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The most important asset of any financial institution is trust. Banks, fintechs need utmost trust from customers in order to run their business their business.

The most important asset of any financial institution is trust. Banks, fintechs need utmost trust from customers in order to run their business their business. Imagine Wirecard customers debating if they will continue to use Wirecard as payments as processor considering that they can't manage neither account for their own money.

gizmo 6y ago
> fintechs need utmost trust from customers in order to run their business Wirecard has been repeatedly and very credibly accused of fraud and of cooking their books for the past decade. Clearly customers don't care otherwise they wouldn't have had any. Wells Fargo fraudulently created millions of fake checking and savings accounts. Did it break the "utmost trust" you assert is required? No. RBS was found insolvent after the 2008 financial crisis. Surely insolvency violates this "utmost trust" benchmark? Haha. No. Barclays was found guilty of fixing interbank interest rates (Libor). Massive scandal that was all over the newspapers. And yet, same question, same answer.
- duxup 6y ago
  >Clearly customers don't care otherwise they wouldn't have had any. Or they don't know.
- JumpCrisscross 6y ago
  In none of the cases of Wells Fargo, RBS or Barclays did institutional clients lose money. Wirecard May cause that. That’s the difference. Scandalous banks that keep my money aren’t great, but I’m not going to rush to stop banking with them.
  - SideburnsOfDoom 6y ago
    In the case of RBS, the UK government stepped in, in November 2008, and "became the majority shareholder". That protected the institutional clients by keeping RBS in business. I recall someone saying a couple of years later that RBS was a Bank, in the same sense that the Heritage Railway Association was a Train Operating Company. Harsh and funny, but with some truth to it.
- StupidPeople 6y ago
  Wells Fargo fraud only impacted foolish people who don't check their bank statements. If you did, you complain and the accounts go away. Many banks were insolvent after 2008. The government fixed that. Libor fixing us too complicated for most to understand and it mostly hurt you if you didn't ship around. I'm fine with fraud as long as it mostly hurts those who can't be bothered. Still a happy client of Wells Fargo. Wirecard has the problem of impacting diligent people who will actually take action against them.
  - lazylizard 6y ago
    I'd really prefer a bank i don't have to check and complain about. And maybe not just my bank.
rini17 6y ago
There were numerous reports of PayPal withholding funds for unknown reasons and ruining people and businesses. Did these dent the trust? Seems not at all.
- close04 6y ago
  I'm not sure if this is a matter of trust or lack of choice in this case. There simply aren't too many options to achieve the same results as with PayPal. Every site I go to gives me several payment options but the only ones present across every one are PayPal and card payment. So if that's what the buyer uses, the seller doesn't get much of a choice either.
  - A4ET8a8uTh0 6y ago
    This. Based on the offerings I saw, Paypal is noticably cheaper than other options for basic small business use case ( minor ebay shop, small online store ). The charges are straighforward and easy to predict. Compare that to most other providers and you find yourself digging through reams for legalese with fees calculations that are ridiculously complex and, seemingly, designed to deceive. I am not a big fan of Paypal and heavens know it has some major issues to address, but the entire field kinda sucks in its own unique way.
    - cptaj 6y ago
      I think the biggest issue with the entire field is not respecting the users. They're treated as potential criminals, their livelihoods and money are not respected at all, they have no recourse to protest administrative action, etc. Its a terrible experience overall. It has gotten better but still leaves a lot to be desired
      - PeterisP 6y ago
        Just like there's no way around the fact that a large portion of email is spam, there's no way around the fact that in the field of receiving money on internet, a substantial niche of potential users actually are criminals. Their volume of transactions is quite large, they are sophisticated and eager to try out new services, and they can rapidly direct the flow of (many) fraudulent payments to a new payment service provider or scale the exploitation of some cash-out system to thousands of accounts managed dozens of actual people (generally 'money mules' who get scammed themselves). So if your service is friendly to that group of customers, no matter if accidentally through some process flaw or intentionally (because you're not treating criminals creating accounts as potential criminals), then you can (and will) suddenly get a lot of criminal activity. For a small service, as soon as organized criminals notice that your policies allow them to use you for making fraudulent transactions, they can quickly bring in much more transactions that any of your marketing activities. The general result of doing what you propose is that it works until criminals notice a particular vulnerability in your processes/policies caused by excessive trust in users, and then suddenly you get a LOT of fraudulent activity which makes all your operations unviable. I've seen small merchants get a tenfold increase in transactions over a single week, with all of that increase being fraud, enabled by some weakness that is massively exploited until they close the weakness. Or close their business - for a small business, a single major fraud campaign can easily be enough to bankrupt them.
needusername 6y ago
As a merchant you chose Wirecard because no other acquirer wants you business, see FriendFinder.

gizmo 6y ago

> fintechs need utmost trust from customers in order to run their business Wirecard has been repeatedly and very credibly accused of fraud and of cooking their books for the past decade. Clearly customers don't care otherwise they wouldn't have had any. Wells Fargo fraudulently created millions of fake checking and savings accounts. Did it break the "utmost trust" you assert is required? No. RBS was found insolvent after the 2008 financial crisis. Surely insolvency violates this "utmost trust" benchmark? Haha. No. Barclays was found guilty of fixing interbank interest rates (Libor). Massive scandal that was all over the newspapers. And yet, same question, same answer.

duxup 6y ago
>Clearly customers don't care otherwise they wouldn't have had any. Or they don't know.
JumpCrisscross 6y ago
In none of the cases of Wells Fargo, RBS or Barclays did institutional clients lose money. Wirecard May cause that. That’s the difference. Scandalous banks that keep my money aren’t great, but I’m not going to rush to stop banking with them.
- SideburnsOfDoom 6y ago
  In the case of RBS, the UK government stepped in, in November 2008, and "became the majority shareholder". That protected the institutional clients by keeping RBS in business. I recall someone saying a couple of years later that RBS was a Bank, in the same sense that the Heritage Railway Association was a Train Operating Company. Harsh and funny, but with some truth to it.
StupidPeople 6y ago
Wells Fargo fraud only impacted foolish people who don't check their bank statements. If you did, you complain and the accounts go away. Many banks were insolvent after 2008. The government fixed that. Libor fixing us too complicated for most to understand and it mostly hurt you if you didn't ship around. I'm fine with fraud as long as it mostly hurts those who can't be bothered. Still a happy client of Wells Fargo. Wirecard has the problem of impacting diligent people who will actually take action against them.
- lazylizard 6y ago
  I'd really prefer a bank i don't have to check and complain about. And maybe not just my bank.

rini17 6y ago

There were numerous reports of PayPal withholding funds for unknown reasons and ruining people and businesses. Did these dent the trust? Seems not at all.

close04 6y ago
I'm not sure if this is a matter of trust or lack of choice in this case. There simply aren't too many options to achieve the same results as with PayPal. Every site I go to gives me several payment options but the only ones present across every one are PayPal and card payment. So if that's what the buyer uses, the seller doesn't get much of a choice either.
- A4ET8a8uTh0 6y ago
  This. Based on the offerings I saw, Paypal is noticably cheaper than other options for basic small business use case ( minor ebay shop, small online store ). The charges are straighforward and easy to predict. Compare that to most other providers and you find yourself digging through reams for legalese with fees calculations that are ridiculously complex and, seemingly, designed to deceive. I am not a big fan of Paypal and heavens know it has some major issues to address, but the entire field kinda sucks in its own unique way.
  - cptaj 6y ago
    I think the biggest issue with the entire field is not respecting the users. They're treated as potential criminals, their livelihoods and money are not respected at all, they have no recourse to protest administrative action, etc. Its a terrible experience overall. It has gotten better but still leaves a lot to be desired
    - PeterisP 6y ago
      Just like there's no way around the fact that a large portion of email is spam, there's no way around the fact that in the field of receiving money on internet, a substantial niche of potential users actually are criminals. Their volume of transactions is quite large, they are sophisticated and eager to try out new services, and they can rapidly direct the flow of (many) fraudulent payments to a new payment service provider or scale the exploitation of some cash-out system to thousands of accounts managed dozens of actual people (generally 'money mules' who get scammed themselves). So if your service is friendly to that group of customers, no matter if accidentally through some process flaw or intentionally (because you're not treating criminals creating accounts as potential criminals), then you can (and will) suddenly get a lot of criminal activity. For a small service, as soon as organized criminals notice that your policies allow them to use you for making fraudulent transactions, they can quickly bring in much more transactions that any of your marketing activities. The general result of doing what you propose is that it works until criminals notice a particular vulnerability in your processes/policies caused by excessive trust in users, and then suddenly you get a LOT of fraudulent activity which makes all your operations unviable. I've seen small merchants get a tenfold increase in transactions over a single week, with all of that increase being fraud, enabled by some weakness that is massively exploited until they close the weakness. Or close their business - for a small business, a single major fraud campaign can easily be enough to bankrupt them.

needusername 6y ago

As a merchant you chose Wirecard because no other acquirer wants you business, see FriendFinder.