Tracking Payments - Issue #4

Can corporates follow the conscious consumption trend?  An ESG use case for ISO 20022.

“Providing frequent updates about the sustainability of their business is becoming more crucial for finance chiefs, as analysts and investors increasingly rely on [ESG] information when evaluating a company’s outlook and its creditworthiness.”
+ WSJ: Providing Timely ESG Information Is Becoming More Crucial for CFOs

Mastercard and Klarna are offering tools, distributed via banks and merchants to help conscious consumers see how their spending impacts the environment. The tools are based on an index that measures the carbon impact of financial transactions

Integrating similar data with B2B transactions using ISO 20022 can make it much easier for CFOs to report on ESG impact to credit and stock analysts.

+ Harvard Law: ESG Drivers and the COVID-19 Catalyst
+ HBS: Four Things No One Will Tell You About ESG Data
+ Finextra: Big banks join net-zero emissions alliance
+ Fast Company: More than 60 global announce commitment to transparency

*Shout out to Pamela Steer for your excellent insights.


‘Britcoin’: Are your payment systems ready for digital fiat?

The UK and Norway announced new steps towards rolling out Central Bank Digital Currencies.

“Central bank digital currencies (CBDCs) would help advance the digitalisation of payments and the economy as a whole. Retail, wholesale and international payments using CBDC would expand choices, enabling more diversified payment systems and greater autonomy for the central bank.”
+ Accenture: CBDC for retail, wholesale and international Payments

Perhaps the most compelling value proposition of CBDCs is giving the incumbent financial industry a profitable opportunity to serve the “...1.7 billion people [who] do not have access to a bank account and are unable to tap into financial institutions to borrow, save, or invest.”. 

+ BIS: Rise of the central bank digital currencies: drivers, approaches and technologies
+ Atlantic Council: The Rise of Central Bank Digital Currencies includes a global tracker.
+ PaymentSource: The 10 places where the U.S. wants to mandate cash
+ OMFIF: China is undermining the dollar’s global role
+ CoinDesk: No, the Digital Dollar Won’t Kill Bitcoin (podcast) 


Embedded Finance Investment Trends:

Theme 1: Simplify lives for CFOs

+ Bottomline acquired TreasuryXpress - to expand from payment management to cash management.
+ Routable raised $30M Series B  - a secure invoice and bill payment platform that sends and receives B2B payments. 
+ Payhawk raised $20M Series A - a platform for payments and expense management to collapse cards, payments, expenses and cash into a ‘seamless experience’.

Theme 2: One-stop shopping for merchants

+ Square for Retail rolls out new capabilities to expand from ecommerce, lending and payments into inventory management.
+ Stripe announces Stripe Treasury - banking-as-a-service product which embeds financial services enabling customers to send, receive and store funds. 


Extras:

+ Chris Skinner estimated ⅔ of bank employees are redundant. No wonder fintechs continue to WAY outperform traditional FIs in the public markets.