Snippings

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global revenue per non-cash transaction has gradually declined—from $1.88 in 2016 to $1.30 in 2021—as the pool of electronic transactions has grown faster than absolute revenue.

From Next moves in the global payments ecosystem | McKinsey.

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In some markets the sending of links by banks in SMS and e-mails has been banned outright.  We would welcome such action in the UK.

From Five principles for tackling Authorised Push Payment Fraud.

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A recent SAS-sponsored study from Economist Impact looked at scenarios for the banking industry in 2035. In one of these, they focused on banks using digital transformation to “rehabilitate” their image through strengthened data privacy and cyber fraud safeguards, greater transparency and consumer protections. In this world, open banking is the basis for partnerships that to bring together all of the different facets of customers’ financial lives in personalised offerings. This is, I think, realistic and it aligns with my own view that the sector will shift way from providing individual financial services to delivering financial health.

What caught my attention was the mention of greater transparency though

 

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The impact of encrypted open books and triple entry working together in this way could be huge, because the transparency and automation means that we will no longer need to wait until the end of the reporting period to conduct an audit and produce results with the help of skilled financial professionals. Instead we will find ourselves in an era of ambient accountability, where the technological architecture means constant verification and validation. If you want to check whether a bank is solvent before you deposit your life savings there you will do it using an app on your smart phone not by looking at a year old auditor’s report covering some figures from a year before filtered through levels of management.

(Ambient accountability is a term that I borrowed from architecture to describe this infrastructure. It describes perfectly how transparency can transform the financial services industry and serves as a rallying cry for the next generation of financial services technology innovators, giving it a focus and raison d’être beyond shifting private profits from banks to technology companies and other third parties.)

Since the regulators will be able to use the technology, they will be able to spot unusual or inappropriate activity. What’s more, the information stored in the ledgers in encrypted form has been put there by regulated institutions so should there be a need to investigate particular transactions because of, for example, criminal activity then law enforcement agencies will be able to ask the relevant institutions to provide the keys necessary to decrypt the specific transactions. In this way the shared ledger can bring the technology of open book accounting to bear to exploit the beneficial transparency of the shared ledger in such a way as to preserve necessary privacy.

In a paper I co-wrote a few years ago with Richard Brown, then at IBM, and Consult Hyperion colleague Salome Parulava [published as “Towards ambient accountability in financial services: shared ledgers, translucent transactions and the legacy of the great financial crisis.” Payment Strategy and Systems 10(2): 118-131 (2016).], we borrowed the term “translucent” from Peter Wayner to mean transactions that are transparent for the purposes of consensus (in other words, we can all agree that the transaction took place and the order of transactions) but opaque to those not party to the trade or the appropriate regulators under the relevant circumstances.

From The Transparency Machine | 15Mb.

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In the world of ambient accountability, whether it is Wirecard, Enron, Tether or anyone else, nobody will be required to rely on the word of auditors because they can simply calculate for themselves whether the company is solvent or not. No more relying on tips and whispers to find out whether the money in some remote bank account is sufficient to cover the liabilities in other jurisdictions: cryptographic proofs will replace auditing and apps will replace auditors.

From Most Blockchain Pitches I Hear Make No Sense, Yet I’m Sure That Blockchain Will Transform Business.

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“Credit cards are one of the most expensive means of payment for merchants,” said Luciana Brasil, a partner at Vancouver-based law firm Branch MacMaster LLP, which worked on the class-action lawsuit that led to the settlement.

Canadian merchants may see rebates after fee settlement with Visa, MasterCard deal
Customers love paying with cards because “they get their points, their rebates, their benefits,” she said, “but they rarely ask themselves who’s paying for that.

“In reality, the more benefits those credit cards give the consumer, the more expensive they are for the merchant to accept them.”

From Paying with a credit card? Expect to see a fee when you shop under new rules that start now.

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Meta said in a statement the company was “confident that the metaverse is the future of computing and that it should be built around people”.

From Zuckerberg’s metaverse rush pauses for ‘quality lockdown’ | Financial Times.

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The new rules won’t be a free-for-all, as starting Thursday, merchants must give card providers 30 days’ notice of their intent to start charging a fee. They must also make it clear to customers at the time of payment that there’s a surcharge, and it can’t be more than they pay themselves. Finally, the surcharge will be capped at 2.4 per cent. But the rules won’t be in force in Quebec, because that type of fee is forbidden under the province’s Consumer Protection Act.

Telecom provider Telus has already warned its customers that they’ll have to pay a surcharge of about $2 per customer on average starting this month, if they pay their bill with a credit card. And more and more businesses are likely to do the same soon.

From Paying with a credit card? Expect to see a fee when you shop under new rules that start now:

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The UK will scrap the General Data Protection Regulation (GDPR), the European Union’s data privacy regime, and replace it with an alternative system in the UK, the digital and culture secretary Michelle Donelan has told the Conservative Party conference.

Donelan said the proposed new system, details of which have not yet been revealed, will be simpler and clearer for businesses to navigate.

From GDPR to be scrapped in favour of UK data privacy regime:

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ABN Amro is bundling digital ID with payment functionality to speed up the onboarding process for consumer-to-business transactions

From ABN Amro introduces e-ID with payment functionality.

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This bill would authorize a county recorder to, upon request, issue a certified copy of a birth, death, or marriage record issued pursuant to those provisions, in addition to the required method described above, by means of verifiable credential, as defined, using blockchain technology, defined as a decentralized data system, in which the data stored is mathematically verifiable, that uses distributed ledgers or databases to store specialized data in the permanent order of transactions recorded. The bill would require the county recorder to ensure that the release of those copies is subject to technical safeguards sufficient to prevent fraud and unauthorized or illegal access, destruction, use, modification, and disclosure.

From Bill Text – SB-786 County birth, death, and marriage records: blockchain..

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That’s where a little-noticed but long-running push to develop offline digital payment systems comes in. Some of this work goes back 30 years, to a time long before smartphones. In fact, the future of offline central bank digital currencies (CBDCs) may lie in the technological past.

From Taking Digital Currencies Offline:

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