Banking Tech News Highlights for March
The banking industry witnessed significant tech-related developments in March, ranging from cryptocurrency proposals to data breaches and fintech innovations. Here’s a summary of the key events:
Fintech Innovations
Neobank Chime has introduced ‘Instant Loans’ — three-month installment loans of up to $500 with fixed interest rates and no credit checks for members who directly deposit their paychecks into Chime accounts. Eligibility is determined through Chime’s proprietary method, considering factors beyond credit history. On-time repayments will help customers build credit history.
Cryptocurrency and Regulatory Developments
President Donald Trump’s proposed cryptocurrency reserve drew industry attention, with the inclusion of five different cryptocurrencies sparking skepticism. Crypto leaders like Coinbase CEO Brian Armstrong suggested focusing on bitcoin as ‘digital gold.’
Data Security Concerns
Western Alliance Bank reported a data breach affecting nearly 22,000 people, exposing sensitive information including names, Social Security numbers, and financial account details. The breach occurred between October 12 and October 24 of the previous year and was discovered on January 27.
Fintech Partnerships and Challenges
The relationship between fintech company Mercury and its banking partner Evolve Bank & Trust ended, with Mercury migrating to new partner banks. This move follows similar changes by other Evolve partners after the bankruptcy of Synapse, a middleware provider.
Emerging Technologies in Banking
Palantir, backed by Peter Thiel, has partnered with TWG Group to create a joint venture focused on increasing AI adoption in financial services. The venture combines Palantir’s AI and cybersecurity capabilities with TWG’s technology experience.
Regulatory Changes
FinCEN has lowered the threshold for reporting cash transactions near the U.S.-Mexico border from $10,000 to $200, aiming to combat drug trafficking. This change affects money services businesses in specific ZIP codes in California and Texas.
Industry Challenges
Banks continue to express dissatisfaction with their core technology providers, citing difficulties in finding the right fit despite gradual improvements in satisfaction levels. The American Bankers Association highlighted the critical role of core providers in deploying modern banking tools.
Cybersecurity Landscape
The potential end of U.S. cyber offensive operations against Russia may impact the intelligence gathered on Russian cyber threats, potentially compromising threat information for U.S. banks and critical infrastructure.
Commercial Card Trends
Commercial card spending is predicted to rise significantly, presenting opportunities for banks. Experts suggest commercial cards could be particularly useful for larger payments currently made via ACH.
