India sets off on
the long road to a
cashless society

RupeeThe Republic of India hopes to boost digital payments via Aadhaar Enabled Payments and Unified Payments Interface, or UPI. But it faces two problems:

Problem 1. Banks are largely responsible for getting merchants to accept digital payment via Aadhaar and UPI.

Problem 2. India’s government would like banks to show a bit more oomph in that regard.

That’s why India’s government is looking at rewarding banks with up to 10 rupees per Aadhaar and UPI transaction.

Dissatisfied with the National Institution for Transforming India (NIRI)’s progress, last year Prime Minister Narendra Modi transferred responsibility for promoting adoption to the Ministry of Electronics and Information Technology, or MeitY. The latter has made the current proposal.

The Economic Times reports, “Funds will be made available from the India Inclusion Fund of Nabard and the corpus could be as high as Rs 1000 crore, according to an official.” A crore equals 10 million. Depending on exchange rates, Rs 1000 crore works out to somewhere between $150 million and $202 million in U.S. dollars. Not exactly chicken feed, depending, I suppose, on the chicken.

India has already announced consumer incentives as well. For consumers who pay using digital technology, there will be a .75 percent discount on gasoline, a .5 percent discount on rail fare and hospitality services, a full 10 percent discount on insurance premiums, and other incentives.

Not that I’m complaining, but I was curious as to why the Republic of India is gung-ho about digital payments. I learned that the underlying goal is ambitious: India wants to go cashless, period. There are myriad reasons, from frustrating tax evaders, to countering a sudden physical currency shortage, and, as Slate points out

This government is trying to fight corruption and move towards a more digital economy. In India, people have stashed away huge amounts of money—income that has never been declared and is then laundered through extravagant weddings, construction work, luxury vehicles, jewelry. Nobody knows exactly how much “black money” there is, but it’s safe to say that there’s a lot.

All of which may account for GSM Association and Boston Consulting Group’s prediction that digital payments in India may top $500 billion U.S. within three years.

Incentives aside, the road to cashless-ness is a long one. An NPR article by Julie McCarthy cites a Pew survey showing that only 17 percent of Indians own a smartphone and only 20 percent have Internet access. Moreover …

[Senior Associate Dean at the Fletcher School at Tufts University Bhaskar Chakravorti], who co-authored a report titled “The Cost of Cash in India,” found that, “most Indians lack the means to use cashless alternatives irrespective of their desire to do so.”

There’s a proposed solution for that one, too. Chief Minister of Andhra Pradesh N Chandrababu Naidu recently recommended a Rs 1000 subsidy for smartphone purchasers. With sm3artphones in India priced from Rs 6999 to Rs 12,999, it remains to be seen how much the subsidy will help out India’s considerable poor population. Especially, as Chakravorti continues:

“The digital infrastructure in India is so horrendously poor,” Chakravorti says. “The majority of people don’t have access to smartphones. Large numbers of them cannot read or write. Mobile connections are extremely poor. Even the people in the city, for them connections are terrible.”

These are real problems, and they are not necessarily unique to India. It might be a good idea to keep our eye on India as it works through them. Their experiences may streamline the process for those who follow.

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X, Y, Z … A?


Dub them Y-nots or Alphas, one thing is certain: My son’s generation comes with finely-tuned chocolate cookie detection ability.

If you adopt an alphabetized naming system, think twice before starting with X. You will run out of letters in no time.

Having gone through X, Y, and Z, marketers are wondering what to call the rising generation of preschool- and elementary school-age children. Fortune remains agnostic as to what the name will be. Futurist Mark McCrindle blogged that submissions in response to a survey included “… the Regeneration, Generation Hope, Generation New Age, the Saviours, Generation Y-not and the New Generation.”

Much as I like the idea of calling my kids “Y-Nots,” what seems to be gaining favor and will likely prevail is a suggestion that we circle back to the letter A with “Generation Alpha.” This may be due in large part to the fact that McCrindle, who does not want for media exposure, has championed it in a big way.

I bring up McCrindle with hesitation. There is some question as to how much to rely on his claims. ABC Media Watch looked into him and emerged not altogether reassured:

… the media have been happily running this stuff for years, without apparently ever bothering to question its claims. It’s just typical of the dross that fills our TV, radio and newspaper every day.

But all the media coverage gives McCrindle Research the publicity to attract private, paying clients. And it gives Mark McCrindle a high profile on the lucrative public speaking circuit.

Either way, McCrindle’s term of choice seems to be edging out competing ones. Publications that have embraced “Alphas” and credit McCrindle for it include Forbes, Business Insider, The New York Times, and

An Advertising Age piece by Sysomos chief strategy officer David Berkowitz treats the adoption of “Alphas” as a fait accompli, albeit without reference to McCrindle. Perhaps prematurely, since by his definition the oldest Alphas will start elementary school next year, Berkowitz predicted “13 Things to Know About the Alpha Generation.” He goes out somewhat on a limb with a couple of specifics, like Alphas will “hate sharing the economy” and love “full-fat, organic dairy,” but most of his predictions are broad and, therefore, safe: I challenge you to name any population to whom you couldn’t retrofit “They don’t play by the rules” or “They break free of any boundaries.” Guaranteed not to fail is “They are very mobile, except when they’re stationary.” Can’t argue with that.

The possible absurdity of predicting Alphas’s behaviors this early is summed up in a pragmatic question that Alex Williams of The New York Times put to McCrindle in an interview conducted by email:

Is it jumping the gun to try to define a group of people who are barely past the age of watching ‘Barney & Friends’?

Instead of answering, McCrindle raved about Alphas in terms of projected numbers:

There are more than 2.5 million Gen Alphas born globally every week. When they have all been born (2025), they will number almost two billion. They start school next year and will be the most formally educated generation ever, the most technology supplied generation ever, and globally the wealthiest generation ever.

Maybe so. But then, maybe we should give Alphas a little more time to grow up before committing dollars to anyone’s predictions.

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Under the new
Predicting the
future of fintech

Wilcox on future of fintechPerhaps you heard: The United States has a new administration.

Relax. I’m not going to opine here about bathrooms, health care, or walls. I could think of no surer way to lose about 50 percent of valued personal and business relationships. Instead, I’m going report on sundry educated guesses as to what we in the payments industry might expect.

There is widespread agreement that the Dodd-Frank Wall Street Reform and Consumer Protection Act faces serious revision if not outright repeal. The act’s stated purpose is:

To promote the financial stability of the United States by improving accountability and transparency in the financial system, to end too big to fail, to protect the American taxpayer by ending bailouts, to protect consumers from abusive financial services practices, and for other purposes.

Dodd-Frank merged a number of federal agencies and created a fair share of new ones, the most notable being the Financial Stability Oversight Council, the Office of Financial Research, and the Bureau of Consumer Financial Protection. Depending on whom you ask, Dodd-Frank is a godsend, a millstone, or a bit of both. TechTarget offers a succinct summary of the two views. Proponents, it says …

… believe the act prevents the United States economy from experiencing a crisis like that of 2008 and protects consumers from many of the abuses that contributed to that crisis.

… whereas opponents …

… believe the compliance burdens the legislation creates makes [sic] it difficult for U.S. companies to compete with foreign counterparts.

But, in any case …

In February of 2017, President Trump issued an executive order that directed regulators to review provisions put in place by the Dodd-Frank Act and submit a report on potential regulatory and legislative reforms.

The award for scariest headline goes to Nasdaq, who recently ran the not terribly reassuring, “Will Trump Disrupt the Payments Industry?” The article quotes E&S Consulting founder Lori Breitzke:

“Trump may repeal the CFPB, given his disdain for [Dodd-Frank]. If this occurs, the CFPB’s new prepaid card rules will be repealed along with the agency, and another entity will be created to replace it. ​If Trump cannot repeal the CFPB, he will instruct the agency to ignore, rather than enforce, the existing rule governing prepaid cards. Trump also will lower taxes on small businesses, fostering growth and the need for more merchant accounts and services.”

A number of journals are following Trump’s threat to cut off remittance send from the U.S. to Mexico. Shortly after the 2016 election, Business Insider reported that the threatened cutoff:

… could drastically curtail the operations of US remittance firms. Mexico is the largest receive destination for US remittances, cashing $25 billion in 2015, according to the World Bank. The strength of that corridor is pushing firms to double down on Mexico—for instance, Western Union recently nearly doubled the size of its retail network in the country, and MoneyGram unveiled a product in partnership with Walmart to make it easier and less expensive to send money from the US to Mexico. Cutting off access to the corridor, even temporarily, could drastically change the trajectory for these companies.

For mobile payments, the news may not be all bad. Most agree that the threatened cutoff may, as John Rampton, writing for Mashable, observes …

… put mobile payments, such as digital wallets and peer-to-peer payment apps, in a better position to thrive. Unlike traditional payments companies, these allow users to make cross-border payments without government interference.

Rampton takes a look specifically at the payments industry. He predicts a rollback of regulations welcomed by the financial services industry, agrees that cutting off remittances to Mexico could have adverse economic consequences, especially for the likes of Western Union, and reports a curious, early “skirmish” between the administration and the New York State financial regulator Maria Vullo, who wrote, “The OCC should not use technological advances as an excuse to attempt to usurp state laws that already regulate fintech activities.” Vullo was reacting to the White House’s just-released whitepaper, “A Framework for Fintech,” which, as of this writing, the White House has apparently pulled from its site.

Predictions by various pundits, policymakers, and reporters are all over the board. One thing all appear agreed on, however, is that no one really knows what’s coming. As Rampton summed up,  “While the new presidential administration could bring about many new changes in the payments system—both good and bad—it’s still too early to predict exactly what’s going to happen.”

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Gooligan Hooligans

Gooligan was unavailable for a photo, so here’s Gilligan instead.

Those poor hackers. Imagine not getting credit for your work when it goes on to fame, anonymity being recommended for staying out of prison. And no matter how clever a moniker you cook up for your creation, you’d know it’s destined for oblivion, since the privilege of naming it goes to those who detect it. All you can do is hope they come up with something worthy.

I bet a certain group of hackers in China were pleased when it got back to them that California-based cyber-security firm Check Point Technologies had dubbed their baby Gooligan. You have to admit the name has a ring.

An update of a larger scam from two years earlier, so far Gooligan has infected an estimated 1.3 million Android devices. According to Check Point,

Gooligan roots devices and steals email addresses and authentication tokens stored on the device. With this information, an attacker can access a user’s Google account data within Google Play, Google Photos, Gmail, Google Drive, and G Suite.

Owners of Gooligan-infected devices have suffered no direct damages as of this writing. Gooligan, it seems, was after larger prey: Companies that shell out big-time to elevate an app’s rating, pushing it nearer the top of searches, and thus increasing the likelihood of sales. As a recent Consumer Reports article put it, Gooligan tricked …

… marketing companies such as Mobvista, Apsee, Startapp, and the Google-owned AdMob into paying for what looked like successful, legitimate efforts to boost the popularity of certain mobile apps.

The same article reports, “The Chinese hackers behind Gooligan were making as much as $500,000 a month by exploiting their access to the phones.”

Gooligan and smartphone hacking

As I wrote last month, predicted, “… as the ability to use counterfeit cards in stores dries up, fraudsters are expected to turn to other forms of fraud that prey on different vulnerabilities.” Though the article’s focus is on fraudulent credit card account use for Internet purchases, the Gooligan affair serves as a reminder of another, fast-growing danger, namely, smartphone hacking.

A recent Fiserv study showed that households banking via smartphone increased 17 percent in 2015. I wouldn’t be surprised if 2016 shows a greater increase. It would be unreasonable to think that hackers moving away from point-of-sale credit card fraud would limit themselves to online purchases. Not only are smartphones ideal hacking targets: Few users understand the need to secure their phones, and fewer bother doing so.

Financial institutions have an opportunity to provide a valuable service in the form of pointers for protecting smartphone and tablets from hackers. Suggestions might include installing vetted anti-virus / anti-malware software; using password or fingerprint protection; purchasing apps only through trusted sources like Google Play and iTunes; not accessing sites using financial or other personal data through unsecured wireless connections; accessing a website’s features and correspondence only from within and not, say, from emails; and installing operating system updates as fast as they’re released.

No need to worry about scaring clients. They’re already scared. Showing clients how to protect themselves is not so likely to alienate them as to bolster their confidence and win their appreciation for caring enough to share useful information.

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Digital Newspapers:
A few rays of hope

Digital papers for sale

Perhaps you heard: Newspapers have had a tough time making the transition from print to digital. The good news is that for some papers that’s starting to turn around.

When digital publishing first became a thing, most papers made content available online for free. The idea was to supplement printed editions, the industry’s mainstay. What the industry failed to figure out in time was that printed editions wouldn’t remain the mainstay for much longer. By the time it was clear that the future lay in digital publishing, the public had grown accustomed to free digital content, and no newspaper was eager to be the first to start charging. Nor did it help that revenue from online advertising sales paled in comparison to what papers had charged for printed editions. 

The industry underwent drastic cuts as a result. Layoffs were commonplace. Investigative journalism departments were among the first to go, with fact-checking departments close on their heels. Some papers merged, some scaled down, some traded reporting for pandering, and not a few closed their doors. The Huffington Post debuted a new model: It was an online paper that had no print edition, and the bulk of its content was either aggregated or contributed by unpaid writers. At the same time, everyone else who wanted to publish a news blog or aggregation site could easily do so—and pretty much everyone did. None of these developments did much for the quality, much less the reliability, of reporting. 

But legit digital news publishing is starting to turn around, for a number of reasons. Some of the reasons are positive, and some are disconcerting.

I’ll start with the positive reasons. Over time, newspapers have figured out how to charge for digital content. Whether or not you’re a fan, The Washington Post provides a good case study. The Post gambled that there were still people out there who would pay for its style of reporting. To help those people along, the Post began letting readers click to a limited number of articles per month at no charge. On, say, the tenth click-through, readers were asked to register and, in time, fork over for a subscription. And in a tactic lifted directly from the old print days, the Post offered free, limited-time digital subscriptions in hopes readers would like the content and pay to continue receiving it. 

The Post received a considerable a boost when Jeff Bezos purchased it in 2013. For one thing, Bezos had a bit of capital to work with. For another, you probably know that Bezos has connections with, and he used them to extend tempting Post offers to Amazon Prime members. At the same time, he gave Kindle owners and Kindle app users a free six-month Post subscription. To keep impatient readers from bailing, he cut page-load time by 85 percent. More recently, the Post has begun publishing all of its articles to Facebook’s Instant Articles, which quickly uploads articles to Facebook mobile apps. 

All of which appears to be working. Post subscriptions are on the rise. Meanwhile, other papers are taking note and show promise of rebounding

There is now a growing opportunity in the form of people uninterested in a full subscription but willing to pay, say, 25 cents for an article here or there.

Until now, per-article sales for digital publications haven’t been financially viable, however, applications like Blendle offer hope. Business Insider reports: 

There are reasons for optimism—many publishers have bought into an app called Blendle, which aggregates content and makes payment more frictionless. And Blendle has seen modest gains since launch, which indicates that micropayments could gain traction under the correct circumstances. If a giant, like Apple, Google, Facebook, or another platform where customers both have existing news and payment relationships, were to take the challenge on, its value could begin to increase. 

On the more disconcerting side is the thought that digital journalism’s rebound may in part be due to the rise of fake news and irresponsible headlines. Increasing awareness of fake news may be driving a growing number of readers to reliable news. Also on the disconcerting side is today’s polarized politics. While it drives some people to feedback loops, it may make others willing to shell out for sources with established bona fides. 

I hope we see more and more responsible digital newspapers become fully viable. The day may yet come when they completely supplant paper editions. Who knows: Future generations may ask why we call that thing on a smartphone or tablet “the paper,” much as today’s rising generation isn’t quite sure why we call using the keypad on a smartphone “dialing.”

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