Check out the latest “Citadel Advantage News Digest - Issue #111” - 19 May

Read the latest “Citadel Advantage News Digest - Issue #111” - 19 May 2020 edition

#Cryptocrash grabs the attention of Treasury, other regulators" plus NEWS about Money, Payments, Business, Banking, Fintech and more

Read it HERE.

Does safe DeFi require CBDCs?

A BIS conference, streamed live on 4 April 2022, aimed at establishing a common understanding on how DeFi-based markets might evolve from their current state, what role central banks might have, and the potential interaction with Central Bank Digital Currencies.

How to design Buy Now Pay Later

What to get right when designing BNPL. Five design principles to keep in mind, surfacing relevant examples from Pulse while providing their very own design solution.

How Covid Changed the Payments Industry

Covid-19 caused clear shifts in payments preferences, changes that continue to reverberate through both banking and the world of nonbank payments providers. The most recent Federal Reserve Payments Study, delving deeply into data from 2019 and 2020, shows clear evidence that the pandemic jump-started migration from traditional forms of payments to a myriad of remote and innovative forms of payments.

Want to find out more? Click HERE.

Crypto Cards - a New Payments Disruption?

Account openings of crypto-backed cards are outpacing traditional cards. Using Visa and Mastercard as the rails, several crypto platforms now enable consumers to make everyday purchases with cryptocurrency. Analysts say it's a crucial step to making crypto a mainstream form of payment.

Is this the start of a new payment disruption?

Read the full details from The Financial Brand HERE.

What is the biggest challenge for traditional banks? - Decoding: Banks - Episode 9

From 11:FS. Banks are facing a lot of challenges compared to their fintech rivals. From issues of organisational structure to culture, it's a race against time to adapt and survive.

Swift Sanctions on Russia: How Cutting Off Banks Applies Pressure

A powerful coalition of democracies have announced that they will cut off some Russian banks from the global payment system Swift.

Here’s how Swift works, and how the move could ramp up pressure on Russian President Putin.

Will Banks Mint Their Own Stablecoins?

The USDF Consortium has set out to build a system for bank-minted stablecoins that would blend the attractions of digital currency, blockchain administration and faster payments. In time this could improve payments and other experiences for both companies and consumers.

To date, many of the uses for stablecoins — digital currencies denominated and tied to fiat currencies, such as the U.S. dollar — have been to facilitate other digital currency transactions. But the banking industry has fresh designs on the stablecoin. Beyond business payments, early intentions are to use the technology for consumer payments, as well. Also envisioned are financial marketplaces and crypto and securities lending.

Want to find out more? Check out the details form THE FINANCIAL BRAND HERE. 

How does lending work? - Decoding: Banks - Episode 4

From 11:FS. Lending has been around for thousands of years and is one of the cornerstones of banking. Although ledgers aren't made out of clay anymore, the principles have largely stayed the same. Curious to know more about lending? We get into how it works and what's in it for the banks.

How do card networks operate? - Decoding: Banks - Episode 3

From 11:FS. Mastercard and Visa are the two biggest credit card networks in the world. But what is a card network? How did they begin? How do they operate?

What are payments rails? - Decoding: Banks - Episode 2

From 11:FS. Ever wanted to know what’s going on behind the scenes every time we make a payment? We break down what a payments rail actually is, the different types, and why achieving real time payments is so difficult.

Customers Demanding Enhanced Mobile Banking Apps

It is more important than ever to deliver a significantly better digital banking experience than is delivered today. Customers want an experience that is fast, easy and secure. More importantly, they want control of their finances at their fingertips.

Find out more from The Financial Brand. Click HERE.

The Fed's CBDC report

The Federal Reserve isn’t in a rush to join the crypto-bandwagon. That's the takeaway from a draft paper the Fed released Thursday laying out the pros and cons of a Central Bank Digital Currency (CBDC).

The 40-page report makes no policy recommendations and is designed to solicit comments from the public.

"We look forward to engaging with the public, elected representatives, and a broad range of stakeholders as we examine the positives and negatives of a central bank digital currency in the United States," Federal Reserve Chair Jerome Powell said in a press release last Wednesday.

Read the full article HERE.

UK Lords Committee says no case for CBDC

A Committee of peers in the House of Lords has concluded that there is no convincing case for the creation of a central bank digital currency in the UK.

The Economic Affairs Committee found that while a CBDC may provide some advantages, it could present significant challenges for financial stability and the protection of privacy.

Read the full story HERE. 

How Starbucks Operates Like a Bank While Serving Coffee - WSJ

Starbucks, a $124.4 billion company, trails only McDonald’s as the largest restaurant chain by market capitalization. In this video, WSJ’s Heather Haddon explains how Starbucks used technology to garner its loyal customer base and why mobile orders are shifting the chain’s business priorities.

CBDC Digital Yuan Deployment To Massively Impact Cross-Border Policy Regulators' Decisions

The People's Bank of China (PBOC) has been a global front-runner in its creation of a central bank digital currency (CBDC) through the digital yuan's inception.

Also known as the e-CNY, the PBOC recently released the pilot version of its e-CNY app in China's Apple and Android app stores. The release of this app to selected users is particularly interesting given the app's current "research and development pilot phase", as indicated in a notice displayed when the app is downloaded. 

Nevertheless, the timing of this app release gives the world excellent insight into China's e-CNY ambitions, particularly with the 2022 Winter Olympics and the Chinese New Year holiday around the corner. 

Want to find out more? Click HERE. 

Is ‘Buy Now, Pay Later’ the Future of Consumer Lending?

Major specialists like Klarna, Afterpay and Affirm, as well as payments giant PayPal, are raking in big bucks financing consumer purchases. They are playing a different game than many banks and credit unions. But amid this tectonic shift there may be opportunity for traditional institutions — in part by picking up the pieces.

That buy now, pay later purchasing is booming is indisputable. It’s a story that’s been building up over the course of the last several years. Predictions that it would surge to new heights during the 2021 holiday shopping season were supported when PayPal CEO Dan Schulman, appearing on CNBC, crowed that on Black Friday, “our volume on buy now, pay later was up almost 400% year over year.”

Schulman added that his company’s “Pay in Four” installment plans proved to be “one of the stars, actually, of the holiday season for us.”

Want to find out more? Click HERE.

 

Santander finds itself in a Citi moment with $175 million error

As Santander looks to claw back roughly $175 million it mistakenly paid to British customers on Christmas Day, it can look to Citi, on a basic level, for what to expect, what to avoid and what to ask itself.

Citi’s manual transfer of $900 million in August 2020 to creditors of the cosmetics firm Revlon is likely the highest-profile recent case of a bank making an errant, nine-figure payout from its own reserves.

For Santander, the $175 million represents duplicate payments. About 75,000 people and companies received one-off or scheduled payments from 2,000 businesses — in many cases, their employers or suppliers — that have accounts with the bank. Then, they received a second identical payment from Santander.

Find out more HERE.

What Does a 'Layer 2 Blockchain' Mean?

Since Satoshi Nakamoto released the Bitcoin whitepaper in 2008, blockchains have continued to gain popularity.

People have applied blockchain technology to other areas, besides payments, thanks to its decentralised and secure nature.

Scalability is what Ethereum founder, Vitalik Buterin, calls a component of the "blockchain trilemma."

Buterin's thesis explains that no blockchain network can equally provide decentralisation, security, and scalability. They must sacrifice certain elements to achieve near-optimal functionality.

Bitcoin and Ethereum trade off scalability for security and decentralisation for scalability. That explains why a major blockchain network like Bitcoin can process around 7 transactions per second. For context, Visa's payments system can process up to 24,000 transactions per second.

If blockchain technology must attract more users, it must solve the scalability problem. Several solutions have appeared in recent years, including the now-popular “layer 2” protocols.

Click HERE to find out what layer 2 blockchain means, how it works, and why it’s important for blockchain adoption.

Is 'Buy Now, Pay Later' the Future of Consumer Lending?

Some view soaring BNPL as an existential threat to credit cards and traditional bank loans. Others argue there are strong opportunities.

Read the full article HERE