Fintech Digest - April & May 2017

AT&T car cryptocurrency

A patent by American telecoms company AT&T has been released that details a system to integrate cryptocurrency payments into vehicles. The system would work through an integrated computer that would generate a vehicle report based on environmental data from the vehicle – such as outside air quality measurements, traffic condition, road condition – and location data. Which would then be used to generate a digital currency value which would change depending on future vehicle reports. A record of this is kept in a memory. When the user attempts to pay for something the vehicle report would be up loaded and the currency value updated. This system would enable the user to pay for goods or services via a smartphone using a blockchain-based currency. 

Google’s watching you from home to point of sale

Google revealed Google Attribution a product designed to measure marketing impact across multiple devices. It integrates with Google’s existing advertising services like AdWords and DoubleClick Search. Attribution works on the back of Google’s pre-existing store visits measurement service (that uses machine learning and mapping technology to link and track customers’ online ad clicks to real-world store visits) by adding a store sales measurement (to see if customers who come to the store actually spend money). Google can link the payment to the search by the shop taking customers’ email addresses or by using its third-party partnerships that allows it access to 70% of credit and debit card transactions in the US. All data collected will be secure, Google promises. 

Quantum encryption for contactless payments

In partnership with Nokia, Bay Photonics and Oxford University, researchers have developed a system that could keep banking data safe when paying with contactless. The system uses quantum encryption involving sending millions of light particles to transmit encryption keys. A prototype the collaboration developed uses movable mirrors and ultrafast LEDs to send a pin code at 30 kilobytes per second over 0.5 metres. The system contains six pairs of resonant-cavity LEDs that are each filtered to different polarisation and position. The quantum key is long enough to prevent hackers from guessing correctly. The prototype is a handheld device - although rather large, the team hopes to scale it down for use in contactless payment devices such as phones. The quantum key is considered safe because even if someone cracks the code and attempts to pass it on, the nature of quantum rules dictates that it would be unusable as it would have already changed as a result of measurement. 

Voice ID tricked

HSBC’s voice identification software has been fooled by twins. The bank introduced the system for its telephone banking service First Direct with the intention of it being a more secure method of accessing its banking services. By saying the phrase ‘my voice is my password’ customers could gain access to their accounts. A BBC reporter (Dan Simmons) and his twin brother (Joe) accessed Dan’s account through Joe mimicking his brother’s voice. It was on the eighth attempt that Joe’s mimicking was considered similar enough to the original and he was allowed access to his brother’s account. (See:

Supermarket sweep: Barclaycard’s checkout free shopping

Workers buying food at Barclaycard’s staff restaurants in London are trialling the Pay + Go app that promises queue-less shopping by allowing users to scan purchases as they put them into their basket. Users download the app, create an account, input payment method details, use the smartphone camera to scan the barcode of items they want to purchase, pay with a single click and then leave the store. 

Virtual reality payment

Worldpay, a payment processing company, has developed an experience that allows the user to shop and pay all within a virtual reality (VR) environment. The prototype application works with a HTC Vive VR headset. The user shops for products in the app’s virtual environment where they are also presented with items’ prices and a virtual EFTPOS (electronic funds transfer at point of sale) terminal. For purchases under GBP30 the user can tap a virtual card against the terminal to pay. For payments above GBP30 the user is presented with digits 0-9 and must collect the four digits that make up their PIN by using a virtual controller. The company plans to market the app to retailers interested in VR shopping such as Ikea and Asos. 

Peer to peer payments on the rise

A report compiled by the Bank of America has revealed the normalization of peer to peer (P2P) payments among young Americans. The report surveyed 1005 adults and it showed that 62% of millennials use p2p payment methods and out of non-users 45% plan to make their first P2P payment within the next year. Users of P2P payment service say that convenience (68%), peer influence (48%) and to avoid using cash or cheques (16%) are their main reasons for using it. 30% say they began using it because of its integration with everyday bank apps. The speed and timeliness of payments is another area cited by respondents as being crucial to adoption of P2P payments. 

PayPal biometric identification for Android Pay

Paypal has announced that users with Paypal accounts linked to Android Pay will be able to use a fingerprint to pay for things on Google Chrome mobile web. The function will be made available to Android Pay, Google Chrome web, and PayPal customers in the US in summer 2017. 

Paperless receipts 

Flux, a UK startup, has launched a pilot in the east end of London for its paperless receipt software platform. The idea is to have itemised receipts such as traditional paper receipts in a digital format. The company has partnered with EAT and Bel-Air and Monzo (a digital bank). The system uses a software plugin to the retailer’s point of sale machine and can be seen by customers through a mobile banking app. The system also integrates loyalty schemes and cards into the app so that it can send the user a push notification when they have earned their free coffee. 

OneGram backing digital currency with gold

OneGram is proposing backing each unit of its cryptocurrency with a gram of physical gold. It is expected that when the coins go on sale there will be 12,400,786 tokens released. OneGram is working with GoldGuard, a gold exchange that buys and sells gold online. The company claims that backing it with gold will make investors more willing to buy its cryptocurrency, as the gold will provide a floor value for the currency. That means the buyer wouldn’t lose everything if the currency flopped. Moreover the company says that for each token bought the value will be reinvested into more gold which will in turn increase the amount of gold backing each token.

Token app

Token is a messenger app for smartphones that uses an Ethereum wallet to allow for payments between users within the app structure. Over time users will develop a reputation rating based on transaction history within the app. The company says their goals are:
1)    To provide financial services to people in the developing world. 
2)    Make it easier for people to build and use Ethereum apps. 
3)    Move digital currency from speculators to an everyday payment method.
The developer version of the app is available in app stores.

Japanese bank to give workers own digital currency

Nikkei Asian Review, The Japan Times and others have reported that Mitsubishi UFJ Financial Group’s (MUFG) Bank of Tokyo-Mitsubishi UFJ will be issuing its own digital currency – MUFG coins – to its staff to pay for domestic remittances as a pilot with a view to extend the use into the general market in 2018. Reports say the bank will value 1 MUFG at JPY1.



Add this: