The Payment Predicament


Jun 08, 2024


Sarah Parsons Wolter


Jun 08, 2024


Sarah Parsons Wolter


In an era in which innovation should be creating the space for more optionality at lower costs, the opposite shift seems to be occurring in the world of payments. Instead, consumers have been getting squeezed from all angles.

The move to cashless establishments, especially accelerated during COVID, has been a particular problem for low income and older consumers that don’t always have access to alternative forms of payment. The solution? You may jump to the logical answer of accepting cash once again - especially given the historical precedent of paying with cash to receive a discount - but you’ll have to guess again. Rather, businesses have installed reverse ATMs, charging fees of $1-6 to ingest cash and produce temporary debit cards.

Even premium cardholders are not exempt from these challenges. Amex fees have historically limited its acceptance, but this issue has worsened recently. At the Money2020 conference in Amsterdam this week, we found ourselves having to put away our Amex cards, with only Visa, Mastercard or Maestro being accepted for coffee purchases around town. Adding to this trend, major marketplaces like eBay have announced they will stop accepting Amex too.

This begs the question - will Visa and Mastercard continue to eat the world, or is there some other payment solution that will emerge as the happy medium between merchants and consumers?

Portfolio News

Vestwell announces expanded access for financial advisors to J.P. Morgan Asset Management Everyday 401(k) - J.P. Morgan’s workplace savings platform for small businesses will continue to be offered through JPMorgan Chase business banking and will now be available to financial advisors, jointly distributed with Vestwell. In addition to scaling advisors’ workplace savings practice, Everyday 401(k) is expanding with new capabilities, allowing financial advisors to serve as a 3(38) investment manager on the workplace retirement plan. Read more

Plaid launches a new product to take cash flow underwriting mainstream - Cash flow underwriting has been “the next big thing” in lending for several years now. And while several lenders are using it as part of their underwriting, it has not become a mainstream tool. This could now change as Plaid is expanding its product suite with the launch of a new credit report that gives lenders insights into consumer cash flows. Read more

BMO now using CapIntel - Advisors and investment counselors can use the platform as a centralized hub for managing client portfolios, conducting market research and generating personalized recommendations. Read more

CoinLedger listed as top crypto tax app - Crypto News Flash listed CoinLedger as ‘a lifesaver’ for making capital gains reporting straightforward. Read more

Sabi creates a lane of its own as it enters its third year - Providing digital infrastructure for manufacturers, distributors, retailers, and farmers, Sabi offers payments, logistics, and market intelligence services. With 250k users and 15k monthly orders, it nearly tripled its revenue in 2023. Read more

The Payment Predicament

EBay cutting Amex ties over card fees - The two companies have been negotiating merchant discount rates — otherwise known as interchange fees — that Amex charges at the point of sale. The fees are charged each time a card is used and can add up, with one trade group saying card processing fees cost retailers more than $172b in 2023. Read more

Want to pay cash? That’ll cost you extra - Paying with cash used to be a way to get a discount. These days it can often cost an extra $1 to $6—the sort of transaction fees once limited to swiping a credit card or using an out-of-network ATM. Read more

Industry News

New Texas stock exchange takes aim at New York’s dominance - The exchange is aiming to tap in to disaffection with increasing compliance costs at Nasdaq and NYSE and newer rules like one setting targets for board diversity at Nasdaq. Backers of the TXSE, as it is known, pledge it will be more CEO-friendly. Read more

AI is promoted from back-office duties to investment decisions - Asset managers are increasingly using artificial intelligence to guide investment decisions, track the habits of portfolio managers and identify moneymaking opportunities. Some fund managers are using AI to complement human analysts, identify targets for litigation finance and explain allocation decisions to investors. Read more

E*Trade considers kicking meme-stock leader Keith Gill off platform - At E*Trade and its owner Morgan Stanley, that power created concerns he can pump up a stock for his own benefit. Their debate includes whether his actions amounted to manipulation and whether or not the firm is willing to risk drawing the attention of his meme army by removing him, according to people familiar with their internal discussions. Read more

Trading glitch sends some shares on a wild ride - For about two hours on Monday morning, trading in shares of about 40 stocks on the New York Stock Exchange was halted after a technical glitch led to misquoted prices, including those of Berkshire Hathaway, which showed a drop of more than 99%. Read more

Financial data group Preqin exploring a sale - S&P Global and BlackRock are among potential suitors for the UK-based provider of data on private markets, which could be valued at more than £1b. Read more

Robinhood acquires global crypto exchange Bitstamp for $200m - Today’s deal not only signals California-based Robinhood’s continued push into crypto, but also its international expansion efforts. The company launched its core stock-trading product in the U.K. last November, and started offering crypto trading in the European Union (EU) shortly afterwards. Read more

CFPB launches process to recognize open banking standards - As reported by Axios, under a final rule published this week, the CFPB will require industry bodies seeking to set open banking standards to include consumer advocacy and small companies in the voting process. Read more

How researchers cracked an 11-year-old password to a $3m crypto wallet - A great story about how “Michael” lost access to his 43.6 BTC in 2013 (worth about $4k) due to a corrupted password file but got it back in November 2023 with the help of a Hardware hacker. Read more

Select Financings

Aperture Finance - California based decentralized finance platform raised $6.7m in Series A funding led by Skyland Ventures, Blockchain Founders Fund and Krypital Group. Read more

Avail - Dubai based modular blockchain startup raised $43m in Series A funding led by Founders Fund. Read more

Bcas - Madrid based income-sharing higher education financing company raised €17m in new funding led by MyInvestor and Actyus. Read more

Continuity - France based startup assessing risk for insurers raised €10m in new funding led by 115K. Read more

Everclear - San Francisco based blockchain interoperability protocol raised $5m in new funding led by Pantera Capital. Read more

Fibe - India based digital lending platform raised $90m in Series E funding led by Amara Partners, TR Capital and Trifecta Capital. Read more

Fizz - San Francisco based credit building debit card startup raised $14.4m in Seed funding led by Kleiner Perkins. Read more

Hypr - New York based identity assurance company raised $30m in new funding led by Silver Lake Waterman. Read more

iPiD - Singapore based payments identity company raised $5.3m in Seed funding led by Monk's Hill Ventures. Read more

Kanastra - Brazil based provider of back-office tech for private credit funds and securitizations raised $21m in Series A funding led by Kaszek. Read more

Liminal - Denver based AI data security company raised $5m in Seed funding led by Fin Capital. Read more

M^0 - Switzerland based decentralized stablecoin minting protocol raised $35m in Series A funding led by Bain Capital Crypto. Read more

Mint Blockchain - Los Angeles based ethereum L2 network raised $5m in Seed funding led by Jsquare. Read more

Nium - San Francisco and Singapore based cross-border payments company raised $50m in Series E funding. Read more

Re:cap - Germany based financing and data insights company raised $14.6m in Series A funding led by Entrée Capital. Read more

Sibill - Milan based SMB payments company raised €6.2m in Series A funding led by Keen Venture Partners. Read more

SiFi - Riyadh based spend management company raised $10m in Seed funding led by the Public Investment Fund. Read more

Sipay - Turkey based payments and wallet services company raised $15m in Series A funding led by Anfa. Read more

Sixfold - New York based startup using generative AI to underwrite insurance raised $15m in Series A funding led by Salesforce Ventures. Read more

Slip - U.K. based receipt insights company raised £2.5m in new funding led by Adjuvo. Read more

Torpago - California based commercial credit card and spend management provider raised $10m in Series B funding led by Priority Tech Ventures and EJF Ventures. Read more

Understory - Madison based climate insurtech startup raised $15m in Series A funding led by True Ventures and Prelude Ventures. Read more

XREX Group - Taiwan based cryptocurrency exchange raised $18.8m in new funding led by Tether. Read more


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