Friday’s fintech news includes Worldpay research showing relentless growth in UK mobile payments, up 336% since last year. A PwC report predicts banks could lose up to 24% of their revenue to new fintech companies in the next three to five years. SWIFT 
hopes to have real-time settlements in place for US Banks by the end of 2018.
With a market cap of $60 billion, Ant Financial has 520 million customers in China and global ambitions including the US. BBVA-owned virtual bank Simple will lay off 10% of staff and focus on its technology roots. In Canada, CIBC bank will move its two million customers from Loblaw’s Presidents Choice to Simplii Financial and take a 100 million dollar charge.
KeyBank will take equity in Billtrust which increases business cashflow by accelerating electronic invoicing, payments and other processes. Australian mobile money app Spriggy raised $2.5 million in new venture capital. Apple Pay is cutting support for websites selling neo-Nazi and white supremacist products. PayPal moved to block account users from donating to or supporting Neo-Nazi or white supremacist groups with payments.
In Kuala Lumpur, Public Bank Bhd launched Alipay’s mobile payments wallet. In Egypt, startup PayMob hopes to encourage the 91% of consumers who pay cash on delivery for online purchases to move to mobile payments.
Mobile contactless spending accelerating in UK
Mobile tap-and-pay spending is accelerating on the high street, spurred by the growing popularity of contactless payments at the point-of-sale, according to new data from Worldpay. Worldpay transactional data indicates that mobile contactless payments topped £370 million in the first six months of 2017, a whopping 336% year on year rise in spending.
The use of mobile devices to make in-store payments has been growing steadily since the UK launch of Apple Pay in 2015, but according to Worldpay it is only really in the past 12 months that the technology has begun to gain widespread acceptance beyond ‘early adopters,’ further fuelled by the launch of Android Pay in 2016 and Samsung Pay earlier this year. Via finextra.com
What banks should do to overcome fintechs’ head start in payments innovation
Over the past half-decade, fintech companies have gained undeniable momentum by offering cutting-edge payment services that banks haven’t matched or have been historically slow to offer. In fact, PwC’s Global Fintech Report found that banks could lose up to 24% of their revenue to fintech over the next three to five years.
Those unfavorable numbers should be a catalyst for banks investing in and speeding up payments innovation. Problem is, that hasn’t happened in many cases. The good news is that this is a marathon, not a sprint, so banks still have ample opportunity to match fintech in the long race for payments supremacy.
The real lag behind fintech started when banks rested on those online and mobile banking laurels and allowed other players in the mobile space to bypass them in working toward mobile point of sale payment services. Both device manufacturers and mobile network operators seized this opportunity, and a proliferation of mobile wallets or mobile payment apps emerged: Apple Pay, Samsung Pay, Android Pay and more. These apps proved that banks didn’t have a stranglehold on payment services, and the gaping opportunity was soon filled by fintech. Via paymentssource.com
SWIFT to facilitate instant payments in the US
The Clearing House (TCH) is building a new clearing and settlement system to support domestic instant payments in the U.S., allowing consumers and businesses to send and receive payments in real-time and directly from their accounts at financial institutions. It will also include data and non-payment messages that financial institutions can use to build digital commerce solutions.
SWIFT’s solution for the U.S. market will enable banks to leverage a single platform, Alliance Messaging Hub (AMH) for both SWIFT high-value payments and low-value TCH real-time payments. AMH is an orchestration layer that includes a gateway to the TCH RTP network, as well as other gateways and API’s which allow financial institutions to connect to other non-SWIFT networks. Financial institutions can leverage AMH to support instant payments, simplifying adoption to our customers. The solution will be commercially available by early 2018. Via automatedtrader.net
China’s digital-payments giant keeps bank chiefs up at night
One admired boss in the conventional banking industry says Ant keeps him awake at night. For protectionists, the firm is evidence of a Chinese plot to control the world’s financial plumbing. For consumers, it could boost competition in a cosy industry.
Asian firms have leapfrogged ahead, offering a new model of financial technology. Exhibit A is Ant Financial, a payments company affiliated with Alibaba, one of China’s two giant internet firms (the other is Tencent, whose WeChat messaging app is ubiquitous and supports payments). Ant is popular in China and has ambitions outside it. Already the world’s most valuable “fintech” firm, worth $60bn, it has 520m payments customers at home and its affiliates abroad have 112m, mainly in Asia. In May it signed a deal to install its payments system in millions of American retail outlets. Ant is in the process of buying MoneyGram, a Texas-based money-transfer firm active in over 200 countries.
One admired boss in the conventional banking industry says Ant keeps him awake at night. For protectionists, the firm is evidence of a Chinese plot to control the world’s financial plumbing. For consumers, it could boost competition in a cosy industry. Via economist.com
Simple lays off ten percent of staff in bid to return to tech roots
Joshua Reich, the CEO of US digital neo-bank Simple is pledging to return the business to its roots, having spent the past few years “acting like a bank instead of a technology company”. Acquired by Spanish bank BBVA for $117 million in 2014, Simple has since been bogged down in rebuilding its core infrastructure and transferring accounts to new US banking partner BBVA Compass.
The initiative has not always run smoothly, with Simple being forced to write to a number of customers last year advising them that they would have to open new accounts due to logistical problems in transferring their banking details to the new platform. Via finextra.com
CIBC severs ties with President’s Choice; launches new direct banking
Canada’s CIBC is cutting ties with Loblaw groceries President’s Choice Financial and moving its nearly two million accounts to Simplii Financial, a new direct banking brand for clients who want no-fee daily banking through online, mobile and telephone channels The winding down of the 20-year President’s Choice collaborative venture will cost the bank approximately $100 million pre-tax in the current quarter. Loblaw says it will retain its loyalty point programme and credit card offering, while handing over all regular banking services to CIBC.
Banking services at in-store pavilions and ATMs operated by CIBC will be phased out of Loblaw and partner grocery stores between November and March. The brand switch will take effect from the beginning of next month. Via finextra.com
KeyBank takes equity stake in fintech firm Billtrust
KeyBank, in its latest fintech partnership, has announced an equity investment in New Jersey cloud-based payment cycle manager Billtrust.
The collaboration, which helps spur the launch of KeyTotal AR (accounts receivable), affirms the company’s commitments to fintech and the improvement of the payments space.
The platform is powered by Billtrust’s Quantum Payment Cycle Management solution, which accelerates cash flow by automating processes like invoice delivery and payment applications. Billtrust’s Quantum Payment platform, launched in 2016, uses robotic process automation to eliminate repetitive manual tasks in the accounts receivable process. Via crainscleveland.com
Digital pocket money startup Spriggy secures A$2.5 million funding
Spriggy, an Australian startup that has developed a mobile pocket money app and linked card account, has raised a $2.5 million funding round. Founded by two former derivatives traders at Citigroup, Spriggy has already amassed 35,000 customers two years after launching the company with $300,000 in seed funding. Spriggy charges parents a $30 subscription fee per year for each child.
The new financing was led by Alium Capital with additional investments from venture capital group Perle Ventures, and several high-net worth individuals. Former ING Direct Australia CEO Vaughn Richtor, and former Delivery Hero CTO Scott Fletcher also joined Spriggy in advisory roles to help guide the company into its next phase of growth. The firm says the funding will be used to hire more staff and extend outreach marketing activities. Via finextra.com
Apple Pay Is Cutting Off White Supremacists
Apple and PayPal have started to disable payment support from websites selling white nationalist and Nazi apparel following this weekend’s events in Charlottesville.
A screenshot of some the product offerings from vinlandclothing.com, which was banned from using Apple Pay and PayPal for selling Nazi apparel. The most valuable company in the world is taking a stand against websites selling apparel and paraphernalia from white nationalists and hate groups.
On Wednesday, Apple confirmed to BuzzFeed News that it had disabled Apple Pay support for a handful of websites that sold sweaters with Nazi logos, T-shirts emblazoned with the phrase “White Pride,” and a bumper sticker showing a car plowing into stick figure demonstrators. Following Saturday’s Charlottesville demonstrations, where one woman was killed by a car driven by a white nationalist, the iPhone-maker blocked three white nationalist sites from using Apple Pay. Via buzzfeed.com
PayPal escalates the tech industry’s war on white supremacy
PayPal, the popular online payment platform, announced late Tuesday night that it would bar users from accepting donations to promote hate, violence and intolerance after revelations that the company played a key role in raising money for a white supremacist rally that turned deadly.
The company, in a lengthy blog post, outlined its long-standing policy of not allowing its services to be used to accept payments or donations to organizations that advocate racist views. PayPal singled out the Ku Klux Klan, white supremacist groups or Nazi groups — all three of whom were involved in last weekend’s Charlottesville rally.
“Intolerance can take on a range of on-line and off-line forms, across a wide array of content and language,” the company wrote. “It is with this backdrop that PayPal strives to navigate the balance between freedom of expression and open dialogue — and the limiting and closing of sites that accept payments or raise funds to promote hate, violence and intolerance.” Via washingtonpost.com
Public Bank partners Alipay to offer mobile wallet services
The Alipay mobile wallet service is now available at the outlets of Public Bank’s merchants to cater to the needs of Alipay users from China, who frequently travel and shop in Malaysia.
Speaking at the launching ceremony on Tuesday, Alipay South-East Asia general manager Zhang Dayong said that the partnership with Public Bank would enable Alipay payment acceptance at a large base of local merchants.
Via thestar.com.my
Going Cashless: Startup PayMob Wants to Make Egypt (and MENA) Transact From Their Mobile Phones
According to PayFort’s State of Payments 2016 report, 42% of Egyptian consumers shop online, yet 91% of Egyptian shoppers still use cash on delivery as a payment option. It’s not surprising, as the country predominantly has cash-driven businesses, with Harvard Business Review citing that only 10% have access to a bank account, and 94% of financial transactions are conducted in cash. In a cash-dominated society, financial inclusion is essential for individuals, enterprises, and economies alike to prevent hurdles to progress- and this is the opportunity that PayMob is trying to tackle.
The startup is an electronics payments solutions provider converting cash payments to electronic, using existing payment channels such as credit card, mobile wallet and cash. Based in Egypt, the fintech startup is co-founded by CEO Islam Shawky, COO Alain El-Hajj, and CTO Mostafa Menessy.
Given Egypt’s reliance on cash, El-Hajj says that its economy is at risk to lose money through cash-based fraud, theft, costly insurance, as well as from the time-consuming task of counting and reconciling cash balances- and digital payments can definitely help reduce this kind of waste. Shawky also points out that the focus on cash excludes people from the financial system and its benefits, and PayMob can help turn that around, saying, “We’re working on empowering the masses with tools to perform digital transactions, and get access to financial services using their mobile phones.” Via entrepreneur.com
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