Zippay mobile payments service logo launched by Irish banks

RETAIL BANKING HEADLINES

Ireland's main banks Bank of Ireland, Allied Irish Banks and Permanent TSB will launch a mobile payments service early next year which has been developed by Italian paytech Nexi. Is it part of Wero, the Europe-wide payments initiative? Hard to tell at this point, though Nexi became a merchant acquirer in Germany for EPI and Wero. The new service Zippay will be available inside the bank apps, and Nexi operates as a merchant acquirer for Wero so there's some connection there. This launch comes after a previous attempt to provide a standalone app backed by the main Irish banks failed back in 2023. The press announcements stress that once Zippay has been launched to the main banks, it will be available on a 'non-discriminatory basis' to other financial institutions offering Irish IBANs. The previous attempt to launch a mobile app between the banks was widely seen as an attempt to compete with Revolut. As in many places, customer loyalty is fragmenting in Ireland, as many people keep the traditional bank for salaries and mortgages, but do their payments through Revolut. With the new service, customers will be able to send money to anyone in their phone contacts that has an account with the main banks, but using only the phone number. Users will be automatically enrolled. Public reaction has been quite comical so far, and it's safe to say the public is not impressed, with the idea that it will rival Revolut being roundly mocked.

Greece gets a new neobank this week, if that's not a tautology. Snappi was created by Piraeus Bank, software business Natech and Neptune International. "In a noted turn away from latest industry trends, a launch statement confirms that Snappi maintains 'no bot-reliance, no scripts, no outsourcing' through its customer support channels, claiming to be 'one of the very few neobanks in Europe to do so'." CEO Gabriella Kindert said: "With strong local roots in Greece and an international outlook, we're part of a new generation of neobanks designed to be flexible, inclusive, and genuinely helpful day to day." The bank said it was Greece's first fully-digital bank, (although there are other digital banks operating in Greece including N26 and Revolut), and will compete with the likes of fintech Woli and Vivabank, which also claimed to be Greece's first fully-digital bank. Piraeus Bank, founded by shipowners in 1916, is the largest bank in Greece with 30 per cent of the lending market and 29 per cent of deposits.

Did you ever think you would that look back fondly on the days when everyone was just on Facebook? Nowadays you need to also keep track of your Instagram, TikTok, LinkedIn, Truth Social, Discord, X, BlueSky, Threads, and several WhatsApp groups. The trend among younger people is to establish smaller social networks on Discord and avoid all the drama of the big networks. The fracturing of online social networks continues apace, to the extent that Robinhood is now launching its own social network. Growing retail investment business Robinhood says that "it is becoming harder to understand what's real and what isn't on these platforms," so it plans to launch its own social network. But why would it find other social networks unreliable? New research shows that Reddit is a top source of information for AI bots, which is slightly alarming in itself, since AI bots also now seem to be produce a vast amount of the new content on social networks. You might hear the term AI slop, and you'll have started to notice a lot of similar looking AI-generated images. The Reddit forum WallStreetBets became a major player in retail investment in recent years as day traders piled in on 'meme stocks' such as GameStop. Maybe Robinhood is on to something? The plan for its network is that "Users can post their trades for others to see unfold live, discuss strategies, and follow other traders. It is also possible to check the one year and daily profit and loss and profit rate of others, as well as follow insiders, hedge funds, and politicians," reports Finextra, which says the service will launch to invited users in the US early next year.

If history is any guide, 'Responsible lending' and 'subprime lending to people with no credit history' doesn't really belong in the same sentence, but here we are again. (The 'democratisation of finance' often turns out to mean lending to people that can't afford it.) US subprime lender Tricolor filed for bankruptcy this week and Department of Justice officials are looking into allegations of fraud at the major US subprime car finance business, which looks like it will have major cost implications at major banks JPMorgan, Barclays and Fifth Third, who provide the capital. "One area of focus was whether Tricolor pledged the same collateral on multiple loans, two separate people familiar with the matter said," the FT reports. "Funds managed by BlackRock had also invested $90mn into the lender in 2021, as part of the asset manager's push into 'responsible lending' to underserved communities." Tricolor buys and sells cars and was a major lender to lower-income Hispanic customer with little or no credit history.

The Office of the Comptroller of the Currency is launching new guidance to discourage banks from "debanking," customers on political and religious grounds, a month after President Donald Trump directed oversight agencies to scrutinize banks for political bias, reports Reuters. "The Office of the Comptroller of the Currency (OCC) said in a statement it had issued two bulletins explaining how it would scrutinize bank policies for avoiding such discrimination and how banks should limit sharing of customer data in reporting suspicious activity to government authorities."The issue of debanking arose first with UK politician Nigel Farage, costing NatWest's CEO her job, and then surfaced in the US. "(US President Donald) Trump last month also accused JPMorgan and Bank of America without citing evidence, of refusing his deposits on political grounds. Neither bank directly addressed his claims, but JPMorgan said it did not close accounts for political reasons." Silicon Valley leaders including Marc Andreessen have also been vocal on the issue when it relates to cryptocurrency businesses, although new legislative changes and support from the White House mean those players are now more insiders than outsiders.

PAYMENTS NEWS

Stripe is the main player behind the launch of Tempo, a new payments service that appears to have learned a lot from previous ventures into the payments blockchain space such as Facebook's Libra. Get past the blockchain conference's worth of obscure technical terminology on the website and it's clear that this is aimed at building a high-volume payments network. "Tempo was started by Stripe and Paradigm, with design input from Anthropic, Coupang, Deutsche Bank, DoorDash, Lead Bank, Mercury, Nubank, OpenAI, Revolut, Shopify, Standard Chartered, Visa, and more. It doesn't displace other general-purpose blockchains; rather, it incorporates design choices that meet the needs of high-volume payment use cases," says tempo.xyz. "These include predictable low fees in a dedicated payments lane, stablecoin neutrality, a built-in stablecoin exchange, high throughput, low latency, private transactions, payment memos compatible with standards like ISO 20022, compliance hooks, and more." Posting on Hacker News, Patrick Collison suggests that Tempo should be a platform like ACH or SWIFT that works in the background to orchestrate transactions. It's implied in the discussions that Facebook's Libra project (which finally floundered in 2019) might well have gotten off the ground had the Genius Act been in place back then. Collison writes that it's not correct to see stablecoins as regulatory arbitrage, as some suggest. "I think this usually indicates a lack of understanding of the challenges, complexities and costs associated with high-volume cross border money movement."

M-PESA users report that Safaricom is moving services in efforts to create a superapp which includes international payments. "This week, users began noticing that functions once exclusive to the mySafaricom app – such as airtime purchases and home internet management – appear inside the M-PESA super app," reports Techcabal. "The overlap looks minor, but the shift signals a deeper rethink of how Kenya's largest telecom operator wants subscribers to interact with its digital ecosystem. Launched in 2016, mySafaricom app was marketed as the all-purpose self-care app for anyone with a Safaricom line. Five years later, Safaricom introduced the M-PESA app, which the company described as a financial tool for payments, savings, loans, and global transactions. The super app, by contrast, has evolved into a broader marketplace, hosting mini apps for ticket booking, shopping, insurance, and more. It also carries PayPal withdrawals and GlobalPay, a Visa-backed virtual card that lets customers pay international merchants like Netflix. M-PESA remains Safaricom's biggest growth driver. The platform now commands over 35 million active users in Kenya, with millions relying on the M-PESA app for daily transactions."

Revolut has made its first steps to opening an operation in the Gulf region after receiving approval in principle from UAE's central bank for a payments licence. "The approval pertains to Revolut's applications for Stored Value Facilities and Retail Payment Services (Category II) licenses, which were given the green light by the Central Bank of the UAE this week," reports Fintech Futures. "The licenses allow Revolut to store customer funds and provide digital payment solutions to retail customers in the UAE, clearing the path for an entry into what the London-headquartered digital bank describes as a 'key market'." The London-based digital bank started in the UK and Europe as a payments app.

American Express has proven its enduring value as spend among younger customers rises and it continues to grow it merchant network. Bloomberg reports that the venerable US business has grown its location numbers five-fold in the last eight years, with 160 million merchants now accepting its cards. It also illustrates the extent to which third-party players have grown more important. "Anna Marrs, the firm's group president for global merchant and network services, attributed the growth to some specific markets, including Japan and the UK, and to partnerships with payment facilitators such as Block Inc.'s Square, Adyen NV or Stripe Inc. 'It means that we're connecting more merchants with those premium, high-spending customers,' Marrs said in an interview." And while American Express cards are more expensive for merchants to accept, people with Amex cards tend to spend more, at a rate of 2.9 times the spend domestically and four times the spend overseas.