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Want to talk to a brand? There’s a bot for that

Friday, April 15th, 2016

MEF logo

Facebook wants to replace apps, call centres and maybe even websites with chat bots. Tim Green wonders if this is a new era for the internet – and if it’s a good idea for one company to own it…
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This week the manager of Southampton football club confirmed he sends his players to weekly verbal communication sessions. Apparently, the lads never talk any more.

They prefer to zone out inside their massive Beats headphones and stare at their iPhones. I expect they’re researching monkey tattoo ideas on Instagram.

The story made a big splash in the UK this week. It clearly touched a nerve.

We’re all aware of the isolating effect of the smartphone on modern life. At a restaurant recently I was transfixed by a family at the table next to me. The two kids wore huge headphones and played iPad games, while the Mum tapped away on her phone.

Not once through the entire meal was a single word exchanged.


And yet it’s not quite true to say that people can’t communicate any more.

I’d say the opposite is true. All people are doing when they are staring at their Galaxy S7s is communicating.

It’s just that – much of the time – they’d rather correspond with a Facebook friend or Twitter follower than the blood relative sharing their pizza.

This strange impulse to avoid human contact is inside all of us. I know it’s not just me who would rather consult Google Maps than ask a stranger for directions. Or get answers from an instant chat session rather than call customer support.

Which brings me to Facebook’s big announcement this week. At the firm’s big F8 developer event, Mark Zuckerberg unveiled a new chatbot system for Messenger.

The big idea here is to let people chat with organisations to get information, answer questions and maybe even buy stuff.

Here’s how it would work (I think). You could add a brand bot to your contacts from a menu or via a search bar inside the Messenger app.

Thereafter, the brand can send you relevant information and you can ask it questions – all using the convenient medium of a chat session.

Crucially, the chatbot can do more than just send texts. It can send emails, show videos and pics, maybe even process transactions.

In a way, the bot is more like a mini app than a mere text sender.

One can imagine how a clothing brand could tell you about a new item and you could buy it just by saying ‘yes’.Image 3

While this might just seem like an interesting new comms channel for enterprises, it may in fact signal a huge moment in the history of the internet.

Think about it. If we start talking to brands this way, it’s the beginning of a slow death for apps, websites, push notifications and all the other comms channels we’ve learned to use in the last 20 years.

In fact, Facebook Messenger boss David Marcus was candid about this.  He said: “A thread of conversation is a much better form of app. A Messenger chat retains your identity, the context of your previous conversations and always follows on logically from your last message.”

History shows us that every comms channel is eventually eclipsed.

Technological advance is always based on making things easier to do. Email was better than the post. The app was better than the desktop site. It’s all about getting the right answer quickest. In this respect, maybe human conversation via chat apps wins.

Except they’re not human conversations. They’re bot conversations. That’s the irony.

Of course, this is not a done deal. Last year, Facebook tried to turn Messenger into a mini app store, and that doesn’t seem to have made much impact.

And sometimes messaging can be a terrible medium. I recently downloaded the app from the website Quartz. Its bold idea was to present the news as a chat stream.

Bold but woeful. It just didn’t work. Who wants to have a conversation to get to a news story rather than just browse and click? I deleted it immediately.

Also, inevitably when Facebook is involved, the issue of privacy is always close by. Can Messenger users be sure their conversations won’t be scanned and used by Facebook for advertising purposes? If so, will they care?

Another issue of concern is the way that the chatbot move could consolidate yet more power in the hands of a handful of companies (Microsoft is also supporting chatbots on Skype).

Let’s assume brands abandon sites and apps in favour of cheap-to-build chatbots. That makes companies like Facebook and Microsoft one step closer from providing services on the internet to being the internet itself.

No matter how principled these firms are, that can’t be a good thing.

Canadian banks embracing fintech even as global CEOs see threat in technology: PwC

Thursday, April 14th, 2016

Financial Post

  Barbara Shecter

Financial Post 2

  Canadian banks are actively pursuing opportunities to play an integral part in the growth of fintech, despite the fact that 81 per cent of global banking CEOs see the pace of technological change as a threat, PwC says in a new report.

The consulting firm says the big banks in Canada are “laser-focused” on responding to both threats and opportunities presented by fintech companies, many of which combine technology and readily available online data to offer competitive products and services such as personal and business loans.

There are now more than 80 fintech companies in the country, mostly headquartered in Toronto, Waterloo, and Vancouver, which have attracted investments of about $1 billion since 2010, according to PwC.

Canada is also attracting competitive firms such as New York-based small business lender OnDeck, and Chicago-based “near-prime” lender Avant, that have found success in the United States.

Some fintech firms are working with banks on innovation, while others are bound to present “a series of disruptions and threats” as they make inroads into banks’ traditional territory, PwC says.

“If Canada’s banks don’t keep up, they run the risk that outside competitors will bring their proven, successful offerings to Canada and slowly erode market share,” the report warns.

The consulting firm predicts Canadian banks will ultimately pursue parallel strategies. In some cases, they will collaborate with and “leverage” the expertise of fintechs. At the same time, they will focus on internal innovation in order to compete with others.

PwC notes that Canadian banks have already been dipping into fintech in a concrete way, some since early last year. Canadian Imperial Bank of Commerce, for example, entered a partnership to create a corporate innovation hub at MaRs in Toronto. The bank then teamed up with online small business lender Thinking Capital in a referral partnership.

Bank of Nova Scotia made an investment in Kabbage, a U.S.-based online small business lender, and created an internal “digital factory” to focus on technology and mobile banking — often in partnership with external start-ups.

Toronto-Dominion Bank, meanwhile, partnered with Moven, a mobile personal financial management platform, to establish an innovation lab at Communitech. TD is also collaborating on technology innovations targeting customers and employees in Cisco’s new Toronto Innovation Centre.

Royal Bank of Canada is testing of payments technology with Nymi Wristband, and forged an alliance with Uber for loyalty rewards.

Earlier this year, Bank of Montreal launched SmartFolio, a digital portfolio management service designed to compete with both traditional players and “roboadvisers.”

As for the fintech companies, the PwC report suggests their rapid growth could eventually attract regulatory scrutiny.

“Currently as peripheral players, some fintechs are able to navigate without the same burdens” as banks, the report said. “As they continue their evolution, the regulatory environment might evolve to bring constraints that will likely impact their progress.”

The report suggests this scrutiny is likely to pick up once fintech risk models and loan approval algorithms, some of which use “social” data, are put to the test in a downturn.

Financial Post

The retailers Canadians trust most (Survey)

Tuesday, April 12th, 2016

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Best Buy and Canadian Tire are the two strongest retailers in new BrandSpark survey

 By Rebecca HarrisBrandspark
 Homegrown retailers Canadian Tire, Shoppers Drug Mart and Real Canadian Superstore made the list of Canada’s most trusted retailers.

In the Canadian Shopper Study by market research firm BrandSpark International, 7,500 respondents were asked to name the retailers they considered their most trusted in 16 household and personal shopping categories.

Canadian Tire is the most trusted in auto parts and accessories, Shoppers Drug Mart is the most trusted in health/pharmacy and beauty/personal care, and Real Canadian Superstore is the most trusted supermarket.

American giant Walmart came out on top in several categories including department store, housewares/kitchenware and mass merchant, and tied with Carter’s for baby and children’s clothes.

Also on the list are Hudson’s Bay for clothing/fashion, Best Buy for electronics, Payless for footwear and HomeSense for home décor.

“Canadians are on the hunt for value, and it’s interesting that some value brands, including Payless and HomeSense, have now become the most trusted retailers in the country,” said Robert Levy, president and CEO of BrandSpark International.

Overall, the highest-scoring retailer in terms of percentage was Canadian Tire, followed by Best Buy. When looking at the top retailer by margin of victory (how much further ahead a retailer is than its closest competitor), Best Buy is number-one, followed by Canadian Tire.

While some retailers, including Canadian Tire, Best Buy and Toys R Us, lead their categories from coast to coast, there are some key regional differences. In Quebec, Jean Coutu is the most trusted retailer in health/pharmacy and beauty/personal care.

Rona is the most trusted home improvement retailer in Quebec, while Home Depot takes the top spot in B.C., the Prairies and Ontario. In Atlantic Canada, Home Hardware is the most trusted home improvement retailer.

The grocery landscape also varies widely by region, with Loblaw-owned No Frills earning the top spot in Ontario and IGA taking the top spot in Quebec. Loblaw’s Superstore banner came out on top in B.C. and the Prairies, and tied with Sobey’s in Atlantic Canada.

Only in Quebec and Atlantic Canada were non-priced focused brands on top, said Levy. With Canadians looking for value for money, “it’s not a surprise that the supermarket brands offering consistent high value fare so well.”

In fact, value is the number-one factor driving trust in most categories, said Philip Scrutton, BrandSpark’s director of consumer insights. “Consumers look to get value in different ways. [For example] Walmart shoppers want low prices, while Shoppers Drug Mart shoppers, most of them are using the Optimum rewards program and they’ll see value collecting points.”

Other key factors are a strong selection of quality products, and a consistent and convenient shopping experience.

Trusted Retailers  1

The full list of most trusted retailers can be found here.

Postal Worker Unions Team Up to Pitch Postal Banking

Tuesday, April 12th, 2016


 The unions representing Canada’s postal workers are rolling out a new social media campaign this week to convince the public and the Liberal government to bring back postal banking.

With a review of Canada Post expected any day now, the Canadian Union of Postal Workers and the Canadian Postmasters and Assistants Association are issuing a series of five whiteboard videos in both official languages, asking Canadians to “imagine a bank that would have more branches across the country than all other banks combined.”

Postal banking is also resonating south of the border, championed by presidential candidate Bernie Sanders and Massachusetts Senator Elizabeth Warren, as well as the United States Postal Service Office of the Inspector General.

Both the CUPW and the CPAA are calling for the release of Canada Post’s own heavily censored recent study on postal banking and hope the Liberals’ public review will finally bring it to light.

“Postal banks are an alternative to payday lenders, providing basic financial services to the millions of people currently excluded from access to Canada’s big banks,” said Mike Palecek, CUPW national president.

Such communities include rural residents, Indigenous people, low-income families, and migrant and precarious workers, who currently pay hefty remittance and cheque-cashing fees.

“The Liberals need to consider what a 21st century post office could be doing for all of us,” said Brenda McAuley, national president of the CPAA. Banks in rural areas are difficult to access, said McAuley, whereas post offices can be found everywhere.

Over sixty other countries currently have postal banks, with a variety of models available, ranging from partnerships with bigger banks to wholly publicly owned operations. What they all have in common is shoring up revenues for postal systems. Some postal banks have been extremely successful, such as France’s La Banque Postale and New Zealand’s Kiwibank.

“Kiwibank turned a profit in just 3 years and recently passed the $100 million profit mark,” said Palecek. “La Banque Postale supports social housing funding and its customers don’t pay ATM fees. There’s no reason why we can’t accomplish such things in Canada.”

Top 5 Reasons Why Your Business Should Take Checks as Payment

Tuesday, April 12th, 2016

First Data logo

Man writing a check

Consider the following scenarios: perhaps you’re opening up a new business or you’re updating your current point-of-sale systems. Traditionally you’ve taken credit cards and debit cards, and as always, cash is king, but what about other forms of payment?

 Specifically, what about checks?

 If you look at the numbers, there’s a lot of life left in checks. For example, in it’s latest study, the Federal Reserve reports over 18 billion checks being paid with a total value of $26 trillion dollars1—and that’s just paper or electronic checks alone.

So you see, there’s still a lot of money being exchanged via checks—but if you’re still not sure that checks are right for your business, we’ve compiled the following reasons you should reconsider:

  1. Checks are very popular among consumers. How popular, you ask? According to the Federal Reserve Bank of Boston, millions of U.S. customers have checking accounts, but do not have a credit or debit card2. In addition, a different study concluded that 90% of U.S. customers have a checking account3. Considering their near ubiquity, perhaps you should consider adding this tried and true payment method.
  2. Checks give consumers more options. That is, according to small businesses. According to a recent survey, 71% of small businesses agree that checks allow them to offer their customers more payment options4.
  3. Checks make consumers feel safer. According to recent TeleCheck research, many customers choose checks because they believe checks are less susceptible to fraud than payment cards5. If you want to provide safe payment options, checks might be the way to go.
  4. Checks pay more than other forms of payment. Did you know that the average credit card swipe is $50, and that the average check amount is 3x that6? Bigger tickets for you mean bigger payoffs for your business, which is something every business owner strives for.
  5. Checks don’t require someone to be internet/smartphone savvy. According to the Pew Research center, 15% of U.S. adults don’t use the internet7. With such a resistance to technology, it’s important to businesses to cater to these consumers by offering payment options that they’re comfortable with—and that means checks.

Whether you’d like to admit it or not, checks are still alive and kicking, with millions of dollars being paid by checks every day by millions of consumers. If you’d like to capture your business’ share of those dollars, it’s important you offer a wide array of payment options that every consumer is comfortable, and today, those options still include checks.

1 2013 Federal Reserve Payments Study
2 Federal Reserve Bank of Boston, 2014
3 Ibid
4 TeleCheck SMB Brand Awareness Study, April 2015—Research by Lynx Research Consulting
5 TeleCheck Consumer Brand Awareness Study, March 2015—Research by YouGov
6 TeleCheck Business Analysis, 2014

CIBC is no longer the underdog of Canadian banking as performance and dividend beat rivals

Monday, April 11th, 2016

Financial Post logo

Doug Alexander, Bloomberg News

Victor Dodig’s overhaul of Canadian Imperial Bank of Commerce is paying off.

Total returns and profitability at the former underdog of Canadian banking are top among its peers and its dividend yield is the fattest of the nation’s five largest lenders. With the bank’s domestic operations sharpened, the chief executive officer is on the hunt for a U.S. acquisition that could help diversify its operations.

“On a five-year and 10-year basis, if this leadership team can deliver total shareholder returns that are at the top of the heap, that would be a very good outcome,” Dodig, 50, said an an interview in Vancouver Tuesday, where the bank held its annual meeting.

CIBC image 1

The Toronto-based lender had a total return of 11 per cent in the 12 months through March 31, more than double the 5.4 per cent advance of the eight-company Standard & Poor’s/TSX Commercial Banks Index, due in part to raising its dividend for six straight quarters.

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CIBC is also Canada’s most profitable bank, with a return on equity of about 19 per cent, compared with Royal Bank of Canada’s 17 per cent, Bank of Nova Scotia’s 14 per cent and Toronto-Dominion’s 14 per cent, according to data compiled by Bloomberg. CIBC’s tier 1 capital ratio of 10.6 per cent makes it the country’s best capitalized bank, while it’s dividend yield of 4.55 per cent is the highest among Canada’s five largest lenders.

Simplify Operations

John Kinseyof Caldwell Securities Ltd. in Toronto said he’s been impressed by the bank’s performance under Dodig, who took over about 18 months ago. “This is a pure personal-and-commercial bank, so if our economy does well, they will do well,” said Kinsey, who oversees about $1 billion, including bank shares.

Dodig, who became CEO in September 2014, has focused on improving CIBC’s retail lending business, with a greater emphasis on becoming a more nimble, technology-driven bank. The firm plans to simplify operations and revamp branches as its seeks to push earnings growth to 5 per cent to 10 per cent over the next three years from about 5 per cent in the past four.

Every Pothole

“CIBC had gone through a period where it had been looked over and I think portfolio managers certainly feel more comfortable at least having an honorable mention of the name in their portfolios,” Sohrab Movahedi, a BMO Capital Markets analyst, said in an interview.

Investors in the 2000s shunned CIBC as bad bets on telecommunications firms, failed energy trader Enron Corp. and structured debt led to billions of dollars in losses. CIBC posted more than $10 billion in writedowns tied to U.S. debt securities following the financial crisis, the highest among Canadian lenders. Former CEO Gerald McCaughey, spent years “derisking” the bank and Dodig is now building on that.

“We wouldn’t have bought it a decade ago,” said Kinsey, whose firm now owns some of the stock. “They just made one mistake after another. A long time ago, if there was a pothole in the road Commerce would hit it, but that hasn’t happened in a long time.”

U.S. Purchase

Dodig said Tuesday the bank has the flexibility to spend as much as $4 billion on a deposit-taking commercial bank in the U.S. following the sale of its stake in American Century Investments. CIBC has been trying for more than three years to find additional acquisitions in the U.S. to build up its wealth-management business and diversify.

Domestic retail and business banking contributed 70 per cent — or $2.53 billion — of CIBC’s fiscal 2015 profit, according to financial statements. That’s the highest among its Canadian peers and compares with about 50 per cent for Royal Bank, Bank of Nova Scotia and Bank of Montreal. Toronto-Dominion receives 55 per cent of earnings from Canadian commercial-and-personal lending.

CIBC’s concentration in domestic retail banking puts it at a disadvantage for investors such as Kinsey, who find lenders with U.S. exposure more appealing at a time when the American economy is gaining traction. Canadian households also have a record ratio of debt to disposable income amid housing booms in Toronto and Vancouver.

Deliver Goods

CIBC set a goal in October of getting $3 billion in adjusted profit by 2018 from retail and business banking, a 19 per cent increase from the fiscal year ended Oct. 31.

CIBC no longer trades at as wide a discount to the other Canadian banks as it once did, which will make it harder to stand out among its peers, Movahedi said. He expects CIBC to trade in line with the Canadian banks index in the next 12 months, requiring the lender to find other ways to distinguish itself.

“Investors gave them the benefit of the doubt, and now it’s going to be more about delivering the goods than convincing them to trust you, so to speak,” Movahedi said.

Dodig said he’s not troubled that he can’t win over all investors, despite the bank’s winning streak.

“We’ll earn their trust over time,” he said, “I’m not in a rush to convince anybody overnight that they should be holding a position in our company.”

Dream Payments Strengthens Leadership Team, Laying Foundation for Global Expansion

Thursday, April 7th, 2016

Dream payments Image

Dream Payments (“Dream”), a Toronto based fintech solution provider and payment cloud operator, today announced executive appointments that will strengthen its leadership team and support the company through its next stages of growth.

Jordan Cohen, former President of Global Payments Canada, joins Dream as the company’s Chief Commercial Officer; fintech executive Christian Ali formerly of SecureKey and EnStream has been appointed Chief Marketing Officer; and Priya Sirwani former head of Cyber Security Assurance at Emirates, has been appointed Chief Information Security Officer. 

Having launched its rapidly growing MPOS and mobile payments service in Canada in 2015, Dream is the world’s only mobile platform that enables Interac® Debit and Chip & PIN credit card payment terminals to be sold off-the-shelf. Many businesses today that seek payments mobility — from small merchants on-the-go to larger enterprises aiming to make their outbound workforce more agile — rely on Dream to provide a secure, affordable, and complete mobile point of sale solution.

Dream is experiencing rapid growth in the market, powered by its patented device management and rapid adjudication technology. Dream’s ability to significantly reduce costs associated with supply chain management and onboard customers within minutes, enables financial institutions to serve their customers in a manner not previously possible due to legacy system constraints.

“As Dream continues through its next phases of rapid growth, Jordan, Christian and Priya bring the talent and expertise needed to expand the business globally,” said Brent Ho-Young, Founder and CEO of Dream Payments. “Dream’s mission to bring best-of-breed devices, application partners, and distribution channels to merchants, acquirers and other trusted brands is being realized. Adding talented executives such as Jordan, Christian and Priya will support Dream as we expand into the US, Europe and Latin America.”

“Globally acquirers typically compete using common platforms offered by traditional hardware solution providers,” said Mr. Cohen. “The industry has been looking for a truly open solution that moves away from a device-centric approach and enables acquirers to focus on differentiated, value added service. Dream adds tremendous benefits within the merchant ecosystem and I am delighted to introduce acquirers globally to Dream’s unique MPOS platform.” As Chief Commercial Officer, Mr. Cohen will oversee growth strategies for the company within Canada and internationally, and will continue to strengthen relationships between Dream and its strategic partners.

“With the products that exist in the market today, merchants and acquirers have been denied affordable, mobile-first payments solutions that offer a choice of best-of-breed capabilities. Over the next few months Dream will be announcing several unique collaborations and features that will provide a meaningful difference to merchants and acquirers,” stated Mr. Ali. “I am truly excited to be part of this dynamic and growing technology company.” As Chief Marketing Officer, Mr. Ali is responsible for the global strategy and execution of all facets of marketing, including media and public relations, and industry partnerships.

Mrs. Sirwani commented that, “Dream’s end-to-end encryption and tokenization technology delivers a complete out-of-the-box certified solution. We have worked closely with the world’s leading banks to ensure that merchants have complete peace of mind that their business’s data is secured by the most advanced technologies and processes available today. I look forward to joining Dream and further growing its capabilities as a global leader in information security for mobile payments.” In her role as Chief Information Security Officer, Mrs. Sirwani is responsible for providing oversight to Dream’s information security, privacy, risk management, and compliance programs. 

For more information regarding Dream Payments solutions please visit To see a live demonstration of the Dream Mobile Merchant Services Platform and Dream’s Mobile Point of Sale solutions, please visit Dream at the Transact16 Conference, Booth #738, April 19th – 22nd, 2016. To schedule an appointment for a demo or a meeting with a Dream Payments executive, during or after the conference, please contact

6sense Announces Patent Protecting Machine Learning Method to Predict B2B Sales

Monday, April 4th, 2016

6sense logo

Patented Method Provides Unprecedented In-Market Buyer Visibility

6sense, a predictive intelligence platform for enterprise B2B marketing and sales, announced that the United States Patent and Trademark Office has issued the company a patent, invented by CEO and founder Amanda Kahlow, covering a machine implemented system and method of predicting future sales, leads and opportunities based on static data and/or intent buying behavioral data by connecting data from one or multiple sources.

After a breakthrough year in 2015, with 3X growth in annual recurring revenue and new customers including ADP, Blue Jeans Network, Dell, Dropbox, HP, IBM and Salesforce, the patent validates 6sense’s unique formula and market leadership. 6sense’s rise as a thought leader and pioneer in the B2B predictive intelligence space is attributed to its innovative, patented full-funnel predictive solution and quantifiable results for its customers.


The 6sense patented approach enables, in certain embodiments, the collection of intent and/or static, profile fit data, transformation of unstructured data into structured data, calculation of buyer intent signals, mapping of unknown prospects to known buyers, and the ability to determine where buyers are in their journey (awareness, consideration, decision, purchase). The patent supports what 6sense views as the future of B2B marketing and sales: Omni-channel connectivity, visibility, attribution and the predictions to target the right audience at the right time, when they have demonstrated a need and propensity to purchase.

“Among our accomplishments over the last several years, receiving this patent tops the list. After years of hard work and a five-year-long filing process, I hope this patent communicates to our customers, prospects and the wider industry that we truly were the first to market,” said Kahlow. “When we started this journey, I knew we were onto something that no one else was thinking about, let alone doing yet. Aside from what this milestone means for 6sense, if it can serve as an inspiration to any woman at a time when women hold only a small fraction of technology patents, I’ve succeeded beyond my wildest dreams; I know at the core of it all, my purpose in life is to inspire women and girls.”

This patent protects the core of 6sense’s platform, focusing on time-based activity data to help its customers understand when prospects are in the buying cycle for their products. 6sense’s network of intent data (blogs, communities, forums, trade publications) is connected to customers’ internal data sources (weblogs, CRM and marketing automation) to give them a full picture of all the buyers that are in-market for their solutions. 6sense helps its customers ensure that their messages are not only hitting the right audience, but tailored to their specific needs and pain points at the time.

“We are thrilled to be working with some of the industry’s brightest minds in B2B marketing and sales and this patent truly validates our approach. The 6sense platform opens up the outside world of buyer intent data to our customers and provides unparalleled visibility into buyers’ needs and their journeys long before they lean in and raise their hand (AKA fill out a lead form),” said Kahlow. “Buyer activity is much like walking on wet sand. Every day, potential customers leave an abundance of digital footprints all over the web that reveal imminent buying intent. Our patent protects our method of uncovering these buyers and allows us to put all of our energy into solving sales’ greatest pain point – buyer needs and timing.”

TD chief Masrani seeks level playing field with startup fintechs

Monday, April 4th, 2016



Toronto-Dominion Bank’s chief executive officer identified tech-savvy upstarts as a key challenge for the lender, but asked policy makers to consider new rules to level the playing field with established banks.

“Thousands of fintechs are vying for bank customers,” Bharat Masrani said at the bank’s annual general meeting in Montreal on Thursday. While competition is a good thing, he argued that new financial technology players – some of which lend money to small businesses through online services – are often not subject to the same regulatory rules as traditional banks, suggesting an unfair advantage and the potential for security lapses. “That’s why I believe it would be appropriate for policy makers to consider a regulatory environment that ensures the safety of customer information and the integrity of our financial system,” Mr. Masrani said, adding that security breaches and service interruptions have plagued a number of fintechs.

In a conference call with reporters following the annual meeting, Mr. Masrani was reluctant to provide specifics on what policy changes he would like to see or examples of security breaches.

However, some of the most notable breaches in recent years have involved major firms with big budgets to defend themselves against attacks. In 2014, a cyberattack against JPMorgan Chase & Co. compromised accounts for 83 million households and small businesses. Recent attacks have also targeted Home Depot Inc., Sony Pictures Entertainment Inc. and Target Corp.

TD itself was the target of a denial-of-service attack in 2013, when a flood of online traffic knocked out access to the bank’s website and mobile banking services.

Despite highlighting fintech as a competitive threat that enjoys unfair advantages over traditional banking, Mr. Masrani made it clear that TD was hardly struggling.

He said the bank would engage with some fintech firms as potential collaborators, and sees the rise of new ideas and technology as a huge benefit to consumers.

“We engage with a wide range of firms who can support our mission to seamlessly fulfill the wants and needs of each and every customer,” he said.

Nonetheless, his point about rising competition and a potentially disruptive threat to traditional banking has been supported by many observers.

A report from Citigroup this week highlighted the threat globally. It estimated that banks in the United States and Europe will slash another 1.7 million jobs over the next 10 years – representing about 30 per cent of their current payrolls – as they react to competition in areas such as lending and payments. Investments in the fintech sector surged to $19-billion (U.S.) in 2015, up tenfold over the past five years.

“The banks have clients and scale but the new fintech entrants usually have the innovation edge, especially at the ‘client experience’ interface,” Citigroup analysts said. “To remain competitive, banks need to get innovation before the fintech companies get scale.”

Mr. Masrani appeared to agree with this assessment. He noted that TD has partnered with Cisco Systems Inc. to create a lab for building tech-focused banking enhancements and joined an international consortium to explore the benefits of blockchain, the technology that underpins bitcoin.

He also noted recent enhancements to the bank’s online brokerage, WebBroker, and announced that TD would soon launch an application called TD MySpend, which will provide customers with a visual representation of their financial health on their smartphones.

“The world is changing around us, and I cannot say with 100-per-cent certainty what the future looks like,” he told his audience. “But I do know this: TD will adapt without abandoning what you have come to expect from us.”

Facebook: The New Game Changer for Mobile Payments & Remittances

Monday, April 4th, 2016


Image 1

As predicted last year, new financial players especially social media giants like WeChat and now Facebook can be major players in the mobile payment space.  Facebook in particular has the widest global outreach among social networks and has already been offering money transfer and related mobile payment services in the US since last year. Now Facebook has announced plans to enhance digital transactions to pay for physical goods in stores.  Given the large number of Facebook users and the major network effect of remote family members, not only could Facebook be a major player in mobile payments but, more importantly, mobile-enable cross border remittances.

Mark Zuckerberg recently shared that Facebook would “partner with everyone who does payments.”  In addition, Forbes reported that Facebook was working with multiple businesses including Uber to facilitate payments. While the slow uptake in a market like the US, which already has multiple competing payment platforms is understandable, the real demand would be in developing markets, especially those with the largest number of active Facebook users such as the Brazil, India, Indonesia, Mexico, Turkey and the Philippines.  Even though many of these markets have various alternatives to making payments, a Messenger wallet that allows people to send money and pay for goods not only from linked bank accounts but also prepaid and e-money accounts could dramatically increase financial inclusion especially in counties like Indonesia and the Philippines.

It is also clear that Facebook isn’t planning to directly make money by taking a cut from mobile payment transactions made through Messenger, but rather provide a better value proposition to increase usage of Messenger and increase revenue via its advertising business.

As mentioned, in countries with large international remittances including India, Mexico and the Philippines, a Facebook facilitated cross border remittance service that is free and would only require small currency exchange fees could completely disrupt the entire remittance industry and would rapidly achieve the goals of the G20’s Global Partnership for Financial Inclusion to bring down the costs of remittances below 5%.

In a more recent article Forbes noted that the success of Facebook’s bigger payments play on Messenger will come down to execution. While Facebook takes a page out of the success behind WeChat’s  mobile payments service in China it will not only have to take into account the differences between markets but will also need to incorporate linkages to bank and non-bank financial providers that offer simple transactional accounts like e-money, mobile money and prepaid debit cards. In markets that are challenged with complicated or limited interbank funds transfers, Facebook could dramatically ease interoperability not only between those with bank accounts but also those with non-bank e-money or mobile money accounts.  Facebook will also need to ensure security and trust, however, this should be achievable via Facebook’s two factor authentication.

With the upcoming E-Payment Summit in the Philippines May 17-18, 2016, many will look forward to Facebook’s  Sandhya Devanathan remarks about plans for Messenger and mobile payments in South East Asia.

My prediction is that Facebook could be the game changer for not only mobile payments in the developing world but also remittances.  Facebook will definitely be the new mobile payment player to watch this year.

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