There will be no Update next week in observance of Labor Day in the US. We’ll be back on Monday, September 9th. Best wishes for a great week ahead and an enjoyable holiday. – The Fintech Update team
The Facebook-backed Libra project is facing scrutiny from European antitrust regulators; German digital bank N26 launched in the U.S. market; Bank of England Governor Mark Carney suggested potentially replacing USD with crypto as the world’s reserve currency; Apple launched its Goldman-backed credit card to U.S. consumers; Mastercard experienced a data breach affecting mostly German customers; and credit and microlending firm Tala raised $110M in Series D funding.
In the News
Libra is facing EU antitrust scrutiny. The Facebook-backed digital currency, which has attracted significant regulatory attention since being announced in June, now is “under early scrutiny from the EU’s antitrust regulators . . . amid concerns [it] could unfairly disadvantage rivals.” Many financial and data regulators around the globe have called for a halt to Libra’s rollout pending their investigations.
N26 moves out of beta in U.S. The German digital bank completed its two-month beta test in the U.S., officially rolling out its mobile app to all U.S. consumers. Users who open a mobile account with the company receive an N26 Visa debit card backed by Axos Bank and access to N26’s P2P money transfer service MoneyBeam, as well as financial planning tools and other in-app offerings.
Carney suggests crypto for global reserve currency. At the Economic Policy Symposium in Jackson Hole, Bank of England Governor Mark Carney called out the “domineering influence of the U.S. Dollar on global trade,” and suggested exploring alternatives to replace it. Carney commented that central banks could even adopt a digital “Synthetic Hegemonic Currency” to replace it.
Apple Card launches. The tech giant rolled out its new, Goldman-backed credit card to U.S. customers, who can apply for the card in the Wallet app of iPhones. Consumers could receive approval and begin using the card via Apple Pay within minutes, while a physical card will take several days to arrive (and may the ghost of Steve Jobs have mercy on you if you even think about keeping it in your wallet…😂).
JPMorgan to scrap Chase Pay app. The U.S. bank says it will shut down Chase Pay, its mobile app for payments, in early 2020. Instead, the bank intends to focus on partnering with merchants via a Chase Pay option in their apps or online. JPM launched the app in 2015, just as Apple Pay was gaining popularity. The move follows the closure of the bank’s Finn mobile banking app in June this year.
Goldman Sachs to hire 100 coders. The investment bank is looking to hire more than 100 developers to help automate large sections of its trading business. The new hires will work on the bank’s trading and risk management platform Marquee and update its electronic trading platform. The engineering positions will mostly be based in New York and London.
BoA reports surge in Zelle users. Bank of America (BoA) said it has seen record-breaking use of the big bank-backed P2P payments network Zelle this year. So far in 2019, BoA customers have sent and received 163 million P2P Zelle transactions, compared to 157 million total in 2018. The uptick appears to be driven mainly by younger users – Millennials and Gen Z – eschewing cash payments.
Mastercard announces European data leak. Mastercard’s European unit notified German and Belgian data protection regulators of a data breach affecting customers in their loyalty program. The breach affected mostly German customers, and Mastercard highlighted that it was not related to its payments network. GDPR rules obligate companies to notify regulators of breaches within 72 hours of discovery.
Tala raises $110M for India push. The Los Angeles-based firm, which builds credit profiles for underbanked consumers in developing countries using nontraditional data, raised $110 million in Series D funding to expand into India. Tala builds customized credit scores for users and disburses loans directly to their mobile accounts in under five minutes, with repayment occurring via the Tala app.
Jennifer Lopez and Alex Rodriguez invest in Acorns. The celebrity couple took an undisclosed stake in the savings and investment platform – because love don’t cost a thing, but growing your money does. J-Lo and A-Rod join Acorns’ large celebrity investor base, which includes Ashton Kutcher, Bono and Kevin Durant. On the amount of stock purchased, J-Lo noted, ‘I used to have a little, now I have a lot.’