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  • Fri, August 17, 2018 12:37 AM | Deleted user

    GreenSky Inc. recently announced a partnership with American Express to offer alternative payment solutions to merchants and consumers. The companies aim to join American Express's large customer base with GreenSky's ability to offer point-of-sale financing options. The partnership would allow customers to finance large purchases without creating a large paper trail, making the interaction much more like a typical point-of-purchase sale.

    This comes on the heels of American Express's "Plan It" feature, which allows cardholders to select individual purchases to be paid back in installments. Unlike this new partnership, Plan It doesn't charge users interest; rather, it charges a fee based on the length of the payment plan selected. Currently, only purchases of $100 or more are available through the Plan It program. The option is only available to American Express cardholders.

    While some consumers view their credit card purchases as small-scale loans—borrowed money from a credit card company used to make a convenient payment in the present—the partnership between American Express and GreenSky hints that a new, alternative model may be in the works. This model would provide something much closer to a point-of-sale purchase, a transaction with which most Americans are familiar. That means consumers can expect financing in the future to feel much more like the swiping of a credit card—and it may be harder to tell the difference from the surface level as financing becomes more electronic and more convenient.

    With GreenSky's current technology, customers can apply for installment-based loan financing on a mobile app and sometimes receive approval within as little as 60 seconds. Because GreenSky uses proprietary technology to make this possible, American Express's partnership with GreenSky hints at an exclusive feature that may only be available to American Express customers in the future.

    American Express customers might expect more available point-of-sale financing for larger purchases, making it easier to borrow money for items like furniture, healthcare and other products that sometimes require small-scale loans. Although this partnership could disproportionately affect those who frequently fund purchases through financing, it may also hint at a burgeoning method of payment at stores that offer high-cost items.

    Americans typically have to look for financing options in order to secure larger purchases, such as mattresses, healthcare and home equipment. As The Economist notes, "point-of-sale loans" are growing increasingly popular as a source of funding for Americans who want to secure these purchases.

    Paying for large purchases through financing makes it possible for everyday consumers to make large purchases—so long as they have a plan in place to handle the payment terms. In the same way that consumers today can shop around for a different credit card, more financing options at the register may mean consumers might also be able to shop through available lenders in order to secure the best financing terms possible. As always, new financial products can enhance competition in the marketplace and drive financing terms lower, ultimately benefiting the consumer.

    About the Author

    Joe Resendiz is a Research Analyst at Value Penguin, focusing on credit cards and the payments industry. He previously specialized in public sector and infrastructure financing at Goldman Sachs.

    Source: https://www.valuepenguin.com/news/american-express-partners-greensky-alternative-payments-and-financing

  • Fri, August 10, 2018 3:59 AM | Deleted user

    The future of fintechs is not world domination – despite the advent of open banking, non-bank ecosystems, platform economics or superior customer focus.

    Rather those fintechs which emerge from the frenetic, fertile environment of venture funding and brilliant ideas with a true business case will either partner with established players or be taken over.

    It’s an endgame which has been emerging for some years although often missed in the headline-drawing epic tales of empires crumbling under a rebel onslaught.

    The truly interesting twist is whether those established players will be traditional or non-traditional – banks or platforms, Citibank or Alibaba, Lloyds or Facebook.



    The latest douse of, at best, tepid water came from Australia’s Productivity Commission in its report Competition in the Australian Financial System.

    "The truly interesting twist is whether those established players will be traditional or non-traditional.”

    “Fintechs are not, on present indications, likely to have the kind of competitive disruptive effect that would alter the market power of major banks in the foreseeable future,” the PC found.

    “In the long term, lowering barriers to entry and growth, including greater access to consumer data, may lead fintechs to favour competition against incumbents over collaboration.”

    The commission added gnomically we “must look further afield for substantial offsets to current market power.”

    Bigger waves

    While global technology companies have been creating bigger waves internationally the PC acknowledged it was not the case in Australia.

    The best overall snapshot of where fintech is at is the biannual KPMG Pulse of Fintech report, the latest edition of which finds overall global fintech investment “roared ahead at a record pace” in the first half of 2018, reaching $US57 billion.

    For Australia the key stat was not as loud but still a rise to $US63.7 million from $US56 million in the first half of 2017 – albeit lower than the second half of 2015 and the first half of 2016.

    KPMG noted much of the investment in Australia was concentrated across a small number of deals – just seven compared with 12 in the second half of 2017 and 16 in the first half of 2017.

    "Significant outliers still dominate the Australian fintech ecosystem, propelling the majority of this growth, such as the Rubik Financial deal in the past and, most recently, the acquisition of financial data analytics provider Hometrack Australia for roughly $US97 million by REA Group," according to KPMG.

    There was a similar concentration in deal numbers globally with the two biggest being the record-setting $US14 billion raise by Ant Financial in the second quarter of 2018 and Vantiv’s acquisition of WorldPay for $US12.9 billion in the first quarter.

    While the overall prognosis for fintech remains healthy, particularly around blockchain, there is not the preternatural energy and growth the hype might suggest.

    As veteran financial services entrepreneur and fintech analyst Grant Halverson of McLean Roche notes “you know fintech is in trouble when four real estate startups raise almost as much money as the entire Fintech sector”. He was referring to the $US8 billion raised by WeWork, Opendoor and Compass.

    KPMG Australia’s Head of Banking and Global Co-lead for Fintech Ian Pollari is more sanguine: "With a significant amount of capital waiting to be deployed, a growing diversity of fintechs hubs across the globe and more corporates looking to seize on larger M&A opportunities, investment in fintech is expected to remain strong heading into the second half of 2018.”


    Not so much

    Pollari noted growth could be expected in individual technologies like artificial intelligence and sectors like regulatory technology (regtech) but “we will also see efforts to combine fintech capabilities and to embed them within broader service offerings, through different commercial structures, particularly in areas such as open banking and digital mortgages”.

    That is, not so much a fintech revolution but an incorporation into existing structures and institutions.

    The question is whether those incumbents will be the traditional banks or pure platforms like Alphabet, Google's parent.


    ANT Financial, an offshoot of Chinese platform giant Alibaba, is just as interesting. Technically it is a fintech startup – albeit one coming out of the stable of Jack Ma.

    One recent report noted Ant handled “more payments last year than Mastercard, controls the world’s largest money market fund and has made loans to tens of millions of people. Its online payments platform completed more than $US8 trillion of transactions last year, the equivalent of more than twice Germany’s gross domestic product”.

    Ma’s Alibaba empire already includes a massive payments business, AliPay.

    According to digital banking authority Chris Skinner, the average employee of AliPay generates $US16 million per year of revenue. An average Barclays employee? $US400,000 a year.

    In Skinner’s view, this is the difference between a tech company getting into finance and a financial company getting into technology.

    “The aim of AliPay is to have two billion users by 2025,” he told New Zealand’s National Business Review. “There are only 1.2 billion people in China, so the rest will come from all over the world. AliPay is already on its fifth-generation architecture. That means every three or four years it throws away its system and starts again from scratch.”

    The critical nuance is that between revolutionary technology – which fintech startups are generating at great pace – and an actual revolution.

    What Google and Alibaba have is scale – even greater scale than major banks. What they don’t have is the security imprimatur of being regulated by financial services authorities. That’s good when it comes to being a revolutionary, bad when the state recognises your importance to the economy.

    Chinese authorities are already taking actions to rein in Ant. Other platforms have been carefully structuring their operations to stay outside the regulatory tent.

    So one possibility is the platform giants seize the market from traditional players. The other is they become “traditional” players themselves and accept the regulation that comes with it. Meanwhile, the traditional players do what Amazon does and buy in fintech revolutionaries.

    This is the future Australia’s Productivity Commission foresees.

    “This overall trend towards collaboration between fintechs and incumbents may improve efficiency of operations and reduce transaction costs for both fintechs and incumbents,” the PC reports. “It could also result in a greater range of consumer-oriented products which are complementary to those on offer by incumbents.”

    “But such collaboration would also likely reduce the potential for these new entrants to be a source of competition.”

    Andrew Cornell is managing editor at bluenotes

    Source: https://bluenotes.anz.com/posts/2018/08/fintech--live--die--repeat

  • Fri, August 10, 2018 3:36 AM | Deleted user

    The last few years have been heralded as a golden age for fintech. Making payments has never been easier or faster, except, when it comes to international payments.

    There have of course been huge successes, such as card schemes and SWIFT payments, which fundamentally changed the transferring of international capital. Most recently we had the rise of the money transfer operators, who had the scale to manage huge international cash flows across borders.

    MTOs created their own model, breaking out of the traditional constraints that had been a drag on small payments for consumers, families and small companies and seeking alternative ways to move money across borders.

    However, the fact remains that the vast majority of international payments are still done via banks and through the correspondent (SWIFT) network.

    While some moves (and many promises) have been made to make international payments more efficient and cost-effective, stricter legislation after the 2008 financial crash plus greater controls to combat international terrorist funding have created challenges for new initiatives.

    These also provide additional costs and risks to banks worldwide, and many have responded by "de-risking," scaling back their operations and networks to remove risk and reduce overheads of meeting regulatory expectations. Banking availability to some countries has been abandoned altogether.

    The World Bank Group’s International Finance Corp. published new data in 2017 stating that 27% of 300 global banks surveyed across 92 countries reported a drop in the number of correspondent banking relationships they have.

    Today, simply, banks are providing access to fewer cross-border routes. The drivers for initiatives to improve the availability and quality of cross-border payment services are ever more apparent; we in the industry need to increase supply (and thus demand), enhance infrastructure and bring about a new model that makes international payments as easy as domestic ones.

    Initiatives to meet the money transfer needs of today’s customer include open banking regulations in the EU, U.K., Australia etc.; APIs, proprietorial technologies, mobile payments, wallets and tokenization; and partnerships and the formation of new players. These initiatives herald a new era in global payments.

    We realize that technology by itself is not the solution, but client centricity, transparency, collaboration, and the removal of technical and nontechnical barriers reign supreme.

    The customer of tomorrow is demanding a new system today, and rightly so. Our global connected world demands ease of use, efficiency, speed, safety and security as vital core functions. It is up to the international payments sector to create modern balanced models that work for everyone, and to achieve this, the partnerships are key.

    We must work together, and not against each other as players within this market, seeking opportunities where our strengths complement each other.

    Source: https://www.paymentssource.com/opinion/cross-border-payments-sill-have-room-for-tech-improvements

  • Fri, August 10, 2018 3:10 AM | Deleted user

    The Consumer Financial Protection Bureau is joining a cooperative of global regulators intended to bring more international collaboration to the regulation of fintech firms.

    The bureau on Tuesday announced the creation of the Global Financial Innovation Network for regulators to discuss joint policy work and offer a cross-border product testing process for innovation-focused companies.

    "The network will seek to provide a more efficient way for innovative firms to interact with regulators, helping them navigate between countries as they look to scale new ideas," the CFPB said in a press release. "It will also create a new framework for cooperation between financial services regulators on innovation-related topics."

    The CFPB said is it working in collaboration with 11 financial regulators and "related organizations." It is the only U.S. regulator involved in the network so far.

    The CFPB released the network's 21-page consultation document as the group seeks input on its mission statement, proposed functions and where the network should prioritize its work. The CFPB said "interested parties" in the U.S. can provide feedback to the agency's Office of Innovation.

    “We look forward to working closely with other regulatory authorities — whether in the United States or abroad — to facilitate innovation and promote regulatory best practices in consumer financial services,” acting CFPB Director Mick Mulvaney said in the press release. “Joining the Global Financial Innovation Network demonstrates the Bureau’s commitment to promoting innovation by coordinating with state, federal and international regulators.”

    The idea for the creation of a global network emerged after the United Kingdom's Financial Conduct Authority, one of the group's members, released a white paper in February describing a so-called "regulatory sandbox" in the U.K. A key goal identified by regulators is to more quickly bring new technologies and products to markets but with an adequate regulatory regime to monitor risks.

    A key focus of the global network would be the creation of an application process for cross-border testing.

    Emerging technologies and services with cross-border applications include artificial intelligence, distributed ledger technology, data protection, regulation of securities and Initial Coin Offerings, and know-your-customer and anti-money-laundering technologies.

    The CFPB said the global network's working group will engage with interested parties across different jurisdictions in the next two months. The group wants feedback by Oct. 14. The CFPB said commenters "should be aware" that comments submitted to the CFPB may be subject to release under the Freedom of Information Act.

    In addition to the CFPB and FCA, the working group includes the Abu Dhabi Global Markets; Autorité des marchés financiers, in Québec; Australian Securities & Investments Commission; Central Bank of Bahrain; Dubai Financial Services Authority; Guernsey Financial Services Commission, in the Channel Islands; Hong Kong Monetary Authority; Monetary Authority of Singapore; Ontario Securities Commission; and Consultative Group to Assist the Poor, a Washington, D.C.-based group that seeks to advance financial inclusion.

    Source: https://www.americanbanker.com/news/cfpb-to-collaborate-on-fintech-issues-with-foreign-regulators

  • Fri, August 03, 2018 6:36 AM | Deleted user

    Contactless payments will exceed the $1 trillion mark for the first time in 2018, a year earlier than expected, according Juniper Research. In 2020, in-store contactless payments will reach $2 trillion, or 15 percent of all point-of-sale transactions, the fintech and payments research firm said in a press release.

    Of the $2 trillion, 15 percent, or $3 billion, will be enabled by OEM payment wallets from providers such as Apple, Samsung and Google according to the new Juniper report, Contactless Payments: Payment Cards, OEM Pay & Mobile Wallets 2018–2023.

    Contactless transactions via card will continue to dominate, driven by strong adoption in Europe, China and the Far East, Juniper said. Already, contactless card payments are the strongest across the China and the Far East and Asia Pacific regions, according to Juniper. Together, those markets account for nearly 55 percent of global contactless card transaction values.

    The mobile contactless payments market will be driven by Apple Pay, Samsung Pay, Google Pay and other OEM Pay wallets. Combined, these OEM Pay wallets users will reach 450 million in number by 2020, with Apple accounting for 1 in 2 OEM Pay users globally.

    Beyond in-store payments, the research forecasts rapid growth in contactless ticketing, especially in European and North American markets where mobile wallets have been deployed.

    Juniper forecasts nearly 10 billion mobile contactless tickets purchased and validated by 2022, with North America dominating the sector, followed by the Far East and China.

    "We believe that growth over the next 5 years will continue to be dominated by offerings from the major OEM players," research author Nitin Bhas said in the release. "Additionally, we now have the likes of Huawei Pay and Fitbit Pay launching in several markets; this is now included in Juniper's contactless forecasts."

    Source: https://www.mobilepaymentstoday.com/news/study-apple-pay-to-lead-contactless-payments-surge-among-mobile-wallets/

  • Fri, August 03, 2018 6:20 AM | Deleted user

    Famous French poet, Victor Hugo (26 February 1802 – 22 May 1885) suggested many years ago that "there is one thing stronger than all the armies in the world", and that is an idea whose time has come. In other words, nothing can stop an idea whose time has come.

    Just as in many evolutions, disruptions, and paradigms, the last decade has brought us digital payments, and nothing can stop its invasion of our transaction spaces. For the many detractors, or let me say laggards, even with legitimate reasons not to adopt digital payment, it won't be long that they will have no alternatives than to utilise digital channels to transact life’s everyday business.

    The numbers are there to prove it. According to Bank of Ghana, the value of mobile money transactions as at the 1st quarter of 2018 alone was over 52.35 billion cedis from, about 312 million volume of transactions across three telecommunication networks, MTN the leader, Vodafone, and AirtelTigo.

    Obviously, there is a wave of digital payment adoption in Ghana and increasingly, the emergence of Fintechs and the platforms that are being offered by these fintechs in the value of the transactions stream are playing a major role in the rise of digital payments. By the end of the next decade or before, we are going to see total adoption of digital payments by all segments of our society.

    It is refreshing to see a lot of businesses in Ghana adopting mobile payments, especially mobile money. From corner shops to supermarkets, to restaurants, to corporates, to hospitals, to transport services and all major transaction points, the country is seeing a viral adoption and adaptation towards mobile payments.

    This makes the realisation of a cashless society a soon-to-be certainty. Contrary to views of some people who see a cashless society as a longshot so prefer to use the term cashlight, I for one don't see a reason why transactions in Ghana and across the world can't be dominantly cashless. Here is the caveat though, cashless does not mean the death of cash. What is happening is natural selection towards more experiential alternatives of making payments through channels such as cards, virtual currencies, and digital wallets.

    Digital payment methods improve the lives of people. Digital payments provide people with better transactional experiences such as frictionless-ness, convenience, transactions visibility, and security. Through the expansion of digital payments, we drive financial inclusion. Majorly, there is an infinite possibility in transactional innovation which attracts different strata of our society to the transactional economy.

    This phenomenon increases the number of persons within the transactional ecosystem that can access and benefit from the financial system. With digital payments, people and businesses are able to tell better and more accurate financial stories of their everyday activities.

    Knowing the tremendous benefits we derive from digital payments, why are churches delaying in making digital payments a mainstream dynamic in their mobilisation of money? Also, why are people vilifying churches who have seen the light and utilising digital payments to broaden financial participation in their activities? Churches have played a vital role in the development of Ghana communities. Without mentioning names, the physical evidence of churches’ role in our national development are there for all to see.

    Over the years, churches have been instrumental in developing education in Ghana by building schools right down from primary to the tertiary levels. Churches have given scholarships, built health institutions, provided accommodation, created farms and contributed immensely to social progress in Ghana through various welfare initiatives. Most of these things are done with money from members and external donors through very tactical fundraising mechanisms.

    The reality though is, churches still need money to sustain all these activities and drive new initiatives. In the pursuit of financial sustainability, the fundraising tactics of the churches have to change. It’s time churches consider and adopt digital payments and push greater financial participation in their churches’ activities. Digital Payment is a fast evolving paradigm and churches who fail to steer their financial management strategy in a digital direction are bound to fail. Without adopting digital payments, churches risk limiting their ability to raise funds for their projects and other social responsibilities.

    Considering more and more people are carrying less physical cash every day, and even on weekends, churches have to provide channels that can enable such people to continue to contribute to church activities. With digital payments, churches increase their reach and sources of financial inflows for their activities and initiatives. Churches can use digital payment platforms through crowdfunding to collect micro-contributions from a large and distributed donor base. Digital payments offer much ubiquity, so geographical boundaries are no more inhibitions for raising needed funds for church initiatives.

    Digital payments are predominantly channelled agnostic and can permeate a plethora of moments. For example, an inability to attend church services would not mean an inability to participate virtually or financially in church activities. People can follow sermons and church activities via digital media and make financial contributions at different moments during the service. Adopting digital payments means, church projects and initiatives would be finished faster to the benefit of members and in many cases reduce the dependence of churches on bank loans.

    Another great benefit churches derive from adopting digital payments is they have access to critical data that they can utilise to make strategic decisions that have a positive impact on the physical church, its members and the society at large. Additionally, there is greater transparency with the adoption of digital payments, as financial reporting is instant, trackable, easily auditable, dynamic and highly visualisable.

    Churches abound with impact-driven initiatives and activities that require funding. Digital payments provide the capability for tactical targeting and natural segmentation of such initiatives for funds mobilisation.

    There are many payment platforms that Churches can take advantage of to power their digital payments strategies. These platforms also charge nominal transaction fees that they use to maintain and sustain their platform operations. Most of these platforms have the capability to offer collectively or separately, payment rails such as Visa, MasterCard, and Mobile Money.

    Some of these fintechs can tailor the capabilities and features of the digital payment platforms to the needs of the church. For example, churches can be given their personalised USSD payment codes that work on all mobile devices, web links they can share, specialised payment buttons that they can make available on their websites and visibility in the payment apps of the providers.

    In the past weeks, ICGC has made it possible and easy for their members to participate financially in church activities through digital payments. They have enabled their members to use platforms like Slydepay, Expresspay and Ecobank Pay to make payments to the church. This laudable initiative has raised many eyebrows and gotten the unjustifiable church backlash from some groups of people on social media.

    I find it somewhat bemusing, enstranging and shocking that in this digital era where we are seeing everywhere around the world a quest for greater digital transformation, some sections of Ghanaian society will take issue with a church adopting digital payments. I firmly believe this is the time for all of us Ghanaians to embrace the new payment paradigm of digital payments.

    I entreat all churches to follow ICGC, Perez Chapel and the few other churches who have taken the lead in transforming financial participation in the Body of Christ. Globally, churches are increasingly moving towards digital payments for the offertory, tithes, and other donations. Ghana-based churches cannot lag behind. All churches should do away with the offering bowl and broaden financial participation by making payments digital.

    About the Writer:

    Derrydean Dadzie, is an Accomplished Business Leader, Tech Entrepreneur, and Finch Tech Expert.

    Source: https://www.myjoyonline.com/opinion/2018/august-2nd/lets-do-away-with-offering-bowls-its-time-for-digital-payments.php

  • Mon, July 30, 2018 4:06 AM | Deleted user

    The 2018 Consensus conference in New York was packed with numerous DLT insiders. But outside, Genesis Mining created a spectacle by staging a protest by “Bankers Against Bitcoin,” a group they helped create and support.

    There is no word yet about who these “bankers” were, or whether they were paid to protest the conference with slogans like “paper checks use less electricity” and “we opened all those accounts by accident.”

    The latter likely refers to the scandal that still plagues Wells Fargo, wherein Warren Buffett’s favorite US banking investment opened up millions of unauthorized accounts that fleeced their unwitting clients.

    Despite the comical nature of the ‘protest,’ the ideas that Genesis was shining a light on are worth consideration. One sign at the stunt claimed that charging a 19% fee to send money to Mexico from the US was totally justified. A transaction like this is extremely simple to do and has basically no risk attached to it.

    Why banks charge so much to do simple bookkeeping is unknown, but it does create a huge opportunity for competition.

    Moving Numbers

    There was a time when international money transfers were difficult, but in a world of centrally settled fiat currency transactions between money center banks, we are now really just looking at moving around numbers on a ledger. Fiat currency doesn’t have any physicality, nor does it have any sort of anchor in reality.

    A situation like this is wonderful for the banking system, given their near monopoly status and hand-in-glove relationship with major governments. Unfortunately for the banks, people seem to be waking up to how the financial system is organized, and looking for new ways to settle transactions.

    DLT-based systems, like Bitcoin, are probably the forerunner of a very new global transactional system, where people have far more control over how they can trade with one another. The actual costs involved with moving numbers around the world is very small, especially given how developed our communication systems have become.

    They May Be Missing ‘It”

    The single largest shareholder of the very same Wells Fargo that committed massive fraud is none other than Berkshire Hathaway. In an annual meeting earlier this year, the CEO of Berkshire Hathaway, Warren Buffett, said that Wells Fargo’s woes aren’t different than any other company.

    Massive fraud that is perpetrated with the goal of profiting from trusting customers does nothing to give people any sort of confidence in their banking system. Warren Buffett recently said that bitcoin is “rat poison squared,” while his top lieutenant Charlie Munger compared it to bodily waste.

    Bitcoin is neither, and unlike the kind of companies that Warren Buffet chooses to invest in, DLT technology empowers free trade and secure transactions.

    For an idea that is around a decade old, blockchain has already made a huge impact on people all over the world. As time goes on, it will likely show the existing financial system why innovation is so important.

    Source: https://cryptodisrupt.com/bankers-against-bitcoin-protest-shows-how-innovation-threatens-major-banks/

  • Mon, July 30, 2018 3:26 AM | Deleted user

    Hitachi announced yesterday the launch of a new system that utilizes blockchain technology to make fingerprint payments.

    Working in collaboration with Japanese telecommunications company KDDI, Hitachi has integrated a Hyperledger Fabric blockchain platform into its biometric verification hardware that links to a KDDI payment platform.

    The KDDI Corporation was formed in October 2000 as a merger of three Japanese telecommunications businesses. In 2014 the company announced a partnership with Google to build a 60Tbit/s undersea data transmission cable connecting Japan to the United States.

    Hassle-free fingerprint payments

    With the new Hitachi and KDDI system, customers will be able to settle payments with just their fingerprint. The system is designed to work with KDDI’s existing coupon payments facility and will initially be trialed at a KDDI store in Tokyo.

    Users will be required to sign up to the platform by registering their coupon details and biometric data which will then be encrypted and securely stored on Hitachi’s integrated blockchain network. Once registered, a users identity is verified by a fingerprint reader at the retailer which then links to the blockchain network and completes the transaction via KDDI’s coupon settlement platform.

    Hitachi hopes to develop the system into a highly secure, decentralized and tamper-proof payments facility that can be instantly updated and shared amongst all participating retailers.

    Fingerprint payments are a relatively new concept, but Hitachi has been working with the technology for a while. In October 2016, Hitachi developed a system that uses a normal smartphone camera to successfully scan and verify fingerprints. Unlike normal fingerprint scanners that utilize infrared sensors to read fingerprints, the Hitachi system scans vein patterns in the user’s finger.

    The new fingerprints payments system will also be tested by a donut store in Tokyo’s Shinjuku district. Each store using the system becomes a node on the Hitachi blockchain network.

    Increasing interest in blockchain verification

    Hitachi, along with several other electronics corporations, has been more actively exploring the verification benefits of blockchain recently. In September last year, the company partnered with Mizuho Financial Group to develop a supply chain management system that uses blockchain to create a secure and easily accessible ledger of all order-related data.

    Fingerprint scanning technology is just one of many identification systems that have found increased benefits through integration with a blockchain network. Facial recognition and retinal scanners can also be paired with blockchain to provide similar solutions.

    The benefits of identity verification via blockchain is also becoming increasingly recognized for its humanitarian applications. A recent system has been proposed to securely store details of victims of the African refugee crisis. If successful, the system could change the lives of millions of displaced citizens.

    Source: https://cryptodisrupt.com/fingerprint-payments-using-blockchain-tested-by-hitachi/?cn-reloaded=1

  • Sat, July 21, 2018 4:19 AM | Deleted user

    In the aftermath of global privacy breaches like Equifax and Facebook, banks and financial technology companies are rethinking their approach to data security. As consumers increasingly express concern over how enterprises are handling their personal information, banks find themselves having to comply with two European regulations — or risk paying a hefty fine.

    While most organizations are aware of the General Data Protection Regulation (GDPR), financial institutions also have to concern themselves with the updated Payment Services Directive (PSD2). Designed to improve competition and innovation within the EU markets for payment services, the PSD2 requires third-party providers to gain explicit consent from customers before accessing their payment account data. Although the PSD2 shares several commonalities with GDPR, the two regulations differ just enough to make it important for financial institutions to double check they remain compliant with both.

    PSD2 vs. GDPR — Are they really that different?

    First proposed by the European Council in 2013, the Payment Services Directive was revised several years later to enhance consumer protections and to promote innovation within the payment services industry. This directive is exclusive to the financial industry that must be transposed to national regulations, and is set to regulate new forms of payments through the opening of banks’ APIs to third parties. EU member states had until January 2018 to implement the PSD2 into national laws, which includes key updates such as:

    • Requiring banks to grant access to third-party payment service providers
    • Leveling the playing field for all payment service providers by encouraging competition
    • Strengthening consumer protections by increasing transparency, efficiency and security of retail payments

    On the other hand, the GDPR is a regulation that is applicable in its entirety to every member state in the EU, without local interpretation. The GDPR, which went into effect on May 25, 2018, controls access to European consumer data and banks must comply to avoid massive fines. The GDPR also states consumers must give consent to banks to use their data and have the right to be forgotten, and any breaches of personal information must be reported within 72 hours to the consumer and the authorities.

    Another area where PSD2 and GDPR differ is how each defines ‘personal data.’ Because PSD2 is localized, it’s up to the discretion of individual member states to define personal data. GDPR, however, defines what could be considered sensitive information and does not refer to the updated payment directive at all. For the payments industry specifically, the introduction of both GDPR and PSD2 will slow the rate of innovation as banks and financial organizations focus on strengthening user security.

    How financial institutions can navigate the complex regulatory landscape

    As regulations tighten around data privacy, banks and other financial enterprises must approach PSD2 preparation with GDPR regulations top of mind.

    One way banks can remain compliant is to implement privacy by design. In other words, financial organizations can build privacy into the design and management of a given system or process. Banks can set up rules and policies for data breaches, develop a culture built around security and improve the onboarding process for third-party providers (TPP). Rethinking onboarding processes is especially important as open banking and real-time payment processing becomes more widespread.

    Other best practices, like appointing a data protection officer (DPO) and reviewing consent management processes, will help those in the payments space uphold the highest level of data security. In the interest of transparency, banks should also prepare clear, easy to understand privacy notices before citizens start requesting access to their data. With customer consent the focal point of both GDPR and PSD2, banks and TPPs will want to develop robust authentication programs to better prevent identity fraud.

    When in doubt, financial institutions should default to the principle of least privilege (PoLP). For banks, this means looking for the lowest common denominator and granting the least amount of privilege as absolutely necessary. If GDPR clearly defines ‘personal data’ but PSD2 does not, for example, then banks must adhere to the definition as stated by GDPR. Until further guidance is provided from the EU on how to reconcile the differences between GDPR and PSD2, financial institutions must be ready to meet the requirements of both.

    For banks and financial organizations, the time to respond to GDPR and PSD2 expectations is now. As data privacy laws tighten and consumers grow increasingly aware of who is handling their personal information, banks will find it worth their while to revisit the way they manage data and prioritize building a culture of security.

    Source: http://paymentsjournal.com/payments-industry-gdpr-psd2/

  • Thu, July 19, 2018 3:12 AM | Deleted user

    Speaking during the ongoing Crypto and fintech conference MoneyConf in Dublin, Ireland, Jeremy Allaire, Co-Founder & CEO of payments company Circle, said that the world is in its nascent stage of “tokenizing everything”.

    Allaire was giving his speech about the crypto revolution in the morning session when he made the remarks. He likened blockchain to the early days of the Internet, which transformed the data and communication sectors. Allaire now sees blockchain as being poised to revolutionize the entire finance sector and alter public and civil services as they are perceived today. Allaire explained,

    Once you have an open global immutable record-keeping system, transaction-processing system and a secure computing environment, you can re-conceptualize on a global basis every aspect of finance, corporate and commercial law, the intermediation of contracts, and crucially all of the systems we use in both corporate and civic decision making.

    The CEO gave an outline of a tokenized global economy and society where almost all forms of value storage and public record become crypto tokens that have a free floating market value and are traded on global digital exchange platforms. He explained:

    With crypto-assets, you can tokenize your house, car or art, and establish open global financial relationships around any physical property.

    The CEO also vouched for blockchain’s ability to enhance social governance and transparency. He said that the tokenization of private or public votes in all forms of social governance would offer an immutable system that is more transparent and accountable than current models.

    Allaire suggested five categories of crypto-assets, beginning with privacy-focused cryptocurrencies, which remove financial activities from the centralized control of governments and serve as a public good on the Internet.

    These so-called crypto-securities, Allaire said, can serve to represent rule-based financial contracts and have a potential that goes far beyond a paper contract mediated by a law firm in a court of law. He emphasized that a lot of ICOs fall under this category.

    He then addressed crypto-assets that support transaction settlement systems, such as Ripple (XRP) and Stellar (XLM), as well as very ambitious blockchain-based platforms such as Ethereum (ETH), which he characterized as operating systems for the global economy.

    Allaire’s last category of crypto-assets were fiat-backed stable coins, designed for financial contracts. Allaire emphasized their potential for use cases that require a less volatile price baseline, but still seek the decentralization and security of blockchain.

    According to Cointelegraph last month, Circle closed a $110 mln fundraising round led by mining hardware manufacturer Bitmain to partner on the development of a US dollar-backed stable coin. Circle’s USDC will be an ERC-20 token based on the Ethereum network, and will reportedly be released by Circle in the summer. The investment brought Circle’s valuation to nearly $3 bln, an almost sixfold increase since 2016.

    Source: https://bitrazzi.com/the-world-is-at-the-start-of-tokenization-of-everything-says-circle-ceo/

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