Visa shares surged on Wednesday after the credit card issuer posted much stronger-than-expected first quarter earnings amid a consumer spending rebound powered in part by business and personal travel following a "short-lived" jump in Omicron infections. Dow component Visa earned $1.79 per share over the three months ending in March, well ahead of the Street consensus forecast, as group revenues jumped 25% to $7.2 billion. Cross border spending was up 38%, Visa said, and its suspension of payments in Russia only affected around 4% of its revenues and resulted in a modest $60 million charge.
Mastercard reported first-quarter 2022 earnings of $2.76 per share. The quarterly results benefited from substantial recovery in cross-border volume, which resulted from cross-border travel rebounding to pre-pandemic levels as of March 2022. Improved gross dollar volume (GDV) and higher switched transactions contributed to the upside. However, the upside was partly offset by escalating operating expenses.
Fiserv, Inc., a leading global provider of payments and financial services technology solutions, reported financial results for the first quarter of 2022. "We had a strong start to the year as we posted double-digit organic revenue and adjusted earnings per share growth, both above the outlook range we provided for the year," said Frank Bisignano, President and Chief Executive Officer of Fiserv. "We delivered these results while continuing our strategy of investing in innovation for growth."
PayPal Holdings Inc.’s top management made it plain late Wednesday they’re not backing down from a strategy they outlined three months ago that made it seem the payments giant was abandoning an emphasis on sheer growth in favor of increased user engagement. That impression disappointed analysts who follow the company and shaved nearly 20% off its stock price the following day. But on Wednesday chief executive Dan Schulman added some context to that strategy, emphasizing PayPal is seeking growth through existing and new products, including its newly revamped digital wallet and an improved checkout for online merchants.
May require account to read. The U.S. consumer watchdog will revisit its rules around credit card fees in a bid to stamp out abuses, discourage excessive late fees and boost competition, the agency's director told Congress on Wednesday, confirming a Reuters April report. "I am asking the staff to look at whether we should reopen the CARD Act rules ... to determine whether there needs to be any changes," said Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra.
The brand licensing and marketing company Authentic Brands Group sued partner San Francisco-based one-click checkout startup Bolt Financial in March, according to a complaint filed with the U.S. District Court in the Southern District of New York. In the lawsuit, ABG alleges Bolt “utterly failed” to deliver on its technology promises, which resulted in lost sales for its fashion brands, which include Forever 21, Nautica, Reebok and Lucky Brand, among others. Bolt denies the claims in ABG’s lawsuit and has filed a motion in court to dismiss it.
Nexa Equity LLC, a private equity firm focused on scaling lower middle market software and fintech businesses, announced that it has acquired Choice Inc., a leading global payments platform. Additionally, Choice has acquired Direct Payment Consultants, a payments provider that partners directly with merchants. After the acquisition, Choice's platform will process more than $3 billion in annual payments volume across 7,000+ customers in the United States and Canada.
US Senators Elizabeth Warren and Robert Menendez have blasted bank-backed P2P payments app Zelle over reports of widespread fraud and scams on the platform. In a letter to Zelle operator Early Warning Systems, the senators say: "Both your company and the big banks who both own and partner with the platform have abdicated responsibility for fraudulent transactions, leaving consumers with no way to get back their funds." Owned by seven of the biggest banks in the US, Early Warning introduced Zelle in 2017. Last year it saw $490 billion in transactions, twice as many as its nearest competitor Venmo.
Cyberattacks continue to increase across the banking industry, while fraud related to the Paycheck Protection Program also remains a key issue. At the same time, discriminatory lending practices are still prevalent and improper uses of new technology are grounds for caution. For these reasons and more, senior executives need to pay close attention to a wide range of significant challenges and critical developments. Here are eight of the biggest issues banks need to manage.
Apple Cash, formerly known as Apple Pay Cash, may be transitioning from the Discover payments network to Visa, a new report from MacRumors suggests. Visa has a much larger global network than Discover, which might account for the move. Since its launch in 2017, Apple Pay Cash had a partnership with Green Dot Bank on Discover’s network, but in recent days, users have noticed that Apple Cash virtual cards now have a Visa logo on them. Apple Cash virtual cards live in users’ Apple Pay mobile wallets, and let them send peer-to-peer payments via iMessage.
The Central African Republic has become the second country in the world to approve Bitcoin as an official currency, following El Salvador’s bumpy rollout of the cryptocurrency last year. Spokespeople for the country’s government confirmed that the move had been taken, the BBC, Reuters and Bloomberg reported on Thursday. A spokesperson for Central African Republic President Faustin-Archange Touadéra told Reuters on Thursday that adopting Bitcoin would improve conditions for the country’s population.
Twitter’s co-founder and former CEO Jack Dorsey is poised to receive a significant payday if Elon Musk’s $44 billion acquisition of the social media giant closes, as his Twitter shares would be converted into cash. Dorsey, who has declined to take a salary from the company and instead chose to take a $1.40 annual paycheck, owns 2.4% of the company, with just over 18 million shares. Under Musk’s offer to buy each Twitter share for $54.20, Dorsey would receive a $978 million in cash, according to a report.
Amazon Go, the tech giant's cashierless store concept, is ready for its move to the suburbs. The company is opening a new Go store in Mill Creek, Wash., on Tuesday morning, which it says will target customers living in suburban areas. Like its other Go stores, customers won't need to visit a cash register when they're ready to check out. They grab what they need and leave.
Robinhood Markets Inc. was supposed to upend the way people trade. Instead, the way people trade is starting to upend Robinhood. Less than a year into its run as a public company, Robinhood is dismissing 9% of its 3,800-person workforce. The Silicon Valley startup that once threatened to challenge Wall Street said that after a period of “hyper growth” and robust hiring in 2020 and early 2021, it was left with too much overlap.
Simon and Brookfield have quite a bit of experience blurring the lines between landlord and tenant. Simon shares a robust portfolio of retail names as partner in Sparc Group, a 50-50 tie-up with brand management firm Authentic Brands Group; Sparc is now the operator of Aeropostale, Forever 21, Lucky Brand and Brooks Brothers. Brookfield two years ago announced it aims to put $5 billion toward revitalizing struggling retailers, focused on those with $250 million or more in normalized revenues.
Facebook's parent company, Meta, doesn't just want to sell its virtual reality headsets, video chat devices and smart glasses online. It wants people to try out the products in a store. Meta said that it's opening its first retail store on May 9. The 1,550-square-foot space will be located on the social network's campus in Burlingame, California, where employees are focusing on the metaverse -- virtual worlds where people will be able to work, play and socialize.
Chipotle Mexican Grill’s quarterly earnings and revenue topped Wall Street’s estimates, fueled by consumers’ willingness to pay more for their burritos and bowls. The restaurant chain reported first-quarter net income of $158.3 million, or $5.59 per share, up from $127.1 million, or $4.45 per share, a year earlier. Chipotle’s restaurant operating margins shrank as it paid more for beef, avocados, paper and labor. However, menu price hikes and lower delivery costs helped offset those higher costs.
T-Mobile Park is doing something with checkout-free retailing that no other Major League Baseball ballpark has done. The Seattle Mariners Major League Baseball franchise, which plays its home games at T-Mobile Park, is teaming up with hospitality partner Sodexo Live to bring both Amazon “Just Walk Out” frictionless shopping technology and the Amazon One palm-based payment system to T-Mobile Park.
Essilor Manufacturing, a unit of the French maker of Ray-Ban glasses, has sued JPMorgan Chase Bank over claims the bank had ignored red flags as cybercriminals from around the globe drained $272 million from its New York account, a report said. Essilor said JPMorgan had been aware as of September 2019 of a suspicious pattern of fraud, though there were no notifications. Essilor operates a Thailand-based manufacturing plant for EssilorLuxottica SA. JPMorgan Chase Bank is a unit for JPMorgan Chase.
The number of individuals affected by a data breach at one of the largest providers of dental support services in the United States has increased to more than 2.5 million. Smile Brands, based in Irvine, California, disclosed a data security incident involving ransomware back in June 2021. The company became aware of a ransomware attack affecting some of its computer systems on April 24 2021. An investigation into the incident determined that certain protected health information (PHI) had been acquired by an unauthorized third-party.
New security standards released a month ago has promised to create a much more secure environment for card-based payments. PCI DSS 4.0 is said to give businesses “more flexibility,” while allowing them to select and use their own solutions to meet the security objective of PCI DSS, according to a release. Indeed, since malicious code downloads and intrusions have become perhaps the more difficult challenges for financial firms in recent months, this standard is expected to better help retrieve card data.
Congressional leaders and members appointed to a bicameral conference committee are facing increased pressure to include marijuana banking reform in a large-scale manufacturing and innovation bill, with two key lawmakers sending a letter on Wednesday urging its inclusion in the final package that’s set to be discussed by bicameral negotiators.
Gross domestic product unexpectedly declined at a 1.4% annualized pace in the first quarter, marking an abrupt reversal for an economy coming off its best performance since 1984, the Commerce Department reported Thursday. The negative growth rate missed even the subdued Dow Jones estimate of a 1% gain for the quarter. GDP measures the output of goods and services in the U.S. for the three-month period.
Deutsche Bank raised eyebrows earlier this month by becoming the first major bank to forecast a US recession, albeit a "mild" one. Now, it's warning of a deeper downturn caused by the Federal Reserve's quest to knock down stubbornly high inflation. "We will get a major recession," Deutsche Bank economists wrote in a report to clients on Tuesday. The problem, according to the bank, is that while inflation may be peaking, it will take a "long time" before it gets back down to the Fed's goal of 2%.
The prospect of further lockdowns in China prompted a fresh wave of economic anxiety on Monday as investors and companies whose supply chains run through China contemplated the impact of 70 new virus cases that the Beijing government said it had detected over the weekend. The city government ordered one of its districts to test all 3.5 million of its residents for coronavirus in the coming days, a move that may be a prelude to a larger lockdown in China’s capital city. Shanghai, a major port and business center, has been locked down for roughly a month, part of China’s “zero Covid” strategy.
“The first quarter of this year included a devastating war in Ukraine, record-high inflation, and shifting monetary policy expectations,” said Roger Hochschild, CEO and President of Discover. “Notwithstanding, we continue to execute against our business priorities, evidenced by our accelerating loan growth and continued strong credit performance, while investing in profitable growth. Earlier this month, we launched our refreshed Cashback Debit product, which showcases how we’re innovating to meet our customers’ needs in a manner consistent with our brand promise around rewards, no fees, strong service and product transparency.”
Gilles Grapinet, CEO of Worldline, said: “During the first quarter of the year, Worldline executed a very strong start of the year with a solid organic growth of +11.6%, confirming the strengths of its competitive positioning. This performance was reached thanks to the very dynamic growth in Merchant Services. In Q1, we signed many new contracts with renowned international retail groups who have chosen Worldline for their payment needs, while we enjoyed a very dynamic commercial activity with the SMB merchants."
“Our first quarter results represent strong execution with good momentum across our strategic growth initiatives despite significant macroeconomic and geopolitical challenges,” said Michael Hayford, Chief Executive Officer. “As a global company, a confluence of external factors impacted NCR. Inflation skyrocketed to the highest level in over 40 years, interest rates increased more rapidly, a war broke out in Eastern Europe and the Omicron variant spread.
Talus Pay, a fast-growing technology-driven provider of payment processing solutions for small and mid-sized merchants, is pleased to announce payments industry veteran Bryan Fricke has joined the company as chief revenue officer. Fricke will be responsible for the performance, strategy and alignment of all revenue generating go-to-market channels encompassing sales, marketing, product and customer success teams.
NMI, a leading full commerce enablement technology company, announced the appointment of Peter Galvin as CMO. Galvin brings more than 20 years of experience in growing and leading businesses in enterprise software and SaaS. With an extensive background in B2B marketing, he will play an integral role in the company’s go-to-market strategy, for both NMI and their newest acquisition of IRIS CRM.
EBA CLEARING, SWIFT and The Clearing House (TCH) announced that they plan to launch a pilot service for immediate cross-border (IXB) payments with the support of banks from both sides of the Atlantic. The pilot service is scheduled to begin by the end of this year with several participants joining the service in a phased approach. It is being designed with the contribution of 24 financial institutions, including those that are preparing to join the pilot.
The research shows that governments that advance the real-time modernization of their national payments infrastructure create a win-win situation for all stakeholders in the payments ecosystem: consumers and businesses benefit from fast, frictionless and hyper-connected payments services, financial institutions future-proof their business in a highly competitive environment by speeding up cloud-first and data-centric modernization, and national governments boost economic growth, reduce the size of their shadow economy and create a fairer financial system for all.
Mastercard on Monday announced the launch of an enhanced identity solution designed to improve the online shopping experience and tackle digital fraud in a new collaboration with Microsoft Corp. Now more than ever, delivering a frictionless shopping experience is critical as retailers look to shift window shopping and price comparison visits to confirmed sales. And, while consumers enjoy the convenience of shopping online, fraudsters also seek to develop new methods to use these same channels for ill-gotten gains.
Leading specialised payments platform, Paysafe, has appointed crypto executive, Elbruz Yılmaz, into the newly-created role of Senior Vice President, Crypto. In this role, Yılmaz is charged with further extending Paysafe’s group-wide crypto offering to meet the growing needs of its merchant and consumer customers around the world. Effective immediately, Yılmaz is the latest senior hire to the leadership team of Chirag Patel, CEO of Paysafe’s Digital Wallets division.
Adyen, the global financial technology platform of choice for leading companies, is now processing payments for Amazon Japan. Using Adyen’s platform, Amazon Japan will further optimize the payment data and checkout experience for its Amazon.co.jp customers. Adyen’s direct acquiring and data-rich insights enable Amazon Japan to provide a more seamless flow for its customers, whether they’re shopping from Japan or overseas.
Stripe launched the Stripe Partner Ecosystem, a new partner program with leading firms whose services enable Stripe users to thrive in the internet economy. The Stripe Partner Ecosystem comes as companies are accelerating their digital modernization, and increasingly looking for support outside their own organizations. Surging demand for third-party technology and payments expertise has followed, along with growing adoption of SaaS tools, cloud infrastructure, and ecommerce platforms.
Billtrust, a B2B accounts receivable automation and integrated payments leader, announced that it has expanded its Business Payments Network (BPN) provider relationship with KeyBank to include B2B invoice delivery in addition to capturing payments and processing remittance data through its first-of-a-kind digital lockbox. In reselling BPN to business clients, KeyBank will now enable them to automatically deliver invoices to more than 170 leading accounts payable portals.
DipJar, a giving technology platform, has opened its new corporate headquarters in Pittsburgh.The new facility will allow the company to expand its sales, marketing, and executive functions, while maintaining a strong engineering presence in the company's Boston office. The 3,500 sq. foot headquarters, located at 607 Washington Road, Suite 300, Pittsburgh, Pa 15228, has a flexible layout with open office elements that can be expanded to support the company's rapid growth. DipJar has more than doubled in headcount since 2020.
Nexio announces that it has partnered with Chargebacks911 – the leading dispute technology specialists. This alliance means that Nexio will now benefit from Chargebacks911’s end-to-end dispute management offering while reaping transformative results for its merchants. According to the True Cost of Fraud report by LexisNexis, every $1 in chargebacks costs the merchant $2.86.
WEX announced the launch of Flume, a digital payment platform designed to enable fast, transparent payments for small and medium businesses (SMBs). The brainchild of the company’s incubator WEX Ventures, Flume is a unique digital wallet specifically designed to support the 30 million U.S. businesses currently relying primarily on slow, analog payment methods. Unlike most payment platforms focused on digitally enabled companies, Flume aims to help close the digital divide for overlooked trade-oriented businesses initially with less than $15 million in annual revenue.
Cross River Bank, a technology infrastructure provider that offers embedded financial solutions, announced a partnership with Sardine, a behavior-based fraud and compliance platform for digital wallets and neobanks, to ensure Sardine’s customers have a reliable way to gain immediate access to funds through Cross River’s infrastructure platform. "As a crypto-first financial institution, supporting the crypto industry is not only core to Cross River’s mission, but it’s also our responsibility," said Luca Cosentino, Head of Digital Assets at Cross River.