Two dozen retailers, including Walmart and Target, are joining forces to create a mobile payments platform, The Wall Street Journal is reporting.
WSJ quoted “people with direct knowledge of the project.”
The salient points:
The merchants say that they are concerned about potential security and privacy risks in the existing services. They also say that they are better-positioned than the other companies to devise services for their customers.
“What we see out there doesn’t make us very happy,” said one executive who is involved in the merchant venture.
The identity of most of the merchants participating in the retailers’ venture isn’t known, and people with knowledge of the project weren’t specific about how the venture would work. Other details couldn’t be determined, including the name and when such a product will be launched. …
Another participant in the project is Alon Brands Inc., according to people familiar with the situation. Alon operates more than 300 7-Eleven convenience stores in Texas and New Mexico. It also operates gasoline stations under the Fina brand name. …
According to people with direct knowledge of the retailers’ project, merchants say they are not satisfied with the mobile-payment products that have been launched so far, which limit the merchants to providing personalized offers and coupons.
On first blush, our reaction is — damn, it is getting messy out there in payments land. It seems so unlikely that any particular initiative will be able to operate in a vacuum from another. Neither this retailer endeavor, nor Isis, nor Google, nor whomever will have enough reach to achieve a critical mass of adoption. Or at least it doesn’t seem so today. Messy, indeed.
See the full report here.
A conference call held by Wells Fargo President and CEO John Stumpf, CFO Howard Atkins and Wachovia’s CEO Robert Steel. One of the final questions asked addressed whether Wachovia had binding agreement with Citigroup and does Wachovia owe Citigroup any compensation.
Wachovia’s CEO Robert Steel replied, “It seems there is some controversy about this and it will be addressed in an appropriate way.” Steel would not comment on whether or not compensation is owed to Citigroup.
JJ The big banks cannot claim that they have the “risk management” expertise. Look at the results!
When all of the mergers were happening, in the 90’s and early 2000’s, many acquired banks had better “credit administrators” but they were terminated anyway in the name of expediency. Wells Fargo and Nations Bank had a “take no prisoners” approach as they usually just paid the acquired senior staff to go away.
Most people do not know it but on the West Coast, the senior credit administrators of the 12 largest banks in the West met twice a year to “help each other” improve their mutual credit skills and to provide a check and balance against credit quality deterioration drift. We actually reviewed the delinquency and loss numbers of each of the other banks. (we were careful to avoid anti-trust conversations on pricing, etc.)
Most of those banks are merged out of existence. That is one reason why the consumer credit quality drifted into chaos. It is the reason that “payday lending” and Vigorish are entering into the banking world today. With banks like, Wells, US Bank, Regions, Fifth-Third entering into 150% plus interest games, TRUST will be gone forever!