Finance

About 37% of Americans have been charged a late fee on some kind of bill in the last 12 months, according to a new report by NerdWallet.
“Late fees are just one consequence of making late payments,” said Sara Rathner, a travel and credit cards expert at NerdWallet.

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Many consumers are finding it hard to keep up with their bills.
To that point, 37% of Americans have been charged a late fee on some kind of bill in the last 12 months, according to a new report by NerdWallet.

Credit card late fees were the most common, with 21% of survey respondents incurring at least one. Others had been charged late fees on utility bills, 10%, and rent, 8%. NerdWallet polled 2,061 U.S. adults in early April.
“Late fees are just one consequence of making late payments,” said Sara Rathner, a travel and credit cards expert at NerdWallet.
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While you can be assessed with a late fee as soon as you miss the payment deadline on a credit card or loan, it typically doesn’t show up as a black mark on your credit report until you are 30 days late, said Matt Schulz, chief credit analyst at LendingTree.
And if you’re late by 30 days or more, that’s when it starts to get more serious, experts say. Falling behind on payments can also come with more severe consequences, like having utility service shut off. Some consequences can be immediate, too, like car repossession.

“If you know that you’re going through a financial rough time, it’s definitely better to tackle it head on and not wait,” Schulz said.
Here’s how to limit the impact of late fees, and work with creditors if certain life events, like a layoff or financial hardship, are impacting your ability to pay.

‘Speak directly to you creditors’

If you are beginning to fall behind on usual monthly payments, or anticipate you might, it’s best to “speak directly to your creditors before you run into trouble,” said Greg McBride, chief financial analyst at Bankrate.com.
“That’s when you have the most options. The further behind you get, the fewer options exist,” he said.

Communicating your issue as early as possible can help. If your bill is due on the last day of the month, don’t wait to contact your servicer the day before, Schulz said.
If you contact them well in advance, you have more flexibility to explain your situation and negotiate a resolution, he said.
“Whenever you can go into one of these situations and offer up a solution … that can go a long way to making the conversation go a lot more smoothly,” Schulz said.

1. Ask to waive a late fee

Cardholders can ask their card company to waive a late fee the first time they miss a payment, Schulz wrote in his book, “Ask Questions, Save Money, Make More: How to Take Control of Your Financial Life.”
But keep in mind, “the more often that happens, the less likely,” the lender will offer a waiver, McBride said.
If you paid late once and there’s a high chance you will pay late again in the near future because of a financial issue, let the lender know, said Schulz.
“It’s one thing to go to the lender every other month and say, ‘Hey, I was late with this, can you waive that?’ It’s something else entirely to say, ‘Hey, I was late because I have this medical emergency or I lost my job,'” he said.

2. Enroll in hardship programs

If you realize that your payments are becoming harder to meet because of an unexpected life event such as a layoff, most lenders offer hardship programs. Those can help consumers by temporarily reducing interest rates and waiving fees, wrote Schulz in his book.
While the particular details can vary, “the key is to partake” of those opportunities, as they are “designed to help you get back on your feet,” McBride explained.
“If you run from the problem and just fall further and further behind, it just further limits your options,” he said.

3. Ask about cleaning up your credit report

Even one late payment can make a significant dent in your credit score; it could drop your score by up to 100 points, depending on other elements of your credit history.
If you made a one-time mistake, you can reach out to your lender and ask to have that late payment scrubbed from your credit report, experts say. While it’s possible under certain circumstances, lenders are generally not a fan of the tactic because it renders the data unreliable for future credit transactions. 
“Your credit report is just a collection of a bunch of data points representing how good you are paying debts back,” Schulz said. If lenders begin to “cherry pick” what goes on in the report, the data becomes unreliable, and it doesn’t help lenders make decisions. 

“The primary customers for credit reports are not consumers; it’s businesses,” said Schulz, as the reports are devised to help businesses make lending decisions.
Even though it is rare to occur, if you’re in an unusual situation and otherwise have a “spotless history,” you can go to the lender and explain what happened. For example: if you paid late because of a natural disaster, it doesn’t hurt to ask. 
“Weird life circumstances happen to everybody,” he said. More

Swedish climate fintech startup Doconomy told CNBC it’s raised 34 million euros ($36.9 million) in a Series B round co-led by the venture arms of UBS and CommerzBank.
Founded in Sweden in 2018, Doconomy works with more than 100 financial institutions around the world to help their clients measure the CO2 footprint of their transactions.
Doconomy plans to use the fresh cash to drive expansion into North America and roll out new products, CEO and co-founder Mathias Wikstrom told CNBC exclusively.

From left to right: Johan Pihl, Doconomy’s chief creative officer and co-founder, and Mathias Wikstrom, chief executive officer and co-founder.

Swedish climate-focused financial technology startup Doconomy told CNBC on Thursday that it’s raised 34 million euros ($36.9 million) from leading European banks, including UBS and Commerzbank.
Doconomy, which offers tools to help bank customers measure the carbon footprint of their everyday spending, raised the cash in a Series B financing round co-led by UBS Next and CommerzVentures, the venture arms of UBS and Commerzbank, respectively.

Credit ratings agency S&P Global came on board as a new investor, while existing shareholders Motive Ventures, PostFinance and Tenity also participated.
Founded in Sweden in 2018, Doconomy works with the likes of Boston Consulting Group, Mastercard, S&P Global, and the United Nations Framework Convention on Climate Change to calculate the climate cost associated with financial transactions.
Among the firm’s tools is the AIand Index, a cloud-based service for banks that helps their customers convert every transaction into its corresponding CO2 footprint. The index is used by more than 100 financial institutions in more than 40 countries.

Doconomy plans to use the fresh cash to drive expansion into North America and roll out new products, CEO and co-founder Mathias Wikstrom told CNBC in an interview.
“Going forward, we want to enable every bank in every corner of the world to engage their clients in the ESG [environmental, social, and governance] work of the bank,” Wikstrom said. “We see a connection between the E and S, the environmental and the social. We can’t isolate those two different streams.”

Wikstrom said he was “very happy” to see partnerships emerging with the likes of UBS and Commerzbank, describing it as an “alliance of the winning both money and intellect into getting this issue under control.

Politicization of climate

News of Doconomy’s latest funding follows the firm’s February 2023 deal to acquire Dreams Technology, a platform that uses behavioral science to boosts customers’ digital engagement and financial wellbeing.
Wikstrom said that Doconomy’s valuation in its Series B round is unchanged from the price at which it raised funds in its Series A, which saw the firm raise cash from the likes of Citi Ventures, Mastercard, and Ikea parent company Ingka.
Doconomy’s growth story hasn’t come without its challenges. More recently, the firm faced attacks from right-wing online commentator Jordan Peterson and his followers.

It’s not really hurricane season anymore, it’s fear season.

Mathias Wikstrom
CEO, Doconomy

Last week, Peterson targeted the company in a post on social media platform X, labelling it the “soft positive planet-saving voice of the worst imaginable corporate/fascist/green tyranny.”
The Canadian psychologist, who gained internet fame critiquing so-called political correctness, is a noted skeptic who described climate change as “the idiot socialist get-out-of-jail-free card.” He once framed rising greenhouse gas emissions as a positive for making the planet “green in the driest areas.”
Climate scientists say this is misleading, as it doesn’t take into account the negative effects intensified droughts, wildfires and heatwaves caused by global warming have on plants and ecosystems.
Wikstrom told CNBC that the situation concerning Peterson’s attacks on his firm “illustrates that we need to educate a lot of people.”
“Fear will lead to frustration and frustration will potentially lead to protests, and protests will lead to violence and violence will lead to damage done,” he told CNBC.
Wikstrom said that he hopes that the more the likes of Peterson and other climate skeptics keep “banging the drum,” the likelier that their sentiments will eventually sound “hollow.”
“Looking at what’s happening in Hawaii, in Canada, in France, in Spain, in Greece — we have the floods, we have the fires, we have so many concerns now,” he said. “It’s not really hurricane season anymore, it’s fear season.”
Climate fintech is a niche area of financial technology that has attracted heightened interest from investors, as world governments push corporates to hit ESG targets and reduce carbon emissions associated with their operations.
Michael Baldinger, chief sustainability officer of UBS, said the bank’s venture investment into Doconomy “underscores our focus on fostering innovation to provide the data and actionable insights our clients need to make informed choices about their investments and effect the change they want to see.”  More

Watch professionals play poker, and one of the first things to strike you is how often they fold when the game has barely begun. Rounds of Texas Hold’em, a popular variant, start with each player being dealt two cards and then deciding whether to bet on them. Amateurs are more likely to proceed than not, while pros fold immediately up to 85% of the time. Naturally this does not mean that high-stakes casinos are frequented by the timid. It is simply that most hands are too likely to lose to be worth betting on, and the pros are better at judging when this is the case.Investors usually dislike gambling comparisons. Yet at a recent conference held by Norges Bank Investment Management, which oversees Norway’s oil fund of $1.6trn, a packed hall sought to learn from a former poker pro. Annie Duke was there to talk about quitting decisions, a topic on which she wrote the book (“Quit: The Power of Knowing When to Walk Away”). Ms Duke argued that many factors stack the deck against people considering quitting, pushing push them to act irrationally. That applies to poker players wondering whether or not to fold—and also to investors considering whether to exit a position. More

Buying art can be a nerve-racking experience. But investors have long been able to console themselves with the thought that, if their purchase plummets in value, they will at least have something nice on their wall. Now they can also console themselves that they will have something to borrow against.That is because there has been a boom in “art-secured lending”. Until recently this was only available to the wealthiest clients of private banks. In the past five years, though, auction houses and boutique lenders have become more involved. Deloitte, a consultancy, reckons that such outfits increased their lending by 119% over the period, compared with a 31% rise at banks. Last year non-banks doled out as much as $8bn against art and collectibles, or 23% of all such loans, up from 15% in 2019. More

Zhou Qiren is an unusual economist. A professor at Peking University, he spent ten years toiling in the countryside during China’s cultural revolution. “The same farmer”, he observed, “worked like two totally different persons on his private plots versus on collective land.” Unlike most economists, Mr Zhou still studies incentives and constraints from the ground up, starting not with abstract principles, but with concrete cases, often drawn from his travels around China and beyond.After a visit to a rice-noodle bar in Qinzhen, he wondered why it offered one-week courses showing others how to replicate its prized dish. On trips to China’s sprawling new city districts, he notes that it takes 70 steps to cross the road compared with 15 or so for many streets in Manhattan. He is sceptical of state-owned enterprises, which he once compared to public passages crowded with private “sundries”. He also has doubts about the feasibility of national self-reliance. Prosperity, he has pointed out, is built on “coming and going” across borders. More

How to explain the disparity? India’s economy is growing astonishingly fast, Bangalore and Mumbai have become destinations for bosses of global financial firms and Narendra Modi trumpets the country’s appeal in his electoral campaign. Given the enthusiasm, surely foreign money is flooding into the country.Not quite. In April foreign investors dumped $1bn-worth of Indian shares. In May they dumped another $4.2bn. This is a sliver of the roughly $900bn of Indian shares in foreign hands, but it is a striking move given the mood music—and one that has pushed the share of the Indian stockmarket held by foreigners to just 18%, its lowest in a dozen years. More

When William Nordhaus, who would later win a Nobel prize in economics, modelled the interaction between the economy and the atmosphere he represented the “damage function”—an estimate of harm done by an extra unit of warming—as a wiggly line. So little was known about the costs of climate change that he called it “terra incognita”, unknown land, compared with the “terra infirma”, shaky ground, of the costs of preventing it. Eventually, a rough calculation gave him an estimate that 1-2% of global GDP would be lost from a 3°C rise in temperature. This was no more than an “informed hunch”, he wrote in 1991.A new working paper puts the damage far higher. Diego Känzig of Northwestern University and Adrien Bilal of Harvard University use past changes in temperatures caused by volcanic eruptions, as well as El Niño, a years-long increase in heat released by the Pacific Ocean, to model the impact of a warmer planet. Employing long-term data on global economic growth and average annual temperature, they find that an additional 1°C of warming will lead to a 12% fall in GDP. A climate-change scenario with more than 3°C of warming would be, according to their estimates, an equivalent blow to fighting a permanent war. More

In an exclusive interview with CNBC, Johan Tjarnberg, CEO of Trustly, said that his firm still needs time to prove the value of its open banking technology to investors before going public.
Trustly is holding out on an IPO even after reporting a strong set of financials, with results shared exclusively with CNBC showing the firm reported revenues of $265 million in 2023.
Trustly increased operating profit by 51% in full-year 2023, with adjusted EBITDA climbing to $51 million from $33 million in 2022.

Trustly CEO Johan Tjarnberg.

The boss of Swedish financial technology startup Trustly says an initial public offering for the company is still a year or two away from happening, even after a 51% jump in operating profit.
In an exclusive interview with CNBC, Johan Tjarnberg, CEO of Trustly, said that his firm still needs time to prove the value of its open banking technology to investors before going public.

“We need another year or two to really demonstrate to the market that open banking is happening happening, it’s here,” Tjarnberg told CNBC.
“For me, there is so much we want to demonstrate to the market in terms of user adoption, merchant adoption. We still need some time to execute on our existing playbook.”
Trustly is holding out on an IPO even after reporting a strong set of financials. Results shared exclusively with CNBC show the firm reported revenues of $265 million in its 2023 full year.
Growth accelerated significantly in the second half of the year, Trustly said, climbing 27% compared with the same period in 2022. That was as transaction volumes spiked 48% over the same period.
Tjarnberg told CNBC that the company’s performance in 2023 was heavily driven by the growth at its U.S. business. Trustly merged with American rival PayWithMyBank in 2020.

“We invested a lot into the U.S. market,” Tjarnberg said. “We were roughly 20 people there four years ago; we now have 500 supporting the U.S. market.”
Tjarnberg said that, in the first quarter of this year, Trustly saw heightened growth in areas like utilities, retail, and travel, with 22% of volumes coming from those core verticals, up 44% over 12 months.

Chipping away at Visa, Mastercard?

Trustly increased operating profit by 51% in full-year 2023, with adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) climbing to $51 million from $33 million in 2022.
That was as overall transaction value processed during 2023 climbed by 79%, to $58 billion.
Trustly helps companies integrate the ability to accept payments via open banking technology.
This tech lets consumers make payments directly to a merchant’s bank account without the need for an intermediary such as a card issuer.
It provides an alternative to incumbent credit card programs such as Mastercard and Visa, which charge merchants high fees for transactions.

In the U.S., Tjarnberg said, Trustly is seeing heightened demand from merchants “trying to take down costs,” as high card processing fees have made them more price-conscious.
“There is no secret that our objectives and ambition is to bring a good alternative to other payment methods, including cards,” he told CNBC.
Open banking is a trend which has gained significant momentum, particularly across Europe.
That’s thanks to the introduction of regulations which require banks to open their clients’ account data and payment functionalities to third-party firms.
It has paved the way for new entrants into finance including fintechs, startups and tech companies. Founded in 2008, Sweden’s Trustly competes with the likes of GoCardless, TrueLayer, Volt, Bud, and Yapily.

Future product plans

Trustly expects to launch a feature that allows its merchants to set up recurring payments for customers. That will be targeted at things like telecom packages and subscription-based music streaming services.
Tjarnberg said Trustly is “bullish” on the mobile space, particularly in the U.S. after having seen early success in mobile billing partnerships with the likes of AT&T and T-Mobile.
Trustly is used by more than 9,000 merchants worldwide including Facebook, Alibaba, PayPal, eBay, AT&T, Unicef, Dell, Lyft, DraftKings, Wise, and eToro.
Trustly is majority-owned by venture capital firm Nordic Capital, which owns a 51.1% stake in the business. Alfven & Didrikson is its second-biggest backer, with a 11.1% stake, while BlackRock holds an 8.9% stake.
Aberdeen Standard Investments and Neuberger Berman own 0.7% and 0.9% stakes in Trustly, respectively, while others including the Trustly management and employees own 27.4%. More