“Whilst not a huge fan of PayPal and it’s dinosaur UX, this offer from PayPal will annihilate the pop up players and their valuation bubbles that are so dependant on low interest rates and high fees. Online payday lenders be dammed” Ewan Walsh 2021This article is from the July 14 issue of The Australian Digital Edition. To subscribe, visit https://www.theaustralian.com.au/.
PayPal is throwing down the gauntlet to Afterpay and Zip in Australia, kicking off its own buy now, pay later service that avoids slugging customers with the late fees it labels a “huge bugbear” .
The much anticipated PayPal Pay in 4 launch on Wednesday came after the global payments behemoth earlier rolled out the service in the US, Britain and France.
PayPal is seeking to make a splash in this market by charging merchants the same fees it does for other payments and taking late fees completely out of the equation . It says it is the first to not levy late payment charges on buy now, pay later transactions in Australia.
This nation is the only market where late charges won’t be levied on customers that use the PayPal instalment payment option – an apparent strategy to gain customer traction in a market where Afterpay is dominant.
PayPal Australia payments general manager Andrew Toon said the local buy now pay, later option was designed in response to customer and merchant feedback , which showed late fees were a “huge bugbear” for customers.
“We’re doing this because we think it’s the right thing to do and it will deliver a better customer experience ,” he added.
Mr Toon cited research commissioned by PayPal involving more than 1000 online shopping customers which showed 55 per cent had not used buy now, pay later, with half of those noting they were “put off” by late fees.
“We are responding to that,” he said, declining to comment on whether the move was aimed at shaking up the competitive landscape .
“We support competition. It drives better outcomes for customers and innovation in the market ,” Mr Toon added.
The corporate regulator has also been concerned about the prevalence of late payments in the buy now, pay later sector. A report released last year found one in five users had missed payments, and a similar proportion have cut back on essentials like meals to make instalment payments on time.
Afterpay’s late charges sit at a maximum of $10 for purchases under $40. Above that amount they are capped at the lower of 25 per cent of the purchase amount, or $68.
Commonwealth Bank is also pushing further into buy now, pay later with a direct service called StepPay for existing customers, which will launch soon.
The bank has outlined late fees of $10 per missed payment, which are capped at $120 per year.
The PayPal buy now, pay later option doesn’t levy any sign-up fees or interest, but if customers are late on a payment their account is suspended until they rectify the situation.
“We take the view that custom- ers are missing payments by mistake and not design,” Mr Toon said, but he clarified that customers that perennially missed payments may see the service switched off altogether.
The other sore point about the buy now, pay later sector – largely from traditional lenders and consumer protection groups – is the lack of a credit assessment of customers . Afterpay, for example, does not assess a customer’s ability to repay the buy now, pay later purchases.
PayPal says it will conduct an assessment of customers they allow to access the BNPL soption, which is just one of several payment choices available online and through its digital wallet.
For PayPal’s more than nine million active Australian accounts , it will predominantly use its own data and analytics engine to assess suitability, while for new customers or to draw in additional information it will run credit checks through companies including Equifax.
“Suitability is assessed live, so that’s a real-time decision … we are only offering this to customers that we consider to be suitable and there are a number of elements that go into that decision,” Mr Toon said.
PayPal in March flagged its intention to launch the instalment pay option, at the time saying it would be available in Australia ahead of the end of financial year sales.
PayPal said regulatory issues it was confronting with local financial crimes regulator Austrac were not related to the launch of the buy now, pay later service coming weeks behind the initially flagged schedule. The company faces a real risk of enforcement action, including in court, after Austrac started a detailed investigation and assesses an independent report into hundreds of millions of potential breaches of the anti-money laundering laws.
The PayPal buy now, pay later service is available for purchases between $30 and $1500, with four interest-free payments. The lower threshold was reduced from an earlier flagged $50.
Merchants and businesses will pay the same fee to PayPal as they do for other payment services, which sits at 2.6 per cent of the transaction amount plus 30c.
PayPal’s global finance boss John Rainey, when he was asked about the pricing landscape in May, told investors that “competitors are probably going to have to move their pricing closer to where we are” .
In June, international reports had the company raising its merchant rates in the US for products like PayPal Checkout, Pay with Venmo, PayPal Credit and Pay in 4.
The Australian research commissioned by PayPal on attitudes to buy now, pay later was conducted by ACA Research.
Last month, PayPal said it was wading into the Australian credit card market – backed by Citibank
– to help facilitate in-store payments.
Copyright © 2021 News Pty Limited
Category Archives: Uncategorized
Media Calories. Nutritious or empty?
In challenging times we seek certainty or the illusion of same through information or data seeking.
Care is needed when consuming the junk food that media has become. The access to snack food (m and m commercial anyone?) packaged into convenient snippets, avoids the need to think at first glance.
On the road to finding certainty through consuming empty-media-calories, one can end the day feeling unsatiated.
#BeAwareOfTheAlgorithms
“Facebook should do everything in its power to prevent its tools and algorithms from driving people toward self-reinforcing echo chambers of extremism (which can) have dangerous (and life-threatening) real-world consequences.”
ref: Facebook civil-rights record hammered in own review
“Our algorithms exploit the human brain’s attraction to divisiveness,” read a slide from a 2018 presentation. “If left unchecked,” it warned, Facebook would feed users “more and more divisive content in an effort to gain user attention & increase time on the platform.”
“The high number of extremist groups was concerning, the presentation says. Worse was Facebook’s realization that its algorithms were responsible for their growth. The 2016 presentation states that “64% of all extremist group joins are due to our recommendation tools” and that most of the activity came from the platform’s “Groups You Should Join” and “Discover” algorithms: “Our recommendation systems grow the problem.”
What an interesting time we live in.
It’s Time to Reset Decision-Making in Your Organization
I found this interesting and so thought it worth sharing ….
https://hbswk.hbs.edu/item/it-s-time-to-reset-decision-making-in-your-organization
VUCA
“framework for thinking about the external environment that has gained traction in the business world is VUCA: Volatility, Uncertainty, Complexity, and Ambiguity.
While these words seem similar in many respects, a key point of VUCA is that each of these terms describes a different situation that requires a specific response. Nathan Bennett, a professor with the Robinson College of Business at Georgia State University, and G. James Lemoine, an assistant professor in the Organization and Human Resources Department of the School of Management at the University at Buffalo, have written extensively on VUCA, and argue, “If VUCA is seen as general, unavoidable, and unsolvable, leaders will take no action and fail to solve an actual problem.” Thus, diagnosis of the situation is a prerequisite to crafting a response.
They argue that
- volatility should be met with agility;
- uncertainty with information;
- complexity with restructuring (with internal operations reconfigured to address external complexities); and
- ambiguity with experimentation.
Track and Trace people OR identifying the spread of Coronavirus? – I think there is f&ck@ry afoot.
Yes, an app to help track the spread of any virus is a good thing.
But ….. Leave the “trace” bit out of the tech solution if the project sponsors are not prepared to deal with commonly understood consequences of bad design decisions that do not reflect the expectations society have on privacy and anonymity.
Just do the right thing. Its easy.
The trigger
This article. www.afr.com/news/politics/national/virus-tracking-app-being-designed-for-privacy-and-security-20200417-p54ktb
talks about storing people’s phone numbers on a database and using software to determine if one persons phone has been near enough to another person to register in the database.
(and another article.. This one is even more ‘worser’ https://www.abc.net.au/news/2020-04-20/government-insists-coronavirus-tracing-app-wont-track-locations/12163756 )
Yes the phone numbers might be encrypted and the uninitiated may believe that “encryption” will keep them safe from prying eyes.
So far, we’ll, sort-of-so-good…..
The problem is social, behavioural and political and to do with both privacy and anonymity protection. Our government agencies have a less-than-perfect track record to do with who has access to the keys to unlock the databases. They have employed senior people in the past that do not believe that citizens of a country have rights to do with privacy nor anonymity. Private data has been exploited and sold without the populations permission or knowledge. The world is full of bright peoples who have the job of joining these databases together to leverage for commercial gain. (It happens each and every day and is not abnormal in the advertising industry for example.)
The naïveté of these sorts of conversations lie in the notion that the app will “only be used for this purpose” and nothing else. History, common sense and logic shows us that this expectation is infantile. This approach to using phone numbers is unacceptable and by design, will decrease the numbers of people who trust enough to use it.
In Australia, we do not live in a society where government is authoritarian and governs via old school, command and control style. The CMO comments about compliance are not well thought out and illustrate just how out of touch some sectors are with how the world actually works.
The problem we are solving is identifying who needs to be tested and measuring how quickly this beast is passed on. That’s it. That’s all.
Ignore all these reporting requirements for this app: Geo spread, case stage tracking (immunised, symptoms, tested positive or negative etc), medico etc are all captured and reported on already. Stop listening to peeps who want it all wrapped up into one reporting tool.
Why does this matter?
If people don’t trust the proposed tracker then they won’t install it or use it or will simply leave their phone at home.
That will make this exercise another waste of time and money. It’s completely foreseeable.
Down the track, this data will be leaked to internal and external entities who will have absolutely brilliant justifications for why they should have access. This is both understandable and foreseeable but not acceptable.
A solution
No GPS nor device nor user nor other identifiable identifier. Not even in the database peeps. You know what I mean 😉
The tracker app has an CV19appID that is randomly generated, is unique and has zero ability to be unpacked to identify the device or person who downloaded the app at any stage by anyone.
The app connects to database with its intended ID and if it’s already taken then it creates another until it’s unique. No tracking on this process.
The app download procedure is unidentifiable. We just want everyone to download it.
The app does the Bluetooth handshake thing and exchanges the apps CV19appID with the other CV19appID that is on a nearby phone. No tracking other than to ensure it’s a unique interaction to avoid over or under counting.
Both phone apps upload into the database to indicate they were in physical proximity for the required time. (Random upload time window of zero to 24 hours?)
If another CV19appID has been in contact within the nominated window then their app says ” go get tested because this device was in close contacted for long enough to warrant you being tested”
The medical place that confirms the outcome of a test ( yes, home tests still need to be verified by sight, potentially at a pharmacy or at Dr reception) has a Bluetooth device for “positive” and “negative” and the test outcome for the CV19appID is uploaded to the cloud.
With some changes and challenges yes but that’s about it!
What it does not do
Users cannot enter their symptoms that the app can use to trigger a suggested action by the user. It is NOT the apps role to then be hijacked by the medicos for them to “streamline” some automated intake or stage management process. That’s the role of a different app that is not connected to the CV19appID identifier nor app. This is key.
Yes, we all know the argument.
If we don’t confirm who they are then how will we “know” for reporting purposes?
The answer: no one cares about your reporting. We care about helping ourselves and our friends and contacts to know if they might need testing. That’s it. Don’t listen to the reporting people’s “requirements”. They are not stakeholders in this opportunity to save lives and money.
We want effectiveness at this stage, not efficiency. Park that psychological driver for the moment and concentrate on the problem, the contagious nature of the beast, not the reporting peeps need for personal gratification nor interdepartmental “requirements” for justification via reports. ( phew it feels good to bring up #vanitymetrics again)
As always, am happy to be challenged and have my mind changed. DM me for that.
Again.
- App concept is good.
- Anonymity and Privacy are good.
- Do both.
- Why? Because we can.
Related stuff
Articles & Conversations that I find interesting in relation to CV19
28/03/2020 ~ David Lee
13/04/2020 ~ Insiders host David Speers
- The curve has flattened and now most Australians have changed the question they want answered
- ‘My sister will tell her oncology patients tomorrow that she recommends that they stop their chemo as a risks of a compromised immunity system combined with COVID-19 outweigh the benefits of chemo”
10/9/2020 – “Covid is just a virus behaving as viruses behave”
- a narrative supported by data. “Covid is just a virus behaving as viruses behave” is the position put forward. https://youtu.be/8UvFhIFzaac
Please send me links to articles that changed your thinking or that resonated with you.