Fintech Takes Alex Johnson

We have a lot of questions when it comes to Fed Master Accounts. And thankfully, Julie Hill, Vice Dean and Alton C. and Cecile Cunningham Craig Professor of Law at the University of Alabama, is here to answer them! 
In this special edition of Bank Nerd Corner, Julie helps Alex and Kiah unravel the many legal mysteries of the Federal Reserve’s Master Accounts. Julie breaks down the history of the Fed’s payment systems and explains how access to those systems (via Master Accounts) impacts banks and fintech companies.
How do these “bank accounts for banks” work? Which banks can get them? And what happens if access to them is taken away?
Kiah, Alex, and Julie discuss the role of the Fed as a payments facilitator, as opposed to a regulator, and unpack why it’s nearly impossible to make money in payments without having a Master Account.
And later, they dive into the troubling report of sexual harassment at the FDIC, and spend a few minutes marveling at (and ranting about) where bank routing numbers come from. 
 
00:01:56 - Understanding Federal Reserve Master Accounts
00:14:19 - Credit Union Applies to Serve Cannabis Industry
00:17:22 - Federal Reserve and American Samoa's Money Laundering Dilemma
00:27:57 - Federal Reserve's Transparency on Master Accounts
00:35:07 - Federal Reserve Announces New Supervision Team
00:45:01 - Federal Reserve's Role in Money Laundering
00:51:31 - FDIC Sexual Harassment Review Findings
00:59:46 - Collaborative Structures Improve Aviation Safety
01:02:55 - American Banking Association Still Provides Routing Numbers
 
TruStage Payment Guard Insurance is a first-of-its-kind insurance solution built for digital lenders, designed to help you attract more borrowers, strengthen your loan portfolio and reduce time spent on collections — all with minimal tech lift needed to go live.
 
To learn more about Payment Guard Insurance, visit https://www.trustage.com/payment-guard.
 
Sign up for Alex’s Fintech Takes newsletter for the latest insightful analysis on fintech trends, along with a heaping pile of pop culture references and copious footnotes. Every Monday and Thursday: https://workweek.com/brand/fintech-takes/
 
And for more exclusive insider content, don’t forget to check out my YouTube page.
 
Follow Julie: 
LinkedIn: https://www.linkedin.com/in/julie-hill-15929821/
Twitter: https://twitter.com/ProfJulieHill
 
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Twitter: https://twitter.com/khaslett
 
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Twitter: https://www.twitter.com/AlexH_Johnson

The tulips are blooming and the windmills are churning—so where in the world is Jason Mikula this week? Jason calls into the pod live from the beautiful Netherlands to break down the latest in fintech news with Alex. 
 
First on the plate? The final chapter in the Synapse bankruptcy saga. After Synapse sold all of its assets to TabaPay for $9.7 million and settled its dispute with Evolve, it appears all parties are walking intact from the ordeal. What did we learn? And what BaaS drama is coming next?
 
Uber announced it will be implementing pay-by-bank. Not terribly surprising given large merchants’ obsessive focus on reducing payment acceptance costs, but will smaller merchants follow suit? And what do consumers think of pay-by-bank?
 
Also, pardon our French, but tipping in fintech is complete and utter bullshit. Fintech companies are NOT college students struggling to pay the rent, so why are companies like Dave begging consumers for tips? And how is earned wage access legislation allowing it to be a thing? Alex and Jason go off about tips and discuss the future of EWA. 
 
Plus, Alex and Jason tackle the consent order between the CFPB and BloomTech before diving into this week’s “Can’t Let It Go” segment (and let’s just say that tech needs to grow a tougher shell). 
 
TruStage Payment Guard Insurance is a first-of-its-kind insurance solution built for digital lenders, designed to help you attract more borrowers, strengthen your loan portfolio, and reduce time spent on collections — all with minimal tech lift needed to go live.
 
To learn more about Payment Guard Insurance, visit https://www.trustage.com/payment-guard.
 
Sign up for Alex’s Fintech Takes newsletter for the latest insightful analysis on fintech trends, along with a heaping pile of pop culture references and copious footnotes. Every Monday and Thursday: https://workweek.com/brand/fintech-takes/
 
And for more exclusive insider content, don’t forget to check out my YouTube page.
 
Follow Jason:
Newsletter: https://fintechbusinessweekly.substack.com/
LinkedIn: https://www.linkedin.com/in/jasonmikula/
 
Follow Alex: 
YouTube: https://www.youtube.com/channel/UCJgfH47QEwbQmkQlz1V9rQA/videos
LinkedIn: https://www.linkedin.com/in/alexhjohnson
Twitter: https://www.twitter.com/AlexH_Johnson

Alex is back with the great and powerful Simon Taylor to unpack some of fintech’s most interesting fintech startups.
We’re barely beginning the month of May, and it looks like there’s yet another family credit card app to unpack—but this one actually feels different. Can Modak Makers succeed where other family cards have floundered? And how does its unique points rewards system for things like chores, sensible savings habits, and step count help it to distinguish itself from the pack?  
Then, Alex and Simon tackle Casap, a new customer-centric chargeback and dispute management system that firmly believes the customer is always right. But if the customer is a fraudster… should they always be right? The guys noodle on a few ideas about how it may (or may not) be possible to make a less fraud-friendly, more customer-centric app.
Plus, does anyone truly know how an HSA or an FSA works? Silver is certainly banking on it, and hoping that its HSA/FSA rebates program is enough to reel potential consumers in—but does it have a customer acquisition model worth its weight? 
And later, Alex and Simon cover Elpha Secure, the cybersecurity insurance app looking to bundle its software with its insurance service, before manifesting a few ideas about creating a dynamic pricing app and revamping the entire video game industry. 
 
TruStage Payment Guard Insurance is a first-of-its-kind insurance solution built for digital lenders, designed to help you attract more borrowers, strengthen your loan portfolio, and reduce time spent on collections — all with minimal tech lift needed to go live.
 
To learn more about Payment Guard Insurance, visit https://www.trustage.com/payment-guard.

02:09 Modak Makers
12:58 Casap
28:38 Silver
41:06 Elpha Secure
51:38 Manifesting Fintech Ideas

 
Sign up for Alex’s Fintech Takes newsletter for the latest insightful analysis on fintech trends, along with a heaping pile of pop culture references and copious footnotes. Every Monday and Thursday: https://workweek.com/brand/fintech-takes/
 
And for more exclusive insider content, don’t forget to check out my YouTube page.
 
Follow Simon:
LinkedIn: https://www.linkedin.com/in/sytaylor/
Substack: https://sytaylor.substack.com

Follow Alex: 
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Twitter: https://www.twitter.com/AlexH_Johnson

Elon Musk, Amy Rowe Klement, Peter Thiel, Julie Anderson, Max Levchin, Reid Hoffman. 
What do these powerhouse entrepreneurs all have in common? 
Hint: They all played a role in the meteoric rise of PayPal.
Find out the intricate web behind one of the biggest startups in the world, as Alex chats with the author of "The Founders: The Story of PayPal and the Entrepreneurs Who Shaped Silicon Valley," Jimmy Soni.
They dive into the history of PayPal and discuss the early days of the company, its vision, and the talented individuals who were part of its success. How did PayPal start as the result of a broken AC unit and a simple ploy to get free air conditioning from a college campus? How did Elon Musk’s role in PayPal fundamentally shape his views on banking? Find out how some of today’s most seminal minds collided and how things culminated into the height of Silicon Valley’s fintech revolution.
For a fascinating glimpse into one of history’s most fundamentally impactful fintech companies, you don’t want to miss this ep!
Read “The Founders” here.
 
TruStage Payment Guard Insurance is a first-of-its-kind insurance solution built for digital lenders, designed to help you attract more borrowers, strengthen your loan portfolio and reduce time spent on collections — all with minimal tech lift needed to go live.
To learn more about Payment Guard Insurance, visit https://www.trustage.com/payment-guard.
 
00:01:59 - Book on PayPal's Genius Team
00:09:02 - Paths Crossed: Silicon Valley Engineers
00:13:21 - Evolution of PayPal Founder's Ideas
00:19:21 - David Sacks: From Email to Product Officer
00:21:31 - Elon Musk's Early Banking Experience
00:24:03 - Elon Musk's Financial Services Interest
00:32:33 - eBay and X.com's Email Money Concept
00:39:13 - PayPal's Merger Against Elon's Will
00:44:32 - Shorting the Stock Market: Peter Thiel's Proposal
00:50:39 - PayPal's Evolution in Fintech Industry
00:52:24 - PayPal: From Startup to Modern Regulations
00:57:37 - Elon Musk's Vision for Efficiency
 
Sign up for Alex’s Fintech Takes newsletter for the latest insightful analysis on fintech trends, along with a heaping pile of pop culture references and copious footnotes. Every Monday and Thursday: https://workweek.com/brand/fintech-takes/
 
And for more exclusive insider content, don’t forget to check out my YouTube page.
 
Follow Jimmy: 
Website: https://jimmysoni.com/books/the-founders/
Book: https://www.amazon.com/exec/obidos/ASIN/1501197266
LinkedIn: https://www.linkedin.com/in/jimmysoni/
 
Follow Alex: 
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Twitter: https://www.twitter.com/AlexH_Johnson

In this super special edition of Bank Nerd Corner, Alex and Kiah are joined by Steven Kelly, the Associate Director of Research at the Yale Program on Financial Stability.
They dive into the Q1 Bank Earnings, debating exactly how much stock prices matter in determining bank health. Is there too much emphasis placed on the connection between stock prices and deposit runs at the bank? Kiah, Alex, and Steven debunk some of the biggest misconceptions about bank solvency and unravel how banks have always operated at negative equity—and why that doesn’t mean they won’t turn a profit eventually.
Later, Steven shares his insights into tokenization outside of its crypto origins and explains which aspects of the underlying blockchain technology regulators are most excited about. What are the downsides and risks? And despite crypto’s widespread problems, how will blockchain technology sustain outside of it?

Plus, the gang also unpacks the role of the FHLB in the banking system, discusses the explosive growth of private credit, and gets into a heated debate about the merits of… potatoes. Yep—you heard that right. Kiah has some *thoughts* about the mediocrity of potatoes. We never said they were correct though. 

TruStage Payment Guard Insurance is a first-of-its-kind insurance solution built for digital lenders, designed to help you attract more borrowers, strengthen your loan portfolio and reduce time spent on collections — all with minimal tech lift needed to go live.
To learn more about Payment Guard Insurance, visit https://www.trustage.com/payment-guard.
 
00:02:44 – Q1 Bank Earnings Released
00:18:21 – Tokenization
00:35:44 – The Federal Home Owned Bank
00:55:04 – Private Credit
01:04:32 – Go Off Kiah! 
Sign up for Alex’s Fintech Takes newsletter for the latest insightful analysis on fintech trends, along with a heaping pile of pop culture references and copious footnotes. Every Monday and Thursday: https://workweek.com/brand/fintech-takes/
 
And for more exclusive insider content, don’t forget to check out my YouTube page.
 
Follow Steven: 
LinkedIn: https://www.linkedin.com/in/sjkelly6/
Newsletter: https://www.withoutwarningresearch.com
 
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Twitter: https://www.twitter.com/AlexH_Johnson

 

Another week, another consent order.  
Welcome back to BaaS Island, where regulators keep throwing more bodies at the problem, hoping something will work.
Fintech Business Weekly’s Jason Mikula chats with Alex about the latest consent orders for Piermont and Sutton, as the duo debate whether or not “direct” has lost all meaning. Is it possible to really go “direct” from a fintech company to a bank without middleware? Too much regulatory authority has pushed banks away from doing everything except for technology, so in what form do regulators really want BaaS to survive in this current climate? 
Then, the guys debate whether or not 15% of American households actually use Chime. According to Ron Shevlin’s latest article for Forbes, Chime is poised to IPO with 38 million customers, on par with the likes of Wells Fargo. Does the math… math? Because the math certainly seems to be generous math…
Meanwhile, states want to protect their residents from out-of-state banks charging interest rates above state usury caps. Sure, it sounds like a good thing, but is it actually a good thing for consumers? 
And later, Alex and Simon talk about the misuse of the FDIC logo and the uptick in fintech Twitter trolls. Why can’t we all just get along?  Or at the very least, why can’t we all just say nasty things on Twitter without the protection of an anonymous handle? 
 
01: 45 – BaaS Island
22:15 – Chime
42:27 – Trade Groups vs. Colorado
53:30 – Misusing the FDIC Logo and Debating with Twitter Trolls

Sign up for Alex’s Fintech Takes newsletter for the latest insightful analysis on fintech trends, along with a heaping pile of pop culture references and copious footnotes. Every Monday and Thursday: https://workweek.com/brand/fintech-takes/
And for more exclusive insider content, don’t forget to check out my YouTube page.
 
Follow Jason:
Newsletter: https://fintechbusinessweekly.substack.com/
LinkedIn: https://www.linkedin.com/in/jasonmikula/
 
Follow Alex: 
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Twitter: https://www.twitter.com/AlexH_Johnson