Australian banks have supplied enough scandal to keep a soap opera running for a decade, and the eagerly awaited Haynes report — described by Reuters as a "bombshell" — was released yesterday. Australian banks said "sorry, we definitely won't do it again", and investors celebrated by pushing bank share prices up five percent. "Citi said the Royal Commission inquiry, which was chaired by former senior judge Kenneth Hayne, recommended relatively few changes to the law, no meaningful structural changes to the industry and no radical changes to the regulatory model for banks," writes the FT. Citi's banks analyst Brendan Sproules, said: "We are surprised that Commissioner Hayne has had enough confidence in these structures to deliver better customer outcomes in the future than what was presented in evidence."
The US Consumer Financial Protection Bureau is down but not out. Under Mick Mulvaney, the US agency has moved to a more pro-business stance. The CFPB's latest Request for Information is for the consumer credit card market. In particular, the CFPB is seeking comment on the effectiveness of disclosures on fees. It also seeks comment on unfair practices, and the impact of regulation on innovation in the industry. While US consumer credit card debt may be at a record high, the CFPB's focus is not just on the money. A focus on disclosure in the small print echoes recent reports from the UK, where a recent report from East Anglia University found that language on credit card deals on websites is the hardest consumer financial information to understand.
Yesterday we reported on a New York Times story suggesting that Google picks up 14,000 pieces of data a day from the phones of some users. How will that play in highly security-driven states such as Israel? Google is planning to launch its Google Pay digital wallet with the promise that it can easily cross the borders between online and offline commerce. So, Google will be looking to add itself as a layer in the payments process. "The giant U.S. company has been undertaking a round of meetings with regulators, bank executives, credit card companies and financial-technology startups. The campaign, which involves a team from Google Israel, includes playing a role in Israel's rapidly growing e-commerce sector as well as in brick-and-mortar retail," reports Haaretz. Recent legislative changes mean that the Israeli banks have been forced to sell off their credit card divisions. "As a result, a battle is underway between the bank and the soon-to-be-spun-off credit card companies over who will dominate the market. The fight is expected to be especially intense for lining up small businesses, the kinds the credit card companies have traditionally ignored."
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