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The payments landscape: the little voice in my head


Some weeks after the EPCA Conference in Disneyland some thought keep coming back in my mind: payments business will never be the same … Let me summarize:

1. people’s behaviour is continuously changing giving way for new ways of transacting. Social networks, mobile phones, growing e-commerce, businesses and supply chains integrate

2. the banking industry does not seem to have their act together when it comes to pro-actively set the direction for the payments industry. SEPA for Europe is like homework from Brussels, we only do the minimum so we get a ‘check in the box’. The billions invested are sunk costs anyway, and besides … banks have bigger problems to worry about. Who does really care whether new services will reach customers?

3. new innovative companies starting, all driven out of a specific need, but mostly without a clear view on market size or business case. That’s part of entrepreneurism. These new players use the banking infrastructure (accounts, card networks) to their advantage. Example: Paypal would never have become so big if there hadn’t been a card network and banks. Now with a critical mass of their own, Paypal is an infrastructure on its own. And a very sophisticated one: real time clearing, currency conversion and settlement. Not to forget the superior user experience. E-invoicing, e-payments and e-identity are the new frontiers where similar scenario’s will happen.

I see a world coming up where banks become even more regulated, sucking out all innovative energy of management and remain the regulated capital pools. The ‘making money move’ between people, governments and businesses will increasingly become the domain of customer focused companies, because payments are more and more an information game, working independent of banks.

The voice in my head is growing stronger …



Comments: (1)

Barry Kislingbury
Barry Kislingbury - ACI Worldwide - London 18 May, 2010, 14:19Be the first to give this comment the thumbs up 0 likes

I would agree with the sentiment, banks are not keeping up with client requirements.  For instance if corporates had real time liquidity management, e-invoicing, matching and payments all through a flexible mobile interface, all the banks would be is an account and a processor, they would add little value.  So banks either have to get wise, go real time and add value to allow clients to do what they will do one way or another, or delay the process and not provide the real time infrastructures needed, hmm, makes me think of SEPA.  I believe we will see more delays to regulatory pressures, more alternatives from non-banks and in the not too distant future when banks realize they have to do something, mergers and acquisitions. 

Douwe Lycklama

Douwe Lycklama

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30 Nov 2005



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EBAday is the annual event for European payments professionals organised by Finextra and the Euro Banking Association. This community has been created to deliver a forum for EBA delegates to exchange views on instant payments, open banking and new developments in payments processing and technology.

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