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Forbes
5 hours ago
- Business
- Forbes
Fold Debit Card Review 2025
The Gemini Credit Card® is a traditional credit card that offers a nice welcome bonus and ongoing ways to earn bitcoin rewards, with impressive rewards rates on categories popular in most people's budgets. Fold charges a fee if you want to earn the highest rewards rates, but there's no annual fee or additional fees to get Gemini's best rates. You can check your eligibility for the Gemini card with no impact on your credit. But if you continue with the application after confirming eligibility, it will require a hard pull on your credit. Note that eligibility does not guarantee final approval. Fold Debit Card * vs. Venmo Credit Card * The Venmo Credit Card * offers custom cash back for your top two eligible spending categories each month. Earn 3% on your top eligible category and 2% on your next category. The list of categories eligible for the best rates is fairly comprehensive. It includes travel, transportation, dining, nightlife, groceries, entertainment, bills and utilities, health and beauty and gas. While the Venmo Credit Card * technically earns cash back, it offers a 'Cashback to Crypto' feature that automatically purchases the cryptocurrency of your choice with cash back you earn on the card. Cryptocurrencies available through Venmo include bitcoin, ethereum, litecoin, bitcoin cash, solana and chainlink. Fold Debit Card * vs. Visa Card * Similar to the Fold card, the Visa Card * is a prepaid card, which means no hard inquiry to your credit. There is a 1% fee to top up your balance, even with a debit card. Topping up with a credit card carries a 2.99% fee, and PayPal has a 2.1% fee. There's no annual fee, but the card does have tiered staking requirements to earn more rewards with a higher lockup. It also has varied ATM, transfer and purchase limits with each card tier. Higher tiers include benefits like airport lounge access, and each level offers varying degrees of Spotify and Netflix subscription rebates.
Globe and Mail
a day ago
- Business
- Globe and Mail
Bread Financial (BFH) Q2 2025 Earnings Transcript
DATE Thursday, July 24, 2025, at 8:30 a.m. EDT CALL PARTICIPANTS President and Chief Executive Officer — Ralph Andretta Senior Executive Vice President and Chief Financial Officer — Perry Beberman Need a quote from one of our analysts? Email pr@ TAKEAWAYS Adjusted Net Income: $149 million for the second quarter of 2025, with adjusted earnings per diluted share of $3.15, excluding the $10 million post-tax impact of debt repurchase expenses. Return on Average Tangible Common Equity: Return on Average Tangible Common Equity was 22.7% in the second quarter of 2025. Credit Sales: $6.8 billion, up 4% year over year for Q2 2025, with more than 50% of credit sales driven by expanded co-brand and proprietary products. Average Loans: $17.7 billion, reflecting a 1% decrease, attributed to softer consumer spending and elevated gross credit loss impacts. Revenue: $929 million in revenue, a 1% decline year over year in Q2 2025, primarily due to lower finance charges and late fees, partially offset by lower interest expense. Net Loss Rate: 7.9%, down 70 basis points year over year in Q2 2025 and 30 basis points sequentially, including a 30 basis point headwind from hurricane actions taken in Q4 2024. Delinquency Rate: 5.7%, down 30 basis points year over year, and 20 basis points sequentially. Reserve Rate: 11.9% reserve rate at Q2 2025 quarter-end, improving by 30 basis points sequentially and year over year. Direct-to-Consumer Deposits: $8.1 billion at Q2 2025 quarter-end, a 12% increase year over year compared to the same quarter last year, accounting for 45% of average total funding, while wholesale deposits declined from 34% to 29% compared to the same quarter last year. Total Net Interest Income: Decreased 1% year over year in Q2 2025, affected by lower billed late fees and changes in risk/product mix, partially offset by lower interest expense. Expenses: Total non-interest expenses rose $12 million, or 3% year-over-year in Q2 2025, due primarily to the $13 million debt extinguishment cost; Adjusted non-interest expense remained essentially flat year over year. Capital and Liquidity: Common equity tier 1 (CET1) ratio at 13.0% for Q2 2025, up 100 basis points sequentially, and total risk-based capital at 16.5% for Q2 2025. Balance Sheet Optimization: Completed a $150 million share repurchase in April 2025 and a $150 million tender offer for 9.75% senior notes during Q2 2025; announced an additional tender offer for the third quarter of 2025. Guidance Revisions: Upgraded full-year 2025 net loss rate outlook to 7.8%-7.9% from 8.0%-8.2% based on first-half credit outperformance. Partner Programs: Multi-year extension signed with Caesars Entertainment; top ten programs secured into at least 2028. Product Launches: Introduced Caesars Rewards Prestige Visa Signature and co-brand credit card providing up to 5% crypto rewards, both designed to enhance customer engagement and loyalty. Loan Yield and Net Interest Margin: Loan yields reached 26.0% for Q2 2025 and net interest margin was 17.7% for Q2 2025, both down sequentially and year over year due to seasonal and mix trends. SUMMARY Bread Financial (NYSE:BFH) reported adjusted net income in Q2 2025, reflecting an improving credit outlook and continued deposit growth, while revenue and average loans slightly declined amid persistent macroeconomic headwinds. Management emphasized prudent risk management, operational discipline, and dynamic product innovation, including partnerships and new card offerings. The company executed significant capital return and debt reduction initiatives in Q2 2025, resulting in improved liquidity and capital ratios for greater balance sheet flexibility. Perry Beberman stated, "we anticipate higher marketing and employee-related costs in the second half of 2025 versus the first half following typical seasonality." The company's total liquid assets and undrawn credit facilities stood at $7.7 billion, representing 35% of total assets at the end of Q2 2025, supporting ongoing liquidity management priorities. Ralph Andretta said, "With this renewal, our top ten programs are secured into at least 2028." signaling stability in key partner relationships. Direct-to-consumer funding comprised the majority of deposit funding at the end of Q2 2025, shifting the mix away from wholesale sources and indicating a strategic funding transition. Perry Beberman confirmed, "we are projecting lower billed late fees for the remainder of the year, modestly pressuring our full-year revenue outlook." Improved credit reserve quality and a higher proportion of prime customers were cited as drivers of stable or improving loss absorption capacity in Q2 2025. INDUSTRY GLOSSARY CECL: Current Expected Credit Losses; an accounting standard requiring anticipated lifetime credit loss recognition for financial instruments. Co-brand Credit Card: A credit card issued in partnership between a card issuer and a brand, offering special rewards or benefits tied to the partner's products or services. Private Label Credit Card: A credit card branded for a specific retailer, usable only within that retailer's ecosystem and not on general credit networks. BNPL: Buy Now, Pay Later; point-of-sale financing that allows consumers to pay in installments. PPNR: Pre-Provision Net Revenue; a measure of revenue less non-interest expenses but before provisioning for credit losses. Gross Credit Loss: Total loan charge-offs before accounting for recoveries. CET1 Ratio: Common Equity Tier 1 capital divided by risk-weighted assets, used as a regulatory capital adequacy measure for banks. Full Conference Call Transcript Ralph Andretta: Thank you, Brian, and good morning to everyone joining the call. Today, Bread Financial reported strong second quarter 2025 results. We delivered adjusted net income of $149 million and adjusted earnings per diluted share of $3.15, which excludes the $10 million post-tax impact from expenses related to the debt we repurchased in the quarter. Return on average tangible common equity was 22.7% for the quarter. Our results reflect notable progress in advancing operational excellence while at the same time achieving responsible growth and practicing disciplined capital allocation. Enabled us to deliver strong returns. Credit sales grew 4% year over year for the second quarter. Spending continues to be more heavily weighted towards non-discretionary purchases enabled by our expanded co-brand and proprietary products. These product offerings represent more than 50% of our credit sales. Additionally, lower gas prices have positively influenced retail spending, particularly for prime and near-prime customers. We are encouraged by these spending trends as well as a gradual improvement in our credit metrics as a result of prudent risk management. Perry Beberman: Given the outperformance of our net loss rate in the first half of the year, we updated our full-year outlook to an improved range of 7.8% to 7.9%. While the net loss rate remains elevated compared to historic levels, the improving trend is encouraging. We will continue to closely monitor consumer health, purchasing, and payment patterns and adjust our credit strategies accordingly to achieve industry-leading risk-adjusted returns. Our focus on expense discipline and operational excellence is producing the desired result. As adjusted total non-interest expense were essentially flat year over year despite continued technology-related investments, inflation, and wage pressures. We will continue to invest in technology modernization, digital advancement, artificial intelligence solutions, and product innovation that will drive future growth and efficiencies. We continue to make progress on our ongoing initiatives to optimize our balance sheet with the completion of a $150 million share repurchase program in April and a successful $150 million tender offer for our senior notes in the second quarter. These actions and the strong capital and cash flow generation of our business offer enhanced opportunities to deliver additional value to our shareholders. Additionally, our direct-to-consumer deposits continue to grow steadily, increasing to $8.1 billion at quarter-end, up 12% year over year. We are pleased to announce the multi-year extension of our long-term relationship with Caesars Entertainment, a leading travel and entertainment partner. With this renewal, our top ten programs are secured into at least 2028. Furthermore, we recently launched an additional new fee-based Caesars Rewards Prestige Visa Signature credit card that gives members more ways to earn rewards and enjoy unique experiences. Also during the quarter, we launched the co-brand credit card program offering up to 5% in crypto rewards delivered through a frictionless user experience that is natively integrated into the app. This new program is another example of Bread Financial's leadership in loyalty innovation and flexible tech-forward payment solutions. Ralph Andretta: We are proud of the progress we have made in strengthening our balance sheet while providing increased value to our brand partners. Our strong results reflect the continued commitment and hard work of our dedicated associates. We remain confident in our ability to successfully execute our strategic objectives and operational excellence initiatives. In summary, we are well-positioned to deliver strong returns which we expect to translate into sustainable long-term value for our shareholders. I'll pass it over to Perry to review the financials in more detail. Perry Beberman: Thanks, Ralph. Slide three highlights our second quarter performance. During the quarter, credit sales of $6.8 billion increased 4% year over year driven by new partner growth and higher general-purpose spending. Average loans of $17.7 billion decreased 1% as compared with historical trends. Continued macroeconomic challenges drove softer consumer spending and the cumulative effect of elevated gross credit loss over the past twelve months adversely impacted loan growth. More recent improved payment behaviors as evidenced by higher payments also pressured loan growth. Revenue was $929 million in the quarter, down 1% year over year primarily due to lower finance charges and late fees partially offset by lower interest expense. As Ralph mentioned, in June, we completed a $150 million tender offer for our 9.75% senior notes due 2029 using excess cash on hand to reduce higher-cost debt. The repurchase increased our total non-interest expenses by $13 million, which is the primary driver of the $12 million or 3% year-over-year increase in total non-interest expenses in the quarter. On an adjusted basis, expenses were nearly flat year over year. Income from continuing operations increased $6 million primarily due to a lower provision for credit losses and lower income taxes. Looking at the financials in more detail on slide four. Total net interest income for the quarter decreased 1% year over year resulting from a combination of a decrease in billed late fees resulting from lower delinquencies and a gradual shift in risk and product mix. Leading to a smaller proportion of private label accounts, which generally have higher interest rates and more frequent late fee assessments. These headwinds were partially offset by lower interest expense, the gradual build of pricing changes, and an improvement in reversal of interest and fees related to improving gross credit losses. Non-interest income was up $3 million primarily as a result of the recent paper statement pricing changes partially offset by lower net interchange revenue driven by higher profit share. Looking at the total non-interest expense variances, which can be seen on slide eleven in the appendix, employee compensation and benefits decreased $2 million despite merit increases and other inflationary pressure as a result of our increased focus on operational excellence. Card and processing expenses increased $4 million primarily due to higher network fees driven by our gradual shift in product mix and information processing and communication expenses increased $4 million driven by elevated software license renewal pricing. Other expenses increased $8 million primarily due to the $13 million of debt extinguishment cost. Looking ahead, we anticipate higher marketing and employee-related costs in the second half of 2025 versus the first half following typical seasonality. Adjusted pre-tax pre-provision earnings or adjusted PPNR, which excludes gains on portfolio sales and impacts from repurchase debt, decreased $7 million or 1% primarily due to lower net interest income. Turning to slide five. Both loan yields of 26.0% and net interest margin of 17.7% were lower sequentially following seasonal trends. Net interest margin, which decreased 30 basis points year over year, was impacted by the net interest income drivers I noted earlier as well as an elevated cash mix position in the quarter. On the funding side, we are seeing funding costs decrease as savings account and new term CD rates decline. Additionally, our cost of funds should continue to improve as we opportunistically repurchase $150 million of our highest cost 9.75% senior notes during the quarter. We are pleased with our ongoing direct-to-consumer deposit growth represented in the chart on the bottom right of the slide, which increased to $8.1 billion at quarter-end. Further improving our funding mix. Direct-to-consumer deposits accounted for 45% of our average total funding, up from 40% a year ago. Conversely, wholesale deposits decreased from 34% to 29% year over year. Moving to slide six. We continue to optimize our funding capital and liquidity levels as a key strategic initiative. Our liquidity position remains strong. Total liquid assets and undrawn credit facilities were $7.7 billion at the end of the second quarter of 2025, representing 35% of total assets. At quarter-end, deposits made up 74% of our total funding with the majority resulting from direct-to-consumer deposits. Given the success of our oversubscribed second quarter senior notes tender offer, we announced an additional tender offer this morning, which is expected to be completed in the third quarter. Shifting to capital. We ended the quarter with CET1 and Tier 1 ratios at 13.0% and total risk-based capital at 16.5%. Over the past twelve months, in addition to the more than 200 basis point positive impact on our total risk-based capital ratio from our subordinated debt issuance in March, our capital ratios were impacted by the repurchase of $194 million in common shares as well as the repurchase of 99% of our original $316 million convertible notes outstanding. As a reminder, the last CECL phase-in adjustment occurred in the first quarter of 2025 resulting in a 74 basis point reduction to our ratios. The impact from the last CECL phase-in adjustment along with the repurchase convertible and senior notes accounted for more than 180 basis points of adjustment to CET1 since the second quarter of 2024. Our CET1 ratio increased 100 basis points sequentially from the first quarter. Looking ahead, we expect to build capital further in the third quarter placing us within our medium-term CET1 ratio target of 13% to 14%. As a result, we are well-positioned to strategically focus our capital and sustainable cash flow generation on supporting responsible profitable growth and generating additional value for our shareholders. Finally, our total loss absorption capacity comprising total company tangible common equity plus credit reserves ended the quarter at 25.7% of total loans, a 40 basis point increase compared to last quarter. Demonstrating a strong margin of safety should more adverse economic conditions arise. We have a proven track record of accreting capital and generating strong cash flow through challenging economic environments. We're well-positioned from a capital liquidity and reserve perspective. Providing stability and flexibility to successfully navigate an ever-changing economic environment while delivering value to our shareholders. Moving to credit on slide seven. Our delinquency rate for the second quarter was 5.7%, down 30 basis points from last year and 20 basis points sequentially. Our net loss rate was 7.9%, down 70 basis points from last year and down 30 basis points sequentially. Despite the approximately $13 million or 30 basis point negative impact from the customer-friendly hurricane actions taken in the fourth quarter of 2024. There will be no further impact to our credit metrics as a result of those actions. Credit metrics continue to benefit from our multi-year credit tightening actions, product mix shift, and general stability in the macroeconomic environment. We anticipate the July net loss rate will be in line to slightly better than the reported June net loss rate of 7.8%. With the third quarter in the 7.4% to 7.5% range and then increasing sequentially in the fourth quarter following typical seasonality. The second quarter reserve rate of 11.9% at quarter-end, a 30 basis point improvement year over year and sequentially, was a result of our improving credit metrics and higher quality new vintages. We continue to maintain prudent weightings on the economic scenarios in our credit reserve modeling given the wide range of potential macroeconomic outcomes. We expect the reserve rate to remain relatively steady in the third quarter before dropping at year-end following normal seasonality. On the bottom right chart, our percentage of cardholders with a 660 plus prime score improved by 100 basis points sequentially to 58% in line with our expectations. Our credit risk strategy remains unchanged, managing risk while delivering industry-leading risk-adjusted returns. Our segmented underwriting models incorporate recent performance data, baseline macroeconomic variables, and various stress scenarios ensuring appropriate returns for us and value for our partners. At this time, we remain balanced in our consumer outlook and related credit actions given uncertainty regarding the potential downstream impacts on consumer spending and employment from recent monetary and fiscal policies, particularly tariff and trade policies. Turning to slide eight, and our full-year 2025 financial outlook, we continue to expect average loans to be flat to slightly down. Our outlook for total revenue excluding gains on portfolio sales is anticipated to be flat versus 2024 as a result of our implemented pricing changes offset by interest rate reductions by the Federal Reserve, flat to lower average loan balances, and continued shift in risk and product mix. Given improving delinquency trends and payment behaviors, we are projecting lower billed late fees for the remainder of the year, modestly pressuring our full-year revenue outlook. We continue to expect to generate nominal full-year positive operating leverage in 2025 excluding portfolio sales and the pre-tax impact from our repurchase debt, which includes both convertible and senior note repurchases. We are confident in our ability to deliver on our operational excellence initiatives by investing in the business while maintaining expense discipline. Given the better-than-expected improvements in credit metrics in the first half of the year, we adjusted our 2025 net loss rate guidance to a range of 7.8% to 7.9% from the previous range of 8.0% to 8.2%. Current consumer resiliency despite concerns in how the macroeconomic environment may evolve in the future provided us with confidence in our revised net loss rate guidance for this year. Finally, our full-year normalized effective tax rate is expected to be in the range of 25% to 26% with quarter-over-quarter variability due to the timing of certain discrete items. In closing, our second quarter results and capital actions underscore our confidence in our ability to achieve solid financial results in 2025 and deliver strong long-term returns. Operator, we are now ready to open up the lines for questions. Operator: Thank you. At this time, we will conduct the question and answer session. As a reminder, to ask a question, you will need to press star one on your telephone and wait for your name to be announced. To withdraw your question, please press star one again. Please standby while we compile the Q and A roster. Our first question comes from the line of Mihir Bhatia from Bank of America. The floor is yours. Mihir Bhatia: Hi. Thank you for taking my question. I wanted to start maybe with just the health of the customer, particularly with an eye on, you know, credit sales and loan growth, I guess. It sounds like you said they are pressed health of the consumer is pretty stable and you're seeing, you know, you saw 4% growth in credit sales. But maybe just talk a little bit about the monthly trends that you're seeing. Was that steady throughout the quarter? Any update on July? And then how does that 4% credit sales growth translate down to loan growth? Ralph Andretta: Yeah. So, Mihir, I'll start and, you know, to your point out, I'd like to start just, you know, framing a little bit on the economy because I think that's the key driver of credit sales and what we're thinking for the rest of the year. You know, and to your point, I think, you know, the consumers overall have remained, you know, I think we think they're in a pretty stable spot and pretty resilient, which is really encouraging. With that said, you know, the overall economic environment is a little mixed in terms of what's coming in from the economic data. Right? I mean, some of the hard data is showing that resilience where on the other hand, sentiment and confidence indicator has been more volatile. So we think there's gonna still be there's still a lot of uncertainty out there of what the impacts of trade, immigration, tax policy may end up for the tax policy to resolve. But so when we look at it, you know, we're still feeling very encouraged with the hard data, with the unemployment steady, you know, that 4.1%. So we don't think there's gonna be pressure on jobs. Wages have been growing at above 3%, which is outpacing inflation at seven out of nine of the last nine quarters. And for us and our consumers who we serve, that's really important. That's the thing we said in order for things to turn for us. We needed that to occur. So when we look at it, we think about the back part of the year and the I'll say the better improvement or continued improvement in sales that we've seen that's gonna be important. And that's why when we think about we look ahead, the things that are happening with trade policy are so important because if this turns out to be inflationary, that's gonna probably slow down the progress that we've seen with our consumers where they've been increasing spend, payments have been improving, and it would just slow the improvement. I don't think it would, you know, reverse it. But that's what we're watching real carefully. You know, these trade deals just know, we don't know the outcomes and we're seeing some things every day. I think some of them, if they're the good outcomes would be you get more jobs, to come and investment into the US, that could be a good thing. The other hand, if countries disinvest in us and it goes the other way, that could be bad. So there's a lot of moving parts but our expectation is continued gradual improvement with the consumer I think that's gonna happen. And it's gonna take you over a prolonged period of time. Now to your question, on what we're seeing so far in July, it's been a real positive trend. So there's momentum building from what we saw in this last quarter, and it's continuing on so far into July. So we're optimistic. Can't really tell if it's a pull forward of purchases because of what could be consumers' concern about pending inflation. But that's a positive as well as we're seeing some good strength in our co-brand and higher quality customers. You know, so right now, I'd say we're in a very optimistic point but being very watchful of what's gonna unfold with the macro environment. Mihir Bhatia: Good. Just to be clear, sorry, on July, are you seeing an acceleration from the 4%? I mean, you said I just wanna make clear on exactly what you said there. Ralph Andretta: Yeah. We still continue to see a positive trend. Mihir Bhatia: Okay. Maybe just turning then to capital plans and buybacks. Look. You have a healthy ROE. It doesn't sound like you're anticipating much loan growth. At least for the next couple of quarters. CET in a good place. I understand you're doing stuff on the debt side, but maybe just talk a little bit about buybacks, how you're thinking about those any thoughts to go get an authorization and do stuff there? Ralph Andretta: Yeah. It's an excellent question. I'm not surprised we're getting that question. You know, as you know, we set those targets for our capital ratios, particularly CET1, which are currently our binding constraint. We stated that the medium-term target for that was in the 13% to 14% range. And as noted, when we hit 13.0%, we just hit the bottom end of that range. I would expect in the third quarter to continue to accrete capital and so we will continue to execute against our capital plan. We'll have discussions with our board around what's appropriate, looking at our pipeline as well as, you know, we do stress scenarios and, again, we'll follow the discipline. And we'll determine what's appropriate. But first and foremost, we'll continue with our capital priorities that remain unchanged, which is the fund. Responsible profitable growth that meets the return hurdles. I'll generate more capital in the future. We're gonna continue to invest in our business. And again, a lot of that's being funded through our operational excellence efforts to contain expenses and reinvest that. And then, you know, we're obviously due to hit the capital targets that we've stated and then, return capital when appropriate. And again, we'll continue against that capital plan, but we'll optimize the balance sheet and capital stack into next year. We might start to introduce preferred at some point next year, but still more opportunity and but we are very excited to be in the position that we're in right now. Mihir Bhatia: Thank you for taking my question. Ralph Andretta: Thank you for your question. Operator: Our next question comes from the line of Sanjay Sakhrani from KBW. The floor is yours. Sanjay Sakhrani: Thank you. Good morning. Perry, maybe you could talk a little bit more about that slightly tempered top-line view. I know you've got some crosswinds here with better credit, and that affects late fees. But you also have some of the mitigation impacts that would be rolling through over time. Could you just help us think about the progression of the top line, specifically NII, over the next, you know, whatever, six to twelve months? Perry Beberman: Yeah. And thanks for the question. You're right. So what's occurred that drove us to tighten up our guide on revenue was really the improvement that we're seeing in delinquency and having lowered billed late fees. That happening faster than what we had expected is what's putting pressure on the top line NII. And to your point, there are other tailwinds in there, but, you know, we go down the list of things that I talked about in the past. Right? We've got headwinds in there. From prime rate reductions that are still pulling through this year. There could be more if the Fed actually starts to act sooner on some of the following primary reductions. Because, again, we're slightly asset sensitive. The lower billed late fees coming through that we're now seeing, that's get related to delinquency. I'll take that all day for now. It just means we're gonna move towards a more normalized environment. The shift in a product mix that we have, we have a little bit more co-brand, and proprietary card. They have lower risk, which means you have a lower signed APR at the time of underwriting them, and I also come with lower late fees. Right now, we're running with a little bit higher cash mix, and that's honestly a result of a little bit lower loan growth. So we're taking that cash and trying to, you know, action it in a prudent way, which is why we announced another tender this morning. So those are the headwinds and the tailwinds are some of the, you know, the pricing changes that we put in place. And they continue to slowly build. But, you know, those will reach a certain point because, you know, obviously, the late fee will change. It didn't go in effect, so we don't have to go as aggressive on some of those things. And then another tailwind as the gross losses improve, there'll be less reversal of interest and fees. And so the fact that we're having lower billed fees now, I mean, you know, a few quarters out, say six months from now, that will have less reversals related to those accounts. You know, so then as you think about what's happening with each quarter, there's gonna be a lot of variability in terms of the seasonality, the timing of these things, and that's where it makes it really hard to give, you know, direction. I'll say, quarterly because it is fluid, and I think that's evidence by what we just saw with late fees, the billed late fees this recent quarter. Sanjay Sakhrani: Okay. Maybe this is a question for both you and Ralph. Obviously, credits now, I think, going the right direction. You guys seem to have some control over it. The macro, you know, tariffs withstanding seems to be stable. It's not improving some, you know, now that those factors, which have been headwinds, are not the headwinds, how do you guys play offense from here? You know, you talked a little bit about the excess capital position you have. Maybe a little bit if you could talk about the growth prospects, etcetera, you know, how do we build, how do we lean in and grow from here? Ralph Andretta: Thanks. Hey, Sanjay. It's Ralph. How are you doing? You know, I think a couple of things. You know, when you talk about capital, our priorities haven't changed. We're going to continue to invest in the business, strengthen the balance sheet, and return value to shareholders. And, you know, now we have the ability to do all three. So it's a nice balance. That's a nice position to be in. You know, in terms of growth, you know, I am pleased with the progress we've made on credit. We're not there yet entirely. We need to make more progress, and we'll continue to do that. Continue to manage it. I'm pleased with the sales growth in the second quarter and what July's looking like. That's a real positive green shoots for us as we move forward. If you take a step back and think about our ten largest partners. They are secured to the end of the decade. So we have our ten largest partners where we could continue to, you know, drive value for them and for our customers there. That's our focus, to invest in that. We have an extremely robust pipeline, and, you know, we win more than our fair share. There's a lot of de novo opportunities in that pipeline that we can grow opportunities and move forward. So, you know, if you look at all of that, you know, I remain optimistic about our closed opportunities as we move forward. Sanjay Sakhrani: Thank you. Operator: Thank you for your question. Our next question comes from the line of Moshe Orenbuch from TD Cowen. The floor is yours. Moshe Orenbuch: Great. Thanks very much. Perry, maybe you could just put a little finer point on kind of the mix shift that you've been seeing with respect to kind of higher-end consumers and more general-purpose spend. Has that had an impact on balance growth in addition to yield? Like, what should we think about in terms of that? And are those consumers revolving on their balances? Perry Beberman: Yeah. Wait, wait. Thanks for the question. So when we talk about mix shift, it's slow and gradual. I mean, you can see it in our vantage risk scores. When we talk about, you know, co-brand mix, I think people think about that super prime customer, those airline programs, hotels. You know, our co-brands are different. We underwrite those deeper than others. We certainly follow our mantra of underwriting for profitability. We look for programs that have good revolve behaviors and that's so we think about retail partner co-brands. They perform like high-end private label in a way. And then you have other ones that are top-of-wallet co-brands, you know, like a AAA, you know, Caesars that maybe performed somewhere in between what you'd think of those traditional big co-brands. So it's not a tectonic shift in the portfolio. It's a slow gradual shift. And one that is giving us a little different type of behavior over time. And it will, as we said, it can influence loan yield somewhat, but not to the point where it's gonna be dramatically different because we do make sure that we're being disciplined in the value propositions that we have, that works with partner, works for us, and that will, yeah, it's delivering the right type of capital return. But we do get more sales from that and the sales, you know, to your point, they do have a little higher payment rate in there. But often they do turn to revolve and they lead to loans. Moshe Orenbuch: Gotcha. Thanks. Maybe, you know, you talked a little bit about the effects of the late fee mitigants and the pricing. Could you maybe flesh that out a little more? Like, where do you see yourselves in that and how is that gonna impact the margins, you know, kind of over the coming quarters and any discussions with retail partners about either pulling them back or reinvesting them elsewhere? Thoughts like that. Thanks. Perry Beberman: Yeah. It's honestly, it's exactly what you kind of just said. Right? I mean, we are, you know, working with all the partners as we normally do. That's what we call business as usual type activity. We have a very engaged commercial team, a client partnership team that is meeting with them almost daily and trying to make sure that, you know, our shared interests are aligned and that we're trying to grow the program. Create the best value propositions we can for those customers. And then for us to be able to underwrite as deep as we do. And, you know, some of the pricing that's in place is what was important in order for us to continue support the program the way we do. Now I'd expect, you know, much of the industry pricing to remain in place as everybody's dealing with the ever-changing macro environment and regulatory changes. And for us, it comes down to continual underwrite, provide access to credit while ensuring the competitive value. You know, I think you're gonna see continued accretion into the yield over the next year or so, but it's gonna be slow and gradual. And as this other things happening, that will offset some of that. We talked about this earlier, as delinquency improves materially, that, you know, will have pressure on the yield on that front. So it may not be as evident as it was a steady state and just pure, you know, revenue accretion. Moshe Orenbuch: Got it. Thanks very much. Operator: Thank you for your question. Our next question comes from Terry Ma of Barclays. The floor is yours. Terry Ma: Hey, thank you. Good morning. Can you maybe just expand a little bit more in terms of what you need to see before you kind of unwind some of those tightening actions? Is it kind of more on the performance side or just more kind of macro driven? Perry Beberman: Yeah. Yeah. I think I heard your question right. You're asking what would it take for us to consider unwinding more? Terry Ma: Yep. Perry Beberman: Yeah. To credit. So it's very dynamic, and, you know, I don't wanna have an impression out there that we haven't been, you know, giving customers line increases who are worthy. We have. It's just as you think about a posture when it's been a tighter posture because of the environment and being cautious about what is ahead. So our team has been really disciplined in managing our credit strategies. We balance the goal of achieving our long-term loss rates and achieving our profitability goals. So, you know, we continue to make targeted strategy adjustments on segments in our new account and existing account where we have some areas we've loosened a little bit, meaning we've put more lines out there or new accounts. We realize, hey, there's better performing pockets, so we're gonna give them higher line assignments when they're coming in the door. Others, you tighten up. So we've been dynamic. We've actually started to reintroduce some of that, but it's going to be very gradual. And if you think about it, I think there's an idea out there in the industry that when you think about loosening, it means you're gonna approve a lot more accounts. Well, I can tell you on the margins, we're approving accounts that have a much higher loss rate than the average that we have today. So that's margin, which most means you have customers your pockets are 2% loss rates. You're gonna have those are much higher. Higher. So to go deeper means you're gonna go really out there. And, you know, for us, the reason one of the reasons why you can see a slow, steady, gradual improvement in our loss rate is because the new account vintages that we put on are trying to get something that's close to the target that we stated, you know, our long-term target around 6%. If we really wanted to drive our loss rate lower, we could put on even smaller new account vintages and target a 4%, and some others do something like that. So we're being very disciplined in how we approach this, but I expect that, you know, our team will continue to offer credit, line increases, approvals as appropriate, and it'll help continue to aid growth. The biggest thing is seeing better consumers come in the top of the funnel, with improved credit, and as they perform better, it's gonna naturally, you know, correspondent credit actions will follow. Terry Ma: Got it. That's helpful. And then maybe just to follow-up on credit. You called out last quarter improving roll rates. I think you mentioned it was kind of broad-based across FICO cohorts. Has that continued? And then can you maybe just quantify how elevated those roll rates are relative to kind of what you expect to be kind of normalized? Thank you. Perry Beberman: Yeah. Our roll rates have been improving, and that's the thing that we talked about. It's one of the most important aspects for us to get comfortable in, you know, improving our loss guide. I mean, we're benefiting two things right now. Our roll rates have improved, so the mid to late stage roll rates is still elevated above pre-pandemic but improving. But another encouraging part though is that our entry rate into collections is now well below pre-pandemic levels due to the strategic actions that we have and the changing mix of the portfolio. So we still wanna see improving back-end roll mid to back-end roll rates, and I think there's still room for that to happen. But a lot of that's gonna be macro dependent. So I'd say we're encouraged there. And again, some of what it's hard to, you know, put a fine point on what's happening, but there's been a little bit of a shift in how customers are using their tax refunds. So that's also as we look at roll rates throughout the months and quarters, that has shifted. You know, I'll give you a factoid on that. I mean, when you think about pre-pandemic levels, people talk about using 20% of their tax refund on everyday purchases, which means there's some more other refunds to pay down their debt. So times like this, these months, you'd get more debt pay down, and that would improve your roll rates. Well, now more consumers, 35% to 37% is what I read recently, are using their tax refunds for everyday purchases. It's almost 2x. Which means there's less being used to put against their existing debt, which means you're getting a little different payment dynamic as, you know, in these months that you typically would have seen it. So I think that's somewhat what's also gonna affect some of the seasonality and month-to-month movement people are going back to compare to prior years. Terry Ma: Would you like to add anything additionally? Operator: Okay. Thank you for your question. Our next question comes from Reginald Smith from JPMorgan. The floor is yours. Reginald Smith: Hey. Good morning. Thanks for taking the question. It's funny we're all kinda asking about growth and my question is related as well. I was curious in what you guys can share in terms of the trends you're seeing and just the volume of gross applications that come through for specifically for both the co-brand and the private label, if you could kinda segment that out, that would be great. I know one of you guys mentioned your approval rate. And I'm not asking for an exact number, but can you kinda contextualize where you are today and maybe what that approval rate would have looked like in a more bullish environment. So I'm just trying to figure out, like, what the Slack potential is in there. And then finally, as you think about new accounts that come on, what can you tell us in terms of, like, engagement? Are they using a card versus maybe previous cohorts? Any type of metric or color you could give there would be great. And I have one follow-up. Thank you. Ralph Andretta: Yeah. It was a lot of questions in that question. So, yeah, you know, obviously, it depends by partner. Right? So if you look at it by partner by partner, we're seeing, you know, application flows at the top of the funnel, and we're gonna see those still see in-store applications, we still see online applications. As we move forward. You know, it's a strong flow, and I think our approval rate is appropriate given the economic and macro conditions, and we continue to see that. You know, once we do approve a card, we're very focused on engagement. And in ensuring that the customer and the partner understand the opportunities that they get to spend on that card. You know, we just we have a partnership with That's our latest partnership. It is, you know, one where their customers could apply for the card in a native app. It's state of the art. It really works well. And once they apply for that app, there's really it's an opportunity for them to use the card appropriately, and to redeem for currencies that they like. And we are actually getting a halo effect with that because, you know, it is kind of state-of-the-art technology, and we're able to meet the needs of their customers and meet the needs of the partners. So we feel really good about all of that. But again, it depends, you know, we see a good application flow. We see our approval rates based on we're on the economy well. Once we do issue a card, we're very focused on engagement. And in ensuring that the customer and the partner understand the opportunities that they get to spend on that card. Reginald Smith: Got it. So I appreciate the hand of those. It sounds like there's nothing, like, you know, nothing hard you can tell us about those trends, which I guess is fine. I guess, my next question, you mentioned your top ten partners earlier, I think, in response to Sanjay's question. And is there a way to, you know, kind of frame your wallet here today with those partners and maybe know, what's your longer-term stretch goal could be there? Like, just to give us a sense of your penetration there and what you guys are driving to or how you would think about that longer term. Thank you. Ralph Andretta: Yeah. So I mentioned our top ten partners, and that was just to be clear, that's based on, you know, loans and receivables. So that's how I review our top ten partners. And, you know, they're secured and I say till the end of the decade, but at least to 2028, obviously, varies going back and forth. You know, the opportunity there is to focus on deepening our relationship with their customers. You know, instead of negotiating new deals and stuff like that, that's behind us. Now we're focused on how do we execute well on the partnership, drive new incentives, new technologies to make it easier for the partner to interact with the customer to interact with the partner and interact with us. So that's the beauty of having these big relationships locked up to the end of the decade. You focus on growing the business, not renewing the business. Reginald Smith: Okay. Thanks for the color. I appreciate it. Operator: Thank you for your question. Our next question comes from Jeffrey Adelson from Morgan Stanley. The floor is yours. Jeffrey Adelson: Hey, good morning, Ralph and Perry. Thanks for taking my questions. Wanted to just circle back on credit a bit. I know you'd called out the hurricane impacts for the quarter about 30 basis points, I believe. And I think previously, you'd mentioned that June would be seeing the bulk of the impact. So if I kinda think about stripping that out, it seems like your charge-off trend for June was actually down quite a bit, maybe 100 basis points nearly year over year. So I guess why shouldn't that trend continue as we think about the back half of the year? It seems like maybe you're guiding to a little bit more of a moderate decline. Is that just conservatism on the macro or maybe what are you seeing that would change versus the third quarter or the second quarter here? Thanks. Perry Beberman: Thanks for the question. You know, as we did make sure we called out that we do anticipate the July net loss rate to be in line to slightly better than the reported June net loss rate of 7.8%, and that's then we gave the guidance for the third quarter and that's 7.4% to 7.5%. And then the fourth quarter is generally seasonally, sequentially higher. So, you know, I think that's the point we're trying to say. And, you know, we did share. I mean, we're still cautious with what's happening with the consumer. Those back-end roll rates, while there's been some near-term improvement that we've seen recently, that could reverse. So I think, you know, we're giving a view which is, hey, if things hold steady, this is how we think the second half of the year could materialize. There's certainly, I think, as we talked about in the economic outlook, things that could go against us a little bit, but there's definitely positive momentum and things that could go to the favorable side. So, you know, again, we are encouraged by the trends, and for right now where we are at, this is our view for the second half of the year. And I don't know if I wanna say it's cautious, but it's some of our best thinking, but probably more the cautious side than it is aggressive, if that makes sense. Jeffrey Adelson: Yeah. That makes sense. Thanks, Brian. And if I could ask your question, you know, Ralph, you mentioned partners focused on growth, not renewing technologies, customer engagement. I'm curious, has BNPL come up more in the conversations lately? I know one of your peers has been introducing more of their Pivator product. You've obviously had that acquisition several years ago. Is that coming up more or are there any sort of, you know, key features and focal points your partners are looking at? And then as a follow-up to that, I know you just highlighted the crypto when you had last quarter. Any other areas of focus you're having in new prospective client conversations by any vertical? Thanks. Ralph Andretta: Yeah. You know, the beauty of Bread is that BNPL is a product in a product set. Right? So we absolutely can accommodate BNPL. We can accommodate installment loans. We can accommodate co-brand. A private label, direct-to-consumer deposits, direct-to-consumer credit cards. We have a basket of products and BNPL is one of them. So we can lean forward on whatever is popular in the marketplace. We can move forward with our partners and fulfill the need of the customer and the partner. So we feel really good about that. You know, if you think about our pipeline, it is robust. And as I said earlier, we win more than our fair share. We win more than our fair share because we have the right technology, we have the right offers, and we have the right team. That's a nice combination to have. And a lot of the things we're winning are de novo, so they get to grow with us, we get to grow as we move forward, and we've had great examples of that in the past, particularly with, you know, down in one of the verticals that we grew in beauty. We've grown beauty from a de novo to a really industry-leading vertical for us. There are verticals out there that we're yet to conquer, and we're excited about those. They're in the pipeline. You'll probably hear about them soon. As time and contracts will allow. But we're excited about our pipeline in the future and what that will do for our growth. Jeffrey Adelson: Okay. Great. Thank you, guys. Operator: Thank you for your question. Our next question comes from Bill Carcache from Wolfe Research Securities. The floor is yours. Bill Carcache: Thanks. Good morning, Ralph and Perry. Following up on the Caesars renewal and, you know, I guess any perspective that could offer on future renewals. Can you give some color on whether it was a competitive process? How did the pricing actions that you've taken impact the renewal discussions? You know, are there any changes to your risk-adjusted returns that you anticipate under the new terms? Ralph Andretta: Yeah. You know, the market is competitive. There's always has been competitive. The beauty of what we do in our team is we're very proactive with our partners. So to the extent that we can, you know, integrate interact with our partners early and, you know, and sign a renewal that avoids us going to RFP. That's always a good process to take. And, you know, we tend to lean forward on there into that number of cases. If something does go to RFP, certainly feel that as the incumbent, we have a really good shot to get it. We don't become irrational. We focus on what's important, which is growing the business. And ensuring that there, you know, that we can meet the requirements of the partners. So as I said, you know, our renewal rate is exceptional. And that renewal rate stands from being proactive with the partner and re-signing early to, you know, meeting, you know, looking at an RFP and deciding how we will move forward together. So either way, you know, there is always some compression in the marketplace. It's just that's competition does. But, you know, as long as they meet our hurdle rates, we're very focused on continuing to invest in those partners and moving their business and our business forward for the benefit of our mutual customer. Bill Carcache: Thanks, Ralph. And then separately, can you discuss what you're seeing when it comes to penetration of retail partner sales? Any trends you're seeing across different categories that stand out and sort of any notable efforts to drive that higher, particularly, you know, to the extent that we see you guys maybe expand your credit box if, you know, macro conditions sort of support that? How does that look in terms of that penetration? Ralph Andretta: You know, what I would say there is that if you think about where we were and where we are, you know, we have multiple different verticals now. We've had verticals in beauty. We have verticals in sports, travel, and entertainment. We're able and we have products that support all of those, whether it's a private label product, a co-brand product, a BNPL. Academy Sports, I'll give you as an example. They have private label, they have co-brand and BNPL, a full suite of products. That's in the sports area. So we're pretty much consistent across our top ten partners and what we offer and how we offer it. Data and analytics play a big part for us. You know, we're able to, you know, use data and analytics with our partners to identify opportunities to increase penetration. We continue to do that across all channels, whether that's in-store, whether that's digital or any other channel that might be out there. So the most important thing is we're giving products that our customers want with the right value proposition and make it easy for them to apply and be acquired. And that partner becomes a lifetime partner for us because we have products that meet their needs. No matter where they are in the spending in the credit cycle. Bill Carcache: That's helpful. Thank you. Operator: Thank you for your question. Our next question comes from the line of Ryan Shelly with Bank of America Securities. The floor is yours. Ryan Shelly: Hey, guys. Thanks for the question. I appreciate it. Mine is around the capital structure in today's tender. So you'd now offer out there for both the unsecured and the sub notes. The sub notes are relatively new issuance. I guess, could you give any color for the reasoning on going after the sub notes and just general thoughts around the capital structure as we move forward here would be much appreciated. I know you mentioned potentially doing some preferreds before. So just, you know, how should that investor specifically be thinking about this capital structure going forward? Thank you. Perry Beberman: Yeah. Thanks for the question. Yeah. So right now, as I've we talked about, as I mentioned earlier, we're in an excess cash position well above a buffer that we want to maintain. So we were opportunistically, you know, looking at our debt structure. And to your point, the subordinated notes are a newer issue. When we initially issued that, we issued what we call, like, more of a benchmark size deal for our balance sheet optimization it was, you know, well above what it needed to be. But we have optionality on this particular tender. Right? If you think about the senior notes, the ones that are 9.75%, we have an option to call those in February at a, you know, defined price. So right now, we're in a live offering and we're going to, you know, be appropriate with how we end up balancing the outcome. Ryan Shelly: Got it. Thank you. Is it likely you mentioned the February call prices and likely wait till then, see exactly how this tender goes, or it's just up in the air? Perry Beberman: Yeah. Look. We have optionality. Right? I think that's the point of when you have a call option, there's optionality. There's no decision definitively. A lot's gonna happen between now and then. Ryan Shelly: Fair enough. Yeah. Operator: Thank you for your question. Our next question comes from Vincent Caintic from BTIG. The floor is yours. Vincent Caintic: Hey. Good morning. Thanks for taking my questions. Just some follow-ups. So actually, going back to credit, I just wanted to understand maybe a bit further what's baked into the loss expectations for the second half of the year. And also what's, you know, assumed in your credit reserve rate. You already provide a lot of helpful detail, you know, for the third quarter, and the fourth quarter, but I guess when I look at the second quarter, and if you strip out that 30 basis points of hurricane impact, you had a 60 basis points quarter over quarter improvement to, like, 7.6%. And I guess the second half of the year kind of assumes that 7.6 stays there, in that range. So I'm kind of just wondering, you know, what maybe what's baked into that because it does seem conservative and maybe putting it another way. If we had the same kind of environment as we have today or as we had in the second quarter, could your net charge-offs be better than what you're regarding to? Thank you. Perry Beberman: Thanks for the question. Look, when we're looking at things right now, what we're seeing is and we're trying to guide. I think we had a good handle on the third quarter and gave you our best thinking there. You know, we gave a range, so let's all hope it comes in on the lower end, but we'll see how things play out. And then, again, seasonally, things go you typically increase in the fourth quarter. We're trying to give you our best thinking. I mean, look, if we continue to see momentum in back-end mid to back-end roll rates, okay, could come a little better. Stay stable. We've kinda given you our view. So and some of it's gonna be dependent on what type of seasonal loan growth we have in the fourth quarter. And then on top of that, as I stated earlier, we've seen a little bit softer tax refund season. So that's changing some of the seasonal views, and what our thoughts are on the third quarter at this point. So that's influence. I guess. And so that's a key point on the loss side. You know, as it relates to your question on CECL, I'm surprised it's the first time I'm getting a question on CECL. So that's pretty good. You know, pleased with the progress there that we were able to lower the CECL rate by 30 basis points. Linked quarter and year over year. And what I'd share with you insight on that is that improvement in rate was solely due to credit quality. So in this environment, you know, I would have liked to have been in a position where we could start to ease back on some of our weightings on the adverse and severely adverse scenarios. But given the uncertainty that still is out there around tariffs and the downstream impacts to inflation, gotta wait, you know, another quarter or two to see how that, you know, pulls through. But really, if we can continue to see momentum, I expect that, you know, a stable reserve in the third quarter then seasonally come down in the fourth. And, you know, we'll see if credit continues to improve. Maybe it a little better than that, but don't know until that plays out, because you get you run the models at the end of a quarter based on where things are at. But, you know, certainly more encouraged right now, and I just hope we get a fast resolution on the macro pieces because, again, the consumer's performing well, the portfolio's performing well, and we just need, for macro to resolve itself. Vincent Caintic: Okay. Great. That's helpful. Thank you. And then follow-up kind of on the merchant discussions we had earlier. I mean, if you could talk about, you know, from the merchant engagement perspective, the environment, the pipeline, and also how are the economics of new business you're putting on doing versus, you know, prior business? Thank you. Ralph Andretta: Yeah. You know, I'll go back to what I said previously. The pipeline is robust. We have a lot of terrific opportunity. We always win more than our fair share. We look at it on a by-partner basis, and the economics have to be right for us and the partner, we remain very disciplined in our economics and our returns and our pricing, and we'll continue to do that. Vincent Caintic: Okay. Great. Thank you. Operator: Thank you for your question. That concludes the question and answer session. I will now pass it back to Ralph Andretta for closing remarks. Ralph Andretta: Thank you, and thank you all for joining our call today and your continued interest in Bread Financial. We look forward to speaking to you again next quarter. And everyone have a terrific day. Thank you all. Operator: Thank you for your participation in today's conference. This does conclude the program. You may now disconnect. Where to invest $1,000 right now When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor's total average return is 1,037%* — a market-crushing outperformance compared to 182% for the S&P 500. They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor. *Stock Advisor returns as of July 21, 2025 This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. Parts of this article were created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability.
Yahoo
6 days ago
- Business
- Yahoo
This $34 Billion Crypto Bet by Dubai's Flagship Airline Could Signal the End of Traditional Travel Payments
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Dubai's flagship carrier Emirates has just formalized what could be the biggest crypto-payment partnership in aviation history, according to Arabian Post. The airline inked a strategic alliance with setting the stage for travelers to book flights using digital currencies by next year. But this isn't just about paying for your vacation in Bitcoin—it's a calculated bet on the future of money itself. The Deal That Could Change How We Fly Emirates and signed a memorandum of understanding that goes far beyond simple payment integration. The partnership will embed Pay directly into Emirates' booking systems, creating what industry experts are calling a 'seamless crypto-to-travel pipeline.' The deal was ceremonially signed under the watch of Sheikh Ahmed bin Saeed Al Maktoum, Emirates' chair and CEO, signaling the highest level of institutional backing according to Arabian Post. Don't Miss: — no wallets, just price speculation and free paper trading to practice different strategies. Grow your IRA or 401(k) with Crypto – . The timing isn't coincidental. Emirates has been chasing younger, tech-savvy travelers who increasingly view traditional payment methods as outdated. Deputy President Adnan Kazim emphasized the airline's commitment to 'meeting evolving customer preferences,' a corporate euphemism for acknowledging that millennials and Gen Z travelers are driving crypto adoption in consumer spending. The Dubai Crypto Surge That's Reshaping Finance This partnership sits at the center of a broader financial revolution in the UAE. Between July 2023 and June 2024, Dubai attracted approximately $34 billion in crypto investments—a figure that would make some small countries jealous. The emirate has systematically built regulatory frameworks that encourage blockchain innovation while maintaining what officials call 'robust investor protection.' Unlike the wild-west crypto environments elsewhere, Dubai's approach has been methodical. The city's regulators have created clear guidelines that allow major corporations like Emirates to embrace digital currencies without regulatory uncertainty. This isn't crypto for crypto's sake—it's strategic positioning for a post-cash economy. Trending: New to crypto? on Coinbase. What This Means for Your Wallet For travelers, the practical implications are immediate. Starting next year, passengers will be able to book Emirates flights using major cryptocurrencies through Pay. The integration promises to eliminate traditional banking fees, cross-border transaction delays, and currency conversion headaches that plague international travel. But there's a deeper play here. Eric Anziani, COO, described the partnership as a 'catalyst for wider cryptocurrency adoption in consumer finance.' Translation: if you can buy a $2,000 flight to Dubai with Bitcoin, why not your morning coffee? The Risk-Reward Calculation Emirates isn't diving into crypto blindly. The airline has emphasized that the integration will meet 'the highest security and compliance standards,' addressing the elephant in the room—crypto's reputation for volatility and security breaches, according to Arabian Post. This measured approach mirrors Emirates' earlier partnership with American Express Middle East, showing a pattern of strategic financial innovation rather than reckless experimentation. The partnership also includes joint marketing initiatives designed to educate customers about crypto payments. This educational component is crucial—while crypto adoption is growing, actual usage in consumer transactions remains limited by knowledge gaps and security Bigger Picture for Investors For financial markets, this partnership represents a significant milestone in institutional crypto adoption. When a major international carrier—one that transported over 51 million passengers in 2023—embraces crypto payments, it signals mainstream acceptance that goes beyond speculative trading. The move also positions Dubai as a serious competitor to traditional financial hubs. While New York and London debate crypto regulation, Dubai is actively integrating digital currencies into its economic infrastructure. For investors watching regional trends, this partnership suggests the Gulf states are positioning themselves for the next phase of global finance. Emirates' calculated entry into crypto payments isn't just about convenience—it's about positioning for a future where digital currencies become as commonplace as credit cards. Whether you're paying in Bitcoin or booking with a boarding pass, the message is clear: the future of travel payments is already taking off. Read Next: Accredited investors can —with up to 120% bonus shares—before this Uber-style disruption hits the public markets Image: Shutterstock This article This $34 Billion Crypto Bet by Dubai's Flagship Airline Could Signal the End of Traditional Travel Payments originally appeared on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15-07-2025
- Business
- Yahoo
Trump Media Files for Third Crypto ETF
Cronos, XRP and Solana have entered the chat. Trump Media filed last week with the Securities and Exchange Commission to launch a new fund, the Truth Social Crypto Blue Chip ETF, which would primarily hold Bitcoin but also Ether, Solana, Cronos and XRP. Its fees have not been disclosed, but the crypto exchange platform is slated to act as the fund's digital custodian. The move is the latest foray by President Trump's media company into the increasingly deregulated, and saturated, world of crypto products. READ ALSO: Vanguard Expands Fixed-Income Menu with 3 Treasury ETFs and Tariff Fallout Hasn't Hit Markets Yet. Issuers Say That Could Change The filing taps into increased demand for cryptocurrencies other than Bitcoin, said Bryan Armour, Morningstar's director of ETF and passive strategies research. 'As more cryptocurrencies are approved for spot ETFs generally, I think there will be more appetite and significant product development around an indexed version of multiple cryptocurrencies,' he said, 'so my guess is they'll appear in different ways.' The problem is that Solana, XRP and Cronos aren't yet available to trade as spot funds, which has slowed the launch of index-type crypto ETFs, Armour said. That leaves little room for Trump Media's other two ETFs to differentiate themselves from existing funds. It's only a matter of time until the SEC's approval of additional currencies opens the door for new players, however. 'It's a more level playing field because they'll be starting alongside other asset managers and there's potential to differentiate,' Armour said. '[Cronos] has a significant overweight, but that might appeal to some investors to get that type of mix.' Trump Media, which operates Trump's Truth Social platform, has now filed for three strategies with the SEC: The Truth Social Crypto Blue Chip ETF would have 70% of its assets allocated to Bitcoin, with 15%, 8%, 5% and 2% going to Ether, Solana, Cronos and XRP, respectively. The Truth Social Bitcoin and Ethereum ETF would have 75% of its assets allocated to Bitcoin and 25% to Ether. The Truth Social Bitcoin ETF would be a spot Bitcoin ETF, aiming to serve as a Bitcoin reserve for the US government. The Blue Chip version will allocate about 5% of its holdings to Cronos — a currency developed by an affiliate of the fund's custodian, Foris DAX Trust Company. That's of particular note, Armour said, because the product should have a 1% allocation based on market cap. Name Brand? The main force behind Trump Media's crypto ETFs at present is the Trump name itself, which may not be enough, said Roxanna Islam, head of sector and industry research at VettaFi. 'They do appeal more to Trump fans or people that are anti-mainstream financial issuers. But that can only go so far,' she said, adding that fees will also play a role. 'Will they even remotely catch up? It's hard to say, because they're over a year behind.' This post first appeared on The Daily Upside. To receive exclusive news and analysis of the rapidly evolving ETF landscape, built for advisors and capital allocators, subscribe to our free ETF Upside newsletter.
Business Recorder
15-07-2025
- Business
- Business Recorder
How Dubai intends to become the ‘capital of crypto'
Dubai isn't just experimenting with crypto anymore — its latest announcements show it's going all in. One of the most recent examples is the Dubai Land Department (DLD) signing a memorandum of cooperation with a platform called to develop a digital investment environment for virtual real estate assets and explore the use of blockchain technologies and digital currencies within the property sector. Earlier in the year, Dubai Finance (DOF) said it is working with to enable the payment of government service fees using cryptocurrencies. Emirates, Dubai Duty Free set to allow crypto payments In the announcement, DOF explained that the move supports the implementation of the Dubai Cashless Strategy by enabling 'secure, efficient and inclusive financial transactions through cryptocurrencies.' and 'empowering the government to introduce a new digital payment channel across its official platforms.' Outside of government departments, Emirates Airline and Dubai Duty Free are also gearing up to allow crypto payments for flights and duty free merchandise, and have also partnered with So what factors are driving the embrace? Khalil Kassam, chief business officer and co-founder at crypto data provider Kaiko, told Business Recorder: 'Dubai's government is strategically accelerating its embrace of cryptocurrency, viewing it as a pivotal element for economic diversification and achieving its ambitious goal of a 90% cashless economy by 2026.' According to him, Dubai's non-oil economy already contributes 75.5% of Dubai's GDP. 'This proactive stance, aligned with the broader Dubai Economic Agenda (D33), aims to solidify Dubai's position as a global digital asset hub and attract cutting-edge tech innovators.' 'A cornerstone of this strategy is the Virtual Assets Regulatory Authority (VARA), the world's first standalone crypto regulator, which has cultivated a robust and clear regulatory framework over several years, ensuring investor protection and enforcing strict AML/KYC standards, fostering trust and attracting legitimate businesses and capital.' 'This includes offering tax-free solutions for crypto activities for individuals and opening up new levels of expat investment.' For users, the embrace means enhanced convenience and accessibility. For example, Emirates Airline and Dubai Duty Free integrating crypto payments for flights and retail, will cater to 'tech-savvy customers and reduce cross-border payment hassles,' he said. As for the property sector, Kassam explained that tokenization opens up investment to other countries, allowing, for example, someone in Tokyo to buy an apartment as an investment without needing to be physically in Dubai. 'The future of Dubai's property sector is being fundamentally reshaped. Tokenization dramatically boosts market liquidity, allowing properties to be traded more like equities, enabling investors to exit their investments quicker than traditional methods. This also streamlines transactions, reduces costs by cutting out intermediaries, and enhances transparency and security through blockchain's immutable records.' He said 'this strategic pivot positions Dubai as a leader in PropTech innovation, attracting global tech innovators and solidifying its status as a future-ready real estate hub.' Meanwhile Business Recorder also spoke to the CEO of online broker Traze - Erkin Kamran - who said that the DLD move will 'streamline transactions, reduce costs by minimizing intermediaries, and enhance transparency and security through blockchain's immutable records.' He said adopting blockchain use in the property sector also helps with fractional ownership - something the DLD has already begun - 'allowing investors to buy portions of high-value properties, democratizing access and attracting a wider global investor base.' He also echoed Kassam's sentiments regarding VARA, 'which ensures market integrity, investor protection, and compliance with anti-money laundering standards, fostering a secure and trustworthy digital asset ecosystem.' 'This holistic approach solidifies Dubai's position as a leading, regulated, and innovative global digital asset hub.' While Dubai hasn't explained why it's chosen to partner with Singapore-based what we do know is that Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, First Deputy Ruler of Dubai, Deputy Prime Minister, and Minister of Finance, met the President and Chief Operating Officer of in April. They discussed opportunities for collaboration in areas related to the digital economy, including emerging technologies, virtual assets, and financial innovation. is one of the few global exchanges fully licensed by VARA. It holds both provisional and operational licenses for retail and institutional services. It can be argued that this regulatory approval makes an ideal partner for public-sector integration. It also offers crypto-to-AED conversion, secure wallets, and easy integration with government systems like DubaiPay. It has a regional HQ in Dubai, invests in local initiatives and has worked with regulators in other countries, including Singapore, the UK and the US. To sum up, Dubai's efforts are not just visible in the setting up of VARA but also in its clear licensing frameworks for exchanges, custodians, and other crypto service providers. It has crypto free zones like DMCC (Dubai Multi Commodities Centre) which are crypto-friendly and offer licensing; the government and the royal family have supported events, accelerators, and investment in blockchain startups; and there is no income tax on crypto gains (personal use), and no corporate tax in many zones. While places like Singapore and the EU offer mature and cautious regulatory environments, and the US has no clear federal regulatory framework, Dubai stands out for its speed, clarity, and ambition in becoming a global crypto hub. Copyright Business Recorder, 2025
