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 /  News  /  10 May 2019

Weekly News Digest 10 May 2019

Bank sign
Weekly News Digest 13 September 2019
UK banks' PPI hit | Stripe doubles down on lending | Netherlands instant payments launch | Aus neobanks are go | UK regulator considers industry data
Weekly News Digest 6 September 2019
Pay-by-hand at Whole Foods | facial payments in China | changes at the ECB | UK challenger bank growth
Credit cards
Weekly News Digest 30 August 2019
US credit cards market reaches $900bn | Buy Now Pay Later market booms | China plans state-backed cryptocurrency | India's banking robots | QR code disruption
Goldman Sachs office
Weekly News Digest 23 August 2019
Goldman issuing | Volcker reform | low-rate dominoes | ANZ challenges | DBS plans credit card for India
US credit cards
Weekly News Digest 16 August 2019
US consumer credit delinquency grows | Venmo boosts instant payments | NatWest trials voice banking | TransferWise launches in Australia and New Zealand
Weekly News Digest 9 August 2019
Mastercard buys Nets' RTP | Heidelpay to KKR | Klarna soars while GreenSky dips | Apple Card launches | European bankers chafe at ECB rate
Fork in the road
Weekly News Digest 2 August 2019
BofA exits First Data JV | Citi at crossroads | Mastercard soars | European banks' 2Q | Indian cashless MSCs
Federal Reserve 2
Weekly News Digest 26 July 2019
Competition in US real-time payments | Deutsche Bank losses | Nationwide hikes overdaft charges | RuPay launch to boost credit cards in India?
Wall Street image
Weekly News Digest 19 July 2019
Consumer banking drives profits | Big Tech in payments | WhatsApp ready to join India's crowded payments market? | Challenger banks in Australia
Shopping bags
Weekly News Digest 12 July 2019
Revolving credit reaches YTD high in US | Volcker Rule 2.0 | Britain eyes future of payments | Australia bank capital buffers | Push mobile payments in Japan
Weekly News Digest 5 July 2019
POS-financing draws global schemes | Spanish banks prepare domestic card | Australian Open Banking era begins
Beacon light
Weekly News Digest 28 June 2019
Regulators scrutinise Libra white paper | Bank of England mulls liquidity for fintechs | Citi trims perks on credit cards

Credit card lending in the United States has been enjoying life in sunny uplands of late, buoyed by historically low unemployment numbers and popular enthusiasm for products such as JPMorgan's Sapphire Reserve credit card, which continues to enthral rewards comparison gurus. But with growing charge-off rates in this market, issuers are now beginning to tighten standards, according to the Fed's latest quarterly survey of leading loan officers, which also reveals a slight falling off in demand for credit cards. It is interesting therefore that American Express, continuing its dramatic brand evolution in recent years, has relaunched the Blue Cash Preferred card, now with cashbacks for such contemporary consumer favourites as streaming media subscriptions and ride-hailing services. "The spending threshold to get the bonus is remarkably low," said one analyst quoted by MarketWatch. "It's not the biggest sign-up bonus that's out there, but it's a solid return for a relatively low amount of spending."

Staying in the US, an important battle continues to be played out in the courts, with a district court ruling that a state financial regulator can indeed pursue its case to block a federal plan to grant fintechs banking charters. At issue is whether American financial technology firms should be regulated primarily at the federal or the state level. With fifty states in the union, it would be clearly easier for the new breed to operate and scale up in line with nationwide regulations from the Office of the Comptroller of the Currency (OCC), an independent bureau of the US Treasury. Long before the current administration in Washington was even a gleam in the electorate's eye, the OCC had floated the prospect of a Fintech Charter and has since pursued authority to bring it into being. That was enough to set state financial regulators on the legal warpath, arguing that a one-size-fits-all solution would be financially risky and bad for consumers. Last August, the OCC began accepting applications from fintechs for charters, with some observers seeing it as an invitation to the likes of Amazon to establish their own banks. "The regulatory situation is much more complicated for fintechs in the US than it is in Europe, where a licence in one country can be 'passported' across the entire European Economic Area to reach over half a billion people, " commented David Hickey, head of research at Verisk Financial Lafferty Research. "Needing to apply for separate licences in each state is expensive and onerous, particularly for smaller players who don't command the resources of the internet giants."

A year is a long time when it comes to digital transformation and so Singapore's DBS, which began the process in earnest over five years ago, can afford to be somewhat sanguine as the city-state's central bank considers whether to grant licences to digital-only banks that have no bricks-and-mortar parent. As chief executive Piyush Gupta mentioned in a Bloomberg Television interview this week, "if you've already been transforming yourself then it is not very different from the models that the traditional banks use....The real challenge is if the regulators create an unlevel playing field and they let the new bank licensees come in and do banking on different terms." In other words, the Basel-driven capital and liquidity requirements must apply to all players. DBS' ongoing digitalisation has been multi-faceted, involving the retraining of over a thousand staff and the hiring of anthropologists and psychologists, among others, to make the most of data. Before taking over DBS in 2009, Mr Gupta had briefly interrupted a quarter-century's tenure at Citi to create an online portal called go4i.com in 2001. Perhaps because of this first-hand experience of internet start-ups, DBS' investments in and acquisitions of fintechs have been few and conservative: most notable might be conversational AI platform Kasisto, whose technology was put to use in the bank's mobile offering: digibank.

To end, links to some other stories of interest this week...

The Weekly News Digest from Verisk Financial Research highlights significant developments that have recently occurred in payment cards, digital payments, acquiring, processing, retail banking and consumer credit. Our writers and researchers frame these items in contexts such as historical, sectoral and regional trends, adding a layer of value that is often missing from the rolling news cycle.

About Verisk Financial Research

The market-leading online, interactive database and data dashboards covering the global cards and payments industry in detail, plus a range of data-packed country and regional reports. Leveraging Lafferty Research data going back to 2010 - and forecasts up to 2020 - our unique datasets cover 72 countries around the world and feature more than 250 metrics per market.

Find out more about Verisk Financial Research or contact us at research_enquiries@verisk.com.