
The first mile problem in Fintech - tomasien
https://medium.com/@charlestm/the-first-mile-of-fintech-b48db8b21897
======
bosco
"a critical piece will be solving the first mile problem by making sure that
we lower the cost and the effort required of all of us when it comes to
transitioning into new payments and monetary systems."

This. Right now the costs to start a fintech company that actually does
something disruptive is tremendously high and the regulatory hurdles don't
stop. Luckily there are a few startups paving the way but it's still not
enough.

~~~
tomasien
I know I'm biased but I really and truly believe we're helping solve this. We
remove the need to build out ACH processing with a bank, do the regulatory
work for you, and roll in a pretty cool account ownership verification piece
out of the box. No ODFI needed, no Yodlee needed, plus if you want we'll
guarantee the funds so you don't even need to take float risk or monitor
returns. We do it pretty damn cheap.

I'm writing this not so much to make a pitch (of course that's part of it) but
to point out what I hope other fintech companies do: package UX and compliance
together and sell it for a reasonable cost. It will help the whole industry
explode into the potential investors are clearly seeing in it.

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fragmede
The article offers a promising future for "FinTech" without giving any reasons
_why_. Paypal, started in 1998 _was_ the promising new future, but that future
has fallen flat. Their list of prohibited businesses[1] reads almost the same
as Stripe's[2], which, for a business that is trying to fix the pain in
'online payment processing' is shameful, but business as usual. (It also
doesn't do a great job of defining its usage of 'first mile' vs 'last mile'.)

Is there anything that has changed that changes the legal landscape which
would allow for any innovation? The SEC announced that it was considering
change to the standards for being an 'accredited investor' but as far as I'm
aware, ultimate didn't go anywhere. This would have made crowdfunding
platforms much more tantalizing but didn't seem like it would have affected
the larger marketplace.

Money laundering is very much still a crime, and shows no chance of changing
anytime soon, but the requirements borne out of that are onerous (KYC) and
most banks are not going to keep an account that has large sums of money going
in and out of it open for very long.

The problem with finance was never the technology (Western Union's person-to-
person money transfer service dates back to 1871!) but always the regulation,
which, again, shows no evidence that anything will change.

[1][https://www.paypal.com/us/webapps/mpp/ua/acceptableuse-
full](https://www.paypal.com/us/webapps/mpp/ua/acceptableuse-full)
[2][https://stripe.com/us/prohibited-
businesses](https://stripe.com/us/prohibited-businesses)

~~~
tomasien
The primary reasons people believe Fintech is primed for explosion are the
following:

1\. Ubiquity and mobility of the internet. Paypal was designed for when the
internet was new and barely anyone was using it. Now, everyone is on the
internet and on it constantly with devices that have way more powerful. Now is
the time for just about any innovation that was promised but not fulfilled in
the first dot com bust to have another shot.

2\. Stirrings all around - talk to any bank and ask them if they think
financial technology is about to break out. They're pretty much all convinced
it is because they see it pecking at the edges. Alternate lending just has 2
IPOs 10 days apart (on deck, lending club), crypto currencies are surprisingly
stable given what they are and how new they are, and new payment tech is
gaining traction (apple pay, google wallet, square, venmo, etc). It all starts
small but it's gaining traction faster than it used to, and momentum is
everything.

That's what I've seen and what I've heard as the two biggest reasons.
Essentially, reach and momentum.

------
charlestm
Hey all, thanks for taking a look at my article. Would love to hear your ideas
on closing the first mile gap.

~~~
davidgerard
* Solve at least one problem ordinary people actually have.

e.g. Bitcoin conspicuously fails at this. There is nothing the typical
consumer can do with it that they can't already do with credit cards or
PayPal, and those offer chargebacks and rollbacks in case of problems. Even
remittances turn out to cost more in practice.

What can you do that existing centralised systems don't already do? And
remember that Shit Happens, and rollback is considered an essential function
by the trepidatious.

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rollypollybear
Utterly pointless article.

~~~
tomasien
Utterly pointless comment

