Looking back at now
When my daughter was a toddler, I would often wonder what everyday thing of my childhood would seem unimaginable to her. Maybe it would be that you had to actually go to the library to photocopy stuff instead of using the internet. Or would it be that there were only 4 TV channels and all of them went off at night?
Then it happened on a date night. My wife and I were going out and my daughter was old enough to stay home and take care of herself. We had a “land line” in our house for emergencies but it was never used. So try explaining a phone that only works off noises, tones, and your memory of pushed buttons to a child who had only ever used an iPhone. It’s unimaginable.
So what about how we do payments today as an industry will seem unimaginable in the future?
Here are my top 3:
Lockboxes are already a weird concept to most of my west coast millennial fintech friends especially when you site the still massive percentage (at least 30%) of business payments that are paper checks. But the real crazy part is that actually printing a bill, mailing it, and then scanning the check back again has yet to be adequately replaced. We have to get to a truly ubiquitous way for two companies to exchange the money and the data about the payment. Oh yeah, and let’s do it without telling each other our bank account info.
You may not know when an international payment will arrive and how much it will be when it gets there. Now, there have been a lot of advances in cross-border payments but there are still a lot of them that flow through slow correspondent banking hops and draconian FX rates. The result of this series of handoffs is that you don’t know when it will get there and how much will arrive!
That you had to go to a building and talk to a banker to buy payments. Maybe this already done or at least seems unimaginable to some as we hit the year mark on Covid? The broader point is really that payments will increasingly come with the tech that dictates what the payment is for. You are already seeing the merchant acquiring flow from software platforms. Banks are hugely important (i’m not a basher) but their customer acquisition models are changing so fast.
These will all change. And I love debating the right solutions. It is a great way to chart a course to innovation.
If you want to geek out on payments, I’d be happy to talk about them. It’s fun to think about the future and even more, fun to make happen.
