Episode 19: 29th October 2015

Good morning, welcome to Payments Monitor, my name is Faisal Khan, today is the 29th of October 2015, some stories for today are:

TOP STORIES

The new bitcoin incubator Digital Currency Group (DCG) has managed to attract many big name investors and this growing list now includes Mastercard. Mastercard, who had previously stated that digital currencies are more a threat than an advantage, seems be adopting a change in its strategy with this latest investment.

In Germany, a new law is being proposed which will allow refugees, homeless people and asylum seekers to open bank accounts at any bank within the country. At the moment, Germany’s laws do not allow anyone without a proof of residency or identification to open a bank account and this new law could go a long way towards ensuring the financial inclusion of marginalized communities and decreasing the number of unbanked.

PayPal’s 3rd quarter financial result is out, the now separated payments giant reports a strong third quarter, with revenue of US$ 2.26 Billion (19% up from previous year’s quarter). Citing an active user base of 173 Million, processing nearly US$ 70 Billion in payments (up by 27% from previous year’s quarter).

Dwolla enters into a deal with its partner CME Group. Dwolla will be providing the Chicago based group with access to its technology to power payments on the Broker Payment Systems and Give Up Payment Systems, enabling customers to process payments faster.

US Economic growth slowed down sharply to 1.5% in the 3rd quarter as American companies reel back on inventories and orders. Bill Gates turned 60 and Deutsche Bank is looking to cut 15,000 jobs and sell some of its businesses that employ 20,000 people. Airbus scored a huge deal with China on the purchase of 130 Airbus wide and narrow body aircrafts.

OPINION ON CHINA

A mammoth shift in policy takes places in China today. The ruling Communist Party announced that it will abandon the one-child policy introduced in the late 1970s. Under the new policy, couples would be allowed to have two children. This represents a monumental shift as to how China’s coming years will shape. More people in an economy means more resources, more spending, more money movement. This can excel the Chinese economy in the next decade or two by providing it with a labour force growth that would be hard to reckon with, especially exportable labour. As the Bloomberg report summed up “You need people to make an economy go!”

CLOSING THOUGHTS

The oil glut. As many of us saw the oil prices rise and spiral out of control, sovereign investment funds saw their portfolios boom. All was good and then suddenly there was an oil glut - too much oil as they say. Now everyone is reeling in. Shell is readying itself for a long haul of low prices, Middle East is looking down in its money chest, trying to figure out how much money is left, oil production sets in US are filing for bankruptcy left, right and center, and the airlines, well, they still continue to charge high for travel (despite the low oil prices). I don’t know about you, but the word Karma does comes to mind.

You can access this podcast and all its links, including the archives on www.paymentsmonitor.com - That’s all for today, my name is Faisal Khan and you’ve been listening to the Payments Monitor. Speak tomorrow!