Open Banking payments are on a roll - my back-of-the-envelope calculations suggest monthly OB payments will be close to 10m in May and likely to be well clear of 10m in July, reaching 14m or more in December this year.
It is a good analogy to compare the growth in OB payments with contactless, but it is a myth that UK contactless was driven by TFL in London - rather, contactless had been growing strongly for several years prompting TFL to join in with millions of contactless debit and credit cards already in circulation. See my Finextra video at the 2013 EBA Day where I observed this https://www.youtube.com/watch?v=gnqcG5mitnc (start at 2:30).
Network effects are the key growth driver in successful payment systems - more uses for the system draw in more users causing more uses to be made available.
It looks like OB payments network effects are becoming established, setting them on a course for mass UK adoption (> 1bn annual payments) over the next 2 - 3 years.
28 May 2023 14:22 Read comment
cash is the only truly inclusive financial instrument. A cashless society and financial inclusion are a contradiction. Anything that requires owning a device or registering credentials creates an immediate barrier and a vector for financial exclusion.
Digital payments are great but it is best to avoid any policies that promote or discourage cash and let the market i.e.society decide.
13 May 2023 14:12 Read comment
'AI tools will be classified according to their perceived risk level' - who makes this judgement, what qualifications are needed to make it?
I doubt regulatiors have the experience or skill to do regulate AI, simply because I doubt anyone can to do so effectively.
In reality, the best regulator is the free market - get AI to learn from the free market and who knows, maybe regulators will become superfluous.
28 Apr 2023 22:49 Read comment
2 days a week in the office is absurd - if employees are unwilling to work 5 days a week in the office they are clearly uncommitted to thier employer and colleagues. Flexibility is obviously important and desirable, but the default should be 5 days in the office with flexibility to work from home when that flexibility is needed.
28 Apr 2023 22:36 Read comment
This is policy trumping free markets.
CBDCs such as the digital Euro are as much a new payment system as they are a new form of money.
There are two approaches to introducing a new payment system - by dictat or by free markets.
If a CBDC is introduced by dictat, it is hardly a 'public good', more an imposition. Especially with the statement a digital euro makes 'European payments more resilient, enhancing competition and reducing costs'. This sounds great and pro-free markets but it is just propaganda without real evidence of market demand and market-driven problem solving and solutions.
The reality is introducing new payment systems for ubiquitous use is hard, very hard. Policy is unlikely to get it right by imposition.
Instead, policy should be an enabler for the free markets - create a CBDC by all means, preferably wholesale so it can be used as a new form of settlement collateral instead of reserves, but allow private enterprise to innovate with it, sinking or swimming on their ability to meet the market needs. Otherwise, policy will just sink.
25 Apr 2023 11:24 Read comment
This highlights the big risk of 'grands projets' in payments - if they take too long to implement they become superseded, the market moves on and competition comes up with alternatives
With neither the UK's New Payment Architecture (in planning since 2015) or the Bank of England's new RTGS (started in 2017) implemented yet, there must be a risk of a similar situation in the UK, exacerbated by HM Treasury moves to implement a CBDC at an equally slow pace.
However, in fact, it is also a great opportunity for competitive solutions with a strong product-market fit to step in to meet the needs of today's digital economy.
21 Apr 2023 12:12 Read comment
meanwhile the UK closes down its mobile payments system Paym due to lack of interest (from the baking industry)...
24 Mar 2023 08:05 Read comment
Politicians push for digital ID as it opens the door to absolute surveillance and control of the population. It is a vehicle for exclusion (for people governments dislike/fear) and intrusion instead of inclusion. A honeypot of data open to hacking and misuse. The fact that these two are advocating digital id is a sure sign it is bad idea. Their concern that when "the industrial revolution happened politics took decades to catch up with it." illustrates their hubris.
26 Feb 2023 11:23 Read comment
A more interesting metric from the OBIE is 8.45m successful OB payments in Jan 23. This is 121% higher than Jan 22, while the total for the year in 2022 (68m payments) is 171% higher than 2021 (25m payments). OB payments are demonstrating a sustained trajectory at a growth rate suggesting a billion or more OB payments in 2025. At this point, if other payment innovations are a guide such as contactless cards, the U.K. FS industry will take notice, with many saying “we failed to see that coming”. In contrast, the PISPs already driving and riding this growth will be sitting pretty.
21 Feb 2023 14:11 Read comment
Google "UK money laundering convictions" or "UK credit card fraud convictions" and results come up with cases of convicted criminals. Do the same for "UK authorised push payment fraud convictions" and there are none - it's very strange, especially since APP fraud is bigger than credit card fraud. Generally, there is a dearth of information and data on APP fraud - who is committing it, where they are from, which UK banks they target to take over accounts or open accounts, the conviction rates and so on.
All the focus is on reimbursing victims - why the silence on the fraudsters, measures to convict them and actions to prevent them?
07 Feb 2023 10:51 Read comment
EBAday
John FindlayCo-Founder at Launchfire
Timo LehesCo-founder at Swarm
Povilas RuzgailaCo-Founder at Gurupay
James LynnCo-Founder at Currensea
Nenad MarovacCo-Founder at DN Capital
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