In February 2018, the Swiss Financial Market Supervisory Authority (‘FINMA’) published a draft of a partial revision of its Circular 2016/7, ‘Video and online identification.’ The Circular, which entered into force approximately two years ago, sets out the anti-money laundering due diligence requirements that Swiss financial intermediaries must follow when opening new business relationships via video chat or via the internet. The consultation period on this partial revision ran until 28 March 2018. In this article, Grégoire Tribolet and Caroline Clemetson of Schellenberg Wittmer Ltd provide a brief overview of both the current regulatory framework in Switzerland for opening business relationships via digital channels, how financial intermediaries are making use of the potential for technological innovation in the area of client onboarding and finally the key changes proposed by FINMA to its Circular 2016/7. / read more

The Royal Bank of Scotland (‘RBS’) launched on 20 November 2017 an automated online investment service - the NatWest Invest platform - which it claims makes it the first high street bank to offer a robo-advice service in the UK. NatWest Invest will charge £10 plus fees to invest, and will be open to customers with the relatively low amount of £500 to invest as a lump sum. “This signals the long-awaited entry of incumbents into a developing market that is being supported by policymakers and legislators,” comments Adrian Shedden, Head of FinTech at Burges Salmon LLP. “Of course, this all coincides nicely with PSD2 and Open Banking going live in January 2018. A cynic might say this is high street banks making a last minute play for customer retention before platforms are armed to facilitate their services using Open APIs.” / read more

On 5 July 2016, Germany’s Federal Competition Authority declared the German Banking Industry Committee’s online banking T&Cs illegal, holding that certain provisions preventing customers using PINs and TANs in non-bank payment systems restrict competition between providers of online payment services. Dr Carsten Lösing and Max Sergelius of White & Case LLP discuss the decision and its impact on online banking. / read more

Germany’s competition authority, the Bundeskartellamt, declared on 5 July 2016 that the ‘Special Conditions for Online Banking,’ imposed by the German Banking Industry Committee, are illegal. The jointly agreed rules, which are followed by all banks active in Germany, restrict online banking customers from using PINs and TANs in non-bank payment systems, which the Bundeskartellamt believes impedes the use of innovative non-bank payment solutions. / read more

The Financial Times reported on 25 May 2016 that bank customers with weak online security could be excluded from receiving compensation for fraud on their accounts in the event their account is hacked, under plans being drawn up by the Bank of England, GCHQ and the UK Government. / read more

The Financial Times reported on 25 May 2016 that bank customers with weak online security could be excluded from receiving compensation for fraud on their accounts in the event their account is hacked, under plans being drawn up by the Bank of England, GCHQ and the UK Government. / read more

The US Consumer Financial Protection Bureau (‘CFPB’) released in April 2016 its CFPB Report: Online Payday Loan Payments (‘Report’), which looked at online payday lending. This Report is based on the CFPB’s analysis of the bank account data of online payday loan borrowers and comes to the conclusion that the borrowers incur significant insufficient funds fees and bank account closures. However, H. Blake Sims, Partner at Hudson Cook LLP, has a number of concerns about the Report, particularly in regards to the CFPB’s ‘data-driven analysis,’ as he explains in this article. / read more

Hester Bais and Nadja van der Veer, two payments lawyers with a wealth of experience of the international payments industry, in this two-part article discuss store-within-a-store platforms, a business model where large online shops offer smaller online shops’ goods and services, in addition to their own products. Hester and Nadja, in this first installment, provide the background to their argument that E-Commerce Platforms (the term ‘E-Commerce Platform’ is used to describe both store-within-a-store and online marketplaces) that handle payment transactions should be legally regulated as financial institutions, specifically focusing on the approach taken by the Dutch Central Bank. / read more

The People’s Bank of China (‘PBOC’) released on 28 December ‘Administrative Measures for Online Payment Services of Non-banking Payment Institutions’ (‘Payment Measures’), to be implemented by 1 July 2016; also on 28 December the China Banking Regulatory Commission (‘CBRC’) published a draft document on online lending for public opinion (‘Lending Measures’). / read more

In November, the Polish Financial Supervision Authority (‘FSA’) issued a ‘Recommendation on the security of online payment transactions made by banks, national payment institutions, national electronic money institutions and savings and credit union’ (‘Recommendation’). This aims to harmonise the minimum requirements for the security of online payments in connection with the provisions of payment services. Maciej Gawronski and Joanna Galajda of Bird & Bird, assess the objectives of the Recommendation and the potential for conflicts to arise between payment service providers and consumers. / read more