Payments News Digest 10 March 2023

US/Europe: PSPs revising terms as margins squeezed in transforming environment

In the United States, Square is raising its fees by 25 basis points to 1.75 percent for instant/same-day transfers from its platform to external bank accounts, although such transfers that take place the next day will continue to attract no fee. Online sellers using the service will also see a rise in the monthly price: when paid annually, the per-month charge for a mid-tier contract will go up three dollars to $29, while merchants on the next tier up will see a rise of seven dollars to $79.

Across the Atlantic, in the 30-country territory of the European Economic Area, Stripe too intends to raise fees, in its case for card processing from 10 April: again these are percentage adjustments rather than fixed-fee iterations. The company, co-headquartered in Ireland and California, is citing as the cause "major card networks [that] have introduced several new fees and increased existing fees".

Brazil: WhatsApp allowed to offer person-to-business payments services

From Brasilia comes news that the authorities have granted long-sought permission for WhatsApp to expand beyond person-to-person payments to also serve the P2B sector: a new facility in the app will now incorporate the familiar sights of inventories and shopping carts with cards acceptable at the checkout. The green light had been expected since November, when the central bank permitted credit fintechs to provide payment-initiation services, removing the need to establish a separate company for that role. That ruling was quickly followed by the granting of payment-institution status to Google Pay.

Now Mark Zuckerberg's Meta has scored its own key strategic win, having been in the P2P payments business here since May of last year with transaction features baked into its chat interface for friends and family wishing to transact financially. The service was first launched in mid-2020 but, faced with a regulatory requirement to get a licence as an initiator rather than simply avail of the ones possessed by Visa and Mastercard, it had to wait until the following year to begin P2P operations, all the while maintaining a constant dialogue with the central bank on commercial expansion.

As readers will know, Brazil has been a payments trailblazer in recent years: in October 2020, the central bank launched 24/7 instant payments service Pix. Available to non-banks, including the growing number of fintechs, and free of charge for individuals, the platform allows users to easily make transactions through participating institutions' apps, websites and ATMs. Pix has enjoyed sensational success: within 18 months of its arrival, it had reached over 1.6 billion transactions per month made by 104 million users.

Australia: Affirm draws back from high-profile overseas foray

In the pay-later sector, caution remains the order of the day, with leading player Affirm announcing that it is leaving Australia, once BNPL's banner market globally. Existing borrowers in the country are unaffected, but new loans will not be offered by the San Francisco-based company from this month on. The balance of power in the market has been shifting with Openpay's recent collapse and one of the big banks, Westpac, having launched its PartPay instalment-loan product: like Affirm it has no late fees, but unpaid balances are added to an interest-bearing credit card.

Other stories of interest this week...

China: WeChat follows Alipay to integrate fast-payment function of digital-yuan wallet
Germany: Carmaker's new Pay app turns Mercedes-Benz cars into payment devices
Romania: Poland's BLIK enters market, starting with e-commerce
US: Visa aims to lower credit-surcharge ceiling

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