digital payments. Conversely, Western markets have seen very limited adoption; highlighting the global divide in QR payment markets.
National QR payment schemes, including India’s UPI and Brazil’s Pix, played a key role in encouraging market adoption, with their success driving implementation of national schemes in 2023 in Kenya and Bangladesh.
However, the research found significant growth to market volume will come from cross-border interoperability within Southeast Asian markets.
While international interoperability has been offered from payment providers like Alipay for years, national QR payment standards are now unifying across borders, like:
The adoption of QR payments overall in the west remains low.
However, according to the research, the area of QR P2P bank transfers has gained significant traction since 2022, with Belgium’s Payconiq and Spain’s Bizum used by a significant proportion of users.
Furthermore, Revolut and Vipps MobilePay have been promoting P2P and business-based QR solutions across Europe through reduced transaction fees.
To maximise adoption, payment providers should focus on offering competitive pricing versus established local payment methods.
The research found that security benefits are a key driver of digital wallet use in e-commerce in developed markets and with QR codes.
Many consumers do not wish to enter card information online. With digital wallets, this issue is reduced, as tokenisation enables card and other payment information to be used in a highly secure way.
The research also identified that as digital wallets become broader, including elements of digital identity, convenience will play a greater role; enabling wallet services to act as an all-inclusive app for financial wellbeing.
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]]>The post What the SEC’s court defeat by Grayscale means for bitcoin ETFs appeared first on Payments Cards & Mobile.
]]>One result was that the price of bitcoin subsequently shot up 7% to nearly $28,000. But that does not mean investors will be able to run out and buy a Grayscale spot ETF tomorrow.
Nor does it immediately doom efforts by the US Securities and Exchange Commission (SEC) to bring enforcement actions against some of the industry’s biggest players, including crypto exchanges Coinbase and Binance.
The story of the watchdog’s efforts to tame what it sees as a financial wild west still has some way to run.
A federal appeals court ruled that the SEC was wrong to reject Grayscale’s application to convert its flagship Grayscale Bitcoin Trust, which the SEC approved in 2015, and which holds more than $15 billion in bitcoin, into an ETF.
The SEC has allowed bitcoin futures ETFs since October 2021 but contended that spot funds were prone to manipulation, since crypto tokens trade on largely unregulated markets.
Judge Neomi Rao wrote in the decision that the SEC’s denial was “arbitrary and capricious because the commission failed to explain its different treatment of similar products”.
“This is a monumental step forward for American investors, the bitcoin ecosystem, and all those who have been advocating for bitcoin exposure through the added protections of the ETF wrapper,” Grayscale said in a statement.
The SEC has 45 days to decide whether to abide by the decision, ask the full federal appeals court in Washington to review it, or take an appeal straight to the Supreme Court. It said it was reviewing the decision.
Lawyers said Grayscale would have to file a new application for its ETF. But there is no guarantee that it will be approved, despite the court’s decision — the SEC could reject it on other grounds.
Indeed, investors still seem to think that the Grayscale trust’s conversion could get gummed up. One reason Grayscale has long sought to convert its trust into an ETF is that trusts, unlike ETFs, often trade at a discount to their holdings.
Even after Tuesday’s ruling, the Grayscale trust was still trading at a 20% discount, a sign that investors are wary that a conversion will happen soon.
Financial reform group Better Markets suggested that the agency could address the court’s concerns another way — by cancelling bitcoin futures ETFs rather than approving new spot products.
The ruling “does not change the fact that the bitcoin market is subject to fraud and manipulation or that an ETF would be a serious threat to investors”, said Dennis Kelleher, its chief executive.
The first European spot bitcoin ETF started trading earlier this month. In the US, there are more than a dozen other applications pending, including some from the largest US asset managers.
All of them would face similar questions about preventing market manipulation and how to price the asset at the end of the trading day, lawyers said.
Even though Grayscale had successfully challenged the SEC’s decision, there was no legal guarantee that it would jump to the front of the queue for review.
The most closely watched ETF proposal is from BlackRock, the world’s largest asset manager. It first filed in June 15, and the SEC officially added the BlackRock application to its docket on July 13, followed by similar proposals from Invesco, VanEck and WisdomTree.
All of them are coming up for preliminary deadlines this week.
SEC watchers said the commission would most likely impose a 45-day delay that puts the decisions off until mid-October.
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]]>The post Visa and Mastercard plan to increase US interchange fees appeared first on Payments Cards & Mobile.
]]>The changes could cost an additional $502 million in yearly fees, according to CMSPI, a merchants consulting firm.
Increases in network fees will make up a little more than half of that revenue, CMSPI estimated. The rest will come from increases in interchange fees
The economy of interchange fees is largely hidden from shoppers. But the fees are a major source of contention between the card networks and merchants large and small.
US merchants paid an estimated $93 billion in Visa and Mastercard credit-card fees last year, that was up from about $33 billion in 2012.
Merchants pass along at least some of that cost to consumers in the form of higher prices. More small businesses have started offering discounts to shoppers who pay by debit card, cash or check.
Card networks such as Visa and Mastercard set the fees that the merchants pay. Network fees get pocketed by Visa and Mastercard. Interchange fees go to the bank that issued the card.
Visa, Mastercard and the big banks have said the fees help cover costs related to fraud prevention and innovation. The banks often use the money they get from interchange fees to fund popular credit-card rewards programs.
Card fees and their effect on businesses have caught the attention of some in Congress.
Lawmakers recently reintroduced legislation in both the House and Senate that would give merchants the ability to process many Visa and Mastercard credit cards over alternate networks. A similar rule already exists for debit cards.
EU regulation introduced in 2015 capped interchange fees at 0.2% of the transaction value for debit cards and 0.3% for credit card.
But following the Brexit transition period, both networks raised the interchange fees for online payments between the EU and the UK to 1.15% for debit card transactions and 1.5% on credit cards, citing fraud and growing competition.
At the time Mastercard president for Europe, Mark Barnet, defended the fee increase saying: “We believe interchange fees [paid to banks for payments on their network] is the right mechanism for everybody, sharing the costs and benefits of the payment system. We think it represents incredibly good value.”
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]]>The post X moves into Super App territory with new payments licenses appeared first on Payments Cards & Mobile.
]]>Today those suspicions were confirmed as X’s Elon Musk announced it has obtained payments licenses from several US states in recent months – including a currency transmitter license in Rhode Island earlier this week.
While Musk has hinted at supporting crypto on the platform – even briefly switching out Twitter’s bird logo to dogecoin’s dog before its rebranding to X last month – the licenses allow for broader payments services to be offered.
Musk has said that he plans for X to expand beyond social media posts, becoming a Super App and the money transmitter licenses obtained since June from Arizona, Maryland, Georgia, Michigan, Missouri and New Hampshire indicate the company has plans to support payment processing nationwide similar to Venmo or PayPal.
The Rhode Island license, while essential for permitting payments, is also a requirement for offering crypto services.
“I think a new social media company is needed that is based on a blockchain and includes payments,” Musk said in a text message just days before the bombshell offer to buy Twitter for $43 billion back in April 2022.
In an FAQ answering common queries Rhode Island’s Department of Business Regulation (DBR) specifies that firms requiring the approval “include those transmitting money for its customers, including traditional wire transfers (like Western Union) and electronic transfers (like PayPal).”
The state’s currency transmission license is also required for conducting crypto exchange and custody business, with an exception for fintechs in “very rare cases” where the firm “is registered as a true ‘agent’ of the Rhode Island licensed currency transmitter…and money transmission is not the core profit-making business of the fintech.”
Though they certainly open the way for offering crypto payments, the state licenses are not limited or unique to that service.
In New Hampshire, “‘money transmission’ means engaging in the business of selling or issuing payment instruments or stored value, or receiving currency or monetary value for transmission to another location.”
The state also says “an administrator or exchanger that accepts and transmits a convertible virtual currency or buys or sells convertible virtual currency for any reason is a money transmitter under federal regulations…”
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]]>The post Swift demonstrates potential of tokenised assets with blockchain appeared first on Payments Cards & Mobile.
]]>The findings have potential to remove significant friction slowing the growth of tokenised asset markets and enable them to scale globally as they mature.
While tokenisation is in its infancy, 97% of institutional investors believe it will revolutionise asset management and be a positive force in the industry, not least because of its potential to increase efficiency, reduce costs and, by enabling fractional ownership, open up opportunities to more investors.
One issue challenging investors and institutions, however, is that tokenised assets are managed on different blockchains, each with its own functionality and liquidity profile.
Interoperability between these blockchains is crucial, otherwise financial institutions must build connections to each platform, creating significant operational challenges and cost.
Working with more than a dozen major financial institutions and market infrastructures and Chainlink, a leading Web3 services platform, Swift has successfully demonstrated that it can provide a single point of access to multiple networks using existing, secure infrastructure, thereby significantly reducing operational challenges and investment required for institutions to support the development of tokenised assets.
The experiments are part of Swift’s wider strategy to ensure secure, global interoperability as new technologies and platforms emerge.
They build on work over the past few years to show how Swift infrastructure could support the financial community in interconnecting Central Bank Digital Currencies (CBDCs) and other digital assets with new and existing payments systems.
Swift collaborated with several major financial institutions on the experiments, including Australia and New Zealand Banking Group Limited (ANZ), BNP Paribas, BNY Mellon, Citi, Clearstream, Euroclear, Lloyds Banking Group, SIX Digital Exchange (SDX) and The Depository Trust & Clearing Corporation.
Chainlink was used as an enterprise abstraction layer to securely connect the Swift network to the Ethereum Sepolia network, while Chainlink’s Cross-Chain Interoperability Protocol (CCIP) enabled complete interoperability between the source and destination blockchains.
In addition to demonstrating that existing Swift infrastructure can provide a secure, scalable way for financial institutions to connect to multiple types of blockchain, they advanced understanding around the technical and business requirements for interacting with business and public blockchains.
The experiments also explored the value of a blockchain interoperability protocol for securely transferring data between existing systems and a potentially unlimited number of blockchains.
The experiments looked at the design and technical development of a solution and considerations around data privacy and governance, operational risk, and legal liability.
Transfers of simulated tokenised assets took place – between two wallets on the same public Distributed Ledger Technology network; between two wallets on different public blockchains; and between a public and private blockchain network.
Swift will continue to work with the financial community to understand the most concrete use cases for tokenised asset adoption and will prioritise its efforts accordingly.
It is anticipated that the most compelling case, in the near term, will be in the secondary trading of non-listed assets and private markets.
“Interoperability is at the heart of everything we are doing at Swift to facilitate the seamless flow of value across the world in the face of increasing fragmentation,” comments Tom Zschach, Chief Innovation Officer at Swift.
“For tokenisation to reach its potential, institutions will need to be able to seamlessly connect with the whole financial ecosystem.
Our experiments have demonstrated clearly that existing secure and trusted Swift infrastructure can provide that central point of connectivity, removing a huge hurdle in the development of tokenisation and unlocking its potential.”
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]]>The post Tool up: can Data Analytics make a difference? appeared first on Payments Cards & Mobile.
]]>Recent advances in computing power and more efficient software development mean that some sophisticated services once reserved for large, wealthy corporates are now becoming more attainable, if not exactly going mainstream.
Automation, too, has played role: the widespread use of accounting packages such as Quickbooks and NetSuite testify to the extent technology has enabled smaller businesses to manage their own professional services.
In payments, providers have for some time been enabling access to highly sophisticated data analytics packages for smaller banks and retailers.
Previously reserved for those players large enough to either develop their own software or purchase systems on license, now analytics providers are offering so-called “Data Analytics as a Service”, or DAaaS, to smaller banks and retailers in exchange for a month-to-month or single-service fee.
This is big business: ResearchDive estimates the market for data analytics in payments will be worth around $4.8 billion by 2030, growing at just under 5 percent per year to the end of the decade.
The reason behind this success is that many banks are coming to realise their transaction data is a strategic gold-mine.
“Banks are increasingly seeing consumer transaction data as a strategic gold-mine.”
However, time and budget constraints mean most banks do not keep up with developments – or manage their data effectively. What’s more, current data management tools used by banks are inflexible, and expensive to introduce and maintain.
If managed and interpreted better, customer transaction data could lead to outstanding business performance, including cost/benefit analyses of card programs, more targeted and effective marketing activities, the development of new products and a great understanding of how, when, where and why customers use certain payment products.
Alex Reddish, Managing Director of payments infrastructure provider Tribe, says DAaaS services can provide benefit across the value chain, and are important for payments businesses that want to prepare for a market moving towards Open Finance.
“One of the key considerations when entering payments is complexity. Starting with the number of parties involved in initiating or accepting a transaction, to the unexplainable fee at the end which you get for making one – it’s confusing.
However, ignorance is no longer bliss. We talk a lot about hyper personalisation – we’ve all been to enough conferences where it has been spouted. But DAaaS genuinely brings this to life.
And we’re not just talking about banking apps notifying people on monthly overspend. We’re talking about Open Finance and the ability for financial data to be valuable and useful across multiple industries.”
One of the key uses of payment analytics comes in marketing.
If banks and retailers are able to gather, integrate and process payments data from sources such as cards, mobile wallets and bank transfers, it can lead to serious benefits.
Payments companies across the value chain can access insights into where their revenues come from and trends in how and when people are paying.
European payments solutions provider Nets has developed a suite of data analytics tools that filters and aggregates customer transaction data and analyses it to deliver reports that group and visualise customer behaviours.
Nexi say their solution saves business analysts time by aggregating transaction data and comparing it to customer profiles.
They also claim it can deliver novel analytics through segmentation.
“Business analysts can group transactions by product, customer demographic, time series, location and a host of other options”, says Andrej Anđelić, Account Executive at Nexi.
“Results can be compared against targets for that payment product, customer segment or other criteria, enabling the rapid development of an accurate, effective business strategy.”
Likewise, banks can use analytics in the fight against fraud.
According to a report from the Association of Certified Fraud Examiners’ Organizations (ACFEO) in the US, banks that use proactive data monitoring can reduce their fraud losses by an average of 54% and detect scams in half the time.
While the positives may sound attractive, data gathering and analysis is not without its challenges – not least of which is the increasingly vexed question of consumer privacy.
Across the EU, the UK, Canada, Australia, Japan and increasingly the US, consumers are waking up to the fact that their data can be of as much value to a company as their custom.
As a result, many companies face either an inability to collect data under national regulations, or the accretion of partial data sets from consumers who do not consent to the use of their data.
Without complete data sets, companies can risk drawing the wrong conclusions – that can be expensive when it comes to taking anti-fraud decisions.
To circumvent such issues, new providers are emerging that provide synthetic data sets to help banks and fintechs model the market, simulating loss events and consumer buying behaviours.
Synthetic data is ‘artificial’ data that maintains the same statistical properties as ‘real’ data, but generated using algorithms.
Whether the aim is to make data available across an organisation or accessible to third-party partners, synthetic data helps fintechs and banks make more accurate decisions while respecting consumer privacy.
In the UK, the FCA is testing the potential role of synthetic data in the way financial services test, design, develop and regulate.
While synthetic data may have its uses, it’s hard to imagine any synthetic data set that can capture the protean nature of the payments market, especially now as new payment types – not to mention new fraud types – are proliferating rapidly.
The fact that Data Analytics as a Service is now available to a wider range of players in payments can only be a good thing – in some ways.
It goes without saying that the capacity to assess and analyse existing customer behaviours will always be useful, since it can help to point out areas where service can improve – or where new products are required.
Likewise, if DAaaS points out where recurring fraud risks and losses are happening, that’s great.
As with so many additional services outside the basics of acquiring and processing, however, the payments C-suite should fight shy of seeing DAaaS by itself as a “silver bullet” – either for marketing, fraud prevention or anything else in fact.
In marketing, a wider appreciation of trends and good old-fashioned creativity and effectiveness count for a lot; and when it comes to fraud, there can be few things that work better than KYC which is as robust as possible, and strong customer authentications wherever necessary.
That said, DAaaS should prove a welcome addition to the toolkit for most banks, fintechs and service providers looking to compete both online and in store.
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]]>The post Open Banking payments hits new record milestone appeared first on Payments Cards & Mobile.
]]>Year-to-date data for 2023 against 2022 shows that total payments have doubled, showing an exceptional 102.4% growth.
This remarkable surge underscores the rapid pace at which Open Banking is reshaping the financial and payments landscape and reinforces the pivotal role it plays in driving financial inclusion, innovation, and consumer empowerment.
In July 2023, the number of active payment users surged to 4.2 million, a 10.5% rise from June 2023 and up 68.2% on July 2022.
This robust growth signals a growing use among consumers using Open Banking solutions to manage their finances effectively.
Among the key drivers of growth are single domestic payments, which recorded 10.5 million transactions in July, marking an 8% increase from June.
This was propelled by several significant events, including government payments solutions and the onboarding of leading UK financial institutions and investment platforms.
These institutions have introduced “pay by bank” options, allowing users to conveniently fund a wide variety of savings and investment products. Notably, these transactions align with the top three use cases for Open Banking transactions, ranked in order of volumes:
Variable recurring payments (VRPs) also saw substantial growth, with 872,000 transactions in July, representing a notable 28.7% increase on the previous month.
All-time data shows that single domestic payments have now reached 163.2 million. For the year-to-date the growth is more pronounced. Single domestic payments have surged to 65 million, showcasing a significant increase of 95.6% compared with the same period last year.
“The strong and sustained growth in Open Banking payments underscores the rapid pace at which Open Banking is reshaping the financial and payments landscape,” notes Marion King, Chair and Trustee of Open Banking Limited.
“It reinforces the pivotal role open banking plays in driving financial inclusion, innovation, and consumer empowerment.
As it continues to redefine the way people manage their finances, the doubling of total payments in just one a year is a remarkable achievement and testament to the transformative impact of Open Banking.”
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]]>The post Analysis finds Synthetic Identity Fraud growing to record levels appeared first on Payments Cards & Mobile.
]]>TransUnion found that synthetic identity fraud continues to be among the most prevalent, especially in the auto finance industry, with both incidences and lender exposure associated with such fraud reaching all-time highs.
Synthetic fraud is the use of personally identifiable information (PII) to fabricate a person or entity in order to commit a dishonest act for personal or financial gain.
Based on proprietary insights from TransUnion’s global intelligence network, the analysis demonstrates that while lender exposure to synthetic identity fraud remained relatively flat or even declined among some industries, the auto finance industry was a clear exception.
In H1 2023, US auto lenders saw an increase in total synthetic identity exposure, reaching $1.8 billion.
This represents a 38% rise year-over-year (YoY) and marks the second consecutive year of increased exposure in the auto finance industry.
These findings are based on the total credit amount a synthetic identity has access to for US auto loans, bank credit cards, retail credit cards and unsecured personal loans.
“Trade incidences and lender exposure associated with synthetic identities are both at all-time highs, and auto finance is the driving force of that growth,” comments Shai Cohen, senior vice president and global head of TruValidate fraud solutions at TransUnion.
“Exposures associated with synthetic identities are significantly higher for the auto finance industry than those we see for any other industry, and that margin is likely to grow as fraudsters continue to gravitate toward the industry that they perceive as the most profitable to them. Fraudsters secure their auto loans with a synthetic identity, and drive away with expensive, new vehicles, never to be seen again.”
In H1 2023, the retail and video gaming industries saw the highest rates of suspected digital fraud globally at 10.6% and 7.0%, respectively, followed by telecommunications at 5.3%.
Globally, insurance and logistics were the industries with the lowest suspected digital fraud attempt rate in H1 2023. Among all industries, the suspected digital fraud rate stood at 5.3%, up from 4.5% one year ago.
“When attempting to gauge the impact of digital fraud for any industry, fraud rates alone are an insufficient measure,” said Naureen Ali, vice president of product management at TransUnion.
“It’s important to look at the industry’s overall size based on the total number of transactions, along with how much that industry is growing. This helps one develop a more holistic perspective on the impact of fraud on these industries, along with an idea of where the fraudsters may be focusing in the future.”
When looking at industries from a global digital transaction growth perspective, the gaming industry (online sports betting, poker, etc.) stands out, showing a YoY increase in total transactions of 85.3%.
When the consumer is located in the US during the transaction, gaming had the highest suspected digital fraud attempt rate in H1 2023 at 10.2%.
However, the number of digital transactions coming from the US in that industry dropped when comparing H1 2022 to H1 2023 (down 18.5% YoY), potentially blunting the impact to an extent.
And while insurance saw a 61.2% increase in US digital transactions YoY, the suspected digital fraud rate remained relatively low at less than 1%.
The analysis also examined the volume and severity of data breaches for H1 2023 and compared them to previous years, using publicly available data.
Results showed that primary breaches increased 5% over H1 2023 as opposed to the same period in 2022.
This stands in comparison to third-party breaches, in which a business network is attacked via third-party vendors or suppliers, which declined YoY in H1 2023.
While a person’s name continues to be the most exposed individual credential, a Social Security Number has overtaken Date of Birth as the second most often exposed individual credential in breaches in H1 2023. Social Security Numbers were exposed in 69% of breaches, up from 60% last year.
Driver’s licenses or other state identification information were exposed in 31% in the first half of 2023, more than double last year’s 14% mark. Checking or savings account numbers also saw their exposure double year-over-year.
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]]>The post Canadians leave wallets at home – mobile payments surge appeared first on Payments Cards & Mobile.
]]>Over 1 billion of these mobile transactions have taken place within a 12-month period for the first time ever.
“While many Canadians shifted to contactless early in the pandemic, our data shows consumers are now going a step further as mobile payments become mainstream, particularly as younger Canadians influence those around them to follow suit,” said William Keliehor, Chief Commercial Officer, Interac Corp.
“Debit remains central to the way Canadians choose to pay, even as in-store and e-commerce transactions take new forms.”
According to a recent Interac survey, nearly eight in 10 (78%) Gen Z adults pay using their smartphone, well ahead of older demographics including their parents’ generation, Gen X (42%).
While Gen X Canadians appear to have more concerns about the security of mobile and contactless payments, their kids are influencing their payment habits.
Four in ten Gen Xers polled (41%) embrace payment options only after they have seen friends and family use them, while half of Gen Z respondents (52%) have taught older family members how to pay with their phone.
As we look to the future, nearly two thirds of Canadians polled (63%) expect that it will soon be normal to leave home without a physical wallet, knowing you can pay with a smartphone or smartwatch.
As of this month, TTC riders in Ontario can pay their fare with Interac Debit using their smartphone or physical debit card. This capability is set to fuel further growth in mobile transactions in the months to come.
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]]>The post How European merchants can avoid cart abandonment in Asia appeared first on Payments Cards & Mobile.
]]>JCB International has launched a new white paper aimed at supporting European merchants to address a common challenge in the e-commerce space: cart abandonment.
Merchants who proactively tackle cart abandonment will be able to capitalise on the ongoing growth of online shopping and to discover new opportunities in the global digital market.
The global e-commerce market is expected to continue its upward trajectory, reaching $6.3 trillion in 2023[ii].
The Asian market, in particular, has seen remarkable growth, with Southeast Asia alone accounting for five of the world’s ten fastest-growing e-commerce markets[iii].
This presents a significant opportunity for merchants in Europe as there is an increasing willingness among Asian shoppers to purchase online from businesses worldwide.
However, there is potential for even greater growth by tackling the perennial challenge of cart abandonment in the e-commerce space.
Doing so presents various benefits for merchants, such as increasing sales turnover, higher conversion rates, improved customer experience, and customer loyalty.
These, in turn, will give businesses a significant advantage as global e-commerce competition intensifies.
The primary causes of cart abandonment have been identified in the white paper, ‘Click into Place | Unpacking Cart Abandonment’.
This includes easy-to-implement solutions such as providing payment choice, showcasing clearly defined options, logos, local currency requirements, pricing, and implementing device-specific payment journeys.
With a particular focus on online spend from Asia, the white paper aims to help European merchants boost e-commerce sales and stand out from the crowd by providing best practice solutions to help encourage customers through checkout.
Accounting for 55% of the global consumer class (2.2 billion people), Asia has considerable spending power[iv]. However, despite a predicted online retail market of over $2.8 trillion by 2025[v], Asia Pacific has the highest cart abandonment rate in the world at over 84% in March 2023[vi].
Understanding the Asian customer can help merchants to capitalise on revenue potential and establish themselves as a cross-border purchasing option, with the scope of reducing cart abandonment levels.
“E-commerce sales are showing no signs of slowing down and catering for the needs of an international audience will become a priority,” explains Ray Shinzawa, Managing Director, JCB International (Europe).
“With Asian countries and regions becoming the world’s fastest-growing e-commerce market, understanding and exceeding the expectations of Asian customers represents the first step in tackling cart abandonment.”
“Cart abandonment is a pressing challenge that online merchants face as more players emerge,” continues Nick Fisher, General Manager, Sales & Marketing, JCB International (Europe).
“Adopting a proactive approach and leveraging expertise from the right partners can help merchants shift the narrative and transform a challenge into an opportunity.
While there is no one-size-fits-all solution, understanding the purchasing behaviours of your customers and ensuring the availability of their preferred payment option will put you in a far better position to reduce the number of abandoned carts and increase sales turnover.”
———————————————————————————————
[i] JCB Proprietary Data – as of June 2023
[ii] 38 E-Commerce Statistics of 2023 | Forbes (Forbes.com) – as of May 2023
[iii] Southeast Asia sees the fastest digital sales growth in the world | Insider Intelligence (insideintelligence.com) – as of May 2023
[iv] Asia’s consumer class is growing. This chart shows how | World Economic Forum (weforum.org) – as of May 2023
[v] Online Retail in Asia Pacific Will Add US$1 Trillion By 2025 | Forrester (forrester.com) – as of May 2023
[vi] eCommerce Benchmarks | Dynamic Yield (marketing.dynamicyield.com) – as of May 2023
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]]>The post 3 great jobs of the week in uk neobanking appeared first on Payments Cards & Mobile.
]]>For end users, the appeal is obvious: neobanks such as Revolut, Curve, GoHenry and Monzo offer a customer-centric approach that provides not just traditional account management via a mobile phone, but crucially, ease of use.
UK customers are more than willing to manage their money online too, with 74% of the public saying that challenger banks are safe to use. That compares to 70% of those in France and Spain, 57% of Americans, 56% in Germany, and just 53% in Hong Kong– writes Kirstie McDermott, Senior Content Manager, Amply.
These disruptive forces in banking have revolutionised the sector, and data compiled by Statista shows that compared to other European countries, the UK has a higher than average fintech products and services adoption rate.
Despite a slowdown in funding this year, the UK fintech scene remains buoyant, and as a result, neobanks are rapidly expanding, hiring at pace and attracting some of the best talent within the tech and finance industries.
For employees, the appeal is obvious. There’s the chance to work at a fast-paced startup, making a real impact on the tech, and gain a lot more ownership over your own work.
Flat structures typical of early-stage companies can offer more access to influential people which can help to progress your career, and because early-stage companies tend not to have super-siloed roles, you’ll get the chance to do new and exciting things that stretch and expand your own skillset.
For professionals with experience in traditional banking, a sector switch can offer meaningful work, more money and the benefits tech workers have come to expect. Many digital-first banks have embraced remote working as well, which is highly valued post-pandemic as return to office mandates bite.
The Payments Cards & Mobile Job Board is a great place to begin a search for a new role within the UK neobanking sector. There are thousands of roles available all across the UK––discover three of the most exciting fintech jobs currently on offer below.
In this Senior Security Infrastructure Engineer role at Metro Bank, you’ll analyse and triage security events, ensuring the right actions are taken including the full spectrum of incident response where required. You’ll manage infrastructure security requests, problems and change tickets, and be responsible for the technical delivery, maintenance and scalability requirements of new and existing production security infrastructure, including IDS/NBA, NAC, WAF, content filtering, DLP and CASB systems. Additionally you’ll contribute to the development and maintenance of security policies, standards, processes, procedures and technical documentation including their implementation, maintenance and compliance. To be considered, you will need IT security infrastructure and engineering experience, which is fundamental to this role. Proven experience working with cloud environments (Azure and/or AWS) and a deep understanding of network protocols, networks and security systems (e.g. security proxies, SASE, WAF, email security gateways, SSO, CASB, DLP, IDS, IPS, NAC). Find out lots more here.
Revolut is looking for a FinCrime Compliance Assurance Manager to help improve all aspects of fincrime and risk management. Day-to-day️, you’ll be assisting with the design and implementation of the compliance testing and assurance program, including risk-based compliance assessment, control testing and assurance plan, and related testing scopes. Plus, you’ll complete assurance reviews and testing activities, leveraging skills in advanced data analytics, among other duties. To be considered, you’ll need three or more years’ of experience working within a fintech, traditional financial institution, or regulatory body, relevant experience in assurance or internal/external audit, focusing on risk and compliance domains, plus familiarity with assurance/audit reviews. See all the requirements now.
Formed when its founders realised changes to the way consumers shop and spend money wasn’t being reflected in the banking world, Zilch is a hyper-growth fintech company that allows customers to split payments over several weeks. The Credit Risk Analyst will work with the wider team to contribute to existing initiatives, develop new strategies and confidently make recommendations. You should be an analyst who is keen to contribute to existing initiatives, develop new strategies and confident to make recommendations, and have a strong understanding of how the lending/credit card/BNPL industry works. A champion of metrics and the measurement of impact, you can explain the “Why”, not just the “What”, and are a team player who enjoys a collaborative and fast paced agile environment. Apply online for this job.
Discover jobs all across the fintech sector on the Payments Cards & Mobile Job Board
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