Tag: money

Paying With Your Phone

On February 23, 2018

Cashless payment alternatives are increasing in popularity, and there are no signs that it will stop. One big breakthrough is the ability to pay with only your phone, through Apple Pay, Android Pay, or the soon-to-be Google Pay. There are definite pros and cons to paying with your phone, for both convenience and security reasons. Let’s look at some of the biggest.

Pro: Forgot your card? No problem.

We’ve all had that moment where we could have sworn we brought our wallet, or that we put our card away, but we can’t find it. Although it is stressful to lose a card or to not know where your wallet is, paying with your phone can, at the very least, get you out of a sticky situation. Luckily, many stores and restaurants are beginning to accept mobile payments, so you may be in luck next time you have no alternative.

Con: Hackers can steal your data.

While companies like Google and Apple have high-end security, hackers have been able to exploit even the most obscure security flaws to steal your information. With Apple Pay, for example, you store your complete card information on your phone. Hackers have to be extremely skilled to get this info, but it is not impossible.

Pro: Less time in drive-thrus.

Many fast-food chains are implementing mobile payments to reduce wait time and add convenience. Think of the last time you went through a drive-thru. From the time you place your order to the time you have to pay, you have to worry about not holding up a line while searching for a way to pay. Using your phone simplifies this process, as we often have our phones in easily accessible places, while our money may be located somewhere not so convenient.

Con: Processing times can lengthen.

Even though you may not hold up a line by looking for money, you may hold it up due to long processing times. Devices that are meant to read your phone are slow and sometimes can’t detect anything. You may spend twice as long paying via phone instead of paying the old-fashioned way.

Mobile payments are likely going to become standard in the next few years. However, in order to make them efficient and safe, bank institutions, phone manufacturers, and device reader companies need to consider both the good and bad things about this process and change accordingly. Once that happens, you may be hard-pressed to find a place that does not accept a mobile payment.

Altcoins That Are Worth Your Attention

By Jacob Parker-Bowles

On December 22, 2017

In FinTech, Jacob Parker-Bowles

When the average person thinks of cryptocurrency, they likely think of Bitcoin. Not only is it the most popular, it is also the most expensive, and some say the most volatile. While most cryptocurrency are tied to Bitcoin, either by using similar code to create it or simply through the market, each coin has its own distinct use and purpose. I suspect that in the future, a few altcoins will rise above the rest and will stay. Although I think everyone should put many hours of research into anything they invest in, here are some interesting altcoins to keep your eye on.

Litecoin

Litecoin is, in its basest form, a copy of Bitcoin. However, Litecoin comes with some distinct advantages that set it apart. It has a limited number of coins, just like Bitcoin, but it is larger at 84 million versus Bitcoin’s 21 million. It also processes transactions 4x faster than Bitcoin (with an average time of 2.5 minutes), and allows for better technology to be implemented. This has resulted in lower waiting times for transactions, as well as lowered fees. Finally, Litecoin is more fair to miners when they are rewarded.

Another reason Litecoin is a great altcoin to watch is it is easily accessible for even the most tech-illiterate. You can quickly buy Litecoin on Coinbase, which also offers a Litecoin wallet. Also, Litecoin is tremendously less expensive than Bitcoin, coming in at a few hundred dollars, rather than several thousand. While I cannot suggest anyone go and buy Litecoin, I think it is an altcoin that is worth watching out for.

Ripple

Another altcoin making waves is Ripple. Many people looking to exchange currency are doing so through Ripple. The currency itself has a built-in way to switch currency instantly. For example, people looking to travel may use Ripple, because they can convert from their country’s currency into their destination’s.

Likewise, banks are interested in Ripple for these reasons. It becomes much faster and less expensive to exchange currency through Ripple, rather than the traditional way. This is a bonus to both the bank and the consumer, as rates to transfer are significantly lower. Furthermore, Ripple can be a benefit to overseas merchants, and may eliminate excess fees for foreign buyers. This one factor is why I think we can expect to see Ripple adopted on a broader level than Bitcoin or Litecoin.

Monero

One benefit of cryptocurrencies on the whole are their anonymity. However, none is safer than Monero, which claims to provide complete discretion with your transactions. Because Monero is completely decentralized, you are 100% in control of your money, and if you lose it, there is no way to get it back.

Due to the nature of Monero, it is used heavily by criminals. While I do not condone criminal activities, I would be foolish not to recognize that this cryptocurrency has staying power for this reason. Also, many celebrities and companies are offering discounts to anyone who makes a purchase using Monero. I have mixed feelings about Monero, however, I will continue to watch it and see what happens next.

As I’ve said previously, I cannot and will not give you advice on how to invest in cryptocurrency. However, these three altcoins are becoming quite popular, and anyone interested in the options available may want to watch what happens to them. I believe that altcoins, just like Bitcoin, are going to become even more mainstream, and we will likely see more great altcoins join in the future. For now, we will have to watch the market and the news carefully before deciding where to place our money.

The Cashless Trend

By Jacob Parker-Bowles

On November 22, 2017

In FinTech

Every day, society is making moves toward becoming more cashless. It started with the wave of debit cards and credit cards making it less necessary to carry cash. Now, with the rise of cryptocurrencies, Apple/Android Pay, and other fintech services, carrying cash on you seems to pose more risk than reward. Today, I want to break down what society will look like as the world continues to adopt cashless options and moves away from paper money.

To begin, let’s look at cryptocurrency. Bitcoin is an example of a desire for anonymous, neutral money. By this, I mean people like being able to go anywhere and use their money without having to worry about foreign exchange rates and understanding how foreign currency works. Now that countries are more readily utilizing Bitcoin, at least in major cities, people don’t have to worry as much about preparing for their next trip.

Speaking of trips, we make trips regularly, whether it’s to a corner store or across the sea to another country. Going cashless would make traveling so much easier. There are still many cities (particularly in the USA) where buses and subway trains only take exact cash. Consider how many people would rather pay with a card or their phone, rather than having to count out dollars and cents, and overpaying if they don’t have the exact change. Luckily, many European countries are adapting to the cashless wishes of their citizens. One stellar example is the London Underground. Oyster cards are easy to use for residents and tourists alike, and I expect to see most countries utilizing similar technology in the years to come.

Restaurants and businesses also gain huge benefits from running cashless. While gas stations may be easily robbed now, in a few years they may not accept cash anymore, which can lead to a decrease in robberies. Sure, companies who run strictly cashless need to invest in cyber security to prevent hackers from exploiting their faults, but guarding against hackers is a much safer situation than guarding against men with guns.

One area that I imagine could easily move cashless is utilities. Many people (perhaps most) pay for their utilities online in some capacity. Nobody sends real money, and older people are the ones most likely to write a physical check. I don’t necessarily expect companies to begin accepting Bitcoin immediately, but I do believe there will come a point where they refuse to take a paper check as payment.

Of course, all of this leads up to banking. Banking is going to be one of the most rapidly evolving fields over the next decade or two. Traditional banks will begin shutting down as customers flock to online banks, where interest rates on savings and checking accounts are substantially higher. It is also predicted that AI will automate many financial services, making physical locations with real people irrelevant. Also, if cryptocurrencies keep their upward momentum going, there may be no need for a bank, traditional or online.

The next few years will be interesting, given the rise of so many fintech companies. Old systems are sure to be phased out, and I predict that the landscape of finance is going to change drastically. For now, we have to wait and see what the newest technologies will bring.

A Cashless Society is Closer Than You Think

By Jacob Parker-Bowles

On October 18, 2017

In FinTech, Jacob Parker-Bowles, Uncategorized

As the online marketplace and the prevalence of innovative payment systems increases, the amount of people utilizing physical money is decreasing. Every day, more people are gaining access to credit cards, Apple Pay, and cryptocurrency. It’s no wonder that industry thought leaders are debating if the end is near — for cash, that is.

Why is cash inferior?

Cash is inferior for many reasons. Sure, you have the physical aspect of knowing where your money is, but that’s where the perks end. When using money, you have to physically carry around the notes and change, as well as spend the time counting it out, and the ability to misplace it. On top of that, carrying physical money is less safe than carrying plastic cards. Don’t believe me? Although someone carrying cash has the same chance of being robbed as someone carrying only credit cards, cash is much more difficult to recover, and cards can be shut down almost instantly.

What are some alternatives?

More people in the UK are using cashless forms of payment than money, as of 2015. Naturally, the most common option is a debit or credit card. There are the old swipe-only cards that are being phased out, and many card companies are moving from chip cards to contactless.

On the other hand, Apple Pay and Android Pay are becoming more common each day, with smartphone users increasingly accepting the use of their devices for payment.

Another form of payment is cryptocurrency. This provides an anonymous way to pay for items online, and is taking off as a popular option for people who need to transfer money to other countries. Although it may be years until we see cryptocurrency accepted in brick-and-mortar stores, it still has the ability to reach that point in the future.

What would this mean for banks?

Banks are frequently targeted, due to large funds being available at any given time. If countries phased out physical money, bank heists would almost certainly cease to exist, and more energy could be put toward cyber security. Although criminals would attempt to find ways around this new system, it would be much more difficult.

Another change could be with the older generation. Investing time and resources into informing older clients of changes could be a nightmare for banks. Yet, with the government’s help, there would be ways to avoid the influx of concerned elders.

Where will cash go extinct first?

As it’s only a matter of time before cash is no more, let’s take a look at who might be the first cashless society. Sweden is the clear frontrunner, as their cash transactions make up a mere 3% of total sales. Three of four large Swedish banks are done handling cash in branches, and apps like Swish are providing instant bank transfers between several Swedish banks. This tech boom sets Sweden apart from the rest of the world, who want to join, but are afraid of citizens’ backlash.

Cashless societies are likely not going to be the norm for at least another decade, but once one country starts, it is likely that others will follow. In a few short years, you may never see a single banknote again.

How Retailers Are Retaining Relevancy

By Jacob Parker-Bowles

On June 7, 2017

In FinTech, Jacob Parker-Bowles

It’s not hard to spot the decline in brick-and-mortar stores. If you were alive in the 90s, you probably remember lounging with a book and listening to the CDs in Borders, testing out the gadgets in Sharper Image, checking out the flat-screen TVs at H.H. Gregg, picking out your next VHS for movie night at Blockbuster, and trying on sneakers at Sports Authority. None of these stores exist today. Even shopping malls are gradually becoming obsolete, with many closing a vast majority of their retail stores and becoming these cavernous, eerie ghost towns.

As more and more retail stores switch to e-commerce only or become acquired by other retailers, the ones left standing will have to get creative and come up with ways to retain their relevance in a tech-dominated world where 79 percent of U.S. consumers shopping online and 42 percent ranking convenience as an important factor for shopping online versus traveling to a store, according to a study from Pew Research. Online shopping grew at a rate of 12% year-over-year since 2009 compared to 4.5% for retail sales according to the U.S. Census Bureau’s monthly retail report.

When technology is the name of the game, the most logical thing retailers could do is utilize it to appeal to a tech-driven society- and that is exactly what some retailers are starting to do. According to leading technology research and consulting firm, Gartner, “traditional stores will have a place in the future with a new model that will blend the digital with the physical.” Enter, artificial intelligence (AI).

Artificial intelligence is the use of machines to perform tasks that normally require human intelligence. AI has both amazing potential and also some concerning implications- if we continue to outsource human tasks to robots, will we reach a day when there is no longer the need for human labor? Thankfully, that day has not yet arrived, and maybe it never well. AI is just starting to manifest in the form of personal assistants like Amazon Echo and Google Home.

One of the ways brick-and-mortar retailers are competing with online retail is by collecting customer data through video surveillance. Online vendors have always had an advantage over physical retailers in combatting cybercrime in that they store all of their customers’ data. Now, facial recognition technology and floor-level cameras allow retailers to predict the age and gender of customers and even analyze customer reactions to products. Retailers like Walmart and IBM are already implementing this technology.

Another way retailers are employing data and AI to stay on the cutting edge is through in-store help. Target plans to equip all associates with technology that will enable them to deliver superior customer service by searching inventory across the company, setting up shipping, and taking payment from the customer mobly. Lowes is taking it one step further by launching robots to assist customers on the floor, keep track of inventory, and analyze shopping patterns.

A final way retailers can take advantage of AI is by leveraging the internet to obtain key data about customers and make their shopping experience more personalized. By monitoring trends among shoppers, retailers will have a better idea of what to sell and how to attract customers.

Technology ultimately encroaches upon every corner of human life, albeit at a slower place in some parts of the world, and it is the difference between institutions that succeed and those that fail.

Deceptively Dark Money: The Hidden Dangers of Dark Money

By Jacob Parker-Bowles

On February 22, 2017

In FinTech, Jacob Parker-Bowles

Unless you’re involved in the financial industry or politics, then you may have no idea what dark money even is, but you’ve probably heard the term tossed around by politicians and the media. It sounds like something shady and mysterious that could get the owner into trouble, and that is pretty much exactly what it is. However, dark money transactions occur all the time and government officials do nothing to stop it. And why would they? Dark money, since gaining traction in the United States during the 2010 midterm election, fuels elections, playing such a large role in the campaigns of political figures that it would be futile to try to reverse its existence.

I should probably explain what dark money actually is before getting into why it’s so dangerous and its power to influence elections. Dark money is essentially just money that is donated to nonprofit organizations or super PACs (political action committees) from various undisclosed donors to influence the decisions of voters in elections, mainly in the form of political advertisements- so if you’ve ever seen one of those propagandistic political commercials that seem to play on an endless loop around the time of elections, then you’ve no doubt witnessed the products of dark money.

The use of dark money to influence elections has taken off exponentially in just the few years it has been in use. According to the Center for Responsive Politics, spending from nonprofit organizations that do not disclose their donors has increased from $5.2 million in the 2006 election to $300 million in the 2012 presidential elections and $174 million in the 2014 midterm elections. In the most recent election period, political organizations outside of official party/campaign groups spent over $15 million in 2015 alone and only reported $5 million to the Federal Election Commission (FEC).

There is debate over just how much dark money influenced President Trump’s campaign, with Andy Kroll citing in an article for Mother Jones that while Trump initially denounced donations from outside groups to fund his campaign, he ultimately raised more than $300 million from wealthy and small-dollar donors, lobbyists, and businesses, which he used to pay consultants, pollsters, fundraisers, and ad makers to run the promotional end of his campaign. Additionally, according to Kroll, he received more than $100 million in anonymous support from dark money groups.

Whether or not these statistics are entirely factual is beside the point. It’s clear that dark money has come to play a large role in elections. Undisclosed funds are indisputably shady transactions, yet there are generally two camps when it comes to dark money, which helps to explain why this practice isn’t going anywhere anytime soon.

Campaign finance reform activists

While many people outside of politics or finance may feel uncomfortable about dark money, there are those who are staunchly against it. Campaign finance reform activists, encompassing groups such as Democracy 21 and the Campaign Legal Center, argue that voters have the right to be informed of who is funding political campaigns. According to the Center for Public Integrity, “Such information, they assert, is essential to voters’ ability to evaluate the merits of political messages- and to know if certain special interests may be trying to curry favor with politicians.”

Supporters of anonymity in politics

Then there are those that defend dark money, those that support anonymity in politics and assert that founding documents such as The Federalist Papers and Thomas Paine’s Common Sense were published anonymously. The Center for Competitive Politics argues that the threat of dark money is “overblown” and “disclosure comes with a cause,” meaning donors have the right to remain anonymous to avoid harassment or negative press.

As these views demonstrate, there are two sides to every story. However, the risks associated with dark money cannot be ignored, and its influence in political elections is undeniable.