I’m glad I made the decision to attend my very first Merchant Risk Council event this week. For those that don’t know, MRC Vegas is the second largest payment event in the US (after M2020) but with a VERY different focus. MRC is attended by the “hands on” payment leaders from all the top merchants and the vendors that serve them: Stripe, Adyen, PayPal, V, MA, risk, fraud, …. Etc. Whereas M2020 is attended by FinTech, Crypto, Venture, Institutional investor, and strategy audiences, MRC is much more focused on making payments work.
Tag Archives: payments
Identity, Authentication and Risk
Bridging Domains – Short Blog – Random Thoughts
This is a “Random Thoughts” blog, which means there are many points that I’ve left hanging (not finished cleanly). The blog’s objective is to stimulate discussion, so please don’t hesitate to comment. Identity is a hot topic for me with 15+ years of previous bosts. Here are a few updates … as well as my evolving perspective.Continue reading
Real Time Payments in US – Strategic Shifts
Short Blog. I’ll expand on this next month.
As I’ve written about since September, and seen in yesterday’s press (WSJ), top US issuers are have created a new consortium with a first phase product centered on a white labeled SRC wallet. For investors, 100% of payment types in this wallet will be existing cards (no new retail payment network). Their partners are the key eCom gateways (Stripe, Square, Shopify, …etc).
Part 3 – Internet 2.5 – The Next “Wave” is Here
Happy After Thanksgiving! Hope everyone was able to enjoy a wonderful time with family and friends. Today is the 3rd installment of the series, a long blog.
The next big network wave is here. Call it web 2.5 or 3.0, but the integration of payments into “everything” is a major event. Payments are the “trust layer” that TRANSFORM anonymous nodes providing uncertain service into known, defined and guaranteed service providers. Effective communities require value exchange and “trust”. The payment trust function enables networks to evolve from “cost free” discovery and information sharing, into transactional resource/service exchange: from read-write to read-write-execute. Sure we could call the wave “trust” but the only ubiquitous “trust network” is payments so I prefer to keep payment wave as the naming convention.
Random Thoughts – Modularity and Trust
Trust in a transaction. In another one of my favorite books (Design Rules: modularity) there exists the concept of trust between physical components of an integrated system. This book stands in contrast to Nobel Economists’ work in defining the “Firm” and organizational boundaries in Transaction Cost Economics (TCE). But the technical theory of modularity is amazingly consistent with the concepts of “boundaries” in TCE. In modularity, there are 4 core rules for separating technical components:Continue reading
Part 2 – The Power of Bank Networks
The Bull Case for V/MA (24 pages).
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Part 1 – US Payments Environment covered the complexity of the US payment environment and the challenges faced by top banks in modernizing their systems (where all systems live forever). There are many types of payments: bill payments, A2A, P2P, wires.. Today the focus is on how banks intermediate commerce. Banks MUST have networks as every bank can’t connect to every consumer/merchant. Effective Bank networks (aka rails) are NOT a commodity service, but one that allows the banks to leverage their unique ability to assume risk.
Part 1 – US Payments Environment
Assessing the Environment and Setting the Focus (part 2 – Power of Bank Networks)
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Must read FT article “How JPMC’s plan to kill credit cards split the bank”. The article discusses Jamie Dimon’s internal mandate to drive a new payment network. I was shocked with the level of internal org quotes here. In my view, Jamie is the best bank CEOs in history (based on performance and talent coming out of JPMC). As a former banker, I know how hard it is to move the ship. However, FT is wrong. Chase’s efforts ARE NOT about killing credit cards, but rather creating something much bigger.
This is a long blog..Continue reading
Trust Assertions – Identity Will Define the Future of Payment Networks
©Thomas Noyes, May 2022
My blogs last week have me thinking about the changes going around in Identity. This will be a long blog. Typo warning.. I’m still revising.
The number one thing I look for in payments is change: volume, technology, behavior, data, …etc. Effective networks are notoriously hard to change, but they are also very resilient (see blog). Small changes in data flows, can lead to significant changes in margin and “control”. Margin and control guide both public and private investment (see Evolution of Visa and Mastercard Beyond Payments).
Identity is our most important asset — it’s literally who we are.
Our complete “identity” is known to no one, as each entity we interact with has a partial view of us based upon what we chose to give them and what they observe. How others accept and validate our identity, and how others share insight about us, is the core of payments (see Trust Networks and Authentication in Value Nets). The structure, exchange, and assertions associated with identity are defining: web3, DeFi, Crypto, CBDCs and the Metaverse. These are not separate silos, but rather overlapping ecosystems that must interact, thus the importance of bridging identity across networks/domains (see Blog – Trust is domain specific).
Apple – Project Breakout
Last week Bloomberg reported on Project Breakout: Apple’s effort to bring financial services in house. So what is it? Here is my 60% confidence bet.
DeFi, CBDCs and Web 3.0
My perspective has been evolving as I work to build out infrastructure for “when Crypto grows up” in my new Company. I’m pleased to report that Accept Payments (acc3pt.com) went live this month and is expanding our private rollout as we fine tune all of the CX. Thought for the day… Its about trust..