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If Diebold Nixdorf is serious about the convergence of Banking and Retail, one has to wonder why Diebold Nixdorf has a VP of Banking and a seperate VP of Retail.

Why would anyone expect the likes of Amazon to use the same business model in banking as they do in retail?  To the best of my knowledge, Virgin Money isn't run like a train operator - or is it? The reality is that Richard Branson is selling the Virgin name, not re-applying business models.

The fact that it hasn't happened yet is not proof that it isn't going to happen in the future, and the problem with pundits is they have a tendency to get a bit too excited a bit too soon.  It's going to happen, but the tech giants are going to cherry pick; the banks are going to be left with what's left.   

I think there are two things to consieder here.

The first is the fact that banking does not require much in the way of a physical presence in the High Street in order to operate the majority of its services - sad, maybe, but true.  This means that, for the tech giants (and the smaller newcomers), delivering banking services to banking service consumers is little more than an extension of their existing consumer-focussed services. 

The second is that suppliers into the banking industry are selling banking software to supply banking services to banking service consumers, but those consumers are evolving.  Few suppliers of banking services to the banking industry are extending their portfolio of offers over the banking service ringfence into consumer-focussed complementary services, even though there is a demand for such things from the banks.

I hear only the other day, a senior manager in a major banking services provider tell me that the banks were only interested in payments and making payments more cost effective.  Such short sighted ignorance inevitably leaves the banks playing into the hands of Amazon.       

Is this really a probem for the banks?  If the victims were defrauded out of cash in thier wallets - by scams of a similar nature - it would not fall to the banks to refund.  Indeed it would not be seen as a banking problem at all.  

So, if this is not a direct banking problem, the problem lies in the gulibility and therefore the vulnerability of bank customers, but the problem is exaserbated by the speed at which bank balances can be expropriated and transferred.

The development of real-time banking services has fueled the development of fraud vectors focussed on social engineering mechanisms.  

A victims fund finaced by a payment tax is not the answer.  The answer must lie in modifications to the ecosystem to reduce and limit the opportunities for fraud, but this has a cost.  There are solutions but fraud prevention has never been a headline grabber.     

I don't get it.

Banks should accept a certain amount of small errors ... 

I would like to believe that if I sent someone a big chunk of money, there was a good chance that all of it would get to them!  I am not sure that I would accept a bank that accepted small errors!!!

@Padraig, not sure what you mean by "direct account payment" but since Apple Pay is about NFC, I am assuming that you mean providing an alternative to the contactless debit card.  If this is the case, then Apple certainly is not a competitor, Apple is a facilitator - and Apple does charge for the service.  

The problem that Apple has (and so do the others) is that, for the majority of consumers, the thrill and excitement of making a retail payment with a mobile phone doesn't come close to repaying the technical debt incurred in setting it all up.  The same goes for the banks: in order to serve their customer base effectively, a bank electing to support Apple Pay also needs to support Android Pay and Samsung Pay and Windows Pay and ...

Apple have already engaged with the global card schemes to make this thing work, which is technically sound but of limited consumer appeal or as you say, "underwhelming".  I don't hear of that many people demanding the banks support Apple Pay, but I do envisage consumers using an NFC payment facility as part of a wider, more engaging, smartphone banking app offering, but what's the point for the bank if it doesn't work on the iPhone?  

The history of Apple Pay take up clearly shows that Apple isn't in the driving seat in this car.  

This is indeed a problem.  If Apple continues to restrict access to NFC for the banks, then any bank app that uses NFC is primarily restricted to Android, which means that the banks are only able to deliver services to a subset of their customers, which is restrictive for the banks and far from ideal for the customers.  Apple, however, have the same problem: they can't expect to be in a position of world payment domination unless they are able to reach all of the people who want to make a payment with a phone.  Without a doubt, they need the banks, but given that, they still need to reach those people that do not have an iPhone!  The reality is that Apple do not have the answer ...

Isn't this, as is usually the case, something of a red herring?  Back in the dark ages when we all used magstripe cards, it was clear that transaction security was well and truely embedded in the use of the PIN.  In those times, it was safer and threfore in the best interests of all to route transactions via a network that was able to support online PIN, and therfore PIN transactions were worthy of a reduced rate.  Now that we all live in the 21st century, with the magic that is EMV, the real security no longer no longer rests with the PIN.  Since it is not possible to clone a chip card without the clone being detected as countefeit, which clearly is not the case for magstripe, the PIN becomes a nice-to-have bolt-on - the only risk then comes from pre-status fraud, which in the big scheme of things is minimal.  Interestingly, all the rules around routing of debit transactions and thir dependence on the PIN is really legislation for a bygone age.  What we see here is little more than a gravy train for the lawyers.

Have they really lost the Security Codes?  Schoolboy error ...