101 Blog… probably not for the BNPL experts. Recap at bottom.
While CDBC may impact debit networks in a 5 yr view, I thought I would write a short blog on BNPL’s impact to credit networks in near term (See Insider’s BNPL market Analysis and MRC’s overview of solution providers)
As always pardon the typos
It seems like only yesterday that 30 members of Congress wrote the acting chairman of the FDIC to stop Walmart Bank.
“Wal-Mart’s plan, to have its bank process hundreds of billions in transactions for its own stores, could threaten the stability of the nation’s payments system,”
30 Members of US Congress, March 2006
Of course, we all know that Walmart pursued a different course to deliver services. Partnerships (MGI, Moneygram, Paypal, …) and banking in a box (literally an isle with prepaid cards). Most analysts discount or “write off” Walmart’s achievements in financial services. Given Walmart doesn’t break out financial performance of Money Center, analysts are left with the tea leaves of MGI and GDOT reports. There is little doubt that comparing Money Center financial metrics to tier 1 banks would leave most unimpressed. However, Walmart has created a portfolio of banking services that supports their overall retail strategy and creates overwhelming loyalty amongst their core customer base.
Happy New Year! Best to you and yours. Having completed the successful sale of Commerce Signals to Verisk last year, this blog is a reflection on some of my lessons learned as well as my predictions on where I see things headed. The thoughts here are guiding my investments and launch of my next venture. I love the interaction, so please take time to write a comment on any of this. Also I ask for your pardon in advance for typos..
Understanding flows of data, and the structures in which it is controlled, provides a map of: value, power and margin. What is changing in the flow of data? What data is still “unique”? Where is power shifting? My past blogs referred to this dynamic as Rewiring Commerce, Value Orchestration and the Transformation of Commercial Networks.
Google just completed a massive “relaunch” of Google Pay this week.
Recommend you read either of these 2 articles to get the details. There are 4 key elements in the launch
Summary – Google is not becoming a bank, but rather enabling:
Over last 6 months or so we have seen several Press Releases relating to Google’s bank partnerships:
“We had confirmed earlier that we are exploring how we can partner with banks and credit unions in the U.S. to offer digital bank accounts through Google Pay, helping their customers benefit from useful insights and budgeting tools, while keeping their money in an FDIC or NCUA-insured account,” stated the release.
Smart, according to Google, because it will provide its checking accountholders with money management tips to optimize and manage the funds in those accounts – funds linked to payments and identity credentials that consumers can use to buy things, pay bills and send money to others in and outside the Google ecosystem.
Given yesterday’s blog on Open Banking, Open Payments and Trust Networks I can’t resist writing on what I believe was the greatest, most innovative, trust network in the last 20 years: Libra. David Marcus’ design of Libra is brilliant, and will stand as THE REFERENCE MODEL for creating a trust network (apart from a market).
A blog to my bank friends. Sorry for typos.. feedback appreciated!
Thought for the day
Open systems garner greater participation, but margins are held either by orchestrator or proprietary components that offer unique performance or capabilities. Payments and Banking are trust networks, trust requires not only enforceable and auditable assessment of counterparty operations, but a shared business case for investment.
Trust networks revolve around a shared and enforceable definition of roles, standards, counterparty identity, trust and risk. Trust network attributes and operating model drive scale and participant investment. In all cases, networks require participation of both consumer and merchant. A trust network of known participants operating within a defined set of operations and economics stands in stark contrast to the open, anonymous and distributed internet (see Transformation of Commercial Networks).
Today we will take a look at Open Banking and Open Payments. If you are looking for the summary, here it is: