PRESSURE IS MOUNTING on the US to shift to EMV chip and PIN technology in accordance with other markets around the world. As EMV defences are built in other countries, fraud – with its tendency to attack the most vulnerable point – is likely to be attracted to the US market, which still relies on the magnetic stripe.
Letter from the editor
It is ironic that while banks are being urged to capitalise on the growing usage of debit cards worldwide, increased regulation challenges current debit business models and threatens to increase the cost of debit programmes. With the threat of regulation ever present, it is little wonder that banks and networks are eagerly waiting to determine the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act that was signed into law by President Obama in July 2010. A provision in the final bill states that card issuers cannot limit the routing of debit transactions to a single network or multiple networks by the same owner.
Pioneering payments in Kenya
Formal consumer finance facilities in Kenya are at a nascent stage, although the country is more advanced than many other African countries. The Kenyan consumer finance market can be characterised by a large unbanked population, low bank branch penetration levels, the prevalence of micro-lenders, and the phenomenal success of the mobile payments system M-PESA – operated by telecoms company Safaricom. Ronan McCaughey reports.
E-Money gains traction
Yandex.Money provides consumers in Russia with an easy and safe option when paying for goods and services via the internet. Once consumers have registered on the Yandex.Money website, the next step is to add funds to their newly-created ‘E-Wallet’ accounts. Funds can be added using prepaid cards, ‘cash-in’ terminals and ATMs, as well as credit cards, debit cards or internet banking. Jane Zavalishina, CEO of Yandex.Money, speaks to Ronan McCaughey about the challenge of providing an E-Money service in an economy where cash is king
Finding the revolver trigger
The majority of cards in circulation in Italy are classified as deferred debit cards, while only 10 percent are revolving credit cards. A challenge for issuers in boosting their profitability is therefore to shift the proportion of revolving credit cards to a figure much higher than the current 10 percent level. Italy’s consumer finance market is also far from fully developed when compared with the rest of Western Europe, as is the penetration of financial products in general
Debit card profitability best practice
Scant evidence exists that banks are using the best practices developed in support of credit cards to drive debit growth and performance. The challenge for many banks is that they suffer from a siloed structure where different management teams have responsibility for the credit and debit businesses. Ronan McCaughey examines how banks can capitalise on the growth of debit card usage around the world and improve the profitability of their debit programmes
Databank
Western Europe credit card metrics
Issue: 2010/07 Date: 23 Jul 2010
Deep impact of US banking reform
THE JOURNEY OF the Dodd-Frank Wall Street Reform and Consumer Protection Act has been heralded as the most significant legislation to affect the US banking industry since the Great Depression of the 1930s. The new regulatory regime will certainly leave a lasting impact on the US retail banking industry, although much of the detail will be left to the regulators to finalise.
Letter from the editor
The pace of change in today’s global retail banking industry continues to accelerate and nowhere is this more evident than in the regulatory space, as can be seen by the sweeping reform package of the US financial system that was recently signed into law by President Obama.
The case for breaking up Barclays
Growing political and commercial pressure may lead Barclays to consider spinning off both its investment and corporate banking operations and the Barclays Wealth division into a new company, leaving the remaining business as a predominantly pan-European and pan-African retail bank. Lafferty Retail Banking Insider assesses why Barclays might be about to embark on this bold change of direction.
Major surgery for Spain’s savings banks
A regulatory overhaul designed to bolster Spain’s troubled savings banks, or cajas de ahorros, which opens the door to private ownership, has been reportedly hailed as the most important reform of Spain’s banking system by the country’s Prime Minister. The Spanish government’s approval of the reform package will help to make the governance of the cajas more transparent and professional as the sector restructures.
Building a banking powerhouse
Abu Dhabi Commercial Bank (ADCB) is focused on becoming a retail banking powerhouse in the United Arab Emirates (UAE). This target was boosted by its recent agreement to acquire The Royal Bank of Scotland’s (RBS) retail banking business in the UAE. Arup Mukhopadhyay, executive vice president and head of consumer banking at ADCB, speaks to Ronan McCaughey about the bank’s ambitions and the state of retail banking in the UAE.
Dealing with internal fraud
Fraud prevention in the global retail banking industry has typically been focused on preventing outsiders from stealing data, but now banks are facing up to a serious risk that is much closer to home: their employees. Jane Cooper examines the extent of this problem and ways that financial institutions can combat it
Finding a sustainable P2P model
Peer-to-peer (P2P) lending websites, which threaten the traditional intermediary role of retail banks, function as online ‘matchmaking’ sites between borrowers and lenders, and aim to offer better rates to consumers than they would otherwise find at mainstream financial institutions.
Databank
Benchmarking Europe G5 markets
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