🔥 Everyone is disrupting the payments market

May 31, 2021

Also:

  • 💳 Payments in Norway

  • ⌛️ Buy Now – Pay Later globally

  • 🏦 Central Bank Digital Currency

  • 🎰 Robinhood «democratizing» IPOs

  • 👴 How to do long term

🔥 Everyone is disrupting the payments market

This week we've read a lot about everyone trying to disrupt the payments market:

  • Shifter has written about Tillit, which solves the mismatch of SMBs wanting invoices, but most websites support card payments. The market for e-commerce between companies is 30 billion NOK in Norway alone. Link

  • Packy McCormick has written about Melio, which simplifies how SMBs pay to each other. This is an issue in the US where they don't have standards like PEPPOL (EHF in Norway) which we have in Europe. The market for B2B payments is $10 Trillion in the US alone. Link

  • Last week, Stripe launched "Stripe Payment Links." You can create a payment page in a few clicks and share the link with customers without coding anything. The payment link space originates from Nigeria, India, and the Philippines, where this is more common, but this feature will also be huge in the no-code community. Link

💳 Payments in Norway

Last week Norges Bank launched Payments statistics from the previous year. Here are some numbers we found interesting:

  • 65% (1,2 billion) of all physical payments in Norway was done contactless in 2020.

  • 14,2 million contactless payments were made with mobile or smart watch (like Apple or Google Pay). That's ~ 1,2% of all contactless payments.

  • 13% (59,1 million) of Internet Payments was done with mobile payment solutions like Vipps, Apple Pay, or Google Pay.

  • There is a decrease in mobile and online banking payments because Vipps has taken a large part of transfers between private individuals.

  • Read the whole report here

⌛️ Buy Now – Pay Later globally

Last week we wrote about how BNPL needs regulation in Norway. Regulation could be good news for users that takes on too much. But regulating BNPL could also mean bad news for the overall user experience when you are paying. BNPL would then fall closer to traditional financing like credit cards and thereby need to collect more information about you if you want to pay later. That would be the end of just typing in your phone number to buy anything. This week we came over two deep dives into the BNPL space internationally:

  • Seedtable did a deep dive into BNPL's pitfalls and challenges as well as Investors' appetite. Link

  • Fincog has written about the different actors globally, why BNPL has gained traction, and how it varies from country to country. Link

🏦 Central Bank Digital Currency

«Just as we moved from barter to metal, and from metal to paper, so we are now moving from paper to little pulses of electricity.»

  • A short primer on what CBDC is. Link

  • The Economist has written a report on CBDC, exploring the extent to which digital payments are trusted by consumers and what barriers may exist to basic monetary functions becoming predominantly electronic or digital. Link

  • CBDC-tracker: A map of today's Central Bank Digital Currencies Status Link

🎰 Robinhood «democratizing» IPOs

Last week Robinhood launched a new product, IPO Access, that will allow their customers to buy shares of companies at their IPO price before trading on public exchanges. Once again Matt Levine has written best about this:

The pitch to Robinhood's customers writes itself. In a hot IPO market, initial public offerings mostly go up. If you buy a newly public company at the IPO price, it will trade up the next morning, and you will make money. If you are a Robinhood customer, you want to make money. Also, though, you want a little bit of a gamble, something exciting, and buying shares of a newly public company is more exciting than buying shares of Apple Inc. or whatever. Also buying IPO shares is a bit of a lottery not only in that the company is new and untested, but also in that you don't know how many shares you will get: "Watch and wait," says Robinhood's blog, because "IPO shares can be very limited, but all Robinhood customers get an equal shot at shares regardless of order size or account value." You get a random amount of stock with a random value! How fun is that?

  • Robinhood on their IPO Access product Link

  • Matt Levine on Robinhoods IPO Access. Link

  • Robinhood's Big Gamble: In eliminating barriers to investing in the stock market, is the app democratizing finance or encouraging risky behavior? Link

👴 How to do long term

Long-term thinking is easier to believe in than accomplish. Most people know it's the right strategy in investing, careers, relationships – anything that compounds. [..] Long term is harder than most people imagine, which is why it's more lucrative than many people assume.

Morgan Housel has written about long-term thinking and how you can come to terms with it. This reminds me of Warren Buffet at the beginning of his career, only allowed people invested in him to withdraw money once a year to force long-term thinking.

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Marius Hauken, partner Stacc X