A library of snippets
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Future applications of this technology will in all probability not be used to unlock smartphones, thought that cannot be ruled out. The group behind the work sees loads of potential for it when it comes to high-security settings, where a restricted number of authorized users need ultra high-level access.
From Researchers can accurately identify people using their brain waves
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A Scottish Council has given local government workers the power to create fake Facebook accounts, befriend citizens and spy on them for the prevention of “disorder” and “perceived mischief”.
From Local Government Approves ‘Covert’ Spying On Citizen ‘Mischief’
As I am very fond of repeating, yes in cyberspace no-one knows you’re a dog but on the other hand no-one knows you’re from the FBI either.
I happened to be talking about APIs at a client event today, and got involved in a discussion about how the fintechs might begin to work with banks in the new world of PSD2 and mandatory APIs. This has been subject of great interest to me at the recent Money 2020 Europe (with top, top players like Shamir Karkal from BBCA and Alex Mifsud from Ixaris explaining why the move to APIs will mean a big shift in the delivery of banking services) and other recent events. Generally speaking, and this is a sweeping generalisation, I think there has been a shift in European bank thinking in recent times. They well understand that if they do nothing, then in the instant payments, API-centric, PSD2 world they stand to lose significant income. The outsourcing company Accenture, for example…
estimates that the new new breed of payment initiation service providers will erode 33% of online debit card transaction volumes and 10% of online credit card transaction volumes resulting in a total market share of 16% of online retail payment volume by 2020.
From Banks set to lose 43% of retail payments revenue under PSD2
So the Payment Initiation Service Providers (PISPs) stand to capitalise on the new arrangements (if the banks do nothing, of course). What kind of services might they provide? Well, an obvious example is integration with social media. If you look at the use of instant payment applications in the UK (PingIt and PayM) it is far less than the use of, for example, Venmo in the USA. And Venmo doesn’t deliver immediate settlement (it works through the debit card networks). In the last quarter of 2015, Venmo transferred $2.5 billion. In January 2016 alone it transferred $1 billion. So why is it so popular? It’s the integration with social media. Just over half the users are 18-24 and half the payments relate to food and drink sharing! On a US college campus, “I’ll Venmo you” has entered the lexicon. In the UK, “I’ll PingIt you” has not. Paym is growing steadily, but it is still only transferring about £12 million per month.
So now imagine, post-PSD2, a combination of the immediate availability of funds like PingIt and Paym with the social media integration of Venmo. It will be a wholly different payment experience. I’ll give you an obvious example. My wife and some of her friends are planning a weekend break in August. They do this through a Facebook chat group. But when it comes to settling up for hotels and air fares, everyone has to log out, e-mail everyone for their bank details and log in to home banking and set them up as payees, then make the payments. Then everyone else has to log in to their bank accounts to see if the money has arrived and that it is the right amount. In 2018, however, it will all be different. Facebook will be integrated with instant payments through APIs so that it can function as a PISP. When my wife gets a message to say that she owes her friend £100 for her air ticket, or £25 for her share of the dinner, or £10 for the tickets to a show, then she will put money into her return message just as she adds emoticons today. Under the hood, Facebook (which of course knows the bank account of the person you are sending a message to) will initiate an instant payment and within a second or so her friend will get a message to tell that the money has arrived. Remember, Facebook already do this is in the US through debit cards (like Venmo).
It’s not all about payments though. The other category of organisation with direct access to the bank account, the Account Initiation Service Providers (AISPs) also stand to benefit from bank inertia. The row about “screen scraping” in the US adumbrates similar pressure for bank strategies in Europe.
JP Morgan Chase CEO Jamie Dimon is incensed about fintech startups like Mint, Acorn and Bloom “scraping” his customers’ data
From Banking App Competition; Why OTT “Skinny Bundles” Fail | AdExchanger
I’m sure his experienced strategists will be quick to reassure him that third-party access to bank accounts (the data is the customers, not the banks, of course) ought to be seen to be an opportunity for JP Morgan Chase to develop some terrific new products and services. The reason why customers of JP Morgan Chase use Mint is because JP Morgan Chase do not provide a suitable, better product for them to use instead. Mr. Dimon, as a champion of free enterprise, would surely object to organisations building walled gardens and using regulatory barriers to defend them. If Facebook or Amazon provide a better financial services app for customers to manage their JP Morgan Chase accounts, then good for them.
In fact, it seems to me, that this is a very likely outcome of rational market evolution. I buy my electricity from whichever supplier offers the best deal for our household. When I change suppliers, I don’t need to change my TV. When I change banks, why should I change my digital wallet if I don’t want to? With a standard API, might personal finance management (PFM) app and my wallet app and my social networks will all access my bank account, whatever my bank. And if I change banks, whatever.
So… what makes sense for banks? Why bother making the wallet or PFM apps? Why not instead provide the best possible API to people who are better at making these apps. Why bother with PingIt and PayM? Why not instead provide the best possible API for PISPs to use. Why bother with fancy applications at all? Why not instead provide the identification and authentication services that all of these other apps will depend on. After all, if I’m going to give Facebook access to my bank account then Facebook need to be pretty sure that it’s actually me and I need to be pretty sure that it’s actually Facebook.
The rigorous KYC procedures at US banks
the New Jersey-based crime ring created more than 7,000 fake identities to get tens of thousands of credit cards
From Woman Gets 3 Years for Role in $200M Credit Card Fraud Scam – ABC News
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The U.S. dollar is the preferred currency in Zimbabwe at present, but others are welcome. “We are saying that since you can import/export goods from South Africa you can use the rand. If you are importing from China you can use the yuan. The U.S. dollar is our reserve currency,” explained Mangudya.
Implementing cashless systems in Africa 04:03 Zimbabwe seems years away from reintroducing its own currency. In the meantime, it has coins called bonds. For each coin in circulation there’s an equivalent U.S. dollar coin held in reserves. There are over $13 million worth of these coins in the country, CNN was told, but recently banks have started printing “bond notes” representing U.S. dollar values up to $20, due to a cash shortage.
From The ‘worthless’ 100 trillion dollar bank note – CNN.com
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According to some other forecasts, wearable payment transaction volume will grow from $3.1 billion in 2015 to $501.1 billion worldwide by 2020. By that time, wearable payments will represent approximately 20% of the total mobile proximity transaction volume and about 1% of total cashless transactions in retail.
From What is The Next Big Thing in Payments? | Let’s Talk Payments
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The mining of bitcoin is a security service that alone creates no wealth
From Bitcoin and the costs of consumption – Dr. Craig Wright
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ECB has decided to discontinue production and issuance of €500 banknote
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My good friend Wendy Goodman was kind enough to write about her experiences at Tomorrow’s Transactions this year (our 19th annual Forum!!) referring to it as
Tomorrow’s Transactions Forum, Dave Birch’s quirky annual event where ideas about the future of money are smashed together like particles to see what happens.
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there is no reason why, in principle, central banks could not offer online digital money accounts for the public
From MacroMania: Monetary policy implications of blockchain technology
This is, essentially, what the first central bank did. The Bank of Amsterdam (the Amsterdamsche Wisselbank, founded in 1609) was, essentially, a municipal bank that provided a reliable and trusted payment mechanism. It did not lend money: it was there to make account-to-account ledger transfers. It had an important difference to previous experiments in the same direction: legal restrictions on settlement outside of the bank. The Amsterdam merchants were forced to open accounts there because of the law demanding that commercial payments had to be through the bank. They could deposit all sorts of different coins to credit their accounts and then make payments by instructing account-to-account transfers. The result was that Amsterdam supported a vibrant commercial marketplace with access to safe, efficient and cost-effective payments. This in turn supported the evolution of the Amsterdam bourse and helped to make the Netherlands rich.
So we are back the “big problem of small change”. How can private companies provide a circulating medium of exchange and still make a profit on it? It’s possible that they can because of new business models. But suppose they can’t? Suppose it falls to the central banks to provide the digital money for everyday use. As we discussed before, one of the objections to this
Snippings