Will Uber become the place where you don’t just get a ride, but also buy shoes, groceries, and anything else you need? The rideshare company is betting on exactly that as it rolls out a sweeping expansion of its app into shopping and other digital services, and expands its partnership with payment technology provider Block Inc.

Uber introduced the new platform, calling it “one app for everything,” at its annual Go-Get Conference. According to CEO Dara Khosrowshahi, the “Where to?” bar in Uber’s app now returns results for places, food, and consumer items. A new “Shop for Me” feature allows users to request items from any store and have an Uber driver pick up and deliver them.

The model builds on an Uber Eats feature introduced in 2023 that lets delivery drivers shop for grocery items in-store before delivering them to customers.

As Seamless As Possible

The unstated premise is that Uber needs to strengthen its position to compete with DoorDash, which has been expanding beyond restaurant delivery into local retail purchases. Uber, however, is going further by enabling users to arrange delivery from virtually any merchant—even those not listed in the Uber or Uber Eats apps.

“This is a strategic move by Uber and helps users who are already struggling with app overload by connecting the dots and making related tasks as seamless as possible,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research.  

Relying on Block’s Technology

Uber announced a major expansion of its global partnership with Block last month, including the international rollout of a new Uber Eats integrated payment service in Canada, Australia, and several European countries. In the U.S., Block helped extend Cash App Pay as a new payment option across Uber’s platforms. Uber says it could not have rolled out the new shopping features without Block’s expertise.

“This is very complex from a payments perspective,” said Apgar. “When you order from a listed merchant, either through Uber Eats or DoorDash, the platform parses the billing and settlement to ensure the driver and merchant are paid correctly. For off-platform purchases, the Uber driver actually makes the purchase on behalf of the user, so driver reimbursement and reconciliation add a new layer of complexity to the payments stack.”

“This really raises the bar in terms of what users can expect,” he said. “It also highlights Block’s capabilities in solving complex constructs like this.”

The post Uber Turns Its App into a Personal Shopping Service appeared first on PaymentsJournal.

The European Union is preparing to raise the stakes for open banking. With the Third Payment Services Directive (PSD3) and its accompanying Payment Services Regulation (PSR) moving through final approval stages, the bloc is edging closer to its most significant payments overhaul since PSD2.

EU lawmakers have published their final compromise texts for the proposals, suggesting that major political negotiation is largely complete. The next steps are formal approval by the Council of the European Union and the European Parliament, after which the rules will go into effect 20 days later.

At its core, open banking is built on the relationships between banks and third-party providers—fintechs and partners that enable the modern digital banking ecosystem through application programming interfaces (APIs).

Therefore, it makes sense that a key emphasis of the new framework is strengthening the rules governing these partnerships. For example, under PSD3 and the PSR, banks and third-party providers will need to ensure that APIs are secure and that all participating firms are appropriately authorized or licensed.

Tightening Fraud Controls

Another major focus of the legislation is fraud prevention. Fraud has become a global threat as  payments have accelerated and cybercriminals have become more savvy. To this end, the PSR introduces stricter transaction monitoring requirements, including real-time checks for instant payments.

The regulations also set higher standards for identity verification. For example, payment service providers will be required to verify that the recipient’s name matches the account identifier before initiating a transfer. Additionally, the framework implements enhanced customer authentication rules, clarifying when step-up security measures must be applied.

A More Unified Regulatory Approach

The overarching message of the new rules is that while open banking delivers benefits, its high degree of interconnectivity also introduces new risks. PSD3 and the PSR represent a more targeted evolution of the regulatory framework, aiming to close gaps identified in earlier iterations of the Payments Service Directive.

Responsibilities are more clearly divided. PSD3 will primarily address licensing and supervisory arrangements, while the PSR will set directly applicable conduct and operational requirements across EU member nations. This separation is designed to reduce the inconsistencies in implementation that emerged under PSD2.

Ultimately, the goal of PSD3 and the PSR is to create a more secure and harmonized open banking environment across the EU. Once adopted, financial services firms are expected to comply with the new requirements within 27 months of the rules entering into force.

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After considering launching a stablecoin of its own, Meta is opting to leverage established digital asset infrastructure to enable stablecoin payouts.

Through a partnership with Stripe, Meta will now offer some creators the option to receive payouts in Circle’s USDC. These payments can be received through most crypto wallets, including MetaMask, Phantom, and Binance, across the Solana or Polygon blockchains.

“This is big news—they’re turning stablecoins into a payout mechanism at massive scale,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “Creators can now get paid directly into wallets on various blockchains and bypass cross-border delays and fees. This is a big deal because Meta and Facebook have such a massive client base, and USDC and Stripe matter here because they offer enterprise-grade, compliant, and low-risk options.”

Shifting Toward Infrastructure

Meta’s shift away from issuing a proprietary stablecoin is also notable. Years ago, the company explored a branded stablecoin initiative called Libra, later renamed Diem. However, the project faced regulatory and funding challenges and was subsequently shelved.

Following the passage of the GENIUS Act last year, a growing number of companies have announced plans to issue stablecoins—the latest being Western Union. After Meta unveiled its renewed interest in stablecoin-related payments, there was speculation that the company—whose platforms include Instagram, Facebook, and WhatsApp and collectively reach roughly 3 billion users—might revive plans for its own token.

All About Distribution

Launching a propriety stablecoin could dramatically reduce the fees Meta pays to third-party issuers and intermediaries, but remaining on the sidelines of issuance may come with its own costs.

By adding stablecoin support, even through partner infrastructure, Meta could further embed itself in the surging social commerce space, while also positioning itself as a potential competitor in financial services over time.

For example, WhatsApp is already widely used for cross-border payments and remittances. Introducing stablecoin functionality could materially reduce transaction and currency conversion fees for users.

“All of this is about distribution,” Hugentobler said. “In a sense, they’re testing whether stablecoins can power global payroll across its platform with billions of users. If they can prove this out, it will put pressure on banks and traditional payment providers in the areas it is executing on: cross-border payments, payouts, remittances, and even FX.”

The post Meta Brings Stablecoin Payouts to a Massive Global Ecosystem appeared first on PaymentsJournal.

In a move to promote interoperable standards for agentic commerce, Google is donating its Agent Payments Protocol (AP2) to the nonprofit industry group the FIDO Alliance, which is working on open frameworks for agentic interactions. While framed as an altruistic step, the decision also helps ensure Google remains deeply embedded in this emerging space.

Google also announced a new version of AP2 with the support for “human not present” payments, enabling agents to autonomously execute transactions based on pre-authorized user instructions—such as buying concert tickets the moment they go on sale. To ensure those actions remain accountable, the company, in collaboration with Mastercard, introduced Verifiable Intent, an AP2-compatible standard that creates a tamper-proof record of user-approved agent activity. This standard is also being contributed to the FIDO Alliance.

These contributions position Google’s technology as a building block for future agentic developments—a move some observers described as characteristic of the company’s long-term strategy. Christopher Miller, Lead Analyst of Emerging Payments at Javelin Strategy & Research, calls the move “classic Google.”

“These ‘donations’ are part of the business plan by incumbents to remain relevant,” Miller said. “Make it free and cement their engagement. ‘You can all now build on this thing we developed.’”

Who Is FIDO?

Founded in 2021, the FIDO Alliance initially set out to replace password-based authentication with phishing-resistant protocols tied to user devices. It’s now expanding its scope through an Agentic Authentication Technical Working Group, focused on specifications for agent-initiated commerce, alongside a Payments Technical Working Group chaired by Mastercard and Visa.

FIDO’s efforts will center on agent authentication, ensuring actions are performed on behalf of legitimate users, as well as trusted delegation frameworks that keep transactions within user-approved parameters.

Google’s Agentic Ambitions

Google has made steadily advancing its role in agentic commerce. In January, it unveiled the Universal Commerce Protocol (UCP), an initiative designed to let AI agents manage the entire shopping journey from discovery to checkout.

Developed with partners including Shopify, Etsy, Wayfair, and Target, UCP features a streamlined checkout experience that allows users to complete purchases directly within Google’s AI Mode.

The post Google Donates Its Agentic Payments Protocol to the FIDO Alliance appeared first on PaymentsJournal.

Tourists traveling to Japan will soon have a simpler way to get around—a prepaid transit card designed specifically for short-term visitors.

Pasmo Co, which issues cards for Tokyo’s widely used train system, will introduce the new card, valid for 28 days and accepted for cashless payments across the country.

Tourist Pasmo will be available at vending machines and ticket offices in major transportation hubs, including Tokyo’s two main airports. It enables tap-and-go travel across public transportation networks, as well as payments at many shops and vending systems. It can be recharged during the 28-day period, though any remaining balance is nonrefundable.

Pricing varies by airport. At Narita Airport, the card costs a flat 2,000 yen. At Haneda Airport, travelers can load between 1,000 yen and 10,000 yen at purchase.

Travel Is the Sweet Spot

The card is especially useful for first-time visitors navigating Japan’s extensive—and sometimes confusing—transit system. It simplifies access to trains, subways, and buses, reducing fare confusion and speeding up travel.

“At Javelin, we see a lot of trends in self-use of prepaid cards, and a plan like this matches several of the key reasons why individuals buy prepaid cards for personal use: convenience, budgeting and safety,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “We also found that 25% of prepaid users do so to pay for expenses while traveling. By embracing these trends, this becomes a really novel approach to ease the burdens of travel and currency conversion.”

Hirschfield said he is not aware of other countries taking such a direct approach to prepaid travel tourist transit cards. Pasmo previously offered a similar product, Pasmo Passport, which was discontinued in 2024.

A Souvenir of Japan

Pasmo also hopes travelers will keep the card as a souvenir.

East Japan Railway offers a more limited alternative, Welcome Suica, which focuses on eastern Japan, and is available only on iPhone, not on Android devices.

The post Japan Issues New Prepaid Cards Exclusively for Tourists appeared first on PaymentsJournal.

Smaller enterprises are hitting a critical turning point. As long-time owners near retirement, many are looking to exit, but potential buyers are often held back by one persistent issue—outdated systems, especially in payments infrastructure.

According to data from Zelle, nearly half of small business owners over 50 have no exit plan in place, and roughly 41% said they would shut down if they can’t find a buyer.

However, fewer than a third of these owners report that their businesses are fully modernized, which can be a major barrier for prospective buyers—often younger adults who expect a sleek, digital-first experience. Payments, in particular, are a key concern. Approximately 88% of respondents said faster payments are critical to mitigating risk during the first year of operations.

Non-Negotiable Optionality

It is difficult to overstate the importance of a digitally driven business model for younger demographics. This preference has also fueled an evolution in financial services, where mobile and online banking have become the primary ways younger users engage with their banks. Gen Z and millennial business owners are also more open to using AI to support their banking experience—but not for major business decisions.

Another hallmark of this digital shift is an expectation of choice in nearly every aspect of business—from banking relationships to supplier selection. This expectation is even more pronounced in payments, where the rapid proliferation of payment types in recent years has driven demand for real-time payments and acceptance of digital assets.

The Zelle study found that this optionality has become non-negotiable, with more than two-thirds of respondents saying outdated payment options could derail a business deal entirely.

Heating Up the Competition

All these factors are reshaping the small business landscape, though it remains unclear whether the sector will evolve quickly enough to remain attractive to younger buyers. If not, millions of businesses could ultimately shutter as owners retire without a buyer in place.

Fortunately, business owners today have more tools than ever to modernize operations, including payments infrastructure. Much of this progress has been driven by fintechs emerging as key players in the small business space. As more owners approach retirement and look to increase buyer appeal, competition among providers is likely to intensify further.

The post Payments have Become a Make-or-Break Facet of Small Businesses appeared first on PaymentsJournal.

Anthropic sparked alarm after announcing that its Mythos model had uncovered widespread vulnerabilities across the financial sector, prompting Japan to launch a consortium to address what officials describe as “a crisis already at hand.”

Earlier this month, Anthropic said a preview of Mythos ​identified thousands of critical vulnerabilities spanning all major operating systems ​and web browsers in financial services.

In the wrong hands, a model like Mythos could exploit previously unknown weaknesses faster than organizations can patch them, potentially triggering severe global consequences.

“AI risks and Quantum Day concerns have put cyber teams on high alert, as the acceleration of both AI and quantum computing pose yet-to-be-identified cyber threats to existing structural architectures based on cloud models and encryption algorithms designed to protect sensitive data,” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research.

“Mythos has uncovered vulnerabilities that have not yet—to our knowledge—been exploited,” she said. “But all these warnings fall under the basic cybersecurity adage, it’s not a question of ‘if’ but ‘when.’”

Restricted Release

Concerns escalated after Anthropic stated that Mythos is too dangerous for broad release. The company has made the model available only to the U.S. government and a select group of American organizations, a decision that has raised concerns the technology could become a form of geopolitical leverage.

There is also growing anxiety that a leak or cyberattack could place Mythos’s capabilities in the hands of malicious actors. These fears intensified after Anthropic disclosed that its next-generation Capybara models were leaked due to human error.

Proactive and Self-Governing

In response, Japan is forming a task force that will include the Financial ​Services Agency, the Bank of Japan, the National ​Cybersecurity Office, the country’s three largest banks, and the ⁠Japan Exchange Group.

Officials say urgent action is needed because the financial sector’s high level of interconnectedness and reliance on real-time systems amplifies systemic risk. Another concern is that many banks continue to rely on legacy infrastructure, leaving them especially vulnerable and unlikely to modernize until it is too late.

“Sadly, the financial services infrastructure—for as sophisticated as it is—relies on not only antiquated architecture and systems but also antiquated ways of addressing risk,” Goldberg said. “Banks cannot wait for regulators and auditors to tell them what to do. They need to be proactive and self-governing. But, sadly, we’re likely to see something catastrophic before any banks start to take AI cyber risks and Quantum Day predictions seriously.”

The post Japan Assembles Task Force to Assess AI’s Financial Services Risks appeared first on PaymentsJournal.

The digital euro has taken a major step toward launch, as European policymakers push to reduce reliance on foreign payment networks and regain control over how money moves across the bloc.

New agreements between the European Central Bank and three standards bodies aim to ensure payments are processed smoothly and uniformly across the EU, keeping the project on track for testing in 2027 and a potential rollout in 2029. 

The move addresses a key gap. Europe currently lacks a universally available open standard across payment terminals. The EU’s existing payments ecosystem relies heavily on proprietary systems operated by international card networks and global digital wallets. By building on established European standards, policymakers hope to accelerate adoption while creating a more uniform experience for both users and merchants handling the digital euro.

Standards for Tap-to-Pay and Cash Machines

The ECB plans to build on several existing open technical standards to support the digital euro’s functionality.

These include CPACE, developed by the European Card Payment Cooperation, for secure contactless tap‑to‑pay transactions via near‑field communication; Nexo standards, which link merchants’ systems with payment service providers (PSPs) and acquirers to enable payment acceptance and ATM transactions; and the Berlin Group’s framework, which allow payments using aliases such as mobile phone numbers and supports use cases like merchant apps on smartphones.

By relying on these frameworks, the ECB aims to minimize implementation costs and encourage coordination among payment providers. It has also begun testing the digital euro’s technical and operational readiness, with PSPs participating in a pilot phase.

Is 2029 Still Realistic?

The digital euro’s path has been marked by delays since its initial announcement in 2020. Originally designed as a counterweight to the growing influence of foreign currencies and global payment networks such as Visa and Mastercard, it now also faces competition from stablecoins, which have increasingly taken on the role in cross-border payments that the digital euro was intended to fill.

While incremental progress continues, questions remain over whether the project will meet its timeline—or ultimately come to fruition at all.

“A 2029 launch is realistic on paper, but still contingent on the EU finalizing legal frameworks in 2026,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “Even if legislation passes this year, rollout depends on successful pilot testing. If the pilot goes well, then it’s a matter of adoption by banks and merchants.”

“A lot needs to happen,” he said. “This is progress, but not momentum yet. Until legislation and distribution are dialed in, 2029 is anything but a certainty.”

The post ECB Sets Payment Standards for Digital Euro Rollout appeared first on PaymentsJournal.

As economic pressures continue to price many prospective buyers out of homeownership, Fannie Mae and Freddie Mac are turning to new credit-scoring models in an effort to widen access to mortgages.

The two agencies—which guarantee ​most U.S. mortgages—will now accept loans evaluated using ⁠the VantageScore 4.0 model, which incorporates data such as rent and utility payments in addition to traditional credit information. The goal is to improve access to mortgages, enhance affordability, and foster a more competitive housing market.

However, the same economic challenges that have hindered homebuying also make accurately assessing creditworthiness imperative to protecting both consumers and lenders. Moving away from a tried-and-true model raises questions about potential risks in the years ahead.

“FICO scores set the gold standard for credit scoring, and their U.S. model has been used in all consumer collateral classes,” said Brian Riley, Director of Credit and Co-Head of Payments at Javelin Strategy & Research. “It has been tested in recessions and recovery environments for more than 40 years.”

“Lenders rely on the FICO score to manage risk from stem to stern,” he said. “These scores are used at the acquisition point, as a credit management tool, a retention tool, and even through capital markets for asset securitizations. It is a steady fact, more than 90% of credit card lenders rely on the FICO Score.”

Expanding Homeownership Access

While the importance of credit scores has not been widely disputed, some lenders have adjusted how they interpret them. For example, Fannie Mae and Freddie Mac have lowered their minimum 620 middle credit score requirement for certain home purchases and refinance loans.

The intent is to expand access to homeownership for borrowers with limited credit histories and to support “near-miss” applicants—those with sufficient income or cash reserves whose credit scores fall just below the 620 threshold.

The Best of Both Worlds

While there is broad agreement that challenges persist in the housing market, easing lending standards also carries risk if not carefully managed. As a result, a blended approach—combining traditional credit scoring with more current data on payments and debt behavior—is increasingly seen as essential.

“FICO Score 10T is an illustration of how FICO keeps its iconic scoring model relevant, as the mortgage industry requires tools that open access to borrowers who may be on the fringe,” Riley said. “The model includes trended data, such as rental payments and utilities, which will help issuers broaden access while keeping the credit score as a highly predictive risk management tool.”

The post Fannie Mae, Freddie Mac Embrace Alternative Credit Scoring appeared first on PaymentsJournal.

Just in time for Earth Day, CPI Card Group’s donation of 25,000 paper prepaid cards to Street Charity underscores a growing realization that simple, low-cost payment tools can expand access to aid while advancing sustainability efforts.

The initiative highlights an emerging use case for single-use gift cards that are both less expensive to produce and more environmentally conscious than traditional options. It also offers a practical way to support individuals in need who may not have access to virtual cards via a phone or other device.

The cards are built on the Discover Network Prepaid Cards platform and their use is limited to fast-food and quick-serve restaurants nationwide. This ensures that donations are directed toward meals rather than cash.

Street Charity supports crisis centers, shelters, and nonprofit partners serving individuals experiencing food insecurity.

Sustainability Goals

Paper-based alternatives to plastic are becoming a popular option across the industry, not just for charitable initiatives but also as part of broader sustainability efforts. Single-use prepaid cards are particularly well suited to paper, as don’t require the durability of traditional credit or debit cards intended for repeated use.

“The announcement from CPI underscores two main industry initiatives,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “First is the fact that physical cards are not going away, but instead are often complementary to digital products. Second is that the prepaid industry consistently works to reduce its impact on the environment through use of eco-friendly materials. It’s important for the entire ecosystem to accept both as goals in efforts to fulfil sustainability goals.”

Verifying the Chain of Custody

CPI has played an active role in these efforts. Since 2022, the company has produced nearly 100 million eco-focused paper payment cards.

The market is demanding greater transparency around sourcing. In response, CPI has earned certification through the Forest Stewardship Council’s Chain of Custody program. This certification ensures that wood-based materials are tracked from responsibly managed forests through to the final paper products, and that FSC-certified materials are properly identified or kept separate from non-certified inputs throughout the supply chain.

This trend is likely to accelerate. A CardRates.com survey conducted last year found that nearly 60% of Gen Z cardholders consider sustainability a top priority.

The post Paper Prepaid Cards Emerge as an Eco-Friendly Tool to Fight Hunger appeared first on PaymentsJournal.

Visa and TikTok are launching a new “creator card” aimed at fixing one of the biggest pain points in the creator economy: getting paid on time.

The debit card, initially rolling out in the UK, will allow creators to convert TikTok Live gifts into income and access funds more seamlessly through a dedicated business account.

“The partnership is all about getting creators their funds faster, which for a small business is critical to cash flow and money management,” said Ben Danner, Senior Debit Analyst at Javelin Strategy & Research. “The other upside is to keep business expenses separate from personal expenses, which are often intermingled as creators utilize their personal bank accounts for their TikTok businesses.” 

“Visa has increasingly leaned into supporting the growing creator economy in the past few years by providing solutions like Visa Direct and card solutions,” he said.

Prompted By the Phenomenon

The rapid rise of the creator economy phenomenon has pushed leading financial services players to strengthen the payments infrastructure supporting it. For example, PayPal recently launched a feature for Canva’s roughly 265 million users that enables them to design content and accept payments in one place.

Previously, many Canva users had to build separate websites or storefronts to process transactions—often at a significant cost. These payment challenges are widespread. In a study commissioned by Visa, nearly half of surveyed UK content creators said late or inconsistent payments negatively impacted their ability to run their business.

An Appealing Combination

While more financial services firms are working to solve these issues, TikTok is also expanding its financial footprint. In China, its sister platform has launched the Douyin Pay digital wallet to facilitate in-app transactions. TikTok has also applied for licenses in Brazil that would allow it to hold user funds and potentially offering lending services.

Through these efforts, TikTok is positioning itself at the intersection of social media, e-commerce, and fintech. This convergence is particularly compelling younger adults, an increasing number of whom are building businesses within the creator economy.

The post Visa and TikTok Unveil Debit Card for Social Commerce Payouts appeared first on PaymentsJournal.

As more regions prioritize payments sovereignty, France’s Cartes Bancaires (CB) network is working to reclaim some of the market share it has lost to Visa and Mastercard.

The nonprofit network was created in the 1980s as a joint venture among France’s leading banks. However, CB has seen its domestic market share decline from over 90% to roughly three-quarters of card payments. This shift is partly due to the reliability and global reach of Visa and Mastercard’s networks, and partly due to the rise of digital-first financial players.

CB head Philippe Laulanie recently told the Financial Times that the network’s position has stabilized and interest in CB is growing again. Not only does the payments network hope to regain traction in France, but it also hopes to play a leading role in the broader push for greater payments independence in Europe.

“Cartes Bancaires is the French bank network much like an Interlink or Maestro here in the U.S.,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Most of their cards are co-branded, meaning they can run over Visa and Mastercard rails or on the CB bank rails—again, just like in the US.  However, the market share for CB has been shrinking as new fintechs like Revolut and others have driven towards exclusive deals and single-network architecture.”

Challengers and Competitors

UK-based Revolut has experienced meteoric growth, becoming a global fintech phenomenon. The company has set ambitious goals, including reaching 100 million customers by 2027 and expanding into 30 new markets by 2030. Revolut recently announced plans to establish a Western Europe headquarters in Paris and signaled that it will apply for a banking license.

Alongside fintech challenger like Revolut, CB also faces competition from emerging payment rails like digital assets—including euro-backed stablecoins and potentially the digital euro—the bank-backed Wero digital wallet, and prospective Europe-wide real-time payment systems.

An Off-the Shelf Alternative

Many of these newer rails have gained favor because the EU is increasingly searching for ways to reduce reliance on foreign payment systems. U.S.-based infrastructure, led by Visa and Mastercard, currently processes over 60% of card transactions in Europe.

Given recent geopolitical tensions and ongoing uncertainty, EU leaders have called for changes to the region’s payments infrastructure. This could potentially create an opportunity for CB.

“The political climate is now flashing a yellow light about over-dependency on US-based Visa and Mastercard, with the EU central bank pushing to bring a new network online by 2030,” Apgar said. “CB is already built and operating and could be extended in other EU countries as an off-the-shelf alternative to Visa and Mastercard.”

The post France’s CB Payments Redoubles Efforts to Vie with Visa and Mastercard appeared first on PaymentsJournal.

The Bank for International Settlements (BIS) has raised new concerns about stablecoins, especially given that two issuers dominate the global supply. BIS General Manager Pablo Hernandez de Cos emphasized the need for stronger international coordination on regulation, warning that firms may gravitate toward jurisdictions with weaker rules.

He cautioned that inconsistent regulatory frameworks could ⁠lead to market fragmentation or regulatory arbitrage. Speaking in Japan, he also warned that stablecoin runs could trigger broader financial stress, though such risks might be reduced through mechanisms similar to deposit insurance or central bank liquidity support.

De Cos argued that major stablecoins—primarily issued by Tether and Circle, which together account for roughly 85% of the $315 billion market—behave more like securities than money, comparing them to ETFs. He noted that market concentration could introduce redemption frictions and distort asset valuations.

Many Reasons for Concern

The BIS has also been advocating for central bank digital currencies (CBDCs) as a potential alternative for cross-border payments, placing them in indirect competition with stablecoins.

“Three Nobel Prize-winning economists, Jean Tirole, Paul Krugman, and Simon Johnson, have all raised strong concerns that echo the ones raised here by the BIS,” said Hugh Thomas, Lead Analyst, Commercial and Enterprise at Javelin Strategy & Research.

To Thomas’ point, they broadly argue that stablecoins could be prone to run-like dynamics if confidence in their backing weakens, while shifting money-like functions into private hands without a clear public-interest case. They also warn that regulation may not be robust enough for the scale envisioned, that widespread adoption could create spillover risks for funding markets and financial stability, and that stablecoins open new channels for money to move outside the traditional banking system’s oversight.

Explorations of Its Own

BIS is increasingly focused on shaping the future architecture of global digital money and payments. As a coordinating platform for major central banks, it’s working to improve efficiency and interoperability of cross-border payment systems in a more digitized financial environment.

These efforts are closely tied to its broader concerns about the rapid growth of stablecoins and the risks they may pose if left unevenly regulated. By exploring how CBDCs could operate on a shared platform alongside private digital assets, the BIS is testing alternatives that could reduce reliance on dominant stablecoin issuers.

Its work on initiatives such as Project Agora, which examines how tokenized bank deposits might be used in cross-border payments, points to a potential future where regulated public and private money systems compete or coexist under tighter global coordination.

The post Why the BIS Is Worried About Stablecoins appeared first on PaymentsJournal.

The International Monetary Fund is urging banks to rethink a long-standing taboo in financial crime prevention—how much data they are willing to share with one another. In a new Technical Note, it argues that fragmented information is weakening the fight against AI-enabled fraud. combine data of their own, urging a shift in strategy toward sharing private information among financial institutions.

Released during the 2026 Spring Meetings of the IMF, the Technical Note focuses on how financial institutions can respond more proactively to digital fraud. The paper argues that efforts to combat such fraud have been hindered banks’ reluctance to share threat data, both domestically and internationally.

AI has become a boon for criminals, enabling them to aggregate vast amounts of data to fuel increasingly sophisticated attacks. In response, the IMF is urging banks to adopt a more collaborative approach—particularly by sharing more transactional and threat data cross institutions.

Importantly, the report cautions that new technology alone is not a silver bullet, warning against solutions deployed without clear use cases. Instead, it recommends robust data-sharing practices, especially around transaction records, to strengthen the collective ability of FIs to detect, prevent, and mitigate illicit finance activity.

More Data, More Value

AI and machine learning are highly effective at detecting transactional anomalies, but their performance depends on access to large, diverse datasets. When models operate in fragmented data environments, their insights are inherently limited. The Technical Note identifies these siloed data architectures as the primary obstacle in the fight against fraud.

By contrast, AI tools perform more effectively in integrated systems built on shared datasets, enabled by application programming interfaces (APIs) and common standards such as ISO 20022. The IMF highlights APIs, standardized data formats, and interoperability frameworks as essential to fostering meaningful data exchange across institutions.

Breaking Down the Silos

Banks have good reasons to resist data sharing, including competitive concerns and regulatory constraints. However, as fraud networks become more sophisticated and globally connected, greater transparency and collaboration could strengthen the financial system’s ability to detect and prevent illicit activity.

“Data sharing and collaboration is a long-standing issue within financial institutions, not even just between banks, but between lines of business within the same organization,” said Suzanne Sando, Lead Analyst of Fraud Management at Javelin Strategy & Research. “A financial institution may detect the signals needed to stop fraud on a customer’s credit card, but they may not be sharing the critical risk signals and emerging threat trends to stop fraud on that same customer’s debit account. These silos are preventing banks from accessing the critical data needed to keep up with fraudsters, especially as AI evolves and is adopted by fraudsters.”

The post The IMF’s Warning to Banks: Share Data to Beat AI Fraud appeared first on PaymentsJournal.

Many merchants have long eyed international expansion, only to be daunted by its complexity. That’s the challenge Airwallex is targeting with the launch of its in-store point-of-sale system.

The Australia-based fintech is attempting to stand out in a crowded market by offering a physical solution that allows businesses to accept in-person payments across multiple countries through a single platform—eliminating the need to partner with local vendors in each market.

These brick-and-mortar transactions integrate with online payments within Airwallex’s broader platform, which also includes reporting tools and back-office functionality.

“This is super interesting and brings me back to how I look at the merchant side of payments—processing moves data, acquiring moves money,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Many innovative fintechs have a laser focus on maximizing network performance and optimizing integrated payment workflows, while losing sight of the fact that the data represents real money that merchants need to run their businesses.”

The Operational Bottleneck

When expanding into a new market, merchants typically need to onboard a local acquirer, navigate regulatory nuances, and manage a web of domestic vendor relationships.

These operational hurdles have been often been a dealbreaker. Even among millennial and Gen Z business owners—who tend to show a greater appetite for international growth—the time and cost demands of the traditional cross-border model can make expansion feel like a bridge too far.

Infrastructure as Strategy

Airwallex is betting on its infrastructure as the differentiator. The company holds nearly 90 regulatory licenses across roughly 50 markets, maintains direct connections to local payment networks in more than 100 countries, and offers currency conversion capabilities.

This setup allows funds to be held, converted, and redeployed within local markets—where many competing systems still require immediate payouts to merchants’ accounts. If Airwallex can carve out a niche in the market, it will likely owe more to the strength of the global infrastructure than to the point-of-sale system hardware itself.

“The global POS platform that Airwallex has built is the kind of tech innovation that grabs headlines, but the real power of what they’ve built is the network of global banking licenses,” Apgar said. “Banking is regulated in every country, and while it lacks the sizzle of new tech, collecting money from customers is what merchants care about.”

The post Airwallex Takes Its Cross-Border Play In-Store appeared first on PaymentsJournal.

Deutsche Boerse is deepening its push into digital assets with a $200 million investment in Kraken, expanding its partnership with the crypto exchange and underscoring Wall Street-style interest in crypto infrastructure.

The investment represents a strengthening of the partnership the two firms established late last year. The objective was to collaborate on areas like regulated crypto ventures and tokenized equities, as well as to improve cross-border liquidity for institutional clients.

This partnership exemplifies one of the key trends in the payments industry in recent years: traditional financial companies investing in digital assets technologies. That trend has shown no signs of slowing, as evidenced by Charles Schwab’s recent foray into crypto trading and Mastercard’s acquisition of stablecoin firm BVNK.

Growing institutional confidence in the crypto industry is also one of the main reasons Kraken secured a landmark “skinny” master account with the U.S. Federal Reserve.

“These stories show Kraken is moving closer to the center of institutional market structure,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “Deutsche Boerse’s investment says major financial infrastructure players view crypto exchanges as strategic distribution and liquidity partners—not just a side bet.”

“Crypto and Kraken is entering a new spotlight here,” he said. “They must prove they can plug into traditional and sovereign infrastructure, such as Kraken’s tier 3 skinny account, while also proving they can withstand risks that come with scale.”

An Unwelcome Trend

Alongside this surge in institutional interest, however, has come another, far more unwelcome trend—a spike in cyberattacks. Kraken recently said it is being extorted by a group of bad actors who gained access to proprietary data by tricking two of the company’s staff members. The firm said it received videos purportedly showing Kraken’s internal systems with customer information visible.

The crypto exchange confirmed two instances of inappropriate access but noted that its core systems were never breached and customer funds were never at risk. Roughly 2,000 accounts may have been viewed.

The Human Layer

The decentralized and often anonymous nature of digital assets has made exchanges and users frequent targets for cybercriminals, include everything from crypto investment scams to credential theft.

The incident at Kraken also reflects another concerning trend where bad actors target an organization’s employees or contractors and attempt to bribe or manipulate them into sharing proprietary data.

Coinbase faced a similar attack last year that resulted in stolen customer data and roughly $400 million in damages. The incident occurred after a criminal ring bribed the crypto exchange’s overseas contractors into releasing customer information.

“The extortion incident is a reminder that as crypto moves up-market, the real test is the human layer,” Hugentobler said. “The custody, trading, and tech has proven itself to work, so the question becomes, ‘Are there systems and procedures in place to limit damage caused by any human, whether it is internal or external, so they can gain institutional trust?”

The post Kraken’s Success Attracts Institutional Investment, Cyber Threats appeared first on PaymentsJournal.

American Express is moving to accommodate a new kind of customer—not a person, but an AI agent acting on behalf of a cardholder.

To support this shift, the company has announced plans to enable purchases made by registered AI agents. The Amex Agentic Commerce Experiences (ACE) developer kit is designed to facilitate AI-driven transactions through its closed-loop network.

ACE allows cardmembers to designate which verified AI agents can complete purchases using their cards. Only approved agents are authorized to transact, and the system uses what Amex calls Intent Intelligenceto help ensure that transactions reflect the user’s intended actions.

“American Express’ agentic AI developer tool kit strategy is a wise move into propagating usage,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “It removes barriers for developers to integrate into the American Express ecosystem and simplifies how independents can approach account access. We’ve seen this cooperative strategy work well in other segments, such as business cards and rewards, and expect this will help American Express stay at the top of their game.”

The initiative builds on Amex’s existing infrastructure, which is designed to capture and manage multiple aspects of a transaction within its network.

“This will allow American Express to take advantage of their three-party network, where they own both the cardholder and merchant relationship,” Riley said.

A User-Friendly App

American Express intends to make the experience straightforward for users. In an interview with Digital Commerce 360,Luke Gebb, Executive Vice President and Global Head of Innovation, said the Amex mobile app will provide visibility into where a user’s account credentials are stored.

“Maybe you’ve asked three different agents to do different things for you and those intents are outstanding,” Gebb said. “When purchases come through, match them to the intent so you can see. If you have a problem, you can address it in there.”

Addressing Possible Errors

The company also acknowledges ongoing consumer skepticism around AI-enabled purchases.

As part of ACE, Amex plans to offer Agent Purchase Protection, intended to address disputes if an AI agent makes an error. Details of this protection model are still being developed.

The post Amex Bets on AI Agent Payments appeared first on PaymentsJournal.

South Korea’s central bank is weighing whether to bring ‘circuit breaker’ style safeguards from traditional markets into the world of crypto, as regulators grapple with how to contain risks in fast-moving digital asset trading.

The discussion is informed in part by how traditional markets manage volatility. In the U.S., the stock market relies on circuit breakers to curb panic selling and stabilize trading when sharp declines threaten to spiral. These protections are designed to halt trading once predefined thresholds are breached, giving markets time to cool and preventing disorderly sell-offs.

These circuit breakers are triggered when specific thresholds are met, and the Bank of Korea may consider similar guardrails for South Korea’s digital assets market following a disastrous incident at crypto exchange Bithumb.

In February, the exchange ran a promotion offering a small cash reward. However, a Bithumb employee selected the wrong denomination and mistakenly transferred 620,000 bitcoin (valued at roughly $43 billion at the time) instead of South Korean won. The error caused bitcoin prices on Bithumb to plummet 17%, triggering widespread losses for some users.

In a recent report, the Bank of Korea argued that this incident highlights the urgent need for guardrails in crypto markets that mirror those in traditional financial systems. This could include requiring exchanges to implement stronger early-detection mechanisms, as well as circuit breakers capable of blocking anomalies and pausing trading during periods of high volatility.

Clawing Back Funds

While Bithumb identified the error within about 20 minutes, the central bank noted that the exchange failed to prevent the mistakenly distributed bitcoin from being traded or withdrawn, exacerbating user losses.

Although Bithumb was able to claw back the lion’s share of the bitcoin, it’s still working through the courts to freeze seven bitcoin that remain unrecovered.

Tech Outpaces Regulations

The rapid pace of technological innovation has consistently outstripped regulatory frameworks. For example, the open banking zeitgeist has been fueled by partnerships between fintechs and banks. Yet the collapse of Synapse—which left $265 million in consumer funds in limbo—intensified calls for tighter oversight of such arrangements.

Another challenge is that payments are far faster. Like crypto markets, real-time payment rails eliminate the settlement buffers that institutions have historically relied on to detect fraud or operational errors. As a result, some financial institutions are now exploring ways to reintroduce friction into these processes as a form of risk control.

As seen in South Korea, these vulnerabilities are likely to prompt regulators worldwide to consider implementing stronger safeguards for increasingly powerful, and instantaneous, financial systems.

The post South Korea Considers Guardrails After Crypto Transfer Error appeared first on PaymentsJournal.

As India’s leading instant payments system scales new heights, it’s also becoming a bigger target for fraud—prompting the Reserve Bank of India (RBI) to consider slowing down transactions in the name of security.

The proposed measure includes a one-hour delay for peer-to-peer (P2P) transactions exceeding 10,000 rupees (roughly $100).

The delay specifically targets authorized push payment (APP) frauds, in which users are tricked into transferring money to criminals under false pretenses. India has seen a sharp rise in such cases in recent years, with reported losses increasing significantly between 2021 and 2025. Real-time payment systems like the United Payments Interface (UPI) have been linked to a large majority of authorized push payment-related losses.

“The delay can be key to giving banks time to investigate a transaction and determine its legitimacy when there is suspected fraud or social engineering,” said Suzanne Sando, Lead Analyst of Fraud Management at Javelin Strategy & Research. “It also provides consumers with a second chance to stop and think. That delay can be critical in letting the fog clear for consumers who may have been questioning the transaction but felt pressured to complete it while in contact with the fraudster.”

Additional Transaction Limits

UPI has become a dominant force in global instant payments, accounting for more than four out five real-time transactions worldwide. Retail transactions on UPI have skyrocketed, rising from around $77 million in FY22 to roughly $2.39 billion in FY2500—reflecting both widespread adoption and the growing shift toward digital payments.

The proposed delay would apply only to P2P transfers; merchant payments would remain instant. The RBI has also suggested introducing an additional authentication layer for transactions above 50,000 rupees, potentially requiring verification through a trusted contact. Additionally, certain bank accounts could face limits on incoming funds unless they undergo further due diligence.

Other Approaches to the Problem

This isn’t RBI’s first attempt to combat APP fraud. Last year, regulators introduced measures, such as biometric authentication, often linked to Aadhaar, India’s national digital identity program.

Globally, other P2P platforms have taken different approaches to tackling APP fraud. For example, JPMorgan Chase has implemented safeguards on its Zelle network, including canceling certain payments flagged as high risk, such as those associated with suspected scam activity originating on social media.

The post To Fight Fraud, India Proposes a One-Hour Delay on Some P2P Payments appeared first on PaymentsJournal.

PayPal is making a push into the creator economy with the launch of PayPal Links, a new feature that integrates with Canva and allows users to design content and accept payments in one place.

The move targets a persistent friction point for creators: getting paid. Many still spend significant time and money building standalone websites or storefronts just to process transactions.

By embedding payments into Canva’s design tools, PayPal is aiming to remove that barrier. The integration will give Canva’s 265 million monthly global users the ability to create, share, and monetize content without leaving the platform.

“This is a home run for PayPal,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “What they’ve done with Canva is a great example of the power of embedded payments and shines a bright light on the path to growth that all successful payments companies are following.”

The Growth Opportunity

This growth opportunity has attracted many leading payments firms to build infrastructure for the gig and creator economies. For example, PayPal recently introduced functionality allowing YouTube creators to receive payouts in its PYUSD stablecoin, which marked both a milestone for digital assets and a win for the company.

These partnerships also reflect a broader trend—the convergence of e-commerce and social media into social commerce. TikTok Shop has emerged as a pioneer in this space, largely due to its ability to integrate influencer demos and product videos with payments, creating an end-to-end user experience.

Ditching the Website

This convergence shows no sign of slowing. According to Statista, global social commerce sales are projected to surpass $1 trillion by 2028. This surging market makes it increasingly imperative for creators to embed payments into their content.

While e-commerce may be the primary focus of PayPal’s’ Canva integration, the company notes that PayPal Links also enables creators to bypass the need for a standalone website altogether. Creators can embed payment links, QR codes, and PayPal checkout functionality directly into their Canva designs, allowing them to accept payments via social media, email, or even in person.

This optionality—along with increased support for payment types—should be a welcome addition for creators who often struggle to meet consumers’ high expectations around payments.

The post PayPal Gives Canva Creators a Unified Solution for Payments appeared first on PaymentsJournal.

The real-time payments system FedNow has rapidly gained from over 1,600 financial institutions across the United States. However, these participants have so far been restricted to using only Reserve Banks as intermediaries.

This limitation has prevented banks and credit unions from leveraging the network for cross-border payments. The U.S. Federal Reserve, which operates FedNow, is now considering lifting this restriction. This change would align FedNow more closely with the Fedwire model, which has been in place for decades.

Under the proposed plan, a U.S. institution could use FedNow to send funds to a correspondent bank, which would then facilitate the international leg of the transaction. This functionality could broaden the use cases for a system that has already experienced substantial growth in both transaction volume and value over the two years since its inception.

“A move to cross-border via FedNow is the logical next step in the evolution of real-time payments in the U.S.,” said Hugh Thomas, Lead Commercial and Enterprise Analyst at Javelin Strategy & Research. “By moving to real-time, you’re synching up with the speed of domestic funds movements in big cross-border markets like the EU and the UK. With ISO 20022 standards in the mix in all three markets, you open up a lot of possibilities for cross-border payments solutions. This isn’t to say they’ve gotten there with this move, but it’s certainly a step in that direction.”

Stopped at the Border

While using FedNow for cross-border payments could streamline the domestic payments experience, the network’s real-time settlement would not extend beyond U.S. borders. Once the funds reach an overseas correspondent bank, the transaction would follow the same processes as conventional cross-border payments.

The complex correspondent banking system is likely to continue subjecting these payments to transaction fees, currency conversions, settlement delays, and limited transparency—challenges that have long plagued cross-border payments.

These issues have persisted despite ongoing efforts by industry stakeholders and world leaders. For example, leaders from the Group of 20 countries established a roadmap to improve international transactions. Yet, a recent review highlighted that legacy payments infrastructure and cross-country coordination challenges have hindered meaningful progress.

Weighing the Challenges

Such hurdles are why many experts advocate for sweeping changes to the cross-border payments landscape, potentially involving a shift toward new rails like stablecoins or global networks operated by Visa and Mastercard.

The SWIFT messaging system has also played a key role in modernizing the correspondent banking model, and it is working on a framework specifically for retail cross-border payments.

While expanding FedNow’s cross-border capabilities would likely be welcomed by many institutions, the service would still operate within an increasingly fragmented and complex global market. These are key considerations the Federal Reserve will likely weigh as it reviews public comments and decides whether to move forward with the proposal.

The post U.S. Federal Reserve Considers Taking FedNow Global appeared first on PaymentsJournal.

Despite faltering credit scores, Gen Z is charging ahead—literally—opening credit card accounts at higher rates than any other generation. In the past year, more than one in four of American adults ages 18 and 29 got at least one new card, underscoring the tough choices and high-stakes gamble facing both young consumers and the issuers courting them.

The rush isn’t about perks or rewards. According to FICO, nearly 40% of Gen Zers are taking on new cards as a financial cushion.

“When faced with job loss or income reduction over the past 12 months, 48% of Gen Z and 43% of millennials relied on credit cards to make ends meet, compared to 25% of Gen X and just 7% of baby boomers,” FICO Vice President Jenelle Dito said in a statement.

Threats to Their Credit Scores

Meanwhile, their credit scores are slipping. As of late 2025, Gen Z has the lowest average credit score among all age cohorts at 678, down three-percentage points from the previous year. That’s well below the national average of 714, placing them in what FICO describes as the “competent” to “fair” range.

A key factor is the resumption of student loan payments, which has driven scores lower. FICO reports that nearly one-third of student loan borrowers have had a new delinquency recorded  on their credit files.

Worth the Risk

Because the law prevents credit card companies from knowing how the age of their borrowers, issuers can only do so much to target, or avoid, Gen Z. Despite their higher risk, younger consumers remain a potentially lucrative market with the potential to become lifelong customers.

Card issuers can’t sustain a business by relying on 70-year-olds. They need to build portfolios around younger consumers, which means accepting some of the inherent risks of lending to this cohort.

“The whole goal is to get into the customer so you have cradle-to-grave relationships with them,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “Once they get beyond all the nuances of the early phase of life, like family and kids, they’re going to start accumulating assets, whether it’s a 401(k) or a house. You can’t just knee jerk and shut them all down because their credit scores are running high.”

The post Facing a Precarious Economy, Gen Z Turns to Credit appeared first on PaymentsJournal.

Visa is introducing an on-ramp for merchants to tap into its AI-driven Intelligent Commerce platform. The new offering, Intelligent Commerce Connect is designed to let AI agents discover merchants and complete purchases on behalf of users.

The service is currently being piloted with a number of partners, including AWS, with general availability expected to occur by the end of June.

The launch is aimed at positioning Visa for the expected growth of agentic commerce, though projects vary widely and remain speculative. Some forecasts have been ambitious—McKinsey for example, has suggested that the U.S. retail market could reach as much as $1 trillion in agent-driven transactions by 2030. However, such estimates depend on significant advances in the technology and adoption. Other data points suggest a much earlier-stage market, with Precedence Research estimating global agentic commerce at under $8 billion in 2025.

Available for Any Credit Card

According to Visa, the platform includes features such as secure payment initiation, tokenization, spend controls, and authentication for agent-initiated purchases. It’s not limited to Visa transactions; it also integrates APIs from other card networks alongside Visa’s own, and can connect with multiple payment token vault providers, allowing agent platforms to work across different vendors.

When an AI agent initiates a purchase, the system identifies the appropriate payment credential, replaces the card number with a token, and routes the transaction through the relevant network. It also verifies that the agent is acting within the parameters set by the users before passing payment credentials to the merchant.

A Big Leap into Agentic AI

The release builds on Visa’s earlier push into agentic commerce, following last year’s introduction of Visa Intelligent Commerce, which enabled AI agents to use stored Visa credentials at accepting merchants.

“This is a very strategic move and a natural extension of what they’ve built with the Visa Acceptance Platform,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “This effectively enables every VAP-connected processor and acquirer to offer a turnkey agentic commerce platform that’s interoperable with all of the current standards.”

“It’s important to remember that Visa’s customers in card acceptance aren’t the merchants, but rather the acquirers, processors, and PSPs,” Apgar said. “Visa didn’t bring VAP to market to compete with their customers by servicing merchants directly, but rather to enable their customers to bring new technology to their end-user merchants faster than ever.”

The post Visa Unveils Agentic Commerce Platform for Merchants appeared first on PaymentsJournal.

Ahold Delhaize USA and Fiserv have partnered to launch pay-by-bank as a digital payment option for online grocery orders. If you’re unfamiliar with pay-by-bank, it’s all the buzz in the payment space as an emerging method to pay directly from a bank account, bypassing the traditional card networks.

The key selling point for consumers is convenience, as it eliminates the need to manually enter store card details. Some merchants—typically fuel merchants—are also incentivizing its use through loyalty programs.

Payment Options Galore

Last year, Fiserv partnered with major retailer Walmart to bring the technology to millions of customers, drawing renewed attention to it as a test bed for broader retail adoption.

So why launch a new payment method like pay-by-bank right now? Data from the Javelin Strategy & Research Buyer PaymentsInsights series shows that the grocery vertical has been a particular dominant area for debit cards.

However, credit cards—which pack higher merchant fees—have become increasingly popular among consumers. Pay-by-bank encourages more volume to run through lower cost instant and ACH rails which saves a significant amount of money for the merchant and presents customers with further choices in how they prefer to pay.

Ahold Delhaize USA reports that “tens of thousands of customers have enrolled” since launching pay-by-bank late last year. The technology is available for use at The GIANT Company, Giant Food and Stop & Shop.

The post Fiserv and Ahold Delhaize USA Bring Pay-by-Bank to Online Grocery Orders appeared first on PaymentsJournal.

Bolt, the one-click checkout solution turned financial super app that has raised nearly $1 billion in venture capital, has laid off a third of its staff and announced a pivot to AI—apparently a last-ditch effort to save the company.

The layoffs come amid reports of financial strain and difficulty paying vendors. Fintech Business Weekly reports that Bolt has struggled to cover even mission-critical necessities, including Amazon Web Services, since the start of the year. The company has also eliminated most of its independent contractors, some of whom have not been paid since January.

The downfall has been swift for the company that announced its super app just a year earlier. The platform was billed as a one-stop solution for digital banking, crypto trading, peer-to-peer payments, and even featured an AI agent capable of shopping, making recommendations, and completing purchases on behalf of users.

Despite the fanfare, the super app has failed to gain traction. Google Play shows only about 5,000 downloads, far below Bolt’s claim of a “network of 80+ million U.S. shoppers.” For context, the banking app MoneyLion has more than 5 million downloads, according to Fintech Business Weekly.

Moving Forward from Merchants

Originally, Bolt built its reputation by offering checkout solutions for merchants, but the company believed that expanding into a consumer-focused super app would drive broader adoption of its services.

“Bolt tried to compete with Shopify’s ShopPay and EWS’ Paze, which offer one-click checkouts,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Both ShopPay and Paze are marketed primarily to merchants, adding value by reducing cart abandonment and facilitating guest checkouts. Bolt took a different approach by marketing to consumers, offering a discount shopping plan through their network of merchants. Merchants are enticed to sign up on the premise that Bolt can deliver customers, so it becomes a marketing play, not an operational advantage.”

“At the end of the day, their value prop isn’t compelling enough to consumers and doesn’t resonate with merchants that already have strong brands,” he said. “Bolt has constructed a network of struggling brands trying to attract consumers, while struggling to attract consumers with a network of merchants that doesn’t include any household names.”

Will AI Help?

Bolt’s next move is a pivot to AI, which it hopes will accelerate product development and improve operational efficiency.

“AI may help cut costs and drive efficiency but won’t help a lukewarm value proposition,” said Apgar. “If you’re going in the wrong direction, getting there faster won’t help you much. Unless somebody buys them, Bolt will likely be gone by the end of the year.”

The post Bolt, Facing Financial Struggles, Pivots from Super App to AI appeared first on PaymentsJournal.

The digital assets industry has achieved milestones at breakneck speed in its rise to mainstream prominence over the past few years. While the recent approval of Coinbase’s trust bank application may appear to be just another milestone, it has drawn pushback from the traditional banking sector.

The Independent Community Bankers of America (ICBA) went so far as to call the Office of the Comptroller of the Currency’s (OCC) conditional approval of Coinbase’s application “a grave mistake.”

At the heart of the ICBA’s concerns is the possibility that Coinbase could gain access to the federal banking system without bearing the same regulatory burdens as traditional banks. Because Coinbase wouldn’t be subject to Federal Deposit Insurance Corporation (FDIC) requirements, the group also questioned what would happen to customer assets in the event of the company’s failure.

For its part, Coinbase emphasized in a blog post that it has no intention of becoming a commercial bank. The firm stated it will neither accept retail deposits nor engage in fractional reserve banking. Instead, it aims to use the trust bank charter to bring federal oversight to its crypto custody and market infrastructure operations.

Not an Unprecedented Move

As a leader in the digital assets industry, Coinbase’s approval is significant—but not unprecedented. Circle, Ripple, Paxos, and Bridge have all received conditional trust bank approvals in recent months.

However, these firms are more focused on stablecoins and therefore fall under the oversight framework established by the GENIUS Act, which governs U.S. stablecoin issuers. Their trust bank charters allow them to issue stablecoins, hold digital assets, and manage reserves under federal supervision.

Seeking Universal Rules

As a crypto custodian, Coinbase could also become subject to the CLARITY Act if it is enacted. The bill, which targets non-stablecoin cryptocurrencies, has already passed the House of Representatives but has stalled in the Senate—largely due to opposition from Coinbase over restrictions related to tokenized equities.

Despite the pause in the CLARITY Act’s progress, Coinbase has reiterated its longstanding support for comprehensive digital asset regulation—a position widely shared across the crypto industry, in part to address lingering misconceptions about the sector.

“There was a perception for a period of time that the larger field of crypto was kind of like the wild, wild west,” James Wester, Director of Cryptocurrency and Co-Head of Payments at Javelin Strategy & Research, said in a recent PaymentsJournal podcast. “Yet, there have been companies over the last many years that saw the value of crypto, digital assets, stablecoins, blockchain, and tokenized assets—and were begging for regulatory clarity. They were saying that there’s an efficiency gain here; there are cost reductions.”

“What’s so surprising is how willing and able companies in the space were to say, ‘Now that there’s clarity, we’re happy to look at compliance; we are happy to look at regulation; we are happy to look at governance—because we were always willing to do that,” he said.

The post Community Banking Association Challenges Coinbase’s Trust Bank Approval appeared first on PaymentsJournal.

SoFi is positioning itself as a bridge between traditional banking and cryptocurrency with the launch of a business banking platform designed to let customers manage cash and digital assets within a single system.

The new service, SoFi Big Business Banking, allows firms to hold U.S. dollars in an online SoFi account and convert them into stablecoins, consolidating treasury and digital asset operations in one place.

SoFi will execute transactions on Solana and other blockchain networks, enabling funds to move around the clock without reliance on traditional banking hours or settlement delays. A trading firm, for example, can convert dollars into digital assets and deploy that capital instantly, rather than waiting for bank wires to clear.

Reducing Friction in the Workflow

The offering goes beyond speed. Moving between fiat and digital currencies has long been a point of friction for crypto users, who typically rely on separate providers for banking, stablecoin issuance, and custody. SoFi’s integrated interface reduces dependence on multiple intermediaries, helping to minimize delays and operational complexity.

“The main benefit of blending the two is that it collapses what is usually a fragmented workflow, allowing deposits, payments, treasury settlement, and reporting to all sit under one regulated operating environment,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “That can reduce friction and move towards real-time treasury and settlement. The target audience here is businesses and platforms that already move between the two rails.”

A central component of the platform is SoFi’s own stablecoin, SoFiUSD, launched late last year. Alongside the coin, the company has built regulated infrastructure that connects traditional finance with on-chain systems. This framework allows banks, fintechs, and enterprise partners to issue their own white-label stablecoins using SoFi’s platform.

The move follows SoFi’s decision last June to re-enter crypto trading, alongside expanding blockchain-based remittance services to more than 30 countries.

Encroaching Competition from the Crypto Side

Past attempts at white-label stablecoin offerings have largely come from crypto-focused entities, including Coinbase, Paxos, and BitGo. SoFi is betting that organizations exploring stablecoins may prefer working with a full-service bank that offers a familiar regulatory environment and a broader suite of financial services.

Still, SoFi is likely to face increasing competition from crypto firms moving into banking. Ripple recently added features to its treasury platform that allow customers to manage crypto and fiat currencies within a single system. Several crypto platforms are also pursuing banking licenses, including Coinbase, Zerohash, and Payoneer.

The post SoFi Continues to Meld Crypto with Traditional Banking appeared first on PaymentsJournal.

We follow the Russian credit card market, particularly after G-7 sanctions were imposed in 2022. Russia’s reactions were notable and effective. Once Mastercard and Visa moved away from the market, Russia dusted off its Mir credit card and shifted to its alternative process.

Russia’s domestic payment system worked, but mostly within the country. It had little acceptance outside of the country, and Americans are strongly advised not to visit.  In fact, the U.S. Department of State has this warning posted at their travel site: “Do not travel to Russia for any reason. U.S. citizens are at risk due to terrorism, unrest, wrongful detention, and other threats.”  For me, I’d rather sit in sunny Tampa, FL, with my American Express, Discover, Mastercard, and Visa in my hand.

From the sound of it, Russians feel the same way, and in their international travel, stick to countries like Indonesia, Thailand, Turkey, and the UAE. To each its own, I guess.

But despite Mir’s mechanical resilience, delinquencies and interest rates are off the charts. Interest rates are north of 50%, the Russian Central Bank has a fledgling credit score, and only 3.3 million new cards were issued in 2025, against a base of 100 million.

Delinquencies: Da, Off the Charts

According to this Russian news agency, “From October 2024 to April 2025, the total volume of credit card delinquencies in Russia increased by almost 70% and reached 110 billion rubles.” With inflation at the brink of double-digits, consumer life in the Kremlin is not so rosy.

What’s Next

Russia does deserve credit for Mir as a stand-in for credit infrastructure. It lacks the global capabilities of the Mastercard and Visa networks. It also lacks the collaborative support of a global network that helps with credit management and fraud controls. But, almost half a decade later, it is still working. Their home-grown credit scoring isn’t FICO Score-based, but it is better than nothing. For now, the market’s biggest challenge is to control inflation, manage down rates, and improve credit quality.

The post Credit Cards in Russia: Comrade, Watch Your Rubles appeared first on PaymentsJournal.

After processing more than 106 million disputes last year, Visa is rolling out new AI tools to tackle a growing—and often understood—problem.

Many of these disputes arise from unrecognized, but often legitimate, charges on consumers’ increasingly complex statements. This surge represents roughly a 35% increase over the past six years.

To address this pain point, Visa is launching six AI-driven tools. Three are designed to help issuers better analyze and centralize dispute data, while the other three focus on merchants, aiming to improve a longstanding challenge: data sharing between merchants and card issuers. 

“The legacy chargeback and dispute process was designed around consumers working with their card issuers and merchants working with their acquirers,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “At the same time, legacy data formats like ISO 8583 were designed to be compact for fast communications. They only allow 23 characters to be transmitted for the merchant descriptor, with no supporting info on what was purchased.”

“As consumers use cards more and more, monthly statements are typically multiple pages and consumers are challenged to remember where they shopped and what they bought,” he said. “With cryptically brief merchant descriptors and no purchase details, consumers frequently click on the ‘dispute this charge’ button next to an unremembered in their bank’s mobile app, hoping the card issuer can provide the details.”

Timed-Out Inquiries

In the current model, issuers often lack direct access to key transaction data. Compounding the issue, retrieving the information requires a complex chain of communication among the acquirer, merchant, issuer, and ultimately the consumer.

“This whole process runs on a short time window in order to provide good service to the cardholder,” Apgar said. “If the response process isn’t completed in time, the default is a chargeback to the merchant and the consumer gets reimbursed for the purchase.”

“The result is that chargebacks are increasing, simply because the legacy process is being overloaded,” he said. “Many of these chargebacks get classified as friendly fraud, where the consumer intentionally tries to evade a valid sale. And in fact, some of them are, but many are simply the result of timed-out inquiries.”

Piloting an Answer

Because many steps in the dispute process are still manual, the current system struggles to scale alongside the increasing volume of credit card transactions and disputes.

“The answer is to build a process where card issuers can communicate directly with merchants to obtain more detailed info about who the merchant is and what the consumer bought there,” Apgar said. “There are number of different models being piloted now, including a shared database where merchants upload info for access by issuers and an API hub that enables issuers to query merchants and for merchants to provide automated replies.”

“Issuers can also use this data to proactively expand their cardholder statements and head off inquiries from consumers by providing detailed purchase info upfront,” he said.

The post Visa Streamlines Credit Card Disputes with New Tools appeared first on PaymentsJournal.

The European Central Bank (ECB) has reaffirmed its ambition to reduce reliance on non-European payment systems—most notably the networks operated by Visa and Mastercard—in a new position paper outlining a roadmap for the future of retail payments in the EU.

U.S.-based rails still process more than 60% of card transactions in Europe, with 13 of the 21 eurozone member states relying exclusively on international card schemes. The ECB’s strategy aims to strengthen Europe’s strategic autonomy and resilience by reducing dependence on a handful of non-European providers, while also shielding the payments ecosystem from geopolitical risks and cyber threats.

Building Their Own Rails

The roadmap reflects a broader policy shift towards enhancing the EU’s financial sovereignty and fostering competition in a market long dominated by global card networks. The EU has already announced plans to develop its own payment network, similar to Brazil’s Pix, with account-to-account (A2A) payments at its core. The initiative is currently targeting a 2030 launch.

In parallel, a UK consortium has announced plans to build a domestic payment rail to rival Mastercard and Visa, also aiming to be operational by 2030. The two payment giants currently handle roughly 95% of all card transactions in the UK.

“Given the geopolitical climate, Europe is nervous about being dependent on U.S.-based companies,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “The EU had a wakeup call about relations with the U.S. Not that they are actively looking to kick Visa and Mastercard to the curb, but if something should go sideways, the EU doesn’t want to be left with no payment network.”

Relying on A2A

The ECB’s paper places renewed emphasis on A2A payments as a cornerstone of Europe’s future payments infrastructure. Also known as pay-by-bank, A2A payments allow funds to move directly between bank accounts, reducing transaction costs and supporting real-time settlement.

Perhaps most importantly, A2A payments could help diversify payment options, enhancing consumer choice while improving the overall reliance and reliability of the payments system. The immediate challenge will be to establish them as a credible and widely adopted option for European consumers.

“It’s not that Europe is in love with A2A payments,” Apgar said. “A2A payments in the EU are about at the same levels as they are here in the U.S.”

The post The EU Seeks to Break Its Dependence on Visa, Mastercard Rails appeared first on PaymentsJournal.

Amazon approaches U.S. card issuance with a Chase-branded consumer card (this one is in constant use in my household), a PLCC card (issued by Synchrony), and small-business credit cards. The strategy is to link your Prime account to the card and generate reward points.

A Shift in Partners

U.S. Bank announced it had won the small-business card issuance program, which American Express has issued for the past five years. U.S. Bank is a top card issuer and has a strong presence in retail credit cards, with a cluster of co-brands and feature-rich card programs that range from a baseline secured card to the U.S. Bank Altitude Reserve Visa Infinite card, which faces off with the Chase Sapphire. U.S. Bank also has a global merchant acceptance network and Elan, which issues more than 1,000 white-label credit cards for small banks and credit unions.

American Express is launching a new line of small-business credit cards under the Graphite moniker.  We think Graphite is a top credit card plan for small businesses, so the loss of Amazon will probably be limited for Amex. For U.S. Bank, which has been on the cusp of becoming a top small-business card, it lands them squarely in the top tier.

A Global Patchwork of Partners

As you expect with a global firm, Amazon localizes its issuance strategy. They do not have a card issuance partner in Australia, Canada, or France, but they are strong in several markets. Santander issues the co-brand in Austria and Germany. In the UK, Barclays is the partner, and in the United Arab Emirates, it is Emirates Islamic Bank.

In summary, Amazon is moving from Amex to U.S. Bank. It won’t hurt American Express, which is also rolling out the Graphite small-business card suite. For U.S. Bank, it firmly establishes them as a top-tier small-business card issuer. And for Amazon, they bring a bank card issuer running on the Mastercard rails, running in parallel with the consumer card, which Chase issuers run through Visa.

The post U.S. Bank Scores with Amazon Small Biz Card appeared first on PaymentsJournal.

The approval of bitcoin ETFs sent the price of bitcoin soaring to new heights last year, marking one of many milestones for the burgeoning digital assets industry.

While bitcoin has since pulled back, the financial services sector’s interest in digital assets has not waned, as evidenced by Mastercard’s recent $1.8 billion acquisition of stablecoin company BVNK.

Among the technology’s primary selling points are the efficiency and security gains enabled by blockchain infrastructure. However, recent findings from Google suggest there may be emerging vulnerabilities in the cryptocurrency ecosystem.

The tech giant’s researchers conducted quantum computing pilots and found that more advanced models could potentially crack widely used cryptocurrency encryption methods far more quickly and efficiently than previously believed.

Ramping the Urgency

According to Google, such attacks are not yet feasible, and some blockchains—including bitcoin—already have mitigation measures in place. Still, the company warned that these factors should not diminish the urgency of addressing potential vulnerabilities.

Instead, Google urged the digital assets industry to adopt stronger security standards capable of withstanding emerging threats, including a transition to post-quantum cryptography—an encryption approach designed to resist quantum-based attacks.

“I don’t think this is a ‘bitcoin is getting hacked tomorrow’ story,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “The point here is that these security upgrades will take time, possibly years, so even though it seems early on in the hardware timeline, companies need to start making the migration now for chains, wallets, and custody.”

“We’re a ways out from a full-fledged quantum computer, but if companies wait until it is out to upgrade security measures, it will be way too late,” he said.

Not Just a Crypto Threat

Like many transformative technologies, quantum computing presents a double-edged sword. By leveraging the principles of quantum mechanics, it moves beyond the limits of conventional binary and linear computing models.

The result is a model that is significantly more efficient and less resource-intensive. While quantum computing could prove to be a gamechanger for businesses—and even serve as a more effective foundation for resource-heavy AI models—regulatory and organizational constraints may slow legitimate adoption, giving bad actors a head start.

There are already signs of this shift. According to separate data from the Association of Certified Fraud Examiners and SAS, roughly 10% of respondents reported that quantum AI is already creating impacts, and most expect quantum computing to play a role in fraud prevention by 2030.

This early adoption among cybercriminals, combined with the technology’s disruptive potential, suggests that quantum computing is not just a future risk for the crypto industry, but a looming challenge for the entire financial services space.

The post Google Warns That Quantum Computing Could Soon Crack Crypto Encryption appeared first on PaymentsJournal.

Credit card holders may be more sensitive to changes in interest rates than commonly assumed. Data reveals that, on average, a 1 percentage point increase in a borrower’s annual percentage rate leads to an almost 9% drop in credit card spending the following month.

Researchers at the Boston Federal Reserve describe this adjustment as an “economically meaningful response.” In practical terms, a 1 percentage point increase in APR translates to roughly $74 less in monthly card spending.

Effects in Different Situations

However, this effect is not uniform. The impact of interest rate changes depends on whether the cardholder carries a balance, as well as their credit score. Among accounts that carry balances, a 1 percentage point increase in APR reduces spending by about 15% in the following month—nearly double the overall average effect. By contrast, spending by cardholders who pay off their balances in full each month shows little sensitivity to interest rate changes.

Still, individual responses can vary and may shift from month to month.

“We wonder about how strategic revolvers really are,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “The Fed suggests a connection between interest rate increases and spending declines, but that oversimplifies what actually happens. If consumers were more strategic, we probably would not have revolving debt in excess of $1 trillion at 20.97%. In many cases, the car breaks down, the child needs medical attention, or the household budget is out of whack. Those are core drivers of revolving debt.”

Credit Scores and Other Factors

The researchers also found similar variation by credit score. Borrowers with lower credit scores reduce their spending by about 18% when APR rises by 1 percentage point, while spending among higher-credit-score borrowers changes very little.

Instead, higher-credit-score consumers tend to adjust by paying down debt, reducing their outstanding balances by about 7%. In contrast, lower-credit-score consumers primarily respond to higher rates by cutting back on spending.

Additional factors may also influence how consumers respond to interest rate changes, and remain an area for further study.

“It would have been interesting to understand the relationship between spending and interest rates, broken out by credit line utilization,” Riley said. “Are some segments blocked from spending because they have maxed out lines?”

The post How Changing APRs Affect Credit Card Users appeared first on PaymentsJournal.

News of a leaked Anthropic AI model rattled the cybersecurity industry, sending the stocks of major firms sharply lower. What initially looked like a potential game changer now raises urgent questions: can organizations trust AI with their most sensitive digital assets, or does this incident simply reinforce the need for expert protection?

According to Mint, a leaked draft blog post introduced a new tier of AI models called Capybara. The draft claimed that Capybara outperformed Anthropic’s flagship model, Claude Opus 4.6, in “software coding, academic reasoning, and cybersecurity-related tasks.” It further noted that training on Claude Mythos—a model Anthropic describes as their most advanced yet—has been completed.

Why Did It Leak?

While Anthropic attributed the leak to “human error,” the explanation may do little to reassure organizations about the company’s ability to safeguard sensitive data. Some analysts speculate that there could have been other motives at  play.

“The leak of Capybara is unfortunate but I almost wonder if it was intentionally left in an accessible data lake to highlight some of the emerging cyber risks that continually evolving AI platforms pose and will pose,” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research. “All of that said, the model is still in testing, with Anthropic clearly stating that it is aware of bugs and risks that need to be addressed, which is why Anthropic has only soft-launched Capybara.”

The Looming Threat of AI

Anthropic also highlighted the cybersecurity risks tied to these model, emphasizing the escalating arms race that is going on with AI between defenders and cybercriminals. The company cautioned that Capybara could be the first in a series of models capable of identifying and exploiting vulnerabilities far faster than security teams can respond. In other words, criminals could leverage the model to fuel a new generation of AI-driven cybersecurity threats.

Investors reacted swiftly, driving shares of CrowdStrike, Datadog, and Zscaler down more than 10% in early trading.

“The tanking of tech stocks in the wake of news about the Capybara leak really just highlight the lack of understanding investors have about AI overall,” Goldberg said. “We know these models will continue to adapt, and will do so at a pace faster than industry security measures can respond. This is why governance around AI is so critical.”

The post Pumping the Brakes on Anthropic’s Leaked Cybersecurity AI appeared first on PaymentsJournal.

Real-time payments have reshaped entire economies in markets like Brazil and India, but they are not just a domestic rail for faster account-to-account transfers.

India’s UPI, for example, has expanded beyond its borders through integrations with systems in other regions and continues to add new features at a rapid pace.

The promise of real-time payments once drove Mastercard to acquire most of European fintech Nets’ payments services for $3.2 billion, seven years ago. The deal brought Nets’ real-time payment infrastructure, bill pay, and electronic invoicing segments under Mastercard’s umbrella. At the time, the payments giant sought to move beyond card payments and expand its network.

Now, however, Mastercard is reportedly consulting investment bankers on a plan to divest the unit. According to the Financial Times, the sale is targeting private equity firms and is expected to fetch significantly less than Mastercard originally paid.

Long-Term Strategy Questions

Taken on its own, this could appear as a retreat from a deal that fell short on revenue growth. But coming just days after Mastercard’s blockbuster acquisition of stablecoin payments infrastructure firm BVNK, it raises questions about the company’s long-term strategy.

The BVNK acquisition, valued at $1.8 billion, represents the largest digital assets deal to date. It comes after nearly every major player in financial services has made a splashy stablecoin investment.

Mastercard stated that the objective of the deal is to reach markets not currently served by its card network, including cross-border remittances, business payments, and payouts in the creator and gig economies.

The Shape of Payments to Come

While stablecoins are a powerful solution in these applications—especially for freelancers and contractors—real-time payments can also be highly effective.

Indeed, the Clearing House reported that its RTP Network continues to set all-time highs in payments value and volume. While large commercial settlements account for many transactions, much of the recent growth is driven by use cases like earned wage access disbursements and gig economy payouts.

Given the growing entrenchment of real-time payments, Mastercard’s pivot from Nets to BVNK is unlikely to redefine the payments landscape. Instead, both payment types are set to thrive in an increasingly crowded market.

The post Could Mastercard’s Instant Payments Divestiture Signal a Strategy Shift? appeared first on PaymentsJournal.

A proposed ban on credit card surcharges in New Zealand, set to take effect in May, appears to be on its last legs after a key political party withdrew its support.

New Zealand introduced legislation last year to ban in-store surcharges on both card and contactless payments. An industry group, Retail NZ, opposed the move, warning that businesses would likely have to raise prices elsewhere to recover payment costs.

Now, the ACT Party, which had been working with the government to refine the bill, says the proposed ban is effectively dead. The opposition Labour Party had never supported the measure. While the country’s Commerce and Consumer Affairs Minister maintains the bill is still under consideration, its political backing has largely collapsed.

“It was obviously appealing to take away a fee that a lot of customers hate, but if it only puts that fee on to the small business, it’s not actually a win,” ACT Party leader David Seymour told RNZ. “It’s just a shift, and often carried by people that can’t afford it at all.”

A Political Hot Potato

These extra fees have become common in the U.S., where only three states—Massachusetts, Maine, and Connecticut—explicitly ban credit card surcharging. But debate over the fees, like the charges themselves, is becoming more visible. Don Apgar, Director of Merchant Payments at Javelin Strategy & Research, describes the situation as a “political hot potato.”

“If you’re in favor of surcharging, then you get framed as anti-consumer because these large merchants already make millions,” Apgar said. “If you’re anti-surcharging, then you get framed as being against small business.”

Consumer Complaints Are Being Heard

Consumers are starting to take notice of the surcharges—and they’re not happy. The issue may be approaching a tipping point where public sentiment turns against such fees for good.

“People are starting to pay attention to their bills and speak out against paying an extra fee,” Apgar said. “You’ll see the tide go out at about the same speed as it came in, with merchants gradually opting not to add surcharges.”

“I took my truck in for service last week and the guy has a notice on his website that credit cards will be charged an additional 3% fee,” he said. “But when I paid, no fee was added. I asked the owner, and he said he stopped surcharging because customers were complaining and he hadn’t updated the website yet.”

The post New Zealand’s Credit Card Surcharge Ban May Not Happen After All appeared first on PaymentsJournal.

Stablecoin is not synonymous with a digital U.S. dollar, despite the dominance of USD-backed assets in a rapidly expanding market.

A stablecoin’s value can be pegged to range of assets—from commodities like gold to other cryptocurrencies—but these variants are often used more as investment vehicles than as everyday payment mechanisms. Likewise, many leading USD-backed stablecoins function as yield-generating instruments or as tools for large-value settlements.

That said, there is growing evidence that the stablecoins gaining the most traction in real-world use cases are those backed by fiat currencies other than the U.S. dollar. According to a report by Visa and Dune, the non-USD stablecoin market reached $1.1 billion in February, tripling in just over three years.

More telling is that roughly half of these domestic currency-denominated stablecoins are held in institutional and individual wallets, while about a quarter sits on centralized exchanges. This distribution suggests active usage, likely in applications such as cross-border payments, remittances, and B2B settlement.

Stablecoin vs. CBDC

Within this segment, Circle’s EURC accounts for over 90% of transfer volume. That a euro-pegged stablecoin leads is unsurprising: the euro is used across 27 countries, and inefficiencies in cross-border payments have long been a lingering pain point that European policymakers are working to address.

However, these leaders have shown a preference for a central bank digital currency over privately issued stablecoins. After years of discussion, the digital euro is entering a pilot phase and is slated to launch in the latter part of next year.

One of the key motivations behind the CBDC push is the dominance of USD-backed stablecoins. Still, it remains unclear how a digital euro would coexist with euro-denominated stablecoins already in circulation.

Tough Sledding

Outside Europe, adoption of non-USD stablecoins has been more limited. Brazilian real-backed stablecoins represent the next-largest share of the segment, but they trail far behind euro-based counterparts.

Even so, new entrants continue to emerge, such as South Africa’s ZAR Universal (ZARU), a rand-pegged digital asset. These products, however, face the daunting task of unseating USD-backed stablecoins, which still account for the lion’s share of a global market valued at more than $310 billion.

The post Stablecoins Are Moving Beyond the Dollar appeared first on PaymentsJournal.

Artificial intelligence has rapidly stretched the limits of the traditional computing model, as it demands substantial infrastructure and resources to operate.

A potential solution lies in quantum computing, which leverages the principles of quantum mechanics to move beyond conventional binary and linear processing. Shifting AI to a quantum computing foundation could theoretically enable models to improve efficiency while consuming fewer resources.

While quantum AI may still seem like a distant prospect for organizations that are just beginning to integrate generative and agentic AI, there are signs that cybercriminals are already experimenting with the next level of artificial intelligence.

According to data from the Association of Certified Fraud Examiners and SAS, most respondents expect quantum AI to significantly impact fraud prevention by 2030, and roughly 10% report that it is already having an effect.

Supercharging the Deepfake Threat

Equally concerning, the study found that bad actors have increased their use of AI across nearly every aspect of their operations, from consumer scams to document forgery. However, deepfake-driven social engineering has seen the sharpest rise, with roughly three-quarters of respondents reporting an uptick over the past two years.

While early deepfakes were often easy to identify, more advanced AI models have made them a threat that can no longer be dismissed. The AI Incident Database reinforced these concerns, documenting more than 100 distinct deepfake incidents between November 2025 and January 2026.

A Perilous Situation

These emerging threats are straining the capabilities of modern cybersecurity systems. For financial institutions in particular—bound by strict compliance constraints and high customer expectations—implementing new technologies is often a complex and resource-intensive process.

This has created a precarious situation where cybercriminals are evolving in lockstep with rapidly advancing technologies, while many banks are struggling to keep pace. According to the ACFE study, only 7% of respondents said their organization was more than moderately prepared to detect or prevent AI-powered fraud.

With quantum computing potentially entering the equation, this gap could quickly become catastrophic.

“We’re close to where quantum computing is going to break encryption,” Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research told PaymentsJournal. “This goes back to the whole risk that we see with the way we’re securing data today. Data is tokenized or encrypted; card numbers are tokenized as they’re transmitted as this is a requirement for PCI compliance.”

“If quantum computing is able to break that encryption, then we’re ultimately sending card data in the clear and it’s setting us back 20 years,” she said. “Tokenization will mean nothing.”

The post Bad Actors Are Already Piloting the Next Evolution of AI appeared first on PaymentsJournal.

Amex and I go back to 1998, when I was growing up in the world of bank cards, learning the wonders of carrying revolving debt. But I aspired to have an American Express card, specifically, their “green card.” The business model was different than the Mastercard and Visa in my wallet.  It shifted my thinking from carrying a balance on my card to spending only what I could afford to paying in full monthly.

You can revolve now at Amex, but the discipline has been burned into my budget for years, and for that, I always think of saying “thank you.”

Staying Power

So much has gone on at American Express in the past few years. Steve Squeri became CEO in 2018 after Ken Chenault retired. If the payments industry ever had a “Hall of Fame,” Chenault would be high on the list. Among other things, he coined the word “spendcentric” to illustrate that American Express’ strategy was to build credit relationships based on transactional fees, which were less risky than bank strategies that built revenue on risk-based interest.

In his shareholder letter, dated yesterday, Squeri lists six topics in his annual review:

• $72 billion in revenue
• 12.4 million proprietary cards acquired
• >70% of newly acquired accounts paying fees
• 30 consecutive quarters of double-digit net card fee revenue growth
• 170 million merchant acceptance locations
• 65% of consumer account acquisitions from millennials and Gen Z

And credit quality has always been a mainstay. We touched on this in Javelin’s annual review of Dodd-Frank stress testing. Among 16 top financial service companies, American Express’ potential loss rates under severely stressed financial conditions were projected at only 9.7%, compared to the all-bank average of 16.9%.

A New Business Card in the Mix

In a separate announcement, American Express launched a new line of business credit cards under the moniker of Graphite Business Cash Unlimited. Graphite will stand with Amex’s line of business card products, which include Business Green, Gold, and Platinum, Amazon Business, Blue Business, Delta Business, Marriott Business, and Hilton Business.

We think Graphite will be a winner, too. Watch for Javelin’s upcoming report on the Small Business credit card market, planned for July 2026. Javelin Card Bench is currently live in the Canadian market, and we find the issuer facing off aggressively with top Canadian small business card issuers like BMO, CIBC, TD, and Scotiabank. Card Bench has a beta-version for small business cards in the U.S., and will soon integrate Graphite into the tracking of 74 small business cards issued by 20 issuers, ranging from American Express, Bank of America, Capital One, Citi, Wells Fargo, and US Bank, plus smaller issuers like 5/3, Huntington, Regions, and Truist.

The post Good Business at American Express appeared first on PaymentsJournal.

Amid a flood of stablecoin launches, many of the world’s leading financial services firms continue to champion tokenization.

Robinhood’s CEO highlighted the technology’s industry-transforming potential last year, and now Blackrock CEO Larry Fink has echoed that enthusiasm with similarly strong remarks. Fink noted that the global proliferation of digital wallets has created the ideal conditions for tokenization, which can enable near-real-time settlement, lower transaction costs, and always-on operations.

While Fink was mainly referring to the tokenization of traditional assets like stocks and bonds, these same advantages extend to tokenized cash and bank deposits. This is one reason the Bank of Montreal (BMO) is moving ahead with plans to roll out tokenized cash, enabled by Google Cloud Universal Ledger (GCUL) and CME Group.

“It’s less about crypto payments and more about rebuilding the plumbing between banking, collateral, and financial market infrastructures,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “BMO is basically saying that if markets are heading toward longer operating hours and continuous trading, then the money layer has to become continuous.”

“What is important here is that with the use of tokenized cash, CME clearing will allow firms to meet margin calls and settlement obligations in real time,” he said. “This should reduce idle capital and liquidity, and the need to post excess cash just to survive mismatches within banking hours.”

An Agnostic Blockchain

The initiative is also notable as one of the largest deployments of GCUL to date. Google designed the platform as a neutral, global infrastructure for the financial services industry.

Unlike many blockchain networks built around a specific cryptocurrency or corporate ecosystem, GCUL is designed to be blockchain-agnostic and capable of integrating with Google’s broader technology stack.

Tokenizing Security

BMO’s tokenized cash capabilities are expected to go live by the end of the year, alongside the launch of tokenized deposits.

Tokenized deposits are often compared to stablecoins because both can be pegged to fiat currencies. However, the key distinction is that while stablecoins are backed by an issuer’s reserves, tokenized deposits represent direct claims on funds held within the banking system.

This difference is important, as it gives banks a way to differentiate their offerings in a crowded digital landscape.

“This is aimed at institutions who want the benefits of tokenization without jumping into an open and permissionless rail from day one,” Hugentobler said. “If tokenized cash wins in financial markets, such as derivatives, collateral, and settlement, then adoption may come from capital operations before merchant checkout or consumer wallets.”

“If this were to be the case, it could make commercial bank deposits more competitive and kill the argument of ‘stablecoins will disintermediate banks,’” he said. “Other effects down the line like capital efficiency, banking hour risks, and more will change for the better.”

The post BMO Brings Tokenized Cash to Google’s Blockchain appeared first on PaymentsJournal.

A European coalition of retailers and wholesalers is pushing back against a proposed EU rule that would require businesses to accept cash.

In a statement, the industry group EuroCommerce responded to ongoing EU payment discussions taking place as consumers across Europe continue shifting toward contactless cards, mobile wallets, and other digital payment methods.

While merchants say they support continued access to cash, they are urging policymakers to include exemptions in any new regulation. They argue that mandatory cash acceptance could drive up costs, increase security risks, and disrupt digital retail models.

Exemptions Sought

The exemptions outlined by EuroCommerce are broad and, in practice, could allow many retailers to opt out. In its position paper, the group highlights scenarios such as unmanned environments, situations where safety is at risk, and cases where accepting cash could impose disproportionate costs. It also calls for the ability to display “no cash” signage.  

“Businesses want to meet customers where they are and accept however they want to pay,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “The trend toward no cash is largely driven by the move toward cards and digital payments. When cash becomes a very small percentage of sales, most merchants are comfortable eliminating it entirely, because new customers that the business will attract are likely to pay digitally as well.”

The Cost of Cash

At the core of the debate is the cost of handling cash. In markets where digital payments dominate, maintaining the infrastructure to process cash can become disproportionately expensive.

These costs are not linear. If cash accounts for only 10% of sales, that doesn’t mean handling expenses fall by 90%. Much of the operational burden is fixed, and merchants can’t reduce it unless they’re permitted to stop accepting cash altogether.

“From the sellers’ perspective, digital payments offer not only cost savings, but better safety and security for employees who no longer have to handle, control, and transport cash, especially in challenging environments like overnight store hours, air transport, etc.,” Apgar said. “Not accepting cash enables merchants to eliminate those functions and the associated hardware from their businesses, streamlining operations and overhead in the process.”

“The concern for merchants is that once the government steps in and disrupts this free market trend with legislation that mandates cash, merchants will be stuck with the fixed cost of cash acceptance even though it’s no longer benefitting their business or customers,” he said.

The post European Retailers Fight EU Plan to Mandate Cash Acceptance appeared first on PaymentsJournal.

Microsoft has detected a surge in sophisticated phishing campaigns timed to exploit heightened anxiety during tax season, as cybercriminals ramp up efforts to trick both individuals and businesses.

According to the company, criminals are sending fraudulent emails masquerading as tax refunds, payroll documents, filing reminders, and requests from tax professionals. These messages are intended to lure recipients into opening malicious attachments, clicking on suspicious links, or scanning harmful QR codes.

The scope of these attacks is significant. In one large-scale campaign detected last month, more than 29,000 users across industries—including financial services, technology, and retail—were targeted.

Microsoft researchers say the campaigns are not only aimed at individuals, but also professionals who regularly handle sensitive financial data. Accountants and similar roles are especially attractive targets because they are accustomed to receiving tax-related communications and often have access to valuable information.

More Convincing Every Year

Compounding the threat, phishing tactics have become more sophisticated, with attackers leveraging advanced tools to create more personalized and convincing messages.

“A huge part of this is generative AI, which is making these emails way more convincing, said Suzanne Sando, Senior Fraud and Security Analyst at Javelin Strategy & Research. “The average consumer will say: ‘I don’t think this is real, but maybe it is.’”

The IRS continues to stress that it doesn’t initiate contact with taxpayers via email, text, or social media, and it doesn’t demand immediate payment or threaten arrest over the phone. Official communication is typically sent through U.S. mail, making any deviation from that a strong indicator of a scam.

“We push the point that the IRS is never going to call and ask for your information,” Sando said. “They’re never going to email you and ask for information, but people are still going to give it up.”

Tax-Adjacent Scams

To illustrate how these attacks are carried out in practice, Microsoft highlighted several common tactics seen in recent campaigns, including:

• Tax-themed websites designed to trick users into clicking links under the guise of accessing updated forms
• Fake IRS messages promoting a “Cryptocurrency Tax Form 1099,” particularly targeting the education sector
• Emails impersonating clients seeking help with filing, leading to malicious links
• Targeted lures aimed at CPAs that are phishing kits to steal a victim’s email and password

The post Microsoft Warns of New IRS-Based Phishing Attacks appeared first on PaymentsJournal.

Gift cards are moving beyond retail and rewards programs—now, regulators are exploring how they can serve as an entry point into investing.

The use cases for gift cards have continued to expand, especially as prepaid products have become an integral component of many organizations’ loyalty and incentives programs.

The versatility of these solutions has prompted the Securities and Exchange Board of India (SEBI) to propose an innovative framework that leverages gift cards and prepaid instruments to attract new investors. Under this model, gift card recipients would be able to convert their balances into shares of a mutual fund.

SEBI has outline several parameters for this effort. For example, prepaid accounts would be funded exclusively through electronic funds transfers or via India’s popular UPI real-time payments system.

The regulator has also proposed a transaction cap at 50,000 rupees (roughly $537). While this may appear modest from an investment standpoint, it presents substantial long-term growth potential.

“The move in India authorizing the simple inclusion of prepaid cards to fund long-term investments highlights the power of giving, backed by the security of prepaid cards,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “By allowing prepaid to be used as a gifting vehicle for investments, India will enable opportunity for underrepresented communities to begin their investment journeys.”

More Than a Cash Equivalent

Fostering financial inclusion is another key objective of SEBI’s strategy. Prepaid solutions offer a compelling alternative to cash by enabling unbanked and underbanked individuals to participate in the digital economy. This is one of the reasons nonprofit organizations are increasingly adopting gift cards for aid distribution.

Among other benefits, digital gift cards offer immediate delivery and are trackable. Perhaps more importantly, they can be tailored for specific use cases, such as limited spending to select brands or approved categories—or enabling conversion into mutual fund shares.

From Gift to Long-Term Investment

All these benefits underscore why gift cards continue to evolve and find new applications. While India’s approach plan is noteworthy, it is far from an outlier.

“It should be noted that there are other great examples of similar use of prepaid vehicles for investment in other global markets,” Hirschfield said. “In the U.S., givers can fund a recipients 529 tax-advantaged education savings plans through organizations like Gift of College. Small gifts into these programs create opportunity for the recipient to grow those gifts into meaningful, long-term investments.”

The post India Floats Plan for Converting Gift Cards into Mutual Funds appeared first on PaymentsJournal.

The European Union has made overtures to Turkey about joining the Single Euro Payments Area (SEPA), though Ankara has yet to respond.

An EU envoy suggested that participation in the payments system could deepen Turkey’s integration with the European economy and make it easier—and cheaper—for people to send money across borders. Several other non-EU countries, including Albania, Moldova, Montenegro, and North Macedonia, joined SEPA over the past year, bringing the total number of participating nations to 41.

According to Reuters, EU officials raised the proposal with Turkey’s foreign minister in Ankara last month.

“SEPA could present a valuable opportunity to strengthen Turkey’s economic integration as a candidate country and a key trade and economic partner of the EU,” chargé d’affaires Jurgis Vilcinskas told Reuters.

Potential Roadblocks

So why hasn’t Turkey jumped at the opportunity? The EU is ⁠already its largest trading partner, with more than €200 billion in trade volume. The EU estimates that countries that joined SEPA over the past year could collectively save up to €500 million.

One roadblock is regulatory alignment. To join SEPA, Turkey would need to comply with EU rules on payment services, including the Payment Services Directive, which would require stronger anti-money laundering measures and enhanced data protection standards. Vilcinskas noted that the European Commission is willing to support Ankara through this process.

There’s also some concern about how such changes might affect parts of Turkey’s domestic economy.

“Turkish banks would be losing some fee revenue from foreign transfers,” said Hugh Thomas, Lead Analyst of Commercial and Enterprise at Javelin Strategy & Research. “So they may be less inclined to jump into SEPA, if asked their opinions by the regulators.”

Slow and Steady

At the same time, Turkey has not rejected the proposal outright. Given that its EU accession talks have been ongoing since 2005, progress on SEPA may simply take time.

“The last words you’d ever use to describe efforts to better integrate Turkey with the EU would be ‘fast moving,’” said Thomas. “This is likely just more of the same.”

Ironically, Turkey’s payments economy is already among the most advanced globally. According to Visa’s 2026 Financial Services Research, contactless payments and QR codes dominate everyday transactions, with Android-based contactless payments reaching 70% usage in settings such as supermarkets and cafes.

The post The EU Invites Turkey to Join SEPA appeared first on PaymentsJournal.

Stripe is betting that the next evolution of payments won’t be drive by humans, but by autonomous AI agents transacting on blockchain rails.

Blockchain has become a core component of the financial services infrastructure, underpinning everything from stablecoins to artificial intelligence models—and increasingly serving as the foundation for programmable, always-on commerce.

Stripe has been an avid investor across these areas, including the acquisition of stablecoin infrastructure firm Bridge and its expansion into agentic commerce through integrations with buy now, pay later leaders in recent years.

Last year, the payments firm unveiled Tempo, a blockchain effort launched in a collaboration with digital assets firm Paradigm. Tempo was built to facilitate high volumes of payments, and as the blockchain brings its mainnet online, there are reportedly over 100 services integrated.

Stripe highlighted Tempo’s capability to reshape cross-border payouts, payments, and remittances, and the blockchain could even play a role in embedded finance and tokenized deposits. Stablecoins are expected to serve as the workhorses facilitating many of these functions, and Stipe has highlighted its objective to bring “real payment workloads” to digital assets.

Sessions with an Agent

Stablecoins will also likely factor into the operations of the newly launched Machine Payments Protocol (MPP) an open agentic commerce standard designed to provide the infrastructure for AI agents to transact autonomously.

Stripe and OpenAI first unveiled plans for the protocol last year after partnering to bring direct payments to ChatGPT. While the protocol runs on Tempo’s blockchain, MPP was designed to integrate with other payments rails, including digital wallets and cryptocurrencies.

One of the key features of the protocol is that it supports “sessions,” where after funds and instructions are determined upfront, allowing agents to carry out multiple transactions with no further interaction.

Sorting the Shared Language

While the session capability is notable, there are still lingering doubts about consumer and business appetite for agentic commerce. Data from Coinbase’s agentic commerce protocol suggests that most transactions on the platform still consist of pilots and trials.

Still, this hasn’t stopped leading payments firms from developing their own agentic commerce protocols, including platforms from Google, Visa, Klarna, and others. Because these protocols are intended to function as a shared language for agentic commerce, the increasingly fragmented landscape could create challenges for merchants, financial institutions, and consumers seeking to develop cohesive strategies.

The post Stripe Launches Tempo Blockchain to Power AI-Driven Payments appeared first on PaymentsJournal.

A record 111 million U.S. consumers were carrying a balance on their credit cards at the end of last year—two million more than at the end of 2024. Together, these cardholders now owe more than $1 trillion to banks.

Based on average outstanding balances, a typical cardholder making only the minimum payment would pay about $251 per month, or more than $3,000 per year. Meanwhile, interest would continue accruing on roughly 98% of the remaining balance.

Seeking a Solution

These figures come from researchers at the Century Foundation, a progressive think tank, and the nonprofit Protect Borrowers. While the groups cite these numbers to argue for lower credit card interest rates, the broader picture is more complex.

The Century Foundation supports a proposed 10% annual interest rate cap backed by President Trump and some Democrats, including Massachusetts Senator Elizabeth Warren. However, industry experts warn that capping rates at such a low level could significantly reduce access to credit cards for many households.

For one thing, rates have already begun to edge down, albeit slightly. Borrowers paid an average annual percentage rate of 22.3% in Q4 2025, according to the Federal Reserve, down from 22.8% in 2024.

Consequences of Capping Rates

The Century Foundation estimates that a 10% cap would have saved consumers $134.5 billion since Trump took office. Critics counter that such a cap would likely have restricted access to credit for many borrowers, rather than simply lowering their costs.

Separate data from Javelin Strategy & Research suggests that the cost of lending was about 13% in 2025. At a 10% cap, lenders would likely scale back lending to all but the most creditworthy borrowers—potentially those with FICO scores near 800 or higher. In practice, that could limit access to credit to roughly 200 million Americans, or about 80 million households.

“This research overlooks the fact that credit cards are helping many people affected by persistent inflation, rising rates, and an uncertain economy,” said Brian Riley, Director of Credit at Javelin. “Without access to credit cards, consumers will not have access to short-term borrowing tools that keep them afloat when the budget runs tight, the car starts to sputter, or an unexpected emergency arises.”

“Don’t blame credit card issuers, who bear the risk for the floundering economy,” he said. “Look upstream at inflation, unemployment, and household budgets in disarray. That’s the real issue.”

The post As Credit Card Balances Hit Record Highs, Is a Rate Cap the Answer? appeared first on PaymentsJournal.

In many ways, OpenClaw represents the next evolution in artificial intelligence. Part of its appeal lies in its architecture: the AI agent runs locally on a user’s device, enabling it to interact with applications and perform tasks autonomously.

The platform’s promise has attracted considerable consumer attention—so much so that it has reportedly driven a spike in prices in China’s secondhand MacBook market. As with many rapidly growing ecosystems, however, this surge in popularity has also drawn the interest of cybercriminals.

According to OX Security, bad actors have been contacting many OpenClaw developers via GitHub, informing them that they had been selected to receive $5,000 of CLAW tokens. Those who engaged were redirected to a convincing replica of OpenClaw’s official website, modified to include a “connect your wallet” prompt.

If a user connected their crypto wallet, bad actors could potentially drain its contents.

Many Red Flags

Despite the apparent legitimacy of both the message and the site, the campaign contains several clear red flags. Most notably, while many platforms issue governance tokens or cryptocurrencies, OpenClaw does not—meaning there is no such thing as a CLAW token.

OpenClaw creator Peter Steinberger has also emphasized that any crypto-related outreach claiming to originate from the project is fraudulent. The platform was designed as an open-source, non-commercial initiative and doesn’t conduct giveaways or promotional campaigns.

Capitalizing on Newness

Phishing schemes that impersonate popular brands are a mainstay in cybercriminals’ playbooks. While many users might dismiss a similar message from a more familiar organization, criminals are exploiting OpenClaw’s novelty—targeting users who are intrigued by its capabilities but not yet fully familiar with how it operates.

As AI continues to expand in both capability and reach, concerns around fraud and abuse are likely to grow in parallel. Jensen Huang, CEO of Nvidia, has described OpenClaw as “the next ChatGPT” and “the largest, most popular, the most successful open-sourced project in the history of humanity.” With that level of visibility, and with OpenClaw’s access to core device functions, security threats on the platform could carry particularly far-reaching consequences.

The post Cybercriminals Aim to Capitalize on OpenClaw’s Prominence appeared first on PaymentsJournal.

In a long-awaited announcement, the Securities and Exchange Commission has adopted a largely hands-off approach to regulating cryptocurrency. In coordination with the Commodity Futures Trading Commission (CFTC), the SEC declared that most digital assets will not be considered securities under federal law, including stablecoins and major crypto assets like Bitcoin, Ethereum, and Solana.

The SEC said the new guidance is intended to support innovation in the crypto sector, marking a shift from the agencies’ approach under the previous administration. Under the Biden administration, the SEC focused primarily on enforcement in the crypto space. Then-SEC Chair Gary Gensler had maintained that most cryptocurrencies qualified as securities.

The New Taxonomy

The new framework divides crypto assets into five categories:

• Digital commodities
• Digital collectibles
• Digital tools
• Stablecoins
• Digital securities, which SEC chair Paul Atkins defined as traditional securities using new technology

Only the final category will be treated as securities and subject to the SEC’s full regulatory scrutiny.

“This is good news,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “Despite the ETFs and the growing participation in crypto investments over the last few years, most investors—especially at the institutional level—do not want to get involved a potential investment that doesn’t have a clear regulatory framework.”

Further Defining a Security

The guidance also allows certain assets to lose their status as regulated securities under specific conditions. A digital asset may be deemed a security when it is offered as an investment with an expectation of profits derived from the efforts of others. However, the existence of an investment contract involving a non-security crypto asset doesn’t, by itself, convert the asset into a security. According to the guidance, such investment contracts conclude when the issuer has either satisfied its stated obligations or failed to meet them.

The framework further clarifies the division of authority between the SEC and the CFTC. The SEC will oversee investment contracts and tokenized securities, while the CFTC will regulate digital commodities and crypto-based derivatives.

While the crypto industry has largely welcomed the guidance, the outcome was widely anticipated given the Trump administration’s generally crypto-friendly stance.

“It’s been expected that most, if not all, won’t be classified as securities,” said Hugentobler. “That’s probably why markets aren’t moving on it, since it’s priced in. Had it been the other way around, we’d see a bigger selloff and have more challenges to deal with.”

The post In a Hands-Off Move, the SEC Says Most Crypto Is Not a Security appeared first on PaymentsJournal.

Third-party fintech companies have transformed financial services and accelerated the rise of open banking, but their access to sensitive customer data continues to introduce significant risks.

While the U.S. has largely allowed industry participants to address these challenges on their own, countries like New Zealand have adopted a more regulatory approach. After instituting open banking rules in December, New Zealand’s regulators have indicated they plan to move forward with more extensive reforms.

The objective of these efforts is to secure open banking interactions, drive competition among domestic financial institutions, and imrpove payments efficiency.

“It is great that New Zealand is approaching open banking from a regulatory perspective,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Mandating compliance forces the banks to invest in the technology and creates a level playing field. Of course, retailers are excited about the potential for lower fees compared to card-based transactions, but enabling the technology is only the first step to making direct bank payments a reality.” 

Developing the Standard

One of the main steps New Zealand’s banks have taken is the development of standardized application programming interfaces (APIs), which allow authorized third-party firms to access data and perform services—provided customers give consent.

Similar to the revised Payments Services Directive (PSD2) implemented by the European Union, New Zealand’s framework also aims to reduce the practice of screen scraping, in which non-bank providers extract financial data for use within their own platforms.

Secure APIs help mitigate the need for screen scraping, along with the associated security and privacy risks.

Challenges and Advantages

In addition to enhanced security, pay-by-bank options offer consumers an alternative payment rail at a time when many are burdened by debt from credit cards and buy now, pay later loans.

For merchants, adding account-to-account payments means they also have an alternative to card networks and their associated interchange fees. However, implementing pay-by-bank functionality presents its own set of challenges.

“Merchants must also make the investment to connect to the new payment rails being built by the banks, and consumers need to see a clear value proposition to paying via open banking versus using their cards,” Apgar said. “Card payments have become remained popular with consumers because of rewards structures and easily accessible dispute mechanisms with zero liability.”

The post New Zealand’s Regulators Expand Open Banking Efforts appeared first on PaymentsJournal.

Sending money across borders has traditionally meant navigating delays, fees, and uncertainty. Digital assets are rewriting that experience. They reduce reliance on currency conversions, provide greater visibility into transactions, and drastically lower fees and settlement times.

These same advantages extend to consumers travel abroad. Bolstering inbound tourism is a key driver behind Crypto.com’s partnership with KG Inicis, a payment platform that commands roughly 40% of South Korea’s payments market.

“This is significant, plugging Crypto.com Pay into South Korea’s largest payment gateway network,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “This enables faster, cheaper cross-border transactions and it aims to boost adoption. For Crypto.com to be successful, they need to ensure smooth and seamless point-of-sale integration and user experience, in addition to working with regulators.”

“I’d imagine stablecoins will be used more than a typical cryptocurrency, but providing optionality is key at the end of the day,” he said. “From my understanding, the crypto payments will be instantly converted to KRW (South Korean won) and merchants are paid immediately in KRW. So the volatility is already removed on the back end.”

Managing Volatility

The growing demand for payment flexibility is also fueling the rise of payment gateways. Although crypto gateways initially emerged as a way to enable crypto at checkout, they have rapidly shifted into full-scale payment orchestration platforms.

This has been due in part by the expanding digital asset ecosystem—including cryptocurrencies, wallets, stablecoins, and supporting infrastructure. At the same time, crypto gateways address one of the most persistent barriers to merchant adoption: volatility.

While direct crypto gateways allow merchants to accept and hold digital assets, many prefer an indirect method in which transactions are automatically converted into fiat currency by the gateway provider.

Giving Tourism a Lift

By mitigating volatility risk, these solutions have made crypto acceptance more accessible. Although lower transaction costs, faster settlement, and enhanced security are compelling benefits, rising customer demand remains the primary driver of adoption.

According to a survey by PayPal and the National Cryptocurrency Association, merchants frequently receive inquiries about crypto payments, especially from millennial and Gen Z customers.

As younger consumers prioritize experiences—from dining to travel—integrating crypto payment options is a natural step for businesses and destinations looking to boost tourism.

The post Crypto.com Brings Crypto Payments to Tourists Visiting South Korea appeared first on PaymentsJournal.

The latest extension of the longstanding partnership between Visa and Fiserv has the potential to be a game-changer in Europe, where merchants have long faced the challenges of operating across multiple markets with fragmented payment processes.

The Visa Acceptance Platform will be embedded into Fiserv’s acquiring environment, with the aim of creating a more unified, cloud-based infrastructure across the region. The API-driven acceptance layer is expected to impact both fintech firms and retailers in the EU.

The platform offers a single integration point into Visa’s acceptance services, consolidating access to authorization, data enrichment, and network connectivity within a cloud-native environment. In practice, this may help merchants improve approval rates, manage fraud and chargebacks more effectively, and streamline the checkout experience.

“Merchants benefit from a single point of integration that is both simpler and more robust that what was previously available,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Merchants and fintechs are able to get to market faster, realize better authorization performance, reduce settlement complexity and benefit from powerful data analytics all through a streamlined API connection.”

A Way to Enable the Clients

Its impact may extend beyond in-store payments. The platform is also intended to simplify onboarding processes and reduce backend complexity for fintechs and financial institutions, while supporting faster payments and richer transaction data—though the extent of these benefits will depend on adoption and execution.

“Visa has done a great job in bringing this tech to market and positioning it in a way that enables their clients rather than competing with them,” Apgar said. “Legacy processors have struggled to re-engineer their platforms not just into API connectivity, but cross-connecting systems to enable clients to do more with fewer APIs. Connecting to the Visa Acceptance Platform and making that available to their clients was a very strategic move by Fiserv, and greatly accelerates the value they bring to the market.”

Expanding in Other Regions

Visa has rolled out related initiatives in other regions. Earlier in March, it introduced its Intelligent Authorization orchestration tool in the Asia-Pacific region, positioned as a single-API pathway for acquirers to route transactions across card network infrastructure.

In the U.S., Visa recently launched Visa & Main, a platform focused on small business support. The offering is intended to improve access to capital and provide operational tools, though impact will likely vary depending on uptake among entrepreneurs.

The post Visa and Fiserv Roll Out Unified Payments Platform in Europe appeared first on PaymentsJournal.

The UK’s £100 limit on contactless payments is being scrapped this week, potentially allowing shoppers to tap for purchases of any size. But whether consumers will actually be able to do so depends on their banks—many of which appear reluctant to loosen the cap.

Currently, any contactless purchase above £100 is automatically converted into a chip and PIN payment. Allowing higher-value taps could expose banks to larger instances of fraud, so payment providers will need robust monitoring and security measures in place before lifting the cap.

Contactless payments have already become the dominant way UK shoppers pay in stores. According to Barclays, 94.6% of eligible in-store card purchases were contactless in 2024, suggesting that expanding tap-to-pay capabilities could benefit many players in the payments ecosystem.

“It’s a win for card issuers and certainly networks like Visa and Mastercard who are still very much tied to physical card products,” said Ben Danner, Senior Analyst of Debit at Javelin Strategy & Research. “It’s more convenient for those wishing to use a physical tap to pay. However, fraud monitoring will continue to be extremely important.”

Banks Likely to Keep Limits

Early indications show banks are wary of the added responsibility. While the elimination of the cap was announced in December, the UK’s Financial Conduct Authority (FCA) said feedback indicated that most banks and payment service providers are likely to maintain their existing contactless limits for the foreseeable future.

“I expect banks to still implement some type of trigger controls, especially for flagged transactions or payments that look suspicious,” said Danner. “However, it does encourage larger value physical card use more.”

No Caps on Mobile Phones

The £100 cap has applied only to physical cards, which typically require a four-digit PIN for higher-value transactions. Mobile payments, by contrast, have no such limits because devices usually rely on built-in authentication such as PINs or biometrics.

Data from UK Finance found that more than half of UK adults surveyed now use mobile wallets for both online and in-store purchases. Although physical cards lack these built-in defenses, consumers are protected because card issuers must reimburse funds in cases of fraudulent use.

The post UK Banks Wary as Contactless Payment Limits Are Lifted appeared first on PaymentsJournal.

American Airlines is betting that miles are more than just a ticket to the skies. The airline has launched prepaid cards for AAdvantage members, letting them redeem points at popular retailers and restaurants—a strategy aimed at boosting engagement and reaching travelers who rarely cash in on flights.

The new offering joins similar programs from competitors Delta and United Airlines. Members can redeem miles for gift cards from retailers like Sephora, Target, and Best Buy, as well as fast-food chains like Chipotle, Starbucks, and Panda Express.

The gift card program offers a streamlined way to partner with a wide variety of retailers without requiring them to accept points directly at checkout, as hotels in the AAdvantage network do. American Airlines manages the program through a backend card mall and chooses which brands to feature, while participating retailers don’t need to make any technical changes to take part.

New Options for Redemption

By converting miles into cash equivalents, American Airlines may encourage more frequent redemptions, rather than having members hoard points for free flights.

That said, gift cards may not be the most efficient use of rewards. According to an analysis from the Upgraded Points website, gift card redemptions return around 0.7 cents per AAdvantage mile, while miles are generally valued at 1.4 cents each—effectively cutting their value in half.

Reinforcing Loyalty

Still, as a marketing tool, the prepaid cards make sense. Expanding the ways members can use miles broadens the program’s appeal, especially to travelers who might not full utilize traditional rewards.

“Rewards and incentive options beyond your core brand are becoming much more common as a way to both encourage redemption and continued loyalty to the issuer, in this case the airlines,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “For airlines, their core loyal base wants to extend their enjoyment of their travel experience to other necessities. This could be anything from getting beach supplies for that vacation or using a gift card to upgrade their hotel room. In the end, the redeemer leaves with a more positive opinion of the airline for extending their redemption opportunities.”

American Airlines has taken other steps to makes its miles more flexible. The AAdvantage Exchange Marketplace, launched last year, allows members to redeem miles for premium retail items, and the airline has also added options like redeeming miles for in-flight Wi-Fi.

The post American Airlines Introduces Gift Cards for AAdvantage Members appeared first on PaymentsJournal.

One of main challenges in combating scams is defining them properly. Romance, investment, and impersonation scams can take many forms and arrive through a wide range of channels.

Another critical issue is communication. One financial institution may uncover and address a scam affecting one of its customers, but upon further examination, that incident may be just one part of a global campaign orchestrated by a fraud ring.

To address both challenges, the Global Anti-Scam Alliance (GASA) is launching scam.org, a platform that offers resources including scam education, reporting tools, prevention guidance, and victim support. The platform will be AI-powered through integration with OpenAI and has secured buy-in from many of the world’s leading cybersecurity firms.

“This is a meaningful partnership and highlights the great work GASA is doing,” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research. “A relatively new entrant, GASA has made significant strides over the last 18 to 24 months to bring the global community together to address social-engineering risks.”

An Agnostic Threat

This industry-wide approach has become increasingly necessary as scams continue to spiral out of control. Recent data from BioCatch found respondents reported a 65% year-over-year increase in the total number of scams between 2024 and 2025. These scams are becoming agnostic, targeting industries, demographics, and platforms with equal ardor.

This threat would not be able to reach such scale without two factors: technology and organization. Criminals can now use AI to make their communications appear more legitimate, while the cloud model has enabled the rise of cybercrime-as-a-service operations.

For example, the Tycoon 2FA phishing toolkit was sold as a subscription service on social media. The toolkit was recently taken down, but not before playing an integral role in more than 100,000 breaches across a variety of organizations.

An Overarching Approach

Taking down Tycoon2FA required a coordinated global effort between law enforcement, technology companies, and cybersecurity firms. A similarly broad approach will likely be required to quell the threat of scams.

Scam.org can play a key role by facilitating data-sharing and communication that will be critical to that fight. The platform will also give consumers a resource they can turn to at a time when many scam victims feel isolated and powerless. Ultimately, however, its success may depend on whether consumers are willing to report what happened to them.

“While the mobile app security features included in Scam.org are notable, consumers will still be expected to make decisions about what is suspicious and what is not,” Goldberg said. “Ultimately, helping consumers remove their mobile numbers from robocall lists and protect and remove their compromised PII on and from the dark web will be the only solution that stops SMS-based, smishing scams.”

The post Global Scam Reporting Platform Launches with OpenAI Support appeared first on PaymentsJournal.

Six years after the Group of 20 (G20) introduced an ambitious roadmap to address long-standing inefficiencies in cross-border payments, global regulators say progress has been made—but many of the most persistent problems remain unsolved. In a recent keynote address, Financial Stability Board (FSB) chair Andrew Bailey assessed how far the effort has come and where it still falls short.

Speaking at the FSB Payments Summit, Bailey pointed to the increased adoption of international standards as one of the most significant developments in recent years. These advances include the implementation of the ISO 20022 messaging protocol, expanded operating hours of financial institutions to better accommodate international payments, and stronger anti-money laundering and counter-terrorism financing standards.

Despite these achievements, there has been little improvement in the end-user experience. Delays, high fees, and lack of transparency in cross-border payments are still as prevalent today as they were decades ago.

Left unchecked, Bailey warned, these persistent frictions could erode the stability of the global financial system and ultimately stymy economic growth.

Unforeseen Developments

Bailey also reiterated FSB guidance from last year indicating that G20 countries are unlikely to meet the cross-border payment efficiency targets set for 2027. While uneven implementation of standards across member nations is partly to blame, a number of unforeseen developments have also complicated progress since the roadmap was created.

Technologies such as artificial intelligence, cloud computing, and digital assets are rapidly reshaping expectations for financial services firms. At the same time, fraud has become far more sophisticated—driven in part by these same technologies—posing a growing threat across payment channels, especially in cross-border payments.

The Four-Part Plan

To combat these issues, Bailey outlined a four-part plan. First, public-sector entities should create local action plans to ensure international recommendations are effectively implemented at the domestic level. Second, they should prioritize innovation and modernize infrastructure to better support cross-border payments.

Third, Bailey called on member nations to reduce regulatory compliance costs, noting that the FSB has identified numerous cases in which regulatory hurdles have slowed cross-border payments. Finally, he emphasized that greater participation from the private sector will be key to reshaping international transactions.

Calls for a consortium-based approach have grown more common as the financial services industry confronts complex challenges, including fraud. In the context of cross-border payments, Bailey noted that deeper collaboration between public and private stakeholders will be essential to ensure regulators focus on the most pressing issues and take effective action.

The post FSB Chair Calls for a Consortium to Tackle Cross-Border Payments Woes appeared first on PaymentsJournal.

As some merchants continue pushing customers to pay through their apps, one major retailer is moving in the opposite direction. The Florida-based grocery chain Publix recently notified customers by email that its payment app will be discontinued starting March 19.

The Publix Pay app allowed shoppers to store payment methods—including debit cards, credit cards and gift cards—on their mobile devices. In-store, customers could scan a QR code at checkout and complete the transaction using a PIN-protected payment tool.

Publix has not offered a reason for the decision, but it may reflect a challenge common to app-based checkout: distinguishing between customers who paid through the app and those who simply walk with unpaid merchandise.

“Changes to their payment tech stack could have forced this change, but I suspect it was something more basic: inventory shrinkage,” said Don Apgar, Director of Merchant Services at Javelin Strategy & Research. “For example, you can use the app to pre-order deli items, and presumably you could pay through the app as well. The big question is, how does the store confirm payment when you are walking out with the products? This basic problem has thwarted all major retailers from implementing a pay-by-app function.”

Trying to Find Savings

Retailers could stop shoppers who use the app to confirm that payment was made. But assigning an associate to that task would eliminate any labor or time savings. It would also offer little added convenience for customers, who could just as easily stop at a register or self-checkout to pay.

Even if the store can confirm that a payment was made from a shopper’s device, it still must ensure the payment covers everything in the basket. That requires a more sophisticated system than a simple payment app.

“Theoretically, this could be accomplished using an RFID tag on every item and geofencing for your phone,” Apgar said. “As you exit the store, scanners can detect every item in your cart and match them with the payment you made via the app. But this tech is very expensive to deploy at scale, so the question loops back to whether this offers enough convenience to justify the costs?”

Other Options Remain

The app would still have been secure for in-store pickup and home delivery orders, where consumers aren’t leaving the store with items. Going forward, shoppers using those services will pay via the retailer’s website.

Publix customers can still use gift cards stored in their digital wallets, and contactless options such as Apple Pay and Google Pay will continue to work at store registers.

The post Publix Is Shutting Down Its Payment App appeared first on PaymentsJournal.

The capabilities of artificial intelligence have improved exponentially, and AI agents are being delegated increasingly complex tasks every day. However, data from Coinbase’s protocol suggests consumers may not be on board with agentic commerce yet.

The crypto giant launched the x402 protocol last year, designed to use the existing HTTP “402 Payment Required” status code to facilitate instant stablecoin payments. The objective was to give AI agents a mechanism to exchange digital assets as seamlessly as they exchange data.

However, as CoinDesk notes, reports on last month’s usage of the x402 platform found average daily transactions of approximately 131,000, with average daily payment volume of roughly $28,000. Notably, even on the highest-volume day, the activity appeared to consist entirely of testing and trial runs.

Not a Referendum

At first glance, the data runs counter to the prevailing narrative that agentic commerce will soon reshape the retail landscape. In reality, it likely reflects less a referendum on the technology and more a reminder that agentic commerce remains in its early stages.

That point can be easy to lose sight of as examples of agentic-driven transactions become more frequent. Mastercard, for instance, recently facilitated two transactions that expanded both the global reach of agentic commerce and the scope of ongoing pilots.

The Tech Will Have Its Day

As agentic commerce platforms began emerging last year, companies like Google and Visa developed protocols designed not only to power AI agents but also to establish guardrails ensuring those agents operate within defined parameters.

While many of these platforms reached the market last year, transaction volume has yet to materialize. This makes this year pivotal, as merchants, financial institutions, and consumers begin exploring the technology and ironing out any wrinkles.

Given the hype surrounding these platforms, their adoption will be closely scrutinized—as Coinbase has already experienced.

“The potential is still there, I just think the AI integration at scale is what’s holding back adoption.” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “It’s going to take some time for most FIs to adopt agents and therefore use Coinbase’s agentic solution. This tech will have its day but might just take some time to adopt.”

The post Agentic Commerce Traffic on Coinbase’s Protocol Has Yet to Accelerate appeared first on PaymentsJournal.

The original Bilt card, sponsored by Wells Fargo, was a good effort, but the revenue dynamics didn’t work. It is not the first failed co-brand to step outside the realm of successful airline and travel partnerships. The opportunity looked promising—about a third of American households rent—but the known obstacle remained: landlords willing to part with a portion of their profits.

Was it that Bilt required their loyalty infrastructure to be the focus rather than the bank card model? What about mis-forecasting interest revenue because cardholders figured out how to game the system? Or was it just a bad marriage? Time will tell, but there are many gory details in this WSJ article.

Replacing Wells with a Small Fintech Bank?

Bilt 2.0 is off to a weak start. It looks like Wells Fargo was correct—this variation of the successful credit card co-brand model might scale, but it loses money. Now, instead of a card issuer, in business when Mastercard was Master Charge, and Visa was Bank Americard, a tiny fintech looks to replace the model that a top issuer couldn’t get to work.

Instead of a top Wall Street bank leading the charge, Bilt’s new partner is a fintech bank, named Column, NA. Column is no Wells Fargo (or BoA, Chase, or Citi, for that matter). Originally named the Northern California National Bank, it turned into a fintech bank in 2021. The bank is FDIC-insured for deposits and its national bank charter allows it to offer loan products such as credit cards. Their current assets (loans, in bank-speak), are under $1 billion, and their liabilities (deposits) are slightly more than half that. In their latest report to the FFIEC, Column NSA reported $25,000 in credit card interest earned in December 2025. Compared to Wells Fargo, that is a rounding error.

Off to a Rugged Start

Forbes reports broad dissatisfaction with the new card. Payments are not hitting properly—instead of allowing cardholders to harvest points from their shelter payments, the payments are getting lost in cyberspace. The customer service function is a mess and relies on very confused AI chatbots. Pristine credit-scored accounts are racking up late notices, and Bilt has been ineffective in providing backup support. Cardless, the program sponsor, is reported to be unresponsive.

I Know Credit Cards, and Bilt 2.0 Looks Like a Miss

After more than four decades in credit cards, I can confidently call the shot on what is a winner and what is a loser. Javelin even has a reconnaissance tool for top issuers, known as Card Bench, that reports changes to rates, rewards, or terms within minutes of the event.  But this won’t displace many cards in the market, I promise.  

As Wells exited, they offered to convert Bilt Cards to their Autograph card product, a reward-rich, good-credit-limit card suitable for general-purpose use.  I don’t have an Autograph card, but I can tell you I’ve never had an issue with Wells Fargo, and if I call customer service right now, there will be a live agent on the phone, with no more than a momentary wait. And all my payment transactions to pay and charge will go through, as you’d expect with any Mastercard or Visa payment.

Learning moment: forget about non-standard co-brands, especially those that have competing loyalty systems. And, a good partnership relies on a solid relationship, where all parties win.

The post Bilt 2.0: All Dressed Up and Nowhere to Go appeared first on PaymentsJournal.

The great American coin-op laundromat may be nearing the end of its lifespan. A new poll finds that more than half of self-serve laundries in the U.S. now generate the majority of their revenue from cashless payments.

The survey underscores the shift: slightly more than half of respondents say that much of their self-service machine revenue comes from payment types other than coins or cash bills. Among stores that offer digital or card-based payment, 52.3% report that cashless transactions have increased significantly over the past three years.

Many laundromats have already moved well beyond cash. Only two-thirds of respondents said they still accept coins, and just 37% reported that coins generate the majority of their revenue. Meanwhile, nearly half accept payment from a mobile app, and another 37% accept credit or debit cards.

A Range of Benefits

Customer convenience is driving much of the transition, with 70% of operators citing it as a key reason for adding or considering cashless payment options. But owners are seeing other benefits as well.

Digital payments provide data that can help operators better understand customer habits and refine their business strategies. Cashless systems also make it easier to implement loyalty programs and enable more flexible pricing beyond the traditional 25-cent increments.Some laundromats are experimenting with time-of-day discounts and other creative promotions. They can also streamline the day-to-day operations.

“Coins are labor intensive,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “On a daily basis, machine coin boxes need to be emptied and the coins counted and returned to the bill changer machines.”

Worth the Cost

There are some drawbacks. Customer friction may deter some users from downloading and using a payment app.

“Adding card payments is an investment for laundry operators,” Apgar said. “They need to spend money on the card devices that either integrate every machine or use a central device that issues prepaid cards from credit and debit purchases. Either way there is hardware, software and set up fees involved, in most cases thousands of dollars.”

On top of that, payment processors charge a fee for every transaction, typically ranging from 1.5% to 3.5%.

Even so, most operators report a positive return on investment from increased sales and reduced operational costs. Some laundromats have seen revenue jump between 17% to 22% after introducing card payments—gains that suggest the era of the traditional coin-op laundry may be coming to an end.

“Customers like it;” said Apgar. “Most laundromat customers are regulars, there because they don’t have a washer/dryer setup at home. Loading a prepaid card helps them budget for laundry costs and is safer to give to dependents vs. cash.”

The post Cashless Payments Gain Ground at Self-Serve Laundries appeared first on PaymentsJournal.

Consumers can now pay with everything from digital wallets to crypto and real-time payment rails—and merchants increasingly expect to support them all. That shift is putting new pressure on merchant acquirers, the financial institutions responsible for processing payments on merchants’ behalf.

Acquirers now face fresh challenges as payment methods grow more complex. To help address these, Visa is launching its Intelligent Authorization platform for acquirers in the Asia-Pacific region.  

The platform is designed as a single-API pathway that allows acquirers to process transactions using the infrastructure of card networks. This can eliminate the need for banks to build dedicated infrastructure while also delivering operational efficiencies.

“This is an extension of what Visa has been building with their Visa Acceptance Solutions platform,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Historically, Visa has relied on acquirers to provide connectivity to the Visa network, either through their bank’s own tech stack or via a third-party processor like Fiserv or WorldPay.”

“Visa now offers merchant-level network connectivity that enables acquirers of all sizes to bring a competitive processing offering to market,” he said.

Finding the Right Rail

One reason payments orchestration platforms have proliferated is that many banks were never designed to process transactions via technologies such as mobile wallets or stablecoin platforms. However, payments orchestration platforms have the added benefit of providing intelligent payments routing.

This means these platforms can determine the optimal payment rail for a transaction based on factors like speed and cost—and dynamically switch to another option if needed. This flexibility can dramatically reduce declines while saving merchants and acquirers both time and expense.

The Absence of Parameters

When artificial intelligence is added to the mix, routing decisions can become even more dynamic. AI agents now have the capability to navigate the complexities of the modern payments landscape and make real-time routing decisions, even without predefined parameters.

As AI agents begin to play a greater role in payments orchestration, these platforms could also help accelerate the growth of agentic commerce. With many financial institutions evaluating infrastructure strategies for AI-driven transactions, streamlined payments orchestration should be a key consideration.

The post Visa Enhances Payments Orchestration Tools for Merchant Acquirers appeared first on PaymentsJournal.

Three Irish banks are launching a new peer-to-peer (P2P) payment service Zippay, which is going live this week. The platform is designed to compete with Revolut, which already has around 3 million P2P users in Ireland.

Zippay will initially be available to more than 5 million customers served collectively by AIB, Bank of Ireland, and PTSB. The service is expected to expand later to other European financial institutions that offer IBAN-based accounts.

The launch echoes a similar strategy in the U.S., where seven banks joined forces in 2017 to form Zelle to compete with Venmo.  

Rather than requiring a standalone app, Zippay will operate within participating banks’ existing banking apps. Customers will be able to send up to €1,000 per day and request up to €500 per transaction. Like Zelle in the U.S., the service will offer consumers free access to instant payments. The underlying infrastructure is provided by the Italian payment technology provider Nexi.

“Digital and mobile payments are popular in Ireland, so we expect consumers are primed and ready for adoption of this new bank integrated platform,” said Ben Danner, Senior Analyst, Debit at Javelin Strategy & Research. “Zippay is a way for the banks to compete with fintechs like Revolut, who are grabbing a significant share of P2P payments in Ireland. It’s a similar story in the U.S. where Zelle competes with fintechs like PayPal and Venmo as well as Block’s Cash App.”

Second Chance

This isn’t the banks’ first attempt to build a shared payments platform. In 2020, the same three institutions—along with KBC Bank Ireland—launched a project called Synch to develop a standalone payments app known as Yippay. The initiative was abandoned in 2023 after KBC Bank Ireland closed.

The earlier effort also encountered regulatory hurdles. Requirements from the Central Bank of Ireland related to launching a new standalone app would have delayed the rollout by at least a year. By integrating Zippay into their existing banking apps, the banks avoided those additional approval requirements.

Facing the Competition

For consumers, Zippay may offer certain advantages over Revolut. As an e-money institution rather than a bank, Revolut operates under different regulatory constraints, including limits on customer deposits in some markets. Deposits held with banks participating in Zippay are protected by national deposit guarantee schemes, such as the Financial Services Compensation Scheme, which insures deposits up to £85,000 if a bank fails.

Zippay will also compete with SEPA Instant Credit Transfer, which has been available to consumers in Ireland for just over a year. Developed with support from the European Commission and the European Central Bank, SEPA Instant enables cross-border transfers of up to €100,000 in 10 seconds or less.

The post Irish Banks Launch Zippay, a Zelle-Like P2P Payment Service appeared first on PaymentsJournal.

Group of 20 (G20) nations have committed to making cross-border payments more efficient, but regional complexities and outdated infrastructure have made progress slow.

The correspondent banking model adds another layer of complexity, requiring multiple banks to shuttle payments across borders. While the Swift messaging network has long served as the global hub connecting these banks, challenges remain.

This is why Swift proposed new rules for retail cross-border payments last year. Over 25 banks have signed on and will begin processing payments under this framework by June.

This marks a strategic shift for Swift, which has historically focused on intrabank and commercial payments. Rising consumer demand for cross-border payments and remittances—particularly in major markets like India, China, Pakistan, Germany, and Bangladesh—has prompted the network to broaden its focus.

Appetite for Expansion

Small businesses are also eager to expand their footprint internationally, especially younger entrepreneurs from Gen Z and millennial cohorts. Yet, delays, transaction fees, foreign exchange complexities, regional regulations, and lack of payment visibility have long been persistent pain points for cross-border payments.

Swift’s new framework aims to mitigate these challenges by providing cost transparency, traceability, and near-real-time settlement in many cases. The network expects additional payment rails to join by the end of the year.

Faster Than Benchmarks

This efficiency would be welcomed in a market that has continued to face challenges. After spotlighting the critical role of cross-border payments in the global economy five years ago, G20 nations developed a strategy to make international transactions more efficient and transparent by 2027. A recent progress report, however, indicates minimal advancement—falling short of expectations.

Already, roughly 75% of payments on Swift’s network reach the beneficiary bank in under 10 minutes, faster than the G20 benchmark. With the new rules, that percentage is expected to climb even higher.

The post Swift Moves Ahead with Retail Cross-Border Payments Network appeared first on PaymentsJournal.

The European Central Bank has invited licensed payment service providers (PSPs) to help shape the long-awaited digital euro as it enters its pilot phase—a chance to prove the currency still has a role in the global payments landscape.

Participating PSPs will test the technical and operational readiness, evaluate the user experience, and experiment with communication, branding, and marketing approaches. The digital euro is expected to launch in the second half of 2027.

What PSPs Should Look For

Feedback from PSPs will influence the asset’s technical development, helping to identify and avoid potential pain points before its official rollout.

“If PSPs have to rebuild plumbing every time a spec or nuanced change is made, this won’t work, so it needs to have solid API and software development kits for integration,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “It needs to be simple and easy to use and integrate. They need to push for a credible, banking type commercial model.”

“The liability and fraud part is going to be tricky, so they need to ask for clear and specific rules for these types of situations,” he said. “They also need a ‘standardized integration’ stack or package to enable seamless integration and greater adoption. No one participating should be reinventing the wheel here, but a solid framework needs to be in place or it won’t gain traction.”

One drawback of the pilot is that PSPs are expected to build, onboard, certify, and operate the digital euro at their own expense. As a result, participation is likely to be limited to the largest players. 

A Difficult Path

The digital euro’s journey has been challenging since its inception in 2020. Originally designed to counter the growing influence of foreign currencies and global payment networks such as Visa and Mastercard, it now faces competition from stablecoins, which have assumed a key role in cross-border payments—one the digital euro was meant to fill.

The pilot may be the final test to determine whether the digital euro can carve out a meaningful place in payments. But the question remains: does it still have a future?

“There are a lot of nuances there, but the short answer is no,” Hugentobler said. “I think what the current administration is doing and pushing for will strengthen stablecoins and the U.S. dollar even more, potentially squeezing out others.”

The post Digital Euro Enters Pilot Phase, with Questions Around Its Viability appeared first on PaymentsJournal.

One of the most prolific phishing-as-a-service toolkits of all time was not widely used to send consumers phony unpaid toll texts or urgent account alert emails. Instead, Tycoon 2FA was primarily leveraged to target paid accounts associated with organizations.

Although financial services and healthcare companies have typically been prime targets for fraud attempts, cybercriminals appeared to deploy Tycoon 2FA more arbitrarily. According to The Hacker News, the tens of millions of phishing messages created with the platform led to breaches at over 100,000 organizations across industries, including schools and hospitals.

The worldwide phishing threat spawned by the toolkit prompted a coalition of public and private entities to band together and take down the service. This alliance included Europol and other law enforcement agencies, Microsoft, cybersecurity firms, and Coinbase. This effort ultimately resulted in the takedown of the 330 domains that formed the criminal network’s infrastructure.

“International, coordinated efforts to take down organized cybercrime rings, cybercrime-as-a-service networks, and phishing-as-a-service networks—like this one—are necessary,” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research. “But sadly, these takedowns only result in short-term gains, as new networks and models quickly step in to replace the ones taken down.”

Streamlining Cybercrimes

Prior to the disruption, a monthly subscription to Tycoon 2FA could be purchased on social media platforms like Telegram for roughly $350. In return, users gained access to a dashboard where they could create and monitor phishing campaigns, along with templates and tools designed to streamline cybercrime.

As with many phishing attacks, these tools were used to craft messages impersonating widely used services like Outlook, SharePoint, and Gmail. The goal was to capture sensitive data such as login credentials or multi-factor authentication codes. Once stolen, the information was often transmitted to criminals in near real time.

A Massive Issue on Multiple Fronts

One of the most alarming aspects of phishing-as-a-service platforms is how they simplify the process for novice bad actors and dramatically expand the reach of their campaigns. These services are also highly customizable. Microsoft attributed much of Tycoon 2FA’s success to its ability to convincingly mimic legitimate authentication processes.

Even more concerning, Tycoon 2FA subscribers were able to engage in ATO jumping. After compromising an account, criminals could send phishing messages from that email address, making them appear to come from a trusted user.

This means a single phishing message can quickly spiral into a major problem for organizations on multiple fronts.

“Law enforcement is caught in a perpetual state of reaction when it comes to fighting cybercrime,” Goldberg said. “From a global perspective, U.S. consumers and business, which are typically the primary cybercrime targets, pay the price. In the case of Tycoon 2FA, the vast majority of compromised targets were in the U.S., followed by the United Kingdom and Canada.”

The post Authorities and Tech Firms Team Up to Take Down Phishing Platform appeared first on PaymentsJournal.

Robinhood is jumping into an already crowded premium credit card market with the invite-only Robinhood Platinum Card. With a $695 annual fee and a range of perks, the card will compete with established offerings such as Chase’s Sapphire Reserve and the American Express Platinum Card, which carry fees of $795 and $695, respectively.

Expected to launch in Q2, the card will offer 5% cash back on dining and flights booked through its travel portal, along with 10% cash back on hotels and rental cars booked through the platform.

Cardholders must have a Robinhood Financial brokerage account to redeem the rewards they earn. Cash back is deposited directly into that account, where it can be used through the company’s travel portal or with select online merchants.

Tough Crowd

The card is aimed at affluent, high-spending households, though that segment is already heavily targeted by established premium cards.

“Robinhood’s new card is interesting, but they certainly will need to brace themselves for some well-established credit cards in this space,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “Javelin’s Card Bench indicates that the Robinhood card, issued by Coastal Bank, will have to compete against American Express’ Schwab Investment and Platinum Card, Bank of America’s Merrill Lynch Premium Rewards Card, Wells Fargo’s Advisor’s Card, UBS Bankcard, and U.S. Bank’s Raymond James Reserve Rewards+.

“Entry into this space requires that the card not only meet the standards of a premium credit card, but it also must be supported by a trading account,” he said. “That goes far beyond the standards of a block and tackle general purpose credit card.”

Building on the Gold Card

The launch is part of Robinhood’s broader push into consumer-finance services following the introduction of its Gold card in 2024. The company says that card now has more than 7 million holders and about $10 billion in annualized spending. Robinhood has also introduced wealth management and private banking features over the past year as it seeks to deepen engagement within its app.

“Robinhood’s Gold Card has experienced moderate success in the market,” said Riley. “With the new fee, Robinhood will need to ensure it can attract and retain high net worth customers with more than just baseline rewards. Cardholders in this space require a broad range of financial services, whether they rely on firms like American Express or U.S. Bank.”

The post Robinhood’s Platinum Card Enters a Packed Premium Market appeared first on PaymentsJournal.

The idea of a limited-scope, or “skinny,” master account for fintechs has gone from abstraction to reality in just a few short months.

In October, Federal Reserve Governor Christopher Waller proposed a model that would allow fintechs to directly access certain services from the central bank. Until now, many of these companies have relied on licensed banks’ master accounts to operate payment services—a workaround that can become cumbersome and costly as companies scale.

According to the Wall Street Journal, crypto exchange Kraken has secured approval for a limited master account, marking a landmark development for the digital assets industry.

“This is a big deal because it connects directly to Fedwire and reduces reliance on correspondent banks,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “The second order effect is that it proves other non-FDIC insured institutions can be approved—with constraints for now—which will steepen competition for on-ramps, settlement, and potentially stablecoin and fiat management.”

“One step further from there, the third order effects would probably be that banks feel pressure in their ‘gatekeeper roles,’” he said. “There will be further debates about deposit disintermediation if more crypto companies like Kraken get direct access to the Fed’s rails.”

The Bailiwick of Banks

Banks have already voiced concerns. Master accounts at the Fed have traditionally been reserved for insured depository institutions deemed low risk. In exchange for access to the central bank’s rails, those institutions assume substantial compliance burdens and regulatory constraints.

Some financial institutions argue that extending similar access to fintechs—even in a limited capacity—could impact banks’ revenue and market share. Others contend that skinny accounts may not go far enough in safeguarding against fraud and money laundering risks.

Ramping Up the Comfort Level

Kraken will serve as an early test case for this framework. The Fed retains the authority to impose restrictions if necessary, and the exchange will not be permitted to earn interest on reserves or tap the central bank’s emergency lending.

Still, the approval represents a watershed moment for an industry that has grappled with regulatory uncertainty for years.

“Even though this is phased access for Kraken, it’s a good starting point for them to prove it has adequate controls and resilience and adheres to other compliance areas. Aand if all goes well, other services or platforms are likely to scale,” Hugentobler said.

The post Kraken’s Master Account Approval Is a Watershed Moment for Crypto appeared first on PaymentsJournal.

Two of the most consequential trends in payments are converging as Affirm and Klarna begin working with Stripe to allow AI agents to initiate buy now, pay later purchases. The integration relies on Stripe’s Shared Payment Tokens, which enable AI-assisted shopping without exposing sensitive payment credentials.

In a blog post, Viraj Gupta, Product Manager for Cards Vault at Stripe, said the system supports both agentic network tokens and BNPL tokens within a single integration. He added that merchants offering BNPL through Stripe can see revenue gains of up to 14%, along with higher conversion rates and average order values.

A Defensive Position

Affirm and Klarna together serve nearly 150 million users worldwide. Still, the more compelling reason for partnering with Stripe may be a desire not to be sidelined as the payments ecosystem evolves.

In that sense, adoption is a defensive move as agentic commerce starts to take off. BNPL providers don’t want shoppers locked out of installment options simply because a bot, rather than a human, is making the purchase.

“You could assume that the same percentage of buyers who use BNPL today will want to use it with agentic commerce,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Secondarily, nobody can use BNPL if those payments options aren’t available in agentic commerce.”

Categories Ripe for Agentic AI

Agentic commerce remains a small slice of the market, but Apgar’s research highlights several retail categories where shopping bots could have an impact.

Commoditized goods such as paper towels or dish soap, for example, involve little brand differentiation and are often purchased primarily on price. For gift givers, an AI agent could narrow choices based on details about the recipient. And travel sites like Trivago and Expedia already aggregate and compare options. Any of these categories could be ripe for BNPL-enabled agentic purchases.

“A sample prompt could be: ‘Find and purchasethe highest-rated office chair with the best back support that costs less than $400, can be delivered within 10 days, and I can pay for in four installments with no interest,’” Apgar said. “BNPL and payment attributes can actually be a purchase requirement, along with product attributes.”

The post Stripe Brings Agentic AI to BNPL Loans appeared first on PaymentsJournal.

Capital One is beginning to unveil its playbook for the Discover integration, with some of its core credit cards now being issued on the acquired network.

Updated benefits guides, first reported by The Street, show that new customers will receive Capital One-branded cards such as Savor, Quicksilver, and VentureOne on the Discover rails. Existing cardholders likely won’t see changes until their current cards expire, when they are expected to be migrated over.

Slow-Rolling the Integration

For now, the premium and business portfolios appear unaffected, including the flagship Venture X.

“Capital One is hedging its integration by keeping Venture X on the Visa network for now,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “When coupled with the brands selected to be on the four party networks, this recognizes the dominance of Mastercard and Visa networks in payment acceptance. While it does not suggest a long-term plan to remain on those networks, it suggests a thoughtful plan to execute towards the Discover network cautiously.

“Capital One’s business cards, including Spark and Venture X Business, remain on the Mastercard network,” he said. “Discover does not support a large business-card audience, and Capital One recently announced its intention to acquire Brex, a fintech with a substantial commercial card portfolio.”

The issuer is also keeping cobranded partnerships off the Discover network for the time being. That includes cards tied to T-Mobile, Kohl’s, Bass Pro Shops/Cabela’s, among others.

Shuffling the Cards

The merger of Capital One and Discover, completed in May 2025, has been rolling out in phases. The first step came through the debit portfolio, which has roughly 25 million cards in circulation.

Historically, Discover’s card business was centered on a single flagship product, the iT card. By contrast, Capital One is folding multiple rewards franchises into the network—including products with annual fees, a departure from Discover’s traditional structure—along with their no-fee counterparts. Fully consolidating the combined lineup is expected to take years.

“In the long term, it is unlikely that Capital One will operate in two network ecosystems,” said Riley. “We expect it to take five years for the full shift to take place. Converting based on expiration dates is a solid, cautious strategy.”

The post Capital One Starts Migrating Core Cards to Discover Network appeared first on PaymentsJournal.

Late payments are more than just a headache for businesses—they contribute to thousands of closures each year.

Data from UK fintech Funding Circle estimates that roughly 14,000 businesses in the UK fail annually due to the knock-on effects of delayed payments—the equivalent of 38 closures every day. With around 280,000 businesses shutting down in the UK in 2024, late payments were a factor in about one in 20 cases.

Collectively, UK companies are owed an estimated £26 billion in overdue invoices at any given time. The average affected business is waiting on £17,000—nearly $20,000—in unpaid bills. Unsurprisingly, smaller firms bear the brunt of these cash flow pressures.

“Slow and late payments are unfailingly one of, and often the single biggest reason, for small businesses to fail,” said Hugh Thomas, Lead Analyst of Commercial and Enterprise at Javelin Strategy & Research. “This is true for every developed economy we have data for.”

Naming and Shaming the Late Payers

British financial authorities have taken steps to address the issue. The Reporting on Payment Practices and Performance Regulations 2017 requires larger companies to disclose details of their payment practices.

Businesses must report the share of invoices paid within 30 or 60 days, as well as their average payment times. Payment performance data must also be included in directors’ reports—similar in spirit to disclosure requirements overseen by the U.S. Securities and Exchange Commission—giving shareholders and analysts greater visibility.

“Our study from January shows how this legislation has been having a positive effect, driving down UK payment times in aggregate,” said Thomas. “But we’re also seeing that the trend towards faster payment and better terms compliance is not uniform, and that 30% to 40% of UK firms are actually paying slower and missing terms more often now than when the legislation was implemented. One hopes that ongoing efforts to identify and out slow and non-compliant payers will help with the issues cited by Funding Circle.”

Benefits of Transparency

Greater transparency helps suppliers make more informed decisions about whom they do business with. Over time, that could strengthen not just small businesses but the broader UK economy.

According to Funding Circle’s analysis, reducing poor payment practices by just 10% could generate nearly £1 billion in annual economic benefits. Fast payments would likely mean fewer closures, alongside stronger investment and productivity growth.

The post Late Payments Sink Thousands of UK Businesses Each Year appeared first on PaymentsJournal.

An AI agent recently bought a T-shirt—an unassuming purchase that nonetheless marks two milestones for agentic commerce.

First, the transaction took place in Spain, making it Europe’s first fully agentic payment. Second, it was processed by Banco Santander, the first time an agentic commerce transaction has been executed within a regulated banking environment.

The trial, facilitated by Mastercard Agent Pay platform, was designed to ensure that AI agents can complete transactions while banks and customers retain full visibility and control. By successfully operating within the stringent compliance standards of a regulated financial institution, the pilot offers an early blueprint for how agentic payments could be integrated into banking.

Increasing the Scope

Since launching Agent Pay last year, Mastercard has rapidly expanded the platform’s reach. In November, the company piloted it in UAE with Majid Al Futtaim, the retail and hospitality conglomerate, including a use case that enabled an AI agent to purchase movie tickets at a local cinema.

At a recent AI summit in India, Mastercard conducted another agentic commerce pilot with expanded scope. That trial incorporated Mastercard-issued cards from two banks, along with multiple payment processors and merchants—demonstrating how the model can function across a more complex ecosystem.

Scaling the Infrastructure

As AI agents take on a larger role in payments, issues such as security, accuracy, and privacy move to the forefront. Building a durable framework is important—one reason major technology companies are developing agentic commerce protocols that define how agents authenticate, transact, and operate within set guardrails.

The Mastercard and Banco Santander pilots show that agentic commerce can function within the current regulatory and financial infrastructure. But scaling it will still be challenging. Risks ranging from fraud and misuse to technical errors underscore the need for strong controls.

Banco Santander has indicated it will continue testing agentic commerce internally and explore additional use cases. Mastercard, meanwhile, is expected to keep expanding Agent Pay globally—potentially moving beyond consumer transactions and into commercial and enterprise payments.

The post Santander and Mastercard Pilot Agentic Commerce appeared first on PaymentsJournal.

The business case for adopting real-time payments in enterprise settings is compelling. Instant settlement drives efficiency in processes long built around paper checks, while also giving organizations unprecedented control over liquidity and cash flow.

The liquidity advantage is also fueling growth on the consumer side. The Clearing House recently reported that its RTP Network reported two million transactions in a single day and set a new single-day value record of $8.36 billion. The network attributed this growth to adoption across use cases like earned wage access (EWA) disbursements, gig economy payouts, and account-to-account transfers.

“Consumers expect money to move quickly, whether that be from their employer, paying a friend, or a biller,” said Ben Danner, Senior Debit Analyst at Javelin Strategy & Research. “EWA is built around faster access to funds and the same could be said for working gig economy jobs like ridesharing.”

“As budgets tighten, consumers are going to be moving their balances they may have built in wallets and P2P apps back into their banks checking account,” he said. “We’ve seen growth in core deposits suggesting consumers are increasingly relying on their financial institution, which is generally perceived safer than app-based payments.”

Seeking Payments Alternatives

Consumers, meanwhile, continue to navigate persistent inflationary pressures. Many have leaned more heavily on credit cards, but rising default or delinquency risks have prompted lenders to tighten underwriting standards, reduce credit lines, and focus more on affluent segments.

As a result, alternative payment methods have gained traction. Buy now, pay later (BNPL) services have skyrocketed in popularity, even as overall credit card debt levels remain elevated—both a signal of consumer strain and a growing concern for traditional issuers.

Keeping Funds In-House

These factors have made real-time payments an attractive alternative for debt-laden consumers. BY enabling consumers to hold onto funds until the moment a payment is due, these systems provide a powerful cash flow management tool. That dynamic helps explain why the RTP Network has continued to expand even after the launch of the Federal Reserve’s FedNow instant payments service two years ago.

In fact, both networks continue to post new volume and value records. While much of that growth has been driven by commercial payments adoption—particularly after transaction limits were raised to $10 million last year—the same liquidity and timing benefits that appeal to businesses are increasingly resonating with consumers as well.

The post RTP Network Sets Records After Consumer Cash Flow Demand Rises appeared first on PaymentsJournal.

More states are cracking down on gift card scams. In 2025 alone, 22 states have introduced legislation targeting gift card fraud—up from just eight in 2024. While most proposals focus on enhancing criminal penalties, many also place new responsibilities on merchants that sell prepaid cards.

Over the past five years, six states have enacted merchant-specific requirements related to prepaid cards, according to a study from the National Conference of State Legislatures. Among retail-focused laws, the most common mandate is the posting of clear, visible notices warning consumers about potential gift card fraud. Two states—Maryland and New Jersey—have gone further, adding requirements around packaging, record-keeping, and employee training.

Fighting Gift Card Traffickers

More widespread, however, has been the push to increase penalties for fraud. Some 25 bills have been proposed in this category, with six states enacting new laws. Many impose harsher penalties on criminals considered traffickers of scam-related gift cards.

Texas, for example, now sets penalties based on the number of unactivated or counterfeit gift cards in an individual’s possession. Possessing fewer than five cards constitutes a state jail felony, while holding more than 50 counterfeit cards rises to a first-degree felony. Arkansas defines scams involving gift cards with an aggregate value under $1,000 as a Class A misdemeanor, while schemes exceeding $25,000 qualify as a Class B felony.

“Associating criminal offenses to the perpetrators of gift card theft and fraud is a positive move forward,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “It penalizes their acts without placing burdens on retailers, their associates, or the buyers. Regulations forcing better packaging and signage are generally a positive but can become burdensome or discourage sales if the language stated is not reflective of the actual problems.”

Concerns Over Cash-Out Laws

According to Hirschfield, the most consequential trend for the industry is the growing wave of cash-out laws, which allow consumers to redeem gift cards for cash when the remaining balance falls under a certain amount. At least 15 states have passed such measures, with California setting the highest threshold at $15.

“These regulations are promoted to help the consumer, but without the foresight into the negative consequences,” Hirschfield said. “While California’s $15 cash out law was promoted as a protection to allow consumers to not surrender unredeemed value, bad actors can easily take advantage of the higher limit to more easily convert gift cards into cash.”

Javelin is currently researching the impact of these cash out regulations as part of its annual prepaid consumer sentiment survey, which is scheduled for release this summer.

The post More States Are Tightening Their Gift Card Regulations appeared first on PaymentsJournal.

PhonePE and Google Pay hold dominant shares of India’s digital wallet market, where most transactions run on the Unified Payments Interface (UPI) real-time payments rail. While Apple Pay would enter an already crowded ecosystem, early signals suggest the tech giant’s wallet could have a larger impact than initially expected.

When Apple announced plans roughly a month ago to bring Apple Pay to India, the launch seemed mainly targeted toward iPhone users who are also Visa and Mastercard cardholders. This segment would be able to use Apply Pay for contactless retail payments.

Since then, Apple has reportedly entered discussions with three of India’s largest banks: ICICI Bank, HDFC Bank, and Axis Bank. This would expand Apple Pay’s reach to customers of those institutions in addition to existing card network users.

A key question, however, is UPI integration. Earlier indications suggested Apple Pay would launch without UPI support—a limitation that would constrain adoption in a market where UPI underpins the vast majority of digital transactions. Most recent reports, including one from Bloomberg, indicate that UPI integration is expected by the time Apple Pay launches in India, potentially mid-year. If realized, this would materially expand the wallet’s footprint.

Seeking New Markets

Apple Pay is the leading mobile wallet in the U.S., its home market, with over 90% of the market and roughly 65.6 billion users. This market dominance has been accomplished by the near ubiquity of the iPhone and Apple’s strong competitive moat.

That strong domestic position has prompted Apple to look abroad for incremental growth opportunities, including cross-border payments functionality in select markets.

India, the world’s most populous country, represents a powerful opportunity. iPhones now account for roughly 10% of India’s smartphone market, and Apple recently opened its sixth retail store in the country—a signal of its long-term commitment to the region.

Adding Biometric Authentication

Previous attempts to deepen Apple’s footprint in India were slowed by regulatory hurdles, like stricter requirements around biometric authentication. Apple’s early and consistent integration of facial and fingerprint recognition has helped normalize biometric verification globally. As biometrics have become more mainstream, their role in payments has expanded as well.

Historically, India required PINs or two-factor authentication to authorize digital transactions. Recent regulatory updates now allow for biometric authentication for UPI transactions within transaction limits—a shift that could lower friction for wallets capable of supporting it.

Still, competition is intense. Even Amazon Pay has struggled to gain traction in India’s digital wallet market. While Apple’s technology, ecosystem, and partnerships are clear advantages,  the company faces formidable incumbents and structural challenges as it seeks to establish Apple Pay in India.

The post Apple Pay Could Have a Bigger Footprint in India Than Expected appeared first on PaymentsJournal.

TikTok Shop has been at the forefront of the social commerce surge, where influencers’ live streams and product videos link directly to checkout. As a result, social platforms have become one of the fast-growing segments in e-commerce.

A key driver of this growth is frictionless payments. Platforms that let users buy directly see higher engagement and conversions, and a stablecoin could make transactions faster, cheaper, and more seamless—connecting social media with financial services in real time.

Recognizing this potential, Meta, which reaches roughly 3 billion users across Instagram, Facebook, and WhatsApp, is reviving its plans to introduce a stablecoin within its ecosystem. Such a launch could deepen the company’s role in social commerce while also positioning it as a major player in financial services.

“WhatsApp is essentially the communication layer for a large portion of cross-border payments, commerce, and even remittances—so stablecoins could become the settlement layer and significantly reduce fees for users,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “My guess would be that the UX mostly hides the crypto rails, so it’s all handled on the backend. The simpler the experience for the user, the better.”

“This will reduce payout delays, bank transfer and other intermediary frictions, and even FX complexities,” he said. “Meta will have the decision to pass savings to merchants, keep savings to add to margins and increase revenue, and/or potentially subsidize early on to drive adoption.”

Shifting the Strategy

All these benefits are reasons why Meta has long pursued a stablecoin. The tech giant first introduced its Libra stablecoin, later rebranded as Diem, in 2019. However, regulatory challenges and high costs forced Meta to shelve the project.

Following last year’s passage of the GENIUS Act, Meta revisited the idea, but with a new approach. Instead of issuing a proprietary stablecoin itself, the company released a request for proposals (RFP) to third-party firms, seeking a partner to handle stablecoin issuance and wallet operations.

“Meta is going to be one of many notable players entering the space,” Hugentobler said. “There’s no evidence that they are going to issue their own stablecoin this time, but it wouldn’t surprise me if they did at some point down the road. For now, I think their focus is distribution, wallet integration, and user experience—and they will let the regulated issuers focus on what they do best.”

Becoming the Default

One leading contender is Bridge, the stablecoin infrastructure firm recently acquired by Stripe. Bridge has quickly established itself as a major crypto player and even recently gained approval as a national trust bank.

Regardless of which partner wins the bid, Meta is targeting a launch later this year—a signal that digital payments are central to its social commerce strategy. its stablecoin by the latter part of the year. If successful, the move could strengthen the link between social media and fintech, bringing Meta closer to the super app model, and expand the mainstream adoption of digital assets.

“This is a big deal,” Hugentobler said. “With Meta making stablecoins a native payment inside these applications, the networks are big enough to push stablecoins and crypto rails for payments into the mainstream, and to become the default.”

The post Meta Seeks Third-Party Firm for Stablecoin and Wallet Ambitions appeared first on PaymentsJournal.

All indications are that 2026 credit card growth is upward, healthy, and under control, but watch out for rapid growth in unsecured installment loans. The good news is that these loans transfer high-risk credit card receivables to installment lenders. The bad news is that the growth is a subtle indicator of stress in household budgets.

Credit Bureaus Report High Growth

Credit reporting agency Equifax reported a 24.1% increase in unsecured consumer installment loans in December 2025, compared to the prior year, with 15 million loans totaling $ 62.6 billion. Seven million of those loans were classified as subprime. 

Credit card loan volumes are growing steadily, tipping the scales at $1.3 trillion in December 2025. Revolving volumes often show a bump in December because of holiday shopping. The longstanding trend is that card volumes increase with holiday spending, then when tax refunds hit in March and April, some debt gets extinguished.

But when card volumes head a steady course, and installment loans surge, an alarm bell should ring.

Ring, Ring, Ring

Consumers often use consolidation loans to pay down debt. Clever borrowers, or those with less debt, will use zero-interest credit card balance transfers. Here, they pay a 3% to 5% fee and enjoy an interest-free loan for a year. (See this report for a deep-dive on how Balance Transfers affect the card revenue model.)

Here’s the problem, though. Once the unsecured loan is approved, consumers can either keep a chunk for their household budgets and end up owing more than they started with. Or they can pay down their credit cards, keep their lines open, and juggle the new installment loan payment as they run up the card.

Neither a Borrower nor a Lender Be

Hey, I am cheap, and I save. I learned a long time ago that the dollars you bank, whether in a passbook account or a 401K, will serve you well in later years. Interest compounds, and a little pain now makes for a brighter future.

But most people don’t, and if you look at the Federal Reserve’s current numbers, we save only 3.6% of what we earn. That is much better than the historic low point of 1.4% clocked in July 2005, but much worse than the ’70s and ’80s, when the metric typically stood at 8% to 10%.

A Message to Credit Policy Managers

Credit card numbers are moving in the right direction, but be wary. When unsecured loans are booming, and when credit volumes are plodding along, keep a watchful eye on balance paydowns. When savings rates are lower, a subtle trend is brewing. Some people are juggling their credit obligations. Don’t be shy about collapsing some credit lines, as we suggest in this classic Javelin report.

The post Fast Installment Loans Growth: Card Managers Beware appeared first on PaymentsJournal.

Amid reports that Stripe is considering an acquisition of some or all of PayPal, a broader question emerges: Is the once-dominant payments giant worth more in pieces than as a unified company?

Competition has been steadily eroding PayPal’s position for years. Zelle has surpassed Venmo in payment volume, while tech giants such as Apple and Google have expanded aggressively into digital payments, encroaching on PayPal’s core territory.

The pressure has shown up in the numbers. PayPal’s stock has suffered steep declines over the past year, and the company recently parted ways with CEO Alex Chriss after issuing a profit outlook that fell well of Wall Street expectations.

A Tricky Package for Buyers

News of Stripe’s interest first, first reported by Bloomberg, suggested that the company may be targeting only select divisions of PayPal rather than pursuing a full acquisition.

“Stripe is one of a handful of large companies, including industry leaders Fiserv and JPMorgan, who are rumored to be interested in acquiring PayPal,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “But it’s hard to see how selling the company as-is to a single buyer would maximize shareholder value.”

“What’s interesting about the business that PayPal has built are the components: branded checkout, consumer wallet, Braintree merchant processing and Venmo,” he said. “From our view there isn’t a single buyer that would benefit acquiring all of those individual pieces, and it’s likely that anyone buying PayPal in whole would likely spin off or shutter one or two divisions that weren’t a fit for their business.”

No Consumer Experience

A full merger would combine Stripe’s modern payment infrastructure with PayPal’s vast consumer and merchant base. Braintree already competes with Stripe in merchant processing and could likely be integrated into Stripe’s platform. Stripe could also leverage the PayPal brand to strengthen its branded checkout offerings.

However, Stripe lacks a consumer-facing businesses, raising questions about how it would manage assets like Venmo and PayPal’s digital wallet. Stripe’s merchant-first reputation also prompts concerns about its readiness to handle consumer issues.

“Stripe built its brand on ease of integration for businesses,” Apgar said. “All of their service and support is AI-based. Any merchant who has had a service issue with Stripe will tell you it’s a nightmare. Stripe’s feeling is that it’s cheaper to handle the resulting attrition than hire staff to build out human-based service. If you imagine this same approach in consumer-facing businesses like PayPal wallet and Venmo, they will burn those businesses to the ground.”

The post What Stripe’s Reported Interest in PayPal Could Mean appeared first on PaymentsJournal.

New York is stepping up to protect consumers in the rapidly growing buy now, pay later market. The state has proposed new rules aimed at preventing surprising fees, ensuring clear loan terms, and giving borrowers the rights to dispute charges and get refunds that credit card users already enjoy—safeguards that were lost last year when the Consumer Financial Protection Bureau withdrew a similar rule.

For BNPL providers, the most significant change is that New York would become the first state to cap the fees that drive much of their revenue. In most cases, BNPL providers in New York would be limited to charging an $8 penalty fee. Governor Kathy Hochul’s proposed rules would target excessive convenience, late, and other penalty fees, reshaping the economics of these loans.

Impact on BNPL Providers

These regulations are not entirely unexpected. In 2024, the CFPB under President Biden issued an interpretive rule—later rescinded—that provided similar protections for BNPL borrowers, matching those already available to credit card users.

“BNPL vendors have largely been anticipating these types of regulations, which have been discussed for several years,” said Ben Danner, Senior Analyst of Debit at Javelin Strategy & Research. “The most damaging part for to BNPL vendors would be the fee limits, as fees are a significant revenue stream for lenders, particularly offering pay-in-four interest free loans. 

According to a 2025 study from the Richmond Fed, merchant fees account for most BNPL provider revenue, with late fees and penalties representing a secondary source.

Targeting Lending Practices

Predatory lending practices have become a target for Governor Hochul. In December, she signed the Fostering Affordability and Integrity through Reasonable Business Practices (FAIR) Act, which strengthened protections against junk fees and hard-to-cancel subscriptions. The BNPL regulations were mandated under a provision included in the state’s 2026 state budget.

Once the proposed rules are published in the State Register, a 60-day public comment period will begin, with the law scheduled to take effect 180 days after adoption.

The post New York’s BNPL Rules Would Limit Fees Providers Can Charge appeared first on PaymentsJournal.

As many banks have scaled back branch networks, automated teller machines have become essential pillars of the financial services infrastructure. But that autonomy has also made ATMs attractive targets for hacking, exploitation, and physical breach.

ATM “jackpotting” combines these tactics. Criminals gain access to a machine’s cabinet—often using widely available generic keys—then either inject malware into the existing system or swap the hard drive for an infected one. Once installed, the malware enables bad actors to force the machine to dispensing cash on command.

While the technique itself isn’t new, the Federal Bureau of Investigation recently warned that incidents are rising, citing more than 700 reported cases last year resulting in roughly $12 million in losses.

“The resurgence in ATM jackpotting in the U.S. just reiterates the adage: ‘Everything old is new again,’” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research. “ATM jackpotting became popular back in the early 2000s when IBM retired OS/2, the operating system used by ATMs worldwide.”

“With that operating system retirement, ATMs migrated to Windows,” she said. “That opened the floodgates for attackers, as vulnerabilities in Windows OS were easily exploited, either through an attack against the network or via a physical attack that involved locally installing malware via a thumb drive. Like any connected device running common software, ATMs must be regularly scanned and software-updated.”

On All Fronts

This fraud trend adds another layer of complexity for financial institutions already contending with relentless attacks. Many schemes focus on account takeover or social engineering, pressuring customers to sending payments or act as money mules.

Jackpotting highlights a parallel and troubling shift: criminals are using advanced technology to attack banks’ systems directly. Sophisticated malware, similar in capability to tools deployed in ransomware attacks, can disrupt operations at scale.

Recent incidents illustrate the stakes. An attack on payments provider BridgePay knocked systems offline and left customers without service for weeks.

Pervasive Threats

All these technology threats are supercharging the capabilities of already-impactful fraud groups.

“This latest report does not highlight what new techniques or tactics attackers are using in their latest ATM-jackpotting sprees, but I suspect the same techniques that proved fruitful more than 20 years ago are proving fruitful today—a socially engineered attack waged against an admin with rights and privileges allows access to the ATM or the physical ATM is compromised by criminals feigning to be employees or maintenance,” Goldberg said.

“Vigilance, as always, that is based on a model of zero-trust is the best way organizations can secure their networks and all of the devices—including ATMs—connected to them,” she said.

The post FBI Warns ATM Jackpotting Fraud Attempts Are Back on the Rise appeared first on PaymentsJournal.

Agentic artificial intelligence moved a step closer to real-world commerce last week when Mastercard demonstrated an AI agent in India that located a product and completed the purchase without the user opening an app or manually entering card details.

Presenting at the India AI Impact Summit 2026, Mastercard described the transaction as the country’s first fully authenticated agentic commerce payment. The demonstration offered a glimpse of a model in which software agents—using stored payment credentials—can execute purchases on a user’s behalf.

Security Is Paramount

The focus of the exercise was security. Built on Mastercard’s Agent Pay framework, the transaction took place within a controlled environment designed to verify both the user and the AI agent before payment authorization. The goal was to show that AI agent-driven commerce can meet the authentication and fraud prevention standards required for financial transactions.

The emphasis is likely to become even more important as agentic systems expand into B2B use cases, where transaction values are significantly higher and governance requirements more complex.

In comments to Business Today, Nitendra Rajput, Senior Vice President and Head of Mastercard AI Garage, said the company’s approach centers on secure automation and fraud prevention, with strict safeguards and user control built into the payment architecture.

Opportunities in the B2B Market

The broader commercial implications are even stronger. Data from Deloitte projects that  agentic AI could reach $17.5 trillion in gross merchandise value by 2030, with the majority—roughly $15 trillion—coming from B2B transactions and roughly purchases, and $2.5 trillion from B2C activity.

“Visa and Mastercard have both been very tech-forward by offering secure payment solutions to authenticate both the buyer and payment credentials in agentic commerce,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “These are important first steps to building the infrastructure that will make agentic commerce viable at scale for both merchants and consumers. While it’s fun to think of shopping bots keeping our pantries stocked, the more interesting application is enterprise B2B purchasing tasks, one of the categories that our research shows will among the first to leverage the power of agentic commerce.”

The post Mastercard Advances Agentic AI Commerce in India appeared first on PaymentsJournal.

In a rare victory against elder financial fraud, KeyBank has recovered $2 million stolen from some of its oldest customers—a reminder that swift action and oversight can make all the difference. According to the FBI’s Cleveland field office, every victim in the case got their money back.

The scheme exploited the most vulnerable: Yue Cao, a former quantitative analytics manager at KeyBank, fabricated online banking profiles for clients over 90 and funneled their savings into accounts he controlled. He deliberately targeted customers who had never used online banking, making the theft less likely to be noticed. In one shocking instance, he even opened an account for a man who had already passed away.

A Vulnerable Population

KeyBank’s internal fraud detection team flagged the unusual activity and quickly referred the case to the FBI before the victims were even aware. Earlier this month, a federal jury convicted Cao on ten counts of bank fraud, four counts of aggravated identity theft, and one count of money laundering.

Elder financial abuse remains widespread. The FBI’s Internet Crime Complaint Center reported a more than 40% increase in complaints from people over 60 in 2024. American adults in this age group lose an estimated $38.5 billion annually, with average losses reaching $83,000.

Guidance for Banks

KeyBank’s proactive approach demonstrates how vigilance and early intervention can protect vulnerable customers and recover stolen funds. It sets an example for other banks to educate and safeguard their clients before it’s too late.

“First and foremost, when working with scam victims, leading with empathy is the most important takeaway,” said Suzanne Sando, Lead Analyst of Fraud Management at Javelin Strategy & Research. “Banks need to treat the victim as just that—a victim—and not as a burden to the bank. Working with empathy and compassion helps to reduce the emotional toll victims face in the wake of a scam, which is often a leading reason why many scam victims don’t report their crimes.

“Banks should also manage expectations for the victim during the resolution process,” she added. “How long will it take? Who can they contact with questions or follow-up information? What’s next? Lay out the steps the bank is taking, the steps the victim may need to take, and expected timelines. Being transparent about the process eases stress and frustration in an already stressful situation.”

The post KeyBank Recovers $2 Million in Elder Fraud Scheme appeared first on PaymentsJournal.

Public transit systems are critical infrastructure that shuttle commuters and fuel tourism. However, purchasing tickets and reloadable passes is often a complex process that creates long queues and checkout friction.

That’s why more cities are moving to contactless payments, as San Francisco did last year with its Bay Area Rapid Transit (BART) system. Now, the Seattle and Puget Sound region’s transit system, ORCA, is launching contactless functionality that will allow riders to tap credit and debit cards, as well as leading mobile wallets like Apple Pay and Google Pay.

While this capability will likely be a boon for daily travelers, it can also dramatically reduce strain on the system during high-traffic events. For example, Seattle is expected to see a surge of visitors when it hosts six matches of the FIFA World Cup this summer. The city also has a packed calendar of concerts and festivals throughout the year.

Prepaid to Contactless

Delivering this functionality requires a substantial infrastructure investment, but the benefits of contactless payments outweigh the costs in this case. As a result, the ticketing and transit segment is one of the few markets shifting away from prepaid models after years of reliance on them.

Contactless payments accelerated during the pandemic due to hygiene concerns, and adoption has continued to grow because of their convenience. In addition, contactless payments offer flexibility that can drive revenue gains. For example, more riders may be enticed to use public transit when they don’t have to wait in long lines or decipher complex fare structures.

Taking the Pitch

This line of thinking was one reason the UK recently scrapped its transaction limits on contactless payments. Tap-to-pay has become one of the most popular payment methods in the region, and enabling more higher-value purchases can further support economic activity.

Despite the benefits of contactless payments, optionality is key. To that end, ORCA will continue to issue prepaid cards for riders enrolled in discounted or free-fare programs, such as seniors or those with organizational sponsorships.

This inclusive approach to payments can help ensure efficient travel for fans who want to be there when the USA takes the pitch against Australia this June.

The post Seattle Area Transit System Adds Contactless Payments Ahead of World Cup appeared first on PaymentsJournal.

While stablecoin usage in payments is expanding quickly, most current activity is still concentrated in internal use cases rather than external payments. Although total stablecoin transaction volume is estimated at roughly $35 trillion annually, the portion tied specifically to payments is closer to $390 billion.

That’s according to data from McKinsey, in collaboration with blockchain analytics provider Artemis Analytics, which found that the vast majority of that transfer volume reflects trading activity, internal treasury movements, and automated blockchain transactions rather than real-world payments.

“They’ve been an outstanding internal product because they let players like exchanges, custodians, market makers, and even protocols rebalance liquidity and settle transactions 24/7 and near instantly,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “No waiting for banks to reopen over night or during the weekend—they’re an ‘always on’ digital cash. This also reduces friction between parties, enables greater capital efficiency, and allows for programmable controls.”

External Use Cases

At the same time, stablecoin payment activity more than doubled between 2024 and 2025. B2B payments dominate the segment, totaling about $226 billion—roughly 60% of global stablecoin payment volume. The study found that B2B usage increased 733% year over year.

Consumer-to-consumer payments accounted for another $77 billion. Stablecoins enable peer-to-peer transfers that can settle almost instantly and often at lower cost than traditional methods.

A comparable amount, about $76 billion, was tied to consumer-to-business payments. Stablecoin-linked cards have played a significant role in this area, allowing consumers to spend stablecoins directly with merchants worldwide without first converting funds through exchanges or banks. Spending via stablecoin-linked cards reached $4.5 billion in 2025, up 673% from the prior year.

Global payroll and remittances conducted in stablecoins now total roughly $90 billion annually.

Further Incentives Needed

They key question is whether these predominantly internal uses will ultimately translate into broader adoption for external payments. For that shift to occur, digital assets will need to offer a more seamless user experience and stronger incentives for both merchants and end users.

“The cost savings and speed with faster settlement are clear advantages, but the incentives aren’t quite there for a multi-trillion-dollar payment landscape to fully make that jump,” said Hugentobler. “But we are seeing compliance efforts and partnerships with wallet and card providers, so things are coming down the pike pushing it in that direction.”

The post Stablecoins Expand in Payments, Yet Most Activity Remains Internal appeared first on PaymentsJournal.

Secure real-time payments are foundational to the open banking model, enabling users to pay directly from their bank accounts across a wide range of use cases. This capability is largely delivered through APIs provided by third-party fintechs.

This is the model that eBay plans to implement in the UK, where the e-commerce giant will tap into the substantial pay-by-bank network of TrueLayer to introduce account-to-account payments for its customers.

However, this partnership goes further than simply adding another payment option. eBay is also making a substantial investment in TrueLayer through its venture capital arm, signaling confidence in both the fintech itself and the broader open banking model. While this is a notable development, the long-term implications remain to be seen.

“This will be interesting to watch,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “It’s a stretch to say that the fact that eBay implemented pay-by-bank is now a broad validation for open banking platforms. What will amount to validation is how many eBay shoppers choose that payment method at checkout vs traditional card payments.”

“The proof will be in the figgy pudding—as they say across the pond—when we see the payment volume materialize,” he said.

Two Key Features

Many merchants have been drawn to real-time payments as a lower-cost alternative to credit cards and their associated interchange fees. That said, credit cards do offer certain benefits that help justify their costs.

“Card payments have evolved over their 50+ year lifespan, and the two-step process enables sellers to verify and claim good funds immediately at the time of purchase, while not actually charging the cardholder until the goods are shipped,” Apgar said. “This, combined with a well-defined chargeback and dispute process, highlights two key payment features that consumers forfeit when opting for pay by bank.”

A Challenging Road

These advantages, coupled with the dominance of card payments, suggest that real-time payments still face a challenging path to wider adoption in the UK.

“The lower fees and real-time settlement are certainly advantages for sellers, and we may see eBay and others offer incentives to consumers who select pay-by-bank,” Apgar said. “While there are many great use cases, it remains to be seen if buying goods from e-commerce marketplace sellers is one of them.”

The post eBay Adds Pay-by-Bank in the UK and Boosts Open Banking Investments appeared first on PaymentsJournal.

Merchants can dangle discounts or tack on surcharges, but it rarely changes how consumers pay. Consumers overwhelmingly stick with their preferred payment method, driven more by habit than by small financial incentives.

That’s one of the key findings in a new report from the Federal Reserve Bank of Atlanta, Merchant Steering of Consumer Payment Choice. Credit card surcharges are now legal in all but four states, and earlier studies have found that consumers strongly dislike them. But that hasn’t been enough to change their payment habits.

Discounts Have Little Effect

The Fed found that offering discounts for cash payments did not increase the likelihood that a customer who prefers to pay with a card would switch to cash. Cash discounts did not affect consumer behavior until transaction amounts exceeded $1,000. However, because most retailers offering cash discounts were restaurants, gas stations and convenience stores, transactions of that size were rare.

Consumers who favor credit cards are particularly consistent: nearly three-quarters of their transactions are made with a credit card. By contrast, just over half of the transactions by cash-oriented consumers are paid in cash. Debit users fall in between, using that method for 64.1% of their transactions.

“Merchants are shooting themselves in the foot trying to outsmart their customers,” said Don Apgar, Director of the Merchant Payments at Javelin Strategy. “Credit card users are going to use their card no matter what. These also tend to be the better customers who make larger purchases more frequently, so adding a fee to their credit card purchases just alienates their best customers.”

The Power of Inertia

The most effective way merchants can steer payment choices is by refusing to accept cards for purchases below a mount—or, in more extreme cases, by refusing card payments altogether. Anything short of that is unlikely to shift consumer aways from their preferred method.

Earlier Fed research found that most consumers prefer to use the same payment method for all or most of their transactions. The report cited several reasons for this inertia:

• Using a single payment method eliminates decision-making at the point of sale.
• It requires less forethought. For example, cash users can make a single ATM withdrawal to cover the day’s expenses.
• It simplifies record-keeping when all payments appear on a single statement.

These factors help explain why small financial incentives rarely alter how consumers pay, reinforcing that, at the point of sale, routine often trumps reason.

The post Surcharges and Discounts Can’t Overcome Payment Inertia appeared first on PaymentsJournal.

For years, compliance and security concerns kept many financial institutions on the sidelines of the digital asset market. Now, that hesitation is giving way to cautious optimism—and, increasingly, active participation.

That shift is due in part to the passage of the GENIUS Act in the U.S., which established clear ground rules for stablecoin issuers. Since then, leading digital assets firms like Circle, Ripple, and Paxos have received conditional approval from the U.S. Office of the Comptroller of the Currency to establish national trust banks.

These charters allow the companies to issue stablecoins, hold digital assets, and manage reserves—all under the purview of federal regulators. The latest company to receive this approval is stablecoin infrastructure provider Bridge, which was acquired by Stripe two years ago in what was one of the largest crypto-related acquisitions at the time.

Expanding Use Cases

Like Stripe, many of the world’s leading financial services firms have made significant investments in crypto ventures in recent years. Now, these companies are expanding their programs into new use cases. For example, YouTube recently added functionality enabling creators to receive payouts in PayPal’s PYUSD stablecoin.

While additional consumer-facing applications are on the horizon, including a Sony-backed stablecoin targeting the U.S. gaming market, the most dynamic use cases for digital assets may emerge in commercial payments.

The traditional B2B payments cycle has long revolved around extended settlement timelines designed for paper checks, making treasury management unnecessarily complex. Many of these processes remain manual and time-consuming, increasing the risks of errors and fraud.

Revitalizing the Landscape

These challenges are magnified in cross-border payments. International transactions often rely on chains of intermediary banks, resulting in delays, higher fees, and limited visibility into payment status.

By contrast, stablecoins have the potential to revitalize both domestic and cross-border commercial payments. Transactions can settle near-instantly on blockchain networks, with greater visibility for all parties and potentially reduced costs. In addition to operational efficiencies, organizations can optimize working capital by retaining cash longer and initiating payments at the last possible moment.

As more stablecoin companies, including Bridge, operate under U.S. regulatory oversight, businesses are likely to grow more confident in integrating digital assets into their operations. That momentum could further accelerate growth  the already red-hot stablecoin market, which now exceeds $310 billion.

The post Stripe’s Crypto Segment Bridge Gets Greenlit as National Trust Bank appeared first on PaymentsJournal.

A UK consortium has put plans for a payment rail to rival Mastercard and Visa on the front burner, with meetings among top British banking officials scheduled for this week. The aim is for the new system to be operational by 2030.

Visa and Mastercard currently handle roughly 95% of all card transactions in the UK. The new system, DeliveryCo, is intended to ensure the UK payments network can function even if the U.S. government interferes with their ability to process transactions overseas.

UK Finance, the industry trade body, is coordinating the initiative, with the planning group led by Barclays UK chief executive Vim Maru. Executives from Lloyds Banking Group, Nationwide, and NatWest are also involved. Mastercard and Visa are participating, taking stakes in the project.

A Switch in Attitude

Amid uncertainty surrounding NATO, the UK is concerned that its payments system could be at risk if U.S.-based rails like Visa and Mastercard become unavailable in the EU—or even if U.S.-based rails simply become less attractive to EU banks and consumers.

Historically, there hasn’t been a compelling case for creating new payment rails. EU regulations have kept interchange fees low, so merchants have not faced the same concerns over card acceptance costs as in the U.S.

“There has always been some concern that the only debit scheme in the UK is non-domestic, but the banks there have been happy not to have to pay to build and manage a domestic switch,” said Hugh Thomas, Lead Analyst of Commercial and Enterprise at Javelin Strategy & Research. “It’s only really now, with the U.S. schemes being seen as a potential vulnerability, that the conversation has taken this turn. My expectation is that this will spur a sustained effort to onshore UK debit switching in the long term.”

Prepare for the Worst

For now, UK banks appear focused on preparing for potential risks rather than pushing into the launch of a new UK-based rail, balancing caution with the understanding that the threat is not yet immediate.

“The incredible cost and difficulty in standing up such a scheme in a short period of time would require more than just the threat of losing access to Mastercard and Visa,” Thomas said. “It would need to be something close to a certainty.”

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Visa has been the sole card provider for the Olympic Games for roughly 40 years, but its dominant positioning has become a point of concern at this year’s Winter Olympics.

The main issue is that all official souvenir stores at the Milano Cortina games only accept Visa or cash. With cash usage declining across Europe, many visitors without Visa cards have faced long ATM queues to access funds.

While such logistical challenges are not unusual at major events, they highlight Europe’s resilience on foreign payment providers—a dependence that has disquieted many EU leaders. This has fueled increasing calls for a stronger, independent payments infrastructure to reinforce the EU’s standing as a global financial services hub.

“The Olympics has been Visa-only since that marketing deal started way back when, but now they’re shoved into the spotlight because of global affairs, so they are scrambling to install ATMs and let people use cash,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Banks in the EU issue Visa- and Mastercard-branded credit and debit cards just like they do in the U.S; Visa and Mastercard are global brands but are headquartered in the U.S.”

“With everything that’s been happening with NATO, Ukraine, Greenland, etc., now the EU is wondering if their payments system could be at risk if the U.S. does something that makes Visa and Mastercard unavailable to the EU, or at a minimum less desirable for EU banks and consumers,” he said.

A Digital Alternative

Although there is no indication that changes to card networks are imminent, financial services are increasingly a focus for EU lawmakers. The rapid rise of U.S.-dollar-backed stablecoins has also raised concerns about the euro’s role in global transactions.

The emergence of stablecoins has intensified discussions around a central bank digital currency (CBDC). However, progress toward a digital euro has been arduous, with ongoing debates about security and the necessity of the digital asset.

Despite these challenges, the European Central Bank plans to launch a digital euro by 2029, contingent on establishing an appropriate regulatory framework. If successful, the CBDC could debut just ahead of the 2030 Winter Olympics in France.

Protecting from the Splatter

The EU’s concerns extend beyond Olympic souvenir payments. Lawmakers recently met to discuss a comprehensive payments plan that would include a euro-backed stablecoin, tokenized deposits, and a focus on ensuring that all lending and aid efforts are denominated in euros.

These discussions followed a landmark trade deal with India that carried significant financial services implications. Collectively, these initiatives signal that payments stability is a top priority for EU leaders.

“There’s also nervousness in the EU about U.S. debt at $31 trillion and growing fast, based on tax cuts and spending in the U.S. right now,” Apgar said. “Many U.S. bondholders are EU countries who are unwinding their U.S. investment positions. Combined with tariffs, Iran, Venezuela, and Gaza, some EU economists are becoming bearish on the U.S., and if our economy hits the deck, the EU is trying to protect themselves from the splatter.”

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More than a decade after the Dodd-Frank Act redrew the regulatory boundaries of the banking industry, two Republican senators are seeking to revisit one if its key thresholds—a move that could steer millions in additional debit card revenue to community banks, credit unions, and their fintech partners.

According to Bloomberg, the legislation, introduced by Sens. Ted Cruz (R-Texas) and Katie Britt (R-Alabama), would allow more community banks to avoid the cap on debit interchange fees by indexing the current $10 billion asset threshold to inflation.

The proposal, titled the Community Bank Relief Act, would also benefit credit unions and fintechs that partner with qualifying banks.

The Durbin amendment to Dodd-Frank capped debit card interchange fees at 21 cents plus 0.05% of the transaction amount for banks with $10 billion or more in assets. When the law was enacted in 2010, roughly 80 banks exceeded that threshold, the senators note. Today, that number is closer to 130, including regional institutions such as Live Oak Bank in Wilmington, N.C., and Bancfirst in Oklahoma City.

Companion legislation is being introduced in the House by Representative Andy Barr (R-Kentucky).

Credit Unions, Fintechs See Benefits

The trade group America’s Credit Unions swiftly endorsed the proposal, saying the higher exemption threshold would benefit its members.

“As credit unions grow by serving more members and keeping pace with the economy, many are swept into limits that were intended for much larger institutions,” said America’s Credit Unions President/CEO Scott Simpson. “Indexing the threshold to inflation provides needed relief and restores fairness for community-based credit unions.”

Fintechs like Chime and Dave also stand to benefit from the new limit. These companies partner with smaller banks to access debit interchange revenue, which represents a key component of their business models. Expanding the pool of exempt banks would greatly increase their market.

An Outdated Limit

The legislation would apply the inflation adjustment retroactively to the law’s 2010 enactment. After several years of heightened inflation, that would push the new cap to more than $15 billion in assets.

“Interchange income is a big deal with any debit program, and the idea of the $10 billion asset cap was to provide retailers some relief on debit swipe fees while at the same time not disadvantaging smaller banks trying to compete with the big guys,’ said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “It’s been 15 years since Durbin was passed, and like anything else, $10 billion doesn’t buy what it used to. It makes sense that the cap should be tied to a formula that increments it over time.”

The post Who Wins If the Debit Fee Cap Limit Gets Raised? appeared first on PaymentsJournal.

Using debt to fund gambling activities is a highly risky proposition, even more so when transaction fees are involved. That’s why online betting giant FanDuel will no longer allow customers to fund accounts with credit cards.

The ban will apply to the company’s U.S. sportsbook, casino, and racing segments and follows mounting industry pressure and regulatory scrutiny. Senator Elizabeth Warren recently urged the company to halt credit card payments, noting that nearly a quarter of American bettors used credit cards to fund their accounts and that many incurred fees as high as half of the original wager.

Rival online betting platform DraftKings cited these fees as the main reason it stopped accepting credit card payments last year. Funding a gambling account with a credit card is often treated as a cash advance rather than a purchase, allowing interest charges and fees to accumulate quickly.

“This is actually a win-win for both FanDuel and consumers,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “For FanDuel, they get some modest per-transaction cost savings, which add up over time. And they can utilize the stored-value accounts to encourage responsible play, but also to incent and reward new deposits at rates less than the transaction and interchange fees.”

“For the players, they can continue to play and use readily available funds, meaning they will not be incurring credit card debt to fund their gambling activities,” he said.

Incentivizing Betting Behaviors

FanDuel’s stored-value accounts exemplify a model that has reshaped a prepaid industry once centered largely on gift cards. In effect, these accounts function like digital gift cards purchased for self-use. Such products have surged as more organizations recognize the pivotal role stored-value accounts can play in loyalty and rewards programs.

Amid the broader expansion of the prepaid market, digital gaming and gambling have emerged as standout segments. This growth is partly driven by platform incentivizes, including deposit matches and rewards tied to specific betting behaviors.

Gambling on Prepaid

Beyond loyalty optimization, there is a more practical factor behind the digital gaming and gambling market’s recent growth: legalization. Now that online betting is legal in 32 U.S. states, the pace of expansion may begin to moderate as the market matures.

Still, the elimination of credit card payments by the two leading U.S. online gambling platforms is likely to keep digital gaming and gambling among the top prepaid segments. While some gambling platforms still permit credit card deposits, that option may diminish. Eight of the 32 states have already banned credit card funding for betting platforms, and additional states could follow.

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The next phase of agentic commerce may not be about browsing or checkout, it may be about control of the wallet. Coinbase is introducing agentic wallets designed to function as full-service, autonomous money management tools, enabling AI agents to make payments, trade tokens, and earn yield on investments without constant human oversight.

The objective is to add financial functionalities to any AI agent through a plug-and-play wallet solution. One of the main benefits for users is that AI agents never sleep, allowing them to constantly search for opportunities and respond in real time.

“This is a big deal because it lets AI agents hold and spend money on-chain autonomously, and it even offers spending limits and features like risk screening,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “What this really will do is increase stablecoin activity dramatically and has the ability to automate DeFi activity and other on-chain transactions.”

“This will draw a lot of volume to Coinbase’s native chain Base as well,” he said. “On the flip side, if agents get compromised, mistakes and losses can add up quickly. So adoption of this tech will depend on of they have strong enough controls for developers and institutions.”

Minimal Human Intervention

Security and accuracy have been top of mind since the emergence of the nascent agentic commerce paradigm, as AI agents are designed to make decisions with minimal human intervention. As a result, there are many ways agentic AI could disrupt the current retail landscape—especially if these systems are exploited or misused.

For its part, Coinbase has implemented guardrails within its agentic wallets to ensure agents stay on task, including programmable spending limits and session-level controls. Users will also have access to a streamlined interface to monitor their agent’s status, fund wallets, and issue new prompts.

Building the Shared Language

Developing stable infrastructure to support AI agents has become a top priority for many of the world’s leading financial players in recent months. Google, Visa, and others have launched agentic commerce protocols designed to serve as a shared language among merchants, financial services providers, consumers, and AI agents.

Coinbase has also launched its x402 protocol, which leverages the previously unused HTTP “402 Payment Required” status code to facilitate instant stablecoin payments. The company’s agentic wallet launch is an offshoot of x402, which has reportedly gained significant traction. According to Coinbase, the protocol has facilitated 50 million transactions since its launch last year.

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Splitting a bill or chasing down a friend for concert tickets often takes more messages than the payment itself. Cash App is betting it can shrink that friction by turning everyday conversations into payment moments.

The company is allowing users to send payment links, which it hopes will provide a more informal way to request or receive money. The goal is to embed a hyperlink directly into a text message, email, or social media direct message, transforming an ongoing chat into a quick transaction.

Cash App says the feature grew out of Gen Z surveys showing that payments among friends often involve multiple back-and-forth conversations. The company is positioning the move as a way to ease the social friction around asking for money, allowing users to add tone and context within the conversation where it’s already happening.

Keeping Up with Zelle, Venmo

It’s also a competitive play. Zelle and Venmo already let users send profile-based links to request funds, and Venmo offers a widget that allows users to send payments without leaving the interface. Apple Cash, meanwhile, provides a fully embedded P2P experience within iMessage.

Cash App needs a distinct angle to compete with its better-known rivals. It has 57 million user accounts, compared with Zelle’s 151 million and Venmo’s 83 million. By making payments feel more casual and conversational, Cash App hopes to make the experience simpler for everyone.

“It will be a welcome addition to the user experience of paying and requesting money from others,” said Ben Danner, Senior Analyst for Debit at Javelin Strategy & Research. “Practically everyone—not just Gen Z—is texting these days, and it allows for streamlined communication before and after sending the payment link. I usually follow up friends after sending them money through a pay app—’Did you get my Venmo?’”

Expanding the Use Cases

P2P transfers have become an everyday staple. Cash App links are designed to streamline the process, letting users settle up without switching between apps.

However, both participants must have a Cash App account. If a recipient doesn’t, they’ll need to sign up before completing the transaction.

At the same time, Cash App recognizes that P2P transfers are expanding beyond friends and family. Research from eMarketer estimates that social commerce sales have reached $60 billion. Cash App is emphasizing that its new links also support business use cases, including recurring and group payments.

The post As the P2P Arms Race Accelerates, Cash App Adds Payment Links appeared first on PaymentsJournal.

Buy now, pay later loans have become a critical tool for consumers managing everyday expenses. However, persistent concerns remain about the transparency of installment loans and the potential for misuse.

To address these issues, the United Kingdom is instituting regulations that will place BNPL providers under the oversight of the Financial Conduct Authority (FCA). The new framework has four key components. First, customers must have full visibility into the terms of their BNPL agreements, including due dates, interest rates, and late fees.

Second, lenders will be required to conduct affordability checks to ensure borrowers aren’t overextending themselves and can reasonably meet repayment obligations. Third, if a customer experiences financial hardship, lenders must provide support and debt-assistance guidance. Finally, consumers will have the right to escalate complaints to the UK’s Financial Ombudsman Service.

The Preponderance of Debt

The goal of these measures is to foster an ecosystem in which BNPL providers can operate sustainably while customers are protected. One frequently voiced concern is that the rapid growth of installment lending is contributing to a preponderance of “phantom debt.”

Because many unregulated BNPL providers were not required to report lending data to credit bureaus, there has been limited visibility into whether cash-strapped consumers are accumulating unsustainable debt.

In response, some BNPL companies began voluntarily reporting to credit bureaus. Others, however, declined, arguing that the more fluid nature of BNPL loans would not be accurately captured on credit reports.

Not a Breed Apart

BNPL companies have also resisted comparisons to traditional credit products, positioning their services as alternatives to credit cards. Yet emerging data suggests  BNPL users are not a breed apart.

Data from LendingTree found that 41% of respondents reporting making a late BNPL payment last year, up from 34% the previous year. The survey also showed that more consumers are using BNPL for routine, everyday purchases.

These trends point to ongoing financial pressure among consumers. Due to these struggles, many credit card issuers have tightened underwriting standards and lowered credit limits. As more consumers turn to BNPL to bridge the gap, concerns about phantom debt—and calls for stricter regulation—are likely to mount.

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Jimmy Donaldson, also known as MrBeast, built his following by capturing the attention of young users on an exceptionally crowded platform. Now, the YouTuber with the world’s largest subscriber count is moving into fintech.

MrBeast is set to acquire Step, an app positioned as a one-stop shop for younger users. The platform offers tools for investing and financial management, along with spending and savings accounts linked to a Visa card.

A main goal of the app is to improve financial literacy for a new generation. Since launching in 2018, Step has attracted roughly seven million users and secured backing from Stripe and several venture capital firms. Even so, that user base represents just a fraction of MrBeast’s roughly 450 million YouTube subscribers.

Blurring the Lines

The move into fintech may raise concerns about the increasingly blurred lines between social media and financial services. Social platforms have often been a criticized as a breeding ground for financial misinformation, scams, and money mule recruitment.

Those concerns may be compounded by the fact that Step’s partner financial institution, Evolve Bank & Trust, has faced scrutiny and penalties related to its role in the collapse of fintech Synapse. Further uncertainty followed when the CEO hired to right the ship was fired last year.

From Partner to Competitor

MrBeast may remain somewhat insulated from these controversies, however, as Evolve primarily provides FDIC insurance and banking functions for Step. This arrangement—where fintechs manage the digital experience while regulated banks handle core financial services—is common and reflects the expanding open banking system at work.

At the same time, rapid technological change has pushed some fintechs from partners to competitors. Many leading platforms began as buy now, pay later or peer-to-peer payments services, then expanded into offerings that rival those of traditional banks.

While these platforms don’t always offer FDIC insurance, many younger consumers prioritize convenience and ease of use. This shift has made it more difficult for banks to build relationships in an increasingly crowded and fragmented landscape.

As banks, fintechs, and platforms compete for digitally native younger consumers, the influence of a trusted YouTube creator could prove meaningful.

The post YouTuber MrBeast Acquires Fintech Targeting Younger Consumers appeared first on PaymentsJournal.

A ransomware attack on U.S. payments platform provider BridgePay is having ripple across the country, leaving many entities—including restaurants and municipal organizations—unable to accept card payments.

BridgePay confirmed the attack last Friday, saying it had enlisted federal law enforcement as well as external forensic and recovery teams. According to a status update on the company’s website, the outage remains ongoing.

While the attack has rendered several core systems inoperable, the company said it has found no evidence of a payment card data compromise. BridgePay emphasized that any data accessed or stolen during the incident was encrypted.

Cash Only for the Time Being

Merchants that rely on BridgePay’s platform reported being forced to accept cash-only payments due to the card processing outage. Jimmy’s Roadhouse Bar & Grill in Michigan announced it could accept only cash on Super Bowl Sunday.

For municipal customers, the situation was more complex. The government of Palm Bay, Florida, reported that the city’s online billing payment portal was unavailable and didn’t have a timeframe for when the issue would be resolved. Residents were asked to make utility payments in person using cash, card, or check.

When Ransomware Fans Out

Ransomware attackers have increasingly targeted points of centralization in digital infrastructure, where an attack against a single provider can have cascading consequences for businesses nationwide—or even globally. An ransomware attack last year against Salesforce resulted in the theft of more than 1 billion customer records. More than 40 companies were affected, ranging from AirFrance to Walgreens. By accessing tokens and signing credentials, the criminals were able to move laterally and silently from one compromised vendor to another.

Another extortion campaign last year targeted Oracle’s E-Business Suite, giving criminals access to payroll, finance, and HR databases at numerous organizations. Nearly 30 major business were impacted, including Mazda and Estee Lauder.

Such incidents underscore the risks posed by centralized service providers and highlight the growing importance of cyber resiliency—the ability of organizations to withstand, adapt to, and recover from cyberattacks.

“Retailers and independent payments providers are at increasing risk because their cyber resiliency strategies have not evolved to address emerging risks,” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research. “Retailers and independent payments networks fail to address emerging cyber risks holistically. They need to bring in a proactive cyber resiliency mindset by investing more heavily in threat detection and prediction facilitated via cyberthreat and dark web intelligence.”

The post The Latest Wave of Ransomware Attacks: As Widespread as Possible appeared first on PaymentsJournal.

Small businesses power the U.S. economy, but for many, the access to reliable financing remains a persistent challenge.

To help close that gap, Visa has launched Visa & Main, a platform designed to centralize working capital and provide critical tools for smaller enterprises.

“Offering working capital and client acquisition tools are not new in the merchant space, acquirers and processors have been offering these tools for over 20 years,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “However, they are not available uniformly across the merchant market.”

“Some acquirers (like Square) have been very active in offering these tech and financing tools to merchants, while other acquirers don’t have them on their radar,” he said. “So, the play lines up with what Visa is doing. Rather than competing with our processor/acquirer customers, we will bring services to market that enable them.”

Walking a Fine Line

The growing small business market has become a central focus for many leading payments firms, fueling the launch of new point-of-sale systems, embedded finance platforms, and payments gateways.

“It’s an interesting move, although it tracks with their recent strategic moves in acquiring,” Apgar said “Within the last two years, Visa brought previous acquisitions Authorize.net and CyberSource together with VeriFi under the banner of Visa Acceptance Solutions (VAS). This strategy walks a very fine line between enabling your customers and competing with them.”

“Customers here are the banks and processors that deliver Visa services to merchants,” he said.  “Visa is no longer relying on their distribution through customers to bring technology to merchants, it advertises VAS directly to merchants and then works in conjunction with the merchant’s named acquirer to implement the tech.”

Controlling the Narrative

Visa also aims to entrench its solution by delivering a holistic platform for smaller merchants that helps level the playing field. For example, Visa & Main includes cloud-system capabilities and fraud detection tools.

“Both VAS and Visa & Main are designed to provide Visa with more control over the narrative that merchants hear,” Apgar said. “In other words, they are taking their tech story direct to market rather than relying on their acquirer/processor distribution channel to tell it. But at the same time positioning their efforts as helping their distribution partners, rather than competing with them.”

The post Visa & Main Brings Holistic Tools and Financing to Small Businesses appeared first on PaymentsJournal.

AI-generated deepfakes continue to pose a growing global threat, with investment opportunity scams emerging as the fastest-growing use case.

Between November 2025 and January 2026, the AI Incident Database documented more than a hundred separate deepfake incidents, many aimed at defrauding victims. Impersonation-for-profit is the “largest, most repetitive thread” in the latest reports. Researchers warn that these videos often feature familiar faces and trusted formats, creating credibility through seemingly official accounts.

Celebrity Sweepstakes

In many cases, politicians or celebrities appear to endorse a product or platform on social media. Victims are then funneled through a series of requests that ultimately ask them to transfer money. Some examples from the most recent incident report, all circulating on Meta, include:

• A Thai news anchor and the CEO of the Miss Universe Organization promoting an online investment promising rapid, high returns.
• Greek Finance Minister Kyriakos Pierrakakis depicted endorsing fraudulent “high-yield” investment schemes.
• Australian billionaire Andrew Forrest shown endorsing a fraudulent crypto platform called Quantum AI.

Slow Down, Take a Beat

The key to these scams is what the AI Incident Database calls “industrialized plausibility.” These videos combine low-cost realism with widespread distribution and weak verification methods. So how can social media users tell the difference between these deepfakes and reality?

“From a technical perspective, spotting deepfake red flags can be a bit tricky,” said Suzanne Sando, Lead Analyst of Fraud Management at Javelin Strategy & Research. “Pay attention to the edges and background of the focal point of the video. Look for blurring or warping in spots where it doesn’t look natural, and for mismatched or unaligned edges. Lighting and shadows are also a dead giveaway. If the lighting on the person doesn’t match up with the background or room. If there’s any audio component, listen for pacing and tone, and keep an ear out for any odd sounds or unnatural cuts or edits.

“If there’s even a hint of a doubt if something might be a deepfake or AI-generated, search on your own for verified sources for the offer,” she said. “In the instances of investment opportunity deepfakes, if it seems too good to be true, it probably is. Many scams rely on a sense of urgency to drive the victim to act immediately, but this is the time to slow down, take a beat, and do your research.”

The post Staying on Guard Against the Growing Use of Deepfakes appeared first on PaymentsJournal.

The euro is the world’s second-largest reserve currency, though it still lags far behind the U.S. dollar. Many European Union leaders believe that a stronger global role for the euro would enhance regional stability and create more opportunities for member states.

In upcoming talks, EU leaders have laid out an ambitious agenda to elevate the euro’s international standing. This includes issuing euro-backed digital assets such as stablecoins, tokenized deposits, and a central bank digital currency (CBDC). Another priority is to expand euro-denominated lending, including joint issuance by multiple countries, and to that aid and loans provided to other regions are denominated in euros.

Leaders are also exploring the creation of a regional payments network to rival the infrastructure established by Visa and Mastercard within the EU.

Reaching a Crescendo

Calls for more euro-backed digital assets have intensified in recent years, as stablecoins from Circle and Tether now move trillions of U.S. dollars globally. Stablecoins have proliferated across  banks, retailers, and social media companies, with use cases continuing to expand.

While euro-backed stablecoins exist, they account for only a small fraction of the market. This has fueled calls for a digital euro, though the CBDC faces pushback from banks and lawmakers. Banks worry it could compete with their products, while some policymakers question its privacy and financial stability implications.

A Global Financial Force                                              

Beyond digital assets, the EU is working to strengthen its real-time payments systems. Efforts include integrating domestic mobile payments platforms under a single umbrella and connecting to real-time payment networks abroad.

To this end, the EU recently unveiled plans to connect its instant payments infrastructure with India’s UPI system, unlocking a significant global payments corridor. India and the EU also signed a landmark Free Trade Agreement, aligning the two economies in multiple areas, especially financial services.

Ultimately, these efforts aim to position the EU as a stronger global financial force—a challenging task given the established global positioning of U.S. stablecoins, card networks, and cross-border payment rails.

The post EU Leaders Consider Comprehensive Payments Plan for the Euro appeared first on PaymentsJournal.

Despite recent contention over interest rates and transaction fees, credit cards remain firmly entrenched in the U.S. payments landscape. To capitalize on this ubiquity, Bank of America is undertaking a credit card revamp aimed at driving profits to new heights.

A central force behind this overhaul is artificial intelligence. The bank plans to leverage AI to identify and attract new customers, while also encouraging existing clients to deepen their relationship with Bank of America.

Another key aspect of the redesign is offering tailored incentives to customers with higher account balances, a strategy long favored by credit card issuers.

“Bank of America’s strategy to further their rewards program with incentives on customer deposits enhances their strategy to leverage the credit card as a comprehensive tool for customer management,” said Brian Riley, Director of Credit and Co-Head of Payments at Javelin Strategy & Research. “It expands a program they deployed for the past couple of years, and the timing is right.”

“Instead of simply associating rewards with card purchases, it considers deposit relationships and adds point accelerators,” he said. “This allows the issuer to add incremental value to consumer deposits and reward customers for their banking relationship. It is not new to Bank of America, and the functionality has been proven in the field.”

Squeezing More Value

Recent years of high inflation and interest rates have pushed consumers toward credit cards, driving balances upward and prompting issuers to tighten lending standards, lower credit limits, and prioritize stable customers.

“The timing is perfect from two perspectives,” Riley said. “First, it targets premium and luxury cardholders that pay large annual fees, such as Amex Platinum, Chase Sapphire, and Citi Strata. Secondly, with pressure on credit card rates looming, it is a way to squeeze more value out of the relationship for both the issuer and the cardholder.”

More Than Risk Mitigation

While interest rate pressures are not inevitable, many banks are preparing for a potential 10% cap on credit card rates. However, Bank of America’s strategy extends beyond risk mitigation The company has set an ambitious target: growing its customer base from 69 million to 75 million in four years.

One approach is using AI to gather deeper insights about prospective customers and deliver personalized offers at pivotal life moments, such as marriage or purchasing a home.

Ultimately, Bank of America aims to provide individualized underwriting for each customer. Once achieved, the bank has another ambitious goal: raising consumer unit profits to $20 billion—something that has only been accomplished twice in U.S. banking history.

The post Bank of America Overhauls Credit Card Program to Boost Customer Base appeared first on PaymentsJournal.

South Africa has entered the digital currency arena with the launch of a new stablecoin, ZAR Universal (ZARU), pegged to the rand rather than the U.S. dollar, which dominates the global stablecoin market. The initiative aims to make the rand “internet-native,” but history suggests its appeal beyond South Africa may be limited.

ZARU is a collaboration among several South African companies, including crypto investment firm Luno, asset manager Sanlam Specialised Asset Management, investment platform EasyEquities, and fintech Lesaka. The stablecoin is deployed on the Solana blockchain and is positioned as an alternative to dominant currencies such as the dollar and the euro in digital finance.

The stablecoin is backed by rand-denominated assets, including South African government bonds. By keeping the reserve assets within the domestic financial system, the consortium aims to drive demand for rand-based assets.

For the moment, ZARU is available only to institutional investors via the Luno and EasyEquities trading desks. Both platforms have indicated that access for retail investors is planned for a later stage.

Little Advantage Outside of South Africa

One clear advantage of ZARU is its potential to simplify cross-border transactions for South African businesses. Using a rand-pegged stablecoin could reduce reliance on the U.S. dollar for settlement, potentially lowering costs and shortening transaction times.

Beyond these domestic use cases, however, prospects for wider international adoption appear uncertain.

“Other than a policy angle of offering something other than the U.S. dollar, which follows the larger macro trend of de-dollarization and de globalization, I don’t see other people or countries using it all that much due to lack of liquidity and potentially higher volatility exposure,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “This will be mainly used for South Africa-based transactions like imports and exports, and remittances.”

Euro-Backed Stablecoins Struggle

According to a report from the Brookings Institute, approximately 99% of stablecoins in use are pegged to the U.S. dollar. Even euro-denominated stablecoins, backed by a far more widely used currency than the rand, have struggled to find a market.

French bank Société Générale, for example, spent two years trying to launch a euro-backed stablecoin. After achieving circulation of roughly $47 million, the bank announced last June it would instead pursue a stablecoin pegged to the U.S. dollar.

The post Rand vs. Dollar: South Africa’s Bet on a New Stablecoin appeared first on PaymentsJournal.

The rate of phishing attacks is accelerating, with spam filters flagging one email every 19 seconds last year, up from 42 seconds the previous year.

A major driver of this uptick is artificial intelligence, which has rapidly become a core component of fraud operations. In addition to speeding the deployment of phishing campaigns, AI is enabling cybercriminals to create highly adaptive messages to capture users’ attention.

AI can personalize logos, phrasing, signatures, and links for specific victims, and can even compose messages in multiple languages with grammatical accuracy. In a study by Cofense, over three-quarters of malicious URLs found in phishing emails were unique links.

Peppering the Message

Phishing attempts have mimicked major brands and entities since their inception, but the convergence of new technologies has made impersonation scams more effective than ever. Bad actors can now scrape data from the web and use it to pepper messages with personal details.

Much of this data is readily disclosed by consumers on social media. At the same time, social platforms themselves have become alternative channels that criminals can exploit to reach victims. For example, LinkedIn messages have become a common phishing avenue because many professionals access the platform on company devices, while many organizations have yet to implement stringent filtering for LinkedIn communications comparable to email security controls.

The Primary Vector

Although phishing has become the primary attack vector for cybercriminals, these messages are often just the first step. The Cofense report found a 204% year-over-year increase in phishing emails that delivered malware last year.

Malware like infostealers or remote access trojans (RATs) can have significant consequences. RATs allow bad actors to gain control of all or part of a user’s system, while infostealers can collect vast amounts of behavioral data that go well beyond login credentials.

AI can also play a role in malware management and data extraction once systems are compromised. However, current use cases may only be the tip of the iceberg. Credit bureau Experian recently identified AI agents as the top fraud threat this year, warning that agentic AI could soon autonomously handle many aspects of fraud operations.

The post AI Drives Sharp Rise in Phishing Volume appeared first on PaymentsJournal.

The store most known for home décor could soon offer tokenized home equity loans, after Bed, Bath & Beyond unveiled plans to acquire Tokens.com.

The big-box retailer has leaned heavily into the “beyond” portion of its name since emerging from bankruptcy two years ago. Its subsequent restructuring has included significant investments in blockchain and digital assets—for example when the company offered tokens representing shares of its Overstock and BuyBuy Baby brands’ profits and intellectual properties.

The acquisition of Tokens.com gives the retailer a direct pathway into the tokenization of real-world assets (RWA). In practice, this could allow consumers to bypass traditional bank application and tap directly into their home equity through Bed, Bath, & Beyond’s new platform, which could be operational as soon as July.

The broader goal is to build a unified ecosystem in which homeowners can both purchase goods and secure financing.

Seizing the Limelight

While the tokenization of cash—such as stablecoins and tokenized deposits—has attracted most of the limelight so far, RWA tokenization could prove just as impactful. This is partly because it can represent nearly any physical asset, from property deeds to artwork to stocks.

Once tokenized, these assets can be transferred across blockchains in a secure, transparent, near-real-time manner. They can also be easily fractionalized and sold to multiple buyers, with transactions that are typically faster and less costly than traditional alternatives.

These capabilities mean Bed, Bath, & Beyond customers could soon gain visibility into their home equity and the ability to convert it into cash or tradable digital tokens.

No Signs of Slowing Down

The disruptive potential of tokenization is why Robinhood CEO Vlad Tenev recently spotlighted the technology, going so far as to say that tokenization was an imminent “freight train” that would reshape the financial services industry.

“It’s not out of the ordinary to see huge compound annual growth rate (CAGR) numbers for early-stage companies or new technology like this,” Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research, told PaymentsJournal. “But depending on how you calculate it, tokenization’s projected CAGRs range anywhere from 400% to 4000%. It’s pretty impressive and there are no signs of slowing down. The number of companies that have launched funds on chain has seen like a 10X in just a couple of years.”

The post Bed, Bath, & Beyond Turns to Tokenization in Digital Assets Push appeared first on PaymentsJournal.

After Synergy abruptly shuttered its restaurant gift card program over the weekend, consumers were left holding stacks of apparently worthless prepaid cards. The company’s pending bankruptcy—after nearly 30 years of selling gift cards for locally owned restaurants—highlighted just how little recourse most consumers have when prepaid cards suddenly lose their value.

For many consumers, the end came swiftly. Synergy initially announced that its cards would expire on February 1, prompting a rush by consumers to spend any remaining balances. That surge in redemptions drained the program’s funds even faster than anticipated, forcing Synergy to shut it down a day earlier than planned.

Costco Steps Up

The cards were sold through Costco, which has stepped in to offer refunds to some customers. Costco is under no legal obligation to cover customers’ losses, and its website asserts that gift cards are nonrefundable. Nonetheless, the company has taken steps to provide limited relief to its customer base.

According to posters on Reddit, Costco is refunding the purchase price to customers who bought the cards themselves,or offering a Costco gift card if a third party had bought the Synergy card. While some customers said refunds were available only for cards that still retained their full original value, others reported that certain stores were granting refunds for partially used cards as well.

Unsecured Liabilities

The affected restaurants are also under no obligation to honor the cards. That leaves Synergy itself, which issued gift cards for local restaurants not only in its home base of San Diego, but also in Florida, New York, Texas, and several other states.

Synergy has no legal duty to reimburse its customers. Even if the company enters bankruptcy—an outcome expected any day—cardholders, though technically creditors, would be at the bottom of the priority list for repayment.

“In general, gift cards are unsecured liabilities, meaning they do not need any collateral or reserve requirements,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “They are simply a promise to pay. For most major brands this is not an issue, as they aren’t in danger of bankruptcy. But it shows why consumers need to understand the gift card they are buying and evaluate the worthiness of the represented brands to fulfil their obligations.”

For now, Synergy has now gone completely dark. Its website displays only a brief notice stating that the gift card program has been discontinued.

The post When a Prepaid Issuer Goes Belly-Up, Who’s on the Hook? appeared first on PaymentsJournal.

The Bank of England is pursuing a public consultation on consumer payments, focused on making it easier for shoppers to pay without using a debit or credit card. The process could pave the way for a UK-based instant payments system akin to Brazil’s Pix or India’s UPI.

The announcement came during a speech by Sarah Breeden, the BoE’s Deputy Governor for Financial Stability. She cited Pix and Sweden’s Swish as examples of national systems that have succeeded by offering seamless mobile payments. “We want UK consumers to have the option to pay retailers in-store or online directly out of their bank accounts as a complement to doing so via card schemes,” Breeden said.

Setting Up Competition

Debit and credit cards currently account for nearly two-thirds of transactions in the UK. One reason Breeden gave for launching the consultation was the hope that greater competition could lower transaction fees for smaller retailers, which in the UK can pay up to four times more than large chain stores to accept card payments.

“The payment scheme would enable direct payments for consumers at the storefront, bypassing the card networks entirely,” said Ben Danner, Senior Analyst of Debit at Javelin Strategy & Research. “The goal is to lower cost for retailers on payment processing by sidestepping the networks, and ideally those retailers would pass on the savings to consumers.”

Retail payment systems would need to support multiple forms of money. Breeden emphasized that stablecoins—jointly regulated by the Bank of England and Financial Conduct Authority—are likely to be used for real-world payments, not just crypto transactions.

Slow on the Uptake

Still, given the popularity of credit cards in the UK, an open banking scheme may take longer to gain traction than it did in Brazil or India. Both countries entered the transition with far less mature payments infrastructures than the UK has today.

“Like anything in payments, there is going to be a period of growing awareness, adoption, and then ubiquity as it co-exists among all the other ways to pay,” said Danner. “As digital payments continue to grow, retailers will welcome the lower processing costs.

“However, I don’t expect some kind of mass exodus from traditional card products. Customers will need an incentive to switch to this system. Merchants can offer incentives to use the lower cost account-to-account method, such as a discount.”

The post Why the UK Is Exploring Instant Payments appeared first on PaymentsJournal.

While some may associate Alipay with China’s tremendously popular super app, its sister platform, Alipay+, is a merchant gateway with a rapidly expanding international reach.

As one of Ant International’s merchant platforms, Alipay+ played a crucial role in facilitating more than two billion cross-border payments last year, many of them originating in fast-growing markets like Southeast Asia, South Asia, the Middle East, and Latin America.

Altogether, Alipay+ connects to over 150 million merchants across more than 100 markets. That scale makes it is a significant development that India is considering linking its Unified Payments Interface (UPI) to the network. As the predominant real-time payments system in the world, UPI handles nearly half of global digital transactions.

Building on Dominance

Integrating with Alipay+ would make it easier for UPI’s roughly 400 million users to access instant payments while traveling abroad. This could significantly reduce the costs and settlement frictions that are commonplace in cross-border payments, while also helping keep users within the UPI ecosystem.

As UPI has become the most dominant real-time payments platform in the region, the Reserve Bank of India has aggressively looked for ways to expand the system. These efforts include raising transaction limits to enable higher-value purchases and linking the system to a credit card facilitated by Google Pay.

The Inevitable Expansion

Amid this growth, expansion beyond India’s borders seemed inevitable. Last year, UPI teamed with PayPal World, the fintech’s cross-border payments platform, in a deal that also included Alipay rival WeChat Pay.

However, one of the most intriguing developments for UPI has blossomed from the deepening relationship between India and the European Union. After a successful pilot, the European Central Bank announced plans to move forward with connecting its TARGET Instant Payment Settlement (TIPS) service to UPI.

Even more impactful is the newly established Free Trade Agreement between the EU and India. A central pillar of this landmark agreement is the creation of interoperability between the payments infrastructures of the two economies.

Taken together, these initiatives have transformed UPI from a purely domestic digital payments system into a significant cross-border payments player, with the potential to reshape what has long been a complex and inefficient process.

The post India Considers Integrating UPI with Alipay+ for Cross-Border Payments appeared first on PaymentsJournal.

The long-rumored BRICS payment system may finally be moving toward reality. A payment rail built on interoperable central bank digital currencies (CBDCs) has appeared on the agenda for the group’s summit to be held in India this summer, more than a decade after the idea was first floated.

Attention has shifted away from a proposed BRICS currency, to be called the Unit, which was bruited about last year. Logistical challenges and concerns that China’s yuan would dominate any shared currency have sidelined that concept for now, in favor of developing alternative payment rail to rival the Europe-based Swift network.

The approach under discussion would revive the BRICS Cross-Border Payments Initiative (BCBPI) concept, first proposed in 2015. Rather than creating a new currency, the system would link existing national CBDCs such as India’s digital rupee, China’s digital yuan, and Russia’s digital ruble. Russia has been banned from using Swift since launching its war on Ukraine in 2022.

Seeking Technical Solutions

As a founding member of BRICS and host of the upcoming summit, India is playing a central role in shaping the initiative’s direction. Home to the successful payment system Unified Payments Interface (UPI), India has consistently favored interoperable payment rails over currency integration.

The latest proposal relies on two technical mechanisms to simplify cross-border settlement: settlement cycles and foreign-exchange swap lines. Settlement cycles would allow countries to net trade flows over time rather than setline each transaction instantly, transferring only the final balance. Forex swap lines would enable central banks to temporarily exchange currencies if a country needs additional liquidity in a specific currency to settle its obligations.

A Mishmosh of Economies

The BRICS group—originally Brazil, Russia, India, China, and South Africa—now also includes Egypt, the United Arab Emirates, Indonesia, and others. Collectively, its members account for roughly 45% of the world’s population and about 35% of global GDP.

One of the system’s key challenges, however, is the limited economic commonality among its members.

“There isn’t really all that much trade between this group of countries,” said Hugh Thomas, Lead Analyst, Commercial & Enterprise at Javelin Strategy & Research. “My expectation is that they will continue to build spot solutions where they can find common cause on use cases and a willing audience, but business’s need for transparent systems in countries with independent regulators and a clear rule of law will keep most big flows on Swift.”

The post BRICS Puts Its Payment Rail on the Front Burner appeared first on PaymentsJournal.

As one of the three major credit bureaus in the United States, Equifax has broad visibility into consumer credit behavior. In recent years, one notable trend has been the rise of first-party fraud, in which consumers knowingly exploit organizational policies for financial gain.

First-party fraud, sometimes referred to as consumer-engaged fraud or friendly fraud, can take many forms. One commonly cited example involves shoppers who purchase items online with the intent to return them and pocket the refund.

Equifax is leveraging its access to credit data to address two other prevalent forms of first-party fraud: loan stacking and credit washing. Loan stacking occurs when consumers rapidly apply for multiple loans with no intention of repayment, while credit washing involves attempts to remove negative information from a credit report.

To detect these patterns, Equifax is deploying its Credit Abuse Risk predictive model. The model’s primary objective is to identify suspicious application behavior in real-time, enabling lenders to be notified immediately and respond accordingly.

Justifiable Fraud

Stronger defenses are increasingly necessary, as first-party fraud has become the most common form of fraud. One reason for its growth is that many customers don’t view it as genuine fraud. Data from FICO found that nearly a third of respondents believe lying on credit applications is either justifiable under certain circumstances or simply common practice.

This mindset has been shaped by several factors, including digital anonymity and mounting economic pressure. In recent years, high inflation and elevated interest rates have ramped up financial stress, while credit card debt has prompted lenders to tighten underwriting standards.

As a result, some consumers feel validated in gaming their credit profiles or inflating details on loan applications.

When the Criminal Is a Customer

The proliferation of first-party fraud has created a new paradigm for the financial services industry, as threats increasingly originate from within the customer base rather than from external attackers. When the criminal is a customer, many organizations lack the tools and processes needed to identify and mitigate the threat.

Further muddying the waters is the emerging era of agentic commerce. As AI agents increasingly make purchases on behalf of consumers, organizations will face a host of new questions around responsibility in returns, accountability, and liability in cases of fraud—whether first-party or otherwise.

The post Equifax Launches Credit Abuse Risk Model to Detect First-Party Fraud appeared first on PaymentsJournal.

After decades of discussions, India and the European Union have agreed to a landmark deal aimed at eliminating tariffs and taxes, integrating supply chains, and strengthening manufacturing capabilities across both regions.

Financial services is a key pillar of the Free Trade Agreement (FTA). As part of the deal, the two economies are working toward payments interoperability, including real-time, cross-border payments and remittances.

The overarching goal is to build a stable, long-term economic integration that benefits both sides. According to the Associated Press, trade between India and EU was relatively flat from 2024 to 2025, hovering around $136.5 billion. After the FTA, the two regions hope to boost trade to approximately $200 billion by 2030.

Calling for Stronger Infrastructure

Beyond the immediate opportunities for payments providers in both markets, the agreement allows each region to leverage the other’s strengths—most notably India’s leadership in real-time payments through its Unified Payments Interface (UPI).

The FTA builds on a prior agreement by the European Central Bank (ECB) to link its TARGET Instant Payment Settlement service with UPI. The newly inked deal also calls for broader collaboration on fintech initiatives, spanning compliance, artificial intelligence, and potentially even central bank digital currencies (CBDCs).

The digital euro has been debated for years, as EU member states weigh efficiency gains against potential privacy concerns. Recently, however, momentum has shifted, with the digital euro increasingly positioned as a cornerstone of EU payments autonomy.

ECB Executive Board Member Piero Cipollone has emphasized the need for a payments infrastructure built entirely on European technology. These calls have intensified amid the surging popularity of U.S. dollar-backed stablecoins and the expanding reach of Visa and Mastercard’s cross-border payments networks.

Responding to Entrenchment

Against this backdrop—alongside the continued entrenchment of U.S. technology and currency, and a more assertive U.S. trade stance in recent months—the FTA represents both a strategic response and opportunity. The agreement could have significant economic implications for nearly two billion people.

According to Indian Prime Minister Narendra Modi, trade between the two economies already accounts for roughly a quarter of the global gross domestic product and around a third of global trade.

The post Linking Payments Infrastructure Is a Key Component of India, EU Deal appeared first on PaymentsJournal.

Amazon is closing all 72 of its Amazon Go and Amazon Fresh locations, shifting its focus to Whole Foods locations and grocery delivery from Amazon.com. But the company isn’t ready to walk away from the much-ballyhooed Just Walk Out technology that powered many of its retail experiments. Instead, Amazon plans to double down on marketing that technology as a service to third parties.

At its peak, 27 of the 44 Amazon Fresh stores used Just Walk Out, which allowed shoppers to grab items and leave without stopping at checkout. Amazon removed the system from all U.S. Amazon Fresh stores in 2024—not because it failed, but because customers showed a preference for more traditional checkout options.  

“Amazon’s innovative unattended retail experiments are failures in the same sense that early versions of lightbulbs, automobiles, and other great technical innovations were failures,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “These aren’t technical failures in the sense that they didn’t work at all, but rather commercial failures because they weren’t able to be produced and distributed efficiently at scale sufficient to make them a profitable venture for the company.”

Moving to B2B

Amazon hasn’t given up on Just Walk Out. The company is reaffirming its commitment to a B2B strategy, positioning the system for use by third-party operators such as sports venues and hospitals.

“Our Amazon Go locations served as innovation hubs where we developed Just Walk Out technology—now a scalable checkout-free solution operating in over 360 third-party locations across five countries,” Amazon noted on its blog. “The customer impact has been transformative, from reducing cafeteria wait times from 25 to just 3 minutes at BayCare’s St. Joseph’s Hospital, to enabling sports fans at Scotiabank Arena to grab concessions in 30 seconds.”

Apgar noted: “I don’t think this is the end of unattended retail, but rather a crucial step in the evolution of a commercially successful model.”

Goodbye to Amazon One

Not all of Amazon’s retail technology is getting a second life. The company is fully retiring its Amazon One palm recognition ID system on June 3, and says all user data will be automatically deleted.

The technology was installed in Whole Foods stores as recently as 2023 and was even piloted in healthcare settings in 2025. Ultimately, however, customers proved reluctant to move away from fingerprint- and face-based authentication.

The post After Retail Closures, Amazon Pivots on Just Walk Out Technology appeared first on PaymentsJournal.

As the leading U.S. peer-to-peer payments service, Zelle has become a staple offering for most financial institutions. Even so, the network found room to expand last year, onboarding 337 new institutions.

Nearly all of these new partners were community banks or credit unions managing less than $10 billion in assets. Collectively, these institutions serve a broad mix of customers, including farmers, small businesses, and underserved communities.

Alongside this expansion, Zelle also highlighted the growing range of use cases on its platform. Although the network was originally designed for P2P payments, consumers are increasingly using Zelle for everyday transactions, including recurring expenses like rent and utility payments.

Embedding the Platform

Since its launch in 2017, Zelle has continued to grow by leaps and bounds, driven in large part by its formidable backing. The organization is owned by Early Warning Services, a consortium of seven of the largest U.S. financial institutions, including JPMorgan Chase, Bank of America, and Wells Fargo.

Zelle was initially launched in response to the surging popularity of P2P apps like Venmo, PayPal, and Cash App. However, the network diverged from that model by jettisoning its app and instead embedding its service directly into financial institutions’ mobile and online banking platforms.

A Successful Model

That approach has proven successful. Through the first half of last year, , U.S. consumers and small businesses completed roughly two billion transactions on Zelle—representing a 19% year-over-year increase. Total transaction value rose by nearly 25%, reaching almost $600 billion. Small business payments were the platform’s fastest-growing segment, increasing by nearly a third year-over-year.

Despite this momentum, Zelle has faced notable challenges in recent years. One of the platform’s biggest benefits—near-real-time settlement—can also be a liability. Once a payment is sent, it is often irrevocable, leaving limited recourse for users who are defrauded into authorizing transactions.

As scams have become more widespread, Zelle has drawn scrutiny from the U.S. Consumer Financial Protection Bureau, as well as a lawsuit from New York State over fraud protections on the platform. The lawsuit alleged that Early Warning Services was aware of the network’s vulnerabilities but failed to adequately address them.

In response, Zelle has maintained that because users were tricked into sending money, there was no inherent flaw in the system itself. However, JPMorgan Chase recently updated Zelle’s terms of service to grant the institution greater authority to delay or cancel payments—especially those originating from social media—largely in response to mounting fraud concerns.

The post Zelle Expands to Include Community Banks and New Use Cases appeared first on PaymentsJournal.

Buy now, pay later pioneer Affirm has become the latest fintech to apply for a U.S. banking charter. Filed in Nevada, the application is the most recent wave of filings prompted by a more favorable regulatory environment at both the state and federal levels.

Affirm was the second high-profile fintech to announce a state charter this month, following Checkout.com’s approval of its Georgia charter. They join fintech giants like PayPal, Ripple, and Circle, all of which have sought bank charters over the past year.

An Upturn in Applications

The surge is partly driven by the Trump administration’s relaxed regulatory stance, which has created a welcoming climate for fintechs pursuing banking charters. In a speech last month, Comptroller Jonathan Gould noted that the Office of the Comptroller of the Currency received 14 de novo charter applications in 2025—compared with an annual average of fewer than four from 2011 through 2024.

This regulatory approach has also influenced state-level frameworks. Because obtaining banking approval from the OCC can be challenging, several states have developed fintech-friendly banking structures designed to attract new entrants.

“Two types of banking models are those governed by national charters, which fall under the OCC’s purview, and those under the scrutiny of state banking authorities,” said Brian Riley, Co-Head of Payments at Javelin Strategy & Research. “Both charters may be insured by the FDIC. State chartered banks typically attract fintechs, non-traditional banks, and bank-as-a-service models. States like Nevada, Texas, and Utah tend to be more friendly to alternative models, and have high rate caps that fintechs can export to other states, thanks to the Marquette decision.”

New Access to Products

The 2020 Marquette decision, a Supreme Court ruling, allowed states to let banks export their state-authorized rates to borrowers in other states. This sparked a competition among states to offer incentives to financial entities while still permitting nationwide operations.

Beyond fostering a more favorable lending environment, state charters enhance a fintech’s credibility and simplify compliance with a patchwork of state laws. Affirm said the charter would help it expand access to unspecified “honest financial products.” The application closely followed a newly announced collaboration with Fiserv, aimed at expanding banks’ access to Affirm’s BNPL programs for debit card holders.

The post Affirm Joins the Parade of Fintechs Seeking Bank Charters appeared first on PaymentsJournal.

In the 17 years since the first bitcoin was mined, cryptocurrencies have been labeled everything from a passing fad to the next big thing. In recent years, latter view has gained traction, driven largely by the rise of stablecoins and increased institutional investment.

And yet, widespread crypto payments at retail points of sale have remained elusive. That may be starting to change, according to research by PayPal and the National Cryptocurrency Association. The study found that around 39% of merchants already accept crypto, including roughly half of businesses generating more than $500 million in annual revenue.

“Merchants, especially the large enterprise retail brands, are always looking for ways to improve their customer experience and drive incremental sales, and customer payments are an important part of that process,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Crypto continues to become more popular with consumers, and in turn that will continue to drive its popularity with merchants.”

Attracting Sought-After Customers

Customer interest has played a key role in this growing acceptance. Most merchants surveyed said inquiries about crypto payments were common, and those questions often came from highly sought-after younger customers in the millennial and Gen Z demographics.

Beyond attracting and engaging younger customers, merchants cited transaction speed and security as key benefits of crypto payments, which typically settle in near real-time on transparent blockchain networks. These advantages extend to cross-border payments as well, potentially opening up meaningful new markets for merchants.

Given these benefits, roughly 84% of respondents believe crypto payments will become common in the next five years.

Doing the Heavy Lifting

One reason crypto payments haven’t seen broader adoption to date is concern over the volatility of many digital assets. However, as major payments players have built out crypto infrastructure in recent years, they have increasingly removed conversion and volatility management from merchants’ responsibilities.

For example, Visa recently launched a stablecoin acceptance platform that allows merchants to accept cross-border stablecoin payments without handling tokens directly. PayPal has also launched a crypto platform that does the heavy lifting for merchants, allowing them to accept payments in over 100 cryptocurrencies from leading wallets like Coinbase Wallet, MetaMask, and Kraken.

With strong demand from consumers and growing enablement on the merchant side, mainstream adoption of digital asset payments at retail appears closer than ever.

The post Customer Interest and Efficiency Attract More Merchants to Crypto appeared first on PaymentsJournal.

More than half of buy now, pay later users have missed a payment at some point—but the surprising twist? It’s often the high-income borrowers who are the biggest offenders.

An increasing number of BNPL users treating their loans like credit card bills, weighing the convenience against the risk of a late fee. According to data from Lending Tree, in the past year, 41% of respondents reported a late payment, up from 34% the previous year. Nearly a quarter of BNPL users have had three or more active BNPL loans at once—and again, high-income borrowers top the list.

The Same Playbook as Credit Cards

BNPL providers often tolerate late payments, as the fees can be profitable. But for users, this convenience comes with hidden risks.

“Nearly half of credit card users are revolving debt, meaning they couldn’t pay the full debt on time,” said Ben Danner, Senior Analyst, Credit and Commercial at Javelin Strategy & Research. “A growing number of late fees indicates financial strain as households prioritize other areas of debt over BNPL loans. Any kind of late payment or failure to pay could cancel out any type of increase gained from taking out a loan with a vendor.”

“Late fees are a significant revenue driver for BNPL vendors,” he said. “As long as that money is eventually paid, it is not necessarily a bad indicator for the vendor. Many vendors are using proprietary underwriting standards, which may need to tighten. However, this goes against their marketing model, which suggests easy access to split payments.”

Confusion Over Credit Scores

Many users misunderstand how BNPL loans affect their credit score. Lending Tree found that more than 60% of users incorrectly believe that making on-time payments improves their credit. In reality, BNPL loans don’t always report to credit bureaus, meaning timely payments may not boost a credit score at all. For borrower, this creates a false sense of security and can contribute to larger financial strain over time.

“The CFPB calculated that late fees were around $10 on an average BNPL loan, not a disaster to the consumer budget,” said Danner. “But over time, they add up, and considering the potential hit to credit scores, the impact is alarming.”

The post Late BNPL Payments: A Problem for Borrowers, Not Lenders appeared first on PaymentsJournal.

Late yesterday Capital One announced that it had acquired the commercial payments and expense management fintech Brex for $5.15 billion, half in cash and half in stock. Analysts have been noting that the price is a sharp discount from Brex’s peak valuation of roughly $12 billion, suggesting this may be reflect the broader reset in fintech valuations since 2021, but also Brex’s recent slower growth.

For some historical perspective, Capital One has made tremendous strides since launching its commercial card business in the 2000s, chiefly by leveraging its risk management and data wrangling abilities to replicate large market program economics for a portfolio understood to be mostly mid-market customers.

Launched in 2018, Brex’s commercial card portfolio seems to have scaled as fast or faster than Capital One’s, relying in large part on the same tactic of taking enterprise program offers downmarket, but with a lure of enterprise-grade expense management and controls, as well as a digital first approach. This acquisition, along with the acquisition of the Discover network, presents tremendous opportunities for Capital One in the commercial payments space.

The World’s Your Oyster, If You’ll Have It

With the Brex acquisition, Capital One seems to have all the ingredients for a scaled working-capital machine: a longstanding institutional focus on industry leading underwriting, a network where they can shape both authorization and settlement economics, and now a platform with state-of-the-art spend controls and workflows, built to draw in customers focused on leading edge tech. The three parts, properly integrated, offer the potential for a uniquely differentiated platform for commercial cards and broader commercial payments.

One hopes that Capital One sees the potential synergies in these two acquisitions, because they will need to be clear-eyed about the integration lift required to capture it. Taking on Brex while still onboarding Discover raises the risk of slower decisions, duplicated work, and blurred ownership. The ingredients are there, but realizing the full working-capital machine will take substantial execution.

Discover has historically been oriented toward retail, suggesting less expertise in commercial working-capital product development, specifically the expertise required shape a strategy to leverage its retail focused network and sales arm into something fit-to-purpose for conversations with B2B payees.

Now for the Assembly

Brex’s success is largely a product of its fintech talent and operating pace. Acquisitions often see key individuals cash out, and while the principals at Brex have committed to stay, the risk is always that talented team members accustomed to fintech environments may be less inclined to want to work for a bank. A potential mitigating factor is that Capital One is not a conventional bank: it has a long track record of behaving like a disruptor, with a product and data-led operating model and a talent base that often seems equal parts fintech and banking.

So Brex brings state-of-the-art platforms and a substantial installed base, Discover brings the opportunity to manage network pricing across buyers and sellers, and Capital One brings leading underwriting expertise and scale. A powerful combination of factors to be sure, but as with most acquisitions like these, success will be determined less by the pieces than by how quickly and cleanly they are assembled.

The post Capital One’s Brex Bargain: Now Comes the Hard Part appeared first on PaymentsJournal.

In just over two years since its launch, the U.S. Federal Reserve’s FedNow real-time payments system has attracted participation from 1,600 financial institutions.

The service added 500 institutions over the course of last year alone, with more than 100 joining in Q4 2025. Currently, nearly all of the nation’s leading financial services companies now participate in FedNow.

This expanding footprint has driven measurable improvements across nearly every key metric for FedNow. The Federal Reserve reported that average daily transactions on the service reached almost 30,000 last year, while total transaction volume increased 460% year-over-year.

Alongside this volume growth, the total dollar value of FedNow transactions reached $853.4 billion last year, with an average payment size of $101,435—up significantly from $38.2 billion and $25,376, respectively, the prior year.

The Obligatory Comparison

As successful as FedNow has been, nearly every discussion of the network includes comparisons to the Clearing House’s RTP network. That’s because the two are the only players in the closely watched U.S. real-time payments space.

Although it was established in 2017 by a consortium of the largest U.S. banks, the RTP network has already been surpassed by FedNow in one key area: network participation. RTP currently has around 1,135 financial institutions on its network.

However, the RTP network still exceeds FedNow in payments value. The Clearing House recently reported processing more than $1.3 trillion in total payments in 2025. This may be partly due to RTP increasing its transaction cap from $1 million to $10 million last February, while FedNow did not raise its limits until September.

A Testament to Real-Time Payments

While comparisons between RTP and FedNow are inevitable, there is substantial overlap between the two services. For example, PNC Bank—a founding member of the Clearing House—was one of the last holdouts to finally join FedNow.

PNC emphasized, however, that its support for FedNow should not be interpreted as a lack of confidence in the RTP network. Rather, the growing participation in both networks by hundreds of banks and credit unions is a testament to the power of real-time payments and their potential to reshape the U.S. payments landscape.

The post With More Institutions on Board, FedNow Notches Volume and Value Gains appeared first on PaymentsJournal.

The over two billion consumers within Tencent and Alibaba’s ecosystems use these platforms to send messages, shop, and pay in a unified super app. Now, many of these users will be able to leverage the platforms’ AI agents for full-fledged agentic commerce.

For example, Alibaba has just unlocked full access to its e-commerce ecosystem for its Qwen AI agent. This means that if a consumer wants to order food or buy tickets, they can prompt Qwen with their desired item, and the AI agent will handle everything—including payment through Alibaba’s affiliate Alipay.

Previously, the Qwen chatbot was limited to providing recommendations in response to user prompts. Consumers still had to visit other platforms to complete their orders.

Developing the Moat

One of Alibaba’s goals in integrating agentic commerce is to increase user engagement and build a stronger competitive moat. Currently, Tencent’s WeChat holds a commanding position in China’s thriving super app market.

However, Tencent has also indicated that it is pursuing agentic commerce initiatives, and its chatbot Yuanbao could soon see similar upgrades as Qwen. What’s more, TikTok owner ByteDance has already upgraded its AI chatbot to handle certain tasks autonomously within the e-commerce segment of its Douyin app.

The Crucible for Agentic Commerce

This agentic commerce zeitgeist was sparked by Visa and Mastercard, who rolled out iterations of the service last year. Their launches prompted many of the largest U.S. tech players to either introduce agentic commerce platforms or begin building the necessary infrastructure.

Despite these foundational efforts, little headway was made in implementing true agentic commerce last year. This suggests that 2026 could be a crucible for a technology with both dynamic upsides and compelling concerns.

One frequently cited issue with agentic commerce is that, in regions like the U.S., services are splintered across different apps and companies. Super apps, however, could present agentic capabilities to consumers at scale. This makes the super apps from Alibaba, Tencent, and ByteDance compelling proving grounds for agentic commerce.

The post Tencent and Alibaba’s Super Apps Evolve with Agentic Commerce appeared first on PaymentsJournal.

What would happen if President Trump’s proposed 10% cap on credit card interest rates were enacted nationwide? The New York Fed recently examined the effects of interest rate caps imposed by several states—albeit at much higher levels—and found that credit wasn’t so much reduced as it was reallocated.

That said, the comparison isn’t entirely apples to apples. The analysis focused on caps as high as 36% in states like Illinois and South Dakota.

Even so, the findings align with what many industry analysts suspect would occur under a much lower cap. Lending to subprime borrowers fell sharply, with the number of credit accounts dropping by 20% compared with states that imposed no caps. In effect, the caps shifted credit away from lower-income borrowers toward consumers who were already more financially secure.

No Easing on the Budget

Subprime borrowers also saw their debt balances decline by 16.9% under a rate cap, but delinquency rates did not improve. In other words, the caps reduced access to credit without reducing the risks associated with it.

“Lowering credit card rates will not particularly ease household budgets,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “A subprime account, with a score south of 720, has a wide range of obligations beyond just the credit card. Also in that budget are other loan products, such as auto financing, BNPL, and personal loans. These responsibilities often compete with expenses for daily living, rent or mortgage payments, and unexpected costs such as medical bills, auto repairs, and unstable employment.”

“A high-risk borrower is likely to default whether credit card APRs are 10% or 22%,” he said. “Factors such as strained employment and persistent inflation are wild cards that pressure household budgets, and those in riskier credit classifications are most vulnerable to unanticipated events.”

Pricing the Loan for Risk

Borrowers weren’t the only ones to see limited benefits. By constraining card issuers’ ability to price risk appropriately, interest rate caps can have adverse consequences for the overall lending pool.

“Credit scores, particularly those like FICO Scores, predict risk and help lenders navigate lending opportunities and risks,” said Riley. “Pricing the loan for risk is one of the most important components of lending, because it allows the lender to make granular assessments of the account’s ability and intent to pay. Risk-based pricing also ensures that the high risk of a weak credit account is not passed to a borrower classified as low risk.”

The post Interest Rate Caps Shift Credit Access, the Fed Finds appeared first on PaymentsJournal.

Consumers increasingly value flexibility, a dynamic that has helped buy now, pay later products become a fixture in retail payments. A new feature from Klarna and Walmart-backed fintech OnePay adds a new wrinkle to the model.

The companies are teaming up to let OnePay customers convert debit card purchases into installment loans after a transaction has been completed. For example, a consumer who buys a new TV and later faces an unexpected medical expense could use the OnePay app to turn that transaction into a four-payment BNPL loan.

“Post-pay installment plans are nothing revolutionary, they’ve been a part of the card landscape for a while now,” said Ben Danner, Senior Credit and Commercial Analyst at Javelin Strategy & Research. “But we do know that cardholders seek flexibility in how they are able to pay, and this OnePay and Klarna partnership really captures the fervor around BNPL by offering it to customers after payment.”

“We’ve seen a lot of the big BNPL vendors getting into the territory of digital banking—offering debit cards and new ways to pay—and this partnership is an extension of that experience,” he said.

Exemplifying the Trend

Klarna illustrates the broader evolution underway in the sector. The company, which built its reputation as a BNPL provider, has since launched a debit card, applied for a U.S. bank charter, and expanded into peer-to-peer payments in Europe.

More broadly, Klarna has dipped its toes in a range of emerging payments, from agentic commerce integrations to plans for a proprietary stablecoin. This expansionary approach is not relegated to BNPL firms. Many leading fintechs have moved well beyond their anchor offerings. PayPal, for instance, has recently roll out products spanning cross-border payments, agentic shopping, and tax filing.

Playing to Strengths

Although open banking has yet to receive formal regulatory blessing in the U.S., the growing breadth of fintech portfolios suggests the model continues to thrive. Third-party financial services providers form key components of open banking infrastructure, and their growth is beginning to have downstream effects on traditional banks.

Consumers have become accustomed to fintech services that are purpose-built for digital use and generally easier to access than legacy alternatives. As more fintechs offer banking services, the traditional bank relationship anchored in the demand deposit account has come under pressure.

As fintechs continue to band together and broaden their offerings, financial institutions will need to play to their core strengths if they hope to maintain customer relationships.

The post Klarna and OnePay Test Post-Purchase BNPL Conversion Model appeared first on PaymentsJournal.

PayPal is introducing free federal and state tax filing for its debit card holders, allowing refunds to be deposited directly into user accounts. The move expands PayPal’s existing lineup and is intended to encourage broader engagement across the platform.

The service is a collaboration with april, a provider of white-label tax filing tools. Its AI-driven tax engine can pull relevant financial data directly from partner apps, simplifying the filing process, though it requires users to be comfortable sharing that data with PayPal.

Unlike some tax-filing platforms suchas TurboTax or H&R Block, PayPal’s offering is limited to self-guided filing and does not include access to tax professionals. Users are guided step-by-step through entering information, uploading documents, and filing electronically with the IRS. For tax-related questions, april offers an AI-powered chatbot for an additional fee.

Leveraging PayPal’s Tools

In addition to transferring money in and out of their PayPal accounts, customers can pay taxes using several flexible payment options and receive federal tax refunds through PayPal Direct Deposit.

“There are two things in play here,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “The big one is payments and deposits. When you file your taxes, you either need to pay or you get a refund. PayPal can build deposits by having consumers deposit their refund into their PayPal account. If the customer owes money, then PayPal offers ways to pay, like a short-term loan or BNPL pay-in-four arrangement.”

“The second thing is added utility,” he said. “This is another benefit of being a PayPal customer.”

Easing Privacy Concerns

PayPal has also applied for a bank charter, which would allow it to offer interest-bearing savings accounts. If approved, this could give tax filers a place to hold their refunds.

At the same time, a charter would bring additional regulatory requirements, limiting how customer data can be used for marketing and potentially easing some privacy concerns.  

“They may get key demographic data from the tax company like income strata, etc.” said Apgar. “But 100% it would not be personally identifiable information [PII].”

The post How PayPal’s New Tax Service Fits Into Its Overall Strategy appeared first on PaymentsJournal.

As more financial institutions deploy artificial intelligence for key functions such as credit assessments, a group of UK lawmakers has raised concerns that the industry may be unprepared to withstand a major AI-related incident.

The lawmakers recently advised the Financial Conduct Authority and the Bank of England to implement AI‑focused stress tests that could help financial services firms navigate potential issues originating from the technology.

The committee also called on the UK to take a more proactive stance in addressing these risks. For example, it recommended that the FCA publish guidance clarifying how consumer protection rules apply to AI, as well as the extent to which senior financial services managers are expected to understand the AI components embedded in their systems.

Flaws and Risks

According to the report, these measures are increasingly necessary given the substantial risks posed by AI. Flaws often present in this nascent technology could lead to inaccurate credit decisions, elevated fraud risks, and the spread of misinformation.

The report further highlighted the concentration risks associated with major AI models, which are largely facilitated by leading U.S.-based tech giants. These centralized systems could skew consumer decision-making and foster herd behavior in financial markets.

What’s more, UK lawmakers stated that the emergence of agentic AI—and the rush to embrace agentic commerce—has created a potential inflection point for financial institutions. This sentiment was echoed by Experian, which noted that merchants and financial institutions currently lack the tools to differentiate between legitimate AI agents and malicious bots.

The Current Conundrum

Despite these concerns, the dynamic benefits of AI ensures it will remain a priority for financial institutions.

Data from FIS shows that over three-quarters of business and technology leaders believe AI has strengthened their organization’s fraud detection and risk management capabilities. Roughly half of respondents also said their organizations plan to ramp up AI investments over the next two years.

At the same time, a Bank of England official recently underscored that the UK financial industry isn’t fully utilizing data analytics for fraud detection. This highlights the central dilemma facing many FIs: leaders must create strategies that maximize AI’s benefits while mitigating its inherent risks.

The post UK Regulators Voice Concerns About AI’s Role in Financial Services appeared first on PaymentsJournal.

Objections from Coinbase helped scuttle the Senate’s consideration of the Clarity Act, a landmark crypto infrastructure bill. After Coinbase CEO Brian Armstrong said the bill would amount to a “de facto ban” on tokenized equity offerings, the Senate canceled its markup session, which is now expected to be rescheduled in the coming months.

The bill, which has already passed the House, seeks to ending regulatory uncertainty around digital assets by clarifying which assets fall under securities law and which qualify as commodities, dividing oversight between the SEC and the Commodity Futures Trading Commission.   

Armstrong has also argued that the bill would prevent crypto exchanges from offering customers interest on stablecoins. While the GENIUS Act prohibits such rewards, some exchanges have relied on a loophole allowing stablecoin issuers to indirectly fund payments to holders.

The American Bankers Association has warned that allowing crypto to offer interest-like rewards “will siphon trillions from local lending, leaving less money available for car loans, agricultural loans, mortgages, and small business borrowing that drive local economies.”

Crypto Execs Demur

Other crypto executives disagreed with Coinbase’s position.

“We don’t interpret the CLARITY draft as a ‘de facto ban’ on tokenized equities,” Gabe Otte, co-founder and CEO of Dinari, told CoinDesk. “What it does do is reaffirm that tokenized equities remain securities and should operate within existing securities laws and investor protection standards.”

Citron Research went so far as to publicly accuse Coinbase of opposing the Senate’s draft CLARITY Act out of fear of competition.

“Coming This Year”

Coinbase certainly has the clout to pursue legislation that advances its core objectives. Given the pushback from other corners of the crypto community, it’s clear that no single bill can satisfy everyone.

“The decision to pull support for the market structure bill was not made lightly,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “It came from multiple areas including tokenized equities, DeFi issues, and the role of the SEC. Armstrong wants 100% or dang close to it, but there are other solid representatives working on this bill that will continue to move forward and get a solid piece of legislation passed.

“The act has the potential to be good for the industry,” Hugentobler added. “Traditional finance won’t fully embrace this tech until there’s a solid regulatory framework. This is a complex industry with a lot of moving parts, so it may take some time, but I think it’s coming this year. 

The post Coinbase Delays Vote on Clarity Act appeared first on PaymentsJournal.

Visa is bringing stablecoins into the mainstream of global payments, launching a program that lets merchants settle international transactions without ever touching a digital asset.

Under the partnership between Visa and stablecoin infrastructure provider BVNK, businesses in certain markets will be able to pre-fund payments using digital assets and send payouts directly to recipients’ digital wallets. The payouts will run on Visa Direct, Visa’s real-time transfer network, which operates continuously, including on weekends and holidays. BVNK will provide the infrastructure connecting wallets and blockchains, as well as conduct compliance checks.

The new offering builds on a pilot program Visa launched last October, marking the first time a major payment rail—one that already processes the lion’s share of cross-border transactions—has adopted stablecoins.

Getting Ahead of the Fintechs

Other payment services like Stripe and Shopify offer similar stablecoin settlement capabilities. But Visa’s prominence in the global payments industry is likely to make merchants far more comfortable adopting the model at scale.

“The way Visa and BVNK have it set up, their service permits merchants to accept fiat payment just like normal payments, where stablecoins are being used to settle on the other side,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “Essentially, with the indirect method that Visa is leveraging, merchants won’t have to touch stablecoins or cryptocurrencies if they don’t want. This eliminates price volatility, treasury management associated with typical cryptocurrencies, and several other things that retailers don’t want to deal with.” 

Aggressive Moves in the Space

The new offering should further strengthen Visa’s foothold in the cross-border payments market. It already processes more than $4.5 billion in annualized stablecoin settlement volume. Still, that’s just a drop in the bucket for Visa Direct, which has handled nearly $1.7 trillion annually in payments.

Visa has made several aggressive moves in the stablecoin market within the past year. Last May, the company invested in BVNK, which processes over $30 billion in stablecoin payments annually, through its venture arm.

Last month, Visa launched a new advisory service to help banks, credit unions, and other enterprises implement their own stablecoin strategies. Offered under the Visa Consulting & Analytics umbrella, the Stablecoin Advisory Practice provides training, market analysis, strategy development, use-case sizing, and technical support for organizations exploring digital assets.

The post Visa Eases Stablecoin Payment Settlement for Merchants appeared first on PaymentsJournal.

As National Use Your Gift Card Day approaches, many retailers are developing strategies to encourage consumers to spend the unredeemed gift cards they received over the holidays.

The spending power significant: U.S. consumers are estimated to be holding roughly $23 billion in unused prepaid cards. This latest demand, combined with traditionally slower January sales, led to the creation of National Use Your Gift Card Day seven years ago.

“Gift cards fill a need that no other gift can give, and that means that a lot of U.S. consumers are sitting on gift cards they got in the past month from the holidays,” said Jordan Hirschfield, Director of Prepaid Javelin Strategy & Research. “Most of those are probably retailer-specific, but you have some open-loop gift cards too, and both need redemption.”

“It’s always the most popular gift both as a recipient and to give, but givers generally prefer those retail, single-vendor gift cards because it seems a little more personal, even though recipients marginally prefer the Visa, Mastercard, or American Express open-loop cards,” he said.

Preparing for Repeat Customers

Encouraging consumers to use their gift cards can deliver dramatic benefits for merchants. According to Javelin, over two-thirds of consumers received a gift card this holiday season, and roughly a quarter of those cards carry higher balances than the previous year.

“That means retailers that are preparing to accept those gift cards should be ready,” Hirschfield said. “The date of January 17 makes sense because the majority of recipients of gift cards will use them within a month. Not only will they spend it within a month, they will spend more than the value of that card. For retailers, if it’s a $50 gift card and they’re spending $75, you’re getting uplift of spend that maybe they weren’t intending to buy, and they’re buying more profitable items.”

Beyond the immediate revenue opportunity, gift card redemption gives merchants a chance to build long-term customer relationships.

“Roughly half will become a repeat customer of that brand when they get a gift card and they use it,” Hirschfield said. “Four out of 10 will join the loyalty program; another four out of 10 will download that app. Especially when you think about popular gifts that people getting as gift cards—quick-serve and fast food, coffee shops, mass retailers like your Walmarts and Amazons—all those have easy to utilize and frequently utilized apps.”

“You can incentivize people by offering a bonus or different things like that,” he said. “But they’re going to download that app, and about 20% are going to refer that retailer to another friend or family.”

The Redemption Pattern

All these benefits stem from the simple act of receiving a holiday gift card. Although many retailers focus heavily on driving gift card purchases, redemption is often even more critical, because it represents a self-use choice.

For merchants, National Use Your Gift Card Day can provide a valuable lift during an otherwise slow first quarter. However, effective prepaid strategies should stretch far further than a single day.

“We have Father’s Day, Mother’s Day, and graduation—all the May and June holidays,” Hirschfield said. “Birthdays are the number one reason people get gift cards, and birthdays happen 365 days a year—366 some years. You’ve got thank you gifts, house warmings, religious occasions, births, weddings, and all these things.”

“Valentine’s Day is coming up and people don’t think that it’s a great gift card occasion, but I might send my kids $10 to show them I care about them while they’re off at college,” he said. “These are all micro-events that will not top the fourth-quarter explosion of sales, but all are additive. How the redemption pattern went in January is critical to how the redemption pattern will go all year round.”

The post The Best Time for Consumers to Spend Holiday Gift Cards? Now appeared first on PaymentsJournal.

In many of the world’s fastest-growing economies, small- to medium-sized businesses (SMBs) rely on efficient cross-border payment solutions to thrive. While numerous options exist, Ant International’s platform is seeing significant growth.

The global payments giant supported more than 2 billion cross-border transactions in 2025, many originating from rapidly expanding markets like Southeast Asia, South Asia, the Middle East, and Latin America.

Overall, Ant International serves over 50 million merchants globally—most of them SMBs—through its Alipay+ and Antom platforms. These solutions allow merchants to accept a wide range of QR, mobile, and card payments. Ant International plans to further expand its presence in regions like the Middle East and Latin America.

Expanding the Super App

In addition to supporting cross-border payments, Alipay+ operates as a unified wallet gateway, connecting global merchants to a plethora of payment types. This platform should not to be confused with the Alipay consumer app, which, along with WeChat, dominates payments in China.

These super apps have evolved far beyond payments, becoming a one-stop shop for virtually all consumer needs. One of Ant International’s goals in expanding the Alipay+ gateway is to develop similar digital wallet and super app ecosystems in other markets. Alipay+ already integrates with many leading domestic mobile systems, such as Indonesia’s DANA and Thailand’s TrueMoney.

From Domestic Systems to Global Reach

As these technologies have streamlined global communications, demand for cross-border payments has accelerated. However, international transactions have long been plagued by challenges, including high fees, low visibility, and slow settlement times.

Connecting domestic mobile and real-time payments systems has been an oft-proposed solution for these issues. For example, the European Union recently unveiled plans to tie into India’s UPI real-time payments system for cross-border payments.

As a global payments ecosystem, Ant International is uniquely positioned to become a major player in the market. In addition to its mobile payments infrastructure, Ant International has developed a blockchain that could bring the efficiencies of digital assets to its platform.

Case in point: Ant International and HSBC recently partnered to pilot cross-border tokenized deposit transfers over the Swift network, leveraging Ant International’s blockchain.

The post Ant International Logged Over 2 Billion Cross-Border Payments Last Year appeared first on PaymentsJournal.

Buy now, pay later pioneer Klarna has launched peer-to-peer payments in 13 European countries, expanding its services as it moves closer to becoming a full-service digital bank. In a market already crowded with P2P apps, Klarna’s millions of existing users could give it a competitive edge.

For now, Klarna users can only send money to people who already have a Klarna account. However, the company plans to expand the feature to allow transfers to non-Klarna users and enable cross-border payments.

The service is designed to integrate with Klarna’s existing offerings. Transfers are sent from the user’s Klarna balance, and funds are only sent once the amount is confirmed and eligibility and security checks are completed.

A Full Range of Banking Services

As it expands its services, Klarna already holds a full banking license in the EU. It has yet to obtain similar status in the U.S., although it launched its IPO in September. The Klarna Card, its first debit card, has already reached 4 million sign-ups following its debut in July 2024.

“Klarna continues to signal that it wants to be more than just a BNPL provider,” said Ben Danner, Senior Analyst, Credit and Commercial at Javelin Strategy & research. “They have launched debit cards, are now offering P2P services, and are driving customers to spend more and more time within their app.”

A Mature Market

P2P apps are more popular in the EU than in the U.S., driven by Europe’s greater acceptance of open banking. Most European countries offer several local P2P services, and in many markets, the sector has already matured. Bizum, for example—owned and operated by leading Spanish banks—dominates the P2P market in Spain, one of the 13 countries where Klarna’s service will be available.

This presents barriers for new entrants. Meta, for instance, spent eight years trying to establish its own P2P service in Europe before quietly shutting it down earlier this year. 

“It’s difficult to get people to switch away from a P2P method that they are already comfortable using,” said Danner. “It will be an uphill battle challenging a lot of major players already out there. However, millions are already using Klarna, and therefore this is really a product enhancement with little friction.”

The post Klarna Wades into a Crowded European P2P Market appeared first on PaymentsJournal.

Artificial intelligence is helping shoppers find items and compare prices, but it also introduces new risks. According to Experian, the top fraud threat this year is AI agents and their potential to disrupt the evolving retail landscape.

In the past, merchants and financial institutions relied on blanket defenses to identify and neutralize any activity originating from bots. That approach is no longer sufficient as agentic commerce gains traction this year, leaving organizations struggling to distinguish malicious bot traffic from legitimate AI agents.

Experian notes that issues are heading into a crisis that will demand proactive responses, pushing organizations and regulators to examine liability obligations and the regulatory framework governing agentic commerce.

An Accelerating Threat

Even without widespread agentic activity, fraud is accelerating. Criminals can now craft highly targeted messages, and social media has become a breeding ground for scams.

These fraudulent messages are increasingly difficult to detect because cybercriminals use AI to generate realistic communications. Bad actors also leverage AI to create deepfakes, tricking employers to gain access to remote jobs or deceiving consumers into sending funds. This functionality has made deepfakes the second most impactful fraud trend of the year, per Experian.

“Consumers will always be the weakest link,” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research. “Socially engineered schemes, whether driven by AI or not, will continue to fool consumers into clicking on malicious links, friending malicious actors they do not know, and giving out personally identifiable information about themselves. AI just makes the risk of socially engineered attacks more targeted and personal, which is a real worry for businesses’ customers and employees.”

“Enhanced email and firewall security while become increasingly critical to protect employees from themselves, and more businesses, financial services in particular, should consider providing ancillary security services, such as identity theft protection, to their customers that includes firewall provisions, virtual private networks, and spam filtering for text messaging and emails.”

Dynamic But Nascent

It is no coincidence that these threats leverage one of the most powerful technologies of our time: AI. Unfortunately, bad actors have been able to harness AI capabilities faster than many organizations, which are often constrained by regulatory, customer, and internal considerations.

Some organizations, however, have begun to take defensive action. Amazon has blocked third-party bots, including AI agents, from interacting with its platform. The e-commerce giant even went so far as to take legal action against AI platform Perplexity, seeking to block its AI agents from shopping autonomously on Amazon.

While this may provide a short-term solution, consumers are increasingly comfortable with using AI in retail settings—at least in certain contexts. As a result, agentic commerce is reaching a crossroads, where all stakeholders must define the roles and permissions AI agents should be granted.

These considerations could further delay the fully adoption of this dynamic yet still nascent technology.

The post Experian Raises Concerns Over Emerging Agentic Commerce Fraud appeared first on PaymentsJournal.

Massachusetts, one of the few states where it is still illegal for businesses to surcharge customers for credit card payments, is considering new legislation that would reverse that policy. The proposal is the latest development in a broader pushback against rising credit card fees.

The Massachusetts bill, which passed out of committee last week, would allow to charge customers a fee for using a credit card, provided the surcharge doesn’t exceed the business’s actual cost to process the payment. Merchants that impose a surcharge would be required to clearly disclose the fee before payment, and the surcharge amount would have to be printed on the receipt.

The legislation also states that credit card companies cannot stop businesses from offering discounts to customers who pay by cash or check.

Who Ultimately Benefits?

Currently, Massachusetts is one of only three states—along with Maine and Connecticut—that explicitly ban credit card surcharging. While the bill is being framed as a win for both consumers and merchants, there is also much jockeying behind the scenes by payment networks, which have a financial stake in the outcome.

“It’s a contentious topic because the networks don’t like it,” said Ben Danner, Senior Analyst, Credit and Commercial at Javelin Strategy & Research. “Surcharging causes people to switch into different payment methods in order to not have to pay the extra fee. If they pay in cash, Mastercard and Visa lose out on that transaction.”

Consumers don’t like it either, especially younger ones. According to research from Javelin, roughly a quarter of consumers ages 18 to 44 say they would take their business elsewhere if required to pay a credit card surcharge.

Credit card surcharging can also push consumers toward debit cards. While the average credit card surcharge hovers around 2% to 3%, debit card surcharging remains illegal in all 50 states.

Trump Weighs In

The issue gained greater salience when President Trump, fresh off declaring a 10% cap on credit card rates, endorsed the long-stalled Credit Card Competition Act (CCCA). The law would allow merchants to choose from multiple payment networks.

Its stated goal is to break the current dominance of Visa and Mastercard, who control 80% of all payments, fostering competition that could ultimately lower costs for consumers. Laws like the Massachusetts proposal could put consumers in a position to see exactly how much their credit card usage costs and to choose their preferred payment networks accordingly.

The post Massachusetts Bill May Pass Credit Card Surcharges to Consumers appeared first on PaymentsJournal.

Does Google have what it takes to become the dominant player in agentic AI? Its Universal Commerce Protocol (UCP), unveiled at the National Retail Federation’s annual show, is an ambitious initiative designed to let AI agents manage the entire shopping journey—from discovery through checkout. Still, the effort may face an uphill battle in gaining acceptance from both merchants and consumers.

UCP was developed in collaboration with companies including Shopify, Etsy, Wayfair, and Target. Its first rollout is expected to be a new checkout feature that allows users to buy directly from Google’s AI Mode or Gemini.

“Google has long been number one in search, and now consumers are using AI searches to shop,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research.  “Companies like OpenAI and Perplexity are rushing to build standards that they hope will help them protect their corner of the market in agentic commerce. For example, if the Google standard takes hold, OpenAI may lose relevance in search when it comes to shopping.”

Who Does It Work For?

The broader offering also includes a chatbot, Business Agent, which allows shoppers to interact directly with brands. Still in testing is a service called Direct Offers, which would enable retailers to surface promotions and discounts to AI agents. Together, these services raise a fundamental question: who is the shopping bot ultimately working for—the consumer or Google?

“If you follow what happened in search, first we got search results, then we got sponsored results at the top of the page, now we have AI results at the top of the page,” said Apgar. “When the Google shopping agent makes a purchase, is the bot getting the best deal for the consumer or making the choice that makes the most money for Google?”

The Problems for Merchants

That’s not the only concern. Retailers may face increased exposure to fraud, higher return rates if AI agents—not consumers—are making the purchasing decisions, and potential dilution of brand equity. As a result, merchants could end up charging a premium to agentic shoppers, much as consumers today pay higher prices for food delivered via DoorDash.

“The fact that Google assumes that merchants are clamoring so much to support agentic commerce that they will offer a discount is unrealistic at this stage,” said Apgar. “Merchants today use bot-blocking software to keep competitors from scraping price info and clogging up their servers with unwanted traffic that slows response times for real customers. Now merchant have to figure out which bots to allow and when.”

The post Google’s Agentic AI Ambitions Face a Steep Climb appeared first on PaymentsJournal.

When the president announced the following statement on credit card price controls, credit policy managers must take note and prepare for market disruption.

Javelin commented on this topic in September 2024, when candidate Trump raised the 10% rate cap during his presidential campaign. (See: Market-Drive, Risk-Based Credit Card Price Controls Would Disrupt Borrowing and Lending). In that report, we suggested that credit card lending (and borrowing) would essentially stall because the rate would create losses for all issuers. Were it to happen, our simulation showed that credit card lenders would lose billions, ending with a potential 6.4% negative return on assets in a steady state. 

By 2028, lenders could mitigate future losses by contracting lending and imposing stricter FICO Score cutoffs. To minimize risk, credit card lenders would need to lend only to those with FICO Scores of 740 or better, representing 118 million adults. Practically speaking, they would need to cease lending to those in the United States with FICO Scores <740, or about 114 million adults.

Bracing for Impact: Consumers, Investors, Issuers, and Merchants

Credit card lenders have a responsibility to ensure lending is safe and sound and to protect their investors and balance sheets. Lending into credit score ranges that will result in losses is bad business, and financial markets will not accept operational losses, even if executive orders cause them. 

A broader concern for lenders and investors is how other financial markets, including auto loans, consumer loans, and shelter products, could be affected by an interest rate mandate. Merchants should be on notice that much of the $4 trillion that passes through credit cards is vulnerable to reductions in credit availability, which will affect verticals ranging from durable spending to everyday card use and consumable products. Credit card issuers will need to rethink their business models entirely, as profitability will no longer swing from black to red.

Four Strategies to Mitigate Risk from 10% Interest Pricing Controls

Although the discussion centered on a Truth Social post, it would be reckless not to consider the impacts and countermeasures. Here are four facets to consider; each requires some form of regulatory endorsement but is germane to the 10% issue, which will also require more than a comment on social media:

Overhaul the Minimum Due Strategy. The construction of a minimum due is an American invention that allows a small portion of the balance to be paid while interest is serviced. The metric is roughly 1/36 of the outstanding balance. Many companies use the same format, but others do not. India, for example, is closer to 1/20. This higher amount benefits the consumer by paying off a larger portion of the principal balance each month. Canadians in Ontario recently underwent a mandated increase in minimum due amounts, which appears to be successful. Although it does not affect other provinces, the province requires that all credit card transactions amortize on a 5% of balance standard. A similar action in the U.S., perhaps doubling the minimum due to a 10% increase, would mitigate much of the risk in interest rate spreads. However, expect a spike in delinquencies as households face less available credit and higher payment rates.

Shut off lending to FICO Scores < 740. This will reduce lending, but it will eliminate future lending risk to high-risk borrowers, directly improving operational revenue. Cutting off credit limits to those outside prime credit is severe, but the lender has a responsibility to its shareholders, particularly given the public benefit of credit extension.

Impose a transaction fee on borrowing. To offset the disruption caused by an interest price control, card issuers should consider alternative uses in Sharia-compliant lending. Islamic financing prohibits charging interest (riba). Fees may be charged, but interest may not. Perhaps the industry needs to consider a blended approach of reducing interest rates and adding a transaction fee to offset the revenue loss.

Make Credit Card Interest Tax Deductible Again. Credit card interest was tax-deductible up until the Tax Reform Act of 1986. To control inflation and encourage savings, the deduction was eliminated.  While the impact will vary by adjusted income, a return to deductibility would provide a meaningful benefit to many consumers, allowing the current average interest rate of 22.25 to remain competitive in the market.

Summary

The executive-level discussion of credit card interest rate price controls requires credit card issuers to position themselves and protect their investors. We propose four action items that will require bank lobbying and influence to achieve; in the interim, we suggest that each contingent be considered. For borrowers, it will be a tight credit market. For merchants, lost sales. For issuers, a revenue challenge, and for investors, an unacceptable situation.

The post 10% Credit Cards: A Roadmap for Issuers appeared first on PaymentsJournal.

In another record-breaking holiday shopping season, consumers increasingly turned to their mobile phones. The majority of online transactions occurred via smartphone, surpassing a quarter of a trillion dollars for the first time.

According to the 2025 Holiday Shopping Trends report from Adobe, two trends continued to drive mobile purchases: buy now, pay later and agentic AI.

Good old-fashioned convenience also played a part, as mobile shopping peaked on Christmas Day, accounting for two-thirds of all sales. Cyber Monday remained the biggest e-commerce day of the season, with $14.25 billion in online spending—up 7.1% from 2024.

BNPL for the Holidays

For the first time, BNPL spending hit $20 billion, a 9.8% increase and $1.8 billion more than the 2024 season. More than $1 billion of this was spent via BNPL plans on Cyber Monday alone. Originally an e-commerce service, BNPL has only recently expanded into physical cards, with over 80% of purchases made via smartphones this past season.

“BNPL is nearly ubiquitous for all major e-commerce retailers at checkout, and BNPL vendors operate their own digital marketplaces which encourage shopping through strategic offers,” said Ben Danner, Senior Analyst, Credit and Commercial at Javelin Strategy & Research. “BNPL is particularly popular among higher ticket item purchases, which certainly occur around the holidays—think of getting that new 4K TV. Its strong growth particularly in the holiday season is demonstrative of its success in the market.”

Agentic AI Enters the Store

Although smaller in scale than BNPL, agentic AI grew even faster during the holidays. Traffic to retail sites from generative AI tools jumped nearly 700% from 2024, reflecting their increasing prominence throughout 2025.

Separate data from Salesforce reported that agentic AI influenced more than 20% of global retail sales during the season. Usage surged closer to the holidays, with shoppers relying on these tools 66% more in December than in November.

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Biometric payments are moving from futuristic concept to everyday reality. Point-of-sale provider Clover is adding face and palm scanning technology to its platform, bringing faster and more secure checkout experiences to small- and medium-sized businesses.

The integration comes through a deal with Wink, aiming to bring biometric authentication to ra range of retail settings.

“This is a fantastic strategic move by the Clover team, and really redefines the level of POS tech available to SMBs,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Innovation at the checkout has long been driven by enterprise retailers who have both the resources and capital to implement new technologies. Now, the frictionless process of biometric payments and loyalty is available to millions of SMBs as part of the Clover platform.”

A Biometric Mainstay

Beyond security and convenience, one of the main drivers of biometric adoption in merchant use cases is consumer familiarity. The near-ubiquity of smartphones has made facial and fingerprint recognition a routine part of daily life.

However, adoption has faced challenges, as consumers must actively opt into biometrics programs. This creates both educational and security responsibilities for providers. To the latter end, Clover will manage customers’ biometric profiles via tokenization, keeping personal data separate from payment credentials.

From Pilot to Implementation

The opt-in requirement does, however, limit certain use cases, as many shoppers won’t enroll for a one-off purchase. Clover plans to initially rollout the program in quick-service restaurants, sports venues, and retail stores.

Sports and entertainment venues are particularly suited for biometric integration, as the technology can dramatically shorten queue times. Season ticket holders and loyal fans may also be incentivized to join their team’s biometrics authentication program.

This loyalty angle is another reason why more pilots and trials of biometric payments are emerging. While many programs are still in early stages, recent developments signal process. Notably, Amazon Pay became one of the first digital wallets to support biometrics on India’s real-time payments giant UPI. Along with Clover’s launch, this suggests that biometric programs are increasingly moving from trial phases to broader implementation.

The post Clover to Add Wink’s Biometric Tech for Retail Payments appeared first on PaymentsJournal.

After much discussion and speculation, JPMorgan Chase has agreed to assume Apple’s $20 billion credit portfolio from Goldman Sachs.

The deal offers benefits for all parties involved. For Goldman Sachs, it represents the end of a rocky foray into consumer lending and a return to its core business. For JPMorgan Chase, the bank will acquire a sizable credit portfolio at a discount while strengthening ties with one of the world’s leading technology companies. For Apple, the arrangement places its credit business in the hands of an established consumer lender.

“The problem here is Apple wanted everybody who had a phone to have a card,” said Brian Riley, Director of Credit and Co-Head of Payments at Javelin Strategy & Research. “Goldman Sachs accommodated it for a while, and then it started to blow up and you have these billion-dollar credit write-offs, and Goldman Sachs had to get out of it. Being an investment bank and then trying to move into retail—it was a very different culture.”

Weathering the Transition

To prepare for potential risks, JPMorgan will record a $2.2 billion provision for credit losses when it reports its Q4 2025 earnings. However, as the largest lender in the United States—and soon to be even larger—Chase is well positioned to weather this transition, which is expected to take roughly two years.

“It’s a win for Chase in some ways,” Riley said. “It doesn’t bring in a zillion new customers—Chase is already in one out of two households in the U.S—but it does bring in some good technology. It is a springboard to reach millennials and younger adults, but Chase is often already there. But it increases volume by 10%, and being able to do that, in itself, is important.”

In addition to the increased volume, Chase will acquire the Apple Card portfolio at a discount of over $1 billion. This reflects the portfolio’s higher concentration of subprime and less-than-optimal borrowers.

“Chase is a very conservative lender, and that’s want you want out of the biggest bank in the United States,” Riley said. “They’re not going to carry over the Goldman Sachs standards. You can expect that there are going to be bank-grade lending standards in place, and that’s important.”

That said, Chase has demonstrated flexibility in the past. For example, with its Chase Rise card, the bank has softened underwriting criteria when borrowers open a checking account. The rationale is that consumer who deposit their salaries into a checking account are more likely to be stable, long-term relationships.

A Wobbly Portfolio

While Chase could bring a similar model to Apple’s portfolio, it would still face risks that require a response.

“They can mitigate a lot of the risks by shutting down accounts,” Riley said. “When you start looking at the portfolio and you get down and dirty into it, there’s going to be some pockets they want to grow and there’s going to be some pockets they want to diminish. They can do that systemically and not have the emotion of tying into the old business.”

Cleaning up Apple’s portfolio will require significant legwork on Chase’s part, but this has already been factored into the deal.

“The big thing to point out is usually these deals come with a premium,” Riley said. “This comes with a discount, and that tells you how wobbly the portfolio is. It will take years for that to work its way out of the system, but it’s something that Chase is used to. It’s a very large bank with lots of computer horsepower behind it.”

The post JPMorgan Chase Brings a Fresh Approach to Apple’s Credit Card Model appeared first on PaymentsJournal.

After introducing it as a product for business transactions last August, Wyoming is making its stablecoin available to the general public this week. The next question for the Frontier Stable Token (FRNT) is whether a broader market will emerge for the asset.

The token is available for purchase via Kraken on the Solana blockchain and through Rain, the Visa-powered integrated card platform, on the Avalanche blockchain. Its holdings will be invested exclusively in U.S. dollars and short-duration U.S. Treasuries.

Wyoming has emerged as a leading state in crypto adoption, having passed roughly 30 laws to encourage innovation in digital assets. Kraken moved its headquarters from San Francisco to Cheyenne, Wyoming, last June—a move that likely played a role in securing the rights to trade FRNT.

Looking for Private Use Cases

Wyoming has pushed the notion that FRNT is intended for retail use. The coin settles in seconds, carries fees of less than one cent per transaction, and is available to anyone with an internet connection. The state has even suggested that consumers use the stablecoin to make government payments.

“Last year my office took in about $3.4 million in credit card transactions, which cost our constituents about $70,000 in fees that our processors collected,” Converse County Treasurer Joel Schell noted in a prepared statement. “We’re anxious to get out of that climate and to move into something else. Electronic payments, especially the stable token, would let us get more efficient.”

There’s still more the state could do to promote adoption.

“Until Wyoming either integrates the FRNT stablecoin directly into state and county online portals with a one-click pay user experience, offer clear incentives like waiving surcharges or adding discounts, or just make it feel as easy as a card checkout, it won’t hit that adoption curve,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research.

Yield on Tap?

To further encourage private use, some state officials are considering the possibility of offering yield to investors holding FRNT. Wyoming State Senator Chris Rothfuss has made the case that the state should be able to do this because it is not a private business, unlike other stablecoin issuers.

For now, interest generated from the reserves will help fund Wyoming schools. But Anthony Apollo, the Executive Director of the Wyoming Stable Token Commission, has spoken out in favor of distributing a portion of the token’s Treasury interest directly to individual holders.

The post Wyoming’s Stablecoin Debuts for the General Public appeared first on PaymentsJournal.

As more financial institutions expand into digital assets, UK banking giant Barclays has invested in newly launched Ubyx, a platform that facilitates the transfer of stablecoins and tokenized deposits.

Although the size of the investment was not disclosed, Barclays said it marked the bank’s first investment in a stablecoin company. However, it was not the first vote of confidence for Ubyx, which has already attracted backing from Coinbase and Galaxy Digital, among others.

Barclays said its objective is to bring digital assets under the financial services industry’s regulatory umbrella.

“This is an interesting move on Barclays’ end,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “This is more of a payment network infrastructure play rather than a ‘bet on crypto.’ If stablecoins and tokenized deposits are going to function as regulated digital/tokenized cash, redemption needs to become predictable and issuer agnostic.”

Moving Incrementally

Institutional investments in digital assets has accelerated following the proposal and passage of the GENIUS Act in the U.S., which regulates stablecoins. Previously, many financial institutions were reluctant to pursue stablecoin strategies due to compliance concerns.

Now, nearly all leading U.S. banks are moving forward with stablecoin plans, albeit incrementally. For example, JPMorgan Chase recently launched JPMCoin, though the stablecoin is primarily designed for transfers among institutional clients.

Similarly, Citi said it’s exploring a stablecoin but considers tokenized deposits as more promising for its use cases.

Redeeming at Par

Although traditional banks have taken a more measured approach to stablecoins, many other organizations are forging ahead. This includes companies as diverse as Sony, which plans to launch a stablecoin for its gaming ecosystem, and buy now, pay later leader Klarna.

Early discussions around stablecoins focused on Circle and Tether, and on which stablecoin would ultimately prevail. However, it is becoming clear that the stablecoin market is likely to be highly fragmented.

This fragmentation is what makes a platform like Ubyx particularly intriguing to investors, as it could potentially serve as a central hub connecting these various offerings.

“Anyone can issue a token,” Hugentobler said. “The winners here are those that can redeem them at par at any time within the banking ecosystem. They won’t be treated as cash unless this aspect of redeemability is 100% reliable. At the end of the day, FIs will require interoperability between tokenized deposits and stablecoins. Barclays understands this, and that’s why they allocated.”

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Online retailers are pushing back after Amazon’s Shop Direct agentic AI program trained its bots on their websites without permission. In addition to not being asked to participate, some retailers claim that Shop Direct directs customers to products they don’t even stock.

Businesses have been posting about the issue on social media, fueling a wider conversation. Angie Chua, who runs a Shopify website that sells stationery, told CNBC that she began receiving orders from Amazon’s Buy for Me agent despite never opting into the program. She ultimately had to request that Amazon pull her products—a process that took several days to complete.

A Losing Proposition

Even for merchants seeing incremental sales through Amazon, the gains may be a temporary victory. Retailers want customers spending time on their own sites—browsing products, reading content, and personalizing their experience. That engagement helps merchant build direct relationships with customers, enabling follow-up marketing and the development of a distinct brand identity.

Many merchants have already decided not to sell through Amazon at all. Beyond paying a fee to the platform, their products risk becoming just one of many indistinguishable listings. And shoppers scrolling through Amazon’s listings are generally just looking for the lowest price.

“This is very much a Trojan Horse strategy,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Once Amazon gets the customer used to going to their site first, they become the gatekeepers for customers. Pretty soon, sites will lose their ability to attract their own customers.

“This is the primary reason that online retailers use bot-blocking technology, to keep shopping services from scraping prices from their site,” he said. “No retailer wants to be the low-cost seller to somebody else’s customer.”

Not Ready for Prime Time?

The bad blood between Amazon and its unwitting partners has left some analysts wondering whether the agentic AI program was ready to be rolled out.

“Amazon is following the previous tech generation’s ‘shoot first, ask questions later’ playbook,” said Christopher Miller, Lead Analyst of Emerging Payments at Javelin Strategy & Research. “Every merchant will have to be diligent in controlling and protecting its information.

“These kinds of attacks won’t stop,” he said. “It highlights the importance of having a strong strategy for online presence. For smaller retailers, that means having a good partner on the e-commerce side who is developing robust capabilities around the emerging agentic space.”

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The CFPB remains in flux, but it met its requirement to report on the credit card industry. Although the report is typically produced mid-year for the prior year, the requirement was met when it was published on December 30, 2025.

The report is full of relevant industry metrics that indicate the business is operating effectively. You can find the 191-page missive here. We identified 12 key items that provide a clear view of what is happening in U.S. Payments.

Where People Use Their Credit Cards and the Balances They Carry

• The top 5 spend categories were retailers ($743 billion), professional and financial services ($646 billion), food and groceries ($319 billion), restaurants ($317 billion), and transportation/travel services ($238 billion).
• Superprime credit card users carried the lowest amount of monthly cycle-ending balances, at $2,551 as of July 2024. This was up from $2,045 in July 2014. Weaker-scored segments increased more substantially, with Deep Subprime surging from $3,480 to $5,484, and Subprime rising from $3,562 to $5,960 during the period between 2014 and 2024.
• The average APR for a Superprime cardholder went from 15.1% in Q1 2015 to 23.1% in Q4 2024.  Cards were much pricier for lower-scoring segments, with Deep Subprime rising from 22.1% to 29.1% over the same period.

Payment Habits Were Healthier

• In 2015, 36.3% of cardholders paid their total balance; in 2024, the metric hit a lofty 42.5%.
• For minimum due payers, only 5.5% of super prime paid the minimum due only, versus Subprime, with a whopping 30.9%.
• Persistent debt, those dollars that languished for more than a year, affected 41.1% of Subprime and Deep Subprime, and only 2.4% of Superprime.

Fewer Bank and Credit Union Issuers

• 1,146 banks carried credit card balances in 2015. The number plummeted to 724 in 2024.  Credit union issuers fell from 3,614 down to 2,972.
• Distribution of card balances by issuer size was constant, with 83.6% of the top ten issuers controlling the market, and 11.4% of those ranked between 21 and 40. All other issuers only affected 5.0% of balances.
• Big issuers had stronger portfolios. Those over $100 billion accounted for 94.9% of Superprime credit scores, compared with 5.1% for issuers under $100 billion. For Subprime and Deep Subprime, smaller banks held a 67.4% share, while larger issuers accounted for only 32.6%.

Javelin Research Cited by CFPB

• The CFPB cited two pieces of Javelin research in this critical report.
• Javelin’s 2023 Identity Fraud study was used to size the time-consuming impact of new account fraud resolution. The agency also cited Reducing Operational Risk Through Careful Credit Line Decreases, as part of a risk-averse credit card risk strategy. 

What This Means to Credit Card Issuers

2026 should be a year of “full speed ahead,” assuming the economy continues to be strong.  Anticipated tax refunds should help many clear debt, and transaction volumes should increase as consumer confidence in the economy grows. For small issuers, be careful. Offers must be more competitive to attract the best cardholders, and consumers are poised for a healthy payments year.

The post CFPB: U.S. Credit Cards are Prosperous and Strong appeared first on PaymentsJournal.

Roughly $23 billion in gift cards go unused in the U.S. after the holiday season, and consumers now have more options for spending this unexpected windfall.

Gift cards have become a top choice for shoppers, offering a personal touch from the giver while letting recipients select exactly what they want. This prepaid trend fueled significant holiday spending—according to data from National Use Your Gift Card Day—U.S. shoppers were projected to spend around $29 billion on prepaid cards.

In this gift card frenzy, there is always a chance that a card ends up tucked away at the bottom of a drawer or a purse, waiting to be rediscovered.

“While Javelin research shows that the majority of consumers will use their gift cards quickly and in full, there will always be a small segment that sit on their card values,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “We are seeing positive trends for retailers who are able to digitize their physical cards which enables easier ongoing redemptions and potential reloads.”

Donating the Balance

Another emerging prepaid trend is the use of gift cards for charitable donations. When consumer don’t want to shop at the retailer on a branded card—or still have an unused balance—they can donate the funds to charitable organizations such as St. Jude Children’s Research Hospital, GiftCards4Change, or Donate Your Card.

“A key fact is that donations do not need to just be with currencies,” Hirschfield said. “Gift cards act as a currency replacement and can be incredibly useful to organizations of all types and also retain the tax benefits of a donation.”

Beyond donation acceptance, gift cards have become a pivotal part of many nonprofit disbursement operations. These organizations often rely on manual processes and traditional payment methods like paper checks. Conversely, gift cards are faster to deliver, can be digital or physical, and put purchasing power directly into the hands of those in need.

Self-Use Synergy

Aside from the benefits for nonprofits, organizations of all types are beefing up their prepaid programs. Gift cards and stored-value accounts—such as the balances shoppers keep at Starbucks or Amazon—can integrate seamlessly with loyalty and engagement programs.

This highlights one of the most important trends in prepaid: the increasing frequency of self-use. This trend is likely to continue growing as consumers have more options to buy and spend gift cards, potentially reducing the number of unused balances.

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A multi-year crypto theft ring has been traced back to Russian hackers who stole sensitive data from LastPass. Armed with that information, the criminals were able to access roughly 30 million users’ vaults and steal more than $35 million in cryptocurrency.

The scheme began in 2022, when cybercriminals breached LastPass, a tool millions of people use to store their passwords securely. Using the stolen information, they were able to break into the very crypto vaults the password manager was designed to protect. Although those vaults were also password-protected, the criminals reportedly took the systems offline, giving them time to figure out how to unlock them.

According to Blockmanity, many users relied on LastPass as their primary layer of security, leading some to use weak master passwords, like “password123.” The breach continued through 2025, with new waves of wallet drains indicating that the criminals continued to successfully access users’ vaults and steal thousands of dollars in crypto.

An Increasing Vulnerability

For years, password managers have been largely effective against hacking attempts. But recent crypto thefts underscore that users need to protect themselves at every step of the process. If master passwords had been stronger, the criminals would have had far less success.

“To access password manager vaults, consumers use basic usernames and passwords,” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research. “Any credential or account secured by traditional security and authentication methods, such as username and password, are increasingly vulnerable, especially when those passwords are saved in browser history and autofills.”

“If those credentials are compromised, then hackers can access all of the credentials saved in the password manager vault, bypassing encryption, especially if those same credentials are saved in browsing history and autofill data,” she said. “These areas are increasingly being targeted by malware strains that fall under the infostealer category.”

Slow-Motion Hacking

The incidents also highlight how long these breaches can unfold. LastPass discovered that portions of its source code and proprietary technical information had been stolen shortly after the 2022 breach. The company took steps to minimize the damage, including advising users to change their master passwords.

Despite these efforts, the thefts continued for three years. The stolen data gave the criminals ample time to break into crypto vaults.

The post Weak Master Passwords Led to the Theft of Millions in Crypto appeared first on PaymentsJournal.

One of Africa’s largest payments processors, Flutterwave, is acquiring API-driven fintech Mono, a move that could reshape how lenders assess creditworthiness in the absence of standardized credit scores.

Mono has made a splash since it was founded five years ago, and its APIs connect a significant portion of Nigeria’s digital banking system. For its part, Flutterwave facilitates domestic and cross-border payments across more than 30 African countries. The acquisition will expand both the reach and the breadth of services offered by the two companies.

This open-banking-based partnership could have particularly meaningful implications in Africa, where consumers lack standardized credit scores. The limited scope of many credit bureaus in these markets means lenders are often forced to rely on banks’ transaction histories to evaluate creditworthiness.

A Critical Juncture

The combined infrastructure of Flutterwave and Mono could improve access to borrowers’ banking data at a critical juncture. According to Mono’s CEO Abdulhamid Hassan, Africa is undergoing a transitional period in which regulators are increasingly promoting lending initiatives that will drive financial inclusion.

These inclusion efforts not only create new opportunities for consumers, but also unlock significant potential for banks and businesses. Research from Galileo found that roughly half of global financial leaders surveyed reported their organizations had lost 10% or more in potential business due to absence of truly inclusive technology.

The Inevitable Adoption

Open banking technology—especially APIs offered by third-party providers—is at the heart of this transformation. Due to the eclectic financial infrastructures across the world, open banking has gained traction at varying rates.

However, the flexibility, security, and inclusion benefits of open banking make its widespread adoption inevitable.

“The idea of having open access via APIs to data and to accounts—that’s not going to go away,” James Wester, Co-Head of Payments at Javelin Strategy & Research told PaymentsJournal. “It may change based upon the way regulations are crafted and the way the market develops, but at its core, that open-banking paradigm where you and I have access to our bank account and to the data—that’s going to continue. Customers want that, small business customers want it, and commercial clients want it.”

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In an era of mobile wallets and instant payments, cash is proving far more resilient than many expected. More than half of U.S. consumers surveyed by Siena University say their use of cash has remained the same—or even increased—over the past five years.

The vast majority of respondents said they had paid with cash in the last 30 days. About 17% described themselves as cashless—people who rarely or never use cash. Nevertheless, 60% of these cashless consumers had still used cash in the past month.

A Sense of Safety

Why are consumers holding onto cash? The most prominent concern is safety. Many consumers say paying with cash better protects their privacy than digital or card payments, while others cite the increased risk of identity theft associated with cards and payment apps.

These attitudes extend to the broader economy. Some 94% of respondents want the U.S. to keep cash available in case national security threats disrupt the electronic payments system, and slightly fewer (85%) say cash is a more resilient option in the face of natural disasters, computer glitches, and grid outages.

Laws Supporting Cash

It’s not surprising that most U.S. consumers want to prevent the country from going cashless. A majority say that all businesses should be required to accept cash, while only about a quarter believe businesses should be free to decide whether to accept cash or not.

These views suggest support for the Payment Choice Act now pending in Congress. The legislation would require most businesses to accept cash for in-person purchases of up to $500—a step that many states and cities have already taken. When Siena survey respondents were told about the Payment Choice Act, 85% said they support requiring most in-person retailers to accept cash.

While consumers want to preserve the option to pay with cash, some businesses have chafed at the requirements adopted by several states.

“Every business owner makes choices when it comes to how best to serve their customers and that includes what payment types to accept, including cash,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research.  “Advocating for laws requiring business owners to accept cash is no different than requiring all restaurants to serve both Coke and Pepsi products.” 

The Ohio legislature is currently considering a compromise version aimed at minimizing that burden on businesses. Known as the Currency Access to Spend Here (CASH) Act, the proposal would require each store to offer at least one cash-accepting register or payment option. Violations would not carry fines or criminal penalties, but customers would have the right to sue retailers that fail to comply.

The post Seeking Security, Consumers Are Not Giving Up on Cash appeared first on PaymentsJournal.

Mobile wallet payments in Australia have grown 23-fold over the past six years, according to the Australian Banking Association. During this digital transformation, concerns have emerged that a significant portion of the population may be left behind.

Alongside the rise of digital wallets, online banking has become the norm in Australia. As a result, the number of bank branches fell by roughly half between 2011 and 2024, and many bank-owned, fee-free ATMs have disappeared.

However, around 1.5 million Australians still rely on cash for around 80% of their transactions. Many in this group are older adults, rural residents, or people with disabilities—raising concerns that these vulnerable populations are increasingly cut off from the digital economy.

Keeping Cash in Play

This type of exclusion is not unique to Australia. In the U.S., approximately 4.5% of households lack access to banking services and continue to rely heavily on cash. This reality prompted the introduction of the Payment Choice Act, a bipartisan legislative effort to keep cash in circulation.

The federal law would require businesses that accept in-person payments at brick-and-mortar locations to accept cash for transactions up to $500. Additionally, retailers would be prohibited from charging cash-paying customers higher prices.

Beyond these stipulations, the bill’s sponsors asserted that the U.S. dollar is the nation’s legal tender, and all U.S. businesses should accept it. 

Taking It a Step Further

A similar law was proposed at the state level in Ohio, including a mandate that merchants accept up to $500 in cash. However, Ohio’s version includes provisions designed to allay the burdens of accepting cash on businesses, such as allowing each store to maintain just one payment terminal register for cash transactions.

Australia is rolling out its own regulations, mandating that all essential service providers accept cash starting January 1, 2026, although small businesses are exempt from this requirement. While these mandates aim to protect consumers, they can be difficult to enforce if a merchant deigns to ignore them.

This is partly why Australia has considered taking further measures. For example, it has been suggested that the federal government could categorize banking as an essential service to ensure more physical banking options, or even establish a publicly owned bank to serve the unbanked population.

The post Amid Digital Payments Surge, Australians Raise Concerns About Cash Access appeared first on PaymentsJournal.

Despite macroeconomic concerns, the holidays are still a priority for consumers. Early data from Visa shows that U.S. holiday retail spending rose 4.2% year-over-year, excluding inflation.

The report is based on payments activity tracked from early November and excludes automotive, gas, and restaurant spending. While in-store purchases still account for nearly three-quarters of holiday spending, e-commerce emerged as the primary driver of growth.

Artificial intelligence also played a role in the online shopping boom. Visa found that roughly half of surveyed consumers said they planned to use AI tools for comparison shopping and to help narrow down gift choices.

“It’s good news that holiday sales are up over 4% and e-commerce sales largely drove that by growing almost 8%,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Certainly, AI is playing a role in this growth by making it easier to search for products with less-defined input.”

“So-called agentic search uses AI to discern meaning and intent from user search requests, rather than just matching on key words,” he said. “Because agentic search can deliver more accurate context-aware results, users are more likely to follow through with purchasing one of the suggested items.”

Picking It Up Today

It’s important to distinguish between agentic search—where AI agents help users discover products or services—and full-fledged agentic commerce.

For example, a recent agentic search partnership between PayPal and AI platform Perplexity allows users to consult an agent and complete purchases within a chat interference, but the final decision remains with the shopper.

This trend is prompting many merchants to rethink their strategies, though it doesn’t diminish the importance of the brick-and-mortar experience.

“While there’s no question that agentic search is giving e-commerce a boost, what’s notable in all of this is that physical retail still accounted for almost 75% of total retail spending this holiday season, according to Visa’s research,” Apgar said. “While agentic search can only discover results on the web, this underscores the importance of omnichannel alignment for retailers.”

“In-store inventory and buying options need to be available for agentic search engines so the consumer still gets meaningful results when they add ‘that I can pick up today’ to the end of their search query,” he said.

The Agentic Holidays

Despite these dynamic shifts, the retail sector is still far from true agentic commerce, in which AI agents independently handle most or all aspects of a transaction with minimal user involvement.

While agentic commerce has yet to gain the same level of adoption as agentic search, Visa expects that to change. The company said it already completed hundreds of AI-driven transactions through trials of its Intelligent Commerce program and anticipates that millions of consumers will rely on AI agents as personal shoppers during next year’s holiday season.

The post Holiday Shopping Soars, Driven by AI and E-Commerce appeared first on PaymentsJournal.

As the holiday shopping season heads into its final phase, last-minute gift cards are expected to fly off the store shelves. This year, shoppers may benefit from a new technology designed to make those cards far more tamper-proof.

Schnuck Markets, a grocery chain in the St. Louis area, recently completed a 10-week pilot program with Digimarc that embedded a tamper-evident digital watermark directly onto its gift cards. The watermark replaces the standard activation barcode, which is typically protected by scratch-off strips or bulky packaging intended to deter theft.

With traditional gift cards, criminals have been able to cover legitimate barcodes with fraudulent ones, causing any funds loaded onto the card to be redirected straight into a criminal’s account. Under the new system, if a watermarked card shows any sign of tampering at checkout, it simply will not activate.

Early results from the pilot are encouraging. There were no reports of fraud involving any of the Digimarc-secured cards, and every gift card in the program was activated successfully.

Streamlined Processes

The new technology did not slow down the checkout process. In fact, 87% of cashiers reported that Digimarc cards activated just as quickly—or faster—than traditional gift cards. Employees also no longer needed to open packaging or visually inspect cards for fraud, a step that can delay checkout. The program required no changes for customers at self-checkout and did not interfere with existing in-store processes.

“From a technology perspective, the added layer of the watermark serves to be a simple and unobtrusive security measure that protects consumers and retailers,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research.

A Concerted Effort

Gift card fraud has long been a concern across the industry, with consumers losing more than $200 million to these schemes last year. Recent packaging improvements have already helped create an environment in which shoppers feel more confident and secure.

“While Javelin research shows that most consumers already feel safe using and buying gift cards, these efforts highlight the proactive approach that the entire prepaid ecosystem is taking to protect balances,” said Hirschfield. “What is most evident is the full-scale cooperation from packaging to program management to retailers and merchants working to solve the problem.”

The post Digital Watermarks Are the Latest Protection for Physical Gift Cards appeared first on PaymentsJournal.

Not long after India’s Unified Payments Interface (UPI) launched a feature enabling users to approve payments with a fingerprint or facial scan, Amazon Pay rolled out its own support for biometric authentication.

Previously, consumers were required to enter a PIN to authorize transactions. Under the new feature, UPI now allows transactions of up to ₹5,000 (approximately $56) to be approved using biometric verification. The functionality is available across a wide range of payment use cases, including peer-to-peer (P2P) payments and merchant transactions.

Amazon Pay highlighted the friction-reducing benefits of biometrics and noted strong early adoption, with over 90% of eligible users opting to use biometric authentication for P2P payments.

The company also emphasized that biometric authentication offers enhanced fraud protection, as credentials are tied to a specific device and cannot be shared. Additionally, facial or fingerprint scans can be performed with one hand, which could help speed up checkout lines  for smaller transactions.

The Rising Role

As more users have become accustomed to using biometric authentication to perform actions on their phones, expectations have grown that biometrics will play a larger role in payments.

However, broader adoption has faced several challenges—most notably, the lack of widely deployed infrastructure to accept biometric payments in many regions. Additionally, consumers must be made aware of these programs and choose to opt in. In markets like the U.S., the dominance of card payments means many users have not recognized a compelling value proposition for adopting biometrics.

All these factors explain why there have been few large-scale implementations of biometrics in payments worldwide, despite a rising number of pilot programs and proof-of-concept projects.

A Global Force

This is why the UPI launch represents a watershed for biometric authentication in payments. UPI processes roughly 20 billion transactions per month, and its owner, the National Payments Corporation of India, handles nearly half of the world’s digital transactions.

The real-time payments system has become a global payments force in just seven years and continues to expand its reach. This rapid growth is one of the reasons Amazon has invested heavily in its Amazon Pay platform in India.

While the wallet currently holds only a fraction of the market share compared with leaders PhonePE and Google Pay, Amazon Pay’s biometric launch is a milestone for real-world biometrics applications that could provide a blueprint for further adoption.

The post Amazon Pay Is One of the First Wallets to Support Biometrics on UPI appeared first on PaymentsJournal.

SoFi is launching its own stablecoin, SoFiUSD, providing open access to its digital asset infrastructure. The offering will allow banks, fintechs, and enterprise partners to leverage SoFi’s operational framework to issue their own white-label stablecoins.

The stablecoin is already in use for internal settlement activities, with a rollout to SoFi members expected in the coming months. According to Decrypt, SoFi will initially launch the stablecoin on the Ethereum blockchain, with plans to expand to multiple blockchains over time for broader accessibility.

A Variety of Use Cases

The initiative gives SoFi’s partners and customers a much easier path to offer their own branded crypto solutions. They can integrate a white-label stablecoin into their settlement and payment flows using the company’s infrastructure. SoFi is targeting the stablecoin for use by card networks, retailers, and other businesses seeking faster, lower-cost payments.

The stablecoin could also enable cross-border and near-instant transactions, improving availability while reducing costs. For companies operating in countries with volatile currencies, SoFi plans to offer the coin as a dollar-denominated asset designed to mitigate currency fluctuations.

Is a Bank Necessary?

Past attempts at introducing white-label stablecoin have largely come from crypto-focused entities, including Paxos and BitGo. Around the same time as SoFi’s announcement, Coinbase launched a white-label service, allowing companies to issue branded stablecoins. For organizations exploring their own stablecoin, a full-service bank can offer a familiar, regulated option with a range of additional services already in place.

“Partners get a branded coin while SoFi provides regulatory, operations and reserves frameworks behind the scenes,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “The low-hanging fruit for this service are payment players like fintechs, PSPs, merchant acquirers, banks and credit unions, and remittance payout-type companies.”

That said, that sense of institutional comfort doesn’t necessarily mean a stronger value proposition for SoFi’s white-label customers.

“They may be more comfortable that way because that’s what they’re used to,” Hugentobler said. “But they’re kind of missing the whole point if they think that’s their first or best option. You don’t need a bank for all of this.”

The post SoFi Unveils White-Label Stablecoin appeared first on PaymentsJournal.

Google Pay is launching a credit card in India, linked to the highly popular Unified Payments Interface (UPI) network. This co-branded card, Flex by Google Pay, could serve as a pilot for further global expansion.  

The digital card is issued through the Google Pay app and can be used both online and in physical stores. It offers a rewards program, tools to monitor spending and bills, and flexible repayment options, including full balance repayment or installment plans.

According to Google, the full rollout will take several months.

“In India, while digital payments have become ubiquitous, transactional credit remains underpenetrated,” said Sharath Bulusu, Senior Director of Product Management at Google Pay in a blog post. “We see an opportunity to simplify and reimagine this experience for the next generation of card users.”

Seeking a New Revenue Source

Google Pay is already widely used in India, having processed about 7.2 billion UPI transactions in October alone, second only to the PhonePe payments app. However, person-to-person payments on the UPI network generate relatively little revenue. Introducing a credit card would provide Google Pay with a substantial new income stream in the Indian market.

Although India has a population of more than 1.4 billion people, fewer than 50 million currently hold a credit card, indicating strong potential for growth in this area.

“It will not take long for the product to scale to one million cardholders in India,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “The Reserve Bank of India (RBI) has taken the lead to democratize credit in that country, with strong efforts to build modern consumer protections, increase competition, and grow digital and consumer payments Mastercard, RuPay, and Visa networks.”

A Dream Market

The Flex card is a partnership with Axis Bank. Google Pay plans to expand Flex to additional banking partners in the future. With more than five billion users engaging with its search functions, Google represents a potentially lucrative market for financial services.

“Google users are a credit card marketer’s dream,” said Riley. “You can bet that if they find success in the Indian subcontinent, they will discover co-brand partners to issue with top banks in their other top markets, which include the United States, Japan, Brazil, and Germany.”

The post Google Pay Launches Its First Credit Card in India appeared first on PaymentsJournal.

PayPal has filed an application for a bank charter to expand and strengthen its lending services to small businesses. The application has been submitted to the Utah Department of Financial Institutions and the FDIC to establish PayPal Bank, which would be chartered in Utah.

To date, PayPal has extended more than $30 billion in loans across roughly 420,000 small business accounts worldwide. To be eligible for these loans, businesses are required to have a PayPal Business account. Historically, however, all lending has been facilitated through third-party banks. While PayPal originated the loans and managed the customer relationship, the actual lending has been conducted by traditional financial institutions such as Wells Fargo, JPMorgan Chase, and Goldman Sachs.

A Lifeline for Small Business

PayPal’s lending practice has long focused on the lower end of the small business market. The minimum revenue requirement for a PayPal Business Loan is $33,300, while the PayPal Working Capital Loan has a minimum of $1,000. According to figures compiled by TechRepublic, nearly 70% of PayPal’s small business loans in 2022 went to low- and middle-income areas.

The company has also concentrated on areas largely abandoned by traditional banks. More than half of their loan value between 2017 and 2022 went to zip codes where 10 or more bank branches had closed, per TechRepublic.

“The overwhelming majority of small business lending is done by non-banks today as a form of factoring on card payments,” said Don Apgar, Director of Merchant Services at Javelin Strategy & Research. “PayPal has visibility into the daily volume of card payments processed by a merchant customer, so it can offer a reasonable loan that is repaid daily as a percentage of card payments from customers. By tying repayment to daily cash flow, the business will never be cash strapped due to a large fixed loan payment during a slow period.”

What’s in it for PayPal?

If the charter is approved, PayPal would expand beyond small business lending to provide interest-bearing savings accounts to its customers as well.

“The question for PayPal is what advantages they expect to get by chartering a bank except for additional compliance requirements,” said Apgar. “A bank charter would enable them to offer bank accounts to these small business customers and expand into other embedded finance products. But that approach didn’t work out for them on the consumer side, and led to the departure of CEO Dan Schulman, who had championed building a complete suite of financial products for consumers on top of their PayPal accounts.”

The post PayPal Seeks Bank Charter to Take Small Business Lending In-House appeared first on PaymentsJournal.

The revised Payments Services Directive (PSD2) was designed to facilitate open banking in the European Union while also providing consumers with protections in the new digital payments paradigm. Although these measures have largely achieved their objectives, the evolving fraud threat has continued to drive losses.

A joint study by the European Banking Authority (EBA) and the European Central Bank (ECB) found that, even though the incidence of fraud in the EU remained stable from 2023 to 2024, the total cost of fraud increased from €3.5 billion in 2023 to €4.2 billion in 2024.

These losses occurred despite the largely successful implementation of the Strong Customer Authentication (SCA) requirements under PSD2 in 2020. The report highlighted that transactions leveraging the protocol were generally less susceptible to fraud than those that did not, especially card payments.

Despite this success, the ECB and EBA noted that fraud has persisted because bad actors have adapted their tactics, either by targeting transactions which occur outside of SCA or by tricking consumers into initiating payments themselves.

Stepping Up Scams

These social engineering techniques are part of a broader trend. As the impacts of fraud have grown, many companies and governments have bolstered fraud defenses and controls to rein in bad actors.

As a result, criminals have turned to scams that target consumers directly. Some of the most common scams involve criminals posing as legitimate entities, such as in fake emails from major retailers asking for urgent account action or phony text messages from government agencies demanding payment for unpaid tolls or fines.

While the primary goal of these messages is to trick users into sending funds, there has also been an increasing incidence where consumers being used as money mules—either willingly or unwittingly—to  move money for nefarious purposes.

Shifting the Focus

This shift in focus to the end user is why fraud has continued to accelerate despite better regulations and defenses.

ECB/EBA’s data underscores this challenge. Even though SCA protocols were adopted just five years ago and have been successful, cybercriminals rapidly shifted their tactics to account for it. This is largely because bad actors don’t have to go through pilot programs or review boards to implement their operations.

For organizations to catch up to these cybercriminals—especially as technology has evolved—they will have to shift their mindset and think outside the box.

The post EU Payments Fraud Rises Despite Effective Authentication Measures appeared first on PaymentsJournal.

With its own stablecoin business gaining momentum, Visa is launching a new advisory service aimed at helping banks, credit unions, and other enterprises implement their own stablecoin strategies.

Housed within Visa Consulting & Analytics, the Stablecoin Advisory Practice will offer training, market analysis, strategy development, use-case sizing, and technical support for organizations looking to explore the use of digital assets. The service’s clients already include Pathward, VyStar Credit Union, and Navy Federal Credit Union.

“Stablecoins may represent an opportunity to enhance speed and lower cost in payments,” Matt Freeman, Senior Vice President at Navy Federal Credit Union, said in a prepared statement. “So with the support of Visa, we are evaluating how this technology could fit into our broader strategy to deliver meaningful value to our 15 million members worldwide.”

Who Benefits?

While the service is being marketed to organizations of all types, it may be best suited for entities that are still exploring the possibility of expanding their cross-border capabilities and business-to-business transactions.

“Small to mid-size financial institutions should benefit the most, especially institutions that are member-focused, cost sensitive, and can benefit from stablecoins’ benefits of reducing payment costs,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “Large FIs will just do their own thing rather than going to a direct competitor, like Mastercard or Visa.

“But at the end of the day, if any size customer is asking themselves: How does this integrate in our existing stack and compliance? Do we build, partner, or buy? Which stablecoin use case is actually worth pursuing? They could benefit from Visa’s experience.”

Visa Jumps into Stablecoins

Visa has aggressively moved into the stablecoin business this year, with annual settlement volume reaching $3.5 billion in the digital asset. Since becoming one of the first major payments networks to pilot stablecoin settlement, Visa now rolled out more than 130 stablecoin-linked card issuing programs across more than 40 countries.

Roughly two months ago, it became the first major payment rail to adopt stablecoins as a means for international transactions, allowing businesses to prefund Visa Direct transactions using stablecoins rather than fiat currency. The payments giant has positioned its stablecoin offering not merely as a convenience, but as a tool to improve liquidity management.

“FIs and banks should take note—stablecoins aren’t just for cross-border payments,” Hugentobler said. “They’re for treasury and cash management, liquidity management, FX operations, and 24/7 settlement. If a financial institution or bank isn’t exploring stablecoin integration at this point, they’re behind the curve.”

The post Visa’s Stablecoin Advisory Practice Aims to Open Up the Market appeared first on PaymentsJournal.

Despite the inroads made by digital wallets and agentic commerce, shoppers still turn to the simplest and most convenient ways to pay. Worldwide, many consumers continue to prefer manned checkout stations over unattended alternatives, and credit or debit cards over digital wallets.  

That’s what a new survey from Australian payments firm TNS found. Across several payment scenarios, simplicity and reliability remained the most important factors for shoppers in the U.S., the UK, and Australia—the three key regions TNS examined. When transactions are simple, customers feel in control.

Nearly half (47.4%) of U.S. respondents said they preferred in-person checkout. By contrast, only 19% preferred an unattended or self-service checkout—despite many retailers continuing to explore and invest in this area. Sentiment for in-person checkout was significant in the UK and Australia as well, with 40% and 53.4% of respondents, respectively, saying they preferred in-person interactions when paying for goods and services. Similarly, far fewer respondents in those regions favored cashierless options.  

Pushing Toward Self-Checkout

While the survey represents just one study, the findings are notable given retailers’ increasing investments in self-checkout and cashierless experiences. Separate data from the Food Industry Association last year found that 44% of grocery store transactions were completed through self-checkout, up from 29% in 2022. Consumers’ stated preferences suggest that many feel pushed into self-service payment processes rather than choosing them willingly.

Ultimately, as TNS’ research shows, it all comes down to creating a streamlined experience. When asked about their biggest frustrations when paying for goods and services, roughly a third of respondents across the U.S., the UK, and Australia said they had no major issues. But among the remaining respondents—largely consistent across regions—several pain points emerged. These included having to sign up or create an account instead of using a guest checkout option, encountering too many steps in the process, lacking preferred payment methods, and experiencing transactions that took too long to complete.

TNS’ data underscores a clear message: innovation only succeeds when it removes friction rather than adds it. Retailers that prioritize simplicity will be well positioned to earn consumer trust.

“Shopping as a guest often comes to post-sale frustration,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “Had I taken the time to build a relationship, I might have received rewards, but even more importantly, I would have been able to return to the site much more easily.”

Cards Are Still No. 1

Consumers aren’t just looking for simplicity at the point of sale—they expect it throughout the entire purchase journey. Whether it’s avoiding unnecessary steps at checkout or preventing post-sale frustrations, shoppers want payments to feel intuitive from start to finish. And that desire for ease and control also extends to the methods they choose when paying.

TNS also asked consumers what payment type they prefer, and unsurprisingly, credit and debit cards still dominate. In fact, nearly 70% of U.S. respondents said they prefer to pay this way. By contrast, fewer than 10% of U.S. respondents said they prefer to pay via a mobile or digital wallet—though interestingly, nearly twice as many UK respondents favored digital wallets compared to those in the U.S. TNS attributes this difference to the relative immaturity of payments technology in the U.S. market.

In the end, consumers are signaling a simple truth. Meaningful progress in payments isn’t about adding more choices, but about making the right ones simple and easy to use.

The post Payments Simplicity Is Still Key for Most Shoppers appeared first on PaymentsJournal.

Most of the buzz around stablecoins has focused on payment acceptance, but payouts are the lifeblood of many businesses. In a major step for the industry, YouTube will now allow creators to receive their payouts in PayPal’s PYUSD stablecoin.

Stablecoins are well-suited to meet the growing demand for faster, more efficient payouts because they provide real-time, secure transactions. Some of the most compelling use cases include marketplaces paying sellers, gig platforms paying workers, online gaming platforms issuing winnings, and insurance companies delivering claim payments.

As the largest video sharing platform in the world, YouTube’s adoption of stablecoin payouts marks an important milestone for digital assets. The option to receive PYUSD payouts is now live for U.S.-based creators earning revenue from the platform.

A Particular Draw

While YouTube’s PYUSD payouts may be limited to stateside creators for now, the strongest benefits of stablecoin payouts will be felt by companies with global reach. International payouts are often costly and slow for the same reasons cross-border payments are challenging today.

For merchants that need to send payouts across many currencies and regions, stablecoins offer an attractive alternative. Funds can be sent directly to a creator’s wallet, a major advantage for gig workers and creators who often face long wait times for traditional payouts. Faster access to earnings can in turn drive loyalty and engagement in the highly competitive gig economy.

Stablecoin payouts are also especially compelling for workers and creators in regions with volatile local currencies, or for underbanked and unbanked individuals who may not have access to traditional financial services but do have access to a digital wallet.

An Established Relationship

With PayPal’s wallet, payout recipients can earn yield on their stablecoins. To drive adoption of PYUSD, PayPal recently introduced a 3.7% interest rate for users who hold the stablecoin in their PayPal or Venmo accounts.

Since launching the stablecoin two years ago, PayPal has made many moves to entrench its stablecoin in a market dominated by Circle and Tether. One of PYUSD’s key differentiators is its tight integration with PayPal’s broader ecosystem. That connection also helped pave the way for YouTube’s decision to enable stablecoin payouts, as the two companies already had an established working relationship.

The post YouTube to Launch PayPal Stablecoin Payouts for Creators appeared first on PaymentsJournal.

Javelin’s 2026 Credit Card Trends report anticipated moderate growth in 2026, and we are pleased to see the credit reporting agency TransUnion share a similar expectation. Their numbers use a different source than the Federal Reserve numbers we use, as they rely on consumer files rather than bank filings. Either way, it is time for a breather in growth.

Pressures on household budgets and inflation are natural growth drivers. When budgets tighten, consumers tend to spend more and shift their purchases from debit to credit. Sure, rewards help drive the move, but when money is tight, consumers have few options.

Peak Growth Was In 2022

According to TransUnion’s numbers, 2020, the COVID year, saw balances actually drop 12.5%, a far cry from the usual MBO metric credit card executives often manage to, which is around 7% to 8%. The number rebounded in 2022, with an 18.5% result in credit card loan books. The number has tempered since then, with 12.6% growth in 2023, 5.7% in 2024, and 4.4% in 2025. The expectation is that 2026 credit card loan growth will be a mere 2.3%.

Why Is Growth Tempering?

Easy enough: Lenders are getting more cautious.

60-day delinquency is starting to bubble. Auto loan 60-day delinquency surged from a low of 0.92% in 2021 to 1.54% in 2025. Late mortgages rose from an uncharacteristic low of 0.82% in 2025 to nearly double, at 1.54%. Credit cards, at the decisive 90-day delinquent metric, more than doubled, going from a 2020 low of 1.30% to 2.56% in 2025.

What This Means

Lenders will be more cautious. Products for top-end borrowers, which Amex addresses with its Platinum card and Chase with its Sapphire, are a strong segment, but the mass market will tighten.

For borrowers, expect tighter lending, more application declinations, and stronger collection policies. Stricter lending policies are appropriate to help consumers regain control of their budgets as unemployment rises and the Fed continues to lower interest rates.

We think the Secured Card will help borrowers at the cusp of good credit score levels, particularly <700 FICO Scores. They will even help borrowers with mid-range scores between 700 and 720 who want to improve their performance. 

You can read about it here in a recent Javelin report: Evolutions in Secured Cards: Not Ready for Traditional Lenders | Javelin.

The post 2026 Will See Lackluster Growth in Credit: Thank Heavens appeared first on PaymentsJournal.

The BRICS group of nations is moving forward with plans for a shared currency for internal trade, potentially launching as early as next year. Last week, the Institute for Economic Strategies of the Russian Academy of Sciences announced a working prototype of a trade currency known as the Unit, structured to be backed by 60% of BRICS national currencies and 40% by physical gold.

The national currency portion is equally weighted among the Brazilian real, Chinese yuan, Indian rupee, Russian ruble, and South African rand, representing the bloc’s five founding members. Now expanded to include 11 nations, BRICS collectively accounts for more than a third of global GDP.

The organization has for some time been exploring the possibility of a payments system that operates independently of the U.S. dollar. The Unit is a key part of the BRICS Cross-Border Payments Initiative (BCBPI), designed as an industry-focused alternative to the Swift cross-border network, which currently functions under U.S. oversight. The group also plans to establish a parallel messaging infrastructure to replace the Swift system used for interbank communication.

The Unit is seen as a crucial step toward reshaping trade relationships among emerging and developing nations. The goal is to begin testing transactions next year involving Brazil, China, and Russia, to refine the efficiency and security of the new currency before its full launch.

Kinks to Iron Out

Despite progress toward creating a formal currency, the initiative still has many kinks that need to be ironed out. The BCBPI was first proposed in 2015, but issues like payment mechanisms, cost-sharing arrangements, and security protocols have slowed the development of a functional cross-border payments framework.

“There isn’t really all that much trade between this group of countries,” said Hugh Thomas, Lead Analyst, Commercial & Enterprise at Javelin Strategy & Research. “The main things they have in common are fast developing economies, save maybe Russia, and a general indifference to the U.S.”

Friendly Competitors

There are also concerns that these economies often compete with one another, especially China and India. This will make collaboration on a common currency inherently challenging.

“You’re talking here about harmonizing two countries’ monetary policies that tend to be geared to drive advantage over one another,” Thomas said. “My expectation is that they will continue to build spot solutions where they can find common cause on use cases and a willing audience, but business’s need for transparent systems in countries with independent regulators and a clear rule of law will keep most big flows on Swift.”

The post BRICS Moves Forward on a Common Currency for Cross-Border appeared first on PaymentsJournal.

Some shoppers have purchased gift cards, loaded the balances, and later discovered that the funds disappeared before the intended recipient ever used them. This scenario is often the result of gift card draining scams, in which bad actors steal gift card data or tamper with cards before returning them to store displays.

Once a consumer activates and loads a compromised cards, a bot alerts the criminals, who immediately drain the funds.

These scams escalated enough to draw the attention of the Department of Homeland Security (DHS) last year. Their investigation revealed that many of these operations are run by large overseas threat actor groups, which have collectively reportedly cost U.S. consumers more than $1 billion over the past two years.

Working to Curtail

Because gift card draining networks pose substantial risks, many organizations have moved to create defenses against this scam.

“These sophisticated crime networks have tried to find a vulnerability in the card supply chain, but it should be noted that industry and regulatory bodies are working to curtail these activities,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research.

“Major brands and their card and security partners have continually strengthened their packaging to show signs of tampering, as well as other security measures—such as to use tamper-evident seals and labels over key card information,” he said.

Gift Card Awareness

Consumer education is a critical part of fraud prevention, and informing customers about gift card scams is especially important as the holiday season approaches. Gift cards have become popular holiday gifts because they give recipients the flexibility to choose something they really want.

To ensure their gift stays secure, consumers can take a few simple steps to protect themselves this season.

“If a consumer is choosing a card off a display and not in tamper-proof packaging, they should browse several cards and ensure that the labels covering the account numbers are identical,” Hirschfield said. “These labels are generally difficult to reproduce if removed.”

Although gift card purchases may require a heightened awareness, the threat shouldn’t be blown out of proportion.

“Consumers should feel safe buying gift cards,” Hirschfield said. “While these crimes do occur and shouldn’t be minimized, Javelin research shows that very few consumers have ever purchased a gift card that was skimmed.”

The post Gift Card Draining Fraud Could Diminish Holiday Cheer appeared first on PaymentsJournal.

Guest checkout at retail websites remains hugely popular—so much so that even shoppers who already have accounts are still more likely to choose the guest option. The next challenge for merchants will be striking the right balance between security and a seamless checkout experience.

Customers, especially younger ones, increasingly resist creating accounts on retail sites. According to research from Experian, just 40% say they’ve opened a new retail account in the past six months.

Among those ages 18 to 24, roughly 20% couldn’t even remember whether they had opened a retail account at all. For many consumers, onboarding has become optional enough that they either don’t bother with it—or streamlined enough that they don’t recall doing it.

Experian’s report cited earlier research from Capterra, which found that 72% of shoppers use guest checkout even when they already have an account. More than half of respondents said they’ll abandon their cart if asked to reenter payment or shipping details. A separate study from the Baymard Institute found that nearly one in five U.S. shoppers will abandon a cart if they are forced to create an account.

Fraud in a Low-Information Environment

Balancing transaction conversion and data security become more complex in guest checkout scenarios, where merchants have limited information to assess risk. The challenge is even more pressing for younger consumers, who not only prefer guest checkout but also show lower trust in traditional authentication methods.

“This becomes a double-edged sword for merchants,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “They want to offer a frictionless guest checkout experience, but at the same time they would rather the consumer create an account so they can store more data about the consumer and their purchases.”

Behavioral analytics offers a way to evaluate fraud risk without requiring a full login, helping maintain streamline checkout flow. It also aligns with Gen Z preferences: according to Experian, roughly three-quarters of Gen Z respondents said they view physical biometrics as the safest security method, followed closely by behavioral biometrics.

Spanning Many Retail Sites

Another emerging solution is the use of third-party services that facilitate guest checkout across multiple retailer sites, like Shopify’s ShopPay and Early Warning Services’ Paze.

“Consumers can store details like shipping address and payment credentials in these accounts,” said Apgar. “Typically, a returning consumer is ID’d via browser cookies. They work across a network of participating merchants, enabling the consumer to use guest checkout each time.”

The post As Guest Checkout Gains Popularity, Merchants Seek to Keep It Secure appeared first on PaymentsJournal.

Although financial institutions are more engaged with digital assets than ever, many remain cautious due to compliance and privacy obligations. In response to the growing need for privacy-focused options, Circle is introducing a new iteration of its signature stablecoin.

USDCx will be issued on the Aleo network, a blockchain designed with privacy in mind. The goal is to support confidential transactions using zero-knowledge proofs.

“The fact that most public blockchains are totally transparent means that anyone can scrape addresses and trace flows, track and cluster wallets, and essentially infer business relationships,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research.

“In the case of Aleo, they don’t mint a new unbacked token,” he said. “It uses USDC held in a contract controlled by Circle as reserves. This is a big step since the tokens can be swapped for one another without the use of a bridge, which eliminates the additional risks associated with that.”

Purpose-Built Solutions

One of the most powerful features of blockchain technology is the transparency it provides. This can be a game changer for use cases like cross-border payments, where the path of a payment is often difficult to trace.

Despite the benefits stablecoins offer, financial institutions require more stringent guardrails. While a public blockchain like Solana could still be the answer, more purpose-built financial services blockchains have emerged.

For example, Google recently unveiled its neutral, global blockchain for the industry, which is designed to an agnostic solution. Additionally, Stripe and Coinbase are among many players that have launched private blockchain alternatives.

A Mainstay at Main Street

These developments follow a surge in institutional interest in crypto and digital assets in recent years. Still, significant hurdles remain before stablecoin transfers can become a mainstream feature at traditional banks.

“No company wants 100% of their flows and positioning visible on chain as a competitive advantage, so this will solve a lot of issues for FIs,” Hugentobler said. “At its core, USDCx is trying to restore the default confidentiality FIs have and are used to in existing account-based systems, but on programmable, interoperable stablecoin rails.”

The post Circle to Launch Privacy-Focused Stablecoin Iteration appeared first on PaymentsJournal.

As consumers move abroad, many still need reliable ways to send money back home. To this end, an integration between Mastercard Move and Tencent’s cross-border payments solution marks a significant step for those sending remittances to China.

The partnership will enable digital remittances to Weixin Pay, the mobile payment platform within China’s Weixin ecosystem. This opens access to cross-border transfers for more than 1.4 billion users of Weixin and WeChat.

Since Mastercard Move currently connects to roughly 10 billion financial services endpoints worldwide, senders can take advantage of a vast global network. Funds can be delivered either to Weixin Pay wallet balances or to bank cards linked to the mobile wallet.

Searching for a Solution

Sending money across borders has traditionally been a convoluted process involving multiple intermediaries, often making it costly and time-consuming.

Many solutions have been proposed to address the pain points of cross-border payments. Digital assets—particularly stablecoins—are frequently highlighted because they can enable immediate, low-cost transactions that settle on secure and transparent blockchains.

However, stablecoins have faced pushback due to their heavy reliance on the U.S. dollar. This is one reason European lawmakers have shown a preference for a central bank digital currency, such as the digital euro, over privately issued stablecoins. What’s more, there are concerns that the rise of stablecoins has weakened some emerging market currencies, as users often prefer the relative stability of the U.S. dollar over their domestic currency.

The Market Remains Fragmented

All these issues mean that an overarching, global payment type is unlikely to emerge anytime soon. Instead, more solutions have taken the approach of interlinking domestic payments systems. For example, PayPal recently launched its cross-border payments arm, which connects with both WeChat Pay and India’s Unified Payment Interface (UPI).

Mastercard Move, along with Visa Direct, have also forged significant connections with many financial institutions and platforms across their ever-expanding networks. These platforms function as a supercharged version of the correspondent banking system, where banks can perform nearly real-time, secure, and transparent cross-border payments.

While connecting local digital payment systems is an important step toward improving cross-border remittances and payments, the market remains fragmented. For instance, the Mastercard Move and Tencent integration is notable, but WeChat Pay represents around half of China’s market; the other half is dominated by Ant Group’s Alipay.

The post Mastercard Links with Tencent for Cross-Border Remittances in China appeared first on PaymentsJournal.

Fintechs play a pivotal role in the financial services landscape, yet many existing regulatory frameworks were not designed with them in mind. For this reason, the UK is set to launch a licensing program aimed at reducing the red tape that has hindered many fintechs.

Under this program, financial services companies will be able to conduct certain regulated activities under a provisional license for up to 18 months while they working toward full authorization.

The new framework responds to criticism from UK fintechs over the time and expense required to secure a full license. At the same time, easing these requirements is part of a broader initiative by UK regulators to boost economic growth.

Expanding Fintech Access

Calls for better regulation of disruptive financial technologies aren’t relegated to the UK. U.S. Federal Reserve Governor Christopher Waller recently posited that payment services companies should be able to obtain a limited account with the Fed.

Traditionally, master accounts that access Federal Reserve services have been restricted to licensed banks. However, Waller’s proposed “skinny” master account could allow fintechs to access these services directly. This could eliminate a pain point for many U.S. fintechs that currently rely on licensed banks’ master accounts to conduct their payment services.

A Growing Acknowledgement

These regulatory proposals and initiatives reflect a growing recognition among regulators worldwide that fintechs are critical to the modern financial services industry. Third-party financial service providers are the building blocks of the open banking system, which is gaining global traction.

These fintechs enable customers to control their data while allowing financial institutions to deliver innovative products. While open banking has achieved faster adoption in the UK than in the U.S., the model is steadily advancing worldwide.

“The idea of having open access via APIs to data and to accounts—that’s not going to go away,” James Wester, Co-Head of Payments at Javelin Strategy & Research told PaymentsJournal. “It may change based upon the way regulations are crafted and the way the market develops, but at its core, that open-banking paradigm where you and I have access to our bank account and to the data—that’s going to continue. Customers want that, small business customers want it, and commercial clients want it.”

The post UK to Launch Fast-Track Licensing for Fintechs appeared first on PaymentsJournal.

An investigation into a single fraudulent website has escalated into a multi-jurisdictional initiative to take down a crypto fraud network that has allegedly laundered more than €700 million (roughly $816 million).

According to Europol, the criminal organization operated a series of phony cryptocurrency investment platforms, luring thousands of victims with false advertising that promised unusually high returns.

Once individuals engaged with these websites, they were relentlessly contacted by organized criminal call centers and pressured into investing through aggressive social engineering techniques. After victims transferred their crypto, the funds were stolen and laundered across multiple platforms.

While investment scams have long been a staple of criminal enterprises, the sophistication of this particular fraud ring reflects a troubling evolution—one that demands a new, more adaptive response.

“This criminal network takedown shows why collaboration is so critical,” said Jennifer Pitt, Senior Fraud Management Analyst at Javelin Strategy & Research. “Fraudsters often rely on cryptocurrency because they believe it is untraceable, but blockchain creates an audit trail that supports investigations and helps identify the entities involved.”

“Transactions move quickly, so law enforcement must act quickly and act together to freeze funds before they disappear,” she said. “It is also important to target both the operators behind fraudulent cryptocurrency platforms and the companies using aggressive and deceptive marketing to reach victims.”

Any Means Available

While fake crypto investments were the initial driver of this scam, cybercriminals will exploit any available channel to reach potential victims. For example, Google recently highlighted a group of threat actors known as the Smishing Triad that have developed a phishing-as-a-service toolkit used to create and deploy text message scams.

These messages impersonate urgent notifications from organizations like E-ZPass, the U.S. Postal Service, and Google. When users clicked the links, they were directed to phony websites engineered to steal personal and financial information.

Calling for a Global Response

The threat is compounded by the scale and coordination of organized fraud rings. In response to the widespread impact of these attacks, many organizations are searching for new strategies to combat the growing fraud epidemic. Google has even gone so far as to file a lawsuit against the Smishing Triad due to the extensive harm the group has allegedly caused.

While fraud attacks have far-reaching ramifications for consumers and businesses, networks such as the one European authorities uncovered are often tied to a broad array of other criminal activities.

“This case also highlights the connection between fraud and money laundering and why unified FRAML (Fraud Detection and Anti-Money Laundering) teams are necessary,” Pitt said. “When everyone uses the same data and systems, they can see the entire picture rather than isolated pieces. This is a global problem, with criminals coordinating across borders. The response needs to be global as well.”

The post European Authorities Uncover Crypto Investment Scam Syndicate appeared first on PaymentsJournal.

The traditional fleet management model has relied heavily on physical payment cards, which can be lost, stolen, or misused. An emerging alternative is vehicle-initiated payments, a technology in which one of the leading providers, Car IQ, is set to be acquired by Element Fleet Management.

In Car IQ’s model, vehicles can autonomously initiate and complete transactions. This reduces reliance on physical cards and streamlines many of the manual reconciliation processes associated with them.

Element, a large-scale provider of fleet management solutions with existing digital payments capabilities, plans to integrate Car IQ’s technology into its broader ecosystem. With the acquisition, vehicle-initiated payments are expected to become a standard component of the company’s fleet management ecosystem.

“This is a play to expand the payments capabilities for Element as well as the ability to leverage the partnerships that Car IQ has made among fuel and tolling agencies,” said Ben Danner, Senior Credit and Commercial Analyst at Javelin Strategy & Research. “The technology and the back-office simplification that Car IQ has perfected will be a valuable asset to Element.”

“What remains to be seen is what Element does with its current fuel card product on the WEX network. Will they keep it or go fully cardless?” he said.

Frustrated With Fragmentation

There are substantial benefits to moving away from physical cards, as lost or misused cards often create a significant financial drain for companies managing large-scale fleets.

These inefficiencies also affect drivers. Recent data from Visa shows that roughly two-thirds of drivers are frustrated with the complexity of their existing payment solutions, and 84% are unhappy with fragmented systems.

Mitigating Pain Points

The pain points associated with physical cards have led many companies to explore virtual cards, which can be issued and loaded directly into a driver’s digital wallet. Virtual cards are gaining traction across many business-to-business use cases because they enable faster, more efficient transactions and provide stronger guardrails.

For example, a virtual card can be issued as a one-time payment for a single driver on a specific day, while still giving fleet managers the flexibility to issue chargebacks if conditions aren’t met.

While virtual cards are a strong option, embedding payment capabilities directly into vehicles may be even more appealing for some fleet managers. Linking payments to the vehicle itself can help mitigate misuse and streamline fleet management processes that are otherwise manual and inefficient.

The post Element’s Car IQ Acquisition Could Broaden the Scope of Vehicle-Initiated Payments appeared first on PaymentsJournal.

Apple has now brought its contactless payments platform to its 50th market, marking a major milestone in the company’s global push to turn the smartphone into a full-service point-of-sale terminal. Accepting payments on a phone has become a critical lifeline for small businesses and independent workers—from gig drivers to creators.

Apple has long targeted this segment with its tap-to-pay platform, and the service is now available in Singapore. The technology, sometimes called tap-to-phone, allows merchants to accept contactless payments directly on their devices through both digital wallets and physical cards. In the past, small business owners typically needed to purchase or rent a dedicated POS terminal for the same functionality.

“It’s great that Apple continues to expand the available footprint for tap-to-phone,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “While POS platforms like Square and Clover continue to expand in small storefronts, tap-to-phone brings that same level of efficiency in embedded payments to merchants that don’t operate from a storefront.”

“This key market includes field service providers like tradespeople, and individuals in the creator and gig economies that need a fast, secure way to accept cashless payments from customers,” he said.

Expanding Worldwide

The rollout comes amid a surge of tap-to-pay solutions, a trend accelerated by Apple’s decision to open its NFC technology to third-party developers. That shift has thrust the tech giant deeper into a crowded small business POS market that once dominated by Square dongles.

Apple launched the service in eight countries earlier this year: Belgium, Croatia, Cyprus, Denmark, Greece, Iceland, Luxembourg, and Malta. And its arrival in Singapore brings the total to 50 countries and regions.

As in other markets, Apple has strived to make sure its platform is compatible with major domestic payment methods. In Singapore, the platform will support payment Adyen, Fiuu, HitPay, and Revolut, as well as cards issued by Visa and Mastercard, among others.

Banking on Ubiquity

Despite this rapid proliferation, small business owners now have more options than ever. Many small business payment terminals, including models from Clover and Square, closely resemble smartphones, but these devices are still largely designed for merchants with employees.

Visa also offers a tap-to-phone solution, which has experienced a threefold increase in adoption over the past year. While Visa may have a more developed payments infrastructure, the near-ubiquity of the iPhone may give Apple an advantage in this market.

The post Apple Expands Contactless Payments to Singapore appeared first on PaymentsJournal.

As buy now, pay later services become more widely used, Democratic officials at both the federal and state levels are pushing for stronger oversight—filling the gap once covered by the Consumer Financial Protection Bureau.

Seven Democratic senators have sent letters to major BNPL providers, seeking detailed information on their lending practices and urging them to report relevant data to credit agencies. Similarly, seven Democratic state attorneys general have requested explanations of how BNPL companies evaluate a consumer’s ability to repay, along with details on billing practices, late fees, and dispute procedures.

Their concern is that BNPL users may already be financially overextended when they on additional loans. One letter to Klarna, for example, cites data showing that consumers with a BNPL loan carried, on average, $871 more in credit card debt during the month of origination than comparable consumers who did not use BNPL.

Seeking More Disclosure

Under the Biden administration, the CFPB proposed applying the Truth in Lending Act to BNPL companies, which would make them subject to the same disclosure requirements as credit card issuers. The Trump administration rescinded that rule earlier this year.

Some BNPL providers are already doing at least part of what lawmakers are requesting. Affirm took the lead in providing data to credit bureaus earlier this year. A joint study between Affirm and Experian found that the effects of BNPL on credit scores were negligible overall—and when there were impacts, they were often positive.

“Providing the necessary data and demonstrating that their practices are just another credit option that isn’t causing significant financial harm to consumers could garner favor from regulators,” said Ben Danner, Senior Credit and Commercial Analyst at Javelin Strategy & Research. “But it’s a gamble of how one will interpret the data. If one goes into the analysis with an expectation that BNPL is already causing significant harm, I’d expect them to leave with that conclusion.”

Growing in Popularity

The investigation comes as BNPL continues to grow in popularity. As noted by the lawmakers, half of all U.S. consumers have used BNPL plans, and about a quarter of BNPL users have had three or more such loans at the same time.

According to the consumer analytics firm CivicScience, 38% of shoppers used BNPL services over the recent Black Friday weekend, with most of those users being younger and lower-income consumers.

The post Democratic Lawmakers Drill Down on BNPL Practices appeared first on PaymentsJournal.

Through its banking arm, Sony plans to launch a U.S. dollar-backed stablecoin that could play a significant role in the company’s gaming and entertainment ecosystem.

This launch represents one of the few direct USD stablecoin initiatives by a Japanese company and is being facilitated through a partnership with digital assets firm Bastion. The U.S.-based firm will oversee stablecoin issuance, reserve management, and custody, while Sony Bank will support stablecoin services across Sony’s network of affiliates.

The stablecoin could debut as early 2026, with plans to integrate the token into Sony’s gaming, streaming, and anime platforms. The move would give users an alternative to credit cards for subscriptions, in-game purchases, and digital content.

Significant Bottom-Line Impacts

Reducing credit card payments would also minimize the substantial transaction fees that Sony currently incurs. What’s more, stablecoin payments could mitigate the costs and processing delays that have long plagued cross-border transactions. This could have significant impact on the bottom line, as roughly a third of Sony’s global revenue originates from the United States.

A similar rationale was cited by Klarna when it unveiled its stablecoin, KlarnaUSD. Since cross-border transactions generate more than $120 billion in annual fees, Klarna noted that a stablecoin would allow it to move money far more efficiently than under the current system.

Validating the Narrative

The instant settlement and minimal volatility of stablecoins have driven a flood of new launches in recent months. As many of the largest financial players release their own iterations, other companies have followed suit—including potentially Walmart and Amazon.

While Klarna has historically taken an unabashedly standoffish approach to crypto and digital assets, Sony has been far more active in the space. After last year’s launch of its Soneium layer-2 blockchain, the company collaborated with stablecoin leader Circle to make the USDC stablecoin a primary token on the blockchain. However, it’s unclear how Sony’s new stablecoin will interact with Soneium, if at all.

Still, Sony’s launch reflects the broader surge in confidence that stablecoins have enjoyed since the GENIUS Act was proposed and passed. That framework also established new compliance requirements for stablecoin issuers. To support its stablecoin, Sony Bank has applied for a U.S. banking license and may establish a branch to manage issuance and regulatory oversight.

Compliance, however, is only one challenge facing Sony’s stablecoin as it enters an extremely crowded market.

“I think this could have a lot of promise in the longer run, but it has a lot of headwinds to gain traction—like liquidity, user adoption, and user experience (UX) is a big part of it,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “Sony jumping in validates the stablecoin narrative as going mainstream, but just because they’re launching a stablecoin product doesn’t mean they’re out of the woods quite yet.”

The post Sony to Launch Stablecoin Aimed at U.S. Gaming Market appeared first on PaymentsJournal.

A record-setting Black Friday was fueled by a sharp rise in consumers using agentic AI, which steered shoppers toward both sale items and higher-end products.

According to Adobe Analytics, which tracks more than one trillion visits to U.S. retail websites, consumers spent $11.8 billion online on Black Friday, up from $10.8 billion in 2024. Between 10 a.m. and 2 p.m., online shoppers were reportedly spending $12.5 million every minute.

Adobe also noted that AI-driven visits to shopping sites rose more than 800% from last year. Consumers weren’t just using AI tools to find deals and compare products—shoppers who arrived on a site via an AI assistant were 38% more likely to complete a purchase.

Separate data from Salesforce estimated that AI assistants and digital agents contributed $14.2 billion of the $79 billion spent online worldwide on Black Friday. Of that, about $3 billion was spent in the U.S.

Altogether, these numbers reflect the accelerating shift toward online holiday shopping. According to Mastercard SpendingPulse, U.S. retail sales on Black Friday rose 10.4% for online purchases but just 1.7% for in-store sales. 

Focus on Specific Stores

One of the most significant ways consumers are using new AI shopping tools is to uncover the biggest discounts. AI tools from Walmart and Amazon focus on making it easier for shoppers to seek out sales items with minimal effort. According to Christopher Miller, Lead Analyst of Emerging Payments at Javelin Strategy & Research, agentic AI may ultimately have the biggest impact on retailers that integrate these tools directly into their purchasing experience.

“The delivery of these artificial intelligence tools could come from a few stores, like Amazon and Walmart and Target,” Miller said. “It is unlikely that some single tool will actually know everything about you, will be able to handle all of the types of choices that you would have, and would actually be good at it.”

More Discounts, More Luxury Items

Whether shoppers relied on AI to guide their holiday buying or simply used traditional methods, it’s clear they were hunting for deals—and in many cases, willing to splurge. According to Adobe, several categories saw unusually steep Black Friday markdowns. Toy discounts peaked at 30% off list price, with electronics and apparel seeing similar reductions.

Adobe also reported that consumers are spending more on high-end items this season. AI isn’t just helping people find the best price—it’s helping them determine the best value. The share of units sold surged in premium categories, with electronics and sporting goods both rising more than 50%.

The post Agentic AI Turned a Corner on Black Friday appeared first on PaymentsJournal.

The FBI Internet Crime Complaint Center has received more than 5,000 consumer complaints about account takeover (ATO) fraud already this year, totaling more than $250 million. The news came in an FBI warning about several new ATO scams consumers should be vigilant about.

In ATO fraud, criminals usually gain unauthorized access to a targeted online financial institution. Although many people connect ATO fraud to bank accounts, every type of account is at risk. A fraudster taking over an email account or a social media account can be dangerous as well.

Hacking into Multiple Accounts

The goal for the criminals is not just stealing money but also leveraging additional information to do greater damage.

“If I only know your username and password, when I log into your financial account, maybe now I can see your email address and your phone number,” said Jennifer Pitt, Senior Analyst in Fraud Management at Javelin Strategy & Research. “Banks need to get out of the thinking that it’s solely financial accounts that are being taken over and one account. They’re after as many accounts as they can access, as quickly as they can.”

The FBI warning included advice for avoiding account takeovers through social media. Sharing certain information–like a pet’s name, date of birth, or information about family members—can give scammers dangerous insight into a user’s password or answers to security questions.

New Trends in Scams

The scams have gotten sophisticated enough that even phone calls that seem to be from a customer’s own bank are not reliable. The FBI recommends that people be suspicious of unknown “banking” employees making unsolicited phone calls. Rather than trust caller ID, the FBI says consumers should hang up, verify the correct number, and call it themselves.

The FBI report also cited a relatively new technique called search engine optimization (SEO) poisoning, in which cyber criminals buy online ads that make them look like legitimate businesses. When users click on the fraudulent ad, they are directed to a phishing site that mimics a real website and tricks them into providing their login information.

To avoid this, the FBI recommends that users not click directly on Internet search results or advertisements. Instead, rely on bookmarks or browser favorites to navigate to websites. And always carefully examine any email address or URL that was sent in an unsolicited email or text.

The post FBI Warning Highlights New Account Takeover Scams appeared first on PaymentsJournal.

A proposal requiring retailers to accept cash for purchases up to $500 is moving through the Ohio legislature. While much of the debate has focused on how this would affect retailers— especially those relying on self-checkout—the bill is designed to make compliance as seamless as possible.

The measure mirrors a bipartisan federal effort introduced last July that would require retailers nationwide to accept up to $500 in cash. Several states have already adopted similar laws, but Ohio’s version includes additional provisions aimed at minimizing the burden on businesses.

The bill’s sponsor, David Thomas, says the law is intended to ensure “all Ohioans have the ability to use cash” while also accommodating retailers’ operational needs. Notably, the proposal requires only one cash-accepting register or payment option per store.

The bill would also prohibit charging cash-paying customers more than those using digital or card payments. This could be a shift for many retailers that currently impose higher prices on credit card transactions to cover the interchange fees.

The Rise of Self-Checkout

The initiative appears to be fueled in part by the rise of self-checkout lanes, which offer advantages for both shoppers and retailers.

“I’ve not heard any rumblings about retailers not wanting to take cash at all, but you can see it coming,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Self-checkout stations that don’t have to accept cash and dispense change are less expensive than card-only machines and require much less maintenance.”

Under the proposal, violations by retailers would not result in fines or criminal penalties. Instead, they would be classified as unfair or deceptive practices, giving customers the right to sue.

Other states that have enacted similar legislation have found enforcement challenging. When Colorado Governor Jared Polis signed the state’s bill into law in 2021, he warned that the measure would be difficult to enforce. An investigative reporter in Denver later found no evidence of Colorado businesses being penalized for violations.

Serving the Unbanked

The 2023 FDIC National Survey of Unbanked and Underbanked Households found that 4.2% of Ohio households don’t have a bank account, and nearly one in five have limited access to mainstream credit.

“I don’t think you will ever see big box retailers ever go completely cash free,” said Apgar. “That’s for one reason: the nation’s 25 million unbanked consumers.”

The post Ohio Cash-Only Law Would Carve Out Protections for Retailers appeared first on PaymentsJournal.

After highlighting the ongoing challenges in cross-border payments, the European Central Bank (ECB) is taking steps to link its instant payments system with India’s Unified Payments Interface (UPI).

This integration was first proposed months ago, and after positive results from an exploratory study last month, the ECB is now moving forward with the realization phase to interconnect the Eurosystem’s TARGET Instant Payment Settlement (TIPS) service with India’s payments giant.

The ECB is also exploring the possibility of linking TIPS with Nexus Global Payments—a network born from Project Nexus, an initiative established by central bank consortium Bank for International Settlements (BIS). Nexus Global Payments connects payments systems across South and Southeast Asia, including India, Malaysia, Thailand, Singapore, and the Philippines.

These connections, along with a potential integration with Swiss National Bank’s Swiss Interbank Clearing Instant Payments (SIC IP) system, are part of an overarching strategy to simplify cross-border payments and remittances for European consumers and businesses.

Falling Short of Goals

Earlier this year, a member of the ECB’s executive board underscored the high costs of cross-border payments in the region, even as IT and telecommunications expenses have declined.

For example, a small business owner needing to send a payment to a supplier outside the EU’s Single Euro Payments Area (SEPA) often faces costs roughly 10 to 12 times higher than payments made within SEPA.

Separately, a progress report from the Financial Stability Board (FSB) found that G20 nations have fallen short of achieving the goals they set for improving cross-border payments. The FSB cited challenges including the complexity of coordinating payments across countries and the limitations of legacy payment infrastructure.

Staying at the Forefront

As more real-time payments systems have emerged, interlinking these systems could offer a powerful solution. This approach would reduce costs, increase speed and visibility, and prevent payment service providers from having to engage with multiple payment systems or a series of correspondent banks.

Other solutions for cross-border payments have also been proposed, including networks established by SWIFT, Visa, and Mastercard. Stablecoins have been suggested as another option, though there has been some pushback in the EU because these tokens are largely backed by U.S. dollars.

Conversely, integrating TIPS with a system like UPI could help maintain the euro’s prominence in international transactions. UPI handles the largest real-time payment transaction volumes globally, and India is among the top 10 recipients of euro remittances.

The post EU Plans to Link Its Real-Time Payments System with UPI appeared first on PaymentsJournal.

The launch of agentic commerce platforms like Mastercard’s Agent Pay represents a new phase in how artificial intelligence is integrated into the shopping experience. Still, agentic commerce is far from ubiquitous, and Mastercard is now moving forward with plans to pilot Agent Pay in the UAE.

These platforms aim to give users an AI agent that acts as a personal shopper. With minimal input, the agents are designed to handle the entire shopping process—from product selection to completing the transaction.

Agent Pay’s UAE trial will be conducted in partnership with Majid Al Futtaim, a corporation that owns shopping malls, hotels, and various retail stores across the region. One of the initial use cases being explored is using Agent Pay to shop for and purchase movie tickets at VOX Cinemas.

Choosing the Right Ticket

Although these platforms unlock powerful use cases, questions remain about how effectively AI agents can perform these tasks.

For example, if a user wants to purchase movie tickets, how specific must their instructions be for the AI agent to fulfill the request to their satisfaction? If customers need to provide strict guidance on the film and showtime, the AI agent’s value may be limited.

Conversely, many users may be uncomfortable giving AI full autonomy to select and purchase their evening’s entertainment. This could lead to a surge in disputes if customers are unhappy with the AI’s choices.

What’s more, there are still concerns about the security of agentic commerce transactions and the protocols needed to prevent fraud and misuse.

Not a Novelty

All of these factors contribute to the obstacles agentic commerce faces in achieving broader acceptance. While many users are open to AI-assisted shopping, they often want the final say before a payment is made.

Despite these lingering questions, many of the largest financial services players have invested heavily in the infrastructure to facilitate this new paradigm. For example, both Visa and Google have launched protocols designed to establish guardrails around AI agents.

This investment, combined with the promise of agentic AI, indicates that organizations can’t discount agentic commerce as a novelty. While there may be no need to rush adoption, companies should consider how this disruptive technology could shape their operations.

The post Mastercard Expands Agentic Commerce Efforts to UAE appeared first on PaymentsJournal.

Much has been made of the potential efficiencies that stablecoins and other cryptocurrencies could bring to cross-border payments, but Brazil’s government also believes their use creates a tax loophole.

According to Reuters, Brazil’s ‌Finance Ministry is considering expanding the scope of its financial transaction tax to include certain cross-border payments made with digital assets. Under rules taking effect in February, Brazil classified stablecoin transfers as foreign exchange transactions. This classification also applies to international payments made with digital assets as well as  transfers to and from self-custody wallets.

Although capital gains from crypto trades above prescribed limits have been taxable in Brazil, crypto-based payments have not. Officials say this gap has opened the door for digital assets to be used in nefarious activities like money laundering. There are also concerns that some organizations may use cryptocurrencies to falsify the amounts they declare for import taxes.

“I think money laundering is a bit of an over-exaggeration here–I think it mainly pertains to businesses and B2B or B2C payments,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “I’m sure at the end of the day who the government is actually targeting is these businesses who aren’t laundering money, but they may be underreporting these numbers.”

A Demonstrable Boost

While these concerns likely have merit, taxing crypto transactions could also provide a demonstrable revenue boost for Brazil. The nation’s crypto market has surged ⁠in recent years, driven in large part by increased stablecoin usage.

Tax data shows that crypto transactions reached 227 billion reais (‍roughly $42.8 billion) in the first half of 2025, a 20% year-over-year gain. Tether’s USDT stablecoin accounts for approximately two-thirds of that volume, while bitcoin represents around 11% ​of the transactions.

“It’s a double-edged sword,” Hugentobler said. “The industry needs regulations to grow adoption and use cases, but if regulations are too strict, businesses and other users could revert back to traditional methods. I think this is a long ways away from that, but if they stifle use from too strict regulations it will negate the revenue side of the equation. If companies treat these payment options like any other payment options, they have nothing to worry about.”

Increasing Financial Inclusion

In addition to cross-border payments efficiency, stablecoins have gained ground in many regions because they markedly increase financial inclusion. In areas with currency instability, leading U.S. dollar-backed stablecoins like USDT and Circle’s USDC can offer a more reliable alternative.

This reliability has made stablecoins far more viable for payments than cryptocurrencies such as bitcoin or Ether. This sentiment was echoed by Brazil’s central bank, which found that stablecoins were largely used in the region as an inexpensive way to hold and spend USD.

Central bank officials believe that taxing these transactions would provide greater visibility into digital asset usage and help mitigate misuse. However, the proposal still requires approval from Brazil’s federal tax authority.

“Brazil is one of the world’s largest stablecoin markets by transaction volume, so this could become a live case study for stablecoins with FX-type regulations where others follow suit,” Hugentobler said. “But the fact that Brazil’s government is releasing regulations around stablecoins means it is accepting them, which is a step in the right direction overall. Whether or not growth or volumes decrease in the short term is yet to be seen, but I think as long as businesses and other users adhere to the regulation and fees aren’t too steep, it should be good for growth in the longer term.”

The post Brazil Considers Taxing Crypto Cross-Border Payments appeared first on PaymentsJournal.

JPMorgan Chase has decided to shut down its VW Pay division, formally known as the J.P. Morgan Mobility Payments Solution. The Luxembourg-based unit struggled to achieve profitability in the once-promising field of automotive payments, which enables customers to make digital payments for fuel, parking, and other internet-connected services.

JPMorgan will continue providing mobility services to its existing customers, but the operation will be folded into other divisions. The business was founded by Volkswagen in 2017 and acquired by JPMorgan four years later.

Customers Hard to Find

At the time, JPMorgan saw an opportunity in in-car payments and expected the segment to take off. But the market never fully developed—largely because additional automakers and parts manufacturers, beyond VW, would have needed to integrate closely with Mobile Payments Solutions.

“When Volkswagen started this division to explore in-car payments, JPMorgan jumped in and bought it as a strategic investment they wanted to scale,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “The idea is that cars could be equipped with payment transponders and could automatically make purchases at gas pumps, charging stations, and drive-thrus. The tech was there, but making it usable required a ton of integration work with the providers who the car companies would buy from. So you have a long strategic cycle, but what killed it was the revenue model, or more specifically the lack of one.” 

Losses Pile Up

Volkswagen Group and its associated brands remained the primary customers, though it onboarded eight merchant clients last year. Despite that progress, the unit posted a €28.8 million loss in 2024.

“JPMorgan invested heavily in the development and integration, but how do they make money on it?” Apgar said. “Automakers could charge for the hardware as part of an option package. But in terms of ongoing revenue, initial thoughts were that consumers may pay a fee for the convenience of embedding payments within their car.”

Another setback was the pandemic, which accelerated the adoption of contactless payment options, reducing the need for in-car payment solutions.

“I go back to the old adage,” Apgar said. “Not everything that can be built should be built.”

The post JPMorgan’s In-Car Payments Unit Takes the Exit Ramp appeared first on PaymentsJournal.

With the holiday shopping season already underway, many gift givers may be enticed by the promise of deferred-interest financing. Although buy now, pay later options have stolen much of the spotlight from this older model—once popular when shoppers were as likely to have a store card as a general-purpose credit card—a handful of card issuers and a wider range of retailers still promote these plans. Their days, however, may be numbered.

Under these arrangements, retailers offer zero-interest introductory periods but then apply interest retroactively if the buyer misses a payment or fails to pay off the balance before the promo period ends. When that happens, the regular interest rate is applied to the entire original purchase amount, effectively erasing any benefit of the introductory offer.

What makes these plans even riskier, according to a deferred interest study from WalletHub, is that stores are not always transparent about how they work. And because store cards often carry exceptionally high interest rates, shoppers can end up paying as much as 35.99% at retailers like Michael’s and Kay Jewelers. In many cases, retailers disclose these APRs only in fine print or in places customers are unlikely to notice.

Private Labels Are Disappearing

Consumers are catching on. According to WalletHub, roughly half of respondents say deferred-interest plans should be outlawed—and, in what’s likely a related finding, roughly the same share admits they don’t fully understand how these plans work.

How long can these offerings hold on? Store cards that once promoted them as introductory perks have lost much of their appeal, with usage steadily declining over the past two decades, according to Javelin Strategy & Research.

“Deferred interest plans have been typically attached as promotional deals to private label credit cards,” said Ben Danner, Senior Analyst of Credit and Commercial at Javelin Strategy & Research. “There, the model still has relevance for acquisition at the point of sale, usually through signage or store clerks recommending the financing option.”

Many Other Options

Shoppers now have plenty of options when choosing how to pay. BNPL plans also let consumers delay payments, but without the risk of steep interest charges suddenly popping up a few months down the line.

“The main threat that has taken share of traditional deferred interest programs has been BNPL, which offers similar 0% terms although paid in installments for a fixed period of time,” said Danner. “For this holiday season, expect to see a plethora of financing options at the POS.”

The post In the Era of BNPL, Deferred Interest Offers Hang On appeared first on PaymentsJournal.

Cybercriminals are expanding their playbook. While email and text remain common phishing channels LinkedIn messages are quickly gaining traction as a new favorite target.

According to The Hacker News, LinkedIn has become an appealing target because many professionals—including company executives—access the platform on corporate devices. At the same time, many organizations haven’t put the same safeguards in place to identify and intercept fraudulent LinkedIn messages as they have for email.

“Social media accounts, including LinkedIn, are increasingly being used by cybercriminals to target employees, consumers, and executives,” said Tracy Goldberg, Director of Cybersecurity at Javelin Strategy & Research. “Beyond the lacking multi-factor authentication (MFA) noted in the article, social media channels give consumers false senses of security, because consumers inherently trust communications that come through social media.”

“Add to that the increasing sophistication of infostealers—which readily compromise credentials for account access by scraping and capturing browsing histories and stored cookies—and consumers are at ever-increasing risk of being manipulated by socially engineered attacks like phishing that prey on their psychological vulnerabilities,” she said.

A Launchpad for Campaigns

Infostealers are a powerful class of malware capable of extracting sensitive data from online sources at an alarming scale. Some experts attribute of billions of stolen personal credentials to these tools, driven in part by the vulnerabilities inherent in social media platforms.

“It’s incredibly easy to just take over legitimate accounts,” Goldberg said. “Some 60% of credentials in infostealer logs are linked to social media accounts, many of which lack MFA—because MFA adoption is far lower on nominally ‘personal’ apps where users aren’t encouraged to add MFA by their employer. This gives attackers a credible launchpad for their campaigns, slotting into an account’s existing network and exploiting that trust.”

Expanding the Scope

Although individuals are often the initial targets of LinkedIn phishing campaigns, the ultimate objective is typically to gain access to a larger organization—especially those with extensive cloud infrastructure.

Once an initial foothold is established, cybercriminals can infiltrate company systems to steal protected data for financial gain or launch ransomware attacks against the organization.

Given the rising costs associated with a single breach, organizations should broaden their phishing training and defensive strategies to specifically account for LinkedIn and other social media platforms.

The post LinkedIn Messages Are a Popular Protocol for Phishing Attacks appeared first on PaymentsJournal.

Alibaba is gearing up to supercharge its vast business-to-business ecosystem by tapping JPMorgan’s tokenization infrastructure, laying the groundwork for a new kind of cross-border value network.

The network will center on tokenized fiat currencies that function similarly to stablecoins. According to CBNC, Alibaba is already experimenting with tokenized U.S. dollars and euros, with plans to support additional currencies over time.

Alibaba expects to launch the network by the end of the year, and the system would represent a milestone for tokenization. Given Alibaba’s substantial ecosystem, the platform could ultimately process billions in annual volume.

Participating in a Payment

For Alibaba, the benefits of this system are clear. It would allow the company to move money across borders and between currencies without relying on multiple banks or crypto exchanges.

Although technology has brought businesses and consumers closer together around the world, payments have not kept pace. The current cross-border model still depends on a correspondent banking network, where several banks may be involved in processing a single transaction.

This often results in delays, higher costs, and limited visibility into money movement. These issues have persisted despite efforts by regulators and the launch of various cross-border payment solutions.

The Leading Contender

Digital assets are emerging as one of the leading contenders to streamline this process. Company-issued stablecoins like Circle’s USDC and Tether’s USDT are tied to the value of the U.S. dollar and backed by the issuing company’s reserves. Tokenized deposits operate similarly, except they are issued and backed by financial institutions.

JPMorgan has been active in both tokenization and stablecoin deployments through its Kinexys digital assets brand. Among other projects, the company recently launched its JPM Coin on Coinbase’s Base network—a token built for use by institutional clients.

While it’s not yet clear whether the JPM Coin will play a role in the Alibaba partnership, the launch of the latter’s system represents a step toward broader tokenization adoption in real-world B2B applications.

Alibaba’s business segment has also seen rapid growth in its supplier base. The brand’s number of active suppliers worldwide has grown by 50% year-over-year during the March-October period.

The post Alibaba Taps Tokenization Tech for Cross-Border B2B Payments appeared first on PaymentsJournal.

Fraudulent credit activity is on the rise, and it’s costing lenders—and consumers—millions. TransUnion is launching a solution to fight credit washing, a scam in which criminals remove legitimate negative credit data to temporarily boost their scores and secure loans they never intend to repay.

Credit washing often involves disputing accurate negative information on a credit report. The temporarily boost can allow criminals to obtain auto loans, credit cards, or other financing, leaving lenders and businesses holding the financial losses.

A Possible Solution

According to TransUnion, these schemes have surged in recent years. Roughly 5% of U.S. consumers have had charge-off accounts suppressed for what it calls “atypical reasons” just this year. It estimates that $10 billion in debt will be removed from credit reports by the end of the year.

TransUnion’s solution enables lenders to route suspicious consumers to manual review, reducing early charge-offs. Its Credit Washing Default Score identifies consumers with a history of charge-off suppression who may be at elevated risk of defaulting on new accounts within 12 months. The product also includes algorithms that track changes in reported charge-offs across six lines of business, including auto loans and bank cards.

An Unfortunate Side Effect

Credit washing is possible because of the Fair Credit Reporting Act, which was originally intended to help victims of identity theft. If a consumer reports that they have been a victim of identity theft, their financial institution and the credit bureaus are legally required to block the impact on the disputed account within four days while the claim is being investigated. The request can be denied or later revoked if the institutions can prove misrepresentation, but doing so is not always feasible within the narrow window allowed by law.

“What seems to be particularly tricky about credit washing is the first party fraud angle, which is often difficult to distinguish from legitimate fraud claims,” said Suzanne Sando, Lead Analyst of Fraud Management at Javelin Strategy & Research. “Without strong fraud detection in place to identify and analyze the right signals to actually determine if the dispute is legitimate, these claims get approved, negative marks get removed, and the credit score jumps high enough for a loan to go through. It’s yet another avenue that some consumers have exploited for financial gain without detection.”

The post As Credit Washing Surges, TransUnion Fights Back appeared first on PaymentsJournal.

More retirees are struggling to stay on top of their finances, which is one reason Bank of America is launching its 401k Pay platform.

The platform is designed to help customers convert 401k assets into retirement income. It also includes management features, such as the ability to set up recurring withdrawals from 401k funds.

Many retirees are uncertain about the best way to manage their retirement savings. To address this, 401k Pay will offer guidance on retirement spending and provides tools to help users monitor their funds.

The platform is designed to determine the appropriate retirement income a customer should generate from their 401k account. This calculation is based on a holistic snapshot of the user’s  finances and takes into accounts factors like cost of living, state and federal taxes, and required minimum distributions.

Feeling the Pinch

Retirement fund management tools are increasingly important, as macroeconomic factors have caused many retirees to feel the same pinch as the broader population. A combination of inflation and rising interest rates have strained budgets for years, often forcing retirees to rely on credit cards to meet their obligations.

According to the Employee Benefit Research Institute (EBRI), over two-thirds of U.S. retirees had outstanding credit card debt last year, marking a substantial increase from years past. Much of this debt was carried into retirement, as those entering retirement today tend have higher levels of debt than previous generations.

Planning for Unforeseen Expenditures

This growing dependence on credit cards is particularly concerning given the fixed incomes many seniors rely on.

Retirees are also more likely to face unexpected expenses related to health, home, or auto issue. Data from AARP shows that credit card debt remains the most common type of debt among adults over 50, with half of respondents citing medical expenses as a contributor to their monthly revolving debt.

The potential for unexpected expenditures underscores the importance of tools that help retirees monitor and manage their retirement funds effectively.

The post Bank of America Launches 401k Management Platform for Retirees appeared first on PaymentsJournal.

Visa has launched a pilot program allowing freelancers and gig economy workers to receive payments in stablecoins. Building on Visa’s stablecoin cross-border project introduced last month, this initiative will test whether such payments are viable.

The Visa Direct pilot lets businesses fund payouts in fiat currency while disbursing earnings directly to workers’ stablecoin wallets. It follows a previous Visa Direct program that allowed entities to pre-fund accounts in local currencies for cross-border stablecoin payouts

Lower Costs for Businesses

Stablecoin usage for domestic payments remains less explored, but the Visa project builds on a few emerging trends. The low transaction costs associated with stablecoins make them useful for high-frequency, low-value payouts, such as those a gig company might make to its workers.

The state of Wyoming introduced its own stablecoin in August with similar ambitions, hoping that contractors would use it to pay workers. However, the benefits for freelance workers in the U.S. are less clear.

“The use cases for gig workers are probably for solutions like Upwork, Fiverr, Guru and the like, where U.S. firms outsource work like coding to resources in India and other locations where labor costs are lower,” said Hugh Thomas, Lead Analyst, Commercial and Enterprise at Javelin Strategy & Research. “I see no real need for this when it comes to U.S.-to-U.S. gig work.”

Visa may see more traction in Latin America, where transaction costs are especially high. According to Mastercard, the average cost of sending remittances in Latin America is 6.3%, so the program could lower costs for gig-economy companies there.

Seeking Faster Payments

On the other hand, Visa’s data suggests that these workers are looking for more reliable and faster payment methods. More than half of creators surveyed said they prioritize instant access when choosing payment methods, and 86% have had to use personal funds or credit cards to finance their work.

Visa also found that these workers are already being paid through digital processors and platforms. It hopes this indicates both their comfort with modern payment technologies and a potential pathway toward wider stablecoin adoption.

The post Visa Aims to Expand Stablecoin Usage to Gig Workers appeared first on PaymentsJournal.

In a bid to curb an escalating wave of phishing and financial fraud, Google has filed a lawsuit against a group of cybercriminals allegedly behind large-scale credential theft campaigns.

These threat actors, known as the Smishing Triad, use a phishing-as-a-service toolkit called Lighthouse to develop and deploy convincing text-message scams. These fraudulent texts contain malicious links to phony websites designed to pilfer victims’ personal and financial data. Like many phishing attacks, they often pose as urgent notifications from legitimate organizations like E-ZPass, the U.S. Postal Service, or Google.

According to Google, the Smishing Triad’s operations have comprised between 12.7 million and 115 million credit cards in the U.S. alone, with victims spanning across 120 countries.

Segmenting Fraud Operations

One of the most troubling aspects of modern cybercriminal organizations is how organized and widespread they have become. Investigators, for example, found that the Smishing Triad had roughly 2,500 members active on the Telegram social media platform, where they both recruited new participants and shared instructions on how to operate Lighthouse.

The group had also divided its operations into specialized teams. Researchers uncovered a data broker group responsible for supplying lists of potential victims and contacts, a spammer group tasked with sending text messages, and a theft group that coordinated the actual attacks.

Unfortunately, these kinds of organized cybercriminal syndicates are becoming increasingly common. Palo Alto Networks recently uncovered attacks by the Jingle Thief group, which uses phishing techniques to infiltrate gift card systems and issue cards for resale—particularly around the holidays.

The Demand for Action

Understandably, these threats have prompted action, but Google is the first company to take legal action. The tech giant has filed claims under the Racketeer Influenced and Corrupt Organizations (RICO) Act, the Lanham Act, and the Computer Fraud and Abuse (CFAA) Act.

While the immediate goal is to shut down the Smishing Triad and the Lighthouse platform, Google also hopes to deter copycat groups from treading a similar path. Regardless of the outcome, the lawsuit represents just one tool in the broader fight against fraud. Google has also called for tougher regulations to curb cybercrime and improve coordination across the industry.

The post Google’s Latest Weapon in the Fight Against Fraud: Litigation appeared first on PaymentsJournal.

The Senate has moved one step closer to regulating cryptocurrencies as commodities rather than securities—a shift that would open the door to spot trading. The move aligns with the broader trend, accelerated under the Trump administration, toward easing restrictions on crypto.

A new bipartisan discussion draft from the Senate Agriculture Committee would grant the Commodity Futures Trading Commission (CFTC), rather than the Securities and Exchange Commission (SEC), explicit authority to regulate spot market trading in digital commodities.

“It would, for the first time, create a federal regulatory regime for trading spot non-security crypto assets, define boundaries between CFTC and SEC, enhance consumer protection as it builds on the CLARITY Act, and would provide clarity and certainty to exchanges and investors,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “It also has a focus on self-custody protections, developers, and infrastructure providers. Everyone knows they’re not money transmitters, so this classification would be accurate.”

The Move to Spot Trading

While crypto exchange-traded funds (ETFs) have been available for nearly two years, regulators have yet to approve spot trading, which would allow investors to buy and sell individual digital assets on the open market. Acting CFTC Chair Caroline Pham has said the agency is pushing to allow leveraged spot crypto trading, and U.S. crypto exchanges could be able to launch leveraged crypto spot products as early as next month.

Until now, the SEC has played the primary role in overseeing crypto trading, including approving and supervising ETFs that hold digital assets. However, the crypto industry has argued that digital assets are commodities—like gold and other precious metals—and should be regulated as such.

“Because the SEC has been so hostile towards the industry over the last administration’s four years, I think it provides the industry with a big sigh of relief,” said Hugentobler.

Approved by the House

The House of Representatives had already designated the CFTC as the leading regulator of digital assets in the U.S. last year. At the time, the Democrats controlled the Senate, and their skepticism toward the crypto industry meant that the bill never advanced.

With the Republicans now controlling the Senate, the draft legislation appears more likely to pass. New Jersey Democrat Cory Booker, one of the co-authors of the draft, may also bring other Democrats on board.

The post What the CFTC Has in Store for the Crypto Industry appeared first on PaymentsJournal.

It was a good idea at the time. No issuer made a meaningful play to create a co-brand in the rental industry. With almost 50 million households renting their homes, couldn’t a top issuer come up with a program that rewards all parties to create a leading co-brand franchise? With top issuers offering cobranded cards in partnership with airlines, retailers, and other entities, there is evidence that these alignments are effective, fueling the majority of credit card offerings in the United States.

The answer, so far, is no. Javelin Card Bench, a competitive intelligence tool for top credit card issuers, observed that Wells Fargo officially pulled back the Bilt application site. Card Bench identified this shift within hours of the change.

The Bilt/Wells Fargo relationship has been floundering almost from the beginning. It made a big splash, with a promising pipeline, but cardholders outsmarted the marketers. Savvy cardholders did not revolve as expected (though who would want customers who do not settle their rent monthly), and they rarely used the card for substantial purchases beyond the credit card link.  The WSJ conducted a deep dive on the downfall of the card more than a year ago, which can be found here. A snippet of the Javelin Card Bench Flash Report appears below.

Lose One, Gain One

One of Javelin Card Bench’s reporting functions is the Flash Report. Users can receive journalized daily change updates or cluster them over a few days, as illustrated in this example.  Here we see the Wells termination and a new launch by Capital One on their T-Mobile Visa card.  In contrast to the Bilt relationship, we believe Capital One can be a winner if it provides value to its mobile base, which includes approximately 130 million people. Capital One, now with Discover as the top U.S. card issuer, is no novice to credit cards and has deep experience with running cobrands. However, that is a story for another day.

Watch for Bilt 2.0

Bilt continues to be a strong business on its own, but has a new suitor for its cobrand, named Cardless. This will be interesting to watch. Cardless is not a top issuer like Capital One, Discover, or Wells Fargo. They issue cards through First Electronic Bank, based in Salt Lake City. Cardless offers an embedded card platform and has a few interesting clients. 

And, the world can use another stab at linking renters to credit cards. Although the margins are tight, there are plenty of them. As we say in credit card payments, you can always make up the margins with volume.

The post Evicted: Wells Fargo Stops Marketing Bilt appeared first on PaymentsJournal.

Venmo’s new rewards program Stash lets users earn rewards for activities such as receiving direct deposits or shopping with participating retail partners. However, these rewards don’t apply to the company’s flagship peer-to-peer payments service.

The Venmo Debit Mastercard already offers 1% cash back on purchases made from the card balance and 2% with auto reloads. Stash is designed to encourage customers to keep more funds in their accounts, offering up to 5% cash back for those who receive eligible direct deposits of at least $500.

“Venmo’s new reward plan is not only about increasing spending but about retention,” said Ben Danner, Senior Analyst, Credit and Commercial at Javelin Strategy & Research. “Given the rewards enhancers for auto reloads and direct deposits, Venmo is trying to be a primary vehicle for consumer payments.”

A new Stash feature also lets cardholders choose from curated bundles of their favorite brandsto earn up to 5% cash back on Venmo debit card purchases. Users can select from groups of participating brands such as McDonald’s, TikTok Shop, and Uber.

“The personalization of rewards is a key feature of the Venmo merchant bundling,” Danner said. “Venmo isn’t the first to use merchant-funded rewards on a debit card, but the issuers do this because it is a way to fund the card without having to foot a large rewards expense bill on the issuer side.”

Not Applicable to P2P

At this point, there is no reward for making peer-to-peer payments, which remains Venmo’s core offering. According to CoinLaw, Venmo is projected to hold a 61.8% share of U.S. mobile P2P payment users in 2025, with a user base exceeding 100 million customers.

However, Venmo is exploring new ways to expand the Stash ecosystem. The company says consumers will start earning rewards for paying with Venmo at its network of nationwide merchants sometime next year.

Seeking Younger Consumers

Venmo has also been working to build up its debit card offering. CNBC reported last summer that penetration among Venmo users remained in the single digits, compared with 44% of Cash App users.

The move aligns with Venmo’s ongoing strategy to attract younger consumers, who tend to prefer debit cards over credit cards. Earlier this year, Morning Consult’s survey found that 63% of Gen Z had abandoned credit cards in favor of alternatives such as debit cards and cash.

The post Venmo Introduces New Rewards Program appeared first on PaymentsJournal.

Fannie Mae is lowering its minimum 620 middle credit score requirement for purchases and refinance loans—a move that could broaden access to homeownership for borrowers with thinner credit files or lower scores.

Following Freddie Mac’s lead, Fannie Mae is removing the threshold from its Desktop Underwriter (DU) eligibility determination system. While DU may no longer require a credit score, it will continue to evaluate loans using a comprehensive set of credit risk criteria to determine whether they qualify for sale to Fannie Mae.

The impact on homebuyers could be significant, even though Fannie Mae and Freddie Mac do not originate mortgages directly. These entities purchase loans from other mortgage lenders, but lenders often check borrower eligibility in DU and Freddie Mac’s platform before issuing loans.

The policy shift could especially benefit “near-miss” borrowers: those with consistent income or cash reserves but credit scores that previously fell just below the 620 cutoff.

Still, Fannie Mae will continue to weight multiple risks, including property attributes, occupancy status, whether the loan is a purchase or refinance, borrower debt levels, and available cash reserves.

An Older Homebuyer

This change in eligibility criteria comes amid mounting challenges for younger consumers trying to buy homes. According to the National Association of Realtors, the median age of a first-time U.S. homebuyer has climbed to a record 40 years old—a sharp jump from 33 just five years ago.

At the same time, first-time buyers now account for less than a quarter of all home purchases, the lowest share in nearly 45 years.

Gauging the Risk

Although removing credit scores from the mortgage eligibility equation could open the door for more buyers, credit scores are still a critical measure of borrowers’ ability to repay loans—and a key indicator of broader economic health.

Recent data from credit bureau TransUnion found a widening divide in consumer credit profiles, with borrowers classified as either super prime or subprime, leaving fewer in the mid tier. This polarization has been driven by long-term economic turmoil and rising household debt.

In addition to credit card debt, which has been hovering near all-time highs, more consumers are taking on unsecured personal loans, and auto loans have veered into delinquency. Since Fannie Mae and other mortgage lenders must still consider this debt when determining loan eligibility, it’s unclear whether removing the credit score requirement will meaningfully expand access to homeownership.

The post Fannie Mae to Drop Minimum Credit Score for Homebuyers appeared first on PaymentsJournal.

Massachusetts is the latest state to update its money transmission laws—a move welcomed not just by consumers but also by the fintechs the law is meant to regulate.

The primary goal of the new legislation is to strengthen consumer protections for users of services such as Venmo, PayPal, and CashApp, “With this new law, consumers in Massachusetts will now have protection when transferring money to friends and businesses through payment apps,” Governor Maura Healey said when signing the bill earlier this year.

The updated rules establish a uniform licensing and compliance framework for all entities engaged in money transmission. Payment apps will now be required to obtain a license and adhere to the regulations and consumer protection standards set by the commonwealth’s Division of Banks. Non-bank entities offering banking services will also face oversight similar to that of traditional financial institutions, including more frequent and detailed reporting requirements.

A Consistent Set of Rules

With the Consumer Financial Protection Bureau taking a back seat under the Trump administration, states are stepping in with new laws of their own. Regulators are working to bring greater consistency to how transmission activity is defined, licensed, and monitored nationwide. A coalition of state financial regulators has adopted a model framework that allows regulators across multiple states to collaborate on these efforts—an approach known as networked supervision.

Building on that effort, Georgia, Nebraska, Colorado, and Connecticut each updated their transmission statutes earlier this year, bringing the number of states with modernized transmission laws to more than 30.

Appreciating the Guidance

While the new regulations increase the burden on bank-like fintechs, they also create a more navigable landscape for a growing array of payment processors. Many of the older state money transmission laws were designed primarily for services like Western Union and Moneygram.

“New payment entities range from earned wage access entities like Dailypay, to online gambling, to peer-to-peer apps like CashApp and Venmo,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Fintechs generally appreciate the guidance instead of having to spend their own legal efforts to figure out what laws apply, if they apply, how they apply, and so forth.

“Organizations like CashApp have to go state by state and get 50 individual licenses to offer their services to residents of those states,” he said. “It’s important that they have consistent laws to deal with.”

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As Agentic AI continues to emerge as a force shaping the future of shopping, Microsoft has conducted an experiment to test its effectiveness—running several AI agents through a simulated marketplace. The study found that these agents are susceptible to manipulation and tend to struggle when faced with too many options—much like humans. The results suggest that the technology still has a long way to go before it’s ready for widespread adoption.

Using 100 virtual customers and 300 virtual businesses, the experiment modeled transactions such as ordering food or hiring home improvement services. Each customer had a list of desired items and amenities required for the transaction to be considered satisfactory.

The good news is that both advanced proprietary models and open-source systems outperformed simple baselines, such as randomly selecting or always choosing the cheapest option. GPT-5 was the top-performing agentic model, achieving near-optimal results.

Flummoxed by Complexity

As scenarios grew more complex, Microsoft found that the results became less impressive. Loading the AI agents with more options and search results actually reduced the number of comparisons they made, as the models tended to settle for the first “good enough” option. With the exception of GPT-5 and Gemini-2.5-Flash, the agents ended up contacting only a small fraction of the available businesses. In one case, a model repeatedly reached out to businesses that did not offer the goods or services the customer was seeking.

The AI agents were also vulnerable to manipulation by the very websites they were searching—meaning the same marketing tactics that influence human shoppers also worked on the bots. Microsoft’s conclusion: “Agents should assist, not replace, human decision-making.”

Shoppers Remain Unconvinced

Many have tried or considered using agentic AI, according to Javelin Strategy & Research, but remain unconvinced that it will improve their lives. The Microsoft study suggests AI agents still have significant ground to cover before becoming a natural part of consumers’ routines.

“There’s very strong evidence for consumer interest in using chat like tools to consider purchases,” said Christopher Miller, Javelin’s Lead Analyst in Emerging Payments. “There is some evidence that they would be willing to complete the purchases through their agents, although the raw numbers are very, very small. But if you never decide that ChatGPT is your first stop to get information about stuff, and you continue to go through Google, then this opportunity doesn’t grow to be as big as some people think it will.”

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The travel and expense reimbursement process is a common pain point for many organizations—an issue American Express and Emburse aim to solve with virtual cards.

Within Emburse’s expense management platform, Amex is introducing virtual card issuance capabilities, coupled with real-time transaction data that give organizations visibility into card activity.

For example, a customer could issue an Amex virtual card for a business trip. Once issued, expense entries would automatically be created, and the organization would receive card live updates on card spending as they occur.

Self-Evident Applications

Many industries are only now realizing the benefits of using virtual cards for enterprise payments. Each virtual card is issued with a unique card number, expiration date, and security code—details that not only protect sensitive data, but can be leveraged for reporting.

The advantages of virtual cards in travel and expense management are clear, especially compared with the traditional process where employees pay out of pocket and later submit receipts for reimbursement.

Beyond that, virtual cards also offer distinct benefits over company-issued physical cards. They are far less likely to be lost or stolen, and organizations can set precise spending controls. These may include transaction limits or restrictions that confine a virtual card’s use to specific vendors or sectors.

Furthering the Use Case

While travel expenses are a common use case for commercial virtual cards, their potential extends much further. In fact, virtual cards are often much more efficient for any employee-initiated purchase. This allows employees to make indirect yet essential purchases, including maintenance items or event supplies, without having to go through the purchase order process.

While the benefits of virtual cards are significant, many companies remain unsure about how to deploy them effectively.

“It’s only good to be used to make payment to that one supplier, conceivably on that day,” Hugh Thomas, Lead Commercial and Enterprise Payments Analyst at Javelin Strategy & Research told PaymentsJournal. “It’s got all the benefits of a card wrapped on top of it, the recourse to charge back if you don’t get what you said you were ordering, and so forth.”

“Now you have a solution that has a bunch of benefits to it, but also a bunch of costs to it where you need to be conscious of where the thing is best applied—and that is not something that’s immediately intuitive,” he said.

The post Amex and Emburse Launch Virtual Card Program for Expenses appeared first on PaymentsJournal.

The digital euro has faced a difficult path to fruition, with many of Europe’s leading financial institutions questioning whether a central bank digital currency (CBDC) can deliver real value to EU citizens.

Discussions around the project began in 2020, as lawmakers explored ways to provide EU consumers with a digital alternative to cash. The initiative also aimed to counter the growing influence of foreign currencies and payment systems, including the extensive global networks established by Visa and Mastercard.

In response, several major EU banks banded together to launch Wero, a payments rail designed to enable consumers to pay-by-bank across the region. Now, this same group of lenders—including Deutsche Bank, BNP Paribas, and ING—are voicing concerns that the digital euro could ultimately undermine private sector payment systems like Wero.

A Rocky Road

This challenge is only the latest in what has been a rocky road for the digital euro. After the European Central Bank (ECB) began a preparation phase for the CBDC two years ago, there was speculation that the digital euro could be launched as soon as this year. However, that timeline has since been revised, with a pilot program now expected in 2027 and a full launch projected for 2029.

As the program has been delayed, concerns about privacy and security have grown. Because the EU government would have the ability to track transactions made with digital euros, many member states have questioned whether officials might misuse this functionality to surveil citizens.

Adding to the tension, a recent ECB system outage left trillions of euros in limbo, raising further doubts about the initiative’s security and reliability. EU nations have also struggled to reach consensus on key details, including how the digital euro should be issued and how many tokens each resident should be allowed to hold.

A Moot Point

One of the most damning critiques of the digital euro is that it is superfluous. In a statement to the ECB, the group of financial institutions that backed Wero argued that the CBDC largely replicates existing private solutions without offering any additional value to consumers.

While a government-backed digital currency could offer certain advantages, the long runup to the digital euro’s launch gives private sector companies ample time to develop products that could make the CBDC a moot point.

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Google Play is launching a dedicated section within its App Store that allows shoppers to search for, purchase, and send digital gift cards, featuring brands ranging from Starbucks to American Eagle. While the move could generate some ancillary revenue for Google, it remains unclear whether consumers will start viewing the Play Store as a primary destination for buying gift cards.

The rollout was surprisingly low-key. Rather than making a formal announcement, Google quietly notified users via email with the subject line: “Important Update to Play: Now you can buy Gift Cards.”

Changing Customer Behavior

Google has a long road ahead in changing consumer habits in this space. Buying digital gift cards through an online marketplace offering multiple retailers is still relatively uncommon.

“Javelin’s statistics show that consumers are most likely to visit a multi-card in person display, a retailer’s own store or website to buy a gift card,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “Significantly fewer people go to a website that sells cards for multiple retailers, which would be the most similar outlet to the Play Store.

“It will give Google a nice additional play to garner a little bit of revenue, but consumers won’t think of it as an obvious place to buy cards,” he said. “I think they’re tapping into that population to try and get net additional sales on top of apps and subscriptions—more than to try and get people specifically shopping for a digital gift card.”

For now, the digital gift cards are available only to shoppers in the U.S., the UK and Mexico. Expanding to the UK could be especially significant, as digital gift cards there now represent more than half of the market. According to Hirschfield, the U.S. is expected to reach a 50/50 split between physical and digital gift cards by the end of the decade.

More Changes in Play

Google has long offered both physical and digital Play Store gift cards. The addition of third-party digital gift cards to the Play Store comes as the company faces pressure to open its marketplace to outside sellers following its long-running legal dispute with Epic Games.

As part of its proposed settlement, Google has told a judge it would make it easier for users to download and install third-party app stores. The company is also reducing its billing fees to 5%, down from the current 15%. 

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The indictment of three cybersecurity professionals accused of running their own ransomware operation is a frightening reminder that those entrusted with protecting digital systems often possess the same skills required to exploit them.

While few want to imagine their own cybersecurity experts acting with malicious intent, the case reinforces the importance of a zero-trust approach—one that assumes every users and system could be compromised. Effective zero trust relies as much on a company’s culture and vigilance as it does on its technology.

According to an indictment filed in Florida last month, rogue employees of a Chicago company that specializes in negotiating ransomware settlements allegedly launched their own malware attacks against at least five U.S. organizations between May and November 2023. While there’s no evidence the accused targeted their own client, they are charged with using their insider knowledge of ransomware response tactics to prey on vulnerable entities.

Can You Trust the Experts?

Organizations must be constantly alert to breaches. Cybersecurity professionals must earn and re-earn their clients’ trust—and the principle of zero trust is an important starting point.

“‘Trust but verify’ is a phrase commonly used in cybersecurity to explain the need to continuously authenticate, verify, and scrutinize every device, user, and endpoint,” said Tracy Goldberg, Directory of Fraud and Security at Javelin Strategy & Research. “Even if a system or user is trusted, their authenticity and actions must constantly be verified to prevent unauthorized network access and malicious activity.”

Healthcare Has Unique Vulnerabilities

According to an affidavit, the first attack occurred in May 2023, when a medical company in Florida was targeted with a $10 million ransom demand. The group allegedly went on to attack a Maryland pharmaceutical manufacturer and a California doctor’s office, according to CSO Online.

Healthcare organizations are frequent targets of such attacks because of the vast amounts of personal data they hold. Last year, the personal information of 100 million individuals was stolen during a ransomware attack on Change Healthcare, which resulted in a $22 million ransom payment.

“Healthcare must invest more in cybersecurity, perhaps second only to education,” said Goldberg. “Healthcare is widely known for its cybersecurity vulnerabilities, and exposure of employee and patient Personal Identifiable Information.”

That attack was attributed to the AlphV/BlackCat ransomware group, the same group named in the recent Chicago indictments, though it remains unclear whether the individuals charged were involved in that particular incident. According to Trustwave SpiderLabs, Russia-based AlphV was responsible for roughly a quarter of all ransomware attacks in 2024.

The post When Security Professionals Turn to the Dark Side appeared first on PaymentsJournal.

There are now more super prime and subprime borrowers, leaving fewer consumers in the middle of the credit market.

According to TransUnion, the share of super prime borrowers—low-risk consumers with exceptional credit scores—increased from 37.1% in Q3 2019 to 40.9% in Q3 2025, representing roughly 16 million additional customers.

At the other end, the subprime segment also saw an uptick after contracting during the pandemic, when many consumers paid down debt. Together, the super prime and subprime groups drove higher origination volumes and overall growth in the credit card market.

“TransUnion always has great card-level data based on information furnished by lenders,” said Brian Riley, Director of Credit and Co-Head of Payments at Javelin Strategy & Research. “Here we see consumer polarization between good scores and weak scores, and everything in between. Super prime cards are booming, and you can expect to see more with Amex, Chase, and Citi’s amped up offers.”

An Avalanche of Offerings

The premium card market has heated up as economic conditions continue to batter the average consumer. To reach more affluent—and potentially more stable—customers, American Express and Chase have both recently enhanced their premium card benefits and raised annual fees.

Citi followed suit with the launch of its premium-tier Strata Elite card, and an avalanche of offerings aimed at the super prime market has followed. Even Klarna launched subscription tiers for its debit/BNPL card, designed to offer luxury perks without the debt associated with traditional credit cards.

More Stress Is Ahead

Meanwhile, the spiraling credit card balances have pushed many consumers, especially in the subprime segment, toward BNPL cards. However, the TransUnion report found that despite the significant amount of existing debt and credit growth in the subprime segment, delinquencies have continued to decline.

This may reflect improving consumer credit health, but issuers have also played a role, most notably by tightening credit lines. The average new account credit limit has dropped, and TransUnion found that subprime credit limits were down 5% year-over-year. Still, even with the drop in delinquencies, credit card issuers aren’t out of the woods yet.

“With the government shutdown and SNAP, expect to see more activity in line utilization,” Riley said. “Delinquency is rising slightly, but not alarmingly. Watch out for some younger segments that are under stress, particularly if they are subprime.”

“Credit card managers should be using bureau analytics to keep their eyes on two specific data points outside of plastics as inflation persists,” he said. “The increasing number of unsecured personal loans is up from 25.4 million in 2022 to 31.8 million—which is a stress indicator for the household budget—and auto loans are increasing to a point that they can have a real household impact. With tariffs in flux, more stress is ahead. But do not forget middle America—the points between superprime and subprime—as that is where the volume is. Keep a cautious eye on increases in revolving debt.”

The post More Consumers Shift to the Extremes of the Credit Risk Spectrum appeared first on PaymentsJournal.

In what could be a blockbuster acquisition, Mastercard is reportedly closing in on a deal to acquire Zerohash.

Zerohash provides financial institutions with technology to offer crypto and stablecoin trading and tokenization services. As demand for these capabilities has surged in recent years, Zerohash has garnered significant attention and investment from major firms, including Morgan Stanley and SoFi.

One of Zerohash’s most notable partnerships is its recent deal with OnePay, a fintech majority-owned by Walmart. Under the arrangement, Zerohash will facilitate crypto trading within OnePay’s app, opening the door for crypto purchases at the world’s largest retailer.

Mastercard is reportedly set to acquire the company for between $1.5 billion and $2 billion.

“This is a solid example of Mastercard’s forward-thinking strategy,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “It’s a shift from partnerships to owning the infrastructure which should enable them to provide an in-house crypto or stablecoin as a service-type product (e.g. on and off ramps, custody, settlement, and staking).”

“Zerohash brings licensing—a U.S. money transmitter and a BitLicense—and clients,” he said. “From my understanding, they were going to be the company behind Morgan Stanley-owned E-Trade’s crypto product rollout next year, in addition to providing B2B infrastructure.”

Signaling Momentum

Mastercard’s move comes as U.S. stablecoin transactions surge, driven largely by the passage of stablecoin regulations. The use of stablecoins is also gaining significant traction in business-to-business and cross-border payments.

“This also signals momentum in the industry,” Hugentobler said. “This is one of the bigger deals, if not the biggest acquisitions that we’ve seen. All the embedded crypto rails that we picture are happening right in front of us.”

The Continuing Zeitgeist

In this zeitgeist, more companies than ever are expanding into digital assets. Notably, Visa recently piloted a program allowing businesses to prefund transactions via stablecoins on its Visa Direct cross-border payments platform.

As these companies race to add new functionalities, acquisitions are likely to continue. For example, Stripe acquired stablecoin company Bridge for roughly $1.1 billion in what was then one of the largest crypto-related deals to date. If Mastercard completes its acquisition of Zerohash, it would represent a continuation of this trend—rather than the end of it.

The post Mastercard Nears Zerohash Acquisition to Expand Stablecoin Reach appeared first on PaymentsJournal.

Chipotle is the latest retailer to learn that circumventing California’s gift card cash-out laws can cost far more than the value of the cards. The fast-casual restaurant giant was hit with a $246,000 fine over allegations that it failed to allow customers to redeem the unused portion of their gift cards in cash, as required by California law. More significantly, the chain was ordered to set up a website where customers could cash out their gift cards.

A class-action lawsuit filed last year accused Chipotle of offering meal vouchers to customers seeking refunds for the unused portion of their prepaid cards. In addition to not providing cash, as the law requires, the vouchers also expired after 30 days—whereas California law mandates that gift cards have no expiration date. In settling the suit, Chipotle denied any wrongdoing.

California is one of many states that require gift card issuers to redeem low-balance gift cards for cash upon request. The currently threshold of $10 is set to rise to $15 next year.

Following Home Depot and Taco Bell

In a similar case, Home Depot was charged with violating the law last year. In addition to a $750,000 fine, it was ordered to reprogram all its registers to automatically cash out gift card balances under $10. Taco Bell faced a similar fine and was required to implement cash-back training for all its store managers. Like Chipotle, these companies appear to have relied on individual stores to handle these redemptions on their own.

“In general, brands do a good job of complying, so these instances are rare,” said Jordan Hirschfield, Director of Prepaid at Javelin Strategy & Research. “There are also some questions about how cash back must be supported—some merchants believe that you can centralize this so the stores aren’t responsible on an individual level. The reality is that the cash back laws are a little vague in terms of process, creating those questions for retailers.”

Tough Decisions

As the state with the largest economy, California will continue to serve as a bellwether for retailers. Franchises that train employees on handling gift cards will need to consider California’s restrictive laws. However, for large, nationwide brands, the costs of supporting cash back policies may outweigh the potential penalties.

“The amount of training to staff—especially in industries with high turnover—for a relatively small occurrence is likely more costly and burdensome than the penalty,” Hirschfield said. “That’s true even in a state as large as California, which produces high amounts of total revenue.”

The post Chipotle Learns the Cost of California’s Gift Card Law appeared first on PaymentsJournal.

As credit card companies expand their premium offerings, Klarna is introducing membership tiers that provide perks for a price.

The company’s two tiers—Premium and Max—are launching first in Europe, with a U.S. rollout planned in the coming weeks. Subscribers will be able to redeem cash back rewards directly with Klarna’s travel and airline partners and enjoy benefits like airport lounge access, a ClassPass fitness and wellness membership, subscriptions to magazines and newspapers, and even a metal card.

Unlike traditional credit cards that charge an annual fee, Klarna’s model is a monthly subscription. The top-tier Max plan costs €44.99 ($52.39) a month, yet Klarna claims it delivers more than €5,000 ($5822.17) in annual value through its perks.

“Loyalty programs are a great customer acquisition strategy,” said Ben Danner, Senior Credit and Commercial Analyst at Javelin Strategy & Research. “The idea is to bring customers into the Klarna ecosystem and reward them for using their Klarna balance, which can be loaded by way of a debit card or bank transfer.”

“This positions Klarna as more than just a buy now, pay later vendor, but more in line with Venmo, where balances are stored and drawn from like a bank account,” he said. “However, the monthly fees to belong to the program cannot be too expensive for the region’s consumers and will need to align with consumer interests—and Klarna will need to do its research before launching this program in the U.S.”

Perks Without the Debt

Other companies, such as American Express and Chase, have revamped their premium tiers to offer more benefits while raising their annual fees. Citi followed suit with the launch of its Strata Elite card, and Capital One has entered this market with its Venture X card.

All of these products target more affluent customers, who have become increasingly attractive to issuers as economic conditions have worsened and many consumers have racked up credit card debt.

The Go-To App

Klarna’s model is unique because it gives users premium perks that aren’t tied to credit. Instead, membership rewards are linked to the Klarna Card, which functions as both a debit and BNPL card.

This marks another step in Klarna’s evolution toward becoming a full-scale financial services company. Like many of its fintech competitors, the company aims to be the go-to super app for consumers.

“It’s a similar play to what Venmo is doing here in the U.S—bringing customers into their ecosystem, presenting a physical card option to spend funds, driving money into their app, and offering card rewards,” Danner said. “And the metal card makes it feel more premium.”

The post Klarna Launches Premium Memberships, No Credit Card Needed appeared first on PaymentsJournal.

As fraud becomes more prevalent and organized, the need for an overarching solution to identify fraud patterns has grown. However, many financial institutions have been hesitant to share customer data due to compliance and privacy concerns.

Privacy-enhancing technologies (PETs) could help address these challenges. PETs enable organizations to share information across the industry while protecting personal data through pseudonymized or tokenized identifiers.

Two of the main use cases for this approach include detecting mule accounts and synthetic identities. Taken in a single instance, an account that is opened with seemingly legitimate credentials may not raise red flags. However, if the same synthetic identity is used to open accounts at multiple institutions within a short period, PETs could help identify the suspicious activity and enable timely intervention.

The Spiraling Scale of Fraud

The proliferation of fraud vectors has reached a point where financial institutions are facing significant impacts.

For example, organized criminal rings now recruit money mules through social media and other channels, exploiting a company’s already-verified customers to perform nefarious activities. While this may appear to be an isolated event, mule activity rarely occurs in isolation.

Indeed, such activity often happens on a large scale—so much so that criminal syndicates often use a “mule-herder” to manage the many mules and their accounts.

The Teeming Dark Web

This scale, amplified by sophisticated technologies like AI, has prompted more calls for a consortium approach to fraud prevention. A cyber fusion strategy is built on cooperation among financial institutions—sharing data and pooling resources to create fraud and money laundering defenses.

In addition to data sharing, a cyber fusion strategy should also include dark web threat intelligence. The dark web teems with consumer data, much of it stolen through pernicious malware like infostealers.

Dark web threat intelligence not only scours this data to find connections, but also extracts information from cybercriminal communications in forums and chat channels. These capabilities are essential for uncovering connections between bad actors, enabling authorities to properly attribute attacks and dismantle cybercriminal rings.

A cyber fusion strategy that incorporates PETs for secure data-sharing—combined with dark web threat intelligence—gives financial institutions their best chance to combat evolving fraud threats.

The post Privacy-Enhancing Technologies Can Supercharge Threat Intelligence appeared first on PaymentsJournal.

Total stablecoin transactions reached $10 billion in August, up from $6 billion in February.

In July, the United States passed the GENIUS act, a bipartisan bill establishing a federal framework for the issuance, trading, and custody of stablecoins. The legislation set off a flurry of new stablecoin launches from leading financial services firms, as well as potential launches from a wide range of companies and government agencies.

A report from Artemis, a blockchain firm, highlighted the connection between the passage of the GENIUS act and the resulting surge in stablecoin activity. However, the report also noted that stablecoin usage had already been on a steady upward trajectory. According to Artemis, stablecoin payment volumes in August more than doubled year-over-year, and could reach $122 billion annually if current trends continue.

Increasing Business Adoption

One of the most notable findings from the Artemis study was that business-to-business (B2B) payments have surpassed peer-to-peer (P2P) transactions as the leading use case for stablecoins. B2B payments have surged 113% since February and now account for roughly two-thirds of the stablecoin market.

This surge in B2B activity is also likely linked to the passage of the GENIUS act, as a better-regulated U.S. stablecoin market is proving attractive to many organizations. In a separate study from Ripple, many financial leaders indicated they are open to using stablecoins within the next three years, and roughly a third said they already use them in their day-to-day operations.

The top three use cases cited were cross-border payments, trade settlement, and serving as a traditional bank alternative.

Adding Cross-Border Functionality

Stablecoins have long been touted as a solution to the inefficiencies of cross-border payments. These digital assets offer immediate settlement, low fees, full visibility, and stable value—a strong alternative to the correspondent banking system, where payments are often delayed in a multi-step process that can be both risky and expensive.

This cross-border capability is one of the main reasons why many financial services organizations have launched or considered launching stablecoins. For example, Zelle, which is owned by seven major U.S. banks, recently floated its plans to launch a stablecoin.

While Zelle is currently the largest P2P platform in the U.S., its users must have a bank account to send funds. Adding a stablecoin to its product list could allow the platform to expand its footprint beyond U.S. borders.

The post Stablecoin Usage Surges After GENIUS Act Passage appeared first on PaymentsJournal.

For most merchants, getting customers to enroll in an autopay program is a highly desired outcome. But T-Mobile’s recent move to close a credit card payment loophole for its autopay customers signals there may be an even bigger ambition at play: avoiding interchange fees.

T-Mobile has long offered a $5 monthly discount to customers enrolled in its autopay offering. To qualify, customers were required to use a debit card or a bank account as their autopay method—credit cards were ineligible.

However, a kind of cheat code had emerged. Some savvy customers discovered they could register a valid debit card or bank account to secure the discount, then manually pay their balance with a credit card before the scheduled autopay date. Because the bill was already paid, T-Mobile didn’t process the automatic debit, but the customer still received the discount.

Losing the Discount

As of last week, these customers will lose their monthly discount if they make an early one-time payment on their bill using an ineligible payment method, such as a credit card. T-Mobile has apparently decided that avoiding interchange fees outweighs the value of keeping customers enrolled in autopay, despite the many benefits the subscription model provides.

“Autopay itself delivers the bulk of the benefits to the merchant,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “They save the cost of generating a bill, mailing it, and then waiting for payment. Even in our digital age, where you can create a PDF of a bill and email it, they still have to wait for you to pay it. Autopay even enables the merchant to put a fine point on their revenue forecast, because they are taking the money from me on an established date, not waiting for me to send it.”

Pushing Them Elsewhere

The strategy hinges on the assumption that T-Mobile customers who use credit cards almost certainly also have bank accounts. The gamble for the carrier is that these customers will be willing to switch to alternative payment methods rather than opt out of autopay—or worse, switch to another carrier.

“It’s no secret that rewards cards and business credit cards have high interchange costs for merchants,” Apgar said. “By limiting payment options to debit and ACH, they keep those costs down.”

The post T-Mobile Closes Autopay Loophole for Credit Cards appeared first on PaymentsJournal.

Over a five-year period, the number of credit card transactions in India has doubled, while the total value of those payments has nearly tripled—even as debit card transactions have declined in both volume and value.

A study by the Reserve Bank of India (RBI) found that credit card transaction volumes increased from roughly 2.1 million in 2019 to around 4.5 million in 2024. Over the same period, debit card transactions fell from approximately 5 million to 1.7 million.

The RBI attributed this divergence to differences in usage. Credit cards are more often used for e-commerce purchases, credit access, and larger purchases, whereas debit cards are primarily used for cash withdrawals and everyday spending.

The Rise of UPI

Although debit cards may be more of a staple payment method, one key factor behind their decline in India is the rise of the Unified Payment Interface (UPI) real-time payments system.

The National Payments Corporation of India (NPCI), which operates UPI, now handles almost half of the world’s digital transactions. Transaction volume on UPI has surpassed that of Visa and Alipay, and the platform continues to expand its global footprint, as evidenced by UPI’s recent expansion into Qatar.

A Payments Mainstay

With real-time payments systems, users can pay-by-bank through their phone without the need for a card. However, this doesn’t spell the end of the debit card.

In fact, several factors have strengthened debit card usage across many regions. First, tough economic conditions have driven credit card debt to record highs, pushing many budget-conscious shoppers back toward debit.

Second, many debit issuers have taken a page from the credit card playbook by offering rewards or cash back. These incentives are mostly funded by merchants who prefer customers use debit over credit to avoid higher interchange fees.

Finally, the surge of fintechs has led to more debit cards in circulation than ever before. PayPal, Venmo, and Cash App have long offered debit products, and buy now, pay later giant Klarna launched a debit card earlier this year.

Add to that the fact that real-time payments in many regions—including the U.S.—have yet to replicate UPI’s success, and it’s clear that debit cards are likely to be a payments mainstay for years to come.

The post As Credit Card Usage in India Has Increased, Debit Card Use Declines appeared first on PaymentsJournal.

A group of cybercriminals dubbed “Jingle Thief” is using phishing techniques to gain access to gift card systems, then issuing cards to resell for personal profit.

Researchers from cybersecurity company Palo Alto Networks uncovered the group’s tactics as Jingle Thief targeted the cloud infrastructure of retail and consumer services companies. Once inside, the bad actors search for the mechanisms that allow them to issue gift cards and work to cover their tracks.

Gift cards have become a growing target for cybercriminals because of their ubiquity in retail and e-commerce, both for gifting and self-use. Prepaid products can be redeemed easily and require little personal information from the purchaser, making it harder for authorities to track and identify those who exploit them.

Stopping the Drain

More regulators have been taking steps to mitigate gift card fraud. For example, Maryland recently passed a law aimed at combating gift card draining scams, which have become prevalent.

In this scam, criminal networks largely target retail cards sold in stores. Bad actors tamper with the packaging to obtain the card number and then return the compromised card to the shelf. Once an unsuspecting consumer purchases and loads funds onto the card, the criminals quickly drain the balance for their own use.

To address this issue, legislation such as Maryland’s bill requires secure packaging for gift cards, mandates that merchants register with the state, and calls for employee training to help prevent fraud.

A Tribute to Success

The threats against gift cards and prepaid providers are, in many ways, a tribute to their success. Consumers increasingly prefer cash and cash equivalents as gifts, but buyers are often reluctant to give cash because it is less secure and impersonal. That’s why gift cards have become one of the most popular gifts year-round—and especially during the holidays.

Unfortunately, the boom in gift card sales and usage around the holidays also creates vulnerabilities criminals can exploit. In fact, the Jingle Thief group earned their moniker because they are particularly active around the holidays.

The post Jingle Thief Bad Actors Target Gift Card Issuers for Fraud appeared first on PaymentsJournal.

Artificial intelligence is poised to shape this year’s holiday shopping season, with both consumers and merchants increasingly relying on it.

According to data from PayPal, more than three-quarters of consumers plan to use AI as a shopping assistant this holiday season. Already, 40% of respondents have used AI for purchases in the past year, with half of them doing so regularly.

The numbers are even higher among younger cohorts: more than half of Gen Z and millennial shoppers have used AI to help with shopping over the past year.

There isn’t a single way that shoppers are using AI. Holiday shoppers report using it for finding the best deals, comparing products, and discovering gift ideas or recommendations—but none of these activities were cited by even half of respondents.

A Vital Tool for Merchants

Separate data from American Express confirms that small businesses are accelerating their adoption of AI, with younger generations once again leading the way. In fact, 72% of Gen Z and millennial small business owners are using AI, compared to 59% of Gen X and baby boomer owners.

Interestingly, older generations are starting to catch up. Among small businesses that began using AI in the past year, more were Gen X and Baby Boomers than Gen Z and millennials.

Over nine in 10 small businesses say that AI helps them make more confident decisions, and a similar proportion report that it improves how they organize data and insights. Nearly three-quarters of small business owners report a positive ROI from their AI investments, with the most common benefits coming from increased employee productivity and reduced errors.

“To the extent that consumer behavior is shifting towards a willingness to use AI as a payment entity, that constitutes a capability challenge that you have to meet,” said Christopher Miller, Lead Analyst of Emerging Payments at Javelin Strategy & Research. “If you are not changing your technical and business capabilities to recognize that reality, you will lose out.”

The post AI to Transform Holiday Shopping for Consumers and Retailers appeared first on PaymentsJournal.

Master accounts with the U.S. Federal Reserve have traditionally been the sole domain of banks, but Fed Governor Christopher Waller has proposed a new model that could also accommodate fintechs.

At the Fed’s inaugural Payments Innovation Conference, Waller suggested that payment services companies might be able to obtain a payment account, or a “skinny” master account, that would give them access to the services they need.

For example, the account could provide access to the Federal Reserve payment rails while including safeguards such as balance caps, no interest on balances, and no daylight overdraft privileges.

Eliminating the Workaround

These accounts target fintechs that rely on banks’ master accounts to operate payment services. This workaround becomes a pain point as fintechs scale, and it has pushed many companies to seek bank charters of their own.

For example, merchant payments platform Checkout.com was recently granted a bank charter by the state of Georgia. Checkout.com’s main objective was to gain direct access to U.S. card networks like Visa and Mastercard, allowing the company to act as its own acquirer.

Looking for a Green Light

Expanding access has been a primary reason why digital assets companies like Ripple and Circle have applied for bank charters with the Federal Reserve. Ripple has also applied for a master account, which would allow the firm to hold reserves of its RLUSD stablecoin directly with the Federal Reserve, providing an added layer of security.

While Ripple’s master account has not yet been approved, Waller’s remarks could signal a potential path forward for the company and its peers. He emphasized the importance of innovations involving emerging technologies such as stablecoins, tokenization, and artificial intelligence, and highlighted the increasing role of digital assets in traditional finance.

However, any changes to the current model will take time to implement.

“If these ‘payment accounts’ become real, banks and other financial institutions can access Fed rails directly, which has been a friction point for crypto firms since the 2023 bank fiasco,” said Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research. “It’s not necessarily a green light for every crypto company, but I think it will be good for crypto exchanges and stablecoins—and eventually tokenization.”

“As the optionality for payments continues to grow, the Fed is recognizing that access to these tools needs potential oversight and better plug-in options for FIs,” he said. “It could come with some nuances like no interest on balances or capping balances, but even with those types of guardrails it could be a step in the right direction.”

The post Federal Reserve Governor Posits Master Account Model for Payments Firms appeared first on PaymentsJournal.

Amazon Web Services has recovered from an outage that disrupted online activity worldwide for nearly a day, affecting businesses like Venmo and Coinbase to small merchants who rely on AWS for payment processing. After the third shutdown in five years, questions are mounting about how dependent businesses have become on the cloud computing giant.

The outage began shortly after midnight on October 20. The disruption originated at AWS’s largest and most essential data hub in Northern Virginia—the same location that experienced outages in 2020 and 2021. Services were mostly restored by that evening, but the interruption let merchants unable to process payments and disrupted sales for nearly a full day.

Slowly Migrating to AWS

In recent years, merchants, payment service providers, banks, and other companies across the payments supply chain have quietly migrated to AWS as a way to scale their businesses without the fixed costs of building or expanding a physical data center.

“Cloud platforms promise secure, scalable and most importantly redundant data processing,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “Pay-as-you-grow data services have also enabled many fintech startups to get traction without having to invest significantly in data facilities. They can focus on the talent that will create the code, not the secure, climate-controlled buildings that will house the machines that run it.”

Seeking Stability Elsewhere

One of the primary selling points of large data centers, such as those operated by AWS, has been their reliability. Without that stability, many smaller companies might seek backup alternatives.

“Redundancy and uptime has always been part of the core value proposition of AWS,” said Apgar. “It will be interesting to see if this event will have a meaningful trend impact on AWS users either rethinking their cloud computing strategy or driving customers over to alternative providers, like Microsoft Azure.”

In the cloud computing market, Azure ranks second in market share behind AWS, but it has been steadily closing the gap. Meanwhile, the CrowdStrike outage in July 2024, which disrupted much of the internet, predominantly affected Microsoft systems.

The post AWS Outage May Have Merchants Seeking Backup Elsewhere appeared first on PaymentsJournal.

FedNow has continued to expand its network of financial institutions since its launch two years ago, and now PNC Bank is joining the real-time payments system.

The platform operated by the U.S. Federal Reserve now includes roughly 1,400 participating financial institutions. However, the addition of PNC is noteworthy—not only because the bank is one of the largest financial institutions in the U.S., but also because it was one of the last remaining holdouts.

JPMorgan Chase and Wells Fargo joined FedNow earlier, while Bank of America, Citigroup, and PNC had been more reluctant to participate. With Citi now on board and Capital One announcing its intention to follow suit, the number of major U.S. banks not participating in the platform continues to shrink.

Considering the Competition

One of the main reasons many banks were slow to adopt FedNow is that they are members of the Clearing House, a consortium of the world’s leading financial institutions. The Clearing House launched the RTP network in 2017, a real-time payments platform competes with FedNow.

Although PNC is a founding member of the Clearing House, the bank’s support for the FedNow system shouldn’t be interpreted as a lack of confidence in the RTP network. In fact, the RTP network recently set a new daily transaction record, processing over 1.8 million transactions, and continues to broaden the range of use cases on its platform.

Joining the FedNow Fold

While FedNow may have roughly the same number of institutions on its platform as RTP—or even more—it has not yet reached the payments volume of the more established network.

However, FedNow has continued to make strides. The system recently raised its transaction limits, first to $1 million and then to $10 million, positioning FedNow to handle high-value transactions like the B2B payments that have gained traction on RTP.

The addition of PNC Bank to the FedNow fold is another vote of confidence in the platform and could signal the future of U.S. real-time payments. As instant payments continue to gain ground, there may be room for both RTP and FedNow to coexist and thrive.

The post PNC Expands Real-Time Payments Footprint by Joining FedNow appeared first on PaymentsJournal.

In its ongoing efforts to make pay-by-bank systems more customer-friendly, Lloyds Bank is unveiling a kiosk that allows consumers to make payments at UK hotels. The system was developed in collaboration with Lolly, a hospitality technology specialist, and will be demonstrated at an Open Banking Expo in London.

The kiosk allows customers to make direct bank-to-bank payments without using cards. When travelers check out of a hotel, they can select the pay-by-bank option, scan a QR code, and complete the payment through their mobile banking app. Funds are transferred to the retailer’s account in real time, potentially reducing transaction times and processing fees.

Selling It to Skeptical Consumers

Pay-by-bank services have been growing in the UK. Stripe’s pay-by-bank service was successful enough there to justify launches in France and Germany earlier this year.

However, there is a sense that these services are being driven more by fintechs than embraced by everyday consumers. Some question whether the benefits of the new technology are compelling enough to encourage widespread adoption. 

“Consumers already have the ability to pay-by-bank when they use their debit card,” said Don Apgar, Director of Merchant Payments at Javelin Strategy & Research. “When you pay with your debit card, it takes the money out of your account. What benefit does the consumer get by following extra steps involving a kiosk to accomplish the same end result, namely paying for a purchase using funds they have in their bank account?”

Apgar thinks Lloyds may need to find an additional incentive to spur usage of the new technology, like a discount or a free dessert. The challenge, however, is that the cost to the merchant of providing the incentive could exceed the card fees they are trying to avoid.

Positioning in the Payments Landscape

Nevertheless, the technology may offer other advantages to Lloyds. In August, the bank launched a barcode-based cash deposit tool with a similar structure. This tool essentially allows customers to use their phones to make cash payments.

“From Lloyds’ perspective, they want to be on the frontlines and be viewed as a payments innovator,” said Apgar. “Even if this doesn’t take off, they will be in the front of the line for whatever is next.”

The post Lloyds Unveils Pay-by-Bank Kiosk for Hotels appeared first on PaymentsJournal.

As major issuers vie for the dominance in the premium credit card market, American Express appears to have pulled ahead, posting a standout third quarter fueled largely by its more affluent customers.

The company reported a 16% increase in Q3 profits, despite heightened competition among luxury card offerings. The average spend per Amex cardholder rose to $6,387, up 5% from a year earlier, and more members are now carrying balances on their cards.

Amex also saw a lift from higher fees. In September, it raised the annual fee on its Platinum Card from $695 to $895, while enhancing its perks and rewards program through new partnerships with Resy and Lululemon.

Following its strong Q3 results, American Express raised its full-year 2025 guidance, now projecting revenue growth between 9% and 10%.

“American Express is positioned well to leverage its recently improved credit card,” said Brian Riley, Director of Credit at Javelin Strategy & Research. “It has taken the pain out of an annual fee with an array of features that quickly offset the cost.”

Competition in the Luxury Space

Amex’s success comes even as competitors raise both the features and fees on cards targeting the affluent market. Citi entered the premium space last month with the launch of its Strata Elite card, which carries an annual fee of $595.

JPMorgan Chase also revamped its Chase Sapphire Reserve Card in June, increasing its annual fee from $550 to $795. To offset the higher cost, the company introduced a Points Boost feature, giving users the opportunity to double their points.

A Certain Cache

So far, consumers don’t seemed deterred by the rising prices. In fact, many have embraced the opportunity to showcase their upgraded perks. As part of its own refresh, Amex introduced a limited-edition mirrored version of its Platinum card. The company had expected about half a million requests by the end of the year—but it reached that milestone in just three weeks.

“Just when metal cards created a new class of customer features, Amex brings in the mirrored card that people love,” said Riley. “This illustrates how American Express addresses details well beyond the structure of the payment card. The firm has a long history of creating a certain cache with its cards, dating back to the old green card days. And it looks like high-net-worth customers are stepping up. You can see it in their volumes.”

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Months after launching its first U.S. credit card, Rakuten is now considering an initial public offering for its credit card business.

Best known for its online shopping platform, Rakuten operates one of the largest credit card programs in Japan, with more than 30 million cards issued. It entered the U.S. market with the Rakuten American Express Card, which runs on the Amex network but is not issued by American Express. Instead, the official issuer is First Electronic Bank, and Rakuten made the surprising choice of partnering with fintech startup Imprint to power the card program.