Elon Musk's X Expands Payment License, Plus UK's Big Move on Interchange Fees

Elon Musk's X Expands Payment License, Plus UK's Big Move on Interchange Fees
Elon Musk X Super App

Hey FinTech Fanatic!

Elon Musk's social media platform X, took a step closer to offering payment features after receiving a money-transmitter licence from a 13th US State this week.

Recent developments have seen X successfully obtaining a payment processing license in 13 US states, including Pennsylvania, a move that signals the company’s commitment to becoming a significant player in the FinTech arena.

This strategic state-by-state expansion is crucial, as full nationwide coverage is necessary for X to offer comprehensive payment services across the US.

This approval empowers X to facilitate money transfers in a manner akin to established systems like PayPal's Venmo.

Payments are also tied into X’s broader move into the creator economy, where X users with at least 500 followers and 5 million organic impressions on their posts over the past three months can become eligible for ad revenue sharing.

Meanwhile, a major development has emerged from the United Kingdom, impacting neobanks and the broader FinTech sector.

The UK's Payment Systems Regulator (PSR) has proposed new caps on cross-border interchange fees, a move that could significantly alter the revenue models for many neobanks.

In its recent review, the PSR suggests capping fees at 0.2% for consumer debit transactions and 0.3% for consumer credit transactions between the UK and the European Economic Area (EEA). This change aims to reduce costs for UK businesses engaged in EEA transactions, marking a critical shift in the financial transaction landscape.

This proposal could disrupt the traditional revenue streams for neobanks, which often rely heavily on interchange fees from debit and credit card transactions. The recommendation for a "lasting cap" on these fees indicates a significant potential shift in how these banks will operate financially.

While these changes are still in the recommendation phase, they signal a broader movement towards more regulated interchange fees.

To be continued...

Don't forget to check out the extra FinTech news I've got lined up for you below 👇. I'll be back with more hot updates tomorrow.




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