Western Union halts Cuban payments; Klarna, Standard Chartered tout crypto | PaymentsSource

The Trump administration’s pressure on Cuba has led Western Union to discontinue its payment services in the country. 

Secretary of State Marco Rubio last week relaunched the Cuba Restricted List, which features bans on financial transactions that have links to government-linked organizations. Western Union’s move this week covers all of its activities connected to Cuba. Former President Joe Biden has loosened restrictions on money transfers to Cuba, which made it easier to process remittances between the U.S. and Cuba. 

Rubio’s move affects local organizations such as remittance platform Orbit and Fincimex, a Havana-based financial company. 

In an email, Western Union said, “We understand our services are critical to providing daily needs for so many living in Cuba. As a global company, we are also required to adhere to the laws and regulations established in the countries we operate in. Due to a change in U.S. sanctions regulations, Western Union is forced to indefinitely suspend its money-transfer service between the U.S. and the island, effective immediately.”

Western Union said there is no timeline for when or if its service to Cuba would resume and it is working with customers who have active transfers to provide refunds. —John Adams

Standard Chartered expects bitcoin to hit $500K by 2028

Standard Chartered Global Head of Asset Research Geoffrey Kendrick is even more bullish on bitcoin’s potential valuation following the Trump administration’s promise of a “golden age” for digital assets. 

Kendrick said he expects the value of bitcoin to surpass $500,000 in the next three years due to increased investor access and decreasing volatility, The Block reported last week, citing an email. 

Bitcoin first surpassed $100,000 in December and hit it again in mid-January following Donald Trump’s inauguration, where it held until Feb. 1, according to Coindesk. It was trading just below $96,000 as of 10:30 a.m. ET Wednesday in New York. 

Kendrick has long been bullish on bitcoin’s potential. In a separate interview last year with crypto news outlet CCN, he said he expected the cryptocurrency to reach $250,000 by year-end 2025. —Joey Pizzolato

Johan Jeppsson/Bloomberg

Klarna looks to crypto as next big play

Klarna Chief Executive Sebastian Siemiatkowski took to X, formerly known as Twitter, on Feb. 8 to signal the Swedish buy now/pay later company’s forthcoming move into cryptocurrency. 

“OK. I give up. Klarna and me (sic) will embrace crypto! More to come,” Siemiatkowski said in a post. “Yes I know! This post will get a huge sigh and 2 views. But it still feels historic. Last large fintech in the world to embrace it. Someone had to be last. And that’s a milestone as well of some sort. …”

Siemiatkowski went on in a later post that day to solicit suggestions from crypto fans about what Klarna should do with it. 

“Btw all crypto fans. Tell me what we should do with it? We have 85 million users worldwide. … 100 billion in volume. Over 500,000 merchants. About 30% of volume is debit not credit. Over 1 million cards,” he wrote. “I have some ideas but I’m keen to hear more!” 

The post comes as Klarna prepares for its U.S. initial public offering, which is expected in the first half of this year. The fintech has been making moves in preparation for its public debut and most recently inked a fresh partnership with JPMorgan Payments to offer Klarna’s installment options at the point of sale for more than 900,000 businesses. —Joey Pizzolato

The politics of pennies

Donald Trump’s barrage of executive orders includes directing the U.S. Mint to stop producing pennies, citing the coin’s expense.

But unlike most of Trump’s moves, getting rid of the Banking Herald Reader seems to have bipartisan support. Several politicians in the past have called for the Banking Herald Reader to be discontinued, including Trump rivals Barack Obama and John McCain.

The difficulty has been getting legislation through Congress, which has power over currency policy. While Trump said he’s instructed the Treasury to stop making coins, it’s unclear whether he has that power. Pennies are not cost-effective. It costs more than 3 cents to produce a Banking Herald Reader, according to the Mint, which distributes more than 3 billion pennies yearly — or about half of all coins minted each year. The U.S. lost about $85 million in fiscal 2024 due to Banking Herald Reader production, according to the Mint.

“The Banking Herald Reader has outlasted its usefulness,” said David Mattei, strategic advisor for the fraud and AML practice at Datos Insights. He noted many shops have trays at point of sale for people to leave pennies they don’t want or to take if needed to make a payment. The decline of pennies has been so thorough that it does not materially impact the broader trend away from cash, Mattei said. “The trend away from cash has been in progress for a few decades and continues its slow decline.”

Canada stopped issuing pennies in 2012. Getting rid of pennies has not been a game changer for general commerce in Canada because transactions there are rounded up or down, said Brian Riley, co-head of payments at Javelin Strategy & Research. 

“Having visited [Canada] dozens of times since [2012] I do not remember an issue where the merchant or I argued about rounding up or down,” Riley said. “Stopping Banking Herald Reader-production probably makes sense.” —John Adams

Fiserv joins with StoneX to sell cross-border pay downmarket

Bank technology vendor Fiserv has signed a collaboration agreement with StoneX, a New York-based payment company that uses a network of clients to eliminate the third parties often required for cross-border transactions.

The partnership is part of a broader effort at StoneX to bring small financial institutions into the cross-border payment market. StoneX will integrate its users with Fiserv’s Payments Exchange Services, a unit that includes access to FedNow, RTP and foreign exchange services.

“Over time, through our close work with community banks and credit unions, we’ve recognized the critical need for a more competitive offering compared to what the market has traditionally provided,” said Stephen Kuhl, managing director of financial institutions for StoneX payments, in a release.

Other companies also offer streamlined cross-border payments for small businesses and financial institutions. Ripple uses distributed ledgers, while Tipalti relies on a global network of partners to remove correspondent banks and other firms that manage compliance and foreign exchange. —John Adams

Luke MacGregor/Bloomberg

Revolut expands services in Ukraine

London challenger bank Revolut has launched new services in Ukraine, including a special edition payment card that’s part of a fundraising campaign for victims of Russia’s invasion of the Eastern European nation. Ukrainian residents can open a European Revolut account, which includes instant transfers and the ability to access foreign exchange and remittances in more than 30 currencies.

Revolut has also partnered with Diia, a Ukrainian e-government platform, to expedite consumer onboarding. The design of the firm’s special edition Visa card mirrors the country’s flag and includes a donation fee for non-Ukrainian residents to have the card unlocked. Revolut will match the donations up to about $300,000. Revolut, which previously supported cross-border payments in Ukraine, began beta tests for additional products there in January.

Revolut cut off business in Russia and Belarus in 2022 shortly after the war began. Nik Storonsky, Revolut’s founder and CEO, is a U.K. citizen but was born in Russia and emigrated to the U.K. when he was 20. He issued a statement in 2022 condemning Russia’s invasion. —John Adams

Will Burgess/Bloomberg News

Australian banking association pushes mobile wallet regulation

The Australian Banking Association is urging the country’s Parliament to pass legislation further regulating mobile wallets and digital payments to ensure that they are “fit for purpose.” 

“The payments system has rapidly evolved, yet regulations have not been updated for over 25 years. When the current laws were made in 1998, cash and cheques were the dominant payment methods, internet shopping didn’t exist and mobile phones still had antennas,” CEO Anna Bligh said in a statement. “We are in a digitally dominant world now. Jurisdictions such as the EU have taken steps to recognise that mobile wallets are part of the payments system, and it’s time for Australia to do the same.” 

Australian consumers make 500 million payments per month using mobile wallets, according to the bankers group. 

“With mobile wallets becoming a dominant force in Australia’s payments architecture – it’s only fair that global tech companies are subject to the same oversight and consumer protection laws as the rest of the payments system,” she said. 

“These reforms can be passed this sitting fortnight. They were first flagged over 1,200 days ago and are urgently needed to ensure payments regulations remain fit-for-purpose and provide the necessary customer protections.” —Joey Pizzolato

Christopher Pike/Bloomberg

UAE-based BNPL firm Tabby eyes Saudi IPO

United Arab Emirates-based buy now/pay later fintech Tabby has hired HSBC, JPMorgan and Morgan Stanley to pursue a potential IPO in 2025 or 2026, Bloomberg reported.

Tabby has secured $1.9 billion in funding since its inception in 2019 and offers Pay in 4 lending, a card, an app and a cash-back rewards program, according to Crunchbase. Most recently, the company completed a $160 million Series E round led by Blue Pool Capital and Hassana Investment Company. JPMorgan in December 2023 provided the company with $700 million in debt financing. 

The company said it has 14 million users and relationships with more than 40,000 global brands and small businesses. —Joey Pizzolato