This is part three of an ongoing series focused on the financial and payments-related repercussions of the invasion of Ukraine by the Russian military. Part 1 | Part 2
Imagine all the upheaval currently in the U.S. economy, and the massive challenges we are facing to best address them. Now imagine that, but over half our country is being bombed. No doubt a scary thought. Yet the people of Ukraine do not need to imagine such a scenario. Instead, they imagine what they can do to prevent the crumbling pieces of their society from falling through their hands. And they are indeed succeeding in important ways, a surprise perhaps to some but perhaps not to many Ukrainians. How have they been resilient? Particularly from a consumer confidence and fintech perspective? Pragmatic central banking practices, rapid digitization of services and businesses, and strong support from Europe have all been key in keeping the civilian and military engines of Ukraine churning as Russian troops have taken roughly a fifth of the country.
Shortly after Affirm went public last year, CEO Max Levchin told Protocol that he saw “an ocean of opportunities” for the “buy now, pay later” pioneer. Wall Street agreed. Affirm’s stock soared in its trading debut as the company blazed a trail for a fast-growing alternative to the credit cards that Levchin says consumers are increasingly rejecting. But the picture has changed dramatically since then. Rising prices and interest rates, along with waves of layoffs, highlight fears of another recession. There’s also growing scrutiny of “buy now, pay later” companies as critics say they’ve led to a steady rise of bad consumer debt.
The Federal Reserve Board announced on Monday (June 27), the final timeline and other implementation details for the adoption of a new Fedwire Funds Service message format. The Fed has decided to delay the implementation of these changes until March 10, 2025, from the original date of November 2023. The reason for this delay is that the Fed is prioritizing the implementation of the new real-time-payment network, known as FedNow Service, which is expected to be launched also in 2023.
May require account to read. Digital payments are the default for millions of women of childbearing age. So what will their credit and debit card issuers and financial app providers do when prosecutors seek their transaction data during abortion investigations? It’s a hypothetical question that’s almost certainly an inevitable one in the wake of the overturning of Roe v. Wade last week. Now that abortion is illegal in several states, criminal investigators will soon begin their hunt for evidence to prosecute those they say violated the law.
My fintech company, Stax, achieved unicorn status in 2022, after nearly a decade of growing and championing our payments platform. We went through six rounds of fundraising, at times requiring a line of credit to keep the business running. In one of those moments, a particular investor voted against giving us a company-saving investment of $500,000 in the face of a $12 million buy-out offer. But we continued to grow — and ultimately exited our early-stage investors at 18x their investment.
Price inflation is rising at its fastest rate since the early 1980s, and that’s prompting dueling releases from both foes and advocates of card interchange, the fee merchants pay when consumers use credit and debit cards. Merchant groups have long inveighed against interchange—also referred to as “swipe fees”—as a cost burden for sellers that accept cards, but 8% inflation has handed them a fresh argument. The Merchants Payments Coalition on Wednesday issued a release contending that interchange fees “drive up prices [merchants] charge consumers,” exacerbating the impact of inflation.
Coinbase is seeking licenses with various countries in Europe as part of an aggressive expansion in the region. The exchange already has an active presence in the U.K., Ireland and Germany, but wants to set up operations in Spain, Italy, France, the Netherlands and Switzerland, according to Nana Murugesan, Coinbase’s vice president of international. Coinbase recently hired its first employee in Switzerland, he says. The U.S. crypto giant is looking to international markets to drive growth amid fears of a looming “crypto winter.”
Longtime Google exec Nick Fox will take over the company’s commerce and payments business on an interim basis. Fox’s appointment comes a day after the former head, Bill Ready, announced he is taking over the helm of Pinterest, replacing longtime CEO and founder Ben Silbermann. Nick Fox will lead Google’s “Commerce, Payments and Next Billion Users,” according to a person familiar with the matter. He will report to Google’s Search boss and SVP Prabhakar Raghavan.
For more than a decade, Silicon Valley’s moguls have been promoting Bitcoin and blockchain-based cryptocurrencies, claiming these will transform global commerce. Meanwhile, as those same hypesters now promote a mystical Internet world called Web3, India is racing ahead and implementing what the crypto crowd had promised—with its Unified Payment Services (UPI).
He is only 30 years old, but Sam Bankman-Fried has become the savior the struggling crypto industry needs to avoid a complete shipwreck. Bankman-Fried, known in crypto circles by the initials SBF, seems to have taken on this persona without hesitation. He is everywhere. It is difficult to talk about a struggling crypto firm without his name appearing as the potential savior to prevent things from going downhill.
Revolut's chief banking officer Sid Jajodia has picked up a new role as US CEO, overseeing the financial super app's extension into the US market. Jajodia joined Revolut as chief banking officer in July 2021 and will continue in this role alongside being US CEO, leading the roll out of Revolut’s international banking operations, as well as accelerating the company’s growth in the United States.
The good news for retailers is that the nation is unlikely to enter into a recession during the remainder of 2022. That’s according to National Retail Federation chief economist Jack Kleinhenz, who said that the U.S. economy’s rate of growth is slowing, but consumers remain financially healthy. He noted that while economic data is “softer than a few months ago,” it “still signals further solid economic growth.”
The Federal Trade Commission said Tuesday that it has sued Walmart for allegedly allowing its money transfer services to be used by scam artists who stole "hundreds of millions of dollars" from customers. In its lawsuit, the agency alleged that for years, Walmart failed to properly secure the money transfer services offered at its stores. The agency said Walmart didn't properly train its employees, failed to alert customers, and used procedures that allowed fraudsters to cash out at its stores.
Bed Bath & Beyond is replacing CEO Mark Tritton in a leadership shakeup after the retailer struggled through another quarter of declining sales and posted a steeper loss. The company said Wednesday that Sue Gove, an independent director on the board, will step in as interim CEO. The change comes after a multi-year push to revive Bed Bath’s brand, grow online sales and win back customers. Tritton, a Target veteran, had led the effort after joining in 2019.
Rather than entering the metaverse with a storefront to sell virtual goods, home improvement retailer Lowe's has opted to equip builders with items from its real-world shelves. From June 21 through July 20, Lowe's is offering more than 500 3D digital product assets available for download for free via Lowe's Open Builder, a new asset hub available to all online creators.
A spate of suspicious cash withdrawal attempts from a bank with branches spread across the United States uncovered a number of ATM devices used to skim customer account information. An investigation by Bank of the West concluded that debit card numbers and associated PINs, and possibly names and addresses, of an undisclosed number of customers have been compromised. Thieves may have used the stolen information to create fake debit cards and attempt cash withdrawals from legitimate customer accounts.
OpenSea, the popular NFT marketplace that hit a colossal $13 billion valuation in January, is warning users of email phishing after a data breach. A staff at Customer.io, an email vendor contracted by OpenSea, misused their employee access to download and share email addresses of OpenSea’s users and newsletter subscribers with an unauthorized external party, the world’s largest NFT marketplace said Wednesday night. The scale of the security breach appears massive.
US consumer spending fell in May for the first time this year and prior months were revised lower, suggesting an economy on somewhat weaker footing than previously thought amid rapid inflation and Federal Reserve interest-rate hikes. Purchases of goods and services, adjusted for changes in prices, decreased 0.4% after a downwardly revised 0.3% gain a month earlier, Commerce Department data showed Thursday. Spending on services advanced while outlays for goods declined.
Amazon’s annual (bi-annual?) Prime Day has consumers excited…for the most part. More than three-quarters (76%) of Prime Day shoppers plan to spend more or the same as they did in 2021, according to an Adobe Commerce survey of 1,115 consumers that was released today. This year, the motivations to shop vary: 56% said they shop to save money on Prime Day, while others said they’re getting a head start on holiday shopping (32%), or back-to-school shopping (23%).
Wells Fargo CEO Charles Scharf said he is betting on “more significant rate hikes” as the Federal Reserve tries to rein in high inflation, and that the economy is not as prepared as it should be. “I wouldn’t bet on a number, but I would bet on more significant rate hikes,” Scharf told CNBC’s Sara Eisen at the Aspen Ideas Festival on Wednesday, adding that he considers 50 and 75 basis point hikes to be “significant themselves.” “Is it going to be more than that? Maybe, but it would require some change in the data to see something like that,” he said.
It's not yet clear if the US economy will ever return to its pre-pandemic status, Federal Reserve Chairman Jerome Powell said Wednesday at a central banker forum in Portugal. "The economy is being driven by very different forces. What we don't know is whether we'll be going back to something that looks like, or a little bit like, what we had before," Powell told a panel that included European Central Bank President Christine Lagarde and Bank of England Governor Andrew Bailey.
North American Bancard, LLC, (NAB) a U.S.-based leader in electronic payment solutions, is pleased to announce that it has been honored by TSG in its 2022 “Best of Breed” API Awards. “The future of the payment industry demands that Integrated Partners have the best interfaces and support,” said Jim Parkinson, Chief Experience Officer at NAB. “They want to integrate quickly, access superior functionality, and have development patterns that make their work easy. This award acknowledges that we have built an industry-leading product that addresses the needs of the Developer Community.”
Financial technology leader FIS® announced the launch of its Guaranteed Payments solution, becoming the only payments processor to offer a fully integrated solution designed to guarantee merchants increased eCommerce transaction approval rates and eliminate the financial liability of chargebacks due to fraudulent purchases. According to a recent survey, 9 out of 10 merchants lost revenue through payment fraud in the last year.
Mastercard and Paysafe announce the integration of Mastercard Send into Paysafe’s payments platform, enhancing the payout capabilities offered to Paysafe’s merchant customers in the UK and EU. The addition of Mastercard Send is the latest extension of the ongoing global relationship between the two companies which supports multiple Paysafe products and services.
The accelerated use of digital payments has created more options for diners, but also complexity and cost for restaurants. Eliminating this headache, Oracle announced the Oracle Food and Beverage Payment Cloud Service. With the service, restaurants in the US can now accept the latest in contactless payment options, including debit/credit cards and Apple Pay, Google Pay, and Samsung Pay, without hidden fees and unpredictable costs.
Marqeta, the global modern card issuing platform, announced a significant expansion of its credit platform with a new, intuitive dashboard and over 40 new credit APIs that enable customers to design, test, and launch differentiated credit card experiences. Marqeta’s credit platform provides customers with greater flexibility and control than legacy credit solutions, with customers also having the option to leverage First National Bank of Omaha (FNBO)’s leading program management and banking capabilities alongside these new features.
Worldline, a global leader in payment services, announces the completion of the acquisition of Eurobank Merchant Acquiring activities, as part of its European consolidation strategy. Eurobank Merchant Acquiring (EBMA) is a meaningful card acquirer in the very dynamic Greek market with 21% share of transaction volumes processed in the country.
The Arizona Cardinals Football Club announced Shift4, a leader in integrated payments and commerce technology, as a proud payment processing partner. Shift4 will process payments for all Cardinals ticketing transactions at State Farm Stadium, including Super Bowl LVII in February 2023 through an integration with SeatGeek.
Linnworks, a UK-based e-commerce technology company, has announced a partnership with the global leader in commerce technology and payments Payoneer to simplify cross-border and B2B transactions for their customers. The partnership will provide retailers with integrated options to receive funds and make payments with competitive currency conversions while creating an increased opportunity for online sellers to expand their marketplace offering.
Trustly, the global leader in Open Banking Payments, announces its partnership with Gr4vy, a leading cloud-native payment orchestration platform (POP). Gr4vy’s online merchants will be able to add Trustly as a payment option, bringing even more flexibility and convenience to their customers. Gr4vy’s cloud-native POP capabilities enable merchants to streamline and manage payment methods, services, and transactions all in one place.
Aliaswire announced the general availability of new invoicing and payment capabilities for manufacturers and distributors in its DirectBiller® platform. The advanced features address the unique requirements of business-to-business (B2B) customer relationships and transactions in manufacturing and distribution. The announcement comes as Aliaswire builds on strong momentum in the segment.
