Snippings

Apple has launched high-yield savings account (at 4.15%) in partnership with Goldman Sachs. The account, which offers a higher rate than Goldman’s own offerings, is FDIC insured and consumers can fund it from their Apple Cash balances or directly from a linked bank account. Why would Goldman Sachs (which has just reported a 19% decline in first-quarter profits on weaker revenue, higher expenses and a $470 million loss from selling some of its consumer loans) do this? They have no choice: it is the future of banking.

The techfins are more than happy to have banks, for example, do the boring, expensive and risky work with all of the compliance headaches that come with it. Big Tech does not care about the manufacturing of financial products, what it wants is the distribution side of the business. Given that they have no legacy infrastructure (e.g. branches), their costs are lower and the provision of financial services helps to keep their customers within their ecosystems. As I wrote back in January, it is very easy to imagine a future where you use an Apple checking account (actually provided by JP. Morgan) and an Apple credit card (actually provided by Goldman Sachs, whose consumer credit division lost more than a billion dollars last year primarily because of the Apple Card) and an Apple loan (actually provided by Wells Fargo) to buy your Apple glasses, then Apple will have a very accurate picture of your finances. A very accurate picture indeed.

You can see why brands are looking at the world of embedded finance. First of all, it is growing. An FIS survey of 2,000 executives at firms across markets found almost half saying that they will invest significantly in developing embedded finance products in 2023 in response to the consumer for financial services that do not interrupt their journeys and their brand experiences. Apple are of course masters of the brand experience and the attraction of financial services (going well beyond savings) in their ecosystem is obvious: It’s easy. But there are other brands who could be just as successful. Amazon, for example.  Amazon, just like Apple, know a lot about me (including where I live) 

 

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And Apple’s savings account is hardly the best out there, either. Bankrate puts it at number 11 on its list of best interest rates. UFB Direct offers a savings account with more than a 5% annual percentage yield. Vio Bank and CIT Bank offer 4.77% and 4.75% interest rates.

But those aren’t household names.

Ted Rossman, a senior industry analyst at Bankrate.

“The fact that Apple is involved makes it news,” said Rossman. “High-yield accounts have been available for a while, but this makes them more mainstream. From an industry perspective that’s notable and may incentivize some change.”

From Premarket stocks: Apple is giving banks a run for their money | CNN Business:

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Jennifer Bailey, VP, Apple Pay and Apple Wallet, says: “Our goal is to build tools that help users lead healthier financial lives, and building Savings into Apple Card in Wallet enables them to spend, send, and save Daily Cash directly and seamlessly — all from one place.”

From Apple launches savings account.

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The key is, of course, trust.

Survey after survey shows that however much consumers dislike banks, they do trust them. The Edelman Trust Barometer for 2023, a survey of more than 32,000 people across 28 countries, shows that trust in sectors ranging from technology to food and healthcare to retailing remains higher than trust in financial services (in fact, in the survey, only social media had lower trust than financial services) so it is not really that difficult to envisage financial services delivered and the point of need by Apple and Amazon, CVS and Cigna.

Where does this leave the banks then? Well, for some of them the optimum strategy is clearing going to be delivering a regulated utility services with a high quality of service, 

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Once individuals can show up independently, with their own digital tools – digital wallets with verifiable, data, identity and digital assets – then we have something new, something special.

It’s a New. Customer. Channel.

Once a business asks for some data from a customer’s digital wallet, they have the opportunity to form a new digital connection with that customer.

From Customer Futures Newsletter: Digital wallets are the new accounts:

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What Financial Institutions are Testing Metaverse Solutions?

There are many case studies that demonstrate how the metaverse, augmented reality, and virtual reality technologies are being used by leading retail banking organizations of all sizes to improve customer engagement and provide innovative financial services.

CaixaBank: CaixaBank Group has led innovation projects such as BPI’s virtual reality bank branch and the imaginLAND space, created by imagin as a 3D replica of its physical imaginCafé.
BBVA: BBVA Valora is a service designed to help people make more informed decisions about buying or renting a property with the focus on saving time, money and stress. BBVA Valora mixes Big Data, Xamarin and augmented reality to transform the way people find their new home.
JPMorgan Chase: Chase opened an Onyx lounge in the metaverse, a virtual lounge in the blockchain-based world of Decentraland. Similar to its real-world function, the bank can facilitate cross-border payments, foreign exchange, financial assets creation, trading and safekeeping.
Bank of America: BofA is the first financial services firm to launch virtual reality (VR) training in nearly 4,300 financial centers nationwide. This innovative training technology will allow approximately 50,000 employees to practice a range of routine to complex tasks and simulate client interactions through a virtual environment.

From Should Financial Institutions Consider Metaverse Solutions?:

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The European Credit Sector Associations (ECSAs) are calling on the European Union to re-examine clauses in legislation on the proposed European Digital Identity Wallet that appear to imply that “widely used cards and payment specifications” will have to accept the wallet for strong customer authentication (SCA) for payments “on a mandatory basis”.

The European Banking Federation, the European Association of Co-operative Banks and the European Savings and Retail Banking Group — which are jointly known as the ECSAs — say that they welcome the “wide scope of usage” laid out in the current wallet proposals, but are concerned that including payment systems in the wallet’s infrastructure would require “huge investment, not only in the financial sector, but also for the overall acceptance network”.

“This could possibly result in disproportionate costs for merchants and service industries that accept card payments in accordance with the second Payment Services Directive (PSD2),” the European Banking Federation says.

From European banks call for rethink on incorporating payments into EU digital identity wallet proposals • NFCW:

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Security and compliance of transfers is issued through the management of onchain identities.

From ERC-3643: T-REX – Token for Regulated EXchanges.

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The Identity Registry Storage stores the identity addresses of all the authorized investors in the security token(s) linked to the storage contract i.e. all identities of investors who have been authorized to hold the token(s) after having gone through the appropriate KYC and eligibility checks. The Identity Registry Storage can be bound to one or several Identity Registry contract(s). The goal of the Identity Registry storage is to separate the Identity Registry functions and specifications from its storage, this way it is possible to keep one single Identity Registry contract per token, with its own Trusted Issuers Registry and Claim Topics Registry but with a shared whitelist of investors used by the isVerifed() function implemented in the Identity Registries to check the eligibility of the receiver in a transfer transaction. A detailed description of the functions can be found in the interfaces folder.

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The rapid advent of artificial intelligence has set off alarms that the technology used to trick people is advancing far faster than the technology that can identify the tricks. Tech companies, researchers, photo agencies and news organizations are scrambling to catch up, trying to establish standards for content provenance and ownership.

From See How Real AI-Generated Images Have Become – The New York Times.

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IN THE NEVER-ENDING battle against online impersonation scams, the professional social media platform LinkedIn announced today a set of new verification features that enable users to authenticate aspects of their identities and job histories. Crucially, users will now have a few different options to verify their identity and current jobs on LinkedIn. That way, if someone tries to make a copycat LinkedIn account, there can be clear differences between the imposter account and the verified profile.

From LinkedIn Verification Now Lets You Verify Your Job and Account | WIRED.

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How about just over £12m? Well, that’s exactly how much an anonymous bidder paid for the Dubai-based ‘P 7’ plate a few days ago, setting a new world record in the process.

From This £12m number plate has set a new world record at auction.

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LinkedIn facilitates verification in three ways that are all free to individual users. The most low-key option launching today is to verify your current employer by receiving a security code on your work email and entering it into LinkedIn. The social media platform has recently been piloting this work email verification feature with a small group of companies.

The second option is to verify your identity on LinkedIn through the airport security service Clear. The authentication company will take your United States phone number and government-issued ID and use the information to verify your name. You have to weigh whether you want to trust a third party like Clear with your personal data, but the option might be particularly appealing if you already use the company for travel verification and they have your data on file anyway.

The third verification feature allows users to confirm their name and current employer through the Microsoft Entra Verified ID credential, a workplace identification platform Microsoft launched last year. This option will have a slower rollout, and it will be available at the end of the month to employees at a few dozen pilot companies that are already enrolled in Entra.

From LinkedIn Verification Now Lets You Verify Your Job and Account | WIRED.

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The companies described their video, which features a stamp identifying it as computer-generated, as the “first digitally transparent deepfake.” The data is cryptographically sealed into the file; tampering with the image breaks the digital signature and prevents the credentials from appearing when using trusted software.

From See How Real AI-Generated Images Have Become – The New York Times.

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