The Federal Reserve plans to launch a real-time payments system within the next five years; Robinhood received approval from the U.K. FCA to operate as a broker in the country; Walmart is seeking a patent for a digital currency that customers could use within the retailer’s ecosystem; Apple updated its website ahead of the launch of Apple Card; Swedish payments firm Klarna raised $460M, making it the most valuable European fintech; and the FT discusses India’s importance as a battleground for digital payments market share between American and Chinese competitors.
In the News
Fed to offer real-time payments by 2024. The Federal Reserve said it will create a real-time payments (RTP) system, FedNow, which will go live by 2023 or 2024. The Fed said its service will help modernize America’s payments infrastructure and provide “consumers and businesses more flexibility in managing money and making time-sensitive payments.” Fed chairs voted 4-1 to proceed with the plan.
Warren seeks answers from Capital One. Senator Elizabeth Warren (D-MA) sent a letter to CEO Richard Fairbank [full text], asking for details about the recent security breach that exposed over 100 million consumers’ personal information. In addition to seeking a timeline of the breach and details about Capital One’s security, Warren inquired about plans to inform and protect affected consumers.
Robinhood authorized to operate in U.K. The San Francisco-based, commission-free stock trading app received approval from Britain’s Financial Conduct Authority (FCA) to operate as a broker in the U.K. The FCA approval comes only one week after London-based fintech Revolut announced its own plans to launch a commission-free stock trading service across Europe.
Walmart is seeking a digital currency patent. The retailer filed an application with the U.S. Patent and Trademark Office for a cryptocurrency aimed at “payment issues and inefficiencies within its stores . . . allowing Walmart customers to exchange cash for a Walmart ‘coin.’” Details remain scarce, but the project appears more narrow and less likely to arouse regulatory scrutiny than Facebook’s Libra efforts.
Apple prepares to launch Apple Card. The tech giant rolled out a new page on its website dedicated to the new credit card, which it has developed with Goldman Sachs. U.S. Apple users will be able to apply for the card using Apple’s Wallet app, allowing approved consumers near-instant use in stores, apps, and online. Apple Card will offer cash-back rewards and extra savings for Apple purchases.
Monzo suggests 500k users change passwords after discovering bug. The British challenger bank asked nearly 500,000 customers to change their passwords after discovering a bug that made their PINs accessible to company engineers. “No one outside Monzo had access to these PINs,” said a bank spokesperson, but “just in case, we’ve messaged everyone that’s been affected.”
Klarna raises $460M at $5.5B valuation. The Swedish payments firm raised $460 million in new funding, valuing it at $5.5 billion and making it the most valuable private fintech firm in Europe. Klarna allows consumers to make purchases through interest-free installments at point-of-sale, an alternative to credit cards adopted by many customers. Klarna is now expanding its presence in the U.S. market.
Fox buys controlling stake in Credible for $265M. The Fox Corporation purchased 67% of San Francisco-based Credible Labs for $265 million, giving the media conglomerate control of the firm. Credible, which offers credit checks to borrowers seeking mortgages, student, and personal loans, “underscores Fox’s innovative digital strategy that emphasizes direct interactions with our consumers.”
FT: U.S. and China compete in India’s digital payments boom. The Financial Times explores how India has become a key digital payments battleground between American and Chinese investors. The article highlights two reasons for India’s strategic importance: India has around 450 million mobile internet users, and both the U.S. and China have largely denied companies from entering each other’s markets.