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According to a lengthy report from the Financial Times yesterday, citing unnamed sources and internal documents, executives at Meta (parent of Facebook, Instagram and WhatsApp, among others) are retooling their currency aspirations, regulators having torpedoed its high-profile push to reinvent the world's payments system in the form of new digital currency. Now the company's focus is on the exchange of value within the metaverse. That much-heralded online innovation may or may not be the Next Big Thing, but Facebook, fast losing ground to TikTok in the social media space, needs it to be.
As the FT reminds us, in-app tokens are nothing new: in fact, Facebook was reliant on them for almost a sixth of its revenue at the time it went public a decade ago, though the service was eventually dropped on the grounds of expense. Now Mark Zuckerberg and his team, particularly new fintech head Stephane Kasriel, are betting that the metaverse will be so immersive that the so-called 'ZuckBuck', as insiders are apparently calling it, will function as a de facto currency for everyday transactions; their parallel exploration of Non-fungible tokens (NFTs) therefore stands to reason as it grants unique status to digital entities that would otherwise be interchangeable and infinitely duplicable, thus undermining value. Some of Meta's plans, none of which have been confirmed by the company, appear less speculative: for instance, it has reportedly been in talks with potential partners in connection with loans to small businesses.
Two stories from Europe underscore the commercial possibilities that can be unleashed through cutting-edge API interfaces: in Germany, where payment by invoice is a mainstream option for online shoppers, Nexi's RatePay subsidiary has entered into an exclusive partnership with PayPal Checkout for these services. The upshot is that non-PayPal shoppers could avail of a BNPL solution while enjoying a seamless checkout that does not take them to an unexpected server, an understandably offputting experience for many shoppers. RatePay's newly upgraded API makes processing in the background technically possible. Meanwhile Klarna, also using programming-interface tech, has opened a new division called Klarna Kosma to bring Open Banking to the party as a potential competitor to card payments or e-wallets through payment-initiation services provision. Although it has markets such as Australia, New Zealand and Canada in its sights, to date the service is confined to the US and also European markets.
In other Klarna news, the rapidly morphing financial services company is spending a reported billion dollars in acquiring PriceRunner, a platform comparing prices for over three million different products to shoppers in the United Kingdom as well as the three largest Nordic economies. That functionality will now be folded into the rapidly expanding Klarna app, whose ultimate ambition is to shake-off any pure-play BNPL association and emulate the Chinese superapps: "That to me is the future – the pure one-trick ponies won't survive", chief marketing officer David Sandstrom told trade website The Drum last month.
Financial services software specialist Temenos and Mastercard have announced a partnership to accelerate Request to Pay (RtP) adoption in the United Kingdom. Mastercard first introduced a solution within the RtP framework of Pay.UK a year ago, providing a service that connected biller systems with end-user applications (such as a consumer-facing mobile app) to facilitate creation, sending, viewing and responding to billers' payment requests. As neatly explained in the Temenos press release, the new protocol "enables billers to dynamically request and manage the payment for a bill rather than simply sending an invoice. The payer receives a curated digital request on their internet or mobile device through a banking or third-party fintech application. The payer can either partially or fully approve, defer, or even reject the request, enabling them to manage their bill payments better. However, if approved, a payment order will be submitted for execution within the bank via a preferred route, including through the Faster Payments system, allowing the Biller to receive funds in real-time."
Other stories of interest this week...
Australia: ANZ Worldline Payment Solutions launches in Big-Four first
UAE: Mashreq consolidates existing payment systems into Neopay
US: Banks consider adding Zelle to retail payments
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