Hello there again.
As you can see from the dates on the blog. I have been out for a while, taking a good number of sabattical years off and enjoying myself with other stuff than payments. But developments here in the Netherlands remain entertaining enough to take up some blogging. No too much, because I shouldn't overdo it.
Hottest news here in the Netherlands is that last week the OV-Chipkaart once again became the subject of media attraction as a tv program explained how to crack the card. A free program to increase the credit on the card became available and known through Geenstijl. And contactless card readers got sold out, even via the Internet.
So discussions in parliament and media once again occured and the province of Zuid-Holland decided to not completely migrate to the OV-Chipkaart but allow the old Strippenkaart to be used. And the Dutch Parliament did not wish to discard the whole project yet. Still, we should note that this is all not really new: already since 2008 the dutch newspaper Trouw decided to open a separate corner in their website for the 'Drama' of the OV-chipkaart.
Translink systems formally claim they can handle the frauds and point to the fact that also bank cards are prone to attack/fraud (forgetting to mention the differences in financial and technical impact). So thay play it all down. But we keep on discovering unintended or hidden consequences. For example: the sigar/tobacco shops that used to sell the strippenkaart found out sme serious financial impact of decreased visitors to their shops. And the new OV-chipkaart loading machines that some install in their shops, don't give as much kick-back as the strippenkaart.
Now, this is quite a nice time to have a renewed look at the cost benefit analysis of the OV-chipcard. Effectively the business case gets a bit worse, because there will not remain a lot left of the 'income' made by the reduction of fraud or 'grey' travel (possible with the Strippenkaart and assumed to be non-existent with the OV-chip). This is calculated as a benefit of between 380-500 million euro. Also the re-use of OV-chipkaart in other applications would give benefits of 100 million euro. So we'll be seeing a slow meltdown of the business case of the OV-chipkaart.
So while the business case is slowly fading into the sea, what in the end may make or break the card is the consumer-side of things. For example, right now, the handling of consumer complaints in case of forgetting to check-out, is near to disastrous. So there is not much of a warm feeling with the Dutch citizens with respect to this card. Also, in practical terms, the card doesn't completely do what its predecessor can. Try taking a group of people (of a school class of 14) to the ZOO and you'll discover the hassle soon enough.
It's a matter of time before we'll move on to the next generation or next system. And with this experience of a non-bank issuer/provider of payments means, perhaps the public will now more appreciate the quality of service that they are used to from their bank-issuer provided system.
Saturday, January 29, 2011
Wednesday, June 04, 2008
Hey fool ! Don't become a money mule: unique prevention campaign of Dutch banks
The Netherlans Bankers' Association has today launched a unique prevention campaign to alert the public not to become a money mule in the hands of criminals. In a viral-style campaign 3 films are visible on a website that mocks the easy-money style job offerings a that are all around on the web (become our money transfer agent and earn 10% commission).
Most certainly for banks this is a highly unusal and innovative approach, executed in close collaboration with the national police authorities and the Ministry of Justice. The main goal: prevention and increasing the awareness with the public that becoming a money mule will damage your financial career.
The pay-off: hey fool, don't become a money mule .... should work in other countries as well...
Most certainly for banks this is a highly unusal and innovative approach, executed in close collaboration with the national police authorities and the Ministry of Justice. The main goal: prevention and increasing the awareness with the public that becoming a money mule will damage your financial career.
The pay-off: hey fool, don't become a money mule .... should work in other countries as well...
Wednesday, March 19, 2008
ING first to announce SEPA strategy for cards/terminals - all brands allowed
Yesterdays Telegraaf contained some interesting news. ING has announced that it will sell POS-terminals and contracts to retailers which accept V-Pay, Maestro and PIN, all for the low price of todays PIN-transaction. Only one condition applies: it should be an EMV compliant terminal.
Well, this is exactly what retailers wished: clarity on future prices and terms and conditions. So one would think that would now be happy.... but are they...?
Well, no of course. The instant that a retailer gets the prices and desires he wants, he assumes that he has insufficiently bargained and that there is more left to bargain for. And he will immediately start negotiating for another round of fee cuts or what have you.
Likewise in the Dutch situation. In their reply to the ING announcement the retailers didn't spend any second complimenting ING on their vision, their fee structure or on fulfilling their previous demand. The next complaint in line is now that they find it intolerable that on the issuing side (which is completely not their concern) the PIN technology is based on magstripe and the other brands on EMV. In their view PIN should move to chip-based PIN as well....
To be continued.... I would say... until banks decide to stop participating in this retailer bargaining game.
Well, this is exactly what retailers wished: clarity on future prices and terms and conditions. So one would think that would now be happy.... but are they...?
Well, no of course. The instant that a retailer gets the prices and desires he wants, he assumes that he has insufficiently bargained and that there is more left to bargain for. And he will immediately start negotiating for another round of fee cuts or what have you.
Likewise in the Dutch situation. In their reply to the ING announcement the retailers didn't spend any second complimenting ING on their vision, their fee structure or on fulfilling their previous demand. The next complaint in line is now that they find it intolerable that on the issuing side (which is completely not their concern) the PIN technology is based on magstripe and the other brands on EMV. In their view PIN should move to chip-based PIN as well....
To be continued.... I would say... until banks decide to stop participating in this retailer bargaining game.
Friday, January 04, 2008
van Hove's take on the Commission flawed interchange decision
Amidst all the political noise on the interchange decision of the Commission it is good to also see that some academics still see the whole picture and have the courage to challenge politicians where it hurts. See this article by Leo van Hove and more particularly his closing remark:
So if regulating one payment instrument can have unintended repercussions on substitutes, and a prohibition of interchange fees would be a leap in the dark, what are enlightened policy makers to do? They could simply try to ensure that market forces work, and in particular that merchants cannot be locked in by card networks. To that end, retailers should be allowed to "surcharge" and pass on interchange fees to consumers. Promoting competition among card networks as well as among various payment instruments should also be high on regulators' lists. More generally, we need policy makers who have a comprehensive vision of the future of our payment system -- and who have the political courage to make cash more expensive in order to lower its cost to society.
So if regulating one payment instrument can have unintended repercussions on substitutes, and a prohibition of interchange fees would be a leap in the dark, what are enlightened policy makers to do? They could simply try to ensure that market forces work, and in particular that merchants cannot be locked in by card networks. To that end, retailers should be allowed to "surcharge" and pass on interchange fees to consumers. Promoting competition among card networks as well as among various payment instruments should also be high on regulators' lists. More generally, we need policy makers who have a comprehensive vision of the future of our payment system -- and who have the political courage to make cash more expensive in order to lower its cost to society.
Wednesday, December 19, 2007
Commission prohibits MasterCard's intra-EEA Multilateral Interchange Fees
See the press release here to read a landmark decision of the Commission. It's main argument:
The Commission concluded that MasterCard's MIF, a charge levied on each payment at a retail outlet when the payment is processed, inflated the cost of card acceptance by retailers without leading to proven efficiencies.
Well, the discussion cannot be solved and Mastercard will not be able to prove it is right. But neither can the Commission. As I pointed out in an earlier post (ultimate paper on interchange fee by Brookings Insitution). So this is a power game, a legal game and a communication game at the same time.
We should note that at present the multi-lateral fall back MIF allows lots of smaller banks and participants to the Mastercard scheme. Those players would otherwise have to negotiate individually with all issuing banks. And that would be so costly that they wouldn't join the system at all. And I fail to see why the Commission isn't able to calculate those costs of negotation (and view the efficiency benefits of having a fallback MIF). Do they now really expect all members of Mastercard to use the next 6 months to agree bilaterally on new fees...?
The Commission concluded that MasterCard's MIF, a charge levied on each payment at a retail outlet when the payment is processed, inflated the cost of card acceptance by retailers without leading to proven efficiencies.
Well, the discussion cannot be solved and Mastercard will not be able to prove it is right. But neither can the Commission. As I pointed out in an earlier post (ultimate paper on interchange fee by Brookings Insitution). So this is a power game, a legal game and a communication game at the same time.
We should note that at present the multi-lateral fall back MIF allows lots of smaller banks and participants to the Mastercard scheme. Those players would otherwise have to negotiate individually with all issuing banks. And that would be so costly that they wouldn't join the system at all. And I fail to see why the Commission isn't able to calculate those costs of negotation (and view the efficiency benefits of having a fallback MIF). Do they now really expect all members of Mastercard to use the next 6 months to agree bilaterally on new fees...?
Saturday, December 15, 2007
Paying cash more expensive than using the debit-card
Here's an interesting bit of research done in the Netherlands. All shops, banks and central bank have joined forces to evaluate the cost of payments with cash, when compared to debit-card. The results are that it has taken us in the Netherlands some 15 years to ensure that the full cost of debit-card payments are lower than cash-payments.
The research outlines that:
- full cost of payments in retail are down from 839 million euro in 2001 to 788 million in 2006,
- in 1992 a debit-card payment was triple as costly as a cash payment
- in 1998 the debit-card payment with PIN was roughly twice as costly as a cash payment
- in 2006 the debit-card payment is almost the same price as a cash payment (20-18 cents in retail-environment),
so that now, at the end of 2007 it's safe to state that the full cost of Dutch debit-card payments to merchants are lower than cash payments (on a per transaction basis).
As a consequence, the retailer representative organisations advise all merchants to use the debit-card rather than cash and to stop old habits that date from earlier days: the surcharging for use of the debit-card. Because other research by the central bank shows that still 20 % of the retailers surchagre an amount of approximately 23 cents for payment wit a debit-card.
So one landmark achievement is that over here in the Netherlands we have started to beat cash in terms of real cost.
Comes with it another interesting development. One fifth of the retailers surcharges 23 cents for a debit-card transaction that costs them 20 cents. Leading to a 3 cent per transaction profit. The bank-side of this equasion is that banks sell their debit-card transaction for 5 cents, while it effectively costs them 13 cents (see McKinsey reports in 2005). Meaning that debit-card payments have turned into a profit maker for retailers and a bleeder for banks.
This makes you wonder why it would make sense for banks to still subsidize debit-card payments to merchants with a one cent per transaction 'efficiency-stimulus' as agreed in the 2005 Covenant.
The research outlines that:
- full cost of payments in retail are down from 839 million euro in 2001 to 788 million in 2006,
- in 1992 a debit-card payment was triple as costly as a cash payment
- in 1998 the debit-card payment with PIN was roughly twice as costly as a cash payment
- in 2006 the debit-card payment is almost the same price as a cash payment (20-18 cents in retail-environment),
so that now, at the end of 2007 it's safe to state that the full cost of Dutch debit-card payments to merchants are lower than cash payments (on a per transaction basis).
As a consequence, the retailer representative organisations advise all merchants to use the debit-card rather than cash and to stop old habits that date from earlier days: the surcharging for use of the debit-card. Because other research by the central bank shows that still 20 % of the retailers surchagre an amount of approximately 23 cents for payment wit a debit-card.
So one landmark achievement is that over here in the Netherlands we have started to beat cash in terms of real cost.
Comes with it another interesting development. One fifth of the retailers surcharges 23 cents for a debit-card transaction that costs them 20 cents. Leading to a 3 cent per transaction profit. The bank-side of this equasion is that banks sell their debit-card transaction for 5 cents, while it effectively costs them 13 cents (see McKinsey reports in 2005). Meaning that debit-card payments have turned into a profit maker for retailers and a bleeder for banks.
This makes you wonder why it would make sense for banks to still subsidize debit-card payments to merchants with a one cent per transaction 'efficiency-stimulus' as agreed in the 2005 Covenant.
Friday, December 07, 2007
Single market review forgets better regulation principles
This recent single market review is interesting in many ways. We can see that the Commission is selling Europe to the citizen. And bashing banks is always popular, so we can see that happening now as well. Without awaiting the results of a consultation on a report (that finds no evidence base on the exisence of a switching problem) the Commission wishes switching services to improve. In doing so it jumps to conclusions and forgets it's own better regulation principles.
This is not the best way forward. Let's relook the earlier committments of Commissioner Mccreevy on this matter:
Ladies and Gentleman, this Commission is taking a more variable, more modern approach to regulation. Strict adherence to better regulation principles. Wide consultation. Full impact assessments to ensure that initiatives are fully thought through. Legislation only where clear benefits are apparent.
And let's now proceed to see the real-life case of user mobility in the retail financial services area.
1. In the white paper on financial services, the Commission set up an expert group to discuss user mobility.
2. After one years work, the group concluded that there was no evidence base and no agreement between different stakeholders on the issue: is there a problem or not.
3. Then, the commission sent out a (coloured) consultation on the report, which already had a spin on it; assuming that there was a user mobility problem. But, the positive news still was that the Commission claimed to adhere to better regulation:
In line with Better Regulation principles and as a follow-up to the Group's work, the Commission is opening a public consultation on the Group's report. Stakeholders are invited to comment by 1 September 2007. Comments should also address the impact of the Group's recommendations and suggest any other ways to improve customer mobility in relation to bank accounts.
4. To top it of however, without awaiting the results of the consultation, without doing any impact assessment whatsoever, the single market review heads for a specific direction (asking the industry to do national things on switching services) that should normally be the result of the analysis in the impact assessment.
5. Given that the results of this expert group do not at all come in handy (as it acknowledges the need for a solid evidence base), the work of the expert group is completely left unmentioned.
6. So now the Commission moves ahead, will undoubtedly publish a press release to take things a further step forward ('inviting the industry to come up with national solutions to switching') without due consideration to the real facts and developments in the market.
Interestingly: if the analysis is that switching is not a pan European issue, it's not up to the Commission to act. Similarly, if there is no impact assessment, it's not up to the Commission to do anything else than make one. But then again, the Commission seems to think: a scare tactic always seems to work with banks, so let's see if we can move them in a direction by threatening, even if we put aside our own principles and follow gut-feeling rather than facts and due process.
Unfortunately this fits nicely into an earlier grim picture that I sketched on the true better regulation approach of the Commission. Which essentially was that it is about lipservice more than true service to the citizens of the Community.
This is not the best way forward. Let's relook the earlier committments of Commissioner Mccreevy on this matter:
Ladies and Gentleman, this Commission is taking a more variable, more modern approach to regulation. Strict adherence to better regulation principles. Wide consultation. Full impact assessments to ensure that initiatives are fully thought through. Legislation only where clear benefits are apparent.
And let's now proceed to see the real-life case of user mobility in the retail financial services area.
1. In the white paper on financial services, the Commission set up an expert group to discuss user mobility.
2. After one years work, the group concluded that there was no evidence base and no agreement between different stakeholders on the issue: is there a problem or not.
3. Then, the commission sent out a (coloured) consultation on the report, which already had a spin on it; assuming that there was a user mobility problem. But, the positive news still was that the Commission claimed to adhere to better regulation:
In line with Better Regulation principles and as a follow-up to the Group's work, the Commission is opening a public consultation on the Group's report. Stakeholders are invited to comment by 1 September 2007. Comments should also address the impact of the Group's recommendations and suggest any other ways to improve customer mobility in relation to bank accounts.
4. To top it of however, without awaiting the results of the consultation, without doing any impact assessment whatsoever, the single market review heads for a specific direction (asking the industry to do national things on switching services) that should normally be the result of the analysis in the impact assessment.
5. Given that the results of this expert group do not at all come in handy (as it acknowledges the need for a solid evidence base), the work of the expert group is completely left unmentioned.
6. So now the Commission moves ahead, will undoubtedly publish a press release to take things a further step forward ('inviting the industry to come up with national solutions to switching') without due consideration to the real facts and developments in the market.
Interestingly: if the analysis is that switching is not a pan European issue, it's not up to the Commission to act. Similarly, if there is no impact assessment, it's not up to the Commission to do anything else than make one. But then again, the Commission seems to think: a scare tactic always seems to work with banks, so let's see if we can move them in a direction by threatening, even if we put aside our own principles and follow gut-feeling rather than facts and due process.
Unfortunately this fits nicely into an earlier grim picture that I sketched on the true better regulation approach of the Commission. Which essentially was that it is about lipservice more than true service to the citizens of the Community.
Wednesday, November 21, 2007
Sunday, November 04, 2007
Skimmers detected this morning
Nice article in newspaper: attentive customers discovered skimming device on an ING ATM. See also the two foto's:
foto 1
foto 2
foto 1
foto 2
Tuesday, October 16, 2007
Payments: The Clash of Banks, PayPal - 10.01.2007 - American Banker Print Article
Nice article here:Payments: En Garde! The Clash of Banks, PayPal. How to judge Paypal...?
Many EU observers often claim the e-money directive hasn't worked at all, allowing only 15 competitors market entry in 5 years. So hasn't it worked? Future will demonstrate how wrong those observers are. Paypal has used the e-money regulation as a stepping stone for it's current banking license in Luxembourg. And will now use the banking license to further skim the banking market.
Meanwhile banks struggle with legacy systems, legacy thinking and legacy regulators... so here's definitely a revolution in the making.....
Many EU observers often claim the e-money directive hasn't worked at all, allowing only 15 competitors market entry in 5 years. So hasn't it worked? Future will demonstrate how wrong those observers are. Paypal has used the e-money regulation as a stepping stone for it's current banking license in Luxembourg. And will now use the banking license to further skim the banking market.
Meanwhile banks struggle with legacy systems, legacy thinking and legacy regulators... so here's definitely a revolution in the making.....
Payments and Settlements News 53
Payments and Settlements News 53 is out now with:
News and events:
· Eurosystem – SEPA signing events at Sibos 2007
· European Commission – EU-Pay pilots launched
· ESCB - "TARGET2 is targeting start of operation"
· SEPA - European payment processors in interoperability pact
· European Commission - VISA fined for Morgan Stanley exclusion in the United Kingdom
· National Bank of Belgium - "The Single Euro Payments Area: SEPA"
· De Nederlandsche Bank - "Navigating towards SEPA: the transition to European payment instruments in the Netherlands"
· PCI Security Standards Council - administering PIN Entry Device (PED) Security Requirements
· NACHA - fee structure for Secure Vault Payments announced
· United States – Update on Revolution Money
Articles, speeches and reports:
· European Commission - "Improving the competitiveness of European card-based payments", speech by Charlie McCreevy
· Sveriges Riksbank - "The Costs of Paying – Private and Social Costs of Cash and Card Payments"
· National Bank of Belgium - "Financial Stability Review 2007"
· Suomen Pankki - "A qualitative study to identify factors that influence Finnish consumers to change their payment behaviour"
· De Nederlandsche Bank - "Overview of Financial Stability in the Netherlands"
· "Mobile Payment Models and Their Implications for NextGen MSPs"
· gtnews - "Prepaid Cards: a Payments Revolution"
· Innopay - "Understanding buyer and seller behaviour for improved payment product development"
· Fed Kansas City - "Complex landscapes: Mobile
· payments in Japan, South Korea and the United States"
· Fed New York - "Technology Diffusion within Central Banking: The Case of Real-Time Gross Settlement"
· Fed Chicago - "Using Payment Innovations to Improve Transportation Networks"
· Fed Boston - "Consumer Payments Research: Industry Reference Guide"
· Fed Boston - "Mobile Phone: The New Way to Pay?"
· United States - "Why Once-Soaring Contactless Payment Has Lost Some Altitude"
· Reserve Bank of New Zealand - "Payments and the concept of legal tender"
· Bank of Japan - "Payment Flows for Settlement of Foreign Exchange Trades: Japan's Experience since 2002"
· Reserve Bank of Australia - Payments System Board Annual Report 2007
News and events:
· Eurosystem – SEPA signing events at Sibos 2007
· European Commission – EU-Pay pilots launched
· ESCB - "TARGET2 is targeting start of operation"
· SEPA - European payment processors in interoperability pact
· European Commission - VISA fined for Morgan Stanley exclusion in the United Kingdom
· National Bank of Belgium - "The Single Euro Payments Area: SEPA"
· De Nederlandsche Bank - "Navigating towards SEPA: the transition to European payment instruments in the Netherlands"
· PCI Security Standards Council - administering PIN Entry Device (PED) Security Requirements
· NACHA - fee structure for Secure Vault Payments announced
· United States – Update on Revolution Money
Articles, speeches and reports:
· European Commission - "Improving the competitiveness of European card-based payments", speech by Charlie McCreevy
· Sveriges Riksbank - "The Costs of Paying – Private and Social Costs of Cash and Card Payments"
· National Bank of Belgium - "Financial Stability Review 2007"
· Suomen Pankki - "A qualitative study to identify factors that influence Finnish consumers to change their payment behaviour"
· De Nederlandsche Bank - "Overview of Financial Stability in the Netherlands"
· "Mobile Payment Models and Their Implications for NextGen MSPs"
· gtnews - "Prepaid Cards: a Payments Revolution"
· Innopay - "Understanding buyer and seller behaviour for improved payment product development"
· Fed Kansas City - "Complex landscapes: Mobile
· payments in Japan, South Korea and the United States"
· Fed New York - "Technology Diffusion within Central Banking: The Case of Real-Time Gross Settlement"
· Fed Chicago - "Using Payment Innovations to Improve Transportation Networks"
· Fed Boston - "Consumer Payments Research: Industry Reference Guide"
· Fed Boston - "Mobile Phone: The New Way to Pay?"
· United States - "Why Once-Soaring Contactless Payment Has Lost Some Altitude"
· Reserve Bank of New Zealand - "Payments and the concept of legal tender"
· Bank of Japan - "Payment Flows for Settlement of Foreign Exchange Trades: Japan's Experience since 2002"
· Reserve Bank of Australia - Payments System Board Annual Report 2007
Zaypay, a new 'Paypal voor mini-payments'
M-payments service provider Mollie will enter the market with Zaypay, a payment system for small valure payments (below 1 euro). They view themselves, according to this Emerce article as the 'Paypal for mini-payments' and will launch next month. All non-regular payments (sms, 0900, Wallie etc) will be supported as well as iDeal.
Friday, October 05, 2007
Barclays withdraws Offer for ABN AMRO
Well, another story begins to end. See the ABN AMRO Press Release that outlines that Barclays withdraws Offer for ABN AMRO.
Wednesday, October 03, 2007
Elf arrestanten lid van Oost-Europese groep
Het Parool - Archief
Elf arrestanten lid van Oost-Europese groep
Skimmerbende opgerold PAUL VUGTS
AMSTERDAM - Met elf arrestaties heeft de Amsterdamse recherche dit weekeinde een belangrijke tak van een professioneel opererende bende 'skimmers' opgerold. Deze afdeling van de Oost-Europese groepering verdiende met pinpasfraude dit jaar aanzienlijke bedragen.
De recherche volgde de groep al geruime tijd. Het nu opgerolde onderdeel van de internationale organisatie is in elk geval verantwoordelijk voor inbraken in zes tuincentra, bouwmarkten en wegrestaurants in Amsterdam en wijde omgeving. Waarschijnlijk moeten ook inbraken elders in het land aan de bende worden toegerekend.
Elf arrestanten lid van Oost-Europese groep
Skimmerbende opgerold PAUL VUGTS
AMSTERDAM - Met elf arrestaties heeft de Amsterdamse recherche dit weekeinde een belangrijke tak van een professioneel opererende bende 'skimmers' opgerold. Deze afdeling van de Oost-Europese groepering verdiende met pinpasfraude dit jaar aanzienlijke bedragen.
De recherche volgde de groep al geruime tijd. Het nu opgerolde onderdeel van de internationale organisatie is in elk geval verantwoordelijk voor inbraken in zes tuincentra, bouwmarkten en wegrestaurants in Amsterdam en wijde omgeving. Waarschijnlijk moeten ook inbraken elders in het land aan de bende worden toegerekend.
Monday, October 01, 2007
The beginning of the end: blocking payments for gambling...
Quite interesting both the US officials (Treasury and Fed) see proposed rule here and the Dutch government seek to stop 'unlawful betting practices' by demanding the banks that execute the payments to block those.
Well, if we go down this road and allow our governments to dictate which payments which customers may send/acccept (and instruct our banks to act accordingly), we may as well make the Treasuries our single national payment institution. This is what in my view will happen.
First the rules will be targeted to situations to which no one can protest: companies that sell child porn. This will get the first round of regulation off the ground.
Then the question will be: can we also stop payments to/from betting companies? Which is not so easy: in the Netherlands all non-Dutch government agreed betting (from abroad) is viewed as illegal. But that is a political judgment call, stemming from the fract that our government earns money from some of those companies that it has provided a betting license with. With a little luck, you also get this second round of rules agreed.
Third, we will see how it's not the national government prescribing to block payments to/from specific companies/customers, but local police officers or DA's. And they'll also be allowed to automatically fine the users that try to make payments to those companies that are considered blacklisted. Because those users are doing something illegal too....
Now, while this last scenario appears politically impossible now, it won't be once we're used to the first two interventions.
It is quite bluntly a disgrace that politicians and policymakers so improperly and so recklessly invade our privacy and dictate our and the banks' behaviour. If the bottom line is that police officials are not sufficiently equipped to catch crooks... fine, provide them with more resources. But don't try short-cutting it with using tools/means that will only end up backfiring at some point in time.
Or as Kant would say it, put yourself in the position of the other and question yourself once again if the proposed ruling is fair to all involved...
Well, if we go down this road and allow our governments to dictate which payments which customers may send/acccept (and instruct our banks to act accordingly), we may as well make the Treasuries our single national payment institution. This is what in my view will happen.
First the rules will be targeted to situations to which no one can protest: companies that sell child porn. This will get the first round of regulation off the ground.
Then the question will be: can we also stop payments to/from betting companies? Which is not so easy: in the Netherlands all non-Dutch government agreed betting (from abroad) is viewed as illegal. But that is a political judgment call, stemming from the fract that our government earns money from some of those companies that it has provided a betting license with. With a little luck, you also get this second round of rules agreed.
Third, we will see how it's not the national government prescribing to block payments to/from specific companies/customers, but local police officers or DA's. And they'll also be allowed to automatically fine the users that try to make payments to those companies that are considered blacklisted. Because those users are doing something illegal too....
Now, while this last scenario appears politically impossible now, it won't be once we're used to the first two interventions.
It is quite bluntly a disgrace that politicians and policymakers so improperly and so recklessly invade our privacy and dictate our and the banks' behaviour. If the bottom line is that police officials are not sufficiently equipped to catch crooks... fine, provide them with more resources. But don't try short-cutting it with using tools/means that will only end up backfiring at some point in time.
Or as Kant would say it, put yourself in the position of the other and question yourself once again if the proposed ruling is fair to all involved...
Friday, September 21, 2007
Postbank puts link to Virus Remover from Kaspersky on its web
The attacks on banks continue in cyberspace. And to such an extent that Postbank found the need to warn its users to check their PC and use the Postbank Virus Remover by Kaspersky Lab. Apparently the virus listens for the inlog-code and later on asks for tan-codes to be used in transactions.
Well, we've come a long way since in 1995 or 1996 first virtual demonstrates that it was easy to eavesdrop on the web. By now First Virtual is long gone and the eavesdropping is done professionally. And the importance of user education increases per minute.
Well, we've come a long way since in 1995 or 1996 first virtual demonstrates that it was easy to eavesdrop on the web. By now First Virtual is long gone and the eavesdropping is done professionally. And the importance of user education increases per minute.
Chipknip to disappear from manned-retail locations
Many papers and the national news discussed the ending of the Chipknip in manned retail loactions. Among them also Het Financieele Dagblad. All merchants are advised to just use the debit-card for low value payments, which is by now just as cheap as the e-purse (developed in a time when off-line payments were considered to be a smart way to circumvent the high telecommunication costs).
So, since the 10 years of its existence, the merchants didn't pick up the Dutch e-purse, which is partly due to the product characteristics. Consumers don't appear to like loading the card and keeping track of its balance. But then again, the use in parking, vending and catering niches is quite considerable. Th benefits of not having to collect coins at home for use in those machines clearly outlines the hassle of loading a Chipknip. So in these segments the Chipknip will survive.
Yet, we should also not forget the headlines of 10 years ago. Merchant lobby groups at that point of time explicitly stated that they were going to boycot the use of the Chipknip in the stores. Well, they lived up to their promise. It would be interesting to know if Neelie Kroes or any of her staff at DG Competition would also consider such collectively enacted boycots an abuse of dominant market position ?
So, since the 10 years of its existence, the merchants didn't pick up the Dutch e-purse, which is partly due to the product characteristics. Consumers don't appear to like loading the card and keeping track of its balance. But then again, the use in parking, vending and catering niches is quite considerable. Th benefits of not having to collect coins at home for use in those machines clearly outlines the hassle of loading a Chipknip. So in these segments the Chipknip will survive.
Yet, we should also not forget the headlines of 10 years ago. Merchant lobby groups at that point of time explicitly stated that they were going to boycot the use of the Chipknip in the stores. Well, they lived up to their promise. It would be interesting to know if Neelie Kroes or any of her staff at DG Competition would also consider such collectively enacted boycots an abuse of dominant market position ?
Rabobank introduces challenge response token for the visually impaired/blind users
See this Techzine article: Rabobank will help the visually impaired by providing them with a bigger, audio-equipped device that acts as the regular challenge-response token that internet-bankers use. It's a sign that in mature e-banking markets (over 2/3rds of the Dutch now bank via the internet and pc) the tools are now being developed to serve and include the not-so-trivial target groups.
Tuesday, August 28, 2007
Mastercard to reconsider ad valorem based fee plan in UK...
See the website of the British Retail Consortium to read that Mastercard planned for a new approach to debit card interchange charging but was stopped by retailers...
In the UK retailers currently pay a fixed fee on debit card transactions regardless of the value of the transaction. Rates range from 6 pence to 18 pence, depending on which card it is and where and how the transaction occurs, but the fee on a £20 transaction is the same as for a £100 transaction.
For this new debit card MasterCard wanted to introduce percentage, or so-called ad valorem, fees. It wanted to charge a fixed fee of 3.5 pence plus 0.15 per cent of the purchase price.
It's intruiging: the attempts of debit card schemes to go for the ad valorem fee structures for payments where actual value (in terms of cost) does not influence the cost of the transaction....
In the UK retailers currently pay a fixed fee on debit card transactions regardless of the value of the transaction. Rates range from 6 pence to 18 pence, depending on which card it is and where and how the transaction occurs, but the fee on a £20 transaction is the same as for a £100 transaction.
For this new debit card MasterCard wanted to introduce percentage, or so-called ad valorem, fees. It wanted to charge a fixed fee of 3.5 pence plus 0.15 per cent of the purchase price.
It's intruiging: the attempts of debit card schemes to go for the ad valorem fee structures for payments where actual value (in terms of cost) does not influence the cost of the transaction....
Saturday, August 25, 2007
ABN Amro employees don't wish to be sold out to bidders...
See the RTL news that outlines that a huge ABN AMRO survey outlines that 55 % wishes ABN AMRO to be independent. And 39 % chooses Barclays over 6 % Fortis. So the labour unions will now ask the ABN AMRO Board of Directors to conduct an investigation into that independent scenario.
Again, we should recognize that even ABN AMRO employees may not have the full overview and details on the new situation and the mergers. They oppose to being split up. And I was just going to link to the ABN AMRO investor relations website to illustate that ABN AMRO has repeatedly split up and reorganised itself over the past years (without a lot of succes). And all the time the employees representatives did not ask their Board to self-reflect on the wisdom of such actions. But now they do oppose to outsiders that will do exactly the same.
Too bad that I can't make the whole argument right now, as the ABN AMRO investor relation website is completely down... ... which makes me wonder: would there be a silent take-over going on ... beginning as we speak with the website....?
Again, we should recognize that even ABN AMRO employees may not have the full overview and details on the new situation and the mergers. They oppose to being split up. And I was just going to link to the ABN AMRO investor relations website to illustate that ABN AMRO has repeatedly split up and reorganised itself over the past years (without a lot of succes). And all the time the employees representatives did not ask their Board to self-reflect on the wisdom of such actions. But now they do oppose to outsiders that will do exactly the same.
Too bad that I can't make the whole argument right now, as the ABN AMRO investor relation website is completely down... ... which makes me wonder: would there be a silent take-over going on ... beginning as we speak with the website....?
Friday, August 24, 2007
How socialist save the capitalist ABN AMRO for Barclays...:
This week it appears as if everyone understands and has an opinion on mergers and takeovers in the financial markets. Members of provincial representative fora voiced their opinion that they thought ABN AMRO should not be sold to the consortium as that would incur too much risks. And similar tidings/thoughts come from the left-wing socialist party (former mao-ists) that even want to discuss the takeover stuff with the Minister of Finance (before the moment where he provides his statement of no-objection....).
While I myself know that the complexity of such a takeover is so huge, that one wouldn't want to consider meddling with it (let alone voice an opinion) it is intruiging to note in this analysis that left wing socialists now help out Mr Groenink in keeping an executive seat with the Barclays combination. Analyst Jeroen de Boer actually calls this a devils' pact.
It's a bit of media-logics here. A lot of people, representative organisations or politicians seek attention. So they choose a news topic (such as ABN AMRO) and then device an angle to ride-along on the news wave and be connected to the issue. One of the nicest examples in this respect: the organisation for the gay voiced their opinion on the merger and outlined that ABN AMRO should continue their gay-friendly policies. Completely off topic and highly irrelevant to the takeover debate, but absolutely brilliantly done.
While I myself know that the complexity of such a takeover is so huge, that one wouldn't want to consider meddling with it (let alone voice an opinion) it is intruiging to note in this analysis that left wing socialists now help out Mr Groenink in keeping an executive seat with the Barclays combination. Analyst Jeroen de Boer actually calls this a devils' pact.
It's a bit of media-logics here. A lot of people, representative organisations or politicians seek attention. So they choose a news topic (such as ABN AMRO) and then device an angle to ride-along on the news wave and be connected to the issue. One of the nicest examples in this respect: the organisation for the gay voiced their opinion on the merger and outlined that ABN AMRO should continue their gay-friendly policies. Completely off topic and highly irrelevant to the takeover debate, but absolutely brilliantly done.
The PayPal Blog: Observing Trends in the Payments Industry
Interesting article here on Payment industry trends on the PayPal Blog. Essentially the trends are:
- cash will lose out slowly
- convenience will make the customer chose for debit
- rewards are what matters in a saturated market.
Well, the first two are clear; I'm not sure about the third one. There's bound to remain a lot of national culture in payments. So the decisive factor in a saturated market can take a variety of forms, not necessarily being rewards. But for example the eco-image of the provider, the image of a brand, the actual customer service if stuff goes wrong, or perhaps price.
Still, an interesting article by Dan Schatt.
- cash will lose out slowly
- convenience will make the customer chose for debit
- rewards are what matters in a saturated market.
Well, the first two are clear; I'm not sure about the third one. There's bound to remain a lot of national culture in payments. So the decisive factor in a saturated market can take a variety of forms, not necessarily being rewards. But for example the eco-image of the provider, the image of a brand, the actual customer service if stuff goes wrong, or perhaps price.
Still, an interesting article by Dan Schatt.
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