You may be thinking about moving or you may have already decided that Australia is the place for me. You will be joining many others that have gone down under to enjoy the sun and enjoy life outdoors.

It can be a minefield trying to organise and understand what you need to move and what options are best for you.

This will give you an easy-to-understand guide on some of the most popular visas available to you and how to start the process.

Skilled Independent Visa

The most popular and straightforward visa to apply for is the skilled visa. This is for individuals who are moving and have skills and experience in one or more of the occupations on the skilled occupation list.

With this visa, you can:

• Live, work and study anywhere in Australia
• Enrol in Australia’s public health care scheme
• Sponsor your relative
• After a certain time, you could be eligible for Citizenship

The visa costs AUD4,640.00 for the main applicant. For any family members you wish to add to the application, there will be an added cost.

Before you apply; You must complete the Eligibility assessment and score 65 points or more. You must submit your expression of interest (EOI) through Skillselect telling the Australian Government that you are interested in applying for a visa, You should provide proof of health and have any necessary health checks before applying to have a better chance of being accepted.

You will then be invited to apply for the visa formally, you can do this by logging into your Skillselect account. You will need to apply within 60 days of receiving your invitation so you should have all your documents ready before being sent the invitation so you are prepared. The application will tell you what documents you need and you must attach them all at the time of applying, not after you submit.

You need, an ID, Character documents, your results from the eligibility assessment, and proof that you are proficient in the English Language.

If your application was successful they will tell you:

• your visa grant number
• the date your visa starts
• your visa conditions, if applicable

Skilled Nominated Visa

The visa costs AUD4,640.00 for the main applicant

You can be nominated when you submit your EOI and a state or territory government agency decides to nominate you to be able to apply for the visa.

You can contact these agencies by state directly to inform them you are interested in a visa and have completed the EOI.

The state and territory agencies include:

• Australia Capital Territory
• New South Wales
• Northern Territory
• Queensland
• South Australia
• Tasmania
• Victoria
• Western Australia

To be nominated for this visa you must:

• Be 45 or under when you are invited to apply
• Have a suitable skills assessment from the last 3 years
• Have obtained 65 or more points from the Skills assessment and the EOI
• Have skills or an occupation on the skilled occupation list.
• Meet the health requirements and take part in a health check
• Have competent English
• Meet the character requirements which include a clean criminal record and immigration record, E.G. not had a visa cancelled in the past or have been deported in the past.

With this Visa, you can live and work permanently in Australia and sign up for the public health care scheme. You will be able to sponsor relatives to join you in Australia. You will be able to travel to and from Australia freely for 5 years, after this has expired you will have to apply for a Resident Return (RRV) visa (subclass 155 or 157).

Employer Nomination Scheme visa

The visa costs AUD4,640.00 for the main applicant.

If you are moving to Australia for a job then your employer can nominate you for a visa. You must be already working or will be working for the employer on arrival to Australia.

You must:

• Have the necessary skills for the job.
• Be nominated by an Australian employer.
• Meet the health and character requirements.

With this visa, you can:

• Live and work in Australia for 5 years
• Travel to and from Australia for 5 years
• You may be able to apply for permanent residence after 3 years from the time your Employer Nominated visa began.

With this visa there are three routes you can take, the employer-sponsored stream which allows employers to fill the shortages in their industries. The labour agreement stream is only for employers who are part of this agreement. Finally, the subsequent entrant is for family members who are joining the main applicant on an employer-nominated visa.

These are the three most common visa’s for people moving to Australia

All of these transactions, however, come with a price. The credit card institution tacks on an interchange charge that the merchant or supplier must pay whenever customers swipe a credit or debit card, whether physically or digitally, on the internet. These small costs, often known as swipe fees, may add to huge budget busters for many large and small enterprises. 

Interchange fees cover the expenses of accepting, processing, and approving card transactions. Many factors might impact the fee amount, making it difficult to estimate the precise amount of the costs.

We've put together this quick guide to explain interchange costs, the variables that influence them, and where you can search up interchange fees per card network.

What are interchange fees?

When a customer or a business purchases products or services from a merchant or supplier using a credit/debit card, the credit card company charges the merchant selling the commodity or service an interchange fee (or rate). Credit card costs are higher than debit card fees, yet they only account for a small portion of the purchase price.

Financial services businesses adopt these swipe fees to earn revenue and as a "buffer" or hedge on accepting the short-term credit risk when a client borrows money from the financial institution to buy anything. Other costs, such as credit fraud and chargebacks, are also covered by the fees.

How are interchange fees calculated?

Interchange fees are calculated using various criteria, but financial institutions base them on financial risk statistics and the expenses of processing and moving money, among other things. These fees are determined by credit card networks such as Visa, MasterCard, American Express, and Discover once or twice a year.

Recently, Visa and MasterCard announced interchange fee figures. If you check Visa or MasterCard’s interchange fees, you'll see that the final (single) interchange price you pay is made up of many interchange fees. 

Every consumer transaction you process through your website incurs a cost from credit card networks like Visa and MasterCard, payment gateways and processors, card-issuing banks, and your company bank account. It's a percentage charge depending on the overall transaction amount, and it's typically included on your payment processor's invoice as a single, combined number. It becomes difficult for merchants to pay these fees since the sum they must pay usually varies depending on certain transaction circumstances. The following are the many factors that will influence the charge amount:

Card type

Interchange fees vary depending on the kind of card and the financial institution issuing it. Debit cards offer cheaper fees than credit cards due to a lesser chance of fraud. Interchange costs on rewards cards might be greater than on regular cards.

Card network

Interchange costs vary depending on the type of company and its size, such as grocery stores vs. boutique gift shops. Interchange fee charges are also affected by the size of the firm. Large corporations, for example, may be able to negotiate cheaper interchange fees with financial institutions than small enterprises.

Transaction type

How the transaction was completed is another factor that influences interchange costs. Was it purchased through a cash register, mail order, or online? 

Card-present vs. card-not-present - Card-present (CP) transactions have a reduced risk of fraud than card-not-present (CNP) transactions, resulting in lower interchange rates (i.e., online or digital payments).

Domestic vs. cross-border payments - It's a domestic transaction if the cardholder's bank is located in the same nation as your company. And it's typically less expensive than cross-border transactions if the card-issuing bank and your company are not located in the same country.

What are the average interchange fees companies charge?

Interchange costs in Europe are typically roughly 0.3 - 0.4% of the overall transaction value. It is 2% in the United States. Card schemes determine interchange fees, which you cannot bargain with. Card networks also regularly adjust the rate rates; for example, MasterCard and Visa announce new rates every April and October. Today, the best approach to determine actual costs is to visit the card scheme's website.

Difference between interchange++(plus-plus) and blended prices

Interchange++ (Interchange Plus Plus) and blended pricing are the most common pricing structures for card transactions. The main distinction between the two is transparency.

Interchange ++(plusplus)

You may thoroughly analyse the three-card payment processing costs you learned about before using Interchange++. The interchange charge, the card scheme fee, and the acquirer markup fee are all fees you must pay. You're only charged the actual interchange price, which can be cheaper than if it were set because interchange fees vary based on various circumstances.

Blended pricing

Using a blended pricing model, you'll be charged the average processing cost plus a set markup fee. The markup charged for each transaction is the same in this situation, and you can't see how expenses are distributed. It's simpler to comprehend, but it's not transparent. There's no way to tell if decreased exchange rates save you money.

Wrapping up

Interchange fees have become a significant financial factor for many businesses, whether small businesses or giant corporations, with many screaming foul. You might be concerned that interchange fees would eat into your revenues, but the advantages of accepting additional online payment methods outweigh the expenses of interchange fees. In short, you could attempt things like pushing people to use specific card types or shopping in person. Still, these minor tweaks will gradually detract from the customer experience and turn off potential and current customers. 

You'd be better off looking for alternative methods to save costs in your company. Allowing clients to pay with credit or debit cards is critical for increasing customer happiness, conversions, and brand loyalty, regardless of the size of your business or the items you offer.

The deal means UK Amazon customers can continue to use their Visa credit cards.

Back in November, Amazon announced it would stop accepting payments via Visa credit cards because of Visa’s increased fees due to Brexit. At the time, Visa said it was “very disappointed” with Amazon’s decision. 

Amazon has since been pressuring Visa to lower its fees in a series of moves that motioned retailers’ increasing frustration over the costs associated with major card networks. 

Speaking to CNBC via an email on Thursday, a spokesperson for Amazon said, “We’ve recently reached a global agreement with Visa that allows all customers to continue using their Visa credit cards in our stores. Amazon remains committed to offering customers a payment experience that is convenient and offers choice.”

The e-commerce giant is also set to abandon a 0.5% surcharge on Visa credit card transactions in Australia and Singapore, which it introduced last year.

The dispute is about the fees charged by Visa, which have recently increased due to Brexit. Interchange fees sit at the centre of this issue. This is a small fee levied by card networks such as Visa on every transaction made using its cards, taken to cover the cost of processing the payment. 

Under 2015 EU regulation, interchange fees were capped in the bloc of 0.2% for debit card transactions and 0.3% for credit cards. At the time of introduction, the EU said that the regulation would save consumers approximately $6 billion in hidden fees. However, post-Brexit, operators in the UK are no longer bound by these rules. 

According to the Financial Times, Visa planned to up its cross border interchange fees from 0.3% to 1.5% this year. Such fees, to be paid either by Amazon directly or by sellers on its platform, would erode profit margins and lead to more costly products if passed on. 

A spokesperson for Amazon said, "The cost of accepting card payments continues to be an obstacle for businesses striving to provide the best prices for customers. These costs should be going down over time with technological advancements, but instead, they continue to stay high or even rise.

"As a result of Visa's continued high cost of payments, we regret that Amazon.co.uk will no longer accept UK-issued Visa credit cards as of 19 January, 2022."

The online retailer also advised its customers to update their default payment.

There are several downsides to this arrangement for businesses. Firstly, this will increase their recruitment costs as visas are not cheap; secondly, obtaining work visas can also be time-consuming and delay the hiring of talent. The reality is that the business immigration system needs an overhaul. Business immigration is a benefit to the UK and should not be confused with social immigration which is entirely different. Our immigration should not be governed by policies issued by the current government but, rather, based on the needs of businesses.

To ensure the UK remains one of the leaders in technology and development, we need to encourage the best global talent to come to the UK with a cutting-edge approach to gain talent and investors. In order to do that we have to have an adaptable immigration system that welcomes talent, decent businesses and the workforce we need.

It’s also imperative, in my opinion, that we let students come to the UK to study and work after they have completed their degrees. We have just allowed this again but only for 12 months! Not long enough in my view but it is a start…

A note on social vs business immigration

I have practised business immigration for over 20 years. Social immigration is an entirely different kettle of fish and colours the debate, making it impossible to set sensible goalposts for businesses. Many say most are opposed to immigration and yet most of us are a product of some form of migration. In reality, most are opposed to social migration rather than business immigration.

In all of my 20 years practising business immigration, all of the employees I have helped bring in have paid fees and taxes and the majority have left the UK after their assignment, few (if any) have taken jobs from local people. Some have remained, fallen in love with a person or the country and contributed greatly to the economy. Sadly, having practised criminal defence work for almost a decade before this I think it is still cheaper to obtain a UK passport or false papers on the black market than it is to go through legitimate channels.

Addressing business immigration needs

We are moving in the right direction but we need to take immigration policy out of the politicians' hands and place it in the hands of businesses. Businesses need to be trusted that they will hire those they need. Most businesses want to avoid sponsoring individuals for visas unless there is no other option.

But the job has to be a certain pay grade and a certain level. Industries like hospitality are unable to sponsor the individuals they need as the skills they need are considered too low. A lot of that workforce left in the pandemic and are now stuck, unable to return to the UK. That is why our restaurants and bars are short-staffed.

So business is suffering. And the war for talent, and wages, is fierce.

Businesses must do as follows:

1. Ensure all your existing staff have a right to work by conducting appropriate right to work checks. Taking a staff member's word for it is not sufficient. You must have seen their original paperwork and keep a copy of it or use the Home office to verify their status. Failing to do this can result in a £20,000 fine per illegal found. Getting out of these fines is incredibly difficult and frankly only feasible if you have been given fraudulent paperwork.
2. If you are a professional business needing talent then you need to apply for a sponsor licence ASAP. Or if you previously relied on European workers to staff your business equally you need to apply for a sponsor licence ASAP. This enables you to then potentially sponsor those from Europe and anywhere in the world who wish to work in the UK. Provided the job is at a suitable level. Beware the processing times are increasing as more and more businesses apply for a sponsor licence.
3. Budget for increasing recruitment costs, work visas are not cheap and you will need to pay for them.
4. Allow time to obtain work visas. Sadly our system is overwhelmed and this is likely to only get worse as the scale of the problem reveals itself.
5. Certain sectors that have heretofore relied on lower skill levels need to campaign and raise awareness and push for change, ideally with backing from UK society at large, to help to enable them to hire and recruit the talent they need wherever it may be.

The most important thing is to keep being vocal about the ways the new immigration system is failing businesses. We need to campaign for the best, open-minded, straightforward business immigration system in the world. Let us lead the charge and suck up all the talent we can to ensure the UK remains Great Britain!

On Thursday, Visa agreed to acquire Tink in a deal that aims to boost digital ambitions by the financial services giant. Back in January, Visa had attempted to buy Plaid. However, the takeover was abandoned after the US Department of Justice blocked the sale on antitrust grounds. Plaid, recently valued at $13.4 billion, has since gone it alone as an independent company.

Both Plaid and Tink are open banking platforms, a concept which invites lenders to consensually provide third-party firms with access to consumer baking data. Tink was founded back in 2012, with the goal of changing the banking industry for the better. Its technology allows banks and fintech firms access to the banking data needed to create new financial products. The Swedish-based company was recently valued at €680 million, as open banking thrives in the UK and EU thanks to new regulations.

Here Andy Barratt, UK managing director at international cybersecurity specialist Coalfire, explores how the financial services sector can turn the tide on costly, high-profile cyber missteps.

It’s fair to say that the financial services sector has struggled to secure positive consumer sentiment for itself recently – particularly in relation to cybersecurity. At the end of October, the government’s Treasury Select Committee (TSC) went so far as to say that the number of IT failures at banks and other financial services firms has reached a level it deems “unacceptable”.

The criticism, which highlighted poor IT performance within financial firms and a lack of decisive action from their regulators, comes in the wake of a string of high-profile and costly cyber glitches in recent years. Most notable among those is TSB’s unsuccessful attempt to migrate its systems over to new parent company Banco Sabadell.

Customer details were left easily accessible and vulnerable to fraud attacks, as well as resulting in thousands being unable to access their accounts. But TSB are not the only culprits: Barclays, RBS and VISA are among a raft of other major financial service providers to have suffered serious technical glitches in the past few years.

Why then, with so much at stake, are financial firms lagging behind when it comes to their cyber strategy?

Complex legacy tech infrastructure

The first aspect that makes large firms so susceptible to attacks is that their IT systems are often complex and, significantly, outdated. Hackers can easily find weak spots in the system or, as in TSB’s case, vital information can slip through the cracks.

The first aspect that makes large firms so susceptible to attacks is that their IT systems are often complex and, significantly, outdated. Hackers can easily find weak spots in the system or, as in TSB’s case, vital information can slip through the cracks.

Our inaugural Penetration Risk Report, which took place around the time of TSB’s issues, found that the largest firms are less likely to be prepared to face up to cybercrime than their mid-sized equivalents – despite greater budgets and resources – due to their cumbersome and slow-moving infrastructure.

More recently, we’ve seen those larger businesses close the gap, mostly through the support of in-built cloud security services, but the risks still remain for many. In the financial services sector specifically, this year’s study indicated that the level of external threat has actually increased.

The rush to implement services under a new ‘Digital’ initiative sometimes comes at the cost of addressing the underlying legacy issues too. Whilst the big banks rush to keep up with the online-only challenger banks they re-allocate budget for the new apps and forget the underlying infrastructure they depend on.

‘Yes’ culture

One of the key risks boosting that threat is a habit within large corporate cultures for IT teams or risk managers consistently ‘downgrading’ risks due to lack of understanding or complacency when reporting to those further up the pecking order. This is dangerous and can lead senior figures to the conclusion that everything is ‘ok’ within their organisation when, in reality, an IT crisis is just around the corner. This is particularly true when organised crime groups are targeting financial services with highly sophisticated attacks that are often discounted by management with a throw away ‘nobody would do that’ comment.

Companies should attempt to foster a ‘safe’ environment where staff feel comfortable raising problems they encounter so that solutions can be found before disaster strikes. They should also to remain current with intelligence from their incident response and forensic partners who will see the sophisticated threats when they do cause a breach.

An enhanced understanding of the issues facing the business is less likely to leave senior spokespeople up a creek without a paddle when facing the media. No one would expect a CEO to know all the ins-and-outs of their IT infrastructure, but basic comprehension can go a long way. Knowledge is power.

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Weak links in the chain

Due to the nature of the industry and the services they provide, banks and large financial firms are required to interact with third parties on a massive scale. Unfortunately, this isn’t without its drawbacks.

Many third parties – and, by extension, their own supply chain – lack the sophistication and / or the wherewithal to deal with cyberattacks. As such, they are often the first port-of-call for a hacker looking to worm their way into a major system.

An example includes the British Airways data breach in the summer of 2018, when hackers were able to take information directly from the airline’s website thanks to access from a third party.

Often, being subject to this form of intrusion is pure bad luck rather than bad planning. However, large firms must ensure that they’re sufficiently protected and that access for third parties is limited. It’s a simple case of making sure that your back’s covered wherever possible.

Human error

Perhaps the most common error (and the most tangibly addressable) is the human risk inherent within any business. Naturally, the larger your workforce, the greater the risk you face, which is a major issue within the financial services sector.

Phishing, a scam that prompts staff to provide their username and password, is still one of the simplest but most successful ways potential attackers get their foot in the door.

The key to combatting the danger is providing constant training to employees so that they’re fully aware of the threat and the responsibility that they have towards protecting the business.

What’s more, the high-profile cases mentioned above are dangers in themselves: when the glitch or failure makes the news, a sign post is placed for hackers looking to break in. Each headline is an ‘x-marks-the-spot’ for a company’s weak spot, as well as their competitors’.

It’s a brutal world that financial services businesses face as technology advances but, with such large amounts of money at stake, they must be up to the challenge.

For $5.3 billion, Visa has agreed to acquire the Silicon Valley start-up Plaid, a firm that is already backed by huge tech investors such as Mary Meeker and Andreessen Horowitz as well as Goldman Sachs. It was valued in 2018 at $2.65bn and is now already worth twice as much.

For visa, this transactions means a deeper push into the ever-growing fintech sector, particularly after is bought a minority stake in Klarna in 2017.

Plaid is a software provider that enables other fintechs and payments services to access customer bank accounts and details, enabling smoother handling of information for financial planning apps, money transfer apps and so forth.

Al Kelly, chief executive and chairman of Visa, said: “This acquisition is the natural evolution of Visa's 60-year journey from safely and securely connecting buyers and sellers to connecting consumers with digital financial services.”

“The combination of Visa and Plaid will put us at the epicentre of the fintech world, expanding our total addressable market and accelerating our long-term revenue growth trajectory,” he continued, according to the FT.

Reporting on the agreed acquisition, Forbes fintech expert Jeff Kauflin believes Visa is strategically acquiring plaid for the sake of its relationships and partners: “Plaid’s 2019 revenue was between $100 and $200 million… Visa would be paying a sky-high price of 35 times sales, one of the highest price-sales multiples in recent history for a private company.

“Visa’s primary reasons for buying Plaid are twofold. First, Plaid works with the vast majority of the largest fintech apps in the US, including Venmo, Square Cash, Chime, Acorns, Robinhood, and Coinbase. With the acquisition, Visa gets access to an important, ballooning base of customers that it can sell additional payment services to. Second, Visa has a global network that’s unparalleled in financial technology, with millions of customers across 200 countries. That will make it much easier for Visa to take Plaid global.”

On the other hand, Stefano Vaccino, founder and CEO of Yapily, believes that this is just the first of many moves by card operators, in anticipation of the changes to the way we pay, powered by Open Banking: "It’s great to see big players positioning themselves in the world of open banking and open finance, this will help to accelerate the sector’s growth even further. 

“Card payments are expensive for merchants to process, and with two-factor authentication on its way in the second part of this year, there will be an increased layer of friction. Payments through Open Banking will offer a smoother and more secure way to pay, and will provide an opportunity for merchants to decrease costs and transfer these benefits to consumers.

“This space will be disrupted hugely as the possibilities of open finance are realised, and incumbents must innovate to remain relevant.”

On the back of last week’s news that PayPal decidedly pulled out of the alliance backing Libra, Facebook’s new cryptocurrency project, Mastercard, Visa, eBay, Stripe and Mercado Pago have also announced their withdrawal from Libra.

Finance Monthly has heard from Martha Bennett, VP & Principal Analyst at Forrester, who had this says this was to be expected.

This wasn’t a surprise, and not just because PayPal announced a few days earlier that it wasn’t going to sign up to the Libra Association at this time. As I (and others) also pointed out during the summer, none of the 27 Libra members announced in July had actually signed any binding contracts – it was letters of intent; in other words, companies were keeping their options open. With the first session of Libra’s governing council looming (today), it was make-or-break time in terms of making an actual commitment.

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As the regulatory and government backlash in the US and around the world proved, the Libra proposal not only proved controversial, but there was also far too little detail available to come up with meaningful judgements. Despite protestations to the contrary (i.e. Facebook only being one of many organisations within Libra, represented by its subsidiary Calibra), Facebook has been the driving force behind Libra, and with David Marcus, very much remains a public face of Libra. This in turn heightened the scrutiny of Libra, with concerns not only raised by FS regulators but also privacy and competition authorities. There was always potential reputational risk associated with participation in Libra; the degree of the backlash, combined with Libra’s/Facebook’s somewhat unconvincing efforts at entering into the dialog with regulators and the continued absence of details around key aspects of Libra’s functioning and governance (including how regulatory compliance was going to be achieved), clearly proved too much.

I wouldn’t write off the initiative yet, but the Libra Association’s work has become much, much harder.

Will Libra survive? I wouldn’t write off the initiative yet, but the Libra Association’s work has become much, much harder. Given that the key concerns from PayPal and the other payments firms were around the lack of meaningful detail around regulatory compliance, a real step change is needed here. The recent statements from David Marcus and spokespeople from the Libra Association have continued to be thin on detail. There’s also the matter of tone; for example, there’s not much point in reiterating that Libra won’t pose systemic risk – if regulators and governments have concluded that it does, a more comprehensive and in-depth response is called for.

There’s been a lot of talk around the intervention on the part of the two US Senators writing to payment networks, and what impact that had. Whether or not those letters were appropriate is a separate discussion. In my view, the companies in question would have pulled out anyway, for the same reason PayPal did: insufficient visibility on how Libra was really going to come to grips with compliance, and the associated risk of reputational damage (as highlighted before), and potentially worse (e.g. impact on those organisations’ relationships with regulators).

But according to James Butland, VP European Banking at international payments platform Airwallex, this is changing.

Innovative solutions and more customer centric business banking platforms are on the rise, and, as a result, SMEs are moving away from their current banks in their droves. This is highlighted by the UK’s Current Account Switch Service reporting that there were 17,687 business account switches using the service during Q2 of this year, compared to just 8,000 switches during the same period last year.

Clearly, SMEs are hungry for new services that help them to manage their money more effectively, and with Brexit and a fluctuating currency potentially causing issues, it couldn’t come sooner.

World changing SME banking 

The need for services that better meet the demands of businesses has seen payment fintechs such as Accelerate, Square and Monzo partner with the likes of Mastercard, eBay and Visa to provide more up to date technology in the B2B banking world. These innovations are aimed at speeding up payments and helping SMEs to compete in an increasingly globalised and competitive economy.

Innovation within international payments has also seen similar developments. This is largely due to the opaque nature of current FX practices. A new paper from the European Central Bank recently revealed that banks across Europe have overcharged SMEs for foreign exchange services, and have earned hundreds of millions of euros each year, at the expense of their small corporate customers. These SMEs have often been presented with misleading exchange rates and secret charges by banks, while unfairly being offered lower exchange rates compared to larger businesses at the same time.

This is a big issue. Particularly as 232,000 of UK SMEs exported to overseas markets last year, representing 10% of the country's small and medium-sized businesses. It’s why companies such as Airwallex, through our Global Accounts and FX capability, is helping SMEs to break through murky FX practices, and access exchange rates that have been typically only available to large corporates. Customers can be shown correct and clear rates and can act as a local in new markets. These new platforms, services, and in some cases new banking entities, are removing the complexities of exporting overseas and therefore allowing SMEs to focus more on growing their business.

Partnership benefits for SMEs

SMEs desperately need these developments because previous legacy payments and slow banking processes are not only significantly slowing down the speed at which they can operate at but are also ultimately limiting their growth. The transparency available now to help SMEs understand FX rates and expenses alongside more innovation within payments and banking solutions will prove vital for smaller businesses going forward. This will provide them with confidence over their margins and allow them to grow through enabling them to provide far swifter payments, both nationally and internationally.

The card uses a customer’s balance in Bitcoin or any other virtual currency and converts it into pounds or euro when paying in physical stores or online. It is the first crypto-based debit card to link directly with a cryptocurrency exchange in the UK and EU, as previously available crypto cards “required users to pre-load a specified amount of crypto onto their card, adding a point of friction to the process."

Why is the launch of the card important and how will it affect the crypto industry?

Making cryptocurrency usage easier

Along with Coinbase’s Visa card, the crypto exchange is also launching an app which will allow users to choose which cryptocurrency wallets should be connected to their purchases. The app will also allow customers to receive instant receipts, transaction summaries and access to spending categories. The process of converting users’ cryptocurrency into fiat is quite simple – “crypto, equivalent to the amount spent, is liquidated immediately into fiat ensuring the correct value is captured at the time of the transaction. Funds are debited immediately from the customer’s account”, explained Zeeshan Feroz, Coinbase UK CEO.

Rolling out Coinbase’s Visa card means opening up cryptocurrency payments to a large swath of users who are eagerly anticipating mainstream acceptance of cryptocurrency payments for everyday purchases.

The card will be first available in the UK only, with the view to soon be introduced across all European markets in which Coinbase operates. “The UK is a great first market for the Coinbase card with its thriving FinTech ecosystem and consumer willingness to try new ideas. The Coinbase Card will initially be available in the UK with a view to going live, in the coming months”, said Feroz.

 What does it mean for the industry?

Rolling out Coinbase’s Visa card means opening up cryptocurrency payments to a large swath of users who are eagerly anticipating mainstream acceptance of cryptocurrency payments for everyday purchases and it goes without saying that any route that allows users to spend crypto in traditional ways is great for the crypto industry. Niv Abramovich, VP of Product at Coti, believes that utilising the card scheme will increase the popularity of cryptocurrencies. “Making digital currencies more accessible to consumers together with the ability to spend cryptocurrency in the real world could be the next phase to mass adoption and mass market of building digital economies and using digital money”.

“Making digital currencies more accessible to consumers together with the ability to spend cryptocurrency in the real world could be the next phase to mass adoption and mass market of building digital economies and using digital money.”

However, Richard Dennis, Founder and Senior Cryptography Adviser at temtum points out that since a Bitcoin transaction takes at least 10 minutes to enter a block, and 60 minutes to be fully confirmed on the blockchain, the payment processes and exchanges involved are risky. “There is a real possibility that a transaction might fail for a number of reasons, and there is nothing that Coinbase would be able to do about it if it does”, he says. So while the new Coinbase card is a significant step forward to using cryptocurrencies as a medium of exchange for daily purchases, as was the original vision of Bitcoin, Dennis thinks that the current generation of blockchain architecture is not able to completely remove the risk from the payment providers.

Steven Parker, CEO of Crypterium, on the other hand, admits that the card is a good ‘starting point’, however, he argues that the solution is still quite narrow because it will be only available to customers in the UK. “There’s no doubt that crypto debit cards are one of the easiest ways to bridge the gap between the crypto and traditional economies, enabling holders to spend digital assets with the same ease as fiat currencies. Big players like Coinbase play a vital role in spreading the word about this product, but ultimately, companies with more inclusive propositions will conquer the market”, concludes Parker.

Amidst a large swathe of planned job cuts at Lloyds, at the beginning of November the bank announced that there was a silver lining - a £3 billion investment programme that will see the country’s biggest high-street lender radically transform its digital strategy. While 6,000 existing roles are being cut from a broad range of areas, 8,000 are being created to focus on areas of digital expansion, including in the group transformation unit. And, the CEO of Tectrade Alex Fagioli points out, it’s about time for Lloyds, as it begins to play catch up with an industry that has quietly been revolutionised by high-street banks and start-ups that have gone all-in on digital banking.

Digital banking provides a great deal of benefits to administrators and alike. Customers are given a more flexible way of banking, accessing their accounts and transferring their money without relying on bank hours. Managers have an unprecedented insight into the activity of branches and can offer services to their customers which they had previously been incapable of. However, the challenges and risks that come with digital transformation have led traditionally large financial institutions like Lloyds to poorly implementing such practices to the detriment of all involved.

In April, a routine systems upgrade at TSB went awry and left 1.9 million customers locked out of their accounts for up to a month. Similarly on Friday 1 June, 5.2 million transactions using Visa failed across Europe as a result of one single faulty switch in one of Visa’s data centres. This isn’t just a continental issue; Atlanta-based Sun Trust – a bank with 1,400 bank branches and 2,160 – experienced a significant outage to its online and mobile banking platforms in September due to a botched upgrade. In all of these cases, the outages weren’t the result of cyberattack or weather-related problems. Instead, these outages came as a result of seemingly insignificant technical factors that had been overlooked – and Lloyds would be wise to heed these cautionary tales.

The challenges and risks that come with digital transformation have led traditionally large financial institutions like Lloyds to poorly implementing such practices to the detriment of all involved.

In the first two instances, cause of the outages are very clear– and they were entirely preventable. TSB rushed into an upgrade by hastily initiating the update across its entire system. For a technical reason that we will likely never know, the update tanked the entire bank and left it at a standstill while it tried to pick up the pieces. Even when it managed to get everything back in place, TSB is now permanently scarred by the event, with its reputation still reeling. The prevention for this would have been a gradual rollout, as opposed to a sweeping installation. If the upgrade was initially piloted with non-essential systems, then the bugs would likely have been spotted early, with little fuss and no media spotlight.

Likewise, the Visa incident came as a result of a single faulty switch and that betrays a lack of understanding of its own systems. It is shocking how few companies have carried out any form of disaster recovery testing on their infrastructure. Administrators are incapable of having a full understanding of the systems they are responsible for without testing them in a controlled and simulated environment. With a controlled disaster test, that faulty switch would have been highlighted and those 5.2 million transactions would have been completed. It’s similar to a car – the reason that MOTs are essential is so that any issues can be highlighted well ahead of them having a serious effect on the vehicle’s performance. Banks must carry out a cyber MOT in order to keep their systems in check and to give IT teams a full working knowledge of any potential issues.

But this is all in the case of preventable issues, and in the modern day accepted wisdom is not if, it’s when outages will happen.

Thus far we’ve only addressed routine operations, but cyberattack is of course an omnipresent threat. Ransomware has spent the past couple of years as the ‘big bad’ in cybercrime, and it is an even bigger threat to the financial sector. Over the past 12 months, the financial services and insurance sector was attacked by ransomware more than any other industry, with the number of cyberattacks against financial services companies in particular, rising by more than 80%.  If a bank were to be hit by a ransomware attack, all online systems for banking and insurance transactions will need to be taken offline, rendering that organisation unable to operate. According to a report from Osterman Research, there is a 50% chance of employees in this industry suffering productivity loss, a 30% chance that the financial and insurance services will shut down temporarily, and a 20% chance of revenue loss and adverse effect on customer perception. In cases of ransomware, data recovery can be very difficult as there is a large amount of customer information stored in a variety of disparate systems. As such, many organisations may feel they have no choice but to pay the fee demanded of them to regain access to the data.

Over the past 12 months, the financial services and insurance sector was attacked by ransomware more than any other industry, with the number of cyberattacks against financial services companies in particular, rising by more than 80%.

Equally as unpreventable are environmental factors. Areas like the Southern States of the USA are frequently dominated by hurricanes and tropical storms which can cause large disruptions to everything from schools to banks. Many of these buildings have to be built with this in mind, and network operations should be created with the same mindset. In the UK, by contrast, we don’t have to deal with such extreme weather conditions, but environmental considerations must be made with the potential for freak accidents. A burst pipe in a shared building or road workers drilling through electrical or network cabling, for example, could see a bank offline for an indeterminate period of time outside of its control. One example of this in action was with National Australia Bank, which suffered a power outage that downed ATMs, Eftpos and online banking across the country for five hours in May.

In all of these situations where outages can occur, banks must make sure they have the capacity to get their systems back online and fast. The best way to do this is by adopting a zero-day approach to architecture. Zero-day architecture won’t prevent an outage, but it will mitigate the effects. It allows organisations to minimise downtime and recover from backups without having to worry about lost data.

A zero-day recovery architecture is a service that enables administrators to quickly bring work code or data into operation in the event of any outages, without having to worry about whether the workload is still compromised. An evolution of the 3-2-1 backup rule (three copies of your data stored on two different media and one backup kept offsite), zero-day recovery enables an IT department to partner with the cyber team and create a set of policies which define the architecture for what they want to do with data backups being stored offsite, normally in the cloud. This policy assigns an appropriate storage cost and therefore recovery time to each workload according to its strategic value to the business. It could, for example, mean that a particular workload needs to be brought back into the system within 20 minutes while another workload can wait a couple of days.

Without learning the lessons of the high-profile outages that have come before it from banks that have undergone their own transformations, Lloyds is doomed to repeat the same mistakes.

As it begins its massive investment in digital transformation, Lloyds could very easily sink its budget into exciting features that promise to improve the lives of customers and employees. However, without learning the lessons of the high-profile outages that have come before it from banks that have undergone their own transformations, Lloyds is doomed to repeat the same mistakes. You can promise all the features in the world, but without a solid foundation the bank will essentially be a house of cards, ready to collapse at the slightest sign of danger. All banks, regardless of size, must prioritise the minimisation of downtime by having common sense policies in patch management, full knowledge of a system gained through disaster testing and a recovery strategy in place that enables it to get back online at speed.

https://www.tectrade.com