Payments, Payments Everywhere!
While there have been a variety of news announcements this month, I feel like I have spent the past week simply covering payments. And I'm not complaining; payments is my favorite fintech sub-sector because it impacts every single adult across the globe, in every asset class.
For the past year or so, the news headlines have been touting developments in pay-by-bank, especially in Europe. And the U.S. CFPB's release of the final 1033 rule-making this week has the potential to make pay-by-bank usage much more prevalent in the U.S. That's because pay-by-bank relies on the power of open banking to remove friction from the user experience.
There is one element of pay-by-bank that is missing, however, that will slow its adoption-- consumer rewards. Both banks and merchants stand to benefit significantly when shoppers choose to pay using a bank draft instead of a credit card. However, those users may not be willing to sacrifice their credit card points, cashback, or miles just to transact in a way that is less expensive and more secure for the merchant. In fact, some shoppers may view a pay-by-bank transaction as less secure than a credit card transaction, since the former offers access to their entire bank account, while the latter provides dispute resolution process they are likely familiar with.
I do think pay-by-bank has its place in banking, but adoption may be slower than many are anticipating, even in a post-1033 landscape.
I'm Julie Muhn, bringing you today's fintech news-- both payments and non-payments related. And in case you want to talk about payments (or any other fintech topic) in person, I'll be attending Money20/20 next week, so feel free to send me a note to meet up!
Weekly news
In case you missed them, here are the payments-related headlines of the past couple of weeks:
Mastercard to offer real time cross-border payments for commercial clients.
Ripple challenges industry giants with new stablecoin.
Stripe participates in stablecoin mania
"Stablecoin mania" may be a bit of a dramatic way to phrase it, but with Stripe, Ripple, and Circle all making major investments in the stablecoin space this month, the U.S. could be poised for an uptick in stablecoin activity.
My piece this week considers how Stripe's foray into stablecoins may impact the U.S. stablecoin market.
Recommended by LinkedIn
Pause Button: Larch Madness
If you have ever spent time in a larch forest in the fall, then you may be familiar with the uniqueness of these trees. Also known as a tamarack tree, the larch species is classified as a deciduous conifer, meaning that the tree sheds its needles in the autumn, just as broad-leaved trees drop their leaves. The result is a gold and green hillside with delicate larch needles blanketing the forest floor.
In the winter, however, these trees stand bare, and will look dead, especially when they stand next to traditional conifer trees such as lodgepole pine or douglas fir. Unlike dead trees, living larch trees are highly resistant to fire. Their thick bark that sheds when consumed by flames, helps protect the inner layers of the tree.
The larch tree's cycle of transformation-- from shedding its golden needles to standing firm in the harsh winter-- is a testament to its resilience and adaptability. Beneath its quiet, bare appearance lies a strength designed to weather even the most formidable conditions; a great reminder that looks can be deceiving.
FinovateEurope demo call!
Know a fintech that would be great at demoing its technology on stage in front of one of banking's largest audiences? Now is the time for them to apply to demo at FinovateEurope, which is taking place on February 25 through 26, 2025 in London.
Apply to demo today to secure your slot before they are filled!
The demo package offers great value, but you don't have to take my word for it. Here are some thoughts from past participants:
We’ve been watching FinovateEurope for a long time. It’s a great show. It’s an opportunity where you can’t hide behind a sales slide deck. You actually have to show the quality of your product.
- Richard Weston, Sales Director @ Tuum
Finovate’s somewhere that we really come to actually show new products and developments in our technology, and we’ve got the right audience here of bankers, buyers, and actual potential tech partners.
-Ambar Vitelli, Innovation Lead @ NayaOne
The reason that we wanted to be on stage at Finovate was because it’s really one of the best opportunities to speak to such a broad variety of senior leaders across banking and insurance.
-Tom Somers, UK&I Director @ SkenerioLab
Header photo by Nataliya Vaitkevich
Stripe photo by Scott Webb
Larch photo by Anton Volnuhin on Unsplash