Whilst all initiatives like this are a step forward, the unhealthy market control of the 4 dominant retail banks, who will always strive to continue to retain 92% of the market, will hamper (or obstruct?) the real structural changes that are required.
09 Feb 2016 10:53 Read comment
The issue of supply to create competition is simply that for an existing challenger, or a new entrant to compete, they have to partner with an incumbent. In the case of Fidor Bank, a new UK challenger, their approaches were initially declined by the 4 incumbents, thus restricting, or controlling, consumer market choice. Atom Bank, another challenger, have publically stated that a significant business risk they face is their agency bank relationship.
For others who were not declined, their relationship adds cost, complexity and an unhealthy supplier competition risk to their venture. The Telco market has some interesting parallels in the MVNO model. There the pricing structure that evolved delivered a wholesale “buy rate” that ensures competition occurred, Skype charges vs BT are an example. The consumer can easily choose. In transactional or current account banking the prices charged by the incumbent providers are substantially higher than the payment scheme fees that they are charged. This ensures that their agencies charges for consumer current account services are substantially higher than their own, which was highlighted during the ongoing CMA process.
21 Jan 2016 14:50 Read comment
I believe that this issue is deeper, and that the profound lack of choice is also a deterrent.
Of 45 Building societies in the UK only 5 offer current account services, yet those 40 societies manage normally the largest financial transaction that a consumer undertakes, and then they fail to manage and support their day to day finances. Agency Bank restrictive practices from the 4 incumbents that throttle competition coupled with complex and expensive IT also have a part to play in the lack of consumer choice, and the consequent failure to stimulate trust in change.
When people in the pub chatting are able to say I moved my account today because my new provider checks my regular payments and fixes any overcharging for me (Mondo perhaps?)... a new, truly competitive and transparent market will have at last arrived.
21 Jan 2016 11:06 Read comment
Spot on David and I also get asked avery day about this. Whilst some aspects are interesting just "talking" a new technology does not create a platform that consumers trust and Banks and Central banks will universally adopt to replace say SWIFT etc?
20 Jan 2016 10:31 Read comment
Post the 2007/8 financial crisis the Australian Financial Services Regulator adopted a process called SARAH to deal with the meltdown.The words behind the acronym are Shock, Anger, Revenge, Acceptance and Help. Perhaps, ahead of others, Santander has finally reached the acceptance piece, and help is at hand, possibly via their incubator.
28 Sep 2015 12:00 Read comment
WirePay? Apparently when Fedex and UPS were exploring a link up they failed the branding merger discussion as "FedUp" didn't seem a good outcome. At least Wirecard and WorldPay both start with a W and have 8 letters so a game of scrabble with a number of players seems inevitable. In 2010 at the start of the regulatory change period, opportunities abounded, as we shared with RBS at the time. Now in 2015 with interchange and retailer pressure there significant challenges. It will be really interesting to hear more of the plans the other players around the table may have, or, to read the market risk section of a possible IPO document?
Nick Ogden
Founder
WorldPay
27 Aug 2015 09:33 Read comment
This is excellent news.
I have tried for a number of years to shake this market up and been actively prevented from doing so. Now a fully transparent review, followed by the appropriate remedial action should ensure that banking changes that all UK business demand may at long last occur. These changes can only have a positive impact of the economy as a whole. UK SME's waste over £1bn in paying for Bank services every year, and for them to be able to re-invest those savings in employment and growth now would have a profound effect that would benefit everyone in the UK.
06 Nov 2014 11:22 Read comment
Most new entrants require "partnerships" and often that is the first hurdle. Be that for card acquiring for an e-money service where fickle risk staff are not known for their consistency of approach, and a change of mind in their business can have a devastating effect on a start up, to access to core banking services. In this area remittance is an obvious example of challenge, where costs for end user customers are now being driven up and competition (read servicing the underbanked) is being "closed down".
In reality post the crash of 07/08 and with the arrival in the EU of the PSD in 09, and 2EMD,the legal framework for change existed but the “old industry fudge and handcuffs” remained firmly in place. In the UK at least the Competition Authorities are going to start a review, and I really believe, address some of the wider issues, in tandem apparently with an alternative practical solution that has already started to wind its way through the regulatory processes.
18 Jul 2014 14:48 Read comment
The new Payment Banks who serve "businesses only" create new opportunities in SCF for the customers they serve. For example, a Payments Bank could act as a lending facilitator, not as a principal, and enable its customers to "auction off" their supply chain receivables on a regular basis, as well as other financing requirements they may have, to obtain the best terms. The competitive tension that this approach introduces should reduce cost and may encourage or stimulate much needed economic growth, given the lack of credit from that is available for "general working capital".
05 Jun 2013 10:44 Read comment
Keith your are indeed correct. However, cash is about to get an audit trail! The changes to the Electronic Money Directive (EMD) that come into effect on the 30th April 2011 have already contemplated this and there will be systems available in the UK very shortly that can deliver this, so watch this space…
08 Oct 2010 14:26 Read comment
Jonathan RosenneChairman at QSM Programming Ltd.
Ken ArcherChairman at Gresham Computing Plc
Peter JonesChairman at PSE Consulting
Viet Anh Phan TonChairman at Pontus Systems Technology Pte Ltd
Andersen ChengChairman at Post Quantum
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