Card networks and issuers settle with merchants on fees (TWIF 3/29)

Hello Fintech Friends,

Trevor Tanifum, a Principal at fintech strategic consulting firm FS Vector, wrote a guest post for us this week about a recently hot topic: direct vs. indirect bank strategies at banking-as-a-service providers. Read on to understand what the difference is – and it matters to BaaS providers and regulators.

Still have questions on fintech, regulations, BaaS, or anything else? Join us at our NY Fintech Week breakfast with Obvious Ventures on April 9th! 👇

Please enjoy another week of fintech and banking news below. (👍👎 Have feedback for us? Let us know!)

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Visa – a TWIF partner – launched three fraud prevention solutions as part of its Visa Protect suite. The three AI-powered solutions are designed to reduce fraud across immediate account-to-account and card-not-present payments, as well as transactions both on and off Visa’s network.

BlackRock is launching a tokenized private equity fund in partnership with financial services firm Securitize as the company deepens its foray into digital assets.

Global financial technology FIS launched SecurLOCK, a card transaction fraud management solution built in partnership with fintech Stratyfy.

Mastercard, Visa, and the largest American card issuing banks agreed to a settlement with merchants over nearly two decades of lawsuits over the fees they charge for credit card payments. Under the terms of the agreement, the networks would lower all rates by 0.04% for three years, and the average rate across the networks would be lowered by 0.07% for five years. Interchange fees are typicall around 2% of a transaction. The settleemnt would also give small merchants the ability to form groups to negotiate swipe fees, similar to what large retailers do today, and would allow merchants to charge different prices for different cards, in order to theoretically pass along the higher fees of premium cards to consumers. Given consumers' singificant entrenched preference for credit card rewards and the psychological effects of paying with a card, it's still unclear whether the shift in fees will have any impact on consumer payment method choices.

Mastercard partnered with business payment processing and cards provider Worldpay to offer Mastercard's Ethoca Alerts to its one million merchants worldwide.

The British Business Bank will make £660 million available to small businesses in the form of loans and equity.

UK building society Nationwide's customers were affected by payments between it and other banks and building societies being delayed.

The CFPB warned against continued bank consolidation, and argued that efficiency gains were not necessarily passed along to consumers.

Western Union launched an eSIM mobile data service using its Powered by Breeze solution.

Roboadvisor and consumer savings platform Wealthfront enabled free same-day withdrawals from its Wealthfront Cash accounts using RTP.

AI-powered fraud and risk platform DataVisor, launched a machine learning-based end-to-end anti-money laundering.

Centrifuge, a protocol for trading real world assets (tokenized versions of non-cypto assets), launched an on-chain fund management platform to import credit funds.

B2B payments and invoicing network TreviPay launched a self-financing option to give sellers more control over their trade credit portfolio.

American neobank Varo Bank launched two new products to help their customers dealing with financial stress – a line of credit up to $2,000 and a personal finance manager showing real-time trends.

Card tokenization and digital payments enabler MeaWallet launched a platform developed to ensure the secure transmission of sensitive payment card data between customers, payment processors and service providers.

Payments and treasury management provider Modern Treasury announced a professional services consulting business to help its enterprise clients with money movement.

Robinhood launched its new Gold Card, a premium user card with 3% cashback across the board, 5% through booking travel via its new travel portal, and $50 in annual membership costs.

French remittances and money transfer provider Tempo France is suspending is legacy remittances infrastructure to build on DeFi.

Amazon is leveraging Stripe to implement its Just Walk Out technology in Australia in Canada. "The guest enters the store by using their credit card or mobile wallet at the entry gate. The technology detects what shoppers take from or return to shelves and creates a virtual shopping session. When the guest completes the shopping experience, they can simply leave the store without waiting in line."

Financial messaging provider Swift was selected to build national confirmation of payee service in Australia.

UK open banking-based startup BuildMyCreditScore said that users have seen an average 52 point increase in their credit scores in the first three months.

Cornerstone Advisors reported that Chime passed 38 million customers, possibly more primary consumer bank accounts than JP Morgan Chase.

Summer, a student loan benefit provider, partnered with ADP to allow ADP's retirement plan clients to offer Student Loan Retirement Matching and additional student debt tools.

Hashnote is partnering with PayPal to improve settlement for the interest-bearing USYC token using PayPal's stablecoin.

Mos, a student financial aid and student loan platform last valued at $400 million, is in hot water for overstating its user numbers (400k vs. 30k), linked banks, and financial aid amounts.

The US Justice Department filed a lawsuit against Apple, accusing the firm of monopolising the smartphone market through blocking third-party apps from offering contactless payments in favor of Apple's digital wallet.

Crypto provider Genesis agreed to pay a $21 million civil penalty to the SEC for the unregistered offer and sale of securities.

Lottery-based savings provider Prizepool received a cease and desist notice from the FDIC for false and misleading statements regarding its deposit insurance.

Federal prosecutors in the US charged crypto exchange KuCoin with anti-money laundering policy violations.

The US placed sanctions on 13 fintech firms for offering crypto services to Russian firms looking to evade economic restrictions.

Crypto biometric ID firm Worldcoin was banned in Portugal over privacy concerns.

Banking-as-a-service provider Synctera finished a restructuring that laid off 15% of the company, shortly after a new fundraise and expansion into Canada.

British crypto firm Copper reportedly held a corporate event where attendees 'were served sushi off the bodies of half-naked models.'