Contactless ecosystem & Collective Oligarchy [Sept'20 edition]
Bundling & Loyalty points
September passed by in a blur, with the advent of chilly weather and ‘laxing behaviors around social distancing and sanitizing. However harsh, mentally-taxing climes bring about a spur in innovation and the payments industry was no different in this weather.
Top Trends in Sept
Some top trends we saw in the market out there -
Contactless ecosystem / infrastructure - Players are still in the midst of solving the last mile problems of a contact-less infrastructure for merchants and retailers. PayPal launched their POS platform to support food and drinks services in the UK - it allows merchants to charge customers by sending a payment link via SMS, Whatsapp, email or social media. We also had a contactless biometric payment card from Thales, an all-in-one payment solution from Moneris, a new ‘pay tab while dining’ experience by Uber Eats to eliminate the use of bill holders, credit cards and pens, a contact-less QR solution from Square and last but not the least, a payments solution using your palms (!) with AmazonOne.
Subscription bundled models - FIS launched a bundled subscription based model for core banking services, similar to Apple’s all-in-one bundle play for all things Apple.
Cards as a gateway to software - if you’ve noticed around you, almost all neo-banks, fintechs, ecommerce giants and tech companies are issuing credit cards with the end goal of competing with a bank, however AirBase has created a SaaS suite of financial tooling to support corporate accounting departments and employees, in addition to offering corporate credit cards. Hence interchange income is their secondary source of income, as compared to their primary value proposition of B2B SaaS solutions.
Virtual cards - We had a different type of credit card with X1 (ends free trials automatically, cancels subscriptions, allows you to spend anonymously and more!). And we saw a long-awaited partnership between 1Password and Privacy.com - to enable secure payments through virtual cards + easy accessibility of cards & passwords.
Loyalty points & rewards as Tradeable assets - JP Morgan has changed the narrative on what constitutes a tradeable asset and sports fans can now earn interest on their season tickets. The rise of Tokenized economy means anything can be a payment now - anything of value that can be exchanged through a network, from data to ideas. Looking forward to the day when my data can be a tradeable asset.
Anyone can be a Merchant now - there’s an emergence of new small/individual businesses operating from home. Anyone who accepts payments via mobile, from a mom-and-pop store to a busker in the underground is a merchant.
Going Public...
Veering a bit away from the payments and innovation talk, September also saw a few shiny public listings -
Palantir (PLTR) - The controversial data intelligence company went public through a Direct Listing this fall. I’ve my bets on Palantir albeit with its mired ethical controversies - large commercial and government contracts, being at the right place at the right time (data insights for the most critical challenges - counter-terrorism, human trafficking and disaster response) and a very strong tech stack.
Snowflake (SNOW)- the biggest software IPO (ever) took off to a great start in Sept. FYI, Snowflake helps blue chip companies analyze and share data in the cloud and is backed by Salesforce (CRM) and Warren Buffett's Berkshire Hathaway (BRKB).
Collective Oligarchy
On a more philosophical note..
One of the books on my bedside table has been 1984 which has George Orwell predict an utopian society between the realms of dictatorship, communism and socialism; where every citizen is monitored for their thoughts, actions, behaviors, mannerisms, facial expressions, nervous tics and more (sound familiar?). Your life is governed constantly by ‘Big Brother’, in other words, ‘the Party’ that hones & influences your mental capacity towards one aim in particular - utter devotion to the Party and the country.
Wealth and privilege are the most easily defended when they’re possessed jointly. Hence Collective Oligarchy in 1984 has property concentrated in the hands of a few; the new owners are a group (‘the Party’) instead of a mass of individuals.
With the oncoming threat of data harvesting, monitoring and exploitation, can we trust the big tech companies to NOT form collective oligarchy in the future, against the proletariat (ordinary citizens)?
People want control of their data (and thoughts), without influence, without direct/indirect exploitation. Would a distributed monetary and individual data framework gain traction in the future?
Did you like this snapshot of the underlying shifts & currents brewing in the Payment, Cards & Innovation space? If you found this useful, feel free to comment, share and subscribe.