Klarna’s Great Buying Binge & Will FinTech kill the tooth fairy?

Issue 204 | 15 November 2021

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This week’s Payments:Unpacked is brought to you by Tanya Thourani with a FINCUTS feature on Klarna’s great buying spree.

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Klarna’s Great Buying Binge

With the explosive growth of the BNPL industry, it isn’t difficult to notice Klarna’s acquisition spree.

Should we pay attention?

BNPL accounted for 2.1% (about $97 billion) of all global e-commerce transactions in 2020. The sector is expected to keep growing to be worth $166bn by 2023, according to Worldpay and GlobalData’s thematic research.

It is clear that Buy Now Pay Later (BNPL) products are in high demand by both consumers and merchants amid the digital upheaval in financial services. Some credit to the pandemic, of course, that accelerated the growth of online shopping.

But BNPL does not stop here and what’s next?

Check out feature a FINCUTS analysis on Klarna’s acquisition spree prepared by Tanya Thourani - Klarna’s Great Buying Binge.

Scams Alert: We Can All Fall Victim to Social Engineering and Fraud

Fraud is a big burden for such organizations but there are of course other victims – people just like you and me. Their lives can be turned upside down and their finances ruined when they become victims of clever scam artists. Sometimes sympathy for them is in short supply, but social engineering is routinely used against all of us. We can all become victims of fraud.

Despite numerous studies and newspaper headlines informing us about the scams that fraudsters perpetrate, most of us don’t think we can easily be tricked into handing over money to criminals. FICO recently carried out a survey of 12,000 people in 12 countries. We asked them about the kind of financial crime that was worrying to them. Less than 7% of people said that they were worried about a fraudster tricking them into sending a payment. (For comparison, slightly more people were worried about a pickpocket stealing their wallet or purse and 31% were worried about a fraudster using information about them to takeover one of their financial accounts.)

Because people don’t feel they are vulnerable to social engineering techniques, education can be doomed to failure – why learn a lesson you don’t think you need? This is compounded by a feeling that scams happen to those who are vulnerable or in some way naïve or stupid.

The truth is that anyone can become a victim of a scam. Sarah Rutherford at FICO is currently reading, The Psychology of Fraud, Persuasion and Scam Techniques, which opens with author Martina Dove explaining how she too fell victim to a purchase fraud.


To click or not to click... The battle to keep mobile bill payments safe for data

Roundtable: 1pm GMT - 23rd November 2021 - An Expert Panel Discussion Sponsored by Answer Pay

Pay by link is growing in use within the financial services industry, as banks and other financial services companies adopt the mechanism in their apps to service growing demands for mobile payments.  But does that make sense when it encourages payers to click on links?

Google the term ‘pay by link’ and you will return a succession of promotions by providers suggesting this approach is useful, convenient and secure.

Tech leaders in banks and financial services businesses know there is an audience of buyers today that want to do everything on their mobile phone. For these mobile warriors, the smartphone in their pocket has become their primary computing device. In consequence, demands for mobile payments are on the rise. 

The solution for many app makers is pay by link.  It’s relatively straightforward to implement, and accessible too—but is it the right thing to adopt, when the information security industry has worked so hard to encourage consumers NOT to click on links?  And is there an alternative? 

Mike Chambers, Chairman of Answer Pay thinks it’s time the industry takes a closer look at the risks of pay by link to consumers before the ‘cat really does get out of the bag.’

With the best of intentions, banks and other financial services companies are enhancing their mobile apps to serve a growing demand for bill payments on the move. Pay by link is an obvious technical construct to explore to achieve that, but no matter how secure any given solution might be, the use of Pay by Link creates confusion for consumers who’ve been advised for more than a decade not to click on links. This industry direction places demands on the maturity and digital know-how of consumers to distinguish fake solutions from legitimate vendor tools and links.

The roundtable will be hosted by Phil Cracknell, former Cabinet Office Cyber Security Lead, and notable CISO advisor. Cracknell believes that the industry should be thinking hard about any decisions to adopt pay by link, regardless of the safeguards framed around it.

CTOs are under great pressure to bring bill payments to mobile platforms, but this ‘goldrush agenda’ by individual companies risks creating an industry behaviour that places consumers in an impossible situation.

Owing to the rampant growth in phishing attacks, security practitioners like me have been working tirelessly to discourage users to click on links that might not be safe. Now it seems we’re saying—‘You know how I’ve been advising you for years not to trust links, well some of them are now okay.’ I think it’s confusing and, my suspicion is, others would agree.


Register now at answerpay.uk/to-click-or-not-to-click-webinar or click here.

How Payments Can Keep Pace with Generational Changes

Digital technology has transformed every part of our lives, including payments. As many consumers desire efficiency and convenience, for businesses it can be difficult to adapt. In the latest edition of Payments Journal, Andy Stalsberg, chief commercial officer at Access PaySuite, discusses the importance of businesses keeping pace with new payment trends and how to adapt to consumers’ ever-changing requirements.

The payment space is continuing to evolve and we have seen a staggering amount of changes over recent years, with an ever-increasing amount of options available for consumers to choose how they pay.

It’s increasingly obvious that younger generations are driving these changes. PwC found that 70% of millennials believe that the way we make payments will be completely different in five years and 33% believe they won’t need a bank at all.

For businesses, how can they make sure they are still offering easy, secure and accessible payment options?

Andy explores:

  • Consumer behaviour

  • Subscriptions

  • Safeguarding consumers

More: How Payments Can Keep Pace with Generational Changes

Unlocking the power of corporate payments

The Payments Association are holding a webinar "Unlocking The Power of Corporate Payments". The webinar forms part of the primary research currently being undertaken by The Payments Association, sponsored by FIS, and will create an instructive guidebook on how to navigate the risks and opportunities for Corporate Payments in the UK and across the EU.

Taking place on Thursday 9th December from 15:30 - 17:00 GMT, the webinar will look at the changing Corporate Payments landscape and identify key strategies for future success.

Register: Unlocking the power of corporate payments

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In Brief


And finally…

Will FinTech kill the tooth fairy?

Chris Gledhill has been thinking about the tooth fairy:

I was explaining how fairies work to my daughter the other day. She had lost a tooth and so was due a visit from the tooth fairy. I’m not sure how widespread the tooth fairy tradition is in other cultures but in the UK if a child loses a tooth they can put it under their pillow at night and expect the “tooth fairy” to substitute the tooth for money. Children have far more faith in mystical things like fairies but my daughter is now of the age that she’s starting to question if there really is a tooth fairy or if it’s just daddy swapping her tooth for the £2 coin she finds the next morning. I explained to her that she’ll only be visited by the tooth fairy if she believes in her. Whether or not she still believes in the tooth fairy, she’s smart enough to keep her scepticism to herself and continue to benefit from the tooth/cash exchange!

More from Chris: Will FinTech kill the tooth fairy?

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