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Category: PaymentTrends

PaymentTrends

  • Amazon Reportedly Prepping to Go Cashierless at Whole Foods

    Amazon Reportedly Prepping to Go Cashierless at Whole Foods

    According to the Wall Street Journal Amazon is testing larger format stores with its Amazon Go cashierless technology as a prelude to a Whole Foods rollout. The WSJ appeared to have spoken with several insiders. “It is unclear whether Amazon intends to use the technology for Whole Foods, although that is the most likely application if executives can make it work, according to the people.” There are predictions by some experts and entrepreneurs that virtually every physical retail store will be checkout free within 5-10 years.

    Walter Robb, former Whole Foods co-CEO, discussed the possibility of Amazon adding its cashierless technology to Whole Foods in an interview on CNBC:

    Amazon May Go Cashierless at Whole Foods

    I just think is part of a larger revolution that’s happening in retail and in food in general. The customers are having more and more options. Amazon Go, which is now up to 13 stores already has this deployed in a smaller store format. The application of this to a larger selection of products, most Whole Foods stores have about 35,000 units, is very exciting and very interesting.

    I think we’re just seeing this massive wave of disruption and innovation in retail in general. What this does is, if you call the grocery business about $2 trillion in the US plus or minus, what you’re seeing is all these new ways in which the customer can get their food. This is part of that choice. I think one of the things that people miss about the Amazon Whole Foods merger is the fact that physical retail really matters. What this does is say, okay we’re going to try to make the physical experience a little more streamlined for people so it contrasts with the online experience. I think you just see this bevy of choices the customers never had and we couldn’t even imagine five years ago.

    Whole Foods and Amazon Culture Clash Smoothing Out

    It’s still early but I think Amazon and Whole Foods certainly have different cultures and different styles, but I think that Amazon has very smart and capable people and I think the cultures are beginning to find their way, both their work processes. If you think about what we at Whole Foods gained from Amazon, we got tremendous first best-in-class technology and data capabilities, the digitization of Whole Foods, was significantly accelerated.

    I think for Amazon they got a great brand in fresh foods which they’d struggle up to that point. They got the knowledge of the customer in the physical stores versus just the digital world and they got proximity to about 85% of the US population. It was a real win-win-win combination. People forget that food is probably the largest sector in the economy. This is a very significant deal that happened and I think a proxy for the fact of how business and commerce in general are evolving so quickly.

  • LendingClub CEO Working to Turn It Into a Financial Health Club

    LendingClub CEO Working to Turn It Into a Financial Health Club

    The CEO of LendingClub, Scott Sanborn, says that they are really looking to make membership in the club mean something and are working to take Lending Club and turn it into a ‘financial health club’ that will help people successfully manage expenses. He says that LendingClub helps by shining a spotlight on credit card debt which is the first step to doing something about it.

    Scott Sanborn, LendingClub CEO, discussed the business with Investor’s Business Daily:

    A Looming Crisis in People’s Overall Financial Health

    We are seeing really an epidemic happening which is incomes have been stagnant for more than 20 years. All of people’s major expenses, healthcare, college, housing, is going up and it’s creating a real looming crisis in people’s overall financial health and it’s something that people just aren’t talking about. Close to half of Americans have credit card debts and they are more than twice as likely to talk about spousal infidelity than they are about the fact that they have credit card debt that they need to manage. We believe that by shining a spotlight on the problem it’s the first step to helping people do something about it.

    The first core thing we’re doing is we help people who have credit card debts pay that off with a healthier form of debt. Credit cards are now at a record high-interest rate average of about 19 percent. We allow them to pay that off with a fixed rate, fixed payment installment loan that will be paid off in a defined period of time so that they’re not caught in the minimum payment trap. It’s healthier for their overall credit profile.

    Turning Lending Club Into a Financial Health Club

    As we’ve been working with consumers to solve this problem we’ve increasingly been finding ways to actually do it even better. We launched last year the ability as part of the loan application to directly pay off the credit cards through the process. Instead of giving you the money, asking you to turn around and take care of it, we do it directly. In exchange, if you elect to do that we’ll give you a lower rate, essentially incent you to do it and make it easy for you to do it.

    The bigger picture in the course of time is we’re really looking to make membership in the club mean something and take Lending Club and turn it into really a financial health club and do more for people to help them manage these expenses.

  • Scott Kennedy of CSIS: China Amex Approval is #fakeopening

    Scott Kennedy of CSIS: China Amex Approval is #fakeopening

    Scott Kennedy, who is the Deputy Director, Freeman Chair in China Studies at Center for Strategic and International Studies (CSIS), said on Twitter that Amex finally winning Chinese market approval is not a breakthrough for China market access. He labeled it as a #fakeopening. “NOT a breakthrough for China market access,” noted Kennedy. “Amex still at least year-plus away from operations. And why should it be required to operate in a joint venture? #fakeopening.”

    He was also asked, How many American jobs will it create? Zero? Kenney replied, “Far more than 0, but difficult to calculate for financial services firms. AMEX activity in CH which requires job support in US + Repatriated profits that AMEX invests directly, puts in banks which lend to others + Chinese users that increase consumption US products.”

    Kennedy then added, “Other cross-border commercial activity that emerges out their business. + Same when Visa, Mastercard follow. + Marginal improvement in efficiency of China’s own firms, permits smarter investments, greater consumption. Lesson: Liberalization benefits diffuse, but exist.

    American Express getting market approval in China is being widely reported in the media as a promising development in light of the current trade war. Philippe Roy, Director Global Client Group Europe for Amex, reflecting on the news said, “American Express just became the first US credit card company to get the green light to start building its own payments network in China.”

    Earlier this year Scott Kennedy spoke about US-China relations:

  • Western Union CEO on Amazon Partnership: Buy Globally and Pay Locally

    Western Union CEO on Amazon Partnership: Buy Globally and Pay Locally

    Western Union has partnered with Amazon to white label their cross-border money transfer platform. “Amazon engaged us to use our platform to service their customers in a better way in order to give access to the millions of customers who don’t have an access today to buy online and pay,” said Hikmet Ersek, the CEO of Western Union. “In the future, they will have the capability to buy globally and pay locally.”

    Hikmet Ersek, President, CEO, Western Union, recently discussed the new partnership with Amazon, competition with Zelle and Vinmo, and the overall health of the business:

    Western Union Digital Business is Growing Very Well

    Our digital business is growing very well year over year. We are now in 50 countries with our digital business sending money to over 200 countries. We pretty much cover the world with digital. Our digital growth is very strong. Our retail money transfer business has been stable. In some countries, we have been a little bit slower like in the Middle East, but we had very strong growth in Europe and US outbound business. Our US domestic business has been a little bit slower than we thought. Generally, I would say that we had a very stable solid quarter and we are very excited about the future.

    You Can’t Send Money From Your Mobile

    US to Domestic there has been some competitive environment. Nothing changed like last quarter. We have certain customers that like to pick up cash immediately. Nobody can beat that. You can’t send (cash) money from your mobile. We pay out in cash immediately. There are also competitors like Zelle and Vinmo who have been capturing some market share there with their zero fee environment. That has definitely been US dominated but is only a small part of our business, seven percent of our revenues. We are more focused on the outbound business, global cross-border business. That has been growing very well.

    Western Union is White Labeling Platform to Amazon

    Amazon has engaged us, over the years we have been building a cross-border platform, which is unique. We are moving transactions in 132 currencies globally and we do about 32 transactions every second. We have a network of 550,000 locations. We are reaching out to about 4 billion accounts globally. This is a unique platform where today we serve our customers with this platform.

    Companies like Amazon engaged us to use our platform to service their customers in a better way in order to give access to the millions of customers who don’t have an access today to buy online and pay. In the future, they will have the capability to buy globally and pay locally.

    The Amazon partnership is for us very exciting because now suddenly we are opening our platform to new customer segments, white labeling to other organizations like Amazon. Today, we are serving our existing customers with our branded transactions. In the future, we will be able to serve huge organizations like Amazon, or Amazon will engage us with other organizations, to engage our platform and to use our platform to serve their customers.

    Paying Amazon Has Been a Real Obstacle for Some

    “There are people in the world who want greater access to Amazon’s huge product selection but paying for those purchases has been a real obstacle for many customers,” said Hikmet Ersek, president and CEO of Western Union. “We’re leveraging our money movement platform to make it easier to shop global and pay local. By facilitating the complex foreign exchange and settlement process, we’re opening up more consumer choices and access to online shopping for tens of millions of potential new Amazon customers.”

    Forrester Research estimates that cross-border shopping will make up 20% of e-commerce by 2022, with sales reaching $630 billion. Choice, quality and cost are the main motivations for consumers to shop online from overseas, but there are challenges and concerns about the lack of payment options for consumers who prefer to pay in person or consumers who are not comfortable using online payment methods.

  • Zippin CEO: In 5-10 Years Every Store Will Be Checkout Free

    Zippin CEO: In 5-10 Years Every Store Will Be Checkout Free

    What if going to a store was easier than shopping online where you could just walk in and pick up your purchases and walk out with payment happening all in the background?

    You have heard about Amazon’s cashierless stores, Amazon Go, and their plans to open thousands of those stores in the coming years. Now there are startups that intend to bring this concept to all stores by providing a software platform and a technology solution to retailers.

    Zippin Co-founder and CEO Krishna Motukuri talked about the technology behind his new checkout-free solution in a recent CNBC profile:

    At Zippin, our mission is to banish checkout lines for good. You can simply walk in, check-in when you enter, pick up whatever you want, and simply walk out. If there was somebody that actually was able to follow a customer around the store and see what they were picking and just took a note of that information and then when they walked out simply just gave them a bill, it would be very convenient for the customer.

    We use overhead cameras that look straight down and get a bird’s-eye view of the entire store. That allows us to uniquely identify customers and we use that information to also understand which items they’re picking from the shelf and which ones they’re putting back. This information is paired with sensors that are on the shelf that worked with the cameras to accurately identify which products cart picked.

    As we’ve seen in the online world where ecommerce customers can actually see which product you’ve clicked on how long you actually considered it or whether you put it in the cart or taking it out, there will be retailers that will be responsible in the way they use that information.

    In addition to supermarkets and grocery stores, we’re also getting a lot of interest from hotels, airports, stadiums, and commercial buildings. For the first time, this technology allows you to operate a store more cost efficiently. We expect more of these smaller stores to appear in residential complexes and office buildings where there was nothing other than just a vending machine and some salty snacks before.

    Our next step is to actually take the technology to an existing retailer and implement it in their stores. I would say five to ten years you should expect every store will be checkout free.

  • EU Investigating if Amazon is Using Data to Unfairly Compete With Third-Party Sellers

    EU Investigating if Amazon is Using Data to Unfairly Compete With Third-Party Sellers

    The European Union is on the prowl again in a likely attempt to win cash and concessions from Amazon. This is another investigation in a long string of investigations into American companies designed to extract big cash payments.

    European Commissioner for Competition, Margrethe Vestager, indicates that the issue is the possible use of third-party seller data by Amazon to determine which products it might decide to produce and sell itself, thus competing and presumably putting out of business the other sellers of that product. Vestager admits that there have been no formal complaints from resellers but they “have people” coming to them and asking questions about this issue.

    European Commissioner for Competition, Margrethe Vestager discussed their investigation on CNBC’s Closing Bell:

    EU Suspects Amazon Is Using Data to Compete With Third-Party Sellers

    It’s too early to have a concern but we like to understand how this is working because Amazon has this dual role, they host a lot of little guys and enabling them to do e-commerce which is a great thing, at the same time they’re a big guy in the same market. How do they treat the data that they get from the little guy? Does that give them an advantage that cannot be matched or how to understand this?

    We have concerns from the marketplace and we have seen this also in a sector-wide inquiry so so we’re very interested to learn also in deep detail how this works.

    There Are No Formal Complaints Filed From Third-Party Sellers

    One thing is to enable the little guy to do business. It’s another thing that once you have enabled it and you see how it works in the marketplace basically you take it and because you’re a big guy you do large scale so you can sort of occupy that marketplace yourself. We have people coming to us with concerns but no formal complaints have been filed from third-party sellers.

    The EU Already Settled an eBook Case with Amazon

    We have already had one Amazon case on eBooks, on German and English spoken eBooks. We saw that Amazon was saying if you as one of our suppliers do something innovative, if you lower your prices or something like that, you always have to give us the same benefit and that, of course, made it very difficult for the eBooks market to innovate.

    If you always have to give Amazon whatever you have then of course that puts a lid to innovation. That we solved in a settlement actually covering ebooks in almost all segments.

    Not Opposed to Amazon but We Have Questions

    It’s important that the price point is right because for many people on a low budget, of course, low prices is of the essence and enabling choice is a great thing. We also want to see that innovation is thriving because being a customer in an innovative marketplace is, of course, better than being a customer in a non-innovative marketplace.

    This is what we’re trying to understand how does this work and of course, it may turn out that we have no further questions to be asked but that remains to be seen.

    EU Commision Meeting With US FTC

    We’ve had a very good meeting today with Federal Trade Commission Chairman Joseph Simons and others from the FTC, and we didn’t discuss in any detail these questions. What we discussed is our cooperation which is actually very good because we exchange views, but we don’t try to walk in each other’s shoes.

    Status of the Google EU Investigation

    Of course, we expect a change of behavior because the decision is a cease-and-desist decision, you have to stop this and you cannot put anything in its place that has an equivalent effect. This is about enabling choice for the ones who produces our phone so that that maybe you can have a phone that carries other apps when you have the out-of-the-box experience.

    That is important for us to see this change in the marketplace to show that those who actually have the skills maybe to do another operating system from the Android open source code that they may be able to do that. The fine will have to be paid and then of course it is for Google to decide if they will appeal the case or not.

  • Microsoft, Mastercard Teamup Enables Small Businesses to Trade Globally

    Microsoft, Mastercard Teamup Enables Small Businesses to Trade Globally

    Mastercard and Microsoft recently announced their latest collaboration—the Mastercard Track. The program is described as a distinct trade platform that can be used worldwide. It will reportedly simplify and automate payments between companies.

    Payments are supposed to be a fundamental and essential aspect of any business transaction. However, a lot of companies struggle with late payments. These delays are caused by inefficiency most of the time and result in profit loss and the erosion of trust between the buyer and supplier.

    Mastercard and Microsoft believe Track has the potential to solve this dilemma. The Track platform can automate and streamline procurement-to-payment procedures. Instead of having payments and invoices in separate systems, all data will be placed in one location. This will give companies improved visibility into their cash flow and help them to comply and conduct payments in a more efficient manner.

    Mastercard said that Track builds on and augments the company’s range of innovation and B2B assets, including its card and account-to-account payment solutions, data analytics, payment gateway, and fraud management services. Meanwhile, Microsoft will provide its very own Azure cloud system to run the Track platform, thereby giving it the protection of the company’s strict security and compliance standards.

    Mastercard Track will also be supported by a partnership comprised of nine procure-to-pay solutions companies and B2B networks – Basware, BirchStreet, Coupa, Ivalua, Jaggaer, Liaison Technologies, the Infor GT Nexus Commerce Network, Tradeshift, and the Tungsten Network.

    Michael Froman, Mastercard’s vice chairman and head of strategic growth, said that Mastercard Track is a tool that will “help reduce frictions in the global trading system and promote increased exports—especially by small and medium-sized businesses.”

    At the moment, companies have to navigate the various mechanisms that are currently in place for payments. Aside from that challenge, brands also have to deal with the lack of transparency and copious paper trail.

    Mastercard and Microsoft say that all account-based, bank transfer, or card-based payment systems will be connected on Track. The platform will also integrate invoice information and purchase order and will streamline the back-office.

    The platform is ideal for small to medium-sized businesses, especially ones involved in global exports. However, Track will also offer banks, B2B, insurance, and technology companies a business opportunity by providing value-added services. For instance, banks can give supply chain and trade loans on Track while technology brands can offer better data analytics.

    [Featured image via Pixabay]

  • Google Chrome 69 Makes Your Passwords Harder to Hack

    Google Chrome 69 Makes Your Passwords Harder to Hack

    Google Chrome is a decade old and the company celebrated with a new look, a revamped password manager, a slew of develop-centric changes, plenty of security enhancements, and an improved omnibox.

    Google rolled out Chrome 69 just in time for its 10th anniversary on September 2, bringing with it an updated interface that’s more aligned to the Material Design principles that powers other Google products. A recent post on Google’s company blog described the latest Chrome update as having “more rounded shapes, new icons, and a new color palette.” It also emphasized how menus, prompts, and the address bar were simplified to enhance the user’s browsing time.

    One change that caught users’ attention was the browser’s password manager. While Chrome had previously offered to store user passwords, the new password manager will now be able to create strong passwords when required.

    Let’s say you’re about to join a new site, Chrome can generate a new password for you. Simply click the “Use suggested password” button. The created password will include the conventional requirements of a capital letter, small letter, and a number. It can even include a symbol if necessary.

    Image courtesy of Google

    [Gif via Google]

    You don’t even have to remember new passwords as Chrome will automatically save it to your vault. You will be able to check all your saved passwords on Chrome’s main toolbar and even have the option to export passwords as a CSV file.

    There are several advantages to the enhancements that Google made to its password manager. First, the passwords generated are strong and will not be vulnerable to hacking. Next, the user not knowing their new password provides them some security from phishing attacks. After all, how can you reveal your password when you don’t know what it is or can’t remember it?

    Chrome 69 promises improved auto filling capacities as well. The feature should work on more websites and make it easier for the tool to manage details like addresses, personal details, contact information, and payment options.

    Some sectors have pointed out that Chrome’s password updates are similar to what tools like 1Password and LastPass provide. However, the updated features are not yet available on mobile. This can be a big turn-off for some users and could drive them to use other compatible password managers.

    Users can update to Chrome 69 by utilizing the browser’s built-in updater. They can also download it from google.com/chrome, the Apple App Store and Google Play.

    [Featured image via sketchappsource]

  • Focus on One Thing and One Thing Only… The Customer

    Focus on One Thing and One Thing Only… The Customer

    Bill McDermott, who went from teenage deli owner to SAP SE Chief Executive Officer, recently gave an inspirational talk about how focusing on the customer is the most important thing for any business to succeed. Below is a brief excerpt:

    I came to the clear conclusion that there’s a perfect correlation between winners having dreams and accomplishing amazing things, but we all start somewhere. I traded in three part-time jobs to be a teenage entrepreneur running a delicatessen in Amityville Long Island. So I’m broke and somebody gives me a note for $5,500 which is $7,000 with interest, and I make the store a success. I keep it, then I miss one payment and I give the store back. That’s the deal.

    What happens when you’re under complete pressure to deliver? You have to focus on one thing and one thing only, that’s the customer. I was between two very large conglomerates, Finer’s Supermarket over here and 7-Eleven over here. My little business is right in the middle.

    What did I learn? I learned that the little one has to do what the big one is either structurally unable to do or simply unwilling to do… because they’re lazy.

    We focused on three market segments:

    One was senior citizens. What did we learn about senior citizens? They don’t want to leave the house, so we deliver. Then there were the blue-collar workers like my Dad, they were flush rich on Friday night and dead broke by Sunday morning. We give them credit and they keep coming back.  But the hard part was getting those high school kids to walk a block and a half past 7-Eleven to come to my little store. After all, why would they?

    Focus on the Customer:

    One day, I said let me go down there to 7-Eleven to see what’s going on. I go down to the store and see 40 young people lined up outside the store and only 4 inside. I said to one of the people in the line, why are you all out here, there’s a big store in there and you’re standing here? They’re like, well they think we’re gonna take things. I said, don’t worry about all that, follow me down to my store, and I brought them down 40 at a time. I had a little trick though. I had built a video game room on the side of that store with Asteroids and Pac-Man.

    I let them in 40 at a time, and at the end of a long day one of the young people said to me, Bill, when we want to be treated well, have good food, and play video games, we come to your store… and when we want to steal stuff we go to 7-Eleven!

    It’s amazing, they talk a lot about CRM and fancy technologies. You know what my CRM system was, it was a window! I could see my customers getting off buses and cars and walking into my store. I knew everything about the 500 people that came in that store every day and I knew that without them returning, because they were very satisfied, the probability of my little business succeeding wasn’t very high at all.

    The customer and the customer alone determines whether we win or we lose.

     

  • Stripe is Now Allowing Businesses to Issue Their Own Credit Cards

    Stripe is Now Allowing Businesses to Issue Their Own Credit Cards

    Stripe has just revealed that it will be offering businesses the capacity to make their own credit cards. The online payments company also announced that they will be using Mastercard and Visa as the operating networks for their new service, aptly called “Stripe Issuing.”

    The company explained that the service is “an API for creating cards and new business models” and can be utilized to develop a variety of credit cards, both physical and virtual. For instance, Stripe Issuing can be used to create expense cards with customized credit limits for employees and can even be used by new banks to issue credit cards to their customers.

    Since its launch in 2010, Stripe has experienced steady growth in the payments sector. Its system has made it easier for businesses like Lyft, Postmates, and Slack to process payments for ride-sharing, food delivery, and team collaboration services, respectively. 

    Stripe’s Annual Transaction Volume Since 2015

    Image result for stripe annual growth chart

    Now Stripe’s new service aims to fill another gap in payment processing. Lachy Groom, the head of Stripe Issuing, explained to Bloomberg that the company has “tackled many of the major problems on accepting payments” but that businesses still have difficulties in moving their money.

    Analyst Jordan McKee expounded on the appeal this new service will have on enterprises. He said that developing a customized payment infrastructure is very complicated and expensive, which is why the majority of companies don’t bother with it. However, Stripe offering a “simplicity value proposition” will definitely bring to light new cases that haven’t been considered previously.

    Stripe Issuing service may also generate a tidy sum. Not only will it receive a percentage from every payment made on a card,  it could also grow its revenue by retaining customers who are looking for a one-stop source to issue and receive payments. 

    Dozens of companies have reportedly tested the product, although no names have yet been shared. Businesses who are interested in Stripe’s new service can head over to the company site to request an invitation.

    [Featured image via Stripe]

  • Shopify’s ‘Ping’ App Streamlines Customer Conversations for Merchants

    Shopify’s ‘Ping’ App Streamlines Customer Conversations for Merchants

    As an entrepreneur, time is your most valuable resource, especially when you’re in a highly competitive market. Shopify is now helping businesses maximize their time with a new app that manages customer conversations across multiple messaging platforms.

    The company recently rolled out ‘Ping,’ for iOS devices. The standalone app can streamline customer interactions from SMS, Facebook Messenger, or a company website.

    Shopify is putting more focus on mobile solutions for businesses as half of its estimated 600,000 retailers are already using its mobile application. Most of these merchants currently use the shopping platform to process their business needs and handle their payment system.

    Communicating with Ping

    The Ping app will enable retailers to communicate directly with clients and respond quickly to their requests. All conversations a company has with their clients on any messaging app can be accessed using Ping.

    The fast response time is a great way to assist companies in delivering excellent customer service and building better relationships with clients.

    Shopify explained in its blog that the company developed Ping as another means for online merchants to run their company. With the app, retailers “can spend less time shuffling between separate tools” and spend more time on essential things like serving clients and expanding their business.

    What Can Kit Do

    Ping comes with a built-in virtual assistant dubbed Kit. This little helper can help you conceptualize, develop, launch, and manage your marketing plans. Shopify explained that Kit is designed to run your Instagram and Facebook ads, manage your email marketing campaign, retarget clients, and more depending on the information collected from customer messages.

    Kit can also implement complicated workflows, like touching up product images and searching for new products to expand your inventory.

    The marketing bot was purchased by Shopify in 2016 and an upgraded Kit Skills API is slated to be released later this year. Some improvements expected to be introduced is a natural language processing system that will provide business owners with more insights and the capacity to represent their company in a chat environment. The built-in assistant will be able to respond to frequently asked questions and shipping inquiries. Of course, there will still be instances when human intervention is needed, like when dealing with a large order from a client.

    The Ping app and Kit will also be able to do other AI processes like flag conversations that could lead to big deals or alert the owner of a customer complaint regarding an order.

    Retailers big and small can now download Ping for free on iOS. However, it’s not clear just when the app will become available to Android users.

    [Featured image via Shopify]

  • Brex Raises $57 Million to Launch New Credit Card for Startups

    Brex Raises $57 Million to Launch New Credit Card for Startups

    American fintech company Brex has just launched a new corporate credit card designed specifically to assist startups.

    The news of this unique credit card also comes on the heels of Brex’s recently concluded Series B funding round. The company was able to raise $57 million courtesy of investors like PayPal co-founders Max Levchin and Peter Thiel, Facebook’s Yuri Milner, VC Ribbit Capital, and the Y Combinator Continuity.

    Brex is the brainchild of young engineers cum entrepreneurs Henrique Dubugras and Pedro Franchesci. The two are known for founding Pagar.me, a Brazilian payments processor, when they were still in their teens.

    Brex wants to rebuild B2B financial products, and one key step to doing that is to start with a corporate credit card service. The company provides tech startups and various companies with instant approval of credit cards. What’s more, these have higher than expected credit limits and users don’t require any kind of personal guarantees.

    The San Francisco-based company basically underwrites businesses and foregoes credit history in lieu of factors like its investors and the equity the company holds, its cash balance and spending habits. Brex offers the first five cards of the startup free of charge. Any additional cards after that will cost $5 monthly.

    Brex credit cards offer several distinct features, like the capacity to capture receipts using your smart device and matching them to the card holder’s credit statement. The card can also be integrated with accounting software like Expensify, NetSuite, and QuickBooks.

    Dubugras and Franchesci reportedly spent the previous year talking with customers about developing a product that could successfully navigate the regulatory and financial challenges that usually prevent early-stage startups from getting credit card approval.

    According to Brex CEO Dubugras, “startups that have raised millions and are poised for hyper-growth can’t get slowed down hassling with banks requiring personal guarantees and offering meager credit limits.”

    Unfortunately, traditional credit models look at how much a company can pay back annually based on revenue. This practice automatically disqualifies startups. But Brex has gotten around that problem by focusing on the cash that the investors have given the startup.

    [Featured image via Pixabay]

  • Amazon and Google are Starting to Look More and More Alike

    Amazon and Google are Starting to Look More and More Alike

    The eCommerce landscape is in constant flux, with Amazon becoming more like a search-ads platform aside from being an eCommerce venture while Google seems to be doing the opposite. That’s one of the key takeaways from Mary Meeker’s annual Internet Trends report.

    Meeker recently presented her report at Recode’s Code Conference. Among the highlights of the talk was her observation that Amazon and Google are starting to evolve and converge. 

    While this convergence might seem strange to some, it’s inevitable that companies evolve as eCommerce continues to grow steadily every year.

    Amazon the Search Engine

    There’s no question that Amazon is lording it over in online sales. The company had a 28% share in gross merchandise volume (GMV) in 2017, a big jump from its 20% share in 2013.

    The past few years has also seen Amazon becoming the start-off point for more product searches than Google. A reported 49% of shoppers begin their product search on Amazon while 36% opt for other search engines. What’s more, Amazon shoppers are a loyal group. A PricewaterhouseCooper’s survey revealed that 14% of shoppers use this site exclusively. The company is also perfectly suited to take advantage of these searches with key features like one-click purchasing, which allows customers to purchase from Amazon once they find the results they want.

    [Graphic via MediaPost]

    Amazon is also aggressively growing its advertising side. More marketers are investing in the company’s paid search products, with 82% of Amazon Marketing Services users purchasing sponsored products while 65% buy headline search and product display ads.

    Google as an eCommerce Platform

    Google and Facebook continue to dominate ad revenues; Amazon is currently in fifth place. But with Jeff Bezos nipping at their heels, the Alphabet group is not resting on its laurels and has started to develop ways to ensure shoppers remain onsite. The company’s new AdWords feature – Shopping Actions – will ensure that happens.

    Shopping Actions essentially turns Google Assistant and Google Search into marketplaces that retailers can tap into while also allowing users to make direct purchases. Shoppers can add what they find in their search to a common shopping cart and easily check out using payment data already filed with Google. What’s more, the program works across various devices. This can provide Google a major advantage, given the increasing popularity of voice search.

    Home Depot, Target, Ulta, and Walmart are just some of Google’s retail partners. However, these partner retailers would have to sacrifice some of their sales and control of their customer’s online shopping experience to Google, it’s a small price to pay for being able to utilize the company’s vast resources, technology, and millions of potential customers.

  • PayPal Will Soon Integrate More Payment Options Into Google Services

    PayPal Will Soon Integrate More Payment Options Into Google Services

    Google’s rebranding of Google Pay this year was done to make twofold transactions go more smoothly. Now, the company is integrating PayPal into the mix. This will enable PayPal users to pay bills and make purchases without having to log in or out of Google services.

    The integration between Google and PayPal will go live later this year. It will cover any services and apps using Google Pay, like Gmail, the Google Store, and YouTube and will also work with peer-to-peer transfers.

    The two companies working together is not new. PayPal has already been a payment option for Google Play since 2014 and in online and in-store transactions that are handled by Google Pay since 2017. Google is also working with other payment partners like Braintree, Cybersource, Mastercard, Stripe, and Visa.

    The expanded relationship between Google and PayPal will undoubtedly benefit the two companies. For the former, it will mean a reduction of users leaving the site just to complete a transaction, a move that more often than not results in abandoned purchases. This will also give buyers more payment alternatives, ensuring that more sales are completed. As for PayPal, the union will also give its members an incentive to use its services to buy things, thereby leading to higher transaction revenue.

    This partnership also underlines the changes and challenges happening to online payments. A large number of consumers are already willing and ready to pay for services and items online. The problem is that with so many payment options and shops, it’s difficult to keep consumer interest. The challenge now for app publishers, shop owners and platform owners is how to keep people engaged in the product and not migrate to another site.

    The solution is to introduce services where payment transactions are already enabled at the point that they’re needed with minimum fuss. This means no jumping to another site or app, no logging in several times or taking additional steps just to finalize a payment. 

  • Microsoft Pay Streamlines Online Payment in Outlook

    Microsoft Pay Streamlines Online Payment in Outlook

    Microsoft is integrating its digital wallet service into Outlook, as announced during Build 2018 on Monday. Called Microsoft Pay, users can soon make payments on invoices and bills through emails without leaving Outlook and switching to another app or service. All it takes is a click on an Adaptive Card that details the invoice and payment action.

    According to Microsoft, fintech companies Stripe and Braintree will be some of the payment processors under the upcoming integration. Meanwhile, Zuora, FreshBooks, Intuit, Invoice2Go, Sage, Wave, and Xero will be tapped for billing and invoicing services for the new Outlook feature.

    The tech giant also revealed that the streamlined payment system will roll out in phases. For the first weeks, only a few Outlook.com users will have the capability in their email. Microsoft assured that more users will have access to the payment feature over the subsequent months.

    Microsoft emphasizes that Payments in Outlook is a solution developed for its users and not a service where it earns revenues. Instead, its partners earn commissions for every completed transaction. It is an opportunity for developers to monetize on several Microsoft platforms.

    For Microsoft, it isn’t about money but the convenience it offers to platform users. This integration is a way to make customers remain inside the ecosystem and use Microsoft services more often.  

    Microsoft may be a tad too late compared to its competitors, Android Pay and Apple Pay. However, the company’s broader shift to handy Adaptive Cards and integration-friendly developer mechanics has allowed the company to catch up. After all, Microsoft is known to have extensive capabilities in different aspects of computing.

    For businesses, this latest development lets them get paid faster by making the entire process simpler with a few clicks. Stripe agrees with this. “By removing the friction and time needed to complete a payment, Stripe and Microsoft can help businesses around the world reduce missed or late payments, ultimately increasing their revenue,” the company expressed in a statement.

  • Square Acquires Weebly for $365 Million, Aims to Be a One-Stop Solution for eCommerce Businesses

    Square Acquires Weebly for $365 Million, Aims to Be a One-Stop Solution for eCommerce Businesses

    Digital payments company Square has announced plans to acquire Weebly for approximately $365 million in cash and stock. The purchase was in line with Square’s objective to provide a cohesive solution to entrepreneurs in running their businesses across all channels.

    Known for its payment software and hardware, Square has diversified its portfolio to include money transfer, business financing, and customer relationship management software. The company offers flexibility in selecting and integrating third-party solutions that include point of sale, accounting software, and other back-office applications. Weebly, on the other hand, provides an easy to use platform for building and hosting websites. Over the years, it has focused on catering to small businesses and online companies.  

    With the merger, a start-up company doesn’t have to shop around separately for applications, hardware, and platforms compatible with each other to have a presence online and offline. It is one of the challenges in setting up an eCommerce site, especially for those without the know-how to do so. In a statement, Square CEO Jack Dorsey pointed out that the strategic move aims “to bridge these channels, and we can go even further and faster together.”

    Square emphasizes the importance of an omnichannel experience in commerce. It simply means that sellers can reach out to potential customers through both digital and physical storefronts. From brand discovery and purchase to returns and exchanges, the seller can interact with the buyer in-store, online, or even in-app.

    “From managing orders, appointments, and payments to building a website, running a business is complex, and entrepreneurs around the world want powerful and intuitive tools,” Alyssa Henry of Square said. “Whether they’re an artist, a winemaker, or a hairdresser, with Square and Weebly sellers will have one cohesive solution to build their business.”

    David Rusenko, CEO of Weebly, agreed that entrepreneurs would benefit the most from the merger. He wrote, “Together, we will support you to build professional websites and powerful commerce experiences — whether online or in real life. This move reinforces our original mission: to help the world’s entrepreneurs succeed. As Square + Weebly, we’ll be able to help you in more powerful ways than ever before.”

    He also assured Weebly clients that no major changes are expected to happen. The transaction, however, will boost Square’s customer base and provide a steady revenue stream. With 40 percent of Weebly’s 625,000 paid subscribers based outside the US, the deal is set to expand Square’s global presence.  

    Until the deal is finalized in the second quarter of 2018 and cleared of regulatory hurdles, Weebly and Square will continue to operate separately.

    [Featured image via Weebly Twitter]

  • Microsoft Warns of Rising Tech Support Scams, Calls for Industry-Wide Cooperation

    Microsoft Warns of Rising Tech Support Scams, Calls for Industry-Wide Cooperation

    Incidents of tech support scams targeting susceptible PC users are increasing, Microsoft warned. The company received 153,000 reported complaints from consumers in 2017, 24 percent higher than the prior year, according to its detailed security report released on Friday.

    Tech support scams reported to Microsoft

    Image via Microsoft cloud blog

    Reported incidents came from 183 countries, suggesting a widespread global problem. Of those who fell prey to the scam, roughly 15 percent lost money averaging between $200 and $400. There were cases of victims paying significantly more. In December 2017, Microsoft was notified of a tech support fraud in the Netherlands that resulted in the financial loss of €189,000, or about $109,000.

    Called social engineering attacks, scammers use a variety of ways to initiate the fraud. Cybercriminals send phishing emails, display strategic online ads or full-screen error messages, install malware, or place unsolicited phone calls to convince victims that their systems or devices have been compromised.

    Once victims contact the call center for help, a fake technical support specialist instructs them to install remote administration tools (RATs). This allows fraudsters to have complete control over the device and unrestricted access to sensitive information. They make changes inside the device and point out system errors to convince victims of the ‘problem’. This then prompts unsuspecting consumers to pay for the removal of fake or nonexistent malware.

    According to Microsoft, the widespread problem is not limited to its platform but has affected users of MacOS, iOS, and Android systems as well. The FBI received 11,000 tech support fraud complaints in 2017 from 85 countries. Of these, claimed losses amounted to approximately $15 million, representing an 86 percent increase compared to prior year.  

    The FBI also noticed an emerging trend: re-targeting past victims of tech support fraud. Scammers pose as government officials or law enforcement and offer assistance in recovering losses in exchange for fees. Other fraudsters act as collection services and threaten the victim with legal action for nonpayment of outstanding tech support fees. Some criminals use obtained personal information to commit additional fraud, such as unauthorized bank transfers or opening of new accounts for unlawful payments.  

    Microsoft expressed concern over tech support scams that bypass secure platforms like Windows 10 easily and coerce users into giving unrestricted access to their devices. Because the problem is far-reaching, the company called for industry-wide collaboration and law enforcement partnership. Microsoft continues to form partnerships with web hosting providers, telecom networks, browser developers, antivirus solutions, and financial networks in detecting tech support scammers.  

    The graphic below shows how the scam usual works.

    Image via Microsoft cloud blog

    Customers, on the other hand, can protect and empower themselves through education. Be wary of error or warning messages with phone numbers or emails with malicious attachments. Shut down your device once you receive a pop-up message or locked screen. If you have been a victim, notify your bank to reverse the charges and change all your passwords. Uninstall any application used during the tech support and run a virus scan for remaining malware.

    [Featured image via Pixabay]

  • Kabbage Teams Up with Ingo Money to Disburse SMB Loans Within Minutes

    Kabbage Teams Up with Ingo Money to Disburse SMB Loans Within Minutes

    Mobile lender Kabbage has partnered with push payments innovator Ingo Money to speed up disbursement of loans to small and medium-sized businesses (SMBs) accounts in real-time. The team-up, slated for a summer launch, is welcome news to SMBs that need fast loan payouts for their additional working capital.

    By leveraging Ingo Money’s “push payments in a box” platform, Kabbage can make the funds available to business debit cards or wallet accounts immediately. Whereas loan application and approval from financial institutions take weeks, online lenders like Kabbage has reduced the entire process to mere minutes.  

    According to PYMNTS website, Kabbage President Kathryn Petralia addressed the necessity of SMBs having quick access to funding and pointed out that customers often resort to using PayPal to withdraw loan payouts. With Ingo Money, clients now have more available options in moving money within the Kabbage platform.

    According to Lisa McFarland, chief product officer at Ingo Money, the push payments functionality means that Kabbage doesn’t need loan originating banks to handle the money transfer transaction to its customers. Apart from the technology, Ingo will also facilitate the SMB authentication and account verification of Kabbage customers prior to real-time funds transfer.

    Innovations like mobile lending have become crucial in keeping up with fast-paced technology and the changing business landscape. Small business owners have become more digitally savvy and increasingly depend on mobile platforms for conducting business. With available data online on business activity, sales, shipping, and accounting information, Kabbage can get a comprehensive snapshot of an applicant’s performance right away.   

    In a study done by Kabbage, about 17 percent of small business loans were made through a mobile device. Following this trend, mobile lending may account for 20 percent of SMB lending by the end of 2018. Kabbage even increased its available credit line up to $250,000 for businesses with larger and expanding operations. As of December 2017, the mobile lender has extended over $4 billion in loans to over 130,000 SMBs in the US.

    The mobile lender’s investors include SoftBank Group Corp., BlueRun Ventures, and Mohr Davidow Ventures, as of writing.

    [Featured image via Kabbage]

  • How EMVs Made Credit Card Processing More Secure

    How EMVs Made Credit Card Processing More Secure

    Due to rising incidents of fraud and data theft, credit card issuers and merchants switched to using EMV technology to authenticate transactions. Taking its name from Europay, Mastercard, and Visa, EMV was developed as far back as the mid-1990s, but the technology was only widely adopted in the US with the advent of the liability shift in October 2015. This shift meant that the least EMV-compliant party in a payment process would be the one held liable for fraudulent transactions. 

    The use of cards with magnetic strips slowly gave way to the use of the newer more secure EMV cards.

    EMV uses small chips or microprocessor to store information, perform processing, and generate dynamic data for every transaction. This makes it nearly impossible to replicate transaction code and create counterfeit cards. Meanwhile, mag stripe cards store unchanging data on sensitive cardholder information that are easy to duplicate.

    Because of its security features, EMV-enabled cards significantly reduced fraud-related incidents. According to Visa, merchants accepting ‘chip cards’ reported a drop in counterfeit fraud losses by 58 percent in December 2016 when compared to December of the previous year. Similarly, Mastercard fraud data also saw a 54 percent decline in counterfeit fraud from April 2015 to April 2016.

    The migration to chip technology may be slow but looks encouraging. During the recent Secure Technology Alliance Payments Summit, keynote speaker Stephanie Ericksen of Visa revealed that 96 percent of the company’s payment volume at point-of-sale (POS) use EMV cards. In addition, 59 percent of POS terminals in the US accept chip cards—an impressive growth since the liability shift.

    Fraud reduction is the biggest benefit for merchants upon shifting to EMV technology. Compliance with the standard also limits the financial liability of business owners if they process a fraudulent transaction. Customers also seem to prefer using EMV-enabled terminals that offer more security. In fact, a 2016 survey by NerdWallet revealed that 43 percent of respondents prefer using chip cards for in-store purchases.

    Chip technology helped combat fraud in face-to-face settings, like grocery stores checkout lanes, that use counterfeit cards. But it did not completely eliminate data theft and other types of fraud. Fraudsters have shifted their focus to card-not-present (CNP) fraud on transactions done via phone or online. The threat becomes even more significant as the eCommerce in the US grows at an exponential pace.    

    According to Brett McDowell of the FIDO Alliance, 50 percent of reported fraudulent transactions are attributed to CNP fraud. The majority of data breaches in 2016 were due to weak or stolen passwords. This indicates the need for stronger authentication and identity verification processes to better secure the overall payments system, including the EMV ecosystem.  

    Despite the achievements and progress in EMV migration of the payments industry, business leaders acknowledge that there is more work to be done. They are also upbeat on the next step in the chip card transition—contactless payments.

    Dual-interface EMV cards can also have contactless card reading or near field communication (NFC) features. Consumers only have to tap their card on the terminal scanner for faster checkout. However, there are several hurdles to this technology, such as lack of acceptance, confusion among users, and few companies issuing NFC-capable cards.

    There is more to the future of payments, including embedding biometric readers on cards to verify a cardholder’s identity. Industry leaders are also looking at cryptocurrencies, artificial intelligence, and blockchain as other forms of payment technologies. 

    [Featured image via creditcards.com YouTube]

  • PayPal Ventures Into Banking, Targets Customers Who Don’t Have Bank Accounts

    PayPal Ventures Into Banking, Targets Customers Who Don’t Have Bank Accounts

    PayPal is venturing into new territory. The online payments company is reportedly set to offer traditional banking services to their consumers. Features like debit cards, direct deposit paychecks, FDIC insurance, and other financial services are expected to be introduced in the first half of 2018.

    What makes PayPal’s move more interesting is the fact that the company does not have a US banking license. However, the San Jose-based company has gotten around that little detail by collaborating with small banks that can handle those services. For instance, a Delaware bank will be managing debit cards while a Utah bank can offer loans to small businesses and other PayPal customers.

    At the moment, PayPal Holdings Inc. is only offering these features to a select group of clients. The company won’t be requiring a minimum balance nor will it charge any monthly fees. However, users will have to pay ATM fees if they use machines that are not included in PayPal’s MoneyPass system. They will also be charged one percent of any checks deposited via the smartphone camera system.

    Bill Ready, PayPal’s Chief Operating Officer, said the company’s new services are not intended to replace conventional banking system. He further explained that what the company wants is to offer banking choices to customers that have difficulty accessing them, which is something PayPal believes is vital as the world moves towards a more digital ecosystem.

    “We’re trying to bring more of those people into the digital economy,” Ready said. “For folks who don’t have bank accounts, for folks who don’t have credit and debit cards, we want to give them something so they’re not turning to prepaid cards, check cashiers and payday lenders.”

    PayPal’s COO also noted that there are around 30 million people in the US without bank accounts and that they spend about nine percent of their pay on fees and interests from alternative monetary services. With PayPal’s new banking features, these people will hopefully be given access to the digital economy.

  • Stripe’s New Subscription-Billing Service is Making it Even Easier for Online Businesses to Get Paid

    Stripe’s New Subscription-Billing Service is Making it Even Easier for Online Businesses to Get Paid

    A lot of transactions and payment services are now being done online—from subscribing to streaming services like Netflix, to ordering food or buying clothes. This has led to a need for tools that will let companies, particularly small businesses, get paid.

    Stripe is stepping up to meet these demands with Stripe Billing. This subscription-billing service was developed to help both starting and established businesses get paid on time and without any problems.

    The company is known for supplying developers with the means to charge customers and conduct transactions in a simpler way. But now they’re taking it further by rolling out a billing product geared for online businesses.

    Stripe Billing reportedly uses machine-learning technology to help curb late or missed customer payments. The system can handle tasks like invoicing and subscription recurring revenue. It’s easier and faster to use than other payment systems. What’s more, it uses predictive technology that pinpoints the optimal time to retry collecting on a missed payment with the goal of reaching the client.

    Stripe has also coordinated with major credit-card providers like American Express, Discover, Mastercard, and Visa to allow customers to receive their updated or new credit card numbers without having them re-enter their personal information.

    Stripe Billing also supports ACH payments and wire transfers, a feature that will undoubtedly help corporations and companies with larger accounts.

    Tara Seshan, PM on Stripe’s billing product, explained that even large companies with enough resources to develop in-house billing would lament on how challenging the process is. This prompted them take a step back and think about how to devise billing tools that are accessible to everybody.

    “That meant something really flexible and really easy to implement,” Seshan said. She also added that even if you’re a small business, you should have “the same subscription tools as Spotify.” Stripe Billing can be considered the “building blocks” that a company can use to have a fast and flexible payment service.

    [Featured image via Stripe]