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E-Wallets: Game of giants

Thursday, March 31st, 2016

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By 2019, eMarketer estimates that the total value of transactions made by tapping a phone on an in-store terminal will reach $210 billion, up from $8.7 billion in 2015. For banks and retailers, that presents an opportunity to take on Apple Pay and Google’s Android Pay – and maybe save on transaction fees to boot.

Read our full research “Money of the Future”. Download PDF (20MB)The mobile-payment field is getting crowded despite slow consumer adoption. About 1 percent of U.S. households making at least $75,000 a year were expected to do their holiday shopping using a mobile wallet, according to Bankrate’s Money Pulse survey.

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Apple Pay was launched last year, with lots of fanfare and support by the credit card industry. Partnering with the banks that issue credit cards overcame the resistance that early entrants in mobile payments had faced. It also solved critical technology and infrastructure problems and offered the credit card industry a new avenue for growth.

Apple Pay isn’t a household name yet, but it is growing steadily and is likely to become one. Most recently, Apple announced a deal with China’s UnionPay, the state-run sole issuer of bankcards, to allow it to operate nationwide in the People’s Republic.

China became the fifth country to support the contactless payment service. It’s currently live in the US, the UK, Canada, and Australia, but the company said it plans to bring it to Hong Kong, Spain, and Singapore soon. With UnionPay, Apple has a powerful partner — the association is responsible for clearing China’s bank card payments — but Apple Pay may face stiff competition from established mobile payment services, including Tencent’s WeChat, and Alibaba’s AliPay.

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Apple Pay is, however, a Trojan horse.  Once Apple has established its platform, it won’t need the banks and credit cards any more. It will be able take advantage of another new technology, the blockchain, to offer an alternative payment option.  Blockchain is the core technology behind Bitcoin, and functions as a transparent ledger of transactions, concurrently hosted on numerous computers around the world — allowing the creation of digital currencies and virtual banks.

To be clear, Apple’s payment application has not taken off yet and works only on the latest model of its smartphones. According to data from payments-industry tracker, as of October 2015, only 15 percent of all iPhone 6/6s users had tried Apple Pay. That is an increase from 9 percent in November 2014, but is hardly enough to set the world on fire.  More significantly, only 5.1 percent of all Apple Pay eligible transactions (meaning, in which the store has an Apple Pay terminal and the shopper has an iPhone 6/6s) are running through the service. Because iPhone 6/6s models remain a small proportion of all iPhones in use, Apple Pay is capturing only a tiny volume of transactions.

But Apple has time on its side. And you can bet that Apple understands that the prize in play for global mobile payments is a larger market than that for phones, music, and computers combined. In classic Apple fashion, it is positioning itself to be a disruptive broker.

Apple’s advantages are that the iPhone has a cult-like following.  And every time users buy a new phone or upgrade to a new version of iOS, Apple has a chance to convince them to try Apple Pay.

Let’s just take it as a given that Apple Pay achieves significant market penetration. What then? Another upstart payments company, Square, gives us a flavor of what is possible when technology companies control the payments infrastructure. Square is now offering loans to its merchants without the merchants even requesting it. What’s more, it is basing the loan offering on the transaction volume it sees the merchant processing. And Square is taking repayment directly out of the transaction stream. Apple could easily do something like this, either for consumers or for merchants. With data and coverage come insights and smarter ways to do business (for example, send you targeted ads based on your credit limit).

Evidence that Apple wants to combine payments and iMessage is piling up. And it looks like the tech giant doesn’t plan to stop there. A patent filing published in December 2015 indicates that Apple is not only looking at allowing people to send money over its text messaging service, but other services built into the iOS platform, including phone calls, email, and calendar invites. Companies like Apple file patents that go unused all the time, but the application shows that Apple is paying attention to a key trend in the technology industry: the convergence of messaging and payments.

The patent hints at how the functionality may work. The image shows two iPhone users chatting in the iMessage app, with a payment option popping up in the top-right corner when one party asks the other to pay them back for lunch. The images also show the ability to send payments to more than one recipient, and an option to set how much money is sent. Other major tech firms are looking to integrate payment features inside messaging apps. Facebook Messenger added the ability for users to pay their friends earlier this year, and recently added the ability to order a ride from Uber within the app. This kind of functionality is already common in Asia, where apps like WeChat—which has 650 million monthly users—let users buy food, order taxis, pay bills, check bank statements, and more.

A Sept. 2015 report from Javelin Strategy & Research, a financial services firm, found that peer-to-peer payments are especially popular with two key age groups in the US: 18-24 year olds, and 25-34 year olds. The goal will be to get these young people to use Apple Pay in stores, where Apple reportedly gets a slight cut of each transaction, and make iPhones even more integral in their daily lives.

An upcoming iPhone feature, which will let users send money to friends, is expected to be an unprofitable way to boost adoption of Apple Pay Silicon Valley is obsessed with a particular part of the finance business that involves sending cash to friends using an app. That’s led to a flurry of options that often aren’t profitable because they charge little to no transaction fees. PayPal and its subsidiary, Venmo, are among the most popular, though they face a growing list of competitors, including Google, Facebook, and Square.

The world’s most valuable technology company has been talking with banks about introducing its own feature to Apple Pay that will allow users to send money to friends. If Apple hopes to compete, it will also need to make its service free to use with debit cards. Apple isn’t likely to find a way to profit directly from the feature. Instead, the company will probably use it to increase adoption of Apple Pay in stores. The mobile tap-to-pay option hasn’t taken off as quickly as expected since it debuted about a year ago.

Owners of newer iPhone models used Apple Pay in 2.7 percent of Black Friday transactions at stores that support the feature, compared with 4.9 percent on the same day last year, according to data from tracking firm InfoScout.

Facebook introduced peer-to-peer payments through its Messenger service in March. Once a user adds a debit card to a Facebook account, the person can send money through the chat window. Google said it has allowed people to send money to each other via its Gmail service for a few years, but created an app called Google Wallet for people seeking a mobile option.

It allows users to send payments to each other via debit card through an emailed link. Square also allows peer-to-peer payments using debit cards to users who have created a “$cashtag” account with the service.

After a sluggish start in the U.S. since its debut more than a year ago, Apple Pay is ramping up in markets where people are more comfortable with so- called contactless payments. The service, which lets consumers pay in an app or by tapping their iPhone on store terminals, will be introduced next year not only in China, but also in Hong Kong, Singapore and Spain. Apple is counting on its brand recognition as it enters markets that are further along than the U.S. in all things mobile payments, particularly in advanced technologies needed to accept them in retail outlets. Still, it won’t be easy. The iPhone maker will compete with local banks and Internet companies that already offer the service — not to mention Samsung Electronics Co., the world’s leader in smartphones.

Adoption has been faster in the U.K., where Apple Pay was introduced in the summer. That’s partly because of agreements with merchants such as sandwich chain Pret A Manger and Twickenham Stadium that let customers use Apple Pay to ring up unlimited amounts in transactions. Also, Apple’s operating system, iOS, commands a strong market share, with 39.5 percent of smartphone sales in Great Britain in the three months ended in October, according to Kantar Worldpanel ComTech.

Apple Pay will be available to eligible American Express users in Hong Kong and Singapore next year, Apple said in October. Companies like Hong Kong Telecommunications and HSBC already let consumers in Hong Kong pay with mobile phones in stores. In Singapore, a consortium of mobile operators, banks and service providers has been working on enabling contactless payments in shops, restaurants and taxis for at least three years. But Apple is increasing its presence in the country, and recently announced it will open its first retail store in Singapore.

Google Wallet and Android Pay

In March 2015 at Mobile World Congress Google announced the launch of its wallet called Android Pay. Just imagine Apple Pay but customizable, open, free and completely white-label, that’s how Android Pay looks like. Confrontation of open and closed architecture principles, iOS vs Android – now and in the world of payment solutions.

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In September 2015 Google rolled out a big update to its Google Wallet app for iOS, which brings a few nifty new features and a welcome redesign. Users can now send peer-to-peer payments, or cash out directly to a debit card — though Google is removing support for loyalty cards, gift cards, and offers with this update. “Send money to anyone in the U.S. with an email address,” Google said of the new service. “It’s fast, easy, and free to send directly from your debit card, bank account, or Wallet Balance.” “When you receive money, you can quickly cash out to your bank account using your debit card, or spend it instantly with the Google Wallet Card,” the company added.

Other features that Google wants users to take advantage of include splitting expenses (i.e. at a meal or on a trip), managing the Wallet Card (accepted wherever debit MasterCard is and at ATMs), placing limits on spending, and setting up recurring transfers from your bank account.

This is the same functionality that has been in the old Google Wallet app and Gmail’s “Attach money” feature, now in a standalone app. Other than that, there’s a way to look at your past transfers and even a section for managing your “Google Wallet Card,” which Google initially released as a stop-gap for when NFC didn’t work.

There is no NFC or loyalty card functionality here anymore. Those features will all move to Android Pay once the app launches. And the new Google Wallet app does not actually replace the old Google Wallet app—the upcoming Wallet app is a brand-new app under the package name “” while the old Google Wallet—””—will eventually be upgraded into Android Pay. Today, you can have both apps installed on your device and have “Wallet” and “Wallet” sitting right next to each other in the app drawer.

This is all a little confusing, isn’t it? There are two money apps now. This new Google Wallet app means Android Pay won’t be the one-stop-shop for transferring money on Android the way Google Wallet was. Android Pay will handle tap-and-pay and online transactions, but apparently not sending money to friends. So if you want to send money to a store, that’s Android Pay. Sending money to a website? That’s Android Pay, too. Sending money to a friend? That’s this other app.

Google bought Softcard’s point-of-sale tech and made some international advances for its money transfer service. Also customers that use Android apps from Dunkin’ Donuts and Seamless, and merchants that build online stores through Shopify, will able to access Google Wallet to make and accept quick payments.


PayPal started trading on the Nasdaq at $41.46 per share. As an independently traded company, PayPal was already valued at roughly $50B. Compare that with eBay’s market cap of about $33.64B. It means, PayPal is now worth more than Netflix, eBay and Twitter.

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As PayPal rebuilt itself for a post-eBay future, it took a fresh look at the vital statistics it was monitoring for signs of trouble. “Over four months, we did a lot of analysis to figure out which are the most high-value signals,” Shivananda says. “Even though we run the science across all 350,000 signals a second, the high-value signals, we put up on the walls. Everything else goes on an alert mechanism.”

The company is also beginning to automate some aspects of addressing common problems, in instances where it was confident that applying the same fix in the same way to the same type of flaw will work every time. Already, PayPal has created bots that are capable of patching servers on the network which have out-of-date software.

“The future of the ecosystem is not visual indications,” says Shivananda. “It’s basically the science that runs says ‘This application is throwing more errors, please roll back.’ And after that, it’ll go ‘I know the signal. I know what to do. I’ll just do it.” No matter what sort of technology PayPal comes up with, the fact that it has 350,000 data points a second to consider means that it’s not going to run out of opportunities to make the service more robust any time soon. “That data has all the signals,” Shivananda says. “The question is, are we listening to it?”

PayPal has acquired Paydiant, payment technology provider for eWallets – both for individual businesses (Subway, Harris Teeter supermarkets), and for universal wallets (CurrentC, which is supposed to compete with Apple Pay). Terms of the deal were not being disclosed, but according to Re/code, it was a $280M deal. As far as 80% of PayPal’s transactions happen to be online acquiring (with the rest accounting for mobile acquiring), their acquisition of the eWallet technology and team is a big step towards the leadership in a new sphere.

PayPal’s instant checkout service called OneTouch was being extended to support all merchants using the e-commerce platform Bigcommerce, as well as on mobile devices – even in cases where the consumer doesn’t have the PayPal native application installed. The service, which allows customers to check out from an online merchant without having to enter their username and password, launched publicly last fall on mobile devices then expanded to the web in April 2015. UK and Canada became first foreign markets[.

Around the world, we’ve reportedly loaned each other a staggering $51 billion, according to a study conducted by PayPal. PayPal launched a new feature aimed at making it easier to remind each other about those unpaid debts without things getting weird. PayPal.Me is a new, more effortless way to request money via PayPal using a short, customizable URL. Need your coworkers to pay you back for the cab you all shared from the office that happy hour the other night? The link will then redirect to a simple mobile interface that lets them do exactly what the URL suggests.

Target, CurrentC, Chase and Wal-Mart seek to disrupt mobile payments business in 2016 too

Companies like JPMorgan Chase & Co. and Wal-Mart Stores Inc. are rolling out their own products just as mobile-payment apps are catching on. At stake is a fight over money and consumer data. Retailers loathe paying fees to accept credit cards in their stores and have long sought better data on what their customers buy, and when. Banks similarly dislike paying fees for Apple Pay transactions. Thus, financial institutions and retailers have incentive to push out their own mobile-payment services.

JPMorgan Chase plans to introduce its own mobile wallet in mid-2016. Mobile-banking apps are already used by more than half of U.S. smartphone owners with bank accounts, according to the latest Federal Reserve survey. Chase plans to pre-load cards for 94 million customer accounts “so the customer doesn’t have to do anything but accept the terms and conditions,” Gordon Smith, CEO of consumer and community banking at JPMorgan Chase, said in a keynote at the Money20/20 conference in October. Chase still wants its cards in all mobile wallets, and has decided to support Apple Pay, Samsung Pay and other competing services.

Retailers like Walmart and Target likely prefer proprietary in-house systems for two reasons: They can save on processing fees for credit card transactions, which stores would otherwise have to absorb, and they gain deeper insight into consumer behavior. But Target may face challenges in rolling out a mobile wallet, even if it’s just a matter of optics: A 2013 hack led to criminals obtaining the credit card numbers and personal information of tens of millions of Target customers. And the company found itself back in the news due to a security flaw in its mobile app. Target’s decision to launch its own payment app is also one more piece of bad news for CurrentC, an erstwhile Apple Pay and Android Pay rival backed by Walmart and Target, among others. CurrentC’s release date has been rolled back repeatedly as backers have opted to create their own proprietary products instead.

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Walmart will begin accepting payments through its mobile app in all U.S. stores in the first half of 2016. About 22 million Walmart shoppers already use the app, which compares prices and offers discounts on items and will now let customers store their credit- and debit-card information.

Walmart is launching its own proprietary mobile wallet app, Walmart Pay. The company’s iOS and Android apps will allow users to pay at Walmart checkouts with any smartphone, through which they can charge purchases to their personal credit or debit cards, pre-paid cards, a Walmart gift card, or a store credit card. It essentially combines a checkout payment system with app functionality, which allows customers to also locate items in-store or pick up items they have reserved.

Walmart launching its own app is essentially a vote of no confidence in CurrentC, which has big backers (Target, Kohl’s, Rite Aid), but has been plagued by delays, a data breach, and withering beta reviews from customers.

Merchant Customer Exchange – a consortium founded in August 2012 by merchants including Wal-Mart and Target Corp. – is testing its CurrentC app with about 200 merchants in Columbus, Ohio. The service is not yet available nationwide. “There will be more than one successful player in the mobile-payments space, and we fully expect to be one of them,” said Brian Mooney, chief executive officer of MCX.

CurrentC, the payments app being created by a consortium of big retailers known as MCX, will begin a public pilot of its app in Columbus, Ohio, and will not rush a wider rollout if the product is not ready. CurrentC — backed by several dozen big merchants including Walmart, Target, Kohl’s, Dunkin’ Donuts and Exxon — is designed to work on all types of smartphones and let shoppers pay with the app instead of a physical payment card or cash. But while Apple Pay and soon-to-launch services Android Pay and Samsung Pay let users pay using account information from traditional credit cards like Visa, MasterCard and Amex, CurrentC does not. Instead, CurrentC’s beta users can only pay using one of three options: Gift cards, a store’s private-label payment card or direct hookups with their checking accounts.


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Mainstream credit cards carry higher transaction fees than these options, which is a big reason why they aren’t currently part of the offering. For starters, there are not a ton of high-profile success stories in the tech world that are a result of joint ventures. One advantage they all have over CurrentC: They will be preloaded on millions of new phones over the next few years, while CurrentC will have to get people to download its app.

Best Buy was the first big-name U.S. retailer to break ranks with a Walmart-led Apple Pay competitor, announced that it will accept Apple’s digital payment system in its U.S. stores. Best Buy has also started accepting Apple Pay as a payment method in its apps. The partnership is a big one for Apple, because it’s the first with a member of MCX, a consortium of retailers and food chains that is building a payment app called CurrentC that is expected to be competitive with Apple Pay.

Microsoft is preparing to follow Apple and Google into mobile payments, lining up the regulatory approvals needed for the launch of a host card emulation-based service. In March 2015 the firm showed off the tap and pay mobile payments system for handsets running its new Windows 10 operating system at a conference in China. As well as support for Secure Element-based payments, it also taps HCE.

Amazon’s General Manager of Payments, Matt Swann, has left the company after the failure of Amazon Wallet. Amazon has deleted its Amazon Wallet application from Google Play store and Amazon app store. Reasons: poorly elaborated app and partly related to this low popularity of the wallet.


In July 2015 Ant Financial confirmed that it closed a Series A funding round which includes investment from China’s largest pension fund, the National Social Security Fund (NSSF). While it isn’t a traditional Series A — because most startup aren’t formed as an offshoot from a multi-billion e-commerce juggernaut — the deal is eye-watering. Ant Financial said the undisclosed round included capital from “major Chinese insurance corporations” and other investors.

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TechCrunch understands from sources close to Ant Financial that it values the company at $45-$50 billion. The investment from NSSF — which we hear included a substantial discount — brings on an interesting strategic investor. China’s government recently relaxed regulations on how the fund can invest, and this deal with Ant Financial is the first such investment that NSSF has undertaken since that loosening. It’s also a huge validation for the business, and could help Ant Financial with legal and regulatory hurdles in the future.

Alibaba had the largest IPO in history because the hugely popular retailer benefits almost anytime someone in China spends money online. So now it’s trying to pump even more money into China’s online economy, by introducing the country’s consumers to the tools of modern finance. At least that’s one way to look at Ant Financial. Run by Alibaba cofounder Lucy Peng, the division—which was spun off into its own company in 2011—began as an outgrowth of Alipay, the company’s version of PayPal.

Since then it has expanded into a full-scale financial services firm. It now includes a money-market fund, a peer-to-peer lending service, and a microloan program for online entrepreneurs. In February it announced a fund to seed Hong Kong–based startups that want to do business on Alibaba’s platform. And the company is developing Sesame, which will assign credit scores based on Alibaba customer data, thus potentially making it easier for millions of consumers to get loans—and, from there, to start small businesses, many of which will likely set up shop on Alibaba’s platform.

Alibaba’s relationship with the Chinese government has always been fraught, but the two entities share an interest in increasing the purchasing power of the Chinese populace. Indeed, China granted Alibaba one of five licenses to establish a private bank, part of an effort to establish critical financial infrastructure in the as-yet underserved country. (Alibaba rival Tencent received one as well.) Erik Gordon, a professor at University of Michigan’s Ross School of Business who has studied Alibaba, says that if the company can become the default bank for China’s working and middle class, its financial services business could dwarf its current ecommerce enterprise. “I wouldn’t be surprised if in 10 years Ant was the largest financial institution in the world,” Gordon says. “Nothing would surprise me less.”

McDonald’s teamed up with Ant Financial to start accepting mobile payments in more than 2,100 of its restaurants in China, using Alipay. McDonald’s Shanghai chains will be the first to integrate the new mobile payment option, with the countrywide rollout to be completed by March 2016. The fast-food chain is also looking to partner with Alipay on “data technologies” to learn more about its customers, businesses, and ecosystems — essentially to compile big data on Chinese consumers in order to really take its business in the country to the next level.

In June 2015 MYbank, a startup backed by Ant Financial Services Group, launched a digital-only bank to provide “inclusive and innovative financial solutions” at lower cost to under-banked urban and rural consumers and small and medium businesses. The startup does not have a physical presence and so it can serve customers 24X7. It begin setting up accounts and accepting deposits, its initial strategy is to concentrate on issuing small loans of less than RMB 5 million (US$805,500) for SMBs, entrepreneurs and consumers.


In September 2015 Alibaba has sharpened its focus on India after it made a second investment in Paytm, a mobile payments and e-commerce business. The investment was made by Alibaba and Ant Financial, the Chinese firm’s financial services affiliate, which made an undisclosed investment in Paytm in February 2015 via a deal that reportedly valued the Indian company at more than $1 billion.

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This new deal is also undisclosed; however India’s Economic Times reports that Alibaba is spending $680 million to buy 20 percent of Paytm. That lowers Ant Financial’s stake from 25 percent to 20 percent, the report added. So, in essence, Alibaba is now making a firmer commitment having tested the water via the Ant Financial deal.

Paytm, which grew and was spun out of mobile content company One97, bears much similarity to Alibaba’s own constellation of businesses, albeit that it is far less developed. It offers a range of financial-focused services in India, including a mobile wallet app (used by Uber, among others), online recharge (for topping up phone credit and more), and a shopping service.

The company said it has been working on “synergies” with Alibaba since taking funding in February, and its e-commerce marketplace is a particular area of focus given that Alibaba practically pioneered the genre in China with its Taobao site.

Paytm claims more than 100 million users of its wallet service, which helps Indians buy items online without the need for a credit/debit card or banking. The startup said the Paytm Wallet clocks more than 75 million transactions each month. Vijay Shekhar Sharma, founder and CEO of Paytm said the company is looking “to bring half a billion Indians to the mainstream economy and help millions of small businesses leverage this large m-commerce opportunity.”

“India is an important emerging market with strong e-commerce potential, and we look forward to partnering with Paytm to deliver innovative products and services to consumers… This investment will further expand Alibaba Group’s global footprint to India’s thriving mobile commerce market,” Alibaba CEO Daniel Zhang said in a statement.

Samsung Pay

In February 2015 Samsung acquired m-wallet LoopPay, mentioned in our previous annual research. It’s going to compete with Apple Pay, and the LoopPay’s payment solution compatible with merchants’ equipment installed to accept card payments (which makes 90% coverage in comparison with less than 10% for NFC-based wallets like ApplePay), will be helpful for the world’s largest smartphone manufacturer. According to Samsung representatives, it’s the company’s first step to building a full-fledged financial infrastructure on the basis of the Samsung Pay.

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Samsung begun rolling out its answer to Apple Pay in Korea in July 2015. The service was called Samsung Pay and it is powered by LoopPay, the Boston-based company. It’s due to launch in Korea and the U.S. first before expanding worldwide, but Samsung has nudged it into action with a pre-launch pilot program among Galaxy S6 and S6 Edge owners in its home country. They seem nearly identical, but Samsung Pay has a couple if differences compared to Apple Pay.

Life.SREDA VC is a global fintech-focused Venture Capital fund with HQ in Singapore


Retail Gift Card Association Announces New Leadership

Thursday, March 31st, 2016

Gift Card Trade Group Appoints New Officers, Directors and Committee Chairs


The Retail Gift Card Association (RGCA), a trade association of diverse, closed loop gift card industry professionals committed to promoting and protecting the use of gift cards, announced today the election of five new individuals to the Board of Directors and the appointment of two current Board members to Executive level positions.

Tim Anderson of AMC Theatres, Lauren Haus of TJX Incentive Sales, Marina Hodges of Walmart, Jenny Jeansonne of eBay, and Mike Strohl of Sears will assume their Director positions on March 20, 2016 during the RGCA’s Spring Member Meeting held at the All Payments Expo in New Orleans, LA. Erin Wood of SUBWAY will assume the Executive position as Treasurer and Colleen Dorwart of Cabela’s will serve as Vice Chair for the 2016-2017 term.

The newly elected leaders will work with the current Board to advocate on behalf of retail gift cards to drive success and growth of the continuously evolving industry. The RGCA is made-up of more than 70 of the world’s most-recognizable retail brands and has been the leading gift card advocacy group since its inception in 2008. RGCA’s new leadership will work to capitalize on the recent announcement of the organization’s membership expansion to non-retail industry partners.

“There has never been a more exciting time to be involved with RGCA,” said Mike Pennington, Executive Director of the RGCA. “Our new class of leaders are very well-established in the industry and will help us to grow our association, becoming an even-stronger voice for closed-loop gift cards.”

For more information on the RGCA, or to become a member:

How the Canadians are beating back fraud: An American’s take

Thursday, March 31st, 2016

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Posted by Seth Ruden to Payments Risk Management


Greetings, Canadians from your friends down south. While I am an American by passport, I am longing to be a Canadian in spirit, finding things like Poutine, Hockey and Cream Ale far better beyond the border. 

Perhaps after this election cycle, I might find myself enjoying them more frequently.  While this is all tongue in cheek, and illustrates that we may have more in common than we let on, there are some things that I think Canadians are doing better than their counterparts, including the USA, and one such thing is Fraud Management.  

Let’s count the ways: 

Interac, the Canadian Debit Card network, recently published a report that suggested that their losses are down to a six-year low, below my own internal benchmarked global average. Further, when measured inside Canada, the fraud rate on debit cards is far below the global average for mature EMV (Chip Card) issuing countries. 

This is mostly due to efforts by Interac to educate and migrate (to EMV terminals) as well as offer fraud mitigation services and tools. They are creating a culture of security and reliability that is unparalleled in the Americas and perhaps globally. This is no small feat for a developed country, and their record low debit fraud losses are the evidence for this achievement.   

In the USA, we share an International Fraud Awareness Week with the rest of the globe. In Canada there is a whole month devoted to getting the word out. 125 private sector firms that are members in the forum distribute a wealth of knowledge and best practices to consumers and businesses. 

This vehicle is driven by the Canadian Competition Bureau, a federal law enforcement agency with oversight into consumer protection and compliance with anti-trust requirements. 

It trended for me on twitter,… yep, it’s a thing, and the banks get in on it, and so does law enforcement, and private industry, the central bank, and… you get it, it’s real and it’s actionable and it works. 

Canada has an “Anti-Fraud Centre” (see what I did there?), a resource for consumers, functioning as a call center and centralized data repository to protect the population from scams, identity theft and other deceptive practices. 

These and other similar groups are available to educate citizens in ways that the frauders are active, and protect the population from potential exposure as a public service. 

Campaigns are deployed against the fraud that is typically found in Canada, among various Social Engineering schemes: Romance scams, “401” or advance-fees scams, money mules/work from home scams, re-shipping among other approaches that are used to fleece unsuspecting victims. 

It occurs to me that this culture of sharing the counter-intelligence, of proactively deploying the right hard and soft controls in the relevant spaces, has manifested greater security in the land of the maple leaf. 

This model of encouraging education and finding ways to disseminate knowledge, of aggregating intelligence and collaborating as a greater community to share strategies and effective tactics, has resulted in success. This is a model of greatness, where convenience and security share the stage and there is a reset of consumer behavior to increase the well-being of everyone in the financial community.  

Last point… There are a few thought models of fraud management that I encounter;  

  1. That if an entity can resolve its fraud problems better than its peers, it has a competitive advantage. 
  2. That if an entity can empower everyone in its sphere of influence to reduce the collective fraud problems, all stakeholders benefit. 

Said another way, I think the Canadian model is the following: Is it better to reduce our slice of the fraud pie, or can we make the whole pie smaller, and then starve the fraudsters out? I love that idea, that we can evangelize this culture in a global community of fraud fighters, and that’s why I continue to find it so warm in the great white north! #FPM2016!  

And speaking of Canada, I’ll be presenting on this topic at the Interac Risk and Cybercrime Conference 2016 in Vancouver…hope to see you in April.

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The 11 Best Collaboration Tools (That You’re Not Already Using)

Thursday, March 31st, 2016

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– Aja Frost

Collaboration is the lifeblood of every startup. Whether you’re logging onto Skype each day to talk to your remote team or piling into a conference room to catch up with your staff, there’s no way you’d be successful if that magical exchange of ideas, advice, inspiration, and guidance didn’t take place.

And, of course, the right tools will make your collaboration even more effective. We’re sharing our 11 favorite collaboration tools that you’re not already using—because, well, we know you’ve heard of Slack.

1. Quip

Does your team use one app to work on shared spreadsheets, another for notes, another for checklists, and yet another for regular docs? If so, check out Quip.

Quip keeps all your files in one place, so you never have to remember who saved what and where. You can also stop relying on email chains: there’s a chat thread within every document, so you can make decisions without leaving the app. And to make things a little more fun, Quip offers emojis and memes.

Owen Thomas, the editor-in-chief of ReadWrite, says, “Because Quip has a great app that’s usable on virtually every platform, they don’t have any merging issues.”

2. Zeplin

Designers and developers have been warring for as long as, well, there’ve been products to design and develop! But now, with the introduction of Zeplin, they can finally lay down their weapons.

Here’s how this collaboration tool works: first, UI designers upload their designs and instantly turn them into specs and guidelines. Then, front-end developers can log in, examine the assets layer by layer and export code snippets.

“Zeplin is the ultimate collaboration tool between designers and developers,” says design+code creator Meng To. “It cuts meetings in half and ensures that designs are implemented perfectly, however complex.”

3. Hackpad

If you work at a startup, you’re probably familiar with information overload. It crops up when you’ve got tons of people creating and sharing new data all the time—flooding your brain with more than it could ever compute.

Hackpad is the answer, according to The Muse CEO Kathryn Minshew. She explains, “We have started using Hackpad for documentation, and it works well for internal knowledge management.”

Although on the surface, Hackpad looks like Google Docs, it distinguishes itself by offering media embeds, better version tracking, and a handy Dropbox integration.

Give it a try, and stop drowning in information.

4. WeTransfer

You’re working with a client, and you need to send her a huge file. But you don’t want to make her a user on your platform—and you also don’t want to spend precious time transferring the file to a new platform. What do you do?

Well, you could use WeTransfer. This app lets you send large files instantly, without setting up an account. (That’s why Jurnid founder Andrew Quarrie likes it.) However, if you do make an account, you can create branded views for people to see when they download your files.

“It’s nice visual icing on the cake,” says Helen Todd, co-founder and CEO of Sociality Squared.

5. Flowdock

With Flowdock, a team chat tool, you can collaborate in both public discussions and one-on-one-messages. Which, yes, probably sounds familiar. “It’s essentially like Slack,” explains AdStage CEO and co-founder Sahil Jain.

But there’s one major difference, Jain says. “We like Flowdock’s inline threads, which Slack doesn’t have. It’s an extremely valuable feature.” Inline threads let you start sub-conversations within larger ones. Imagine your entire team is discussing when your next hack day should be, and your boss writes, “Let’s do the end of the month, since we’ll have just wrapped up our sprint.” You can respond directly to your boss with a comment that’s really only relevant to you two—if other people want to read your thread, they can, but their feed won’t be clogged up by your discussion.

Flowdock is still flying under the radar, but we definitely recommend checking it out!

6. Active Collab

Choosing a project management app is tough. You’ve got a ton of choices, and they each seem a little different. Well, if you’re stuck between Asana and a hard place, we’ve got a third suggestion: Active Collab. This tool provides task management, collaboration, time-tracking, reporting, and invoicing features, so you can centralize most (if not all) of your work.

Plus, it’s dynamic. If you’re drawn to Trello’s board set-up, then turn on Active Collab’s Kanban view of your projects. Do you like Asana’s dashboard? Active Collab’s inbox feels very similar. Maybe you’re a fan of Jira’s Gantt charts—Active Collab offers those, too.

7. Leankit

Like Active Collab, LeanKit helps you visualize your project status and task breakdown. But Leankit does so in a completely different way.

Each project is sliced and diced into columns and rows. Your tasks are represented by little squares and can be dragged from column to column to indicate their relative progression. Rows show parallel processes, which is helpful when you’ve got two or more people working on similar tasks (for example, three team members each fixing separate code bugs, or two freelancers each creating graphics for your web site.)

As you can tell by the name, Leankit is designed for lean teams. That’s why Andrew Kemendo, founder and CEO of Visidraft, likes it. “Between myself and our CTO, we develop things that need to be done and assign them to either ourselves or individual contractors,” he adds. Small, scrappy startups: Go check out Leankit. You heard it here first!

8. RealtimeBoard

Whiteboards are wonderful for letting you visually sketch out your ideas, progress, and plans—but they have a couple weaknesses. Not only are they temporary, but they only display the latest version of your work. Plus, you can’t use a whiteboard with any client, coworker, or consultant who’s not actually with you.

By digitizing the whiteboard, RealtimeBoard has solved all of those issues. Use its flexible blank canvases to create anything you’d like—from user story maps and timelines to mood boards and project workflows. Each canvas updates in real time, so you can collaborate with whomever you’d like.

9. Roadmunk

Product teams can plan and collaborate better with Roadmunk, which lets you create elegant, readable roadmaps.

And, with multiple ways to share your roadmaps, collaborating and gathering feedback is painless. Send your roadmaps in “reviewer mode” to clients to get their comments (without letting them make changes), publish them as password-protected webpages, or export them to PowerPoint. Like with Google Docs, you can delegate individual team members as viewers, editors, or owners.

Roadmunk even lets you create multiple roadmaps from the same data set. With this feature, you can show different versions of your project to different stakeholders (investors, customers, advisors, colleagues, etc.).

One last feature worth mentioning: the app integrates with Jira, so you can easily bring in your issue data.

10. Breather

Remember the days when meetings only took place face-to-face? We love remote collaboration just as much as the next startup, but sometimes, it’s really great to be in the same room as the people you’re working with.

Enter: Breather.

“You can use Breather to rent conference rooms by the hour,” says Brian Frumberg, founder of VentureOut. “It’s really awesome.”

Each Breather space is designed to be comfortable, quiet, and private, so your team can get down to business without worrying about being overheard or fighting to be heard. Can you say that about a coffee shop or your open office?

11. InVision

You might be wondering if InVision, a project management tool for design collaboration, really belongs on this list. After all, as Kinnek co-founder Karthik Sridharan says, “A lot of designers swear by InVision.”

It’s true this app has left its days of relative anonymity behind. However, we’re including it for the features you might not know about, like Workflow 2.0 and Boards.

Let’s start with the new Workflow. Now, along with viewing and organizing each project’s screens, you can assign specific screens to individual collaborators. Gone are the days of, “Wait, that was my job?” In addition, there’s now an “activity tab” that shows what’s changed on a project since you last checked.

Boards, InVision’s second recently updated feature, lets you copy your boards, work with your team mates in real time, and zoom out to get a bird’s-eye view of what you’re creating.

The power of integrating loyalty into digital wallets

Thursday, March 31st, 2016

CMA logo

By Jeff Berry

Apple Pay’s November arrival in Canada has rekindled conversations around mobile wallets. However, this leg of the digital revolution is by no means a sure thing as evidenced by the fact that adoption is still lagging a full five years since Google first announced its venture into the space.

One study by Gallup in 2015 found that only 13% of smartphone users actually had digital wallets, while more than three quarters of those who did, rarely used it. Lack of awareness continues to be a barrier to mass adoption, but it’s coupled with concerns over security, lack of availability and a lack of utility. Putting consumers at the heart of the digital wallet will go a long way to alleviate these issues.

So what now? While trust in security remains a big issue with digital wallet adoption, if consumers trust a brand, they’re more likely to engage with the mobile payment app and adopt the platform. Banks, in this regard are well-poised to capitalize on the trend as they’re already well-trusted brands in consumers’ views. Beyond maintaining that trust, banks with mobile wallets (and their merchant partners), need to build adoption through a system that rewards their customers for that loyalty. Back in 2011, BMO became the first Canadian bank to introduce BMO Mobile Paypass, a technology to allow BMO personal credit card customers to make purchases through a sticker placed on their mobile devices.

Yet, herein lies one of the biggest opportunities for mobile wallets: to date, they’ve largely been a way to facilitate payments, and don’t take into account the other cards that take up space in consumer wallets – namely loyalty cards.

If the benefit of digital wallets was re-imagined to more broadly help ease common pain points across the full shopping experience, as opposed to merely the payment stage, brands that integrated their loyalty programs with digital payment capabilities would undoubtedly improve adoption – moving beyond the concept of the digital wallet into the arguably bigger opportunity, digital loyalty.

The demand is here: with seemingly busier lives than ever before, naturally consumers will tend to gravitate towards an easier and effortless way of living.

The marriage would create a system of convenience for customers, cutting out the cumbersome stage of fumbling through a wallet in search of the right payment or loyalty cards. (And considering Canadians subscribe to an average of eight programs each, it would certainly simplify things.) It also creates more opportunity for merchants to get more reliable data from loyalty programs to help enhance their programs (no more forgotten cards when they are all on your phone).

With growing consumer expectations, being able to offer the convenience factor is more important than ever. So, although the name “mobile wallet” suggests that payments are the driver, the true value of the mobile wallet is its potential to completely change the shopping experience, and to enrich relationships between retailers and customers.

More importantly, using the rich loyalty customer analytics and transactional data, retailers and brands can create an ultra-personalized experience, enticing shoppers with custom discounts and offers. Digital has created a world where customization is commonplace. While retailers have long tried to create that personalized approach to direct marketing on digital channels, mobile wallets make it possible to capture shoppers at the right moment in time (in the aisles, as they enter the store, at checkout) with the right message (a deal, just for you!), all of this creates another opportunity in the bigger Omni-channel marketing mix.

Introducing Tangerine’s Money-Back Credit Card

Thursday, March 31st, 2016


Finally, a Credit Card that earns its keep.

Ordinary credit cards make it easy for you to spend money. But with the Tangerine Money-Back Credit Card, it’s also easy for you to save money with every swipe.   Tangering card

Every purchase you make earns you Money-Back Rewards that you can have redeemed directly back onto your Credit Card or into a Tangerine Savings Account, each month automatically. You get 2% Money-Back Rewards on your purchases in select 2% Money-Back Categories, and 1% Money-Back Rewards on all other purchases.

Plus, there’s no annual fee, so you’re not paying a price to earn money back.

Now, earn 4% Money-Back Rewards for the first 3 months in your chosen categories.

Apply for the Tangerine Money-Back Credit Card by June 27, 2016, and purchases you make in your chosen 2% Money-Back Categories will earn 4% Money-Back Rewards instead for the first 3 months. You’ll continue to earn 1% Money-Back Rewards on all your other purchases. 4% Money-Back Rewards start the day you activate your Credit Card, and then go back to 2% after 3 months*.

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Stuff the Tangerine™ Lawyers Make Us Say:
The ‘Tangerine’ trademarks are owned by The Bank of Nova Scotia and used under licence. Forward Banking is a registered trademark of Tangerine Bank.

® / ™ MasterCard and the MasterCard Brand Mark are registered trademarks, and tap & go is a trademark of MasterCard International Incorporated.

* This Promotion is available only to new Tangerine Money-Back Credit Card Accountholders who apply for the Credit Card between 12:01 a.m. ET on March 29, 2016 and 11:59 pm ET on June 27, 2016. To be eligible, new Credit Cards must be activated no more than 30 calendar days from the date Tangerine approves the application. During the Promotion, 2% Money-Back Categories will earn 4% money back for the 93-day period beginning on the date the Tangerine Money-Back Credit Card is activated. The Promotional rate of 4% money back does not apply to Cash Advances or Balance Transfers. All other Terms and Conditions for the Tangerine Money-Back Credit Card and the Money-Back Rewards program remain unchanged. If the chosen 2% Money-Back Categories are changed at any time while this Promotion is in effect, the 4% Promotional rate will be automatically transferred to the new chosen categories. Tangerine reserves the right to cancel the Promotion or change the terms of this Promotion at any time and for any reason, without notice to you. In keeping with the general Terms and Conditions of the Money-Back Rewards program, Accounts must be in Good Standing in order to receive Money-Back Rewards.

Will your business be the next victim of digital Darwinism?

Thursday, March 31st, 2016


Speaking at MaRS Verge this month, I was struck by the lasting significance of a story told by fellow panelist Alfredo Tan, a marketing director at Facebook. He reminded us how an employee at a well-known camera manufacturer had invented the digital camera in 1975, only for the patent to be kept quiet to preserve the company’s market share in film. That company did go on to make a lot of money off the digital camera patent, but it expired in 2007. Tellingly, the company filed for bankruptcy in 2012, having embraced digital far too late.

The story serves as a warning for every company that doesn’t have digital innovation front of mind, or is persisting in efforts to resist and fight against the digitization of our entire economy. It will be those companies that cease to exist. At the other end of the scale, the businesses leading the charge in digital adoption are now capturing 77% of industry profits. Their market valuation is skyrocketing and their value creation to shareholders is growing exponentially. Clearly, the risk is in not embracing the digital economy, rather than moving to invest in it now.

With that in mind, why has new IDC Canada research told us that only 17% of Canadian businesses have plans to embrace the digital economy? This is perhaps not so shocking given that big Canadian companies tend to be conservative, but it is very telling in terms of the magnitude of the issue at hand. So, in the hope of inspiring digital adoption in more Canadian businesses, I want to touch on the five inter-related areas of focus that make innovation and embracing the digital economy actionable:

  • Revolutionizing the Core. The systems that run businesses today are often latent. They tell us what has happened, not what will happen. With today’s technology it’s possible for the core to run in real time – to be ‘alive’ – allowing an organization to go beyond running more efficiently to reinventing how it runs.
  • Igniting the Workforce. In 2016 every business should have a plan to digitally maximize its best asset – its people. At MaRS Verge, 3M chief design officer Eric Quint said: “‘Create value for people, by valuing people”. This encapsulates the benefit of not creating foregone conclusions, but instead putting problems to teams for greater potential innovation. Also, bear in mind the power of a collision of ideas – interdisciplinary practices will be even more vital in the digital future of work.
  • Inverting the relationship with the customer. It is possible today, through the live core I mentioned above, for an organization to connect and collaborate with customers in real time, predicting their needs, not responding to them.
  • Collaborating beyond the walls of the enterprise. Doing this can bring game-changing efficiencies. Imagine a world where a supplier informs the supply chain, or even where competing organizations can connect to procure the same goods using the benefit of scale.
  • Digitizing assets of the business. Physical assets and digital assets need not be two different things. As an example, a construction company’s physical assets – trucks, cranes, and lifts – actually predicate its ability to deliver projects. Converting these physical assets to digital assets means downtime can be avoided and projects can be delivered on time and on budget.

These five points are of course only the tip of a very large iceberg when it comes to building and acting on a digital innovation strategy. In the spirit of MaRS Verge, I’ll leave you for now with a comment from MaRS director Charles Finley: “The quality of our future will be designed by our ability to innovate and lead change, rather than simply respond to it.”

MasterCard pushes biometrics into e-commerce payments

Thursday, March 24th, 2016


by Ben Rabinovich

MasterCard and BMO Financial Group (BMO) have begun a phased launch of the first biometric corporate credit card programme in Canada and the US that will allow cardholders to authorise transactions using biometrics when making online purchases.

Called MasterCard Identity Check, the smartphone app will allow participants to scan fingerprints or snap selfies to validate their identities; and when verified, return to the merchant site to complete the online purchase.

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“The use of biometric technology has become more common for consumers looking for convenient and secure ways to make purchases using their smartphones, so this was the natural next step for us as innovators in the payment security space,” said Steve Pedersen, Vice President, Head, North American Corporate Card Products, BMO Financial Group.

He also revealed that the first phase will involve the technology being trialled using BMO employee corporate cardholders in the US and Canada, to identify and improve best practices in corporate environments.

Once they have been identified, the tech will be rolled out more broadly to consumers this summer.

“With BMO, MasterCard is hosting our first Canadian and U.S. corporate card biometric user engagement. It’s always exciting to introduce biometrics to new cardholders. They quickly realize that they don’t have to sacrifice convenience for security. By snapping a selfie or scanning a fingerprint, the person becomes the password,” said Catherine Murchie, senior vice president of North America Processing, Enterprise Security & Network Solutions for MasterCard.


What is the future of fintech? (Infographic)

Thursday, March 24th, 2016


Oh, what we wouldn’t do to know the future! Like Biff and the Almanac in Back to the Future, all we need is a guide. Luckily the team over at Pivotl is on hand to give us one for the future of fintech.

Be it money transfers, health insurance, bitcoin or entirely new banks, the fintech space is enticing investors across more and more verticals.

What’s more impressive is just how much the level of investment continues to grow. Last year saw more than $7.2bn raised globally by fintech companies, up 71% from 2014 and, as their latest infographic explores, it doesn’t look like slowing down as we head into 2016.

It’s not yet the end of the first quarter, but already investment is up nearly three quarters on Q3 2015. Check out this latest infographic to see how this fast-moving industry continues to evolve.


Interview: Lendstar is bringing payments to Facebook and Whatsapp

Thursday, March 24th, 2016


Given how much time we all spend on social media, it’s surprising that the idea of merging payments with the likes of Twitter, Facebook and Whatsapp is not the biggest trend right now.

That’s not to say that these social media giants are oblivious – quite the opposite. For example, Facebook users in the US can send and receive money over Facebook messenger and the service has been running since July 2015. In the US again (they are so lucky!) Snapchat users can send money using Snapcash. All you need is a Visa or MasterCard debit card. Even troubled company Blackberry, is trying to reposition itself as a fintech service by integrating PayPal payments into its messaging service, BBM. The company has even taken this payment capability to Britain, partnering with Barclays Pingit service.

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But despite all these social media giants (and Blackberry) implementing payments features, the buzz feels more like a slow-boil at the moment, with the majority of people being mainly preoccupied by contactless cards and mobile payments.

However, just because it’s not currently stratospheric and shiny enough to distract everyone, doesn’t mean companies can’t plan ahead or make inroads. Lendstar, the app that allows people to collect money, divide bills and pay directly into groups or send money to friends, has released a new update that features a special payment link that can be shared on Facebook and Whatsapp. This link allows people to pay you back without even accessing the Lendstar app.

So if someone has organised a trip to Barcelona and wants to collect money from everyone going, they can create a group on Whatsapp and post the payment link on it. Now everyone can transfer money with just a few clicks from their bank account. The invited friends must authenticate with their mobile phone number and online banking login, which are not stored by Lendstar.

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We spoke to the Christopher Kampshoff, the CEO and founder of Lendstar, to learn more about why they are focussing on social media and what is in store for the rest of the year.

What was the thinking behind bringing payments into social media?

The idea of Lendstar is to make payments as simple and easy as possible, but also to add the communication, which comes with every payment (think about your mum wishing you a great birthday while sending you money – she did this before online-banking was used by putting money and a letter into an envelope). That’s why we like to call Lendstar a social financial network (which links your IBAN to your phone number). The next logical step of this vision is the PayLink, which allows you to spread your payment requests as easy as a chat message on all social media channels you like to use. From now on its all about getting paid with just a personalized link (you can still use your phone number). We also offer a group link, which enables users to collect money along their friends for a birthday present (e.g. on WhatsApp) or from a broad audience for donations (e.g. on Twitter/Facebook).

How important do you think social media will be for payments in 5 years’ time?

Payments happen where people are and where they interact. As social media is exactly doing this, bringing people together and make it easy for them to interact, it is therefore clear that payment and social interaction belong together. This can happen in classical social media channels but also in specialised apps such as Lendstar. We allow people also to easily create group transactions and interact with chats and pictures via our app. With the paylink we are now connecting both worlds, hence people can use our service even without the need of our app.

I think that in general the idea of mobile P2P transaction is still in a very early stage and the market needs to be educated more on this. This will then for sure increase volumes and adoption.

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There’s been a rise in voice-activated and hands-free payments, is that something you are interested in?

Everything that makes payments as intuitive and easy to use as possible for the end-user is great. Still security is also something we always should have in mind. Finally not everything that is technically possible is also attractive for the end-user. To find the right balance is for sure one of the main challenges of every start-up.

What’s in store for Lendstar in 2016?

2016 will be a great year for us. We will start with many new and exciting features. The paylink was just the first big thing. We will also increase the number of bank partners significantly. Europe-wide internationalisation is also on the agenda for 2016. So lots of to dos, but we live in exciting times and this is what drives us.

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