Morning Brief 6.4.20: Fed won't change payment formats for next two years
The information you need to start your day, from PaymentsSource and around the web:
The Federal Reserve does not plan to change any messaging formats through the end of 2021, including the initial phase of the Fedwire Funds Service migration to ISO 20022.
ISO 20022 allows more information about transactions to be transmitted simultaneously, which can help process e-commerce and mobile payments in real time, so the standard underpins global faster payment initiatives.
The Fed's move follows Swift's delay of its new messaging standard to November 2022, a decision that has already complicated digital payment standard migrations in Europe, Finextra reports. Both the Fed and Swift have attributed the delays to the coronavirus, with the Fed saying it's still committed to the new standard. The Fed plans its own real-time payment system, FedNow, though it's not expected to launch until 2024.
The Reserve Bank of Australia may reduce fees for electronic payments given the rush to digital during the coronavirus outbreak.
The RBA reports ATM withdrawals are down 40% from the prior year, suggesting more digital transactions. But debit payments carry higher charges for certain routing schemes, causing an unexpected expense, reports The New York Times.
The RBA is reviewing these schemes and fees to vet transparency, though it has not yet mandated least-cost routing options for merchant acquirers.
U.K. fintech Revolut has launched an upgraded version of its app that organizes financial needs into "home" and "wealth" as the company adds more financial services beyond its payments core.
The home tab includes Revolut accounts, linked external accounts via open banking connections, budgeting tools and financial planning. The wealth tab has stocks, crypto, commodities and investment products.
Revolut recently added TrueLayer's API to aggregate and update account information to power its open banking feature. It's also in the midst of a multi-year geographic and product expansion.
There have been a series of ATM thefts this week in Philadelphia, using a method in which the thieves use explosives to gain access to the cash machines.
The incidents caused at least one fatality, reports CBS, adding the machines were mostly in gas stations and convenience stores.
The ATM attacks came amid broader reports of looting in Philadelphia. ATM "explosion" attacks are a common form of ATM theft, with a series of similar ATM incidents in 2019 causing Dutch banks to take some machines out of service.
From the web
Varo Money Raises $241 Million As It Moves Closer To Becoming A National Digital Bank
FORBES | Wed June 3, 2020
Varo Money, a mobile banking startup, raised $241 million in venture funding with proceeds going to meet the capital requirements necessary to operate a national bank, develop new products, and otherwise support growth.
7.4 million in UK living an almost cashless life, data shows
THE GUARDIAN | Wed June 3, 2020
UK Finance, a trade association for Britain’s banking and financial services sector, said changes in payment habits had inadvertently left the nation better prepared to cope with life under lockdown than would have been the case a few years ago.
Google and Walmart establish dominance in India’s mobile payments market as WhatsApp Pay struggles to launch
TECHCRUNCH | Wed June 3, 2020
Google Pay had more than 75 million transacting users last month, ahead of PhonePe’s 60 million users, people familiar with the companies’ figures told TechCrunch.
More from PaymentsSource
Disney’s coronavirus workarounds dilute the magic of MagicBand payments
Walt Disney Co. has at least temporarily cut several reservation and incentive features tied to its closed loop payment system, revealing the complexities of mixing health guidance with tourism.
When the coronavirus fades, chargebacks will still be a threat
Merchants will need to adopt practices to curtail the surge in chargeback activity and protect their businesses, even after the worst of the coronavirus outbreak is over, says Chargeback 911's Monica Eaton-Cardone.
How two payments software firms kept innovating under quarantine
Innovating is tough even in ordinary times, but during the coronavirus pandemic many payments startups had to dig into deeper reserves of creativity and resilience to meet expectations.
SIA technology supports Berlin bank's co-brand card partnerships
Landesbank Berlin, a major issuer of co-branded cards in Germany, has launched a contactless card with German Automobile Club ADAC as its first project with European payments services provider SIA.
Alibaba extends 60-day financing to U.S. cross-border B2B buyers
As small businesses' cash flow tightens during the pandemic, Alibaba Group is enabling SMBs to postpone payments for 60 days on cross-border e-commerce purchases.
Amex increases contactless transaction limits in 26 more countries
American Express has added 26 Caribbean nations to the list of countries where it’s raised the ceiling on contactless transactions that may be conducted without PINs, to reduce consumers’ exposure to touching PIN pads.
PPP forgiveness challenge reveals an innovation shortfall
The Paycheck Protection Program (PPP) is a lifeline for millions of small businesses, but the road to economic recovery is rocky. For Main Street America, there is a lot of work ahead and that includes navigating the complex PPP loan forgiveness process.
An interpersonal gap requires a digital response
The health and economic crisis stemming from the coronavirus pandemic is unprecedented, and the trajectory of our economic recovery will be determined in no small part by the actions financial institutions and fintechs take now as they help communities and consumers navigate the volatile financial landscape.