The introduction of the case study
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The online era has revolutionized the financial sector (e-money, e-banks, e-services and so forth). Expectations refer to a huge depending on some certain electronic channels in delivering financial services, and in particular banking services. For example, Bill Gates expects that more than two billion customers will subscribe mobile banking applications by 2030 (Sampaio et al., 2017). Hence, it might not surprise you to know that banking sector will most likely be inhabited by the outsiders i.e., “banking is essential to a modern economy, banks are not” (Akturan and Tezcan, 2012, p. 444).
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Recently, Mobile-only-banks have started to introduced banking services. A good example is Lunarway. "Lunar A/S has been granted permission as a payment institution by the Danish Financial Supervisory Authority" and also it has a "banking license in 2019" (Lunarway.com) There is no need to visit a physical place to open an account, it is 100% digital. Currently, Lunarway works in Sweden, and it was indicated that almost 6000 new customers register in Lunarway "Vi växer med omkring 6.000 användare per månad i Sverige med vårt just nu begränsade erbjudande” (Lundell, 2019). Overall, the market is witnessing other types of financial innovations that can be easily accessed and managed by app technology (e.g. Swish).
When it comes to - future - payment solution, the global and national interest is on Libra. In a recent document, issued by Sveriges Riksbank, Segendorf et al. (2019) argued that "the use of an eventual Libra for domestic payments in Sweden will probably be limited in the medium term, but, on the other hand, will probably become established and commonly used in various segments of the cross-border flow of payments." Segendorf et al. (2019, P. 5). concluded that Libra will not be able to perform the three role of money i.e. means of payment, unit of account, and store of value. Instead, it was concluded that “the extent to which Libra will act as a unit of account, with companies and private persons setting prices in Libra, remains uncertain.”
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Recently many voices have argued that using digital currencies might produce some negative consequences. A good example, is seen the case of Kuwaiti investors who lose millions of USD dollars in Bitcoin . In January 2018, The Central Bank of Kuwait announced a plan to issue a digital currency. This plan was a reaction to the huge losses Kuwaiti investors suffered from the collapse of Bitcoin prices. “Kuwait’s Ministry of Finance does not recognize cryptocurrencies for purposes of official commercial transactions. Moreover, the central bank of Kuwait prohibits the banking sector and companies under its control from trading in cryptocurrencies” (The Library of Congress, 2019). However, Kuwaiti investors lost around $ 500 million in four months due to the collapse of Bitcoin prices (Arabian Business, 2018).
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