According to a new survey, 54% of Americans are concerned about touching coins or bills due to COVID, while 60% plan to use so-called touchless payments in the future.
The findings are based on an online survey of 600 people conducted by Rapyd, a global payments company backed by digital payment giant Stripe. The survey also found that 45% of Americans want to see pennies phased out, while 5% want all coins to be eliminated.
In an interview with Fortune, Rapyd CEO Arik Shtilman said COVID has rapidly accelerated an existing trend of Americans ditching cash for other forms of payment.
Shtilman added, though, that it will take years before the U.S. resembles Asia, where phone-based digital wallets are ubiquitous. He said this is partly due to the large number of Americans who like to pay with cash, as well as the slow process of replacing existing point-of-sale systems—which rely on consumers using physical cards and signing receipts—with machines that can read digital wallets like Apple Pay.
The move away from cash could also be accelerated by governments around the world using COVID as a pretext to reduce the amount of coins and bills in circulation, Shtilman says.
In the United States, the pandemic has already produced a coin shortage in part due to decreased activity at laundromats, transit facilities and other places where Americans spend coins.
Meanwhile, the U.S. mint scaled back its coin operations in the spring over health concerns, but returned to full production in June. According to a recent Fortune report, the mint plans to produce 17.8 coins by the end of the year—7.4 billion more than last year—suggesting the federal government does not intend to use the pandemic to accelerate a move away from cash. The U.S. Mint did not immediately respond to a request for comment about its latest plans.
And while many younger Americans rarely touch cash, a fully cashless society is still far off, at least in part by design. As Fortune reported in June, several U.S. cities have introduced law requiring merchants to accept cash—in part because millions of Americans lack access to payment cards and other tools of the banking system.
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Time to Bottom Fish? Top Analyst Offers 3 Stocks to Buy
September saw some serious market losses, from 5% in the Dow to 9.5% in the NASDAQ. In the wake of it, investors must decide what those losses mean, and how it will impact investment strategy going forward. And for that, investment bank Oppenheimer has some suggestions.The firm’s 5-star analyst Ittai Kidron has tagged three tech stocks in which he sees plenty of room for near- to mid-term growth. Kidron is an expert in the market’s technology sector, and is rated among the Street’s 25 best analysts, with a 72% success rate to his forecasts and a 34.5% average return on his stock picks. Using TipRanks’ Stock Comparison tool, we were able to evaluate these 3 stock picks alongside each other to get a sense of what the analyst community has to say.Smartsheet, Inc. (SMAR)Kidron’s first pick is Smartsheet, an SaaS company with a cloud-based workspace management and collaboration system. Smartsheet’s products enable faster, more efficient teamwork via remote, letting team members automate, capture, manage, plan, and report on work at any scale. The company boasts over 97,000 customer – including 75% of the Fortune 500 companies. Smartsheet has enhanced its relevance in the online business space by making its product compatible with popular systems such as Dropbox, Google Apps, MSOffice, and Salesforce.Smartsheet's earnings – while still coming in at a net loss – beat the forecasts by wide margins in Q1 and Q2, and revenues grew steadily in the first half of the year, with the top line currently at $91.22 million. That last number – the company’s FYQ2 revenue – is up an impressive 41% year-over-year.In another impressive display of Smartsheet’s strength, the company announced last month that it is acquiring the digital asset management company Brandfolder, in a deal worth $155. The acquisition will add Brandfolder’s capabilities to Smartsheet’s products, helping customers to improve efficiency.Oppenheimer’s Kidron sees a clear path ahead for Smartsheet with this acquisition.“We suspect Brandfolder's annualized rev. run rate is still small… While we don't expect a material change to Smartsheet's near-term rev. run rate, we view it as a long-term positive from a diversification perspective. We also believe the acquisition can be quickly absorbed from a cost perspective over 1-2 quarters given Smartsheet's normal pace of investment…”Kidron sets a $65 price target on the stock, implying an upside of 42% for the coming year, and backing his Outperform (i.e. Buy) rating. (To watch Kidron's track record, click here)Overall, SMAR's Moderate Buy consensus rating is based on 9 Buys and 4 Holds set in recent days. The stock is selling for $45 and the average price target of $60.54 suggests room for 32.5% upside growth. (See SMAR stock analysis on TipRanks)New Relic, Inc. (NEWR)Next up is New Relic, another Silicon Valley tech company. New Relic’s products permit software analytics, allowing the customer to use a cloud system to track app performance in order to perfect the software. As New Relic says, it puts analytics, troubleshooting, and optimization all in one place for efficient engineering.The company has seen modest, steady revenue growth during 2020, and the CY2Q results put the top line at $162.6 million. The EPS net loss held steady in the first half, at 37 cents.Kidron is generally positive on New Relic, acknowledging headwinds but not shy about his belief that the company can overcome them.“While we expect the execution challenges to weigh on the shares near term, we also still believe there's value in New Relic One and demand for observationally in general… New Relic's taking an aggressive step to simplify its product positioning and pricing, which could make for a tough 2Q as sale/customers react. Given the increased uncertainty, we believe NT stock performance could be volatile as investors wait for proof points of customer renewals, new customer engagement, and better sales execution, which could emerge late in FY21,” Kidron opined.These comments are backed by Kidron’s Outperform rating (i.e. Buy), and his $75 price target implies an upside potential of 40% for the stock in the next 12 months.While the top analyst is bullish on NEWR, the stock only rates a Hold from the analyst consensus. New Relic has 4 Buy reviews, along with 6 Holds and 2 Sells. The stock is priced at $53.61 and has an average price target of $66.70, suggesting a 24% one-year upside. (See NEWR stock analysis on TipRanks)Twilio (TWLO)Last on our list today is Twilio, a cloud server company based in Silicon Valley. This company offers customers a cloud-based communications platform, allowing access to telecom systems via the computer. Twilio’s platform makes it possible for customers to place or receive phone calls, chats, text messages, and even video conversations via connected devices, and built-in security systems keep it safe through user verification.The sudden move toward remote work and virtual offices in 1H20, precipitated by the coronavirus crisis, would seem on its face to be a boon for a company like Twilio – and the data bears that out. The company saw revenues grow sequentially from 4Q19 to 1Q20, and broke $400 million in the second quarter. The company reported 200,000 active customer accounts at the end of Q1, up 5% year-over-year, and added another 10,000 in Q2. TWLO shares have gained 137% year-to-date; they seemed to shrug off the corona crisis.Kidron updated his notes on Twilio after hearing management’s Summer 2020 Releases webinar. He notes several important points that underlie the company’s fundamental strength: “Twilio now has 8M registered developers… Cumulatively, it has now reached 3 trillion emails processed… Twilio has made more progress in making its entire portfolio available for healthcare use cases now that Studio and Functions are HIPAA-compliant.”At the bottom line, Kidron says simply, “We're increasingly confident in Twilio's ability to make platform investments, engage with developers, and expand its lead over competitors during the crisis. Twilio remains a top pick.”In line with these comments, the analyst rates TWLO an Outperform (i.e. Buy), and his $300 price target implies a 28% one-year upside potential. (To watch Kidron’s track record, click here)Twilio holds a Strong Buy rating from the analyst consensus, based on 21 reviews including 17 Buys and just 4 Holds. Meanwhile, the average price target stands at $294.50, suggesting a 29% upside potential, and lining up nicely with Kidron’s outlook. (See Twilio’s stock analysis at TipRanks)To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
Check out Airbus’s concepts for the world’s first ‘zero-emission commercial aircraft’
A few months ago, the French government gave the country’s aerospace sector a $16.8 billion bailout, with one notable condition: around a tenth of the sum would need to be spent speeding up the development of a new, carbon-neutral airplane.
Airbus, the Toulouse-based European plane-building consortium, had already been working on a hybrid-electric prototype, but that project died in April, thanks to the coronavirus pandemic hitting both it and engine partner Rolls-Royce hard. What the French government was proposing was not electric power but hydrogen—and it wanted a plane ready by 2035.
On Monday, Airbus showed off its first concepts for the “ZEROe” aircraft. There are three of them and, while all rely on hydrogen power—a fact Airbus claims could lead to a halving of aviation’s CO2 emissions—they are otherwise quite different.
All three concepts look at least a little different from today’s aircraft, due to the requirements of storing and using hydrogen for power. The most radical design is for a “blended-wing body” that resembles a cross between a stealth bomber and a space shuttle. This one can carry up to 200 passengers.
Airbus’s “turbofan” design looks more traditional and, as the name suggests, uses a hydrogen-fueled gas-turbine engine. It can carry 120-200 passengers and has a range of over 2,000 nautical miles, making it viable for transcontinental flights.
The third design uses a turboprop engine, has half the range of the turbofan concept, and can carry up to 100 passengers.
“These concepts will help us explore and mature the design and layout of the world’s first climate-neutral, zero-emission commercial aircraft, which we aim to put into service by 2035,” said Airbus CEO Guillaume Faury in a statement.
However, as Faury also noted, the transition from emissions-tastic jet fuel to hydrogen won’t just require new planes and engine designs; it means the retooling of an entire ecosystem, from hydrogen transport to refueling facilities to, of course, airports.
“Together with the support from government and industrial partners we can rise up to this challenge to scale-up renewable energy and hydrogen for the sustainable future of the aviation industry,” Faury said.
If development of the concepts goes to plan, Airbus will officially kick off its ZEROe aircraft program by 2025, with a full-scale prototype arriving in the latter half of this decade.
However, the news did not do much for Airbus’s share price (down 3.5% at the time of writing) on a day when it, like many other travel-connected stocks, was feeling the pain of rising coronavirus case numbers and the likely impact this will have on the sector.
Despite the largesse of Emmanuel Macron’s government, Airbus was at the end of June forced to announce 15,000 job cuts. The crystallization of aviation’s potentially hydrogen-hued future does nothing to change the fact that, in 2020, airlines are far more preoccupied with staying alive than they are with taking on new aircraft—though the pandemic is at least encouraging carriers to retire their older gas-guzzlers more rapidly than might otherwise have been the case.
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- An electric revolution is coming for American trucking
- Uncharted Power’s Jessica O. Matthews has a plan to revive America’s crumbling infrastructure
- Trump has long wanted to kill a Russia-Germany natural gas pipeline. Navalny’s poisoning could do it for him
- Is oil giant BP finally ready to think outside the barrel?
Sustainable finance is paving the way for post-pandemic recovery
Sustainable finance is more than simply issuing green, social, and sustainability bonds. More broadly, it refers to a process of taking environmental, social, and governance (ESG) considerations into business decisions — particularly on investment and lending. Environmental considerations usually refer to climate change, deforestation, and natural resource use. Social considerations, on the other hand, refer to human rights and labor issues, human capital development, inequality, community relations, and health and safety. Governance considerations refer to a company’s corporate structure and board oversight, its code of business ethics and values, transparency and reporting.
These sustainability and ESG considerations also apply to the value chain of an organization — including business practices, supply chains, and employees. This allows financial institutions to manage environmental and social risks that may impact other financial risk categories — credit, operational, reputation, and market risks.
BPI’s own sustainability journey formally started in 2008 when we signed up with the International Finance Corp. (IFC) to participate in their Sustainable Energy Finance Program. Since 2014, we have adopted the concept of shared value where we promote products and services that help solve social and environmental problems and at the same time create economic value. We identified three focus areas: Financial Inclusion and Wellness — widening our reach to underserved segments of society through our microfinance business, Scaling Up Enterprises — supporting SME businesses to help them grow, and Financing Sustainable Development — financing projects that support the UN Sustainable Development Goals. All of these are underpinned by prudent risk management and supported by the bank’s delivery infrastructure.
This year, we are not only enhancing our shared value framework but are working to align this with the BSP Circular 1085 on Sustainable Finance Framework issued in April 2020. The circular mandates banks to integrate sustainability principles, including those covering environmental and social risk areas, in their corporate governance framework, risk management systems, and strategic objectives suitable for their size, risk profile, and consistency of operation. The circular provides banks a transition period of three years to fully comply and put in place the policies, systems, and management oversight for sustainability and environment and social risks.
CHANGING THE FACE OF BANKING
The past six months of this global health crisis has revealed the financial and economic implications of social risks — reinforcing the urgency of managing environment and social risks. Thus, the issuance of the central bank’s Sustainable Finance Framework Circular has come at an opportune time as financial institutions are recalibrating their strategies to ensure survival and business continuity, taking into account the long-term social and economic effects of the pandemic.
The banking industry’s response to the pandemic has shown the importance of integrating sustainability in all aspects of the business. At the start of the quarantine, our main focus was to ensure the health and safety of our employees and to continue to provide banking services to clients. Despite limited mobility and health regulations, we kept our branches open on a rotational basis. We provided work tools to employees to allow them to effectively work from home. All this to reduce the health risk exposure of our people.
Our strategy to focus on digital transformation a few years ago has allowed us to provide clients with access to their accounts through robust online and mobile platforms. During the ECQ, we saw a significant increase not only in banking transactions through the digital channels, but a four-fold increase in digital enrollments from clients who previously would only transact in the branches. COVID-19 has reinforced this trend which is likely to continue once the crisis has passed, leading to the strategic rationalization of the bank’s brick and mortar channels, allowing for reduced carbon footprint and less exposure to health risks. And for more complex financial services and for enhanced customer experience, hybrid digital and in-branch solutions are being explored.
With a higher volume of digital transactions, we also saw the increased importance of creating awareness on cybersecurity, requiring us to ramp up client communication on how to spot scams and safeguard their account information.
The challenges presented by the COVID-19 pandemic also opened opportunities to tap the debt capital markets to refinance the bank’s MSME loan portfolio. The COVID Action Response Bonds or CARE Bonds, issued under the ASEAN Social Bond Framework, generated strong investor demand, with total subscriptions reaching P21.5 billion.
For the financial sector, the current crisis has accelerated trends that were already underway: digitalization — online services becoming an integral part of retail banking; focus on cybersecurity — privacy and data protection; resilience of sustainable investments; and the importance of addressing social issues — inequality, access to finance, healthcare, employment. This far-reaching crisis of course will require a coordinated response from all sectors of society. The local banking industry is in a unique position to play a vital role in the post-pandemic economic recovery by providing access to financing to the hardest-hit sectors, and also in transitioning to financing practices that encourage businesses to take sustainability into account. Regulators and investors have recognized that sustainable finance has economic as well as environmental and social benefits, which is why it continues to gain traction.
This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or the MAP.
Maria Theresa Marcial is a member of MAP, Chief Finance Officer of Bank of the Philippine Islands, and Trustee and Treasurer of WWF Philippines.
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