Fintech Update, 5/27 - 6/4
May 27 - June 4, 2017
Leading Off
BoA is developing third-party data-sharing agreements similar to deals struck by Wells Fargo and Chase; several Spanish banks partnered on a cross-industry blockchain platform; Kmart suffered another data breach; OneLogin also was hacked; Bangkok-based Omise will be the first VC-backed firm to raise funding via an “initial coin offering”; and Stripe unveiled a new data analytics tool to improve payments reports.
Last Week's News
BoA working on third-party data-sharing agreements. Bank of America (BoA) is engaging with “multiple financial data aggregators to [allow] customers . . . to connect data from their accounts to third-party financial management applications.” BoA says the new effort is a “key plank in its API strategy,” and follows similar moves by competitors like Chase, Wells Fargo, and Capital One.
First Data launches AI fraud detection tool. Fraud Detect relies on AI and machine learning technology, as well as “cybersecurity intelligence and information from the Dark Web,” to help merchants detect fraudulent transactions in real-time. First Data said pilots tests have showed “lower false positive rates and an [80%] improvement in identifying fraudulent transactions.”
HSBC to roll out robo-advisor. The bank has been testing the new service using anonymous data pulled from the Financial Conduct Authority's fintech sandbox, with plans for a full launch by the end of the year. Ironically, an HSBC survey of 12,000 consumers last month found that more would trust “a robot to perform open-heart surgery than [to provide financial] advice.”
Spanish banks create cross-industry blockchain platform. Several Spanish corporations -- including Banco Santander, BBVA, and Banco Sabadell -- have partnered on a DLT platform called Red Lyra that will help “certify and validate digital identities of individuals and companies, [helping] speed the enrollment of customers for banking and other services.”
Kmart faces data security breach. The discount retailer's parent company, Sears Holdings, confirmed that its computer systems had been “infected with malicious software” after learning of “unauthorized credit card activity following certain customer purchases at some . . . Kmart stores.” This is Kmart’s second malware-based security breach in less than three years.
UN study assesses benefits of mobile payments in Kenya. The study [full text], from the UN’s Better Than Cash Alliance, found that mobile payments provide “huge benefits to Kenyan farmers, reducing costs, uncertainty, inefficiency and insecurity” as compared to cash. Survey respondents prefered M-Pesa to cash, due largely to its “transparency and convenience.”
Paytm usage is surging in India. The Indian payments firm, India’s second-most-valuable startup, is now more popular than credit cards among Indian consumers, and the company sees an opportunity to outpace cash as well. Five million merchants in India currently accept Paytm payments, and the firm has 225 million mobile wallet customers.
Visa CEO talks payments and fintech. In an interview [full text] with Sanford Bernstein’s Lisa Ellis, Visa CEO Al Kelly discussed a variety of “opportunities and challenges facing the company,” including digital payments, international regulatory changes, and growing competition from Chinese payments giant Alipay.
Have a great week!
The Fintech Update Team