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Home » Daily Briefing » Daily briefing - 27 June 2019

Daily briefing - 27 June 2019

The ECB's Yves Mersch has been calling for instant payments in Europe for the last few years, but he's also been warning that bitcoin is a ponzi scheme, so he's not really credible. Still, someone's gotta do it But Libra has lit a rocket under central bankers, who don't have the common interests commonly supposed. Because Europe's instant payments system, reputedly on track for 2020, is being put together in typical form, bodging together several clearing houses. Now, it turns out that what Europe "needs" is the same thing that the rest of the world needs. "'The challenge now is to make these mechanisms interoperable,' said Piet Mallekoote, the CEO of the Dutch Payment Association," Reuters reports. "The Netherlands has already made instant payments available to all bank customers in the country via a project backed by seven major domestic banks, including ING and ABN AMRO. But even if a payments system is rolled out across the euro zone this may not be enough to attract customers away from fintech providers with easy to use apps.

A couple of decades after the UK's big banks made a disastrous push into the US, the UK's plucky new batch of digital banks are, yes, plotting expansion into the US. Monzo chief executive Tom Blomfield said the company's "per-user contribution" had moved from a loss of £30 per year to £2 earlier this year and has subsequently reached £5 per customer. "Despite edging closer to sustainability, however, net losses increased 54 per cent to £47.2m. The increase was driven largely by a near-tripling in personnel costs, as the company increased headcount from 300 to 713. Mr Blomfield said losses were likely to rise further this year thanks to a £20m marketing drive, but described the increase as a 'strategic choice'. Earlier this week Monzo announced a £113m investment that valued it at just over £2bn, and Mr Blomfield said 'we're pretty comfortable we're well capitalised for the next few years.'"

As Europeans prepare for full PSD2 adoption in September, a poll by Go Cardless looked to find out the concerns of online shoppers. It turns out shoppers are quite fond of good security. Strong Customer Authentication, which will generally require a two-factor authentication for online purchases, adds some friction to the shopping process by requiring customers to use a texted code for instance. Stripe co-founders and others have been warning that this will slow down the online process and add unnecessary complexity. "The report surveyed 4,000 customers across the UK, France, Germany and Spain about their attitudes to both security and convenience when shopping online," writes Alex Rolfe. "It also asked questions on feelings about certain specific elements of the new SCA requirements, and how increased security at checkout would influence their buying behaviour. Across all four countries surveyed, security was deemed more important than convenience, but in some markets, the difference was small. The attitudes towards security and convenience were most evenly split in the UK, with 55% choosing security, while France had the greatest preference for security (62%)."

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