In the late 90s, a University of Manchester lecturer informed his class that one day a single device would combine portable audio cassette players, cameras and mobile phones. He knew this because he was wise to the concept of ‘convergence’. Of course, it seemed like madness to us. We could not imagine that the brick whose graphics capabilities maxed out at ‘Snake’ would actually be capable of taking a photograph. And, frankly, what is the utility of taking a picture with my phone? And how would I fit a cassette into it?
These days we expect amazing leaps forward; unexpected developments that alter how we conduct our lives. One of the recurring themes through the evolution is convergence. Amazon was incorporated in 1994 and began selling books in July 1995. Over time, via acquisition and investment, Amazon invested in the technology to support online retail and used that backbone to expand into other sectors. It is an expert at consumer facing technology, generating substantial consumer satisfaction. These days we think nothing unusual in ordering a meal from Amazon whilst we settle down to watch its streamed television and film content. It is an incredible success story.
Amazon’s business expands beyond providing goods and services to its customers. Amazon Lending launched in 2011 and has advanced loans in excess of $3bn to small businesses in the UK, US and Japan who might otherwise have failed to secure credit from traditional lenders. Those merchants are suppliers to Amazon, and so the company benefits from hyperlocal merchants with expanding product lines, thereby increasing the breadth of Amazon’s offering as well as its geographic reach. Of course, the loans also generate interest.
Amazon presently offers two credit cards to its customers via JP Morgan Chase & Co. and Synchrony Bank, getting in on the credit card market despite not being licenced to issue them on its own. Nonetheless, Amazon recognises the value in direct consumer contact, even when it comes to monetary matters. In 2017, Amazon launched the Prime Reload product, which rewards customers for pre-funding their Amazon balance from their debit account. In so doing, Amazon is cutting out Visa and Mastercard from those transactions.
Amazon is not alone: Apple, Google, Facebook and Square have their own payment systems, allowing them to keep their customers, and their data, close. PayPal has partnered with retailers for instore cash deposits to enable those without bank accounts to shop online. John Lewis launched a personal loan service for amounts up to £25,000, sitting alongside its insurance, foreign currency exchange and international payment services.
None of this should come as a surprise. These are large companies, absolutely expert at providing what their customers want, seeking to exploit the regulators’ general intent that there should be increased competition and innovation in the finance sector. They also have the trust and confidence of the younger generations of Millennials and below, who have grown up with these brands whilst hearing of the perceived difficulties and greed of the established banks.
Yet despite their size, vaulting ambition and capabilities, it may be some time before we see such companies making serious inroads on the sector. At present, Amazon Lending’s figures pale in comparison to the $130bn provided to small banks by JPMorgan Chase in that same time period. There are significant hurdles – both cultural and regulatory – to be overcome.
At present such companies are not subject to anywhere near the levels of scrutiny and regulation that banks are subject to. They have no demands on the nature and adequacy of their assets. The appropriateness and qualifications of their executive is, other than perhaps those imposed on public companies, limited to the pressures of their investors. By comparison, the banking rules and regulations are prohibitive and fiendishly complex, devised by banks and their regulators over decades. The banks are experts in their field, accustomed to the levels of compliance and the complexity of the products. It is difficult to envisage non-banks, particularly technology companies, being prepared to dive into such costly waters, going head-to-head with established big beasts, for potentially marginal gains.
Yet the landscape may be changing. The US Office of the Comptroller of the Currency is pushing ahead with exploring a form of Special Purpose National Bank Charters for fintech companies. Additionally, Brian Knight, Director of the Program on Financial Regulation and Senior Research Fellow at the MercatusCenter at George Mason University, has advocated a form of non-depositary charters and a “sandbox” scheme similar to that operated by the Financial Conduct Authority. There is certainly a groundswell of opinion that the blurring of the lines between consumer and financial should not be dissuaded as the developments are likely to serve in the interests of the consumer. Subject, of course, to appropriate oversight.
At a time when Amazon has spent $13.7bn acquiring Whole Foods, gaining the physical footprint that the company has needed to sell more groceries, it would appear that it has other things on its agenda before pushing into banking. Just as well for the banks – once the acquisition was announced Wal-Mart’s share price fell by 7.1%, demonstrating the clout that companies such as Amazon possess. Nonetheless, the large, consumer-focused businesses with technology at their core are already engaging in providing financial services and it is not unreasonable to expect this to deepen, just as banks have recognised the threats and consequently heavily invested in fintech and refocusing on their clients. The convergence will surely continue – it is not such a leap to imagine a future where we order groceries, queue up streaming content and check in on our financial health via a dialogue with our virtual assistant. It is far more feasible now than it was to imagine sending a photograph of Shaun Goater shinning a goal at Maine Road using my mobile phone whilst streaming music at a higher bitrate than a CD was 20 years ago.
U.S. inauguration turns poet Amanda Gorman into best seller
WASHINGTON (Thomson Reuters Foundation) – The president’s poet woke up a superstar on Thursday, after a powerful reading at the U.S. inauguration catapulted 22-year-old Amanda Gorman to the top of Amazon’s best-seller list.
Hours after Gorman’s electric performance at the swearing-in of President Joe Biden and Vice President Kamala Harris, her two books – neither out yet – topped Amazon.com’s sales list.
“I AM ON THE FLOOR MY BOOKS ARE #1 & #2 ON AMAZON AFTER 1 DAY!” Gorman, a Los Angeles resident, wrote on Twitter.
Gorman’s debut poetry collection ‘The Hill We Climb’ won top spot in the online retail giant’s sale charts, closely followed by her upcoming ‘Change Sings: A Children’s Anthem’.
While poetry’s popularity is on the up, it remains a niche market and the overnight adulation clearly caught Gorman short.
“Thank you so much to everyone for supporting me and my words. As Yeats put it: ‘For words alone are certain good: Sing, then’.”
Gorman, the youngest poet in U.S. history to mark the transition of presidential power, offered a hopeful vision for a deeply divided country in Wednesday’s rendition.
“Being American is more than a pride we inherit. It’s the past we step into and how we repair it,” Gorman said on the steps of the U.S. Capitol two weeks after a mob laid siege and following a year of global protests for racial justice.
“We will not march back to what was. We move to what shall be, a country that is bruised, but whole. Benevolent, but bold. Fierce and free.”
The performance stirred instant acclaim, with praise from across the country and political spectrum, from the Republican-backing Lincoln Project to former President Barack Obama.
“Wasn’t @TheAmandaGorman’s poem just stunning? She’s promised to run for president in 2036 and I for one can’t wait,” tweeted former presidential candidate Hillary Clinton.
A graduate of Harvard University, Gorman says she overcame a speech impediment in her youth and became the first U.S. National Youth Poet Laureate in 2017.
She has now joined the ranks of august inaugural poets such as Robert Frost and Maya Angelou.
Her social media reach boomed, with her tens of thousands of followers ballooning into a Twitter fan base of a million-plus.
“I have never been prouder to see another young woman rise! Brava Brava, @TheAmandaGorman! Maya Angelou is cheering—and so am I,” tweeted TV host Oprah Winfrey.
Gorman’s books are both due out in September.
Third on Amazon’s best selling list was another picture book linked to politics and projecting hope: ‘Ambitious Girl’ by Vice-President Kamala Harris’ niece, Meena Harris.
(Reporting by Umberto Bacchi @UmbertoBacchi, Editing by Lyndsay Griffiths. Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers the lives of people around the world who struggle to live freely or fairly. Visit http://news.trust.org)
Why brands harnessing the power of digital are winning in this evolving business landscape
By Justin Pike, Founder and Chairman, MYPINPAD
Delivery of intuitive, secure, personalised, and frictionless user experiences has long been table stakes in digital commerce, well before the era of COVID-19. As businesses harness the revolutionary power of digital technologies, they have pursued large-scale change to adapt to evolving consumer preferences (some more successfully than others, but that’s a blog for another day). Digital transformation is a term we hear repeatedly, and it looks different for each organisation, but essentially, it’s about utilising technology and data to digitise, automate, innovate and improve processes and the customer experience across the entire business.
As I said, this was already well underway but then came 2020 and no industry escaped the disruption of the coronavirus outbreak, which has had an indelible impact on businesses performance, operations, and revenue. Regardless of whether the impact of COVID has been very positive or very challenging, it has forced organisations globally to re-evaluate and re-orient strategies to adapt.
As lockdowns and pandemic-related restrictions continue to change daily life, this raises the question of how we can balance a dramatic shift to digital and the benefits it brings, while ensuring business continuity and innovation both during and post-COVID, and protecting everyone against fraud?
Digital is an essential survival tool, and even more so in a COVID world
No one could have predicted the dramatic digital pivot that has taken place over this year. Indeed, within weeks of the COVID outbreak cash usage in the UK dropped by around 50%. Digital solutions including delivery applications, contactless payments, mobile commerce, online and mobile banking have become essential components of a touchless customer experience in the era of social distancing. It’s no longer just about an enhanced and superior customer experience, it’s also about health, safety and survival.
In store, businesses have benefited from contactless payments enabling faster throughput and reduced need for consumers to touch payment terminals (therefore requiring greater cleaning, which degrades the hardware much faster). Mastercard reported a 40% increase in contactless payments – including tap-to-pay and mobile pay – during the first quarter of the year as the global pandemic worsened. Digital has also become an essential sales channel for many B2C brands. Where brick and mortar stores have been required to close, digital commerce enables continuity of customer relationships and revenue. This channel also provides brands with rich customer data, which can be used to enhance and personalise the customer experience and typically results in greater levels of engagement and uplifts in revenue.
Industry forecasts estimate that worldwide spending on the technologies and services enabling digital transformation will reach GBP 1.8 trillion in 2023 – a clear indication that the process represents a long-term investment and a global commitment to digital-first strategy. The key point here is that digital brings significant benefits, and regardless of COVID, is here to stay.
The challenges that rapid digital transformation brings to businesses
Regardless of whether businesses are operating in developed or less-developed economies, these times of crisis have levelled the playing field in the sense that all businesses are facing similar issues. Access to products and supplies, maintaining customer relationships, accelerating sales for some and declining sales for others, health and hygiene are just a few of the unique challenges brought about by COVID.
Many businesses in physical environments have had to swiftly implement changes to significantly reduce safety risks for staff and customers, such as contactless payments, mobile ordering and delivery options. But with these changes come a host of other benefits of digitisation, such as faster transactions, and reduced human error at the point-of-sale.
The reliance on technology, however, can also expose organisations and consumers to certain vulnerabilities. In particular, the risks of fraud and cybercrime have dramatically increased since the onset of the pandemic as scammers have taken advantage of digital technologies to target both businesses and individuals.
As a McKinsey report illustrates, new levels of sophistication in the activities of fraudsters have placed more pressure on companies that have been previously slow to go digital, bringing “into sharp relief how vulnerable companies really are”, and damaging the financial health of small and large businesses. In fact, the Bottomline 2020 Business Payments Barometer reveals that only one in 10 small businesses across the UK report recovering more than 50% of losses due to fraud.
But take these stats with a grain of salt. While it is important to be aware of the risks and challenges this new business landscape brings, it’s equally as important to have a lens firmly across your own business, industry and audience, and to identify the changes you can make internally to mitigate risk as well as improve your customer experience. Where can you make some quick wins? Do you have the right skillsets internally to achieve what you need to achieve? What technology is out there that will enable your business goals? There are tech companies like MYPINPAD that are making huge strides in software development, which will transform businesses globally.
A digital world post-COVID
Almost a year in, the line between business success and failure remains fragile. However, an ongoing transition towards greater digitisation will be the difference between survival and the alternative.
There is a wide range of initiatives businesses can implement to weather this storm. If we look at the space MYPINPAD operates within, secure digital consumer authentication is crucial to the ongoing success and security of not only financial products but also identification and verification across a range of different industry verticals. Shifting the authentication of consumers securely onto mobile devices enables businesses to completely reshape their customer experiences. By bringing together a more seamless, frictionless customer experience, accessibility, privacy, security and access to consumer data, businesses are able to drive digital transformation across day-to-day activities.
Against this backdrop, software with stronger security standards continue to play an ever more vital role in supporting society, protecting consumers and businesses from the increase in risks that rapid digitisation brings. Already, merchants can deploy PIN on Mobile technology from companies like MYPINPAD, onto their smart devices to speed up the digitisation process many are now tackling.
Essentially, opening up universal payments and authentication methods that feel familiar, for both online and face-to-face transactions, will be key to opening up a world of possibilities when it comes to redefining how businesses engage with consumers.
Brexit responsible for food supply problems in Northern Ireland, Ireland says
LONDON (Reuters) – Food supply problems in Northern Ireland are due to Brexit because there are now a certain amount of checks on goods going between Britain and Northern Ireland, Irish Foreign Minister Simon Coveney said.
British ministers have sought to play down the disruption of Brexit in recent days.
“The supermarket shelves were full before Christmas and there are some issues now in terms of supply chains and so that’s clearly a Brexit issue,” Coveney told ITV.
The Northern Irish protocol means there are “a certain amount of checks on goods coming from GB into Northern Ireland and that involves some disruption,” he said.
(Reporting by Guy Faulconbridge; Editing by Tom Hogue)
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