12.5.18 Your morning briefing

The information you need to start your day, from PaymentsSource and around the Web:

AI is A-OK
The U.S. government won't punish banks that use artificial intelligence and similar innovations to locate gaps in anti-money laundering systems, a move that could cause a rush of new AML tech purchases at financial institutions.

A group of government offices including the Federal Reserve, the FDIC, FinCEN, the NCUA and the OCC are encouraging the use of new technology to bolster security and crime prevention and plan to engage with financial institutions and vendors on the usage of AI-driven AML technology.

While the agencies can provide feedback to banks, they should not criticize unsuccessful attempts to bring more technology to crime prevention, according to the government's letter.

Andrew Harrer/Bloomberg

Up in the Air
Drones have always been a more forward-looking element of e-commerce, and Amazon drew a lot of attention when it told 60 Minutes in 2013 that drone delivery be available in five years.

That was five years ago, and media outlets such as Gizmodo and the Associated Press are noting Amazon drones are not regularly landing on consumers' porches with airborne deliveries.

The AP reports drones are widely used to deliver medical equipment to rural areas, though there's little retail use. It also quotes Amazon as saying it's still working on drone delivery, but does not have a timetable.

Another five year promise
Fintech and open banking regulations will cause a "massive disruption" in the banking industry over the next five years, according to Klarna CEO Sebastian Siemiątkowski.

Siemiatkowski attributed the threat to the PSD2 regulation, which will make it easier for fintechs to develop new financial products, reports HITC, which quoted Siemiatkowski at a CNBC event in Helsinki.

Klarna's roots are in installment payments, but it has added more payments and e-commerce technology as it prepares to move deeper into financial services and expand geographically.

Placing another call
T-Mobile, which was was part of an early and unsuccessful mobile wallet scheme in the U.S., is trying a new venture in partnership with BankMobile, the digital arm of Customers Bank.

The telco will offer a Mastercard debit card, check deposits and support for Apple Pay, Google Pay and Samsung Pay, reports Finextra.

T-Mobile was part of the ISIS/Softcard mobile wallet, which shut down and sold its assets to Google in 2015. The telco also offered a prepaid card for about two years, starting in 2014.

From the Web

Mastercard to incur $650 million fourth-quarter charge for EU antitrust fine
Reuters | Tue December 4, 2018 - Mastercard will incur a $650 million charge in the fourth quarter of this year because of a substantial fine related to a second EU antitrust investigation, the world’s second largest payments network operator said on Tuesday. The European Commission three years ago accused the company of having rules which blocked banks in one EU country from offering lower interchange fees to a retailer in a second EU country.

Marriott breach sparks multibillion-dollar suits, with more to come
CBS News | Tue December 4, 2018 - Two class-action lawsuits already have been filed against Marriott after the hotel chain revealed a massive breach of its systems that compromised 500 million customers. One of the suits is seeking billions in damages.

29% of Freelancers Wish to be Paid in Crypto: Are Legacy Systems Inefficient?
CCN | Tue December 4, 2018 - According to a survey conducted by Humans.net, a job recruitment platform, 29 percent of freelancers would rather get paid in crypto over legacy systems and banks. The survey, which covered 1,100 U.S.-based freelancers, disclosed that 18 percent of the respondents would like to receive all of their payments in crypto while 11 percent would prefer to receive a portion of their payments using digital assets.

More from PaymentsSource

'Tis the season for a Walmart tech overhaul?
It's commonly thought that retailers are loath to upgrade the point of sale as the holidays approach, since they don't want to introduce any variables that could lead to lost sales.

With digital ID up for grabs, Mastercard makes its play
Consumers are stuck using outdated or easily compromised means of proving their identities in a world where banks and retailers need something better. Mastercard and Microsoft are teaming up to take on this monumental challenge.

Finnish fintech seeks to undercut banks with secure cloud
Banks are generally reluctant to let industry entrants run their infrastructure, and few fintechs dare try. Enfuce, which was founded by local industry veterans, bucks the trend.

New loyalty should ‘give’ before it ‘receives’
Premium loyalty is about brands and customers committing to each other from the start. It’s about brands aligning with their customers and giving upfront, according to Tom Caporaso, CEO of Clarus Commerce.