Mastercard_2016logo_400px F468
Free
By their logos shall ye know them

MasterCard's rebrand, unveiled earlier this summer, reveals a deeper strategy, embodying a recognition that relying on the traditional rails can only take it so far into the new realms of mobile. Last year, to tweets of dismay from traditionalists, Google underwent an intriguing brand redesign. The smaller, scaleable images used to power the new look reflected the increasing number of users in developing countries (for whom bandwidth can be expensive or patchy) and the shift worldwide from PC platforms to mobile. Now it is MasterCard's turn — and the rebranding, though subtle, is at least as telling as Google's. The global cards scheme is modifying the styling of its name: rendered typographically, this revamp of the wordmark amounts to the term "MasterCard" moving to lower case. In running text, the company still capitalises the first letter of its own name and thus now refers to itself on its US website as "Mastercard" rather than "MasterCard". That striking of the upper case C in MasterCard is revealing indeed. Certainly the dropped capital letter represents a corresponding shift in emphasis from the particular oblong of stiff plastic which, until the world wide web came along, was intertwined with the offerings of the international schemes. But there's more, as pointed out by Celent's Zilvinas Bareisis, the ceremonial downgrade of "Card" to "card" also signals that the network is diversifying away from the card rails that were, hitherto, existentially foundational. It is, in the words of Bareisis, "an important step in the company's journey from a cards network to a payments network". Both MasterCard and Visa refer to themselves on their websites as a "payments technology company". PayPal, incidentally, calls itself a "payments platform". Rails and riders Turning back to MasterCard, an even bigger step beyond its traditional field of operations is this summer's purchase of VocaLink: with the advent of the Faster Payments Service and the Zapp payments app (still in the works after several years gestation but set to offer British consumers the chance to pay at the POS by directly accessing their current accounts), disintermediation had been a growing concern for the schemes. Now MasterCard will be able to straddle both sets of rails and bake customer-enticing rewards into each. Visa and MasterCard have significant challenges but seem to be rising to the occasion on several fronts: collaboration with the likes of VocaLink is wise as it takes MasterCard into new territory. Alongside this, opening up the traditional rails to outside developers will also be decisive: consider Visa Europe Collab, partnering across the new digital and fintech ecosystem, and MasterCard's own Innovation Labs. In the United Kingdom, MasterCard dominates the credit cards market but lags far behind Visa when it comes to debit cards: might the Vocalink acquisition be a way to leapfrog rivals Visa, through offering an even easier way for consumers to pay instantly from their bank account? The stakes are growing fast, in this, Europe's biggest market for payment cards. And might there even come a time when the word "card" is no longer part of the company's name? Such a move, once unthinkable, may be in the offing. In 2007, "Apple Computers" became "Apple", for reasons that now seem obvious in retrospect.

anders_bouvin_3
Free
Out with the new, in with the old as Handelsbanken reasserts its values

Handelsbanken has reasserted its branch-based values after ousting a CEO who had just 18 months in the role and replacing him with the man who successfully championed its decentralised decision-making philosophy as head of its UK operations. The Swedish bank removed 48-year-old CEO Frank Vang-Jensen in favour of 58-year-old Anders Bouvin just three months after the bank had signalled that its goals under the former would see up to 60 branches being closed over a two-year period. In sharp contrast to many of its competitors, Handelsbanken, which received a four-star rating in Lafferty Bank Quality Ratings, has long championed a branch-based approach despite the wider digital transformation of banking. It is also thought that Vang-Jensen's approach favoured controlling Handelsbanken branches from headquarters in Stockholm rather than allowing branch managers a significant degree of autonomy. During the upheaval, Handelsbanken also revealed that Andrew Copsey has been appointed acting CEO of Handelsbanken UK. He was previously head of administration for Handelsbanken UK. In appointing Anders Bouvin as the new president and group chief executive with immediate effect, Pär Boman, chairman of the board of Handelsbanken and Vang-Jensen's predecessor as chief executive, said the board's decision had been unanimous. "This decision is purely related to the individual. Handelsbanken remains strong and our long-term goals stand firm," he said. "All managers at Handelsbanken — particularly the branch managers — must have a very high degree of autonomy. Being the most senior manager at the bank therefore requires a special type of leadership — considerably more complex than traditional management. Thus, it is possible to be an excellent leader and manager — as Frank Vang-Jensen has been — but not fulfil the requirements of CEO of Handelsbanken," he added. "Anders Bouvin has worked at Handelsbanken for more than 30 years and is totally familiar with the Bank's working methods, culture and values. For the past ten years, he has worked at Handelsbanken in the UK, where he has built up a national branch network with stable finances, good profitability — and by far the most satisfied customers in the market." In another bank, changing CEOs twice in 18 months might be seen as a sign of instability, or lack of direction, but Handelsbanken is portraying this change as the opposite: recognising and rectifying a mistake in order to resume its well-defined business model. Given the bank's track record, who is to argue?

Katharina Luth
Free
Raisin looks to stir cross-border savings and investments competition

In this era of low interest rates, Berlin-based fintech start-up Raisin (previously known as SavingsGlobal), aims to simplify the process of shopping for higher interest rates on savings and encourage cross-border competition by giving customers access to savings products across the entire European Union and European economic area via a single platform. Interest rates vary widely across Europe and even within individual countries. "If you take the average of the three largest banks in Germany, they pay something like 0.04 or 0.05 percent on a one-year term deposit, whereas even in Germany alone you can still get up to 1.2 percent. And then when you look across borders, situations are even more different", Katharina Lüth, head of Europe for Raisin, told Lafferty News. But with Raisin, "you get access to banks that are still willing to pay higher interest rates, all the while your deposits being guaranteed by the respective national deposit guarantee schemes of the countries where the banks are located". The savings platform offers interest rates of up to 2.2 percent from some of its 19 partner banks, according to an April press release. EU regulations require countries to guarantee deposits of up to €100,000 ($111,670), which is the maximum amount that Raisin permits customers to place per bank — ensuring that deposits are 100 percent secured. Ease of use for customers is a key factor for the platform. Although customers do need to provide Raisin with a reference bank account when signing up, there are no set-up fees for users. As a fully online service, customers can sign up remotely with no need for face-to-face interaction. Ms Lüth said Raisin was inspired by CEO Tamaz Georgadze's experience of retail banking in the country of Georgia, where he is from. "We saw that for a euro term deposit you can actually, or could at that point, still get double digit interest rates on euro-denominated savings accounts and a lot of people started asking, 'Hey how do I open a bank account in another country in order to get higher interest rates?'" she explained. The original intent of Raisin was to provide those higher interest rates for customers on a global scale, but Ms Lüth admits that "from a regulatory perspective, that's rather complex". Raisin debuted successfully in 2013 in Germany under the name WeltSparen, and gained 35,000 customers with €1 billion worth of deposits over the course of two years. The company's model evolved over time, and it began its internationalisation efforts in April with the launch of an English-language pan-European marketplace for savings. Raisin also launched its French platform, raisin.fr, in May. A crucial next step for the platform is to provide a fully local language customer service website and documents, Ms Lüth said. Additionally, Raisin wants to allow banks to move deposits to the company's partner banks — "We do see that there are a lot of banks out there that actually have a lot of funding that they don't need and they have to pay money when they store it at the ECB". "Colloquially speaking", she says, "We have the vision of becoming the 'Amazon of savings and simple investment products in Europe', so we are looking at what other simple, fair, low-cost savings and investment solutions are of interest to our clients."

FEATURED ARTICLES

Morning Briefing
Friday 26th August @ 9:06am

CTBC Financial Holdings, the parent of Taiwan's leading credit card issuer, and Chinese state-backed bank China CITIC Bank Corp have cancelled investments in each other amid concerns that they would not get regulatory approval against a backdrop of political tension between China and Taiwan, according to a Reuters report. "This was mainly due to financial regulatory policies in the two......MORE

Mastercard_2016logo_400px F468
Thursday 18th August @ 3:33pm

MasterCard's rebrand, unveiled earlier this summer, reveals a deeper strategy, embodying a recognition that relying on the traditional rails can only take it so far into the new realms of mobile. Last year, to tweets of dismay from traditionalists, Google underwent an intriguing brand redesign. The smaller, scaleable images used to power the new look reflected the increasing number of users in developing countries (for whom bandwidth can be expensive or patchy) and the shift worldwide......MORE

RBA New Logo
Thursday 18th August @ 3:24pm

Each month, Lafferty News presents a Knowledge File from the Retail Banking Academy's Cards and Payments course books. This month's Knowledge File is taken from the Cards and Payments I course book. Data, Analytics, and Decisions: The Holy Trinity of Success in Card Marketing Effective use of Analytics in Marketing: Business intelligence and analytics are the engines of marketing that run on the fuel of rich data. Business intelligence is like driving a car with......MORE

Thursday 18th August @ 3:23pm

Banks and issuers in Lebanon have responded to the challenges posed by a growing population and a period of political adversity by focusing their efforts, growing the number of POS terminals and introducing attractive incentives for using them, according to the latest Lafferty research. The number of POS terminals increased by 53 percent between 2009 and 2015. Issuers also successfully identified cohorts of the population that were underserved, such as women and university students, and......MORE

Thursday 18th August @ 3:20pm

Despite the proliferation of developments in new payment methods, SMEs in the UK are still losing almost £8.8 billion in sales by not accepting debit and credit card payments, according to new research from Barclaycard. This represents an 18 percent increase on the situation two years previously, suggesting that consumers in Britain could be beginning to turn their backs on cash-only businesses. In this era of radical payments innovation, the research reveals that 49 percent of SMEs in......MORE

anders_bouvin_3
Wednesday 17th August @ 3:23pm

Handelsbanken has reasserted its branch-based values after ousting a CEO who had just 18 months in the role and replacing him with the man who successfully championed its decentralised decision-making philosophy as head of its UK operations. The Swedish bank removed 48-year-old CEO Frank Vang-Jensen in favour of 58-year-old Anders Bouvin just three months after the bank had signalled that its goals under the former would see up to 60 branches being closed over a two-year period......MORE

Katharina Luth
Wednesday 17th August @ 3:18pm

In this era of low interest rates, Berlin-based fintech start-up Raisin (previously known as SavingsGlobal), aims to simplify the process of shopping for higher interest rates on savings and encourage cross-border competition by giving customers access to savings products across the entire European Union and European economic area via a single platform. Interest rates vary widely across Europe and even within individual countries. "If you take the average of the three largest banks in......MORE

RBA New Logo
Wednesday 17th August @ 3:17pm

Each month, Lafferty News presents a Knowledge File from the Retail Banking Academy's course books. This month's Knowledge File is taken from the Retail Banking I course book. The literature has not provided a universally accepted single definition of Customer Relationship Management (CRM). There are nearly as many definitions of CRM as there are software vendors and system integrators who specialise in the industry. In fact, this lack of clear definition is shown by......MORE

CMA what happens next
Tuesday 9th August @ 10:58am

Banks in the UK will have to publish "trustworthy and objective" information on the quality of services that they provide to customers and ensure that new technology is fully exploited to their customers' benefit as a result of a series of measures being imposed by the Competition and Markets Authority (CMA). The CMA's final report on its retail banking market investigation concluded that many customers pay more than they should for bank services and do not benefit from new......MORE

Morning Briefing
Tuesday 9th August @ 9:11am

The Competition and Markets Authority (CMA) in the UK ushered in an era of open banking today, telling banks to introduce new digital services and to set their own limits on unarranged overdraft fees as part of the final report of the CMA's https://assets.publishing.service.gov.uk/media/57a8c0fb40f0b608a7000002/summary-of-final-report-retail-banking-investigation.pdf.11(retail banking market......MORE

Thursday 4th August @ 3:27pm

The global payments industry is moving at a frantic pace. The last two years have seen groundbreaking shifts and seismic evolutions on many fronts across the globe. In fact, a large portion of the fintech revolution comprises of disruptive launches by the payments industry. We have seen more disruptions in the payments industry in the last two years than at any time since the launch of the Diners Club credit card in 1950. While we have seen the traditional players like Visa and MasterCard......MORE

Ollie Whitehouse technical director at NCC Group
Thursday 4th August @ 3:15pm

Like many people these days, I often share old photos with former school friends through our WhatsApp group. We send shocking photos to each other of when we were in school, and then we all congratulate each other on having improved with age. But soon I'll probably be sending money through WhatsApp for the money I owe a friend for a restaurant bill. Payments are now entering the social media sharing economy. PayPal's mobile payment app Venmo has been letting friends share payments......MORE