U.S. Bank promotes Carstensen; BNPL gets a boost for the holidays

November 27, 2024 2:10 PM

In this week's banking news and global payments roundup: U.S. Bank appointed insider Kristy Carstensen to lead its global treasury management and prepaid card business; Affirm added a new sporting goods retailer to its list of partners; Klarna said it plans to invest in a new innovation hub in Poland; HSBC launched its own BNPL offering; and more.

U.S. Bank's Kristy Carstensen will lead global treasury management, prepaid cards

U.S. Bank appoints insider to lead global treasury management, prepaid cards

U.S. Bank has selected a new head of global treasury management and prepaid cards. The banking subsidiary of Minneapolis-based U.S. Bancorp announced in a press release that it promoted Kristy Carstensen to the job, which oversees the department that provides treasury management and payment solutions to the bank's business, government and institutional clients. Carstensen, who joined U.S. Bank in 2011, was most recently the chief financial officer for payments, one of the bank's three core business lines. She succeeds Rick Erario, who retired in October, a company spokesperson said in an email. In her new role, Carstensen reports to Jeff Jones, president of corporate payment and treasury solutions, the spokesperson said. U.S. Bancorp recently announced that it would split its payments business into two divisions — merchant and institutional payments, and consumer and small-business payments. —Allissa Kline

Gabby Jones/Bloomberg

Affirm adds sports retailer to list of partners

Buy now/pay later fintech Affirm has added sporting goods and outdoor retailer JD Sports to its list of partners, Affirm announced on Wednesday.

JD Sports customers can now use Affirm's pay-over-time product at more than 500 JD Sports and Finish Line stores, as well as online.

The partnership comes on the heels of a 50% year-over-year increase of purchases at sporting goods stores in October, according to Affirm.

"We're excited to partner with Affirm, especially with Black Friday and Cyber Monday just around the corner," said Henry Spear, JD Sports' SVP of digital operations, in a statement. "These events are the Super Bowl of the holiday shopping season, and we know our customers will appreciate the added flexibility and transparency that Affirm offers as they shop," he said.

Affirm has a network of more than 320,000 merchants, including Amazon, American Airlines, Peloton and SeatGeek, among others. —Joey Pizzolato

Elizabeth Crain, Consello partner.

Elizabeth Crain, Moelis COO who led IPO, joins Consello

Elizabeth A. Crain, a founding partner of investment bank Moelis, has joined Consello, also a New York City-based advisory firm, as a partner and executive committee member. As chief operating officer of Moelis from 2007 to 2023, she oversaw its expansion and led the firm's initial public offering in 2014. Previously, she worked at UBS, where she was the COO of the Swiss bank's Americas investment-banking unit. She was named one of American Banker's Most Powerful Women in Finance in 2011 and 2012. "Elizabeth has been a pivotal player in driving growth at some of the most successful franchises in financial services. We are delighted to welcome her to Consello as we grow our business around the world," Consello's founder and CEO, Declan Kelly, said. —Chana R. Schoenberger

Klarna’s valuation boosted roundup slide.

Hollie Adams/Bloomberg

Klarna aims to hire 100 engineers in Poland next year

Swedish buy now/pay later is looking to tap into Poland's robust pool of tech talent in 2025 amid its launch of a new technology hub in Warsaw.

The fintech plans to hire 100 Poland-based engineers next year to focus on AI-specific innovations, the company said. Klarna has had a presence in the country since 2021.

"Poland is Europe's next tech powerhouse," said Sebastian Siemiatkowski, co-founder and CEO of Klarna, in a statement. "Warsaw's exceptional engineering talent, thriving startup scene, and strategic location make it the perfect choice for our new tech hub. This isn't just about Klarna's growth — it's about unlocking Poland's potential on the global stage."

The announcement comes on the heels of the fintech's confidential IPO filing, which is expected to test the strength of BNPL products as a whole. Klarna has already made a deep commitment to AI, and said 90% of its employees already use the budding technology for daily work. It also said in August that it brought in an average of 73% more revenue per employee over the past 12 months as a result of the tech. —Joey Pizzolato

Venezuela Monthly Inflation Doubles On Bolivar Drop - Holiday shopping

GABY ORAA/Bloomberg

Consumers to lean on credit cards, BNPL for holiday shopping

More than two-thirds of consumers plan to leverage debt this holiday season to purchase gifts, according to a Nov. 22 study from Debt.com.

The survey, which polled 1,000 American consumers, found that 26% of Americans planned to take on between $100 to $300 of holiday debt; 13% expected to take on $300 to $500 of debt; 17% said they would probably incur $500 to $700 worth of debt; 19% said they would take on $700 to $900 of debt; and 25% said they would take on at least $900 in debt.

"Americans are feeling squeezed this holiday season, and it's not just inflation," said Howard Dvorkin, chairman of Debt.com, in a release. "The combination of convenience tools like BNPL and the allure of AI-recommended gifts can make it dangerously easy to overspend. This creates a perfect storm for debt that consumers will still be paying off long after the holiday lights come down."

Nearly 90% of respondents said they planned to use credit cards for their holiday purchases, while 69% said they would use a combination of credit cards and buy now/pay later offerings for their holiday shopping. —Joey Pizzolato

Cole Burston/Bloomberg

Canadian credit card balances expected to increase in 2025

Canadians are expected to continue to lean on credit cards next year as inflation subsides and interest rates fall, according to TransUnion's Q3 2024 Credit Industry Insights report.

Average credit card balances in the third quarter grew by 6.97% year over year to $4,562, according to the credit rating agency. TransUnion expects credit card balances to keep rising in 2025 even as origination volumes of new cards are expected to be flat. Average prime consumer balances are expected to increase 3.9% to $3,320 in December 2025, and average below prime consumer balances are expected to increase 1.6% to $9,231.

Meanwhile, serious credit card delinquencies, which are defined as 90-plus-days past due, are expected to inch down by 2 basis points by the end of 2025 to 0.89%. —Joey Pizzolato

Luke MacGregor/Bloomberg

Revolut CEO lays out plans for 2025

London-based fintech Revolut has big plans for 2025, its chief executive said at an exclusive event for its customers last week.

Chief Executive Nikolay Storonsky said the fintech is planning the gradual rollout of an artificial intelligence-powered assistant for its application, FinExtra reported. Revolut also plans to launch its first mortgage product in Lithuania, with Ireland and France to follow later in the year. It plans to differentiate itself from mortgages provided by more traditional financial institutions by speeding up the approval process.

The company is also planning on launching branded ATMs with facial recognition technology in Spain "early in the year," according to FinExtra. Those ATMs will initially dispense cash and Revolut cards, and eventually have cash-deposit functionality.

A Revolut-branded kiosk is also on the docket for 2025, which will allow restaurants and stores to manage their operations and eventually accept biometric payments. —Joey Pizzolato

Jason Alden/Bloomberg

HSBC enters BNPL market in the UK

HSBC is entering into the buy now/pay later market in the United Kingdom with the launch of a new installment payment option, called Flexipay.

The BNPL solution will initially be available with energy company Ovo, HSBC's first merchant partner, with others to follow. Ovo provides home energy products, such as solar panels, electric vehicle charging and other green-tech upgrades to consumers.

Ovo customers will be able to spread out payments of their solar system for up to three years at 0% APR, according to Ovo. They can also extend payments up to eight years with interest. Systems cost, on average, 9,000 pounds ($11,298.02).

"Paying in installments is increasingly popular and can be a great budgeting tool, providing the certainty of fixed repayments and a set end date," said Andy Rankin, interim head of unsecured lending at HSBC UK, in a statement. "Moving into next year we will look to expand HSBC Flexipay further, providing those buying a wide range of products the opportunity to benefit from its flexibility." —Joey Pizzolato

Chris Ratcliffe/Bloomberg

Cryptocurrency ownership gets a boost in the UK

Interest in cryptocurrency in the United Kingdom is on the rise as the Financial Conduct Authority mulls additional regulation for the decentralized currencies.

About 12% of adults in the U.K. — or around 7 million people — own cryptocurrency as of August 2024, up from 10% in 2022, according to the FCA. The average value landed at 1,842 pounds ($2312.33), an increase from 1,595 pounds in the same reporting period. More adults are also aware of cryptocurrency, too — 93% had heard of crypto, up from 91% in 2022.

The research comes as the FCA considers new regulations governing crypto. The regulator has been cracking down on illegal crypto ATMs in the last few months, and secured its first guilty verdict in October. —Joey Pizzolato