Than a Year Has Passed Since Three Giant Mergers Promised to Change the Payments World
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More than a year has passed since three giant mergers promised to change the payments world. Change has come, but not where many expected to see it. Volume Eighteen, Number Two • DigitalTransactions.net • February 2021 ALSO IN THIS ISSUE: Walmart’s New Fintech An Upshift for Parking Apps Ransomware Runs Rampant A Checklist for Bill Pay DigitalTransactions.net brings you the most important payments market news, in one place, updated the moment it happens Breaking news from the payments market, posted daily Concise, clean interface is easy to navigate Calendar of industry events Complete current and past issues of Digital Transactions magazine Detailed listings of payments market suppliers 13 years of payments news and analysis FEBRUARY 2021 • VOLUME 18, NUMBER 2 The Megamergers’ Subtle Impact 22 More than a year has passed since three giant mergers promised to change the payments world. Change has come, but not where many expected to see it. THE GIMLET EYE The Digital Dollar Revisited 4 TRENDS & TACTICS 6 Walmart Launches The Megamerger Green Dot’s PayPal vs. CFPB: It Trump’s Parting Shot: a Fintech That Wasn’t Latest Bid for the Ain’t Over Til It’s Over A Puzzling Ban on Unlike most startups, A potential FIS-Global Unbanked The U.S. District Court China-Based Apps this one will be a Payments deal blew up, Go2Bank is the latest handed PayPal a The departing president formidable player from but it showed merger initiative from one of big win, but it’s far barred Alipay and the get-go. fever hasn’t subsided. the most sophisticated too early for PayPal WeChat Pay, which have nonbanks. partisans to celebrate. little to no presence in the U.S. market. Plus, Security Notes outlines a strategy against rampant ransomware; and Payments 3.0 explains why the CFPB’s case against PayPal is far from over. ACQUIRING 14 STRATEGIES 27 Parking Apps Look to Upshift Decisions, Decisions When the pandemic ends, demand for Is your bill-pay provider setting you up parking places is likely to skyrocket. for success? Use this checklist to decide. That augurs well for apps that nd just the right spot—and let you pay for it. ENDPOINT 31 SECURITY 18 Merchant Feedback: Ransomware Makes The Not-So-Secret Key to Success Payments providers must move beyond a Comeback merely transactional relationships to The attack on TSYS last December was build lasting business. a sobering reminder of the vulnerability of payments companies to this insidious fraud. But there are steps you can take to protect your network. Cover Illustration: Jason Smith, 123RF.com Digital Transactions (USPS 024-247) is published monthly by Boland Hill Media LLC, 800 Roosevelt Road, Building B, Suite 212, Glen Ellyn, IL, 60137. Periodicals Postage Paid at Glen Ellyn, IL, and at additional mailing o ces. POSTMASTER: Send address changes to Digital Transactions, P.O. Box 493, Northbrook, IL 60065-3553. 2 DIGITAL TRANSACTIONS | FEBRUARY 2021 CONTENTS FEBRUARY 2021 • VOL. 18, NO. 2 THE DIGITAL DOLLAR REVISITED PUBLISHER Robert A. Jenisch EDITORINCHIEF John Stewart SENIOR EDITOR, DIGITAL ONE YEAR AGO IN THIS SPACE, in the waning days of the pre-Covid Age, we Kevin Woodward presented some thoughts about the newly established Digital Dollar Foundation CORRESPONDENTS and its proposal for a central bank digital currency (CBDC) for the United States. Jim Daly, Peter Lucas Since then, the notion of CBDCs has attracted much attention as authorities ART DIRECTOR/PRODUCTION EDITOR not just in America but also in Europe and Asia explore the notion of a fully Jason Smith digital national currency based on blockchain-based tokens. EDITORIAL ADVISORY BOARD Early last month, we published online a piece by payments consultant Eric Eula L. Adams Grover, who predicted that, much as many experts may point derisively at the John Elliott growing pains of Bitcoin and other cryptocurrencies, national governments Alex W. “Pete” Hart Former Chief Executive O cer, and CBDCs will have the last laugh. Mastercard International “Over the long-haul … digital fiat currencies will take share from physical William F. Keenan cash,” Grover wrote. “They will also compete with reigning electronic retail, President, De Novo Corp. money-transfer, business-to-business, and interbank payment systems … Dr. Gideon Samid Chief Technology O cer, Today, more than 80 central banks are exploring digital currencies ... A decade AGS Encryptions Ltd. hence, digital fiat currencies will be in the payments mix planetwide. They DIRECTOR OF ADVERTISING could have a tectonic impact.” Robert A. Jenisch, 877-658-0418 But even before Eric made this prediction, the former head of the Commod- [email protected] ities Futures Trading Commission gave a speech in Zurich that laid out the ADVERTISING SALES REPRESENTATIVES case for CDBCs as clearly as we’ve seen it made. J. Chrisopher Giancarlo, now Robert Mitchell, 877-658-0418, x7 heading up the Digital Dollar Foundation, showed in that November speech [email protected] Rob Akert, 877-658-0418, x6 just how high the stakes are: [email protected] “If we act now, I believe we can harness this wave of innovation for greater Digital Transactions, Digital Transactions News, financial inclusion, capital and operational e iciency, and economic growth for and DigitalTransactions.net are publications of generations to come,” Giancarlo said. “If we do not act, however, this coming Boland Hill Media LLC, 800 Roosevelt Road, Suite B212, Glen Ellyn, IL 60137 wave of the Internet will lay bare the shortcomings of the West’s aged, analog John Stewart, Managing Director financial systems.” Robert A. Jenisch, Managing Director The “coming wave of the Internet” he referred to is what he called the For advertising information, call 877-658-0418. To subscribe or “Internet of value,” a movement that bids to replace account-based money give us a change of address, go to transfers—such as those we have now with cards and checks—with token- www.digitaltransactions.net and click on “Subscriber Care” or call 847-559-7599. based transactions, which in theory require no intermediaries. The exchange The views expressed in this publication are of tokens is a direct transfer of value, the digital equivalent of one person not necessarily those of the editors or of the members of the Editorial Advisory Board. handing a dollar bill to another person. The publisher makes reasonable e orts to “A digital dollar,” Giancarlo said in that speech, “would make sending money ensure the timeliness and accuracy of its content, but is not engaged in any way in as simple, as immediate, and as cost-free as sending a text message.” o ering professional services related to nancial, legal, accounting, tax, or other When we wrote about Giancarlo last February, we referred to the somewhat matters. Readers should seek professional jocular sobriquet his ardent advocacy for a digital dollar had already earned him, counsel regarding such matters. All content herein is copyright © 2021 Boland Hill Media “Crypto Dad.” Now, 12 months later, that vision seems closer, less pie-in-the-sky, LLC. No part may be reproduced without the as national governments examine the concept and as a new administration set- express written permission of the publisher. Subscription prices: $59/year for subscribers tles in in the United States. Will Joe Biden become the new face of Crypto Dad? in the United States; $69/year for Canadian subscribers. All other subscribers, $119/year, John Stewart, Editor | [email protected] payable in U.S. currency. 4 DIGITAL TRANSACTIONS | FEBRUARY 2021 ONLY ONE OF THESE BIRDS CAN GIVE YOU THE LATEST NEWS IMPACTING THE PAYMENTS MARKET Today and every day follow DIGITAL TRANSACTIONS @DTPAYMENTNEWS on Twitter trends & tactics WALMART LAUNCHES A FINTECH Unlike many fintech startups, be,” McBride says. “Walmart has 4,700 goal of investing in entrepreneurs Walmart’s Inc.’s new financial com- stores and 1.5 million employees in in financial services. pany is expected to be a formidable the [United States], not to mention “We know that we have an oppor- player right out of the gate. The retail tens of millions of customers that tunity to create a suite of digitally giant unveiled plans last month to represent the target market of their enabled financial products that are partner with Ribbit Capital to cre- fintech o ering.” tailored to the unique needs of our ate a fintech that will provide what Walmart says it partnered with customers and associates,” a Walmart Walmart describes as “modern, Ribbit because of its fintech exper- spokesperson says by email. “We’ll be innovative, and affordable finan- tise. Ribbit’s investment portfolio able to move fast to create solutions cial solutions.” includes the no-fee mobile-invest- in retail and beyond.” Walmart, which will own the ment platform Robinhood, consumer- With Walmart declining to provide majority of the unnamed entity, will technology platform Credit Karma, any further details about potential have a readymade customer base and A irm, which provides innova- products, speculation is swirling through the giant retailer’s mil- tive payment options for customers. about the direction the new com- lions of customers and employees, Ribbit was founded in 2012 with the pany will take. The retailer already payment experts say. More than 265 million customers and mem- bers visit Walmart stores in 26 coun- tries, in-store as well as via Web sites. The retailer also employs more than 2.2 million workers worldwide. “What makes the announcement so significant is Walmart’s scale— they will instantly pose formidable competition, and their low-cost retail reputation is a model of what their product o erings will be like,” Greg McBride, chief financial analyst for Bankrate.com, says by email. “Most fintech startups are start- ing from scratch, but this one won’t Walmart is working with Ribbit to create its latest nancial-services o ering.