BRIAN KANTOR: Is Libra simply a bank by another name?
SA banks lose as much as R800m a year to credit and debit card fraud. They likely spend even more on trying to prevent fraud
Is new blockchain-backed payments system Libra, to be introduced by Facebook, a pure and much lower-cost payments system? Or a bank, or equivalently a money-market fund, upon which transactions can be drawn conveniently for low or no fees?
The operating costs for a bank that provides a payments facility are largely covered by the difference between the interest paid on deposits (perhaps zero) and the interest earned by the bank/payments provider making loans — of varying degrees of default risk. That is unlike a Visa that collects fees to cover its costs, and does not make loans.