eCom – Politics and Scenarios

Frank Young – Contributor

What are banks talking about this week? How did Apple’s announcement impact them? While 15bps on 2% of eCom GDV is a nuisance, 15bps on 15% of eComm GDV is an earthquake. 

You need to be logged in to view the rest of the content. Please . Not a Member? Join Us

Apple Wallet “2.0” in iOS18 – What’s In It?

Winners: Consumers, Merchants, Banks, Networks and Affirm

Losers: Branded PayPal and Venmo

Apple’s WWDC is on Day 2. Today we will see significant enhancements to ApplePay and Wallet in forthcoming iOS18 (to be released this fall). Here are the highlights in order of impact. 

1 – ApplePay in eCom

ApplePay will be supported in every browser. This will be a game changer and dramatically increase payment volume flowing through Apple wallet (and their platform). Just last week, the WSJ published a great piece on why retailers hate that consumers make large purchases on their computers. Apple will expand ApplePay to support all browsers AND provide a major upgrade in experience, security and fraud. 

Continue reading

Bank Transformation – Actions for Banks to Succeed in the Storm of Disruption

A Framework for Collaboration – Taking Part in Consumer Journeys

16 Page Blog – 3 Page Exec Summary 

Part 2 of Future of Retail Banking (2023). This blog has been sitting at 60% for 2 months now. Sorry for the delay.  A bull case for V/MA and service expansion.

A storm is brewing that will dwarf the impact the internet (V1/V2) had on established business models. There are multiple transformations occurring simultaneously: AI/ML, Web3, Digital ID, DLT, open mandates, FinTech, Wallets, ….etc. (see Web3 and Small Wins). While large orchestrators and big tech dominate today due to their virtuous cycles, new forces push for the “break up” of Big Tech and centralized data stores to make the internet more democratic and more privacy friendly.

You need to be logged in to view the rest of the content. Please . Not a Member? Join Us

Visa Expands the Pipe

Flexible Credentials

© Starpoint LLP, 2024. No part of this site, blog.starpointllp.com, may be reproduced or retransmitted, in whole or in part, in any manner without the permission of the copyright owner.

Background

Visa’s network is the largest commercial network in the world, moving over $15T in volume over 4.3B cards in over 200 countries. Visa’s core is called VisaNet, a real-time messaging network between banks. They don’t move money but send instructions to and from banks, merchants, consumers and other approved third parties. The banks move the money, primarily through net settlement on ACH.  The beauty behind Visa’s network is its operating model, which allows thousands of partners to invest billions of dollars. To defeat Visa, you not only have to create a better network, but you must also create a better economic model for EVERYONE to switch, AND overcome the combined investment of all current stakeholders. This is why SEPA failed (see Power of Bank Networks). 

You need to be logged in to view the rest of the content. Please . Not a Member? Join Us

Short Blog – DOJ/Apple and Visa/MA Settlement

Apple/DOJ

Updated 3/28 to cover Honor All Wallets

Most of us saw the news on Friday that “The Justice Department, 15 states and the District of Columbia sued Apple on Thursday, alleging the tech giant makes it difficult for competitors to integrate with the iPhone” – WSJ 3/21

You need to be logged in to view the rest of the content. Please . Not a Member? Join Us

CapOne Buys Discover

Quick Take

Discover has been looking for a buyer for some time. Back in 2012 they were the launch partner for the Google Plastic card and positioned the opportunity with Google. While Google was interested in the network, there was no interest in taking on banking licenses and credit risk. Finding a buyer for the BUNDLE of Discover was their ongoing problem, with many BigTechs interested in the network only. 

You need to be logged in to view the rest of the content. Please . Not a Member? Join Us

PayPal Innovation Opportunity – “All In” on the Consumer

I’m usually just a cynic. Today, I’m constructive with specific suggestions for PayPal’s new executive team. Note that about 80% of your large institutional investors will read this.. 

Exec Summary

  • Wallets are a core battlefield for Issuers, BigTech, marketplaces, and governments.
  • PayPal’s previous “super app” strategy failed because there was no clear consumer value proposition.
  • The most significant consumer value proposition to be unlocked is the unbundling of financial services, with the wallet providing the common UI to manage the complexity. In this future state, a “super wallet” would enable bank competition for every account and every transaction.
  • PayPal is well positioned to execute on a super wallet, but it must go ALL IN on a consumer-focused value proposition without regard for issuer relationships. 
  • For example, Curve is the best-in-class Wallet providing aggregation, transaction, loyalty and analytics across all account types, networks, POS, eCom, P2P and banking services. 

You need to be logged in to view the rest of the content. Please . Not a Member? Join Us

New Blog Series – The Economic Models of Identity (and Trust)

Free Content

Happy New Year. I’m starting a new blog series in 2024 – The Economic Models of Identity. 

Identity is the #1 shaping force in new payment schemes, Web3, blockchain/crypto and more broadly “trust” interactions in government, commercial and social (see Trust Networks). Most investors haven’t spent much time thinking about identity because it was the realm of tech geeks or bundled into the services we use (see Separating Identity and Payments). The reason to pay attention today? Identity is shaping a redesign of the internet’s infrastructure AND governments are defining new LAW on what constitutes a digital identity (ex India’s UIDAI and Europe’s eIDAS/eID).

Let’s unpack the word Idenitity to ensure a consistent taxonomy. While most people relate a drivers license or passport to identity, it is much more than that. Who are you? And who can answer that question? Are you a US citizen? Licensed Driver? Doctor? Skier?  Great credit risk? While your SSN or DL# are legally issued identitiers that only the government can issue and authenticate, you are also biometrically defined and have credentials, behaviors, preferences and other attributes. Identity and the contexts in which it is used are the foundation of trust, contracts and relationships. 

Continue reading

Adios 3DS “Step up”.. Hello FIDO2

Short Blog

There are significant changes brewing in eCommerce authentication and authorization. Today’s blog is more of a headline summary of key points that I hope to break down over Thanksgiving. 

You need to be logged in to view the rest of the content. Please . Not a Member? Join Us