I have written earlier about problems in banking security and credit card security issues. But what about some other banking issues?
Banking is Broken: A Financial Revolution is Coming article tells that a trio of startups are seeking to change the way we manage our money, by focusing on the customers traditional banks are ignoring. Banks have been slow to embrace new technology.
Finland’s Holvi, Sweden’s iZettle and Estonias TransferWise all took the stage at the Slush startup conference in Helsinki last week, and while they all offer completely different services, they are share a similar goal – to empower the customers that they believe traditional banks are ignoring.
Holvi offers customers an alternative type of current account, integrating bookkeeping and money management in a clean, simple online interface. TransferWise, founded by the first ever Skype employee Taavet Hinrikus, is looking to bring the essence of Skype’s ethos of offering cut rate international phone calls to the money exchange market. Speaking at Slush last week de Geer said that iZettle was “effectively about democratising card payments.”
Keep in mind that Holvi, TransferWise and iZettle are just three of the hundreds of companies looking to cash-in on the revolution that is coming to the banking industry.
What made the article really interesting to me is that I happen to know one of the Kristoffer Lawson, Founder and CEO of Holvi. I have personally heard the story of how the company was put up, that they were applying the needed license and when they got it. But the article includes some a bold new statement: traditional banks are ignoring 80% of their customers.
Lawson believes that Holvi’s new type of account is “the future of banking” and his company is rethinking what it means to be a bank: Holvi offers customers an alternative type of current account, integrating bookkeeping and money management in a clean, simple online interface. It is designed for use by groups and organisations so they can collaborate, making it ideal for events such as Slush, which used the Holvi system for all its budgeting and ticketing operations this year.
And I have also heard of some other events in Finland do the same. The reason why such events have actively started to use the system is that Lawson had been earlier active on organizing different computer events, so he knows the needs of this type of organizations.
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Tomi Engdahl says:
Google is the bank – now own a debit card
Google is not afraid to expand into new areas. Now the company has introduced its own payment card, which works with Google Wallet service connection.
Wallet is an electronic wallet, which was developed by Google for smartphones. If your phone has NFC technology (Near Field Communication), the machine can pay for transactions NFC reader equipped with desktop computers. The electronic wallet can maintain the stores’ loyalty cards and credit cards.
Google acts as a bank, because the user can maintain the money Wallet system. Now, this Wallet account is also published in a separate debit card.
Operating the smart phone charging problem is that the cash machines do not necessarily NFC reader. Google will help the situation a traditional payment card, which combines with the user’s Google Wallet account.
Google Wallet service currently operates mainly in the United States, and the same goes for a new debit card.
Source: http://www.tietokone.fi/artikkeli/uutiset/googlehan_onkin_pankki_nyt_oma_maksukortti
Tomi Engdahl says:
One hundred big banks could go, warns McKinsey
A fifth of the largest global banks coud be broken up or bought within the next few years, according to McKinsey
http://www.epanorama.net/blog/2013/11/20/banking-is-broken-start-ups-try-to-fix-it/
One hundred of the world’s largest banks could be dismantled or taken over by more successful rivals within the next couple of years, according to a report by McKinsey & Co.
About a fifth of the world’s top 500 banks are at risk of becoming a takeover target due to their underperformance and inability to adapt to market conditions in the wake of the financial crisis.
McKinsey, which is an adviser to many of the largest financial institutions, advocates a “back-to-basic” strategy to avoid the “traps” that could see an array of large banks consigned to the history books.
“Banks that get caught in these traps are more likely to be among the 20pc of institutions worldwide that, in our estimate, may become acquisition targets in the next several years,” said the report.
Consultants from McKinsey have been hired by many banks since the financial crisis to advise on strategy.
Tomi Engdahl says:
We need anonymity to make democracy safe – Stallman talks bitcoin
http://rt.com/news/bitcoin-not-anonymous-stallman-522/
Although enthusiasm for ‘crypto-currency’ bitcoin is expanding, it is not going to save people’s privacy from US NSA spy agency data mining. A truly anonymous online currency is needed, Richard Stallman, president of the Free Software Foundation told RT.
Just as bitcoin soared above $1,200 mark, almost matching current gold prices, some 1500 proponents of the digital currency gathered in London to discuss the problems of the ‘crypto-money’ and how it could change the world.
The speakers included well-known freedom of information activists, such as Cody Wilson and Richard Stallman, bitcoin developer Michael Parsons, Cryptoauction founder Daryl Cusack, as well as RT’s Stacy Herbert of Keiser Report.
Bitcoin supporters – from investors and academics, to political radicals and internet geeks – have apparently been keen to discuss the challenges that face the currency, which they believe could become a global alternative for cash.
Five years since its creation by an enigmatic programmer nicknamed Satoshi Nakamoto, bitcoin has been recognized as legitimate cyber currency garnering increasing popularity.
However, while more and more online and offline services are mulling accepting payments in bitcoin, the currency still faces uncertainty. Seeing how it quadrupled in value just in one month, some fear that bitcoin is yet another large economic bubble.
However, another issue that concerns people in the wake of the global US National Security Agency (NSA) spying revelations is whether the transactions made with “miraculous” cyber money are protected from a watchful eye.
Richard Stallman: Bubbles can happen in bitcoin just as they can happen in housing, or in tulips, or anything that people speculate in. Bubbles can happen, and that’s nothing special or different. Is bitcoin a miracle? I’m not sure what that would mean – there are good and bad things about bitcoin. One good thing about bitcoin is, you can send money to someone without getting the permission of a payment company.
On the other hand, there is a potential problem with bitcoin, which is, it might get used for tax evasion.
RS: Well, its advantage is that you can send the money without getting some company to send it for you.
RS: I have to point out that bitcoin is not anonymous – that’s not part of its design. People don’t necessarily give their names when they do bitcoin transactions, but the government can probably figure out, who is doing the transaction. How are you going to get bitcoins after all, unless you set up a bitcoin money computer, which is how bitcoins are made, you are going to get them by buying them from someone. If you are an ordinary person, the way you could do it is by paying with a credit card to a company that will exchange government currency for bitcoins. The credit card identifies you, so when you get bitcoins in return, the government can see who you are.
Tomi Engdahl says:
Bank of America: Bitcoin could become THE currency of e-commerce
Guestimates that $1,300 is a reasonable price per coin
http://www.theregister.co.uk/2013/12/06/bank_of_america_says_bitcoin_could_become_the_currency_of_ecommerce/
Chinese banks may not be too keen on Bitcoin at the moment (which has done something to damp down the current price) but a new research report from Bank of America rates it as a major player in future internet transactions.
“We believe Bitcoin can become a major means of payment for e-commerce and may emerge as a serious competitor to traditional money transfer providers,” the report states. “As a medium of exchange, Bitcoin has clear potential for growth, in our view.”
Some suggest that the price of Bitcoin is going through a speculative bubble not based on reality, but the report’s authors suggest that the currency may not yet have reached its true value.
The Bank of America analysts think that the market value of a Bitcoin should be around $1,300, based on the assumption that around 10 per cent of e-commerce transactions will use the payment system.
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Tomi Engdahl says:
Holvi to change the payment to online time
Treasurer’s enlistment in the traditional organizational activities least liked a piece of cake .
But it may not in the future , when the Finnish company Holvi designed carry out financial transactions from the perspective of the user and the Internet to work utilizes ease .
Holvi is service for small businesses , organizations and event organizers planned service for managing monetary transactions.
The user can set up an account online working Holvi.com service account and take care of bills , alone or in association with others , to build a budget and monitor the maintenance , set up e-commerce and so on.
The service is backed by two years ago founded a startup Holvi Payment Services . Its aim was to create a service that frees businesses and organizations in energy management with operations instead of financial affairs .
“With the book and the manual task of running the transfer technology , people are able to focus on their core activities ,”
The service has become a success in its first year of operation. It has managed to gather several thousand customers and Holvi accounts have been forwarded charges of EUR 10 million already. Holvi aims to international waters after push from Finland’s success.
“We are strongly taking an arch to the international market in 2014. ”
The vault -like digital age innovation is not a rare startups field , but precisely regulated banking game in the field of new services developers will be less.
A couple of years ago, the founder of the Holvi started to study on the regulation and technology -enabled solutions. It was found that the existing banking replacement service would be possible to build new Internet-age perspective. One of the motivation behind the EU Payment Services Directive , which brought the Single European SEPA .
According to Toivonen, payment services, especially in smaller communities are left by the wayside , and those of the dome -like service to the need .
” Small and medium -sized enterprises and associations, half- side is very under served segment ,”
Source: Kauppalehti
http://www.kauppalehti.fi/omayritys/holvi+muuttaa+maksuliikenteen+nettiaikaan/201401595437
Tomi Engdahl says:
Bitcoin Woos Washington to Ensure Lawmakers Don’t Kill It
http://www.bloomberg.com/news/2014-01-08/bitcoin-woos-washington-to-ensure-lawmakers-don-t-kill-it.html
Bitcoin advocates entered Washington a year ago with the shadow of a federal criminal investigation cast over the virtual currency industry.
Their first mission: Win over, or at least not alarm, the U.S. Treasury Department’s Financial Crimes Enforcement Network, called Fincen.
“Our first reaction, particularly when I was on the law enforcement side, when we had something new was ‘Huge risk! Huge risk for money laundering. It’s bad!’” Fincen Director Jennifer Shasky Calvery said in an interview this week. “But we’re the Department of the Treasury, we can’t have that knee-jerk of a response.”
“As a rapidly growing hub for technology and venture capital, New York has every interest in building on the promise that technologies like Bitcoin have to revolutionize payment systems, or even form the building blocks for whole new technology platforms,” Schumer said during a Nov. 19 hearing.
The currency’s rapid rise in value, from about $13 per Bitcoin in January 2013 to about $840 yesterday, according to the CoinDesk Bitcoin Price Index, also is helping to push it onto Washington’s radar.
Tomi Engdahl says:
Porn Will Be Bitcoin’s Killer App
http://tech.slashdot.org/story/14/01/18/0343204/porn-will-be-bitcoins-killer-app
“In December, porn.com started accepting Bitcoin for its premium services, and the virtual currency quickly came to account for 10 percent of sales. At the start of January, a post on Reddit’s Bitcoin subforum boosted the figure to 50 percent, before settling down to about 25 percent.”
‘I definitely believe that porn will be Bitcoin’s killer app,’ he told The Guardian. ‘Fast, private and confidential payments.’”
Tomi Engdahl says:
Bank Branches depart from elsewhere – the Finnish IT houses can work
A Finnish IT companies gain tens of millions of euros of business opportunities in Central and Eastern European banking sector. Accordingly estimates of Finnish companies, Finpro export incentive.
The next few years, banks are reducing their costs by cutting the number of offices and directing clients in dealing with the Internet.
Finpro Roman Head of Trade Center Alexander de Reuterhorn release says that in Central and Eastern Europe are still a number of bank branches in every village. However, they will be shut down.
In Finland, the corresponding changes are already experienced in his view, at the turn of the 2000s.
Central and Eastern European banks shall, in addition of new systems, among other things, to increase their sales and automate their services.
Source: Tietoviikko
http://www.tietoviikko.fi/kaikki_uutiset/pankkikonttorit+lahtevat+muualtakin++suomalaiset+ittalot+paasevat+toihin/a960787
Tomi Engdahl says:
Still Don’t Get Bitcoin? Here’s an Explanation Even a Five-Year-Old Will Understand
http://www.coindesk.com/bitcoin-explained-five-year-old/
Tomi Engdahl says:
Bitcoin 2.0 Explained: Colored Coins Vs Mastercoin Vs Open Transactions Vs Protoshares
2014 Will Show the True Power of the Blockchain
http://voices.yahoo.com/bitcoin-20-explained-colored-coins-vs-mastercoin-vs-12475857.html
While the entire world is beginning to learn about the power of the Bitcoin payment network, the real innovation behind this protocol is happening behind the scenes. There have been many different Bitcoin enthusiasts who have been talking about the holy grail of decentralized exchanges and using the Bitcoin protocol for more than just payments, and it seems that 2014 is going to be the year when we see these features finally get implemented into some real world applications. There are many different projects that are currently aiming to take Bitcoin to the next level, and it’s likely that there won’t be one clear winner when everything is said and done. Before we hop into the competition, let’s take a closer look at exactly what these projects are trying to accomplish.
At its core, Bitcoin is a new technology that allows everyone around the world to come to a consensus on who owns what without the use of a centralized third party. There are many different applications that can be built on top of this technology, and Bitcoin is only the first of many apps to come. When you forget about Bitcoin and just look at the technology, there are a large number of new possibilities that jump out at you. For example, if you can have a decentralized ledger that explains who owns which asset, then why do we need centralized stock exchanges? If we can have a global consensus on who owns which domain name or email address, then why do we need centralized versions of these services? If it’s possible to create a global marketplace where buyers and sellers can find each other in a decentralized manner, then why do we need to use eBay? These are just a few of the possibilities that people are looking at right now when it comes to taking the technology behind Bitcoin and applying it to more than just payments.
The main idea behind the Colored Coins project is that you will be able to apply secondary values to certain bitcoins on the Bitcoin blockchain. Those secondary values can then be used to create completely new digital currencies that are backed by real world assets.
Mastercoin is a project that is somewhat similar to Colored Coins, but they are attempting to reach their goals in a different manner.
Open Transactions is a project that has been in development since before Bitcoin became a big deal.
At the end of the day, the reality is that all of these Bitcoin 2.0 technologies are not really competing against each other. Open Transactions will allow people to trade protoshares, mastercoins, bitcoins, and everything else on their servers.
Tomi Engdahl says:
T-Mobile Hopes to Shake Up the Check-Cashing Industry, Too
http://recode.net/2014/01/21/t-mobile-hopes-to-shake-up-the-check-cashing-industry-too/
On Tuesday, the No. 4 U.S. carrier announced a service called Mobile Money that aims to take aim at another necessary, if unpopular, segment of the U.S. economy: The finance industry.
Specifically, T-Mobile is hoping to offer an alternative for the 70 million or so U.S. adults that either have no bank account or have some bank services but still rely somewhat on check-cashing or payday-loan services.
Through the combination of a smartphone and a prepaid Visa debit card, T-Mobile (and its banking partner, Bancor) aims to offer many of the services typically offered through a bank, including check cashing, direct deposit and bill pay.
The service, dubbed Mobile Money, allows customers to purchase and reload the card at more than 3,000 T-Mobile stores and, eventually, at Safeway and other retail stores. They can use the card anywhere Visa is accepted, and can also withdraw money, without a fee, at 42,000 ATMs across the country.
“We’ve tried to zero out all the fees that are typical if you are T-Mobile customer,” Sherrard said.
T-Mobile doesn’t expect to make money on the banking service itself, but says that it does hope that Mobile Money customers become more loyal T-Mobile wireless service customers and stick around longer.
The company conducted a nine-week trial of the service in the Miami area, and saw greater-than-expected demand for the service.
Tomi Engdahl says:
Two websites you should show your boss if you want to be paid in Bitcoin
Now if only your landlord, tax man and just about everyone else accepted BTC
http://www.theregister.co.uk/2014/01/14/bitpay_bitcoin_payroll_api/
Bosses being nagged by savvy staff to write out paychecks in Bitcoins now have a choice of BTC-friendly payroll systems.
Atlanta-based US biz BitPay is the latest firm to announce an online service for paying employees in the digital money: it unveiled its BTC payroll tech yesterday as a beta for employers and payroll outsourcers.
Each worker just has to provide a Bitcoin receiving address, and adjust how much of their pay packet should be paid into their Bitcoin wallet. Dollars are converted into the cryptography-based currency on payday using a weighted average price calculated by BitPay every 24 hours.
And, of course, Bitpay’s CEO Tony Gallippi and three other employees draw their entire salaries in BTC.
Governments, meanwhile, are still pondering how best to regulate the digital money and its many copycats.
“It is an easier way to get Bitcoin than going through an exchange,” Wargo claimed. “If someone wanted to do, say, 25 bucks a month, it is a nice way to step in.”
Tomi Engdahl says:
Bitcoin’s Fatal Flaw Was Nearly Exposed
http://motherboard.vice.com/blog/bitcoins-fatal-flaw-was-nearly-exposed
Panic loomed in Bitcoin land on Thursday after the community’s largest mining operation, GHash.IO, approached half of all computing power in the system, the limit of the cryptocurrency’s well-documented fatal flaw.
If any one mining pool commands the majority of the market—the dreaded so-called “51 percent attack”—the integrity of the system becomes compromised, since the act of mining is how new transactions are processed. An attack like this can therefore essentially hijack the currency by controlling how consensus is reached.
This would theoretically allow the individual or group to spend money that they didn’t have or that wasn’t theirs, known as “double-spending,” among other potential abuses, some of which could go undetected. In such an event, even the mere possibility of abuse would undermine trust, and the resulting panic could cause Bitcoin to collapse.
The online Bitcoin community understandably lost its shit. “LEAVE GHASH,”
The fiasco “opens a whole new can of worms that people just don’t want,”
As Guo explains it, mining pools have evolved into a powerful political force within the community. Bitcoin’s open source development is meritocratic in that each new software upgrade only becomes relevant if the majority of miners are willing to update to the new version.
Now that mining has moved towards pools, the owner of each pool has effectively become a politician, a representative for his constituents
This creates a never-ending cycle of threats as each successive mining pool eventually closes in on that majority threshold. Guo compares this to the US political system. You keep having “elections” and new leaders, but, for practical purposes, “the end result is the same even if the names are different.”
“It turns Bitcoin into a currency with a central authority,” Guo told Motherboard, noting that no matter how many bitcoins you own, if you don’t own a similar proportion of mining computing power, “then you don’t really control your bitcoins. Mining power is voting power.”
Tomi Engdahl says:
The System Is Broken and We Have No Idea How to Fix It
http://motherboard.vice.com/blog/the-system-is-broken-and-we-have-no-idea-how-to-fix-it
Tomi Engdahl says:
Google Says It Has “No Current Plans Regarding Bitcoin”
http://tech.slashdot.org/story/14/01/23/2342237/google-says-it-has-no-current-plans-regarding-bitcoin
Tomi Engdahl says:
Mint integrates with Coinbase, so you can track bitcoin with the rest of your finances
http://venturebeat.com/2014/01/29/mint-integrates-with-coinbase-so-you-can-track-bitcoin-with-the-rest-of-your-finances/
The wild ride of bitcoin’s value is slowing down, and we are beginning to see the effects of that stability.
Personal finance app Mint is integrating with bitcoin wallet service Coinbase, so bitcoin owners can quickly track how much their stash is worth and compare this value to their other financial accounts.
“There are now 12 million bitcoin in circulation and 60,000 merchants accepting it via Coinbase,” Mint product manager Vince Maniago said in an interview. “We felt like it was something we couldn’t ignore anymore, and this is a good time to go out and support the currency as it becomes more legitimate.”
Coinbase is the most well-known and well-respected bitcoin wallet service out there.
This “crypto-currency,” shook the tech and financial world, and remains controversial today. There are those who say it is the future of money, and others who call it evil.
Tomi Engdahl says:
BitPay Launches Bitcore: An Open-Source Library For Interacting With the Bitcoin Protocol
Eric Calouro | February 14, 2014 | 0 Comments
http://newsbtc.com/2014/02/14/bitpay-launches-bitcore-open-source-library-interacting-bitcoin-protocol/
Atlanta-based BitPay today announced the launch of Bitcore, an open-source JavaScript library that allows developers to interact with the bitcoin protocol in any form they see fit.
“To encourage more developers to build software that interfaces directly with the real bitcoin network, we are launching Bitcore.”
Tomi Engdahl says:
Wanna use Bitcoin on your site? BitPay’s open-source library wants to help
Open source JavaScript kit for ‘anything you can imagine’
http://www.theregister.co.uk/2014/02/15/bitpay_releases_bitcore_library/
“Bitcore is an open source JavaScript library for doing anything you can imagine with the Bitcoin protocol,” the company said in a blog post introducing the tool.
Tomi Engdahl says:
As Mt.Gox Implodes, Rival Bitcoin Exchanges Remain Surprisingly Stable
http://techcrunch.com/2014/02/16/as-mt-gox-implodes-rival-bitcoin-exchanges-remain-surprisingly-stable/
Watching the gyrations in the price of Bitcoin has been spectator sport the past several days. However, unlike with prior busts and races, the price of Bitcoin has diverged heavily across its several exchanges. This has led to the Bitcoin market itself becoming siloed.
This shakes out in the following way: Those who believe in Bitcoin have continued to do so — just not on Mt.Gox, really — even in the face of public shaming through potential technological weakness, and the effective death of Mt.Gox itself, a once high-flying member of the larger Bitcoin fabric; who will trust it now?
Tomi Engdahl says:
The troublesome history of the bitcoin exchange MtGox
https://anders.io/the-troublesome-history-of-the-bitcoin-exchange-mtgox/
Most, if not all, of the people interested in the bitcoin phenomenon have heard of MtGox, the Japanese bitcoin exchange. I’ll look in to some of the issues they’ve run into over the handful of years they’ve existed.
Tomi Engdahl says:
First U.S. bitcoin ATMs to open soon in Seattle, Austin
http://www.reuters.com/article/2014/02/18/us-bitcoin-robocoin-idUSBREA1H05F20140218
Robocoin said on Tuesday that later this month it will install the first automated teller machines in the United States that let users buy and sell bitcoin
The kiosks, to be installed in Seattle, and Austin, Texas, are similar to ATMs but have scanners to read government-issued identification such as a driver’s license or a passport to confirm users’ identities.
Tomi Engdahl says:
Loop Wallet review: mobile payments are finally everywhere you want to be
Loop tricks any cash register into thinking your phone is your credit card
http://www.theverge.com/2014/2/19/5425494/loop-wallet-mobile-payments-review
NFC was supposed to be the future.
My next phone was going to include the technology, which would let me pay at any cash register by waving my phone instead of swiping my credit card.
Google’s contactless payments system was bound to take over the world. Until Google gave up on it.
But a new startup called Loop thinks it has the answer: a wireless payments technology that does what NFC promised to do, all without forcing carriers or retailers to change anything.
Loop comes in two flavors, for now: a $39 key fob and a $99 Mophie-esque ChargeCase. Both devices hold virtual versions of your credit and debit cards, and work at over 90 percent of the country’s credit card machines without retailers having to change anything, according to Loop.
It’s the NFC dream all over again
The Loop Fob is a bit chunky, and only holds one card at a time. (Coin solved this problem with an onboard screen and card-switching button, but it remains to be seen how well it actually works in practice.)
Loop’s biggest problem is that it’s a waste of time. It feels magical to use, but isn’t worth the additional 10 or 15 seconds it takes to explain to each and every cashier.
Tomi Engdahl says:
Banking Startup Simple Acquired For $117M, Will Continue To Operate Separately
http://techcrunch.com/2014/02/20/simple-acquired-for-117m-will-continue-to-operate-separately-under-its-own-brand/
Banking startup Simple has been acquired, the company announced today. The acquiring company, BBVA, is a 150-year old financial services corporation that operates in a number of markets, and a leading player in the Spanish market, as well as one of the top 15 banks in the U.S. and a strategic investor in banks in Turkey and China.
Simple will continue to operate as it has done to date
Originally founded in 2009, Simple co-founders Shamir Karkal and Josh Reich wanted to put people in control of their own finances. With established banks, data about customers’ own financial status was either kept squirreled away out of sight, or discarded altogether.
Tomi Engdahl says:
Pics: ‘Bitcoin ATMs’ spring up in the US
Kiosks to fill digital wallets … no cash withdrawals yet
http://www.theregister.co.uk/2014/02/24/bitcoin_atms_spring_up_in_us/
Tomi Engdahl says:
Exclusive: State of Bitcoin 2014 Report Analyses Emerging Trends
http://www.coindesk.com/bitcoin-2014-report/
Today, CoinDesk is pleased to release its first ever ‘State of Bitcoin’ report.
As anyone who follows Bitcoin closely knows, this is an extremely fast-moving space – making the production of a comprehensive while still up-to-date report extremely difficult.
Tomi Engdahl says:
Kristoffer Lawson Leaving Holvi
February 27, 2014
By Philip Ryan
https://www.bankinnovation.net/2014/02/kristoffer-lawson-leaving-holvi/
Kristoffer Lawson, co-founder and head of product for Finnish banking startup Holvi, announced his departure from the company today.
Lawson wrote on his blog today, “Last week the decision was made that Holvi would reposition to focus on a set of core business areas with a change in the executive team. I will be leaving that team.”
The company went live with its services in Finland last year, and was poised to spread to other countries in northern Europe when Bank Innovation last spoke with Lawson, last November.
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Tomi Engdahl says:
It’s BANKS v TELCOs: Mobe payments systems go head-to-head
Two industry bodies, both fighting for your cash – and your identity
http://www.theregister.co.uk/2014/03/12/payments_council_and_gsma_identity_schemes/
The GSMA’s Mobile Connect mobile payments project is going head-to-head with the Payments council’s rival Paym system after both systems launched this week.
The mobile operator creates a token which is then shared with vendors to verify who you are. Customers do not necessarily have to tie their actual mobile phone to the token – although that is the obvious choice – as they can elect to use their email address.
GSMA wants to make your mobile phone account your ultimate measure of identification
The project is an umbrella for a number of existing schemes
The association sees the mobile phone number as a unique identifier for a person which can replace multiple usernames and passwords. The scheme is based on the OpenID protocol which is used for the Google+ sign-in among other applications and there are existing Android APIs.
Historically, mobile payments hasn’t been used anything like as much as the banks would like
Of course what is really needed is a system where the connection, presence and billing information the mobile networks have is combined with the services the banks are offering – but that doesn’t look like happening any time soon.
Tomi Engdahl says:
Perseus, Atlas Launch Global Bitcoin Trading Platform
Venture Seeks to Facilitate Trading in Bitcoin by Institutional Investors
http://online.wsj.com/news/article_email/SB10001424052702303795904579433222564439410-lMyQjAxMTA0MDEwMjExNDIyWj
High-speed telecommunications provider Perseus Telecom and digital currency trading platform Atlas ATS formally launched Wednesday a globally integrated bitcoin exchange system in New York, Hong Kong and Singapore to facilitate trading in the digital currency by high-frequency trading firms and other large financial institutions.
Tomi Engdahl says:
Automatically Accept Membership Fees or Donations
http://hackaday.com/2014/03/13/automatically-accept-membership-fees-or-donations/
Whether you run a club or a hackerspace, collecting membership fees and accepting donations can be a pain. [MRE] from TokyoHackerspace has the solution, an automated machine that can accept cash from anyone who is walking by.
Tomi Engdahl says:
Facebook is reportedly prepping an e-money service, and is close to getting approval in Ireland
http://thenextweb.com/facebook/2014/04/14/facebook-reportedly-prepping-e-money-service-close-getting-approval-ireland/
Facebook wants to be more than a social network — it is planning to facilitate financial services in the form of electronic money and remittances, the Financial Times reports
The report cites sources as saying that Facebook is weeks away from getting regulatory approval in Ireland for a service that lets users store money on Facebook and use it to pay others — what’s known as “e-money”.
Tomi Engdahl says:
Amazon Says No to Accepting Bitcoin, Maybe to Building an Amex or Visa Competitor
http://recode.net/2014/04/14/amazon-says-no-to-accepting-bitcoin-maybe-to-building-an-amex-or-visa-competitor/
Like bitcoin? Like Amazon? Want to use bitcoin to buy stuff from Amazon?
I have some bad news for you. Not going to happen anytime soon.
“Obviously it gets a lot of press and we have considered it,” Amazon payments head Tom Taylor told Re/code in a recent interview, “but we’re not hearing from customers that it’s right for them and don’t have any plans within Amazon to engage bitcoin.”
Amazon isn’t alone in this stance among big e-commerce sites. EBay, Walmart.com, Target.com and other big names have shown no signs of moving toward acceptance. Probably the most well-known online seller to accept the digital currency is Overstock.com, which sells furniture online and has a comparatively modest market cap of $413 million.
Tomi Engdahl says:
Digital financial advisers bulk up: Betterment raises $32 million
http://tech.fortune.cnn.com/2014/04/15/digital-financial-advisors-bulk-up-betterment-raises-32-million/
A crop of new websites is fighting to help manage your money. They’re offering lower fees than traditional financial advisers, improved service, and a host of bells and whistles, from slick mobile apps to elaborate interactive dashboards. Increasingly, they’re backed by deep-pocketed investors from the industry they’re trying to disrupt.
Tomi Engdahl says:
EU: Let’s cost financial traders $400m a day, because EVIL BANKERS. Right?
Wait ’til this one hits your pension fund where it hurts
http://www.theregister.co.uk/2014/04/23/eu_hft_trading_regulation_clueless_eu_dogooders/
Hurrah! The European Union has decided to save us from the perils of automatic trading! Also known as High Frequency Trading (HFT) or algo trading, this is simply the practice of writing a piece of code to do the buying and selling faster than a human being can possibly do it.
Any investment firm engaging in it would have to have effective systems and controls in place, such as “circuit breakers” that stop the trading process if price volatility gets too high.
This next is extremely dubious:
To minimize systemic risk, the algorithms used would have to be tested on venues and authorized by regulators.
The life cycle of an algo is a few weeks at present; they’re in an evolutionary arms race. Does anyone at all think that the authorities are going to be able to turn around approval of a complex piece of software in that sort of time span?
What people are trying to exploit is correlations.
No one knows why prices move as they do.
That the algo has to be tested… well, yes. For, as Knight Capital found out, deploying untested code can nearly bankrupt you. Or as actually happened to them
However, there’s one part of this new set of EU regulations that is simply insane. They’ve decided to limit the tick size in order to reduce the profits that might be available to HFT traders. Tick size is the price increment
ades says:
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me of my old room mate! He always kept chatting about this.
I will forward this page to him. Pretty sure he will
have a good read. Thank you for sharing!
Tomi Engdahl says:
Hey, Michael Lewis: Stop DEMONISING Wall Street’s SUPERHUMAN high-speed trading
HFT’s NOT the free-market crusher new book says it is
http://www.theregister.co.uk/2014/04/02/high_frequency_trading_flash_boys_controversy/
This could be true of course: every participant in every market is always trying to rig it to their own advantage. But the important question is not whether people are trying to do so it’s whether they are succeeding in doing so – and even if they are could the solution be worse than the problem?
High frequency trading (HFT) basically is just what it says on the tin. It’s buying and selling stuff really quickly: even just threatening to do so is used as a technique. At its heart it’s a very old technology, it’s really just time arbitrage, which has been around for ages.
The algos are working rather more quickly than human traders are. The market is working fast enough that simple latency in communication, light speed itself, becomes a competitive edge here.
On the downside, this concentration on trading speed has enabled some market participants to see large orders before they are transacted. The US stock market include perhaps 13 or 15 actual exchanges.
Given the latency of information travel, those close to one exchange might see a large buy or sell order before other exchanges do: thus they can go and buy and sell that stock before that large order actually arrives, move the price either way by a cent or two and then sell to that large order when it arrives.
HFT makes trading on a market cheaper by orders of magnitude
And I have seen one proposal for doing away with that front running: let’s have a financial transactions tax to make it unprofitable.
Florian says:
There’s definately a great deal to learn about this issue.
I like all of the points you have made.
Tomi Engdahl says:
Banks don’t just blow cash on bonuses, they also buy their IT at a FAT markup
This lovingly crafted USB mouse, sir? Shall we say £50?
http://www.channelregister.co.uk/2014/04/28/mercato_margins_survey/
The banking industry – on average – coughed the highest margins for technology in 2013, doubtless indicating that champagne-guzzling fatcats drunk on bonuses were the ones in charge of purchasing.
A survey of 200 procurement and ICT managers in 12 sectors with annual budgets over £50k and based on some 150,000 products showed that the average product margin paid by banks for their kit was 39 per cent.
The research by enterprise app provider Mercato Solutions, sister company to reseller Probrand, also revealed the Leisure and Finance sectors at 33 and 26 per cent were second and third most profligate buyers.
“IT suppliers capitalise on the fact that most organisations can’t keep track of the supply chain stock levels,”
Tomi Engdahl says:
Hey, Michael Lewis: Stop DEMONISING Wall Street’s SUPERHUMAN high-speed trading
HFT’s NOT the free-market crusher new book says it is
http://www.theregister.co.uk/2014/04/02/high_frequency_trading_flash_boys_controversy/
This could be true of course: every participant in every market is always trying to rig it to their own advantage. But the important question is not whether people are trying to do so it’s whether they are succeeding in doing so – and even if they are could the solution be worse than the problem?
High frequency trading (HFT) basically is just what it says on the tin. It’s buying and selling stuff really quickly: even just threatening to do so is used as a technique. At its heart it’s a very old technology, it’s really just time arbitrage, which has been around for ages.
Tomi Engdahl says:
Changing the Game in Financial Services
http://www.entrepreneurcountry.com/united-kingdom/ecosystem-economics/item/changing-the-game-in-financial-services
There are estimated to be 54 million personal bank accounts in the UK. Depending on the research you read, between 50 and 75% of people are dissatisfied with the service their banks provide. However, in the past 6 months, since the introduction of the new easy account switching initiative, only 600,000 people, just over 1%, have switched their banking provider.
We are all underbanked – the banks have not invested in, nor do they have the skills, to build the banking services we deserve. We have come to accept banking the way it is.
However, as we move forward in our technological evolution and see all that is possible, we are increasingly expecting our banks to catch up and deliver banking the way it should be – an almost invisible, pain free ENABLER of transactions
We have witnessed a boom in the Fintech industry over the past 4 years
The value chain in financial services is being decomposed, the way it should be.
Price is not the core. Access and trust are vitally important for adoption. Consumers don’t want complexity, they don’t want to access five or six different services, each with their own sign-up process and user Interface, in order to replicate their bank and satisfy their banking needs.
The bit that is missing, in my opinion, is an aggregator for all individual services that have been launched and bundled together to function as a Virtual Bank. A single point of access to: manage deposits, payments, save and borrow, deliver superior channels across web and mobile, reduce costs for providers through shared KYC and due diligence and improve customer acquisition.
Banks work in silos
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Tomi Engdahl says:
Cost-cutting Barclays bank swings axe on 5,600 IT and ops bods
Consolidation, automation, sharing to remove ‘duplication’
http://www.theregister.co.uk/2014/05/08/barclays_it_cuts/
Barclays will axe about 5,600 IT and operations staffers in 2014 in a massive restructuring effort. The at-risk techies work across the retail and investment arms of the British banking group.
Tomi Engdahl says:
Collaboration with customers and multi-channel banking sector for the future .
” It is critical to acquire and analyze internal and external data from a variety of sources in order to really understand the needs of customers . Ultimately, the entire banking service process will re-define the customer’s point of view ,” PwC’s leading financial expert Thomas Kotilainen
Mapping of the respondents said about a third of the customer experience to improve the main cause for the digital service strategy of investing in the next two years. Only to increase the market share went to the customer experience of improving .
” Finnish banks can already be found good solutions , but ecosystems are still underdeveloped”
European banks are now expected to progress in the mobile banking services, social media services and service creation with customers.
Source: http://www.tietoviikko.fi/uutisia/tama+on+pankkien+tulevaisuus+asiakkaan+nakokulmasta+kaikki+uusiksi/a987585
Tomi Engdahl says:
Why Mobile Wallets Are Doomed
http://news.slashdot.org/story/14/05/13/1757250/why-mobile-wallets-are-doomed
“The other shoe has dropped for Square. The once-hyped mobile payments company is killing off its Wallet payments app and replacing it with a new app called Order, which will allow users to order food and beverages ahead of time at their favorite cafes and restaurants. For entrepreneurs, the concept of a mobile wallet seems so logical that the payments industry looks like it’s ripe for disruption.”
Tomi Engdahl says:
Let’s Face Facts: Mobile Wallets Are Doomed
Square is the latest example of a struggling industry segment that may never take off.
http://readwrite.com/2014/05/13/mobile-wallets-reality
A few years ago, Square was the technology industry’s darling. Founded by Twitter co-founder Jack Dorsey, Square introduced the concept of attaching a credit card reader to one’s smartphone for mainstream consumers and businesses.
Now, Square is doing what scrambling tech companies do when times are tough: kill off a product and introduce a new one based off of gimmicks and marketing ploys.
According to Jason Del Rey of Recode, Order will let consumers order ahead of the line from participating retailers and food establishments. Square could take up to 8% of the transaction with Order, which is well above the 2.75% industry standard it charges for in-store Wallet transactions.
After its initial bout of hype and success, Square has come to realize the immutable fact: Payments are hard.
Square isn’t MasterCard, Visa or American Express, which all have massive install bases and capital runways to dip their toes into.
Square is a large startup with poor profit margins, a confused business model, mounting debt and no core service in which it holds the majority of its market segment.
Mobile wallets were a big idea popularized in 2011, the same year that Square introduced its Wallet. Google started offering its Google Wallet starting that year, too. Between Google’s and Square’s wallets, about a billion dollars was spent trying to change the way people pay ($500 million each, if reports of each company’s finances are true).
PayPal has a mobile wallet that can make real-world transactions, but I have yet to run into a store that accepts it
For entrepreneurs, the concept of a mobile wallet seems so logical that the payments industry looks like it’s ripe for disruption. If everybody is always carrying around a powerful computer in their pockets, it’s natural to consider loading payment information onto that secure device as an alternative to cash or plastic cards.
The problem comes when this logical entrepreneurial spirit merges with an industry segment that is classically illogical.
The result is the status quo. People still carry around their leather wallets because that’s what they’ve always done: They prefer to pay with debit and credit cards because it’s just as easy as paying with their phones. The result is that mobile wallets have not gained critical mind share among the public.
Tomi Engdahl says:
Google’s Android Is Learning How To Reach Straight Into Your Wallet
You may even like it. Amazon and Apple won’t.
http://readwrite.com/2014/05/08/google-play-services-44-update-google-io#awesm=~oEdMqU52oAu100
What do you get when you take the greatest advertising company on the planet, computers that live in people’s pockets, software that guesses where you are and what you’re doing—and add access to people’s credit cards?
For Google, you get the ability to buy anything, anywhere and everywhere, targeted to users’ specific interests. And for Apple and Amazon, you get trouble.
Activity Tracking, Location, Ads And Instant Buying
Android: The Real-World Purchasing Platform
the central mission of Android has fundamentally evolved. This evolution is turning it into a powerful delivery platform for information, advertising and actions—like the ability to buy something through your phone from the street.
The mobile era is gradually bringing real-world actions into convergence with our digital lives.
Amazon, likewise, is the king of digital commerce and knows just about everything about its customers. But its ability to connect to consumers in the physical world is limited because it mostly has to rely on Apple, Google and Microsoft to reach them on mobile—at least outside of its Kindle Fire tablets and, possibly, its rumored smartphone.
Google has the lead in the the convergence of digital and real world commerce because it controls all the pertinent stacks.
Balboa Emergency Medical Technician says:
I do agree with all the concepts you’ve introduced to your post.
They are really convincing and can certainly work.
Nonetheless, the posts are too short for starters.
May just you please prolong them a little from next time?
Thanks for the post.
Tomi Engdahl says:
Circle wants to be your friendly neighborhood bitcoin bank
http://www.theverge.com/2014/5/16/5721690/circle-wants-to-be-your-friendly-neighborhood-bitcoin-bank
The implosion and subsequent liquidation of bitcoin exchange Mt. Gox last month played to the worst fears about digital currencies. Confusing to use and volatile as a store of value, bitcoin has also been the frequent target of hackers, thieves, and incompetent businessmen. Despite bitcoin’s appeal to venture capitalists eager to profit from a new financial system, the value for the average person remains elusive.
Circle, a highly anticipated new bitcoin startup that has raised $26 million, is hoping to change all that. The company, which is opening its service today in a limited release, hopes to be your friendly online bitcoin bank. Its web-based interface lets you deposit US currency and see it converted instantly to bitcoin without any fees. It physically isolates your bitcoin keys in cold-storage vaults and requires multiple “signatures” to bring them online. Its deposits are 100 percent insured, and it complies with US money transmitting and anti-money laundering laws. “The focus is on making this easier for people to adopt,” says the company’s CEO, Jeremy Allaire
Specifically, the focus is on making bitcoin easier to use for transactions as opposed to merely fueling speculation by investors.