Welcome to Friday fintech news with the latest developments in payments, new technology and innovations from around the globe. The new PayPal/Apple payments partnership helped PayPal shares reach an all-time high on Wednesday. Apple Pay added another 20 financial institutions in the US and EU. It also plans to introduce P2P payments with the new iOS 11.
Visa launched its Visa Cashless Challenge, hoping to encourage digital payments which its research says could see businesses in New York City save as many as 186 million man-hours and generate $6.8 billion in new revenue. New research by Viewpost shows Americans are ready for digital payments with 11% expecting to continue to receive paper bills but 54% expecting to use mobile payments in the near future.
CNBC Mad Money host Jim Cramer says the $9.4 billion Worldpay/Vantiv deal deserves closer scrutiny by investors. Seven EU banks, including Deutsche Bank, HSBC and KBC, are testing IBM’s new trade finance blockchain technology. Fintech Revolut raised $66 million in new financing in order to continue its growth from mobile payments app to full financial services provider.
Despite larger competitors and heavy competition, Google is ready to launch its mobile payments services in India to capitalize on the growing industry. Online marketplace Snapdeal wants bigger competitor Flipkart to pay up to $900 million to complete the long-awaited buyout.
Tencent is working to bring WeChat Pay to Malaysia where it already has 95% smartphone penetration for its messaging app. Egypt’s fintech startup PayMob launched a new payments service for Middle East small businesses to accept payments off-line and online. E-commerce in the Middle East is expected to grow to $20 billion by 2020.
PayPal shares hit all-time high on Apple deal
Shares of PayPal hit an all time high of $56.99 on Wednesday thanks to a new company partnership with Apple.
PayPal announced early Wednesday that iPhone and iPad users can now use PayPal to make purchases in the iTunes App Store.
The deal will help PayPal generate new revenue and attract customers who might still be wary of adding credit or debit cards to iTunes. Shares of PayPal have traded as low as $36.28 over the past 52-weeks. It closed on Tuesday at $54.94. Via cnbc.com
Apple Pay’s expansion effort shows no sign of slowing down
Apple Pay continues to expand its global footprint, with more than 20 financial institutions across the US and Europe adding support for the mobile wallet, according to Apple Insider.
This gives more consumers access to Apple’s mobile wallet technology, and could very well be an attempt by the company to corner the peer-to-peer (P2P) payment market ahead of the highly anticipated fall release of iOS 11, the newest version of Apple’s mobile operating system.
With iOS 11, Apple will introduce a new P2P payment feature that’s attached to Apple Pay. Users will be able to send funds to friends and family directly from iMessage, Apple’s messaging app. To do this, users will have to load a credit or debit card into Apple Wallet, which houses Apple Pay, according to Fortune; this implies that the offering will likely be enabled by any issuer partnered with Apple Pay. Via businessinsider.com
Visa wants small businesses to stop using cash
For years, mom-and-pop shops and food trucks alike have shuddered at the expense of credit card transactions. It’s not uncommon, for example, for small businesses to have minimum dollar amounts for card purchases. Some still don’t accept them at all or gently inform customers they prefer cash.
Credit-card behemoth Visa launched a campaign to change that Wednesday. The campaign to go cashless — or the Visa Cashless Challenge — aims to create a culture in which cash is no longer king, Visa said.
As consumers increasingly demand ease and security in their shopping, cash-only businesses face challenges as digital payments become the consumer’s choice. And, according to a Visa-conducted study, it might become profitable. According to the report, businesses in New York City could save more than 186 million hours in labor and generate an additional $6.8 billion in revenue by going cashless. Via denverpost.com
Americans Want Paper Checks to Die
Cash is garnering less interest among American consumers, who are excited about mobile payments. That’s according to a new survey from Viewpost, which polled 1,000 consumers in the U.S.
According to a news report covering the results of the survey, greater than half of Americans polled said payments between consumers and businesses will be done largely via mobile payment apps in the future. Of the survey respondents, 11 percent said they think companies will continue to bill them via paper checks in the future, while 54 percent think they will get bills via automatic online payments from their bank account or credit card.
“People are willing to embrace a more convenient, frictionless payments future,” Viewpost CEO Max Eliscu said in a released statement covered by the report. “Paper invoicing and checks are well on their way out in the consumer setting, and more businesses across the spectrum are beginning to follow suit with transactions among their trading partners. But electronic invoicing and payments are just the beginning — the future of the payments industry is highly dependent on leveraging innovation like biometrics, data integration and a growing variety of payment methods to securely drive more volume with visibility, speed and simplicity.” Via pymnts.com
Cramer’s take on the $9.94 billion Vantiv-Worldpay merger
If it is not as big as the Amazon-Whole Foods deal, it is ignored. Jim Cramer has grown tired of this pattern when it comes to mergers, which are already so sparse in today’s stock market.
“Consider Vantiv’s recently announced purchase of Worldpay. We know that payment processors have been on fire — Visa’s red-hot, Mastercard’s red-hot, PayPal’s red-hot, and both Vantiv and Worldpay are very much part of that bull market in process,” the “Mad Money” host said. “Yet this deal, which we learned about last week, seems like it’s been flying totally under the radar screen. That seems crazy to me, even as I recognize that there’s been a lot of really distracting news coming out of Washington lately.”
Setting the Trump administration’s troubles aside, Cramer said this overlooked deal between Vantiv, a merchant acquirer that enables retailers to accept and process electronic payments, and Worldpay, a U.K.-based company of similar ilk, is worth examining in-depth. Via cnbc.com
IBM’s Trade Finance Solution on Blockchain to Be Adopted by 7 European Banks – NEWSBTC
The banking industry’s infatuation with blockchain technology is well-known. In the forefront of the development of distributed ledger solutions for the industry is the tech giant IBM which is working on a trade finance solution for leading European banking institutions.
IBM identified the project addressing the present challenges faced by the trade finance segment following a survey conducted in collaboration with the Economist Intelligence Unit. Through this project, the company will be aiming to simplify the trade finance transactions for small and medium-sized businesses, states a recent report on one of the financial news publications.
Seven banks including Deutsche Bank, KBC, and HSBC will use the IBM’s blockchain solution. In a statement, the general manager of trade finance at KBC said, “What we will have is a platform to bring buyers and sellers together and to make trade transactions very transparent… from the moment that a purchase order is issued up until payment… The first service that will be available for buyers and sellers is financing and risk coverage, and it will also include a track-and-trade system so that buyers and sellers can follow the physical transfer of the goods.” Via NEWSBTC
Revolut raises $66 million for its global banking alternative
Revolut has raised a $66 million Series B round with Index Ventures leading the round, and existing investors Balderton Capital and Ribbit Capital also participating. The startup will also run another $5 million crowdfunding campaign in a few weeks. The company has raised $83 million in total.
Revolut started as a mobile app that lets you send and receive money in multiple currencies. Over time, the company has added a ton of financial services, turning it into a credible alternative to a regular bank account.
When you sign up, you can create virtual cards and receive a good old plastic MasterCard. You can top up your account using another card or a bank transfer. You can exchange your money in 16 different currencies in order to send it or spend it without any fee up to £5,000/€5,000 per month. 700,000 people have signed up so far. That’s why users are also using Revolut to split bills and instantly send money. Via techcrunch.com
Google Targets India’s Mobile Payments
India, already a mobile payments market marked by heavy hitters such as Paytm and Airtel, is proving alluring for Alphabet via Google and several of its subsidiaries.
Factordaily.com reports news that, as noted by AP Hota, CEO and managing director if the National Payments Corp. of India (NPCI), the e-commerce giant is nearly done testing its UPI payments service, allowing for mobile money transfers between banks.
One impetus to mobile wallet adoption has been the demonetization that marked the end of 2016, when the Indian government removed roughly 86 percent of the country’s currency from circulation. That has benefitted firms such as Paytm, which have added users in droves, and merchants too, as mobile payments gain traction. The entrance by Google into the market means that Paytm and other firms more entrenched in the market now have greater competition. Via pymnts.com
Snapdeal wants Flipkart to pay at least $900 million for buyout
Bengaluru: Online marketplace Snapdeal has asked bigger rival Flipkart to pay at least $900 million in stock after rejecting the latter’s latest buyout offer, said two people familiar with the matter.
Flipkart is yet to respond to Snapdeal’s demand but the company will send a new offer this week that will be higher than its previous bid of $700-750 million, the two said on condition of anonymity. Mint reported on 4 July that Snapdeal (Jasper Infotech Pvt. Ltd) had rejected an offer of $700-750 million from Flipkart, which had initially proposed buying Snapdeal for close to $1 billion.
The companies hope to agree on the price and the broad terms of the deal by the end of next week, said the people cited above. After that, the companies will continue to negotiate on the final terms of the transaction, they said. Via livemint.com
Tencent is trying to bring WeChat Pay into Malaysia
Tencent, the company behind popular social chatting app, WeChat, has applied for a license to enable payment services in Malaysia. If this goes through, Malaysians make payments using their smartphones seamlessly via their linked bank accounts.
WeChat Pay is huge with 1 out of 3 users in China using the platform as a mode of payment. Apart from paying for goods and services, WeChat’s platform is more extensive compared to other mobile payment systems. It offers fund transfers to your contacts, bill payments and even sending virtual red packets during Chinese New Year.
Chinese mobile wallets are expanding beyond its home market in China. A few months ago, Alipay has officially arrived in Malaysia with 7-Eleven as their first supported retailer. CIMB and Maybank are reported to be enabling AliPay wallets in Malaysia. Recently, WeChat Pay has also just entered Europe, making it easier for Chinese tourists to make payments at local shops.
At the moment, Tencent claims to have 600 million active WeChat Pay users in China while Alipay is reported to have 450 million active users. In Malaysia, Tencent claims to have 95% smartphone penetration for WeChat and that should make it easier for users to adopt WeChat Pay once it is officially available. Via soyacincau.com
PayMob launches ‘Accept’ to boost online payment
Egypt’s Fintech startup PayMob, and one of A15’s portfolio companies, launched a new product today called Accept – a payment aggregator that provides online and offline merchants with payment acceptance services.
According to recent studies, the e-commerce industry in the MENA region is expected quadruple to $20 billion by 2020, compared to 2015; while there is a striking 86% of adult population who do not have a bank account.
These statistics pose a great opportunity for Accept as it will provide online, as well as offline, merchants with a set of tools to accept payments in various forms whether through Online Payment, Mobile Wallets, Credit Card terminals, or even Cash Collection. Accept also enables merchants to sell directly through social media, without requiring a full e-commerce website, allowing sellers to harness the power of these networks to maximize revenues. Via adigitalboom.com
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