5.26.17: Your morning briefing
Welcome to the PaymentsSource Morning Briefing, delivered daily. The information you need to start your day, including top headlines from PaymentsSource and around the Web:
Stripe makes new connections: The payments technology enabler Stripe is updating Stripe Connect, a product it launched two years ago for marketplace sellers, according to TechCrunch. The focus of this product is to enable payments for companies that accept funds on behalf of third parties; examples include online auction sites, crowdfunding platforms and "gig economy" startups, the article states. The updated version is designed for more complex transactions, such as "many to many" flows or escrow-like arrangements, TechCrunch states. The update also provides a new Express onboarding system, streamlining the process of signing up new payment recipients. Late last year, Stripe received a funding round that increased its valuation to $9.2 billion, up from $5 billion, enabling it to invest in technology and market expansion.
Distributed ledger not up to snuff in Canada: Following tests, the Bank of Canada reports distributed ledger technology is not ready to back a national interbank payment system in the country. Canada's central bank found the technology does not meet privacy and scalability needs, and won't be able to match the efficiency of a centralized system, reports the Globe and Mail. Payments Canada, which is working on a variety of projects to modernize Canada's payment ecosystem, and the R3 consortium are working on a distributed ledger initiative called Jasper, which uses Cad-Coin, a digital currency for interbank payments. The consortium has not given up on distributed ledgers for other use cases, but it's sticking with the adoption of ISO20022 messaging standard for its new core clearing and settlement system, and will not use distributed ledgers.
Contactless boosts U.K. debit: The popularity of contactless technology will help debit cards pass cash in the U.K. by 2018, three years earlier than expected, reports Finextra, citing analysis by Payments UK. Consumers used debit cards 11.6 billion times in 2016, 14% more than in 2015, and just over 20% of debit transactions were contactless payment. Cash is still the most used method, at 15.4 billion transactions and 40% of all payments in 2016. By 2018, cash will decline to 13.3 billion, falling out of first place for the first time. Cash will be far from extinct, however, as Payments UK's ten year forecast has 8.8 cash billion payments by 2026, still 21% of all transactions in the U.K. By that time debit will account for 18.2 billion transactions, and 25% of all U.K. payments will be contactless.
Amazon moves deeper into groceries: Amazon's encroachment into traditional retail includes no-cashier stores, bookstores and, increasingly, supermarkets. Amazon has started operating AmazonFresh pickup locations in Seattle, enabling consumers to order groceries online and pick them up on the way home. TechCrunch reports an order can be placed as little as 15 minutes before pickup, and the service is free for Amazon Prime members. The service is limited to Seattle, though TechCrunch reports Amazon will likely expand it to other cities. Kroger also offers a similar online order/store pickup service.
From the Web
Payment firm Soft Space raises $5M to expand in Southeast Asia and Japan
TechCrunch | Fri May 26, 2017 - Soft Space, a payment provider in Southeast Asia, has close its $5 million Series A as it looks to expand across the region, and potentially into Japan. Kuala Lumpur, Malaysia-based Soft Space works with large enterprise customers, typically banks, to offer customized solutions for mobile payment, both at point-of-sale and other parts of the process. Typically these solutions are white-labeled. The startup currently active in its home market, Thailand, Indonesia and Taiwan. This new investment is provided entirely by Transcosmos, a Japanese firm that specializes in business and expansion which works with chat app Line among others.
Monetary Authority of Singapore teams up with World Bank's IFC to encourage Asian fintech innovation
CNBC | Fri May 26, 2017 - The International Finance Corporation (IFC), a World Bank Group member, has signed a memorandum of understanding this week with the Monetary Authority of Singapore (MAS) in order to encourage fintech innovation in Asia via the establishment of an Asean Financial Innovation Network (Afin).
Fitch: U.S. Credit Card Losses Likely to Continue Upward Trend
Reuters | Thu May 25, 2017 - Credit card loss rates are likely to continue rising over the next several quarters driven by a more pronounced increase in delinquencies following the recent acceleration of loan growth, according to the latest U.S. Credit Cards Asset Quality Review from Fitch Ratings.
More from PaymentsSource
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E-commerce retailers need to pick their chargeback battles
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Amex refines its pitch to small-business cardholders
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Why Google is taking a risk in linking online ads to offline payments
At the recent Google Marketing Next event in San Francisco, Google revealed a new service designed to close the loop between online advertising and offline card payments. It's a service that should have marketers salivating, but it could easily backfire.