Step by step this cynical blogger is becoming a convert.  Raising $10M is a big deal.  It seems the model is to provide a quality front end with a bank and FDIC guarantees behind. I remember back in the 90’s when internet was new and one of the models we conjectured was banks becoming ‘manufacturers’ sitting the in the background offerring banking services wholesale.  Part of that model requires Banks to buy in. BankSimple have absorbed that model it seems and found willing providers.  key will be the financial arrangement between the players.  It is easy to take on the … Continue reading BankSimple raises $10 million and offers hope for banking innovation

This is a must read for anyone interested in banks and banking. The coming world of smaller banks | Frank Partnoy – ft.com How many people does it take to operate a modern bank and how much should such a bank’s shares be worth? With that simple question Frank kicks of the article by reciting the seemingly dramatic reductions in banking staff.  Yet he points out the markets reacted by driving down stock prices of banks.  Then comes the killer point (emphasis mine) Bank analysts cite several reasons for share price declines, including litigation exposure, declining investor and consumer confidence … Continue reading After the 2008 tipping point, banks need genuine breakout strategies, not incremental improvement

About time is all I can say about this.  The country that sticks to miles and mag stripes truly needs to get with the programme and I hope Visa are serious about forcing this through.  MasterCard should be all over this too. Visa cites m-payments as it pushes US to EMV | Finextra Now card giant Visa has set out its programme to drive the adoption of dual-interface chip technology to "help prepare the US payment infrastructure for the arrival of NFC-based mobile payments" as well as improve security and international interoperability. Continue reading Visa plots to enforce chip cards in US

This from June 17th, 2011 based on an IMF report indicating political risk in the US,  seemed to many as an irrelevant comment at the time.  No more, and note the reference to political risk in the S&P report.  All the talk of the $2 trillion mistake is missing the point.  Even after the mistake is adjusted, the fact of American arrogance and political ineptitude between the three branches of government (Congress, Senate, President) adds up to political risk when viewed from outside America. Continue reading America has a political risk issue to resolve

Alex at mybanktracker.com has a review of the current trend to eliminate bank debit rewards, following changes in interchange rules.  He has identified which banks are involved along with the article describing the background. The Future of debit rewards Continue reading MyBankTracker.com Review: The Future of Debit Rewards

This article is a good example of buzzwords getting ahead of common sense, at least as much as we can discern from the articles.  Apologies for picking on Westpac but none to Microsoft or IBM. Westpac to save from its own private cloud AustralianIT Next month, Westpac will begin migrating about 40,000 mailboxes to the single Outlook platform from IBM Lotus Notes and Novell GroupWise used across the group. Full implementation is expected to take between 12 and 15 months. With the private cloud, Microsoft applications will be hosted at Fujitsu’s local data centre and accessed by Westpac staff. So … Continue reading Westpac announcements sound like they are driven by vendor PR

With only a few days left the people who manage money, banks and traders are essentially warning of a September 2008 scenario. Fed under fire over default talks They want to address contingency planning for a run on money market funds that hold Treasury bonds, the impact on capital and liquidity ratios if there are large inflows or outflows of deposits and the potential effect on short-term financing from any problems in the repurchase, or “repo”, market. Continue reading Serious fear enters the markets, only 3 years later – July 28th 2011

Brett King has a three part series of blog posts on Finextra that provide a good backdrop to state of startups in financial services. I commented today with this, and wanted to expand on it after about the notion of disrupting banks. I would take issue though that we are perhaps not yet seeing the ‘disruption of banking’.  As both a long time observer and market participant (disclosure – I am involved with CommunityLend in Canada) I see these startups carving a useful niche, sometimes profitable, sometimes not.  These niches are small and particular.  I believe Giles (quoted – from … Continue reading What will it take to disrupt banks?

The General Accounting Office (GAO) in the US as requested by the The Dodd-Frank Wall Street Reform and Consumer Protection Act directed GAO to conduct a study of person-to person lending. Their report is now released at http://www.gao.gov/products/GAO-11-613 It provides a comprehensive look at how Lending Club and Prosper work, the challenges P2P Lending presents to the regulators who are based on pre-internet business models. This report addresses (1) how the major person-to-person lending platforms operate and how lenders and borrowers use them; (2) the key benefits and risks to borrowers and lenders and the current system for overseeing these … Continue reading US GAO report – “Person-to-Person Lending – New Regulatory Challenges Could Emerge as the Industry Grows”

A headline that is eerily reminiscent of September 2008 when markets dried up overnight following the bankruptcy of Lehman Brothers. Collateral demand rises for interbank lending By contrast, lending between banks without the backing of collateral has ground to a near standstill for any loans of more than a week’s duration, as fears of bank insolvency rise due to continuing uncertainty over Greece and its emergency loan payments. The background here is that small euro banks are implicated in this for now.  The question will be what happens next and what other banks will be involved.  The changes since September … Continue reading Worlds banks are on edge as a result of Greek situation