7.18.17: 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:
Mastercard expands AI tech: Mastercard has agreed to buy Brighterion, a software company that specializes in artificial intelligence. The card brand hopes this deal will improve customer experience and security. Artificial intelligence, or programs that improve by analyzing data that accrues over time, is catching on as a way to bolster marketing, improve credit scoring and reduce fraud. Brighterion will enhance Mastercard's ability to respond to the pressure retailers and issuers are under to adopt the new technology. "To fully realize the promise of our increasingly digital lives, we need to design our payment systems with the future in mind and that's what we're doing," said Ajay Bhalla, president of enterprise risk and security for Mastercard, in a press release. Financial terms of the acquisition were not disclosed.
Amazon expands its menu: Amazon's multi-pronged assault on the grocery industry is going beyond Whole Foods, AmazonFresh Pickup, Amazon Go, and its many other existing channels for selling food. Its next efforts could be "meal kits," a model similar to that of Blue Apron, CNBC reports. Amazon filed for a trademark July 6 for a service that offers prepared food kits, with a focus on grain, rice, pasta and bakery products, the article states. Blue Apron, the largest provider of meal kits in the U.S., recently went public and has seen its share prices slip ever since; the stock was sent to an all-time-low $7 after the Amazon trademark surfaced, according to CNBC.
Swift opens up compliance group: Swift has opened its "Know Your Customer" registry to all supervised financial institutions. Banks had to previously join Swift to access and use the KYC registry. The move is designed to broaden coverage of correspondent banking and fund distribution networks and bring more efficiency to customer due diligence. The registry includes information on best practices and transparency for financial institutions that are managing risks for money laundering and other illegal activities through bank payment rails. The registry has also served local financial crime-fighting efforts in Latin America.
Revolut boosts its payroll game: Automating salaries has become a large part of payments innovation, particularly as employment structure changes to accommodate more contractors and part-time workers. Financial services startup Revolut has drawn a $66 million investment led by Index Ventures, and has quickly put that money to work on a feature that allows users to generate their own International Bank Account Number (IBAN) for Euro transactions. TechCrunch reports that feature will allow people to receive salaries directly on Revolut accounts. Revolut previously had only one bank account to receive all Euro transfers. It would then credit the user's Revolut account through the transaction reference and sender's name. With the update, all users can get their own IBAN, a process that takes a few seconds, and give it to their employer. They can later cash out to PayPal or another P-to-P system.
Max Baucus says China's beating the U.S. at payments innovation: China is rapidly embracing digital payments and is overtaking the U.S., according to Max Baucus, former U.S. Ambassador to China and former Democratic U.S. Senator from Montana. Forbes reports Baucus, who was speaking at a business conference in Shanghai, told attendees China was "rushing" to online payments while systems such as Apple Pay in the U.S. are developing "very slowly." The legacy payment and bank systems in the U.S. are "still useful," but will soon be overtaken by newer, innovative payment systems in China and other Asian markets, said Baucus, who resigned his ambassador post after Donald Trump was elected president in November. Forbes did not provide specific examples, though Ant Financial and Tencent are aggressively pursuing digital payments, and several cities in China have embarked on "cashless" initiatives.
From the Web
The plan to make chip credit cards less annoying
Chicago Tribune | Mon Jul 17, 2017 - In most of the world, buying goods with a credit card equipped with a chip is a mindless, routine task. Americans, having arrived late to chips after decades of swiping magnetic stripe cards, are having a much harder time with it. Customers' experience with chip cards should improve gradually, one upgrade at a time, as the systems become more standardized, industry experts say. Slow transactions and confusing interfaces will disappear, or retailers risk losing customers to rivals with more pleasant checkout experiences.
Staff-less shops zoom into frame
China Daily | Tue Jul 18, 2017 - Chinese e-commerce giant and data technology provider Alibaba Group has just unveiled a cashier-free retail store. The online group has joined other retail chains and tech startups flocking into the market with their own solutions, making staff-less retail one of the hottest tech trends. Tao Cafe opened for a trial run on July 8. In the footsteps of the Amazon Go store that made a big debut last year with its use of tracking cameras, it utilizes a facial and voice recognition system. Purchases are tracked by a facial recognition camera, and the system automatically generates bills as soon as customers walk out of the specially designed gate that can identify them with biological sensing technology. Kicking it off before Alibaba, Guangdong-based tech startup BingoBox started to spread its version of staff-less stores, after being granted 100 million yuan ($14.8 million) in its first round of financing. Unlike Tao Cafe, Bingobox is more of a hybrid between convenience stores and vending machines, where customers can walk in and pay by scanning QR codes on their phone. This bypasses eye contact and small talk that normally take place with cashiers in traditional stores.
British lawmakers say data must move freely after Brexit
Reuters | Tue Jul 18, 2017 - British lawmakers said restricting the movement of EU citizens' data after Brexit would hurt trade and security co-operation, and transitional arrangements should be made by the government to keep information flowing after Britain leaves the bloc. British companies trading with the European Union after Brexit will have to comply with the strict rules the EU imposes on anyone taking data from consumers in the bloc. However, suspicions in Europe that London tolerates more intrusion by security agencies than in countries such as Germany might result in Britain facing demands for even tighter rules for handling EU citizens' data, experts have said. A committee of the upper house of parliament said on Tuesday that Britain could be put at a competitive disadvantage and the police could lose access to intelligence, if the government failed to retain unhindered flows of data.
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