Month: March 2017

8 AM, Friday morning – Bitcoin investors waited with anticipation to hear the SEC’s decision of the first Bitcoin ETF, which would be known as the Winklevoss Bitcoin Trust. It seemed many were confident that the SEC would approve of the exchange-traded fund, as the price of a Bitcoin reached $1,325. If approved, Bitcoins could be bought and sold on the open stock market and push the price even higher. Investors were then told that, no, the SEC would not approve of the Bitcoin ETF, and the Bitcoin price slumped to $980.

The SEC defended their decision by stating that Bitcoin trading could be subject to “fraudulent or manipulative acts and practices.” This is not entirely without merit – in 2014, the Mt. Gox Bitcoin exchange was hacked and dropped the value of Bitcoin so much that it has taken three years to recover. With reports of massive cyberattacks on the rise, the SEC decided that it was simply too risky for a purely digital currency to be put on the stock market.

Additionally, there is some skepticism surrounding whether the Bitcoin ETF would have even been successful. The Winklevoss brothers have an index tracking the price of Bitcoin called WinkDex, that averages “the price of Bitcoin across multiple exchanges,” and provides an approximation of how the Bitcoin ETF would have performed. However, over the years, the performance of WinkDex has been behind Bitcoin, so it is unclear whether the Bitcoin ETF would have represented the true value of Bitcoin.

Overall, I think this is a good move by the SEC. I have previously written that adoption and regulation of cryptocurrencies like Bitcoin by governments is a step in the right direction to making all transaction digital. However, putting Bitcoins on the stock market without subjecting it to some form of regulation first mirrors how a lot of new emerging technologies enter the market today – before the government even has time to draft regulation for it, a new technology arrives to disrupt the market. Right now, with the spotlight on Bitcoin and the SEC, there remains time for regulators to find a way to regulate cryptocurrencies, and for Bitcoin to prove their currency is secure and valuable enough to be traded on the stock market.

Source:

http://fortune.com/2017/03/10/bitcoin-price-etf-winklevoss-approval/

Today’s consumers, business partners and key stake-holders want information on-demand. For many organizations, providing this data quickly and efficiently places a considerable strain on employee resources. Here is 4 ways to improve efficiency.

1. Integrate your business systems and applications
   Bridging the gap between disparate systems and online web services enables organizations to have business applications that ‘talk’ to each other to reduce process bottlenecks and remove repetitive data entry tasks.

2. Dynamically optimize employee productivity
   Employee productivity can be optimized by intelligently routing out of system workflow tasks to individuals or teams to gather valuable decisions and response feedback.

3. Automate everyday company documentation

Automating the creation and distribution of reports, statements and other documentation can remove unnecessary administration, safeguard your organization against human errors, increase the visibility of information and assist with improving management decision making.

4. Introduce external real-time business notifications
   Identifying potential issues before they happen enables organizations to make informed decisions which are based on critical data events.

Not only limited in the financial information system, the optimal goal for most of the system is to achieve automation, which comes with high speed and accuracy.

Source:

4 Ways To Improve Business Performance When Using SAP Business One

Samsung may be implementing Samsung Pay to their non-premium phones such as the Galaxy J series phone priced around $115. Samsung Pay allows users to save credit cards, gift cards, as well as other payment methods.

Samsung Pay recently launched in India. Samsung has been strategically and quietly adding Samsung Pay to cheaper phones and plans to experiment the idea in India. One of the reasons that Samsung possibly chose India to experiment with Samsung Pay on cheaper phones is because out of 85 million Samsung phones in India, 25 million are cheaper Galaxy J series. Also recently, India prohibited 500 rupees and 1,000 rupees bills from circulating thus making Samsung Pay easier to buy things.

If expanding Samsung Pay to cheaper phones in India turns out to be successful, it will be a very clever move made by Samsung. With the dense population in India, Samsung can easily turn into the mobile payment industry leader. However, competitors such as Paypal and Apple Pay can easily catch up as well. The competition against the many mobile payment companies are growing more and more intense but if Samsung can secure the first-mover advantage, they can secure their placement in the industry.

 

Source:

https://www.cnet.com/news/samsung-pay-galaxy-j-phones-india/

Payment companies are trying to push their boundaries of innovation, as wearable tech is becoming more mainstream. We can find this push of boundaries in this week itself that saw launch of two new payment-enabled wearable devices – Movado announced the launch of a line of smartwatches that will likely enable contactless payment functionality to ‘Kerv’ a new contactless payment ring, launched in the UK.

Barclaycard’s wearables a UK card issuer, saw £6.6 million ($8 million) in transactions from July 2016 to February 2017, and Tractica, a market intelligence firm expects the volume of these wearables to grow to up to $501 billion by 2020.

According to BI Intelligence “payment functionality will be included in 62% of wearable device shipments by 2020.” In markets with huge user base for contactless payment this could act as a catalyst for larger adoption.

I feel that customers are getting more and more interested in wearable payments but it is not likely that they may buy a new wearable just for making payment transactions. They are more interested in using multi-purpose accessories that allow them to do more than just payment, a best example of that would be smart watches, providing additional applications for other purposes. So, companies might have more success focusing on multipurpose offerings or integrating payments into products users already own or might buy rather than selling a dedicated payment device.

 

Reference: http://www.businessinsider.com/heres-whats-holding-back-wearable-payments-2017-3

In every era there is one defining company that paves the road for the entire industry. Social media had Facebook and ride-sharing had Uber. Many critics have yet to come to a solid conclusion if that company has been found for fintech yet. While many different companies have propelled the banking business far, it does not have a clear cut path for who is the “Facebook of Fintech”.

Some have argued that CapitalOne is that industry shifting company that has impacted Fintech, but many disagree. Although CapitalOne was one of the first movers for data-driven marketing for the banking industry, it does not exemplify the technological age in which Fintech has propelled itself into.

The company does have a variety of online banking tools and mobile apps that contends itself to be in the FinTech industry and has been consistently ranked in the top 20 for App Annie’s.

However, have we had that “game changer” start-up that has shifted the world of Fintech? According to a recent twitter 68% said we have yet to see that happen.

So, let’s all be on the lookout for that monumental mover that will take Fintech to a whole new level.

Source: http://bankinnovation.net/2017/03/is-bankings-uber-moment-coming/?utm_medium=email&utm_source=fintechweeklycom

Dubai Financial Services Authority (DFSA) recently released a consultation paper which includes some core principles that Dubai uses to regulate fintech in the country. With a vision to be a fintech hub, Dubai takes an approach that is “flexible, response, innovative and adaptable”with fintech firms. Dubai’s goal is to set up a testing environment for the fintech companies to ensure that the products’ users are protected. Other than this, regulations are supposed to be minimal, and the DFSA should only regulate if needed. Dubai set a group of criteria that the fintech companies need to meet in order to get a testing license. Basically, these criteria ensures that the company who participate are truly financial technology companies. For example, it requires that the companies who sign up for the testing must involve the use of financial technology and must involve financial services that are currently regulated by the DFSA. Once a firm is granted a testing license, it will be able to test its fintech product with customers under a set of rules posed by the DFSA. After the product passes the test, it will receive a full Financial Service License.

Personally, I strongly agree with the approach that Dubai takes to regulate Fintech. As I mentioned in previous blogs, regulations are definitely needed in fintech, not to suppress its development, but to ensure the interest of customers. Good regulations can both create a environment that encourages fintech innovation, and protect customers from abuses. DFSA’s approach has definitely set up a standard for the rest of the world.

Source: https://www.cryptocoinsnews.com/dubai-financial-regulator-reveals-fintech-regulatory-approach/

The U.S. is producing many fintech startups attractive to investors but not as attractive as the Asian startups. The third quarter of 2016 was the second of the year in which Asian fintech companies attracted more venture capital funding than North America. America remains a fintech leader, but its position is being challenged.

One reason is that the U.S. fintech hubs are subject to regulation at the state level, by the Department of Financial Oversight in California and the Department of Financial Services in New York, respectively. Another is the lack of government support and collaboration with businesses in innovative fields.

One major step undertaken by the U.S. government to deal with the problem is the attempted creation of a “sandbox” on the model of the successful U.K. one, with the Financial Services Innovation Act of 2016.

Some information source says new regulation specific to fintech may not be coming at all, and the lack of clarity about the administration’s economic plans will likely slow investment in the sector.

In my opinion, the U.S. government should clarify the law and regulations on fintech industry as soon as possible. The damaging effects of the uncertainty of regulations on American fintech growth, are likely to continue until specific steps are outlined to ease and clarify the regulatory burden facing U.S. companies.

 

Source: https://techcrunch.com/2017/02/16/us-regulatory-environment-threatens-the-rise-of-fintech/

This article highlighted how artificial intelligence is likely to be a large part of the future of fintech due to the highly competitive environment requiring companies to leverage new technologies as much as possible. Competition in the industry is beginning to stiffen, so in the future, it will become more and more important for fintech to leverage technology like AI in their platforms in order to stay competitive with the competition. The main benefit that AI will be able to provide is eliminating guess work and human error that comes out of finance. For these reasons, it is believed by many that AI may hold the eye to the future of fintech innovation. It will be interesting to see in the future which companies are able to provide the best user experiences, which in turn are likely to set the basis for which companies establish the best brand images and user adoption rates.

Link to article: https://thenextweb.com/artificial-intelligence/2017/03/07/ai-will-determine-future-fintech/#.tnw_Hf7k5buZ

In today’s business world, data is a valuable corporate asset which, when managed properly, can support a company’s ability to achieve strategic goals and financial results. Executives can improve their ability to quickly access accurate data by adopting MDM best practices. MDM typically involves a series of consistent processes and policies with proper governance and oversight. Master Data Management is focused around several key and actionable business segments including, but not limited to, the material, customer, supplier, and employee master.

Strong Master Data Management governance can drive greater consistency and accuracy of data, which can be an asset in driving world class operations, providing the ability to use data as a competitive advantage, and reducing unnecessary waste. In contrast, without proper governance, there is limited accountability and ownership of data, which creates compliance risk as well higher expenses and lost revenue.

A lack of sound master data processes and procedures can cause major issues that diminish the value of data and systems. Addressing these issues by implementing MDM ownership and governance can help resolve many of these concerns. Therefore, effective management of master data is crucial as they are the means of attaining other strategic and operational objectives.

 

Source: http://spendmatters.com/2013/05/09/the-importance-of-master-data/

2017 will be an interesting year for FinTech companies and the Fintech market as a whole. PWC predicts in the annual report that they publish that in 2017 global fintech investment will exceed 150 billion dollars. According to the Fortune this, along with new trends in the Fintech environment, will allows 2017 to be a strong year for Fintech. One of the biggest keys to Fintech success in 2017 will be the increased role of mobile devices in the FinTech environment. With smartphones becoming such an integral part of consumers everyday lives, by integrating a mobile driven aspect to Fintech technology, companies can reach a greater audience and at the same time provide a greater benefit to the consumers. Blockchain is also playing a large role in the FinTech world. A few of the biggest fintech deals in 2016 revolved around the use of blockchain technology, and continues to gain more and more popularity and developments are made to strengthen security and privacy issues. The most important characteristic however, has to continue to be accessibility. The Fintech market holds so much potential because many of the technologies that are being developed have the potential to reach lower income families, and make it easy for them to use, eg through mobile apps or lower fees. If Fintech continues this trend, then we could be seeing an expansion of total investment and companies.

http://fortune.com/2017/03/10/financial-technology-trends/