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Merchants Prepare for Over $40 Billion in Returns [2023 Update]

Not everyone is always thrilled with their Christmas gifts, and now that we can shop for anything we want with relative ease and next to no effort, so too can we return items.

Holiday Record E-commerce SalesYear on year, Christmas shopping habits are growing and the dollar amount consumers spend is on the rise. It’s only inevitable that so too should returns increase. This is why this year, merchants are expecting to refund a whopping estimate of $41.6 billion worth of merchandise bought online. At least this is what a study undertaken by the commercial real estate services firm CBRE is estimating, along with their partner Optoro, which specializes in assisting merchants when it comes to processing returns. The projection for 2018 was $37 billion, so this is a pretty hefty increase which would make for an all-time record.

By assuming that, on average, around 15% to 30% of all online purchases are returned, CBRE and Optoro can calculate the return figure. By contrast, old-fashioned brick and mortar store shoppers return around 13% of their purchases.

An Early Start to Online Returns and High Volume

CBRE and Optoro’s report also states that each year, the return rate in the retail industry grows by around 10%, and up from last years $90 billion, this year’s overall cost of returns, both online and in-store, is predicted to reach upwards of $100 billion.

In other areas, USPS is expecting to handle over 1 million returned packages each day of the Christmas period, with its peak hitting on January 2nd with 1.9 million items, over 26% higher than the peak so far in 2019.

CBRE Matt Walaszek Report

According to associate director of industrial and logistics research at CBRE Matt Walaszek, “[The Christmas period is] a time when retailers are seeing all these sales and that does not translate into rising profit margins. However, the returns are quite costly. The costs are the number 1 stressor for the retailers.”

Inefficient methods for handling returns costs the retail industry around $50 billion each year, according to Optoro. Also, with over 10 billion “needless shipments” each year, costs really are adding up for retailers. Often, retailers aren’t able to resell returned merchandise themselves, so one tactic is to try to sell the merchandise to discount stores. Failing that, merchandise has to be destroyed, which, along with the $50 billion in costs each year, generates 5 billion pounds of waste.

Continuing on from what he said before, Walaszek added, “Customers have gotten really accustomed to free returns. We are really spoiled. And retailers have to figure this out to be able to compete in this marketplace.”

Conclusion

Christmas retail sales are expected to rise around 3.8% to 4.2% this year, which would see sales between $727.9 billion and $730.7 billion. With all these increases in sales, money lost through returns is only going to continue to increase too.

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Google Comes Under Scrutiny for Acquisition of Cloud Data Science Firm

Just one week before Christmas, the Competition and Markets Authority of the United Kingdom made an announcement that may have played a part on shares of Alphabet, the parent company of Google, losing nearly 3% on the Nasdaq. Usually, announcements related to information security issues tend to have an immediate effect on company stock, but such is not the case with the British CMA; the problem is related to Google’s acquisition of Looker Data Sciences, a data visualization platform headquartered in California.

According to a news report by the Associated Press, the CMA became interested in the aforementioned acquisition in early December with an enforcement notice. The concern was that the merger would make consumers think of Google UK and Looker as indistinct business entities; in other words, there are valid concerns that integrating Looker would unfairly make Google the most attractive choice for business owners and individuals looking for cloud computing services, particularly with regard to website and application hosting.

Let’s say an e-commerce fashion entrepreneur in London is looking for a platform where she can set up her online boutique. She wants bandwidth, security, a shopping cart, a digital payment solution, and visual reports of website traffic as well as transactions. After acquiring Looker, Google will probably be the most attractive cloud hosting option for this e-commerce entrepreneur because she thinks Google is providing everything all the way down to data visualization. In this example, it is easy to see the CMA concern because third-party data visualization companies would not stand a chance to compete against Google.

The CMA will have from now until February 2020 to update the public on this matter. Google began taking over Looker in June 2019 and has thus far obtained regulatory approval in the United States and Austria. It should be noted that the UK is still part of the European Union, so other nations could very well start looking at this acquisition deal for signs of anti-competitiveness. In the U.S., Google is one of various technology giants being investigated for what state and federal regulators may consider antitrust activity; interestingly, one of the aspects of these investigations focuses on digital payments, particularly popular platforms such as Apple Pay and Google Pay.

Former PayPal COO is New Google Commerce Chief

Back in June of this year, PayPal made the announcement that COO Bill Ready would be stepping away from his long tenure at the online giant, and we now know precisely why. This coming January, Ready will be stepping into a new role with Google as their new commerce chief, a position from which he will be reporting directly to Prabhakar Raghavan, Google’s Senior Vice President of Engineering.

New Google COO From PayPalHaving joined PayPal in 2013 after their purchase of his payment gateway startup Braintree for $800 million, Ready saw himself moving steadily up the ranks before becoming PayPal’s EVP and COO in 2016. While working in this role at PayPal, Ready was responsible for overseeing product, technology, and engineering, along with PayPal’s merchant, consumer, Venmo, Paydiant, Braintree and Xoom businesses’ end-to-end experiences. On top of this, he co-chaired PayPal’s revenue and profit-focused Operating Group. Today, businesses such as Uber, Facebook, Jet.com, and Airbnb rely on Braintree to power all of their payments.

Many of PayPal’s biggest moves as a company can be traced back to Ready’s tenure, such as the introduction of PayPal One Touch (their most rapidly adopted product of all time), PayPal Commerce, the expansion of Braintree’s global reach, Pay with Venmo, and the redesign of PayPal’s mobile app.

When speaking with regards to Ready recently, Raghavan said “Bill’s exceptional track record building great experiences for consumers and deeply strategic partnerships makes him a powerful addition to our team. I couldn’t be more excited for the future of commerce at Google.”

Ready himself followed this up, saying, “I’ve long admired how Google has enabled access to the digital economy for everyone/ Google has been making world-class commerce capabilities universally accessible to partners of all sizes, and I look forward to furthering that mission.”

Bill Ready’s role as Google’s new commerce chief won’t see him getting directly involved with anything to do with the payments side of the business, PayPal’s competitor Google Pay, but it will instead see him focusing on leading the vision, strategy and delivery of Google’s commerce products. While not directly involved in payments operations, he will, however, be working in close partnership with them, along with Google’s advertising operations.

Being in charge of commerce at Google will be no easy task for Ready, in part due to the nature of the close proximity to advertising, which is parent company Alphabet’s largest source of income. Out of a total revenue of $40.5 billion, Google’s ad revenue in Q3 of 2019 alone was $33.29 billion.

When making a statement with regards to Google’s hiring of Ready, CEO of Google and Alphabet Sundar Pichai stated, “I’m thrilled to welcome Bill to Google as we continue our work to create more helpful commerce experiences and build a thriving ecosystem for partners of all sizes.”

Grow Your Merchant Services Agent or ISO Business

In the competitive world of merchant services ISO, you need to leverage every aspect of your skillset, your schedule, and your merchant servicer to grow your business. Independent sales organization (ISO) agents have the potential to make a significant income – but only when they stay focused and disciplined. Follow these steps to grow your ISO business:

1. Find the Right Partner

Customized Merchant ServicesSign on to a processing partner where they provide outstanding training and support. You’ll need to not only learn their products inside and out, but you’ll also need marketing tools to get the word out. Your partner’s customer service has to be there for your merchants – otherwise, you know who will also be customer service. And, of course, they need to pay you what you deserve with expediency and transparency.  This is even more important in the current climate.  You want a partner that is going to find ways to help you win new business and to close every opportunity.  With options for physical prospecting being more limited, a partner like Host Merchant Services can help you find new customers and win a higher percentage of new opportunities.

2. Know Your Product

Now that you have your merchant services partner with all of its training, take advantage of it! Learn your business so thoroughly that you can turn around and educate your current and potential merchants. Not only will your knowledge build your confidence, but it will increase your sales. Merchants want to work with credit card processing agents who can expose them to new trends and products, as well as explain to them the details of fees. Understand what merchants are looking for now, and how that may have changed over the last few months. Merchant needs in 2020 are not the same as 2019. Many are looking to survive, and programs such as reducing monthly fees and costs might be very attractive. But merchants also need to adapt, so online ordering and new business tools may be the right angle to win new business. Know your prospective customer and partner with Host Merchant Services to meet their unique and changing needs.

3. Stick to a Schedule

Make a plan and stick to it.  How can you demonstrate and provide value to your prospects?  Plan your day and stick to your schedule. Understand how the landscape has changed and phone and email may replace some of your in person prospecting.  Make appointments by phone, as merchants may not be as receptive to surprise visits. Just understanding when your prospects are open and how their businesses have changed can be an important first step to forging a lasting relationship.

4. Decision Point

When visiting with merchants, your aim is to create a decision point, not make a sale. If a merchant eventually decides to make a switch in merchant service providers, they will choose you because you triggered the need for their business. Don’t underestimate the power of planting the seed. And remember this when you’re feeling like you’re not getting anywhere. You’ve already done the work. Keep following up and be patient. Persistence matters now more than ever, and if you build relationships you will be top of mind when merchants are ready to make a switch.  Maybe they aren’t ready today, but when they are ready you want to be the first person they think of.

5. Special OffersExcellent Merchant Services Customer Support

Always have a special offer on hand when meeting with merchants. Create a limited time offer. Sometimes cash back or reduced monthly fees can work for small cash-strapped businesses. If they qualify, remind them you can provide a free terminal or other equipment. Maybe you’re providing a new technology that is alleviating a pain point or streamlining operations. When you’re demonstrating how much you can save their business, always multiply the savings by 12 to show them their annual savings.

6. Social Media

Take advantage of social media, especially now when it’s free or very cheap to advertise. Connect to your entire network, including friends, family, and colleagues on LinkedIn and build upon your presence by posting articles, commenting on discussions, and joining groups. Facebook and Instagram advertising are still relatively inexpensive. In addition to building your business profiles on both sites, post frequently for free, and test out their paid advertising. Leverage your current personal and professional network on all social media sites to grow your online presence and attract new merchants to your business.

7. Retention & Referrals

Keeping a merchant is a lot easier than finding a new merchant. While it is great to have a reliable partner like Host Merchant Services to support you, don’t rely on that entirely. Follow up with all of your current merchants, and while you’re at it, ask them for referrals. Make it part of your routine to schedule a meetings with your merchants. It’s a valuable aspect of your business and helps build long term value in your merchant portfolio.

Host Merchant Services & Merchant Services Agents

Host Merchant Services equips its merchant services agents and ISO’s with the tools necessary for success. We approve your deals quickly, never leaving your merchants waiting. Once your merchant is signed on, HMS further supports our agents with our top-rated customer service. We make PCI compliance a quick and easy process for both agent and merchant. 

HMS, with its account management portal provides unmatched transparency into residuals, allowing HMS to pay its ISO sales agents on-time and accurately. And with online reporting and marketing support, HMS helps agents track merchants and activity, as well as help agents build skills to further grow their business. HMS and its agents are in a position to offer a wide range of products and services to merchants, including the elite Bonsai Point of Sale, Clover, Vital, and much more. Host Merchant Services supports its agents and their merchants in every way possible.  With the current business landscape and challenges facing merchants in 2020, choosing the right partner – Host Merchant Services – can make an even bigger impact on setting your business on a path for success.

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How Should I Choose a Credit Card Processor for My Restaurant?

Because restaurants operate on thin profit margins, restaurateurs must leverage every payment type to attract every type of customer while simultaneously leveraging the support of their credit card processor. Business owners don’t have time to waste on deciphering complex credit card processing fees during their monthly reconciliation. Nor do they have the luxury of refusing payment types in the digital age when customers are trying out every new payment trend available. Restaurants must weigh several factors in choosing a merchant service provider.

Great Customer Service

Restaurant paying bill with cardThe owners and employees of restaurants are in the business of customer service. Their priority is creating the best dining experience possible for their clientele. They can’t be bogged down with complicated point of sale technology that slows the process and frustrates the end user. If they do experience technical challenges, they need support pronto in a 24-hour business cycle.

Knowledgeable Point of Sale Support

Restaurants have unique business needs regarding their credit card processor. In addition to round-the-clock support, a business needs restaurant merchant services that offer solutions that fit various business models. Depending on the restaurant, point of sale solutions may need to accommodate both a traditional style of service, as well as catering service and beyond, including mobile flexibility to allow a restaurant to meet the customers in multiple locations under a variety of circumstances.

Point of Sale Options

A restaurant needs a payment processor that can synchronize current processing systems with their solutions or provide a whole new solution to fit the restaurant’s circumstances. Keeping both security and convenience in mind, restaurants need a merchant service provider that can help the business to accommodate as many customers as possible in a secure fashion while also making transactions easy for restaurant owners and staff.

Low Rates & Transparent Pricing

And while customer service, ease of use, and processing simplification are ideal goals for a restaurant, none of it matters if the cost eats into the restaurant’s profits. Restaurants need a merchant service provider that offers interchange plus pricing, the pricing model merchants can rely on to offer the lowest cost interchange fees on the market. With a low markup over the wholesale cost, the interchange plus pricing model provides flexibility in equipment and payment options while keeping costs as low as possible.

Host Merchant Services: What Your Restaurant Needs in a Payment Processor

HMS provides customer support for restaurant credit card processing 24 hours a day, 7 days a week, 365 days a year. We know we need to work as much as you do to properly support an industry that can operate nearly 24 hours a day. That’s why we have operators standing by to answer your call any time of day.

HMS also explains how payment processing works. Providing a comprehensive package including credit card processing and financial transaction services to restaurants, we will custom design a flexible credit card processing solution to fit the needs of your restaurant.

And when we do demonstrate your payment processing scenario selections, HMS also offers your restaurant several point of sale options, including Clover, Vital, Bonsai, SwipeSimple, and more to fit your specific operation. If your restaurant is already equipped with hardware, HMS provides an easy point of sale integration. 

Whether you need an entirely new point of sale system or a solution for your current system, HMS offers a suite of services to suit your restaurant’s needs. From wireless equipment, payment by check, recurring billing, to online payment gateways, HMS has everything a restaurant needs for serving customers in both traditional sit-down establishments and catering services. 

With our low rate guarantee, HMS provides a Free Rate Analysis to show where you can save on your restaurant payment processing. If HMS can’t save your restaurant money, we will give you a $50 Gift Card. The best pricing model on the payment processing market, Interchange Plus Pricing will help your restaurant’s bottom line. 

Host Merchant Services will even provide your restaurant free equipment via our free equipment program to qualified merchants along with receipt paper at wholesale prices. We are your restaurant’s credit card processing solution.

Frequently Asked Questions

  1. What factors should I consider when choosing a credit card processor for my restaurant?

    When selecting a credit card processor for your restaurant, consider factors such as transaction fees, processing rates, contract terms, and equipment compatibility. It’s also important to assess the processor’s reliability, customer support, and security features. Ensure that the processor can handle the volume of transactions your restaurant typically processes and offers features like tip adjustments and split payments to accommodate your needs.

  2. How do transaction fees and processing rates impact my restaurant’s profitability?

    Transaction fees and processing rates can significantly affect your restaurant’s bottom line. Higher fees or rates can eat into your profits, especially if you have a high volume of credit card transactions. Compare the fee structures of different processors, including flat-rate pricing, interchange-plus pricing, or tiered pricing, to determine the most cost-effective option for your restaurant’s transaction volume and average ticket size.

  3. What should I look for in terms of contract terms and hidden fees?

    Carefully review the contract terms and conditions offered by credit card processors. Look for transparent and flexible contract terms without long-term commitments or early termination fees. Be cautious of any hidden fees, such as statement fees, PCI compliance fees, or monthly minimums, as these can add up over time and impact your restaurant’s profitability.

  4. How important is equipment compatibility for my restaurant’s credit card processing?

    Equipment compatibility is crucial for smooth credit card processing in your restaurant. Ensure that the processor’s hardware and software options integrate seamlessly with your point-of-sale (POS) system. Consider whether you prefer traditional countertop terminals, mobile card readers, or online payment gateways. Assess compatibility with contactless payment methods like NFC and digital wallets, which are increasingly popular among customers.

  5. What role does customer support and security play in selecting a credit card processor?

    Customer support and security are vital considerations when choosing a credit card processor. Look for processors that offer 24/7 customer support to address any technical issues promptly. Additionally, processors that prioritize data security, comply with Payment Card Industry Data Security Standard (PCI DSS), and provide advanced fraud protection measures. Protecting your customers’ payment information is essential for maintaining trust and avoiding potential liabilities.

Related reading on choosing a credit card processor for your restaurant: Restaurant Payment Resources.

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How the New Colorado Digital Driver’s License Works

The United States is one of about a dozen countries without a mandatory national identification document; for this reason, driver’s licenses, state ID cards, passports, and even social security numbers have served as alternatives to a federal identification system that both conservatives and liberals cannot seem to agree on. Starting in October 2020, the Real ID Act will come into full effect, and this digital coordination of personal information currently managed at a state level will be the closest Americans will get to national ID card, at least for the time being.

New Mobile Digital IDIn Colorado, a state known for its friendly attitude towards technology, both driver’s licenses and state-issued ID cards are going fully digital. In an interview with the Wall Street, Colorado’s Chief Information Officer Theresa Szczurek explained that a mobile version of driver’s licenses is like a “killer app” for state residents in the sense that it takes away the burden of having to carry a wallet. This new form of ID is actually a feature of myColorado, a comprehensive mobile app that grants residents access to a variety of services provided by the state.

The philosophy behind this digital ID project comes from the growing trend of Americans never leaving home without their smartphones. If a woman in Denver goes out to walk the dogs, she is unlikely to bring her purse, wallet, or pocketbook, but she will very likely bring along her smartphone. Speaking of Denver, this is a city where 20% of retail payments are made with mobile devices. By order of Governor Jared Polis, most Colorado state agencies have been ordered to accept this electronic ID as a valid form of identification, and this is already being used by a few commercial establishments that need to check ID for various purposes such as selling cigarettes, serving liquor, or verifying a point-of-sale purchase made with credit cards.

The myColorado driver’s license automatically links with the databases managed by the Department of Motor Vehicles. Changes personal information can be updated through the myColorado app, and this includes taking selfies. A Colorado driver’s license is typically good for five years, and for many residents who change addresses two or more times during that period, this means many trips to the DMV. With the new electronic ID version, changes can be made directly from smartphones 24 hours a day and even on weekends without worrying about taking time off from work to stand in long lines at DMV offices.

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Wearable Devices Are Becoming More Attractive as Digital Wallets

The cashless paradigm has gone from credit and debit cards to smartphones, and the next logical step appears to be wearable devices such as smartwatches and fitness trackers; however, it should be noted that wearable digital payment systems do not necessarily need to be part of smart devices. In early 2017, market research firm Tractica issued a forecast that suggested more than $500 billion worth of wearable retail transactions will be made in the year 2020; nonetheless, a more recent estimate by MasterCard Europe revises this projection closer to a billion dollars.

Contact-less payments technologybest mobile payment options is at the heart of this wearable digital wallet revolution, which is powered by Radio-Frequency Identification (RFID) and Near-Field Communications (NFC). These solutions are not exactly new; in the United States, RFID key fobs were marketed to drivers about a decade ago for the purpose of facilitating the process of paying for fuel purchases right at the pump. NFC payments were initially designed almost exclusively for smartphone, but smart wearable devices such as the Apple Watch, which links with the iPhone and the iPad, are making more sense as digital wallets.

MasterCard has a good reason to follow the wearable payments segment; the debit and credit card giant has a good opportunity to catch up to its rival visa in terms of global market share through wearable devices, which are not limited to smartwatches. Consumers who do not particularly care for smartwatches and prefer more traditional analog and digital versions can get watch straps equipped with contact-less payment technology, and MasterCard wants to be the primary processor in this regard. The company started working with luxury watchmakers in Sweden and Switzerland about a year ago, but MasterCard has recently struck partnerships with manufacturers of aftermarket watch straps to give more consumers the ability to pay with accessories they wear.

Mobile point-of-sale transactions are taking hold in Asia and Europe more so than in North America. At European brick-and-mortar stores, 61% of transactions are already contact-less, and about 16% are made with wearable devices. One aspect of wearable devices that is resonating with consumers is that many of them coming on the market are of the passive kind, which means that they do not rely on smartphone batteries to operate; this technology has been around since the key fob days, and it is regaining interest as an alternative to mobile devices such as smartwatches and smartphones, which only allow digital wallet transactions as long as their batteries will last.

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PSCU Prepared for Contactless Cards Growth in 2020

With a predicted rush in 2020 for more merchants and customers to jump onto the contactless payment cards bandwagon, PSCU announced earlier this week that they are fully prepared to handle whatever will be coming their way over the following year.

Contactless Credit Card PaymentsHaving already rolled out more than half a million NFC (Near Field Communication) enabled cards via natural reissuance to members amongst 14 owner credit unions, the credit union service organization (CUSO) PSCU anticipates that they will be distributing in excess of 3 million new NFC enabled cards throughout 2020 to more than 100 credit unions.

By keeping themselves ahead of coming payment innovations, PSCU can help to ensure that its owner credit unions members’ accounts are most frequently used, and by offering NFC enabled cards to owners, Jeremiah Lotz, managing vice president of digital experience and payment products at PSCU said, “We help our credit unions achieve top of wallet status” as the adoption of tap to pay solutions continues to rise.

The second yearly Eye on Payments study by PSCU has shown that 25 percent of respondents make transactions with an NFC enabled card a few times per month. They have cited reasons such as ease, convenience, speed, and security, while non-users stated that the stores they frequent aren’t as of yet accepting NFC enabled card transactions.

With an ever-increasing number of merchants each year opting into NFC technology and accepting NFC enabled payments, it’s believed that more consumers will begin to adopt the technology and participate. As many as 95 percent of all payment card terminals feature NFC enabled capabilities, according to Visa, and as of October 2019, 80 percent of the top 10 merchants were accepting NFC transactions.

Jeremiah Lotz has also stated: “Credit unions should be prepared to not only offer contactless cards to their members, but also have information readily available to educate members on how to use these new payment methods and ascertain whether a merchant’s point of sale terminal is contactless enabled.”

The PSCU’s original model is scale and collaboration, and for more than the past 40 years, the company has leveraged its influence on behalf of credit unions and their members. To this day, PSCU provides an end to end competitive advantage that helps to enable the secure growth of credit unions, making sure that they are able to meet ever-evolving consumer demands.

Frequently Asked Questions

  1. What are contactless cards?

    Contactless cards, also known as tap-and-go cards, allow users to make payments by simply tapping their card on a contactless-enabled payment terminal. They use radio frequency identification (RFID) technology to transmit payment information securely and quickly.

  2. How did PSCU prepare for the growth of contactless cards in 2020?

    PSCU, a leading credit union service organization, ensured its member credit unions were ready for the surge in contactless card adoption. They worked closely with partners to upgrade payment terminals, implemented fraud detection measures, and educated credit union staff and members on the benefits and usage of contactless cards.

  3. Are contactless cards secure?

    Yes, contactless cards are secure. They use advanced encryption technology to protect cardholder information during transactions. Additionally, contactless cards have built-in security features, such as transaction limits and authentication requirements, to prevent unauthorized use.

  4. Can I use my contactless card everywhere?

    Contactless cards can be used at a wide range of merchants and payment terminals that support contactless payments. Look for the contactless symbol on the terminal or ask the merchant if they accept contactless payments. If the terminal is not contactless-enabled, you can still use your card by inserting it into the chip reader or swiping it.

  5. How do I know if my card is contactless?

    Contactless cards typically have a contactless symbol on the front or back of the card. This symbol looks like a sideways Wi-Fi icon or four curved lines. If you’re unsure, you can also check with your card issuer or refer to the card’s documentation.

  6. Can I disable the contactless feature on my card?

    Yes, most card issuers allow you to disable the contactless feature on your card if you prefer not to use it. Contact your card issuer’s customer service or use their mobile app or online banking platform to manage your card settings and preferences.

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A Digital Version of the Dollar Will Take Longer Than Expected

In the world of cryptocurrencies, Bitcoin is the leading token in terms of circulation, but this has a lot to do with being the most valuable digital asset, which means that most transactions are related to speculative trading and investing. Ripple, a centralized digital currency that trades under the symbol XRP, gets more circulation than BTC, but mostly in the remittances and international money transfer arenas.

Bitcoin Online E-commerce CryptocurrencyThere are two emerging cryptocurrencies making a circulation splash, and they share one factor in common: their value is tied to the United States dollar. Tether (USDT) and U.S. Coin (USDC) are known as “stablecoins” which means that their currency exchange value will always be the same as the American dollar because this is the business plan of their respective development teams. In the case of USDC, which is backed by investment banking giant Goldman Sachs, its market capitalization has increased considerably this year because users of this digital currency enjoy its stability and trust in Goldman Sachs as the manager of the underlying blockchain.

With the profile of stablecoins rising, it stands to reason that the U.S. Treasury could soon develop a digital version of the greenback, but this is not likely to happen as long as Chairman Jerome Powell leads the Federal Reserve Bank. Powell recently sent a letter to Congress for the purpose of answering questions related to cryptocurrency use, and it was clear that Powell does envision a sovereign blockchain for the USD.

It should be noted that the Russian central bank has already developed a digital version of the ruble, and a similar approach has been taken with the Singapore dollar. As of October 2019, the Eastern Caribbean Dollar was undergoing a digital pilot program to test if going cashless is in the future of various island nations. These three digital currency projects are based on the open-source Ethereum blockchain, and they are being monitored by American financial regulators, but there does not seem to be an interest in emulating projects.

Powell’s letter to Congress included his opinion of the American banking and payments systems, which he thinks are advanced, secure, dynamic, inexpensive, and robust; this opinion was clearly meant to underscore why the Fed Reserve Chairman does not think a crypto-greenback is needed, but those who work in the U.S. payments industry know that this is not the case. Asia and Europe are the leading markets in the digital payments arena, and a major reason why the American market lags behind is because of inflexible financial and banking regulation. Refraining from testing the waters of digital currencies will only make the U.S. less competitive in the global payments arena.

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Apple Launches Express Transit Payments For Commuters

Technology giant Apple is trying to get the most functionality out of the iPhone before the next chapter of personal and portable computing is written. Subscription-based services, digital content, and mobile payments are some of the verticals that Apple has been exploring for the purpose of squeezing more profits from the iOS ecosystem, and this includes enabling commuters to pay for bus or metro fares with their iPhone or Apple Watch devices.

ApplePay Mobile Transit PaymentsAccording to a news report by the London Evening Standard, Apple Pay has officially gone underground with its new Express Transit feature. Although the ability to use Apple Pay for London tube fares is not exactly new, this method used to require biometric authentication in order to complete the transaction. What this meant for London commuters was getting stuck behind fellow tube riders trying to figure out the Apple Pay FaceID or TouchID systems; we are talking about wait times of up to 30 seconds during rush hour. With Express Transit, Apple is going the more traditional and faster route of contact-less payments supported by Android Pay.

To enable Express Transit, which is available on iPhone models starting from the SE all the way to the 11 Pro, users should tap the Settings icon and visit their Wallet and Apple Pay section where they will find the new Express Transit feature. Setting this up is as easy as selecting the desired payment card; if you have an Apple Card, it will become the default payment method for fares in the Transport for London system. Although Apple has only mentioned the London underground in its Express Transit announcement, any of the yellow card and device readers installed at railway stations all across the United Kingdom will work.

It should be noted that Express Transit works with the Apple Watch, and this is probably the most convenient way to handle mobile payments because of the wearable factor. Needless to say, Express Transit devices must have the latest version of iOS or WatchOS to work properly. This new Apple Pay feature is not only a time-saver but is also more in line with the direction the mobile payments segment is taking. Express Transit was previously launched in the Metropolitan Transit Authority of New York City, but Google Pay is found in even more public transportation systems around the world.