Virtual Skinny FinTech: Stick the Landing

Posted by The Virtual Skinny on August 14, 2016 in FinTech Edition, Newsletter 0 Comment

8.14.2016

THE SKINNY

When You Stick to the Plan …

Even though Britain said yes to Brexit, it’s still got lofty goals to be the center of all things fintech. (BTW, Brexit means that time Britain voted to leave the European Union then immediately regretted it).

When You Keep On Keeping on…

Two years. That’s how long it’ll take for Britain to exit stage left (if it actually happens). It’s also the deadline that Britain’s Competition Market Authority (CMA) is giving British banks to stop being stingy with their customers’ data.

When You Know What’s Up…

CMA is very aware that bank fees can be…excessive. Customers are paying up but aren’t getting what they deserve. Enter fintech companies. CMA is drinking the ‘fintech koolaid’ and wants banks to share customer data with fintech startups and third party apps. Bank customers must approve first of course.

When ‘Many People Are Saying It…’

CMA thinks by 2018, fintech will not only help save British bank customers money and get them better services but also earn the economy the top spot in “fintech” around the world.

When You Need to Watch Your Back…

About that Brexit thing. No one knows exactly how Britain saying ‘bye’ to the EU will play out. But, Germany’s taking full advantage. It’s on a full on recruitment mode to get fintech companies based in London to hop on over to Deutschland. Do you blame them?

WHAT ELSE IS GOING ON?

Lies, Fairytales, and Fallacies…

Chip and pin cards (we’ve covered this; those cards you dip instead of swipe) were supposed to protect us from thieves. But, it’s not as safe as you think. Payment technology company NCR just unveiled a way for fraudsters to still get at your money. Apparently, they’ve used their genius for evil to figure out how to make chip cards seem cardless. Then, it’s off to the races. Retailers are thinking, ‘more reason not to buy those EMV card reader machines.’ But, it’s not all a lost cause, even with this security flaw, chip and pin cards are still slightly safer than regular ole swipe cards.

THE STREETS ARE TALKIN’

Thanks to Square Capital aka Square’s lending business, the company’s stock is wayyy up. It should feel blessed. Square Capital doles out loans to the company’s existing merchants in exchange for a piece of merchants’ sales. It’s all love all around (for now). Merchants love that they can get loans fast (within a few days) and low default rates. Investors love it too. But, to keep growing, Square Capital will have to do something else (e.g., handing over $$$ to non-Square merchants).

The war on cash in Boston is on its way. Boston area eateries like Sweet Green, Amsterdam Falafelshop, and Clover Food trucks want to go cash-less. They’ve picked up on the trend that young people are choosing plastic over paper when it comes to payment. But, a little known law in Massachusetts makes it illegal to turn down cash. The law and how it’s enforced is all very wishy-washy. But, seems like shops are willing to take the risk.

Been Around the World, Uh Huh

India’s mobile phone game is strong (smartphones are up 220 million making it the second largest market in the world). Should be good news for financial inclusion but not so much. Not many rural and underbanked folks are using their phones for banking or payment. And, taxes for use aren’t helping. But, the Indian government won’t be giving up on this.

The Nigerian Central Bank likes to walk the road less traveled when it comes to remittances (transferring money across borders from one country to another). The rest of the world wants to cut down costs on remittances. But, no. Not Nigeria. It’s going the opposite way. No secret that Nigeria’s economy is struggling. So to ‘maintain the exchange rate’ it’s up-ing the price on remittances.

In other news dealing with the continent, the Brookings Institute (U.S. think tank) says more regulations protecting consumers will help grow financial inclusion and innovation in countries like Kenya, South Africa, Uganda, Rwanda and Nigeria. Interesting since, a lack of banking regulations is a major reason money transfer service M-PESA is a success in Kenya …

Australia’s postal service is looking to the future. It’s looking into applying blockchain technology to the mail – mainly for identity reasons.

8.3.2016 – Virtual Skinny FinTech: Move It or Lose It

Posted by The Virtual Skinny on August 3, 2016 in FinTech Edition, Newsletter 0 Comment

8.3.2016

Good to Know: We want to get your thoughts. Take our poll below!

THE SKINNY

When You Can’t Beat ‘Em …

Join ‘em. Wells Fargo, JP Morgan, Bank of America, and US Bank are all jumping on the instant cash bandwagon.

When You Don’t Really Have A Choice …

Their hands have been forced. In the U.S., moving money between bank accounts is slow AF. Mobile services like PayPal’s Venmo and Square Cash handled the issue…Customers love it … Now U.S. banks don’t want to get left behind.

When Your Age is Showing …

Banks have tried to pull an Instagram by offering their very own money transfer apps. Think Chase QuickPay. But, it isn’t quite the same ‘copy and paste’ job Instagram just pulled on Snapchat (read more on that later this week in our Internet & Tech edition). They want customers to believe that their apps are just as ‘hip and cool’ as the Venmos of the world with the help of star-power ads. But, some people aren’t buying it.

When You’re Not Leading From Behind…

The U.S. is playing ‘follow the leader’ with the rest of the world when it comes to faster payments. Note to self: The U.S. is doing the following. So, the Federal Reserve Board’s ‘Faster Payments Committee’ is telling banks to ‘pick up the pace’ on money transfers.

When You Need to Make A Move …

Meanwhile everyone and their moms in the financial ecosystem (including financial OGs like Mastercard and Visa) are in an arms race to build the “payments network of the future.” Mastercard snatched up a huge chunk of Vocalink, a UK biz with a mobile and internet payment network, and Visa’s strategically linked up with Paypal.

When You’re Just Happy to be Here …

Since people are still using the cash money and writing checks, there’s lots of opportunity to get in on the instant payments action. It won’t be easy for banks to catch up with Venmo and other peer-to-peer apps that are hybrid payment and social platforms. But, at least U.S. banks are making moves.

PENNY FOR YOUR THOUGHTS?

Now that banks are stepping up their instant payments game, are you willing to give up your current money transfer app (i.e., Venmo, Square Cash, etc) and give your bank’s app a go?

WHAT ELSE IS GOING ON?

Ain’t Nobody Got Time for That …

The U.S. is still trying to get consumers to dip their credit cards rather than swipe them. Turns out chip and pin cards aka EMV cards aka cards that keep us waiting at checkout for life are way more secure and help cut back on fraud. That’s great and all, but we hear that making just two purchases daily for a year with an EMV card adds up. It’s literally 85 minutes of our lives that we’ll never get back just waiting to check out. No bueno! Even retailers want to avoid installing EMV card readers because long lines aren’t good for biz. Only 28% of all U.S. merchants require dips v. swipes. Shopping at places that take Apple, Android, or Samsung Pay may be a better, faster option. Meanwhile, some of us will continue to struggle with the process.

And The Winner Is…

We hope China’s been practicing it’s surprise face and pageant wave. The U.S. Department of Commerce just crowned Asia’s largest economy as the 2017 Fintech Leader. Expect China to lead the world in payment exports.

Sorry Seems To Be The Hardest Word …

Banks in Africa are are like that ex who took you for granted but now wants to make things right. Sure, they did the basics like setting up infrastructure but didn’t go the extra mile to take care of everyone’s needs. Banks on the continent dropped the ball on figuring out mobile money services and left potential bankers out of the loop. Now that fintech startups have stepped in to offer way better services that can help way more people, the banks are seeing the error of their ways. To right their wrongs, banks are teaming up with startups like MFS Africa and Nomanini to reach untraditional young consumers.

THE STREETS ARE TALKIN’

Hong-Kong based Bitcoin exchange Bitfinex told us its system had been compromised. Like thieves in the night, hackers allegedly made off with a cool US $65 million in real money. The exchange is looking into the breach. In the meantime, Bitcoin’s value dropped by 7.8 percent earlier this week.

China’s got a trust problem with its charity organizations. Alibaba’s CEO Jack Ma wants to use blockchain technology to make sure charities are using donations for the right purposes. Alibaba’s Ant Financial is leading the effort on this. Transparency FTW …

The charity world is pretty old school when it comes to donations. It’s all about those cash money donations. But, you can only give what you have. So, if people are short on dolla bills, charities are SOL. DipJar wants to change that up by allowing people to donate with credit or debit cards for “impulsive, on-the-spot giving.”

While Alibaba’s trying to figure out this blockchain situation, IBM seems to be way ahead of them. The tech company is all set to kick off the first major implementation of the technology for its business. IBM’s figured out how to use the technology to settle financial disputes between partners and customers. #NBD

One last thing on the checkout process, Venmo’s no longer for just easily reimbursing your friends. It’s branching out into checkout services for retail apps. Buying things you probably don’t need just got easier…

Virtual Skinny FinTech Ed: Trending …

Posted by The Virtual Skinny on May 4, 2016 in FinTech Edition, Newsletter 0 Comment

5.4.2016

Good to Know: Dr. Craig Wright was trending on social media earlier this week. The Australian entrepreneur claims that his alias is Satoshi Nakamoto, creator of virtual currency bitcoin. Some people are giving him major side eye, but he allegedly has “extraordinary proof.” Apparently, he’s got receipts.

THE SKINNY

When You’ve Moved Onto Something Else …

Dr. Craig Wright had the Interwebs abuzz. But at this week’s Consensus 2016 conference in New York City, execs said yawn. Newsflash: They don’t care about bitcoin.

When You’re TRENDING…

Bitcoin is out. But, the blockchain (bitcoin’s underlying technology aka a huge public ledger that records all bitcoin transactions) is in.

When You’re Not Sure What To Do …

For now, bitcoin as a virtual currency is the only application that works across the globe via the blockchain. But, we could see other applications popping up as fintech startups and major tech companies like IBM and Microsoft are working on different apps for the blockchain. How fast these experiments turn into something real comes down to one question: Small scale projects or moonshots? In other words, do companies want to take on a major project all at once or take their time with small-scale stuff?

When You’re Curious …

What’s the better approach? Working on small, achievable applications or taking the risk and shooting for the stars? Tell us in the comments!

WHAT ELSE IS GOING ON?

Keeping It on the D.L…

While many financial peeps gathered this week in NYC, a select group including NASDAQ, Citigroup Inc., Visa Inc., Fidelity, Fiserv Inc., Pfizer Inc., had a pow-wow on the down low back in April. Yes, there was talk of the blockchain. But, we heard that digital U.S. dollars as an alternative to virtual coins like bitcoin came up too. Fiserv Inc. even created a digital dollar for show and tell.

SPOTLIGHT

CBS 60 Minutes Lesley Stahl talked fintech on this past Sunday’s episode. She sat down with John and Patrick Collison, Irish brothers and co-founders of payments company Stripe. The whole point of the company is to allow small businesses to get their online payments from anywhere in the world hassle-free. Check it out here.

QUICK POLL – RUN THOSE NUMBERS …

Young people are into their Venmo app, and the numbers prove it. It’s grown 154 percent from last year.

THE STREETS ARE TALKIN’

Young people may heart Venmo, but the U.S. Federal Trade Commission won’t be saying “Venmo, me.” The agency, which is responsible for making sure businesses are on the up and up with their practices, is looking into the PayPal-owned, peer-to-peer payment service for “unfair and deceptive” practices. BTW, Venmo would appreciate if U.S. users stayed clear of using words like “Syria” and “Cuba” on Venmo on account of it’s still illegal to send money to those countries.

San Francisco startup Varo Inc. is building mobile banking app complete with deposit accounts, budgeting tools, and other services. For now, it’s looking to partner with banks but eventually wants to be a bank of its own. New U.S. bank these days? Don’t see that every day.

Android Pay is now an official payment options for your Uber rides.

Virtual Skinny FinTech Edition: The Block Is Hot …

Posted by The Virtual Skinny on April 6, 2016 in FinTech Edition, Newsletter

4.6.2016

Good to Know: “ We are actively exploring these issues and their implications.” – U.S. Securities and Exchange Chairwoman Mary Jo White putting everyone on notice that she gets that blockchain tech is en fuego and her agency’s got its regulatory eye out.

THE SKINNY

When You’re Not About Empty Threats …

Payments company PayPal had plans to set up shop (costing US $3.6 million) in North Carolina (NC). But, not anymore. It’s put the kibosh on that.

When You Need To Get Caught Up …

NC is pretty committed to what could be called its new LGBT discrimination law. Back in March, NC passed a law preventing cities from protecting the LGBT community and banning transgender people from using restrooms or locker rooms for the gender not listed on their birth certificates.

When You Don’t Listen …

The company’s CEO Dan Schulman joined a letter with over 80 other tech execs. The letter listed all the reasons why the then-bill was not a good look. The execs even warned that quality professionals would peace out of the state.

When You’re Back On the Market …

NC ignored the letter, passed the bill anyway, and now PayPal (and other projects) are back on the market and are looking for alternative locations. NC, say goodbye to what would have been 400 new jobs and US $3.6 million, at the very least…

WHAT ELSE IS GOING ON?

Still DEL(ly) From The Block …

The U.S. state of Delaware is a fan of the blockchain. State governor Jack Markell just let the cat out the bag on what the state is calling “the Delaware Blockchain Initiative.” It’s the state’s way of saying to businesses incorporated there that they need to get up-close and personal with distributed ledgers and smart contract technologies. Kind of a big deal. BTW, if you want to hear more details on this from Markell, catch him giving the keynote at this year’s Consensus 2016 conference, which will be held from May 2- May 4, 2016 in the concrete jungle where dreams are made of…

QUICK POLL – RUN THOSE NUMBERS …

Check out all the fintech startups for all your banking needs …

THE STREETS ARE TALKIN’

When money goes social … PayPal-owned Venmo is now a thing with young people. And, it’s not all about the money. They just want to know what their friends are getting into on the app.

Owe your co-workers some coins? With the help of startup Current, workplace messaging app Slack will soon offer money transfer services to help you settle your office debt.

The British government just gave the go ahead to Boston-based startup Circle. In other words, for the first time, the government has given an electronic money license to a virtual currency company. London … Building its Innovation Hub one fintech startup at a time.

Speaking of building empires … Amazon is looking to make some fintech-related purchases.

Virtual Skinny FinTech Ed: In the Clear …

Posted by The Virtual Skinny on January 27, 2016 in FinTech Edition, Newsletter

1.27.2016

Good to Know: Spread the word! The Virtual Skinny’s weekly FinTech is here. Tell your peeps to sign up here.

THE SKINNY

When Everyone’s Talking About You …

At last week’s World Economic Forum in Davos, Switzerland, “fintech” was all the rage. Apparently, the term is no longer just for startup companies using technology to shake up the financial services industry. Traditional banks are saying they are about that “fintech” life too.

When You’re Not Quite Part of the Convo …

Though fintech was the talk of the town and startup execs made their first trip to Davos, incumbents were still running things and led discussions about the “Fourth Industrial Revolution” and “The Transformation of Finance.” It’s an interesting time, especially since old-school financial firms have as much as US $150 billion of revenue to lose to fintech startups according to consulting company Oliver Wyman.

When Someone Rains On Your Parade…

Not everyone is buying into the fintech hype, some bankers are pointing out major hurdles like regulation. Large banks also want to make sure that the new kids on the block play fair when it comes to offering consumer services. Not to mention, there’s talk on Wall Street. that fintech upstarts may have already reached their peak. Cue companies folding and/or merging with banks, potentially.

When You Have Other Options …

European officials like Dutch Finance Minister Jeroen Dijsselbloem aren’t shying away from fintech. Turns out that Dijsselbloem thinks European economies are way too reliant on traditional banking. He says alternatives are a good thing, and regulators should embrace that. Financing options are good for people and small- and medium-sized businesses.

WHAT ELSE IS GOING ON?

Belle of the Ball…

Also at Davos, ex-JPMorgan Chase exec Blythe Masters just pulled US $52 million to fund her blockchain technology startup Digital Asset Holdings (DAH). Where’d the money come from? A bunch of banks including Masters’ former employer forked over cash to help fund the new company, but it took longer than expected. Some banks opted out all together. Literally everyone is talking about “blockchain this” and “blockchain that,” but the technology’s real world uses haven’t quite caught up to talk of its potential. But, Australia’s main stock exchange, ASX, is on board. It inked a deal with DAH to settle trades and transfer money faster.

THE STREETS ARE TALKIN’

Peer-to-peer money transfer app Venmo is looking to make some money this year, and it plans to use its new feature “Pay with Venmo” to do just that starting today. Think of it as an alternative to paying for stuff online with your credit card.

Alternative lending startup Social Finance (SoFi) wants you to know who they are so it’s willing to shell out 20% of its annual budget for an ad spot during this year’s Super Bowl. In case you’re wondering, SoFi’s main jam is refinancing student loans and personal loans for qualified millennials.

Decentralize All The Things aka DATT, a social network based on blockchain technology, is almost complete. Start the six-month countdown.

When it comes to FinTech, London, Silicon Valley, Hong Kong, and Singapore are the usual suspects, but Mexico and South Africa are right on their heels.

The Virtual Skinny FinTech Ed.: Get Those Paypers…

Posted by The Virtual Skinny on December 21, 2015 in FinTech Edition, Newsletter

12.21.2015

Good to Know: 2015 is on its way out … ICYMI, here’s what FinTech can look forward to in 2016.

THE SKINNY

Thinking In the Alternative…

Tech companies and banks are banding together to build their own version of the blockchain, the underlying technology behind virtual currency bitcoin. The project is called the Open Ledger Project. Think alternatives to the blockchain like the Ripple network.

Tell Us More…

Nonprofit Linux Foundation is overseeing this alternative-blockchain movement. And, IBM, Intel, Cisco, the London Stock Exchange Group, JP Morgan, Wells Fargo, and State Street are in. The goal is to build something similar to the blockchain that will help increase transparency and automation across the business world. Think stock exchanges and financial markets, specifically.

If You Build It, They Will Come …

Yes, improving services in the business world is good and all. But, this move seems to be a lot about control. Currently, the current bitcoin network is decentralized just like the Internet. In other words, no one person or entity can claim the bitcoin network. With the Open Ledger Project, the participating companies can have a say in how the technology is built and operated. Word on the street is companies involved in the project want to ultimately keep this new blockchain-type technology open and non-proprietary.

WHAT ELSE IS GOING ON?

Starting Things Off Right …

In what will be a relatively light week on Wall Street on account of the holidays, things are looking up for tech and the financial sector. Not so much for energy stocks, which are trailing behind.

If It’s Broke, Fix it …

Global nonprofit organization Kiva is re-working its playbook for the U.S. market. The organization’s lending platform, kiva.com, has been a hit in when it comes to helping finance small biz in emerging markets, but it’s not so popular in the U.S. One reason? It’s just easier and cheaper to access capital. So, what’s the new angle? Kiva’s offering what it calls the Kiva Zip platform so small biz owners can bank on their friends and family to help fund their operation. We’re talking – raising $10k with 0% interest and zero fees and terms for three years. Not bad …

By Any Means Necessary …

We all heard about the massive data breach at JP Morgan earlier this year leaving 76 million homes vulnerable. Now, banks are shaking in their boots and are spending racks on racks on racks of cash to secure their systems. They’re also sending fake “phishing” aka “spear phishing” emails internally to see how employees react. Turns out employees are falling for it. In addition to training employees on what to do if they receive “phishing” emails, banks are also doing things like banning employees from using their work email address for play, using “out of office” emails or voicemail message, and from using portable devices like USBs. Anything for security. Speaking of … this year, entities dropped $75.4 million in the cybersecurity market.

THE STREETS ARE TALKIN’

UK mobile wallet app Yoyo has gone stealth mode in the U.S. The mobile wallet is quietly entering the market via a few chosen partners. It hopes to make things official during Q1 2016.

Investors are looking to Israel’s fintech market, which is hot, Hot, HOT! Turns out the country’s progression in cybersecurity makes it ripe for a fintech boom.

First Walmart, now Target. The retailer is getting into the mobile payments biz. Things are all very early stages, and the company says that it’s keeping its options open.

Breaking into the Chinese market. That’s top of the list on Apple and Samsung’s list of New Year resolutions. Both companies are looking to check that off their list with Apple Pay and Samsung Pay by collaborating with UnionPay. Chinese Internet company Alibaba’s already got a strong hold on the market with AliPay so we’ll see how this goes.

The U.S. Securities & Exchange Commission gave the A-OK to Overstock on its plans to use the blockchain to dole out stock.