Hunter Albright

Vizualisation of "The Crisis of Credit"

I came across this animated video the other day by Jonathan Jarvis. It is worth a look if you want an easy to digest way to understand the forces behind the credit crunch.

The Crisis of Credit Visualized from Jonathan Jarvis on Vimeo.

Interaction and Media Designer, Jonathan Jarvis created this animated infographic in part to help himself understand what was happening as the financial system began to melt down at the end of 2008.

via vizthink.com

Improved Security for Consumers - Online and Offline

Visa has launched a payment card in Europe that contains a keypad and an eight-character display for showing a one-time passcode, an additional defense against potentially fraudulent Internet transactions.

via www.pcworld.com

Will you spend more on your credit and debit cards if your transaction are more secure?  That is what the Visa is hoping.

In launching the One-Time Passcode cards in Europe, Visa is moving forward payment card security for both online and offline transactions. Since the technology does not require any additional kit, like a number of other authentication methods, consumers are more likely to use it based on its simplicity and increased security.

Consumer protection plans are a mixed bag for financial services

CONSUMER PROTECTION

Ban excessive interest rates on credit and store cards. Introduce seven-day "cooling-off period" for store cards. Make credit card companies provide better information to customers in "uniform electronic format that will allow consumers to find out whether they are receiving the best deal". Measures to end "unfair" bank charges.

via news.bbc.co.uk

The Coalition Government today announced more details of their plan.  Consumer Protection was one of the areas that featured and their policies will have an impact on consumers and banks alike. 

Their policies outline a continued push for greater transparency within the financial services industry.  They include a "cooling-off period" when taking out a store card and a mandate to make more product information available in an electronic format so that customers can more easily compare products. 

I believe that both of these policies have the potential to help improve the industry from a reputation point of view as well as from a performance point of view.  In my opinion, the banks should should want and be striving to have consumers to take out and keep their products because they provide good value and a quality service.  Therefore, the additional information disclosure and a "cooling-off period" should have minimal impact if their products meet the mark.

With respect to the policies that are targeting the regulation of pricing, in terms of interest rates and "unfair" banking charges, I am less supportive of these.  I believe these changes will ultimately limit competition and innovation in the market.  We should be seeking to have consumers fully understand the products that they are considering and then make an informed choice while allowing the industry to develop and price products for different types of consumers.

A big change...but for what benefit?

An independent commission will also be established to look at breaking up banks into their retail and investment banking arms to reduce risk.

via news.bbc.co.uk

As part of the policies outlined today by the Coalition Government, there is a plan to investigate the separation of the retail and investment banking businesses. It is claimed that this would help to reduce the risk associated with the banking industry and that it would help make the it more fair.

I am very sceptical of the benefits of such a move. For me is unclear how consumers and businesses would benefit from the complexity and risks that would be introduced as part of this change.

Good News for Payment Card Industry

Volume of retail sales, all retailers, seasonally adjusted

via www.statistics.gov.uk

In the latest statistics out today, retail sales up are month-on-month and year-on-year.  One of the more encouraging aspects of these statistics for the payment card industry is the growth of non-food purchases which will largely have been paid for with either a debit or credit card.