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Money has a few traits that are not shared by water / electricity viz. local currency, legally obtained versus ill-begotten, and so forth. These differences are responsible for at least a part of the feasibility, friction and fees involved in cross-border worker remittance. On second thoughts, even electricity exhibits some of these differences e.g. 120V/60Hz in the USA versus 230V/50Hz in the UK. Not sure whether it's even feasible to transmit electricity seamlessly between such places with dissimilar specs.

In most jurisdictions, when a bank opens a business account, it is required to review the company's incorporation documents including Articles of Association and Memorandum of Association. If they say an applicant is a bullion trader, then he is and the bank has to accept it. Unless I'm missing something, I fail to see how it's possible for a money launderer to masquearade as bullion trader even under the present KYC framework.

KYC imposes so much friction as it is. So-called KYCB and KYCR will exacerbate the situation even further without adding proportionately to risk mitigation. I remember a banker recently lamenting "no transaction, only compliance" in the context of KYC for Business Correspondents involved in financial inclusion. End of the day, like any other business, banks cannot follow a risk avoidance policy. Putting more and more hurdles to doing business in pursuit of risk avoidance will neither help banks nor their customers. 

Then they should stake a claim for "agile banking" a la 'agile development' in software! 

@DirkK: 

Thanks. I just realized that the title's too long to comply with Finextra's size spec. I'll have to think of something else then. 

"social media are not considered by consumers to be main methods of communication".

Too bad they don't. As I'd pointed out in a recent Finextra comment, a lot more can happen with a 140 character tweet than a call lasting 140 seconds / minutes. If consumers are not totally comfortable with Twitter alone, they should try it along side the telephone. They might then realize that you can achieve a lot more with a call and a tweet than with a call alone, to paraphrase a famous saying by Al Capone.

The last five years of gloom has come on the back of the previous five to seven years of boom. Just taking real estate as one example, it's evident that the man on the street benefited as much from the boom as he is suffering during the gloom. As far as I know, not a single American bank has been charged with any criminal wrongdoing, so I won't blame banks singularly for what happened during the GFC. While their bonuses might seem oversized to a common man, they were not hidden from their shareholders. Going by the recent rejection of Vikram Pandit's compensation package by Citi's shareholders, it looks like shareholders have finally woken up.

Barclays' PayTag comes quite close to the Asian functional and lateral-thinking approach of smartcard plus duct tape. British tribute to Moreno, maybe?

@DirkK:

Bulk order, nah, although I won't mind one Royal Wedding ashtray!

Nice post. Social media customer service is one more trend I've noticed. While it's offered by corporations, it's arguably of greater benefit to their customers. I hope it adds some value to corporations since I'd hate to see them pulling the plug on this initiative. Recently, I'd an issue with a certain bank and needed to contact its customer service. By the time it'd have normally taken me to log to its Internet Banking portal and contort my mind far enough to be able to select one of the options given in its drop down box, I was able to send an @ tweet to this bank, get its reply, and have my issue resolved. Great experience. Let me not even think of comparing it with the alternative of telephoning the bank's Customer Care.  

I've been planning to write this and a few other social media service examples up as a blog post (Title sneak preview: "Customers of the World Unite, You've Nothing to Lose But the Call Center Hold Music"). But, apart from one bank, all other examples come from non-BFSI industries. If Finextra permits a post that crosses BFSI and gets into other industries, I'll be happy to publish it on Finxtra.

SQUARE disrupted the card acceptance space by obviating the need for businesses to have a merchant account. Although there could be a difference between a typical SQUARE merchant and the "vendor" mentioned in your context, it seems that getting a merchant account is not easy. This could prove to be the biggest hurdle in the way of vendor enrolment to virtual card programs. (Assuming, of course, that a merchant account is required to accept virtual card payments). Furtheremore, this challenge lies outside the purview of the payer and the vendor. Any light you can throw on how it can be surmounted it will help.

As a channel, eBill might be new but the basic concept of reminders is old and Billers could've practised it for all these years via telephone, SMS, and other channels. However, despite all their lip service towards customer satisfaction, consumer advocacy and so forth, I don't recall the last time I received a reminder from any biller to pay before the due date. Looking at their business model, I'm not surprised: After all, Banks, Utilities and many other types of Billers make a lot of money for delayed payment e.g. credit card late payment fees and interest charges, electricity connection reinstatement charges, etc. Therefore, eBill reminder might have legs but only for the opposite business model: Billers will use it and consumers will pay for it.

On the other hand, DSO reduction has a strong value proposition. Billers might be willing to pay for a suitable functionality - rather than eBill reminder - that delivers this benefit more directly.