Receiving Wide Coverage ...
The end of cash?: PayPal wants to “woo the many who haven’t dipped a toe into digital payments yet [by] trying to make the process easier,” its CFO John Rainey says in a discussion of the future of payments and PayPal’s role in it.
In the U.K., the Guardian reports that debit cards will overtake cash as the most frequently used payment method by the end of this year, according to UK Finance, a finance and banking trade group. By 2026, cash will be used for just 21% of payments in the U.K., the group predicts, down from 40% in 2016 and 62% in 2006. Likewise, the amount of money withdrawn at ATMs has fallen steeply in the past few years.
Tweaks needed: Despite problems and criticisms since its founding in 2011, the original mission of the Consumer Financial Protection Bureau — “to protect and empower consumers, promote fair and competitive markets, and stabilize the financial system — is sound,” says Todd Zywicki, a former director of the Federal Trade Commission’s Office of Policy Planning, in an op-ed.
“Well-designed consumer-credit regulation and vigorous enforcement of consumer-protection laws make markets more transparent and give consumers confidence to borrow and save,” he writes. “But poorly designed regulations choke off access to credit, drive up interest rates and eliminate choices, forcing consumers to turn to less desirable financial options — even loan sharks.”
President Trump may not have succeeded yet in fulfilling his promise to “do a big number” on Dodd-Frank restrictions, “but bankers, by and large, say they are happy with the new administration for three reasons,” the Financial Times says: it imposed no major new regulations; its stated intent to cut burdens on the financial sector, and its approach that eased day-to-day supervision..
Wall Street Journal
We would like more, please: Democrats on the House Committee on Oversight and Government Reform have asked Equifax to extend its offer of free credit monitoring and identity theft protection for victims of last year’s data breach to at least three years. The company had offered the free service for one year.
Turned down: The Supreme Court refused to take up appeals brought by hedge funds and other investors who are suing the government over its handling of Fannie Mae and Freddie Mac, which the government took over during the global financial crisis. The suits challenge a move that forced Fannie and Freddie to relinquish almost all their profits to the government. The decision “likely narrows the options for the shareholders to just one legal path: a pending challenge to the Fannie and Freddie profit sweep that for four years has been before the U.S. Court of Federal Claims in Washington, which hears cases against the federal government.”
Regulator dies: The leading official in South Korea’s regulatory clampdown on cryptocurrencies was found dead on Sunday, after an apparent heart attack. Jung Ki-joon, 52, who was head of economic policy at the Office for Government Policy Coordination, was said to be “under heavy stress in recent months” as the government sought to rein in cryptocurrency speculation.
Still losing: LendingClub said it lost $92 million in the fourth quarter, mainly due to a $125 million settlement with investors to resolve lawsuits stemming from a loan-selling scandal two years ago. The loss increased the online lender’s full-year red ink to $154 million, its fourth straight annual loss.
Penalties: HSBC said it may have to pay at least $1.5 billion in penalties to settle tax evasion and money laundering charges against its Swiss private bank. The announcement “casts a shadow over Stuart Gulliver’s final day as chief executive” as he cedes control to John Flint, the bank’s former global head of retail banking.
More jobs, less protection: In a “bold” attempt to lure post-Brexit business away from the U.K. to Frankfurt, Germany’s likely next government will look to make it easier for banks to fire their highly paid executives. “The coalition treaty agreed by Angela Merkel’s conservatives and the Social Democrats contains an outline for the first loosening of employment protection laws in the country in 15 years,” the paper reports.
“The biggest problem we have is that 85% of the world’s consumer payments — the number of transactions — still take place using cash. People have to have a value proposition to switch whatever they’re doing.” — PayPal’s chief financial officer, John Rainey.