Sunday, October 30, 2005

E-money via SMS: the SMS voucher

This Dutch site is called sms-bon. It specialises in sending pre-paid gift vouchers via sms. From the looks of it, the Dutch supervisors have not yet noticed this supplier.

Google Wallet May Debut Soon

See this RED HERRING article.

....Google CEO Eric Schmidt has said Google Wallet will not be a PayPal clone. Unlike PayPal, analysts speculate that transactions would be limited to ones between businesses and consumers. The service would probably not allow more personal uses, such as a friend sending money to a friend. But like PayPal, it would likely be a stored value account.

Dan Schatt, an analyst with Celent, a research and consulting firm, predicts the search giant will release the service by the end of the first quarter, if not for the holidays.

The price of safety

An interesting statement of the Consumer Union in the Dutch opinion magazine Elsevier. While in previous years consumers did not have the option to pay safely over the web (banks should work on that) the Consumer union now advises its customers to not use the now developed product iDeal for payments below 10 euro. Their main reason is that the price to the merchant for those payments would be too high. And this fee will have to be borne by the consumer eventually.

Quite an interesting line of resoning. Similarly they could advice consumers not to buy at merchants that use Microsoft servers rather than Unix alternatives. The reason being that the higher cost of merchants that use Microsoft eventually needs to be borne by the consumer.

Or am I missing something here?

Saturday, October 29, 2005

FATF: Looking in the wrong places

The economist has this article on financing terrorism and the use of measures such as proposed by the Financial Action Task Force on Fraud (FATF). Essentially those measures cost a lot of money and don't create any added value.

Which lead to the conclusion:
For KPMG's Mr Dillon, the resources already spent on the effort have handed a victory to the terrorists. “The cost to our global economy is so large, they've already had the effect they wanted,” he says. “The increasing costs of compliance and technology are a form of terrorism. We're damaging ourselves.”.

Great flash-promo for Chase blink

I stumbled accross this website that introduces the Chase Blink contactless card. It's a very graphic and appealing website that invites the consumer to change its payment behaviour towards contactless payments.
"Watch and we'll show you how..."
"In a blink you're done,... go ahead and try it yourself'.

Now, if you don't do anything after having looked at the introduction you get this woman voice saying stuff like:
- Come on, blink already.....
- Are you afraid to blink?'s easy, just click on a the card...
- Blink if you're still there.....
- Go ahead, blink away...
- Are you still there...?

Mastercard goes public: definitive Proxy Statement with SEC

Being sued by merchants, Mastercard needs cash.
So they sell of some shares and do the administrative thing.
See the document here.

...the Board of Directors of the Company has approved plans for a new ownership and governance structure that will broaden our ownership to include not only customer financial institutions, but also public investors and a foundation to be incorporated in Canada known as The MasterCard Foundation. These plans will also result in a new board of directors with a majority of independent directors. Approval of the proposals to be acted upon at the Special Meeting is necessary for the Company to transition to the new ownership and governance structure.

We believe that the proposed changes will give us a more stable base on which to implement our customer-focused strategy and bring value to our customers’ businesses. We believe this is a positive development for you as both a stockholder and a customer. We intend to continue to leverage our global strength and presence to the benefit of customers while remaining sensitive to regional needs. Through the MasterCard charitable foundation, we also intend to make a significant contribution to the societies in which we operate.

Wednesday, October 26, 2005

KPN signs exclusive deal with web-PSP Triple Deal

Planet Multimedia reports that KPN has signed an exclusive cooperation agreement with web payment service provider Triple Deal.

As a result Triple Deal will incorporate the payment mechanisms of KPN (Switchpoint, payment via premium SMS, payment via 0900-services) and KPN will incorporate the payment mechanisms of Triple Deal (iDeal, Wallie Card, Paypal, credit-cards, credit transfers etc).

My guess is that KPN realises that it can't stay out of the payment business if they are to make money with selling content via whichever channel. So their best move is the first move towards a payment consolidator. This allows them to cut a good deal on payment fees. And if this works for both of them, the next move may eventually be that KPN takes over Triple Deal altogether.

Tuesday, October 25, 2005

Doubts for the contactless OV-chipcard...?

Automatiseringsgids reports that this monday the Ministry of Transport has discussed with local government representatives (provinces and city councils) the extra cost of the contactless chipcard for public transport.

The goal is to know exactly what the expected cost will be for the new system. The Ministry has reserved 90 million euro for the scheme but rumours are that an additional 100-150 million euro is needed as the systems does not appear to function properly.

While in principle the contactless chipcard appears a good idea to the Ministry, the goal is to be able to inform parliament in december about the outlook for the OV-chipcard. As long as the new system is not as good as the current paper-based ticketing system for public transport (strippenkaart), the Minister of Transport does not want to throw away the old system.....

Sunday, October 16, 2005

eBay Buys VeriSign Unit

Redherring reported this week that eBay is buying VeriSign’s payment gateway business. The press-release was wrongly interpreted by many Dutch journalists as: EBay buys the payment system Verisign. But then again, it is not that easy.

eBay and Verisign will in the future work together to combat identity theft issues. VeriSign will equip eBay and PayPal with security services that include a system called a two-factor authentication, which gives users a one-time password or digital certificate to help protect against online identity theft.

So eBay gets acquiring business which is merely risky non-core business to Verisign. But it's what eBay and Paypal can handle and are good at. And Verisign gets to sell more security stuff and solutions (which is what Verisign is good at.

Looks like a win win thing. Does'nt it ?

Interpay system complies with central bank standards

Read this press release to discover that Interpay, the Dutch ACH, complies with central bank standards.

That is, the release should read that one of the systems of Interpay (rather than Interpay itself) complies with central bank standards. It appears from the DNB report in its Quarterly bulletin from September 2005 that Interpay's Clearing & Settlement System (CSS) complies with the BIS standards for system-critical retail payment systems. This covers ten Core Principles that relate to all aspects of an organisation: from security and management efficiency to control of financial risks and legal matters.

Too bad that this unique system, with features as half-hour settlement periods during the day, may have to be adapted / downgraded to fit the unified Target2 environment... just to show how European harmonisation experience in payments may result in improvements in Europe generally, but not for the Dutch in particular....

Wednesday, October 12, 2005

McCreevy on the future of payments in Europe

See this speech to ddiscover:
But I also want to be clear that I am ambitious for the successful delivery of this project. In order to sustain its political backing the Commission will need to be convinced that certain objective standards are met. For example:
* It would be unacceptable if the Single Payment Market results in a general price increase and price convergence at the top of the current range;
* It would likewise be unacceptable if the Single Payment Market results in less competition, fewer providers and governance and scheme rules that are not conducive to competition;
* User expectations have to be met.

Note the word objective standards, which is used in one sentence with user expectations... And note the plans for a New Legal Framework. This includes a light supervisory regime of payment service providers. But anyone may assume that supervisors will even make light supervision a heavy burden. So this will most likely raise costs and diminish competition...

Those objective standards sound more like incompatible mathematic functions to me...

Tuesday, October 11, 2005

ECB: Keeping up the momentum: achieving the SEPA objectives on time

On 3 October 2005, Gertrude Tumpel-Gugerell, Member of the Executive Board of the European Central Bank, gave a speech about how to achieve the SEPA objectives on time at the Off-site strategy meeting of the Coordination Committee of the European Payments Council in Durbuy. The first part of the speech comprised the ECB’s assessment of the status of the SEPA project today. The second part focused on the SEPA and the promotion of financial integration in the euro area.

Essentially, the ECB acknowledges that the previous idea that SEPA infrastructures would be completely migrated by 2010, is unrealistic:
I will therefore present the 2010 objective in a slightly different way than I did last year by acknowledging that SEPA for infrastructure will rather evolve gradually in the following three phases:

First, the adjustment of infrastructures by 2008 for the processing of SEPA payments in parallel to national payments (in this respect, it is important to focus specifically on how to ensure technical reachability for the pan-European direct debit scheme);

Second, the irreversible migration of a critical mass of national credit transfers, direct debits and cards to SEPA instruments by 2010 and the achievement of complete interoperability between SEPA-compliant infrastructures;

Third, and beyond 2010, I expect a reduction of the number of retail systems in operation in the euro area by means of competition and the phasing out of national instruments.

Friday, October 07, 2005

SWIFT - Conferences - Sibos 2005

S.W.I.F.T. has prepared an online version of the official Sibos 2005 Copenhagen Wrap Up Report. Available on the website are all the speeches, videos, photos, conference and exhibition summaries from Sibos, documenting the gathering of over 6500 attendees from the global financial community on 5-9 September 2005.

See the payment systems session overview

Ideal started with hick-ups and burps...

A number of media, amongst which Emerce report that Dutch internet payment system iDeal has finally lifted off. The reactions under the article indicate that there are still some operational hickups such as:
- not too well informed helpdesks of banks
- technical errors on application.
Furthermore there is some discussion on fees. Which may differ between banks and depending on the relationship with payment service providers.

All in all, the service may turn out to work fine but it appears that the Dutch have been spoilt by low fees. Rather than acknowledging the commercial value of a irreversible e-payment and immediate reconciliation, which can be priced into the consumer price, the comparison is made with the existing low fees for POS-payments.

Apparently the price can never be low enough for the Dutch.....

ABN AMRO introduces Access Online for the large corporates market segment

ABN AMRO announces the introduction of Access Online for the large corporates market segment. Through Access Online, companies can monitor all (national and international) payments online, as well as handle all daily banking transactions, such as payments, letters of credit, currency transactions and soon also deposits and cash management.

Single Euro Payments Area (SEPA): an environmental overview

A good article on Single Euro Payments Area (SEPA) which discusses roles and positions of Commission, banks, ACH's, ECB and identifies winners and losers. Author Bob McDowall concludes:

It is estimated that 98 per cent of all payments are domestic. If that is the case—if only 2 per cent of payments are cross-border—what is all the bother about SEPA anyway?. The focus then has to be on banks exploiting the opportunities this brings as much as the loss of margin it incurs. The lost revenues are in part the costs of losing historical protectionism. As in all deregulated markets, there are always some losers.

Monday, October 03, 2005

EPC statement 21 September 2005

See the press-statementhere and note:
The European Payments Council today approved its SEPA Cards Framework at a Plenary meeting in Brussels. It also agreed to release its SEPA Scheme Rulebooks for credit transfers and direct debits for consultation amongst national banking communities who will deliver the Single Euro Payments Area (SEPA) as set out in the EPC Roadmap.

Saturday, October 01, 2005

Albert Heijn trial with self-check out starts

This week a trial with self-check-out has startd at Albert Heijn in Utrecht Oost. Essentially, customers need to scan their purchased items themselves, go with the sales slip to an automatic payment pole, pay with cash, pin or e-purse and then use the payment slip to exit the shop.

First experiences are not ravishing. Even on a busy thursday evening, the shop is quite empty. The reason: there used to be only one line; right now there's queuing at the scan-machine, the payment machine and the exit-machine...

The trial is supposed to last eight weeks, but my guess is that it won't last that long.