9.28.17: 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:
How much will PayPal pay for scale? PayPal may be set to spend billions of dollars as a competitive play against big recent deals among merchant acquirers, reports CNBC. Quoting Bernstein analyst Lisa Ellis, CNBC noted potential deals for companies such as Square, Stripe or Adyen — if any of these companies are for sale — would be substantial, given Stripe is valued at more than $9 billion, and Square's most likely price tag would be about $10 billion. CNBC reports PayPal is "sitting on" about $15 billion, which would cover those costs. But PayPal may be more interested in an overseas target to counter Vantiv's merger with Worldpay and Visa's Klarna stake, according to the news service. PayPal has made large acquisitions in the past as a fast competitive response. It paid more than $800 million to acquire Braintree and its Venmo unit in 2013 to add software development tools to accommodate the growth of the "app economy." PayPal shelled out about $900 million in 2015 to acquire Xoom to counter Western Union's strength in remittance and more recently acquired small business lender Swift Financial to scale PayPal's merchant capital program against competitors such as Square.
Mall for supply chain e-commerce: Online marketplaces Mall for Africa and Mall for the World are collaborating to form an early-stage logistics e-commerce ecosystem. Called WCA, it will provide members access to more than 200 U.S. and U.K. retailers that are part of MFA and MFW's merchant network. The single source of supply chain transactions and fulfillment is designed to reduce costs and resources as a competitive move against other cross-border payment and supply chains. MFA and MFW will manage orders, checkout, shipments and delivery. WCA will also supply guidance and other advisory services. “Having a strong presence on the ground is crucial and having partners we trust is even more important. We know having our platform at the members’ fingertips will be a great selling point to their current and future customers,” said Chris Folayan, CEO of Mall for Africa and Mall for the World, in a release.
Breach fallout leads to opportunity: The Equifax breach has sparked a huge technology vendor push, and one of the latest is a voice security play from Pindrop. The company Thursday morning released Protect 4.0, a high-def system that analyzes more than 1,300 features of a call's audio to detect subtle anomalies that could indicate a fraudulent transaction. Pindrop's product is also designed to determine device type, location and carrier as added security factors. It also uses metadata and machine learning to score each call based on existing fraud profiles. "As costs and losses continue to rise, the c-suite is waking up to the fact that phone security is becoming the nexus of fraud across their organizations," said Vijay Balasubramaniyan, CEO and co-founder of Pindrop, in a release.
Worldpay's IoT toolkit: Large payment companies such as Mastercard, Visa, and NCR have all taken steps in the past year to accommodate payments for connected devices, or the Internet of Things. Worldpay this week weighed in, announcing it's testing an open source software development kit to allow connected devices to accept payments. WorldPay Within will enable developers to build connections for embeddable payments, and machine-to-machine transactions. WorldPay is additionally running a hackathon in October in Romania for developers to build IoT payments using WorldPay's SDK. The company estimates there will be 20 billion connected devices globally by the end of the year.
From the Web
UnionPay launches mobile payment in public transportation in 20 cities
China Daily | Thu Sep 28, 2017 - China UnionPay now has its eyes on public transportation, with its mobile payment service launching in the sector in 20 cities in less than five months, according to a report by Securities Times. The domestic payment service provider and Guangzhou Metro made a joint announcement Tuesday that passengers can use Apple Pay with UnionPay's QuickPass service to directly pass through all subway stations' fare gates in Guangzhou, capital city of Guangdong province, the first of its kind in China. QuickPass is UnionPay's "tap and go" application that allows users to complete transactions by scanning QR UnionPay codes or placing their smart mobile devices near the card slots or the near-field communication technology (NFC) reading areas of compatible point-of-sale (POS) terminals. Last week, the service became available in buses, subways, high-speed trains and various kinds of bike-sharing platforms in Hangzhou, Zhejiang province.
U.S. banks urged to waive fees, allow late payments on Maria-hit islands
Reuters | Thu Sep 28, 2017 - U.S. banks should waive customer fees, ease credit card limits and allow borrowers to make late payments on the islands affected by Hurricane Maria, a top banking regulator said on Wednesday. Lenders should also consider increasing ATM cash limits and easing terms for new loans in communities battered by the storm’s ferocious winds and torrential rains, said the Federal Deposit Insurance Corporation, which regulates national banks. “The FDIC encourages banks to work constructively with customers experiencing difficulties beyond their control because of damage caused by Hurricane Maria,” the regulator said in a statement to U.S. lenders.
Caisse, Novacap to invest in Quebec-based payment processor Pivotal
Reuters | Wed Sep 27, 2017 - Canadian pension fund manager Caisse de depot et placement du Quebec and private equity firm Novacap said they would invest in payment processor Pivotal Payments, valuing the company at about C$525 million ($424 million). The funding would allow the Quebec-based company pursue its plan to acquire payment and fintech solutions and expand into new markets, the companies said on Wednesday. Pivotal also offers global ecommerce services and has more than 50,000 merchants.
More from PaymentsSource
Faster payments must also be smarter payments to appease users
CHICAGO – As the U.S. continues to shape its faster payments options over the next few years, the connections for such systems have to be able to deliver more information and services with every payment.
Monetizing payment data has come back to haunt financial institutions
Amid a series of breaches, banks and payment services companies would be far better served by building solutions and programs that work toward instilling consumer confidence, instead of creating situations that continually erode trust, writes Madeline Aufseeser, CEO of Tender Armor.
Data: The shifting sentiments of 'on file' payments
A recurring theme at SourceMedia's PayThink conference held in Phoenix last week was “on file” payments. These go under numerous monikers — Invisible Payments, Default Payments, Frictionless Payment and “Uberized Payments," among others, and the topic came up across multiple sessions relating to the increasing abstraction of transactions in areas such as in-app, online and Internet of Things payments.
Blockchain's next move will make bitcoin's value seem 'insignificant'
Very large, established industries like financial services have strongly entrenched ways of doing business that, over time, have become inefficient, writes Mariam Nishanian, a representative for Dentacoin, adding blockchain can change that.