Saturday, April 14, 2007

Internet Money Day

It’s the Grand National today. That’s a great big horse race which generates millions of pounds in betting. If you bet on Silver Birch then you won. If you bet on the United Kingdom’s internet payment infrastructure holding up then you would be less lucky.

Things went wrong yesterday. Visa’s payment system went down. One in five transactions failed and the rest were likely to be approved by the banks’ without some of the usual checks with Visa. Mastercard’s 3D secure was also down.

There aren’t many PPC agencies out there which monitor payment services and put appropriate campaigns on pause or on “slow” while there are problems accepting cards.

I would imagine those companies which move money from the bookies to the banks where extra nervous today. I picked up rumours that ISP Pipex picked today, of all days, to run several key centres on generators rather than on main power. As it happens it’s Pipex who currently act as suppliers to those vital money-moving companies.

Did you know that the maximum BACS transfer is £9,999,999.98? Yes, I’m afraid that if you want to pay me £20m, then you’ll have to do it in three BACS transfers (or cash is fine). I wonder how Google will transfer all those millions (and billions) to DoubleClick’s investors.

This week Google launched Google Checkout in the UK. This would mean that Google would have to be regulated by the UK’s Financial Services Authority (FSA). As it turns out Google is not regulated by the FSA at all – so what’s going on? We have a new company; Google Payment Limited. Google Payment Limited (GPL) is regulated by the FSA. This means that GPL must keep $1,000,000 in cash so that it can repay all these electronic transfers if Google Checkout falls on its face. In fact, GPL needs to have more cash held in reserve if their electronic payment exposure exceeds $1,000,000.

GPL’s Directors have also been rated as an “approved person” by the FSA. At this point I am not clear whether Google’s senior American staff or senior British staff are acting as GPL’s Directors.

2 comments:

Anonymous said...

Hi, perhaps you should check before you post "rumours" on the internet. Pipex did NOT "choose" to run "several key centres" on generators. There was only one data centre involved in the planned maintenance which was undertaken by the landlords of the building - the choice of date was, I agree, unfortunate, but this choice was not made by Pipex. As it happens, no customers were affected by this maintenance.

Chris said...

All financial organisatione require, at the very least, their CEO to be FSA approved. This takes time to gain and I'd assume that who ever is at the top of GPL would come from a solid banking background.

Its common for other board members to alsop be approved, particularly the FInancial director - as far as i'm aware they don't need to be approved to be able to trade, however i think its usually a by-product of their former career movements that they are approved. A vast number of financial directors move onto CEO (or indeed have come from) positions after all.

Another good blog post Andy.