9.14.17: Your morning briefing

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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:

Google's India play: Google plans to release a local digital payment service in India as soon as next week, reports TechCrunch, which cites reporting from The Ken and some trademark filings. Google's service will be called Tez ("fast" in India), and will be distinct from Google Wallet or Android Pay, which are also in Google's plans for India. Tez will have a Unified Payments Interface, a government-backed system, and will support Paytm and MobiKwik. Google would not confirm the report to TechCrunch and could not be immediately reached for comment on Thursday morning. India is considered a fertile market for digital payments. The Indian government removed a lot of the country's cash from circulation last year, and other companies such as Samsung and Visa are also making investments in the country. TechCrunch also reports Google has registered "Tez" in Indonesia and the Philippines.
The end of ATMs' first 50 years: 2017 is the ATM's 50th anniversary, and Paragon Application Systems, a company that has tested ATMs for two decades, has issued a handful of warnings about the machine's future, highlighting changes that must happen for ATMs to remain relevant. ATMs must embrace mobile technology and make smartphones the primary interaction point, eliminating PIN codes, cards and passwords. Additionally, ATMs must resemble smartphones and tablets, given consumer comfort with these devices. ATMs must also integrate deeper into financial services, adding services that are in line with automated tellers. This will enable ATMs to play more of a role as banks change their branch strategies, according to Paragon. "Contrary to what you might hear, cash remains a preferred method of payment across the globe, making the reality of a cashless society in the near term unlikely," said Jim Perry, CEO of Paragon, in a release. "However, preferences and expectations are changing, and ATMs must concurrently evolve to remain relevant in financial services strategies."

The language of blockchain: Blockchain has developed many uses, such as embedding payments deeper into overall bank innovation, taking costs out of cross-border payments, and improving execution for securities payments. But the distributed ledger system lacks standard terms, contends the non-profit Accredited Standards Committee (X9). The committee has announced an initiative to write a glossary of terms and definitions for blockchain and distributed ledger technology, including bitcoin. There is confusion about some terms and phrases that different parties may understand differently, X9 said, adding the initiative will commence in October. "The idea for this new work item arose in the X9 blockchain study group, which was looking at the value of and need for standards in this area," said Guy Berg of the Minneapolis Federal Reserve, leader of the study group, in a release. "The need for a common language rose to the top: It's difficult to have clear communication when different parties are using different terms. The new TR will deliver a common vocabulary so that people can more effectively discuss and assess blockchain technology with fewer misunderstandings."

What would you like to pay? Monzo can no longer afford to offer free overseas ATM withdrawals, and it's asking its consumers to vote on what fee it should charge. The mobile payment company says its cost of oversea withdrawals has increased from about $8.50 per user to about $20 per user in the past year due to a segment of the company's customer base that is primarily interested in the overseas service. Monzo has placed a poll on its site with three options: A 1% fee for ATM withdrawals in Europe and 2% elsewhere in the world outside of the U.K.; a 1.5% fee for all non-U.K. withdrawals; or a free allowance of about $230 per month and a 3% charge thereafter. Monzo says these options are designed to cover costs and not turn a profit. The company does not charge fees for point of sale transactions.

From the Web

China’s Next Debt Addiction—Credit Cards
The Wall Street Journal | Wed Sep 13, 2017 - Interest in credit cards is growing in China, and it could be a bright spot for banks. Chinese consumers are alive and well—and increasingly carrying a credit card in their pockets. China’s rapid shift toward mobile payments has led some to assume the country would somehow bypass credit cards on the way to becoming a cashless society. The latest figures suggest otherwise: Credit card loans in China rose 31% on year to almost 4.69 trillion yuan ($718 billion) in the second quarter, according to central bank data. The stars have actually been aligning for the Chinese credit-card industry. Banks want to hand more of them out, while consumer confidence is off the charts. Beijing, meanwhile, is eager to shift more of China’s monumental debt pile onto households—which traditionally have high savings—and away from the highly indebted corporate sector.

From Silk Road to ATMs: the history of bitcoin
The Guardian | Thu Sep 14, 2017 - The digital currency lost 10% of its value after the JP Morgan boss described it as fraud – but it has come a long way since it was started in 2009. Bitcoin is a digital currency started in 2009 by a mystery figure named Satoshi Nakamoto, whose true identity is still unknown. It is unlike traditional currencies because it has no central bank, nation state or regulatory authority backing it up. The “coins” are made by computers solving a set of complex maths problems. To spend them, users buy bitcoin and conduct transactions with them using exchanges such as San Francisco-based Coinbase. Rather than a central authority validating transactions, they are all recorded on a public ledger, called the blockchain.

iOS 11 is a second chance for QR codes and NFC to hit it big
TechCrunch | Wed Sep 13, 2017 - Apple’s flashy new iPhones are hogging the spotlight right now, but iOS 11 is arriving before they do – on September 19, the major mobile software update will be available for existing iPhone and iPad devices. It’s bringing a lot of new features, especially to the iPad and iPad Pro, but it’s got two under-hyped payloads that could drastically change mobile apps, experiences and marketing. Those two new features in iOS 11 are a native QR code reader built directly into the Camera app, and an expansion of the onboard NFC chip support to allow it to read NFC tags in the real world (previously, NFC was strictly limited to Apple Pay use).

More from PaymentsSource

Is democratized ID the answer to the Equifax breach?
Security professionals have long argued against the use of static identifiers like passwords and Social Security numbers, while consumers have long questioned why a handful of bureaus can claim to be the ultimate judges of their identities.

Equifax breach forces businesses to face an expanding 'dark web'
Online businesses everywhere are going to be dealing with the effects of the recent Equifax breach.

How hate groups exploit the financial ecosystem
The recent events of Charlottesville, Va., have exposed the dark underbelly of hate groups and their media channels, and raised fresh questions about how they get funding.

U.K. forms new payments system operator
The U.K.’s Payment Systems Regulator and the Bank of England have officially formed the New Payments Systems Operator (NPSO), a regulatory body that will soon replace three existing payment systems.

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