Merchant Payments Digest - 11th Edition

Transformational payments solutions:Barclaycard has developed a new ‘Dine & Dash’ solution in the UK that allows customers to bypass the payments process and leave after they are finished with their meal. The new solution is driven by a small device placed on the table. The process works as follows: (1) customers tap the ‘Dine & Dash’ device with their mobile phone in order to check-in, (2) order food, and (3) leave after eating. The device will change color to denote successful payment. The solution is powered by the Barclaycard ‘Dine & Dash’ mobile application, where customers store their payment information. This solution was launched because Barclaycard research found that 36% of diners are frustrated with the current process of waiting for the bill, and 25% of customers would consider leaving the restaurant without paying the bill due to the long wait. Barclaycard will launch this solution in London in March. OpenTable currently offers a similar service called ‘Pay with OpenTable’ in the U.S. that allows diners who make a reservation through OpenTable to pay their bill via the OpenTable app and leave.

Source: Barclaycard, OpenTable
(https://www.home.barclaycard/media-centre/press-releases/Barclaycard-launches-first-Dine-and-Dash-restaurant.html)

Regulatory landscape: The US Securities and Exchange Commission (SEC) is examining tZERO, a blockchain subsidiary of Overstock.com, as part of the SEC’s widespread investigation into potential breaches of securities regulations in Initial Coin Offerings (ICOs), which are a means to raise funds for new cryptocurrency ventures, similar to an Initial Public Offering (IPO). Overstock.com’s CEO, Jack Byrne, believes that the SEC oversight will be beneficial for ICOs as a group moving forward. tZero launched an initial coin offering in December 2017 with a market value of approximately $250 million. Overstock.com was one of the first retailers to accept cryptocurrency as a form of payment in January 2014. Byrne has been a strong proponent of blockchain and cryptocurrency, expecting it to disrupt the financial services industry over the long term.

Source: Fox Business
(http://www.foxbusiness.com/markets/overstock-ceo-on-sec-probe-its-great-that-theyre-doing-this)

Customers’ evolving expectations:

Source: Bloomberg
(https://www.bloomberg.com/news/articles/2018-02-27/debt-conscious-millennials-ditch-credit-cards-threaten-industry)

Data:Debit card fraud is on the rise. A recent report from FICO showed a 10% increase in debit card fraud in 2017 at locations where consumers use their debit card, which includes ATMs and merchant point-of-sale terminals. The increase in fraud is primarily through ‘skimming’; skimming is a type of card theft that uses a small device to attach to any card reader, including point-of-sale devices, and captures card information stored in the magnetic stripe. Outside of ‘skimming’, a study conducted by Javelin Strategy & Research shows that of the financial and non-financial data breaches in 2017, which includes SSN, credit card, debit card, and driver’s license fraud, debit card number theft was third highest. 16% of fraud victims had debit card numbers stolen through point-of-sale purchases, ATM withdrawals, and other hacking methods.

Source: CNBC 
(https://www.cnbc.com/2018/03/06/protect-your-bank-accounts-from-rising-debit-card-fraud.html)

New providers:

Source: USA Today
(https://www.usatoday.com/story/money/2018/03/05/report-amazon-checking-accounts-something-similar-could-coming-soon/394470002/)br>