BLACKBERRYS AND IPHONES are becoming the centre of attention as numerous companies are launching solutions that allow these phones to be used as card acceptance devices. If anyone who owns a smartphone can potentially become a merchant, and bypass many of the set-up costs of accepting cards, the traditional business models of merchant acquirers and terminal manufacturers could face a dramatic shake-up.
Letter from the editor
American Express is not just for the big things in life, or so the new ad campaign states. Beyond dining at the Ritz and the first-class ticket to Tokyo, American Express is also proving to be useful for bypassing interchange regulation. Australia is a bellwether for interchange regulation worldwide, and the gains made by the card network in that market are impressive. However, the irony is that the more successful the network becomes, the less likely it is to remain outside the regulator’s sphere of interest.
Hong Kong issuers focus on rewards
Rewards programmes have become a key feature of Hong Kong’s credit card market as issuers have been forced to find ways to spur spending and innovate in a market that – like many other around the world – has been affected by an economic slump. The market’s unpleasant experience in the last decade meant banks were much better prepared for the downturn that followed the credit crisis.
A grand scheme
The Euro Alliance of Payment Schemes (EAPS) is a pan-European debit card ‘scheme of schemes’ that aims to be an alternative to Visa and MasterCard in Europe – like the Monnet and PayFair initiatives. Ugo Bechis, chairman of the EAPS board and head of SEPA payments at UBI Banca, speaks to Ronan McCaughey about the business case for EAPS and how it can benefit stakeholders in the payments process.
Realising South Africa’s potential
South Africa’s credit cards sector has experienced a rollercoaster ride in recent years. Market penetration surged for the five years until 2007, only to fall since 2008 due to the economic downturn and regulatory intervention. However, figures for 2009 and 2010 are expected to show some recovery as the market retains significant potential, particularly among the emerging middle-class population and the unbanked sector
Broadening the appeal of prepaid
Prepaid cards offer banks in Europe a significant opportunity to capture new revenue streams and are unlikely to cannibalise financial institutions’ existing credit or debit card portfolios, according to new market research.
Databank
Global credit card profitability
Issue: 2010/01 Date: 22 Jan 2010
Frosty forecast for Iceland’s banks
DOUBT REMAINS ABOUT Iceland’s recovery, and the row over who should compensate the UK and Dutch depositors in Icesave – the online savings arm of Landsbanki that collapsed in October 2008 – is threatening to spill over into a diplomatic row that may damage the reputation and potential comeback of Iceland’s retail banks.
Letter from the editor
‘Beyond normal thinking.’ In the cold light of hindsight, it looks a cruel tagline. The slogan was crafted by Icelandic ex-bank Kaupthing during the heady days pre-credit crisis, and was used to describe the concept of ‘Kaupthinking’. Given the swift and dastardly fate that befell Kaupthing (see 'Frosty forecast for Iceland's banks') – which boasted of doubling in size every year for eight years and growing its balance sheet by 500 percent in the mid-2000s – it raises questions about innovation in financial services and what that ‘thinking’ comes up with. Former Federal Reserve chairman Paul Volcker has already given his views on that subject, and they are not kind to the banking industry.
Africa ready for quantum leap
Retail banks in Africa have emerged from the financial crisis relatively unscathed, although a credit shortage indicates signs of contagion. The market is likely to consolidate as major players expand beyond their home borders. Mobile financial services will also have a transformational effect – enabling enlightened players to leapfrog their competitors. Ronan McCaughey reports.
A common thread
After recently reporting Q4 2009 results, Citi remains under strain but has a renewed strategy and structure that it hopes will represent a brighter future for the world’s first global consumer finance organisation. Sergio Zanatti, executive vice president in Citibank Korea’s Cards Business Group, talks to Jane Cooper about leveraging the bank’s global presence to be successful in local markets.
Down, but not out for the count
Coordinated international action averted a systemic crisis in Central and Eastern Europe (CEE) in 2009 – paving the way for the region’s retail banking industry to enter a new phase in the cycle towards recovery. Significant challenges remain in the short term, but demographic segments such as the region’s mass-affluent market highlight the opportunities to be tapped. Ronan McCaughey reports.
To hire or to fire, that is the question
Plans for human resources (HR) management have been revised for the New Year as banks are adapting to changing conditions by either making plans to become leaner or by beefing up their workforce.
Databank
Consumer finance outlook 2010
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