Count me among those that believe that the G-20 is one of the better approaches to global governance in a world that desperately needs improved international policy coordination. While the G-20 has not gotten to where it could and should be, its periodic meetings provide us with important insights into global policy issues.
Ed: There follows a dissection of the G20 communiqué and the piece ends with:
I fear that all this may continue to catch off guard at least three dimensions that are still significant in today’s marketplace:
Mindsets that have difficulties recognizing regime shifts, preferring instead the illusionary comfort of the more familiar cyclical frameworks;
Approaches that focus excessively on rates of change and inadequately on levels; and
Investment portfolios that are over-exposed to equity and credit risk, and that maintain insufficiently hard interest rate duration.
In concluding, I would repeat what I said early yesterday morning when asked by a reporter
“What does the US jobs report mean for markets?”
” Investors should keep their seat belts on and tight.”
M-PESA customers to enjoy banking services on their mobile phones
[PESA meaning money in Kiswahili, so literally Mobile Money]
Nairobi based Equity Bank and Safaricom have launched an ultimate bank account that facilitates customers to transfer money to and from their M-PESA Equity bank accounts via their mobile handsets while enjoying other benefits that come with their bank account.
7.6 million Kenyans have bank accounts out of an estimated bankable population of 19 million.
This new service will push the banking frontier to reach out to the unbanked population by enabling Kenyans with mobile phones to easily open bank accounts.
Speaking at the launch Safaricom Chief Executive Officer Michael Joseph said
“M-PESA is proud to launch another new initiative with our partners Equity Bank by offering a new service that will target customers who are looking for the convenience of a bank account that uses M-PESA as the tool to deposit and withdraw money into their accounts. This is a great idea that will drive customers to save money into their bank accounts and enjoy the benefits of having the added value services of both M-PESA and Equity Bank account”.
This new innovation gives an opportunity to all unbanked Kenyans with mobile phones to enter the financial system and enjoy the freedom of modern banking. It is a revolutionary step in demystifying banking and making it easy for every Kenyan to keep their money in a safe and secure place.
Equity Bank’s Chief Executive Officer, Dr James Mwangi said
“This partnership marks the convergence between banking and telecommunications which will indeed take financial services to the last mile. Our partnership symbolizes how brands can maximize on their synergies to develop solutions that will hasten Africa’s development agenda. Technology is one of the key agents that will drive economic growth by introducing convenience and efficiency to empower ordinary citizens to become agents of poverty eradication. This is in line with our vision of championing the social economic prosperity of the people of Africa.”
The launch of M-KESHO is in response to identified M-PESA customer needs for a convenient and affordable to keep their money that they can access through agents including Equity Bank auto branches (ATMs).
[Kesho meaning “tomorrow” in Kiswahili, so literally Mobile Savings]
Through M-KESHO, over 4.5 million Equity Bank account holders and over 9.5 million M-PESA customers will now enjoy a linkage between the two services.
Recently, the two firms offered all registered M-PESA customers the ability to withdraw M-PESA from the over 650 Equity Bank ATMs.
The inter-linking of the M-PESA system, Kenya’s first mobile money transfer service with conventional banking infrastructure like Equity Bank’s presents a ground-breaking innovation that is a fitting platform for the development of new services in line with the two organization’s vision of deepening financial inclusion.
Financial access is a key component of the economic pillar in Kenya’s Vision 2030. Safe and secure savings, access to credit and affordable insurance are financial services needed by all including the low-income households who lack access to these services. The bottom of the pyramid, the majority of who are still unbanked seek for opportunities to access affordable financial services. This partnership helps expand access to financial services. Dr James Mwangi also serves as the Chair of Kenya’s Vision 2030 Delivery Board.
About Equity Bank
www.equitybank.co.ke
Equity Bank is the leading Microfinance Bank in Africa, listed at the Nairobi and Uganda Stock
Exchanges. It is the largest bank in the region in terms of customer base with over 4.5 million bank accounts that is 54% of all bank accounts in Kenya and has presence in Uganda & Southern Sudan.
The vision of Equity Bank Ltd is to champion the social economic prosperity of the people of Africa while its purpose is to transform the lives and livelihoods of our people socially and economically by availing them modern, inclusive financial services that maximize their opportunities The Bank has evolved with growth and strength of capability to become an inclusive bank for all because of its low cost business model.
The Bank runs on a Global Robust State of the Art Information Technology Computer System supported by Infosys, HP, Oracle and Microsoft. The multi-currency, multi-company, multi- country system has a capacity of 35 million accounts and a processing speed of 300,000 transactions per minute. This system is integrated with WAY 4, an online Card Management System that has multi-institution and multicurrency transaction processing capability and has the ability to handle over 60 million cards with speed performance of 180,000 transactions per minute. The Robust System is backed by a comprehensive Business Continuity and Disaster Recovery System.
About M-PESA
www.safaricom.co.ke
Launched in partnership with Vodafone in March 2007, Safaricom’s global acclaimed award-winning MPESA is the first commercial mobile money transfer system in Kenya. Designed to answer to the needs of the unbanked and people outside the formal financial system, this trailblazing innovation has had phenomenal success, to global acclaim. According to March 2010 figures, M-PESA serves a growing clientele of about 9.5 million subscribers through an agency network estimated at over 17,000 units. It has handled over Sh405 billion in person-to-person transfers since launch.
A poll of 1,000 likely 2010 general election voters was conducted on March 4-8, 2010 by the bipartisan polling team of The Mellman Group and Ayres, McHenry & Associates. The poll has a margin of error of ± 3%. Here are some key results.
THE FINANCIAL CRISIS AFFECTED AN EXCEPTIONAL NUMBER OF AMERICANS
46% have either lost their job, or had a family member or close friend lose a job due to the financial crisis; 53% have lost some, most or all of their savings.
FINANCIAL REFORM IS A HIGH NATIONAL PRIORITY
74% of voters believe that the chances are 50-50 or better that the U.S. will experience another financial crisis in the next three years.
Most Americans believe that reforming the financial sector is a top priority for the nation, even in the face of other pressing issues such as health care, education and immigration reform, and the war in Afghanistan.
59% of voters felt Congress and the administration should support financial reform now, over other priorities.
INACTION WILL HURT INCUMBENTS
50% of voters say they would view their member of Congress more favorably if reform is enacted this year, while only 18% would view them less favorably.
ALL KEY ELEMENTS OF REFORM MATTER
Each of these major elements of reform was supported by over 80% of voters: An early warning system to address signs of trouble in the system; Ending “Too Big to Fail” and bailouts; Increasing market transparency to protect investors and families; Giving consumers better information about business practices.
AFTER HEARING THE ARGUMENTS FOR AND AGAINST THE PROPOSED REFORMS, VOTER SUPPORT FOR LEGISLATION INCREASED
At the start of the survey, 29% opposed reform, and 40% supported it.
After details were explained and arguments for and against reform described, opposition stayed at 29% but support rose to over 60%.
Click on the link below to read the poll findings.
The Senate isn’t quite finished regulating the credit card industry.
Senators have surprised the industry with unexpected, tough amendments
that would limit interchange fees and allow caps on interest rates.
The amendments that pass will be included in the financial reform bill being
debated in Congress. Both would be significant blows to the bottom line
of credit card issuers.
On Monday, Senator Sheldon Whitehouse (D-R.I.) introduced an
amendment that would require credit cards to follow the laws of the state
where a customer resides rather than the laws of the state where the credit
card company builds its headquarters. Many issuers have their headquarters
in South Dakota or Delaware that have fewer consumer protections and
laws that enable issuers to charge higher interest rates.
Banks warn that of the difficulty of complying and the “avalanche of
lawsuits” that will arise with differing state laws. It could also mean that
less credit would be available for banks and small businesses.
Guest article submitted by Bill Hardekopf, CEO of LowCards.com, his contacts can be found at the end of this piece.
Last week, the Senate passed an amendment sponsored by Senator
Dick Durbin (D-Ill.) that could reduce interchange fees that credit card
processors charge to merchants and allow stores to give customers
discounts for paying with cash, check or debit cards.
The Durbin amendment is good news for retailers, but bad news for issuers,
processors such as Visa and MasterCard, and some cardholders.
“The CARD Act reminded us that regulations have consequences. When the
government adds new rules and regulations that cost banks money, banks find
ways to charge the consumer more in other areas to make up the lost
revenue,” says Bill Hardekopf, CEO of LowCards.com and author of The Credit
Card Guidebook. “Banks warned that the CARD Act would bring higher rates and
fees. And they did. Issuers weren’t bluffing then and they aren’t bluffing
now. If this passes, consumers may not be happy with what the regulations
mean for them.”
The interchange fee is a stealth fee that receives little attention from the
average consumer, but it provides important revenue to credit card issuers.
Each time a consumer uses a credit card to make a purchase, the bank and
card processor charge a fee that is approximately 2% of the purchase price.
If a consumer makes a $100 purchase with a credit card, the retailer gets
approximately $98. The remaining $2 is the interchange fee and is divided
three ways: about $1.75 goes to the card issuing bank, $0.18 goes to the
Visa or MasterCard association, and the remaining $0.07 goes to the
retailer’s merchant account provider.
In 2008, banks collected an estimated $50 billion in interchange fees. The
interchange fees provided vital revenue for issuers during a time of high
defaults and losses.
According to The Nilson Report, consumers made 36 billion debit and
prepaid card transactions and 20 billion credit card transactions in 2009.
Last year, the interchange fees averaged 2.23% for American Express, 2.06%
for Visa and MasterCard and 1.88% for Discover.
Retailers have lobbied Congress against the interchange fee for years,
complaining that the fee is too high.
Provisions of the Durbin Amendment The amendment will allow stores to give customers discounts for
paying with cash, check or debit cards. The seller can also decline credit
cards for small dollar purchases (interchange fees exceed profits on some
sales).
The amendment will direct the Federal Reserve to issue rules to ensure
that debit interchange fees are “reasonable and proportional” to processing
costs. It does not give the Fed the power to set interchange fees.
“Keep in mind that ‘reasonable and proportional’ is open-ended. It does not
put a cap on the fee,” says Hardekopf.
Cost of Reform for Cardholders Banks say they charge the interchange fee to cover operating costs to
process credit card transactions, to maintain the processing network, and to
protect against fraud. They warn that if the interchange fees are cut, they
will have to find other ways to recoup these costs. This could force them to
once again squeeze credit and raise the cost of credit cards at a time when
economists and retailers are hoping for looser credit to boost the economic
recovery.
Interchange fees are used to underwrite “free” credit card loans and
credit card rewards. If the funding dries up, so could the benefits for many
cardholders.
“The interchange fee has helped subsidize credit cards for people who pay
their balance in full every month. The interchange fee allows issuers to
make money from every cardholder, even for those who pay off their balance
every month and do not pay an annual fee. If issuers can’t make money on
these accounts, they are likely to add fees to make these accounts
profitable or close the accounts. Issuers aren’t charities that give away
free loans, cash and airline tickets” says Hardekopf. “Consumers that have a
rewards card with no annual fee or debit cards with rewards may be the first
to see the changes.”
Retailers will save money, but will they pass these savings onto consumers?
“It would be surprising if retailers significantly cut prices because of
this. Many retailers and merchants are also struggling and need every dime
they can get.
If consumers currently don’t know they are paying this fee,
there will probably not be a large outcry if the price doesn’t change,”
says Hardekopf. “Consumers may find the biggest savings with
merchants that give discounts for alternative payments.”
Effect on Smaller Banks and Credit Unions The amendment’s debit fee requirement exempts banks and credit unions with
assets under $10 billion (99% of banks and credit unions), allowing them to
collect the higher fee. However, these cards will cost more for merchants
to accept. While merchants have to accept all cards in the Visa and
MasterCard network, they can set a higher minimum payment for a community
bank-issued card, encouraging consumers to use another card or form of
payment. This could hurt the smaller banks and credit unions because the
interchange fees are an important source of revenue for their own credit
cards, which typically charge lower rates and fees than the big banks.
Results of Similar Legislation In 2003, Australia’s central bank required that the interchange fee be cut
in half, to less than 1 cent. According to the New York Times, banks and
credit card companies claim the lower fees have cost them about $1 billion
Australian dollars annually, or $919 million, and there have been several
changes in Australia’s credit card industry. Banks have reduced credit card
reward programs. Banks now require customers to pay their credit card bill
faster. Annual fees have increased for reward programs.
The Senate could vote on the Financial Reform Bill on Wednesday. If
it passes, leaders of the Senate and the House (which has passed its own
bill in December 2009 that does not include these amendments) will meet the
following week to negotiate differences between the two bills. The Senate
and House would each vote one more time on this compromise bill before
President Obama signs it.
LowCards.com (http://www.lowcards.com) simplifies the confusion of
shopping for credit cards. It is a free, independent website that helps
consumers easily compare credit cards in a variety of categories such as
lowest rates, rewards, rebates, balance transfers and lowest introductory
rates. It also gives an unbiased ranking and review for each card.
The LowCards.com Complete Credit Card Index (http://www.lowcards.com/CreditCardIndex.aspx) is the most objective and comprehensive resource on the Internet which allows consumers to compare rates for all 1060 credit cards offered in this country. Created by Hampton & Associates, the company has been analyzing the credit card industry and supplying objective websites on various consumer expenses for ten years.
For more information, contact Bill Hardekopf at 1-800-388-1910 or billh@LowCards.com
Norges Bank Investment Management, the arm of the Norwegian central bank which manages the assets of the NOK2.7trn (€347bn) Norwegian Government Pension Fund Global, has enhanced its website to allow users to search its equity and fixed income holdings and voting records.
As well as offering continuous updates on the fund’s market value, NBIM says there’s also a new search device enabling users to find information on the fund’s holdings and voting records “by region, country and company”. The fund owns around 1% of the world’s listed companies.
The development enables readers to see the giant fund’s equity holdings in, say, China.
A quick glance through the data reveals that the fund has 941 investments in the country, worth around NOK23.9bn (€3bn). An analysis throws up some interesting snippets, such as the fact that it has 55 investments in the Cayman Islands worth some NOK4.5bn (€556m).
SAM is inviting the world’s 2,500 largest companies to take part in this year’s SAM Corporate Sustainability Assessment.
Based on SAM’s annual sustainability analysis, the best companies in each sector are selected for inclusion in the Dow Jones Sustainability Indexes (DJSI).
The DJSI are the most highly recognized and long-standing global sustainability indexes.
The investment volume of DJSI-based portfolios now exceeds $8 billion.
It’s happened again. Bank of America, by some measures the largest bank in the United States, has erroneously foreclosed on a house and then sold it right out from under the owners, who were up to date on their payments and the victims of another mistake.
FierceFinancehas noted a spate of such incidents around the country. The latest incident occurred in the metropolitan Atlanta area. Homeowner Rani Achaibar told a local FOX affiliate that she was shocked when a man showed up at her house claiming he had just purchased it.
Unbeknownst to the Achaibars, their $500,000 home had been auctioned off at the county courthouse.
Bank of America at least conceded that the Achaibars were up to date on their payments and that a mistake had been made.
This is something that easily generates bad press locally. The home office perhaps ought to get involved, as it really undercuts the image of Bank of America as a competent institution.
Kleiner Perkins Caufield & Byers, one of the iPhone’s biggest and earliest supporters, is doubling the size of its iFund to $200 million. The specialized venture capital fund, which was founded two years ago with the launch of the original iPhone, will now make investments in start-ups based on Apple’s family of products including the iPhone, iPod Touch and the iPad.
Kleiner’s John Doerr believes the launch of the iPad on Saturday marks the start of a new revolution in PCs: it sheds the tired user interface and replaces it with touch, and retires the click with a “swoosh,” he said. “It’s direct and natural. Instead of holding a mouse you are going to be holding magic.”
The fund had to be extended to make any further investments. In just two years, it had become fully committed with investments across 14 companies. In addition, Kleiner said iFund companies had been supported by a $330 million more from other investors.
So far, iFund-backed companies have already starting building more than 20 applications for the iPad with 11 expected to be available on April 3 when the device is available. Seven of them are games from ngmoco. Kleiner’s investment areas of interest on the iPad are broad and include entertainment, communication, social networking, commerce, health care, and education.
The Thrust Fund takes the maxim ‘invest in people’ literally: in an effort to generate growth capital for their social enterprises, three people are selling equity in their own future earnings.
A truism among venture capitalists is that not only do they invest in promising business concepts; they also “invest in people.”
Seeking to make that premise literally true, three social entrepreneurs recently united to form Thrust Fund, an online marketplace for personal investments. In an effort to generate growth capital for their social enterprises, the trio is using the site to offer up equity in their life’s earnings in exchange for an unrestricted upfront cash investment.
Valuing themselves at USD 10M, Saul Garlick, founder of ThinkImpact, and Jon Gosier, founder of AppAfrica are each offering 3 percent of their future earnings in exchange for a USD 300,000 investment, while Kjerstin Erickson, founder of FORGE, is offering a 6 percent stake in her future earnings in exchange for USD 600,000. Investing in the individuals rather than in the organizations they founded, “Thrust Funders” do not acquire a portion of the entrepreneur’s venture; neither do they have any official say in how the investee uses the money.
Is Elevation Partners “the worst run institutional fund of any size in the United States?” That was the assertion of a Wall Street 24/7 post earlier this week, and a bunch of readers emailed Dan Primack of PEHUB for his reaction.
So he decided to take a dive into the media/tech-focused firm’s portfolio, from a financial perspective. What he found was hardly cause for celebration, particularly for a shop whose high-profile partners include Bono, Roger McNamee and Fred Anderson. At the same time, however, calling Elevation “the worst” is to give hyperbole a bad name.
