Morning Brief 6.5.20: MoneyGram builds footprint ahead of possible Western Union deal
The information you need to start your day, from PaymentsSource and around the web:
Deal before the deal?
While it waits on a potential acquisition by Western Union, MoneyGram is still bolstering its own geographic footprint.
MoneyGram has partnered with Al Rajhi Bank, one of the world's largest Islamic banks, to support transfers in Saudi Arabia for both agents and digital channels. The bank has more than 230 centers and 110 correspondent banks, making it one of Saudi Arabia's latest financial institutions.
The deal follows quickly on other recent partnerships MoneyGram has entered to expand in India, Egypt, Pakistan and the Philippines, which are all main recipients of transfers from Saudi Arabia — one of the largest outbound remittance markets with about $33 billion in volume yearly, according to the World Bank.
In real time
Huntington has launched real-time payments over the RTP network, providing more momentum for The Clearing House's version of instant payments.
The RTP network has been adding bank support for most of the past year, adding necessary scale to support fast access to funds in mobile payments and other digital transactions.
RTP recently raised the transaction limit for real-time payments to $100,000. The Federal Reserve's real-time option, FedNow, is not expected to go live until 2024.
Mitsubishi Financial Group, Mizuho Financial Group and Sumitomo will join Japanese cryptocurrency exchange DeCurret to study digital currencies with the goal of developing national digital currency and payment products.
Other Japanese companies including telcos, law firms and the East Japan Railway company are also involved in the initiative, reports CoinDesk.
The companies will report to Japanese banking regulators and the Ministry of Economy and Internal Affairs. The underlying goal is to move Japan away from cash, with Japan hoping to reach 40% cashless payments by 2025.
Anti-money laundering and terrorist financing failures at Westpac that resulted in the bank setting aside about $1 billion to cover liability were reportedly a result of human and technology error, and not an intentional lapse or the work of bad actors.
The bank commissioned an external review, and found a poor understanding and a lack of resources caused the approval of more than 23 million transactions involving parties flagged for illegal activities, reports Finextra. The report also found IT projects were progressing too quickly to properly monitor payment flows.
The bank's top executives resigned as a result of the case, and Westpac pledged to double its compliance staff.
From the Web
Square Stock Surges to 20-Month High
THE MOTLEY FOOL | Thu June 4, 2020
Fintech company Square rocketed to its highest level in the last 20 months as it closed at nearly $92 per share. The immediate catalyst seems to have been encouraging monthly data from payment card giant Visa.
Superhero offers instant payment, turning web addresses into P2P wallets
ZDNET | Fri June 5, 2020
Vaduz, Liechtenstein-based Aeternity has launched Superhero, an electronic wallet that allows its users to send and receive P2P tips to people who post good content anywhere on the web.
Big U.S. Banks Could Take A Back Seat To Digital Payments Companies In The Wake Of Covid-19
FORBES | Thu June 4, 2020
Over the past decade, domestic banks have outpaced their global counterparts. In the future, however, U.S. banks, whose revenues come from proprietary trading and loans, could begin to recede as digital payments companies have less exposure to loan defaults, better technology and lower overhead costs.
More from PaymentsSource
How coronavirus forced the cash-centric cannabis industry to change
The coronavirus pandemic has changed the way many industries conduct business — and that's especially true of the legal cannabis industry, which was already struggling in the U.S. to find the best way to handle noncash payments.
Payment firms already have the tools for the coronavirus recovery
As merchants are challenged to adapt their business just to survive, and consumers push for greater control over where and how they spend, the payments industry is in a position to align the various needs, says Splitit's Brad Paterson.
Grab accelerates expansion of deliveries across Southeast Asia
Grab Holdings Inc., Southeast Asia’s ride-hailing giant, is expanding delivery services from convenience stores and supermarkets across 50 cities in the region.
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.
When the coronavirus fades, chargebacks will still be a threat
As the states gradually reopen their economies, many businesses are finding themselves facing a “new normal,” as people have taken to describing it.
Pot banking rules grow hazier during pandemic
The coronavirus pandemic has added another wrinkle to navigating state versus federal regulations when it comes to gaining access to banking services by marijuana-related businesses.