Future of consumer payments: 4 lessons on cards, pay by bank, and AI

Consumer payments are entering a new phase. Cards remain dominant, but instant payments, pay by bank, digital wallets, stablecoins, and emerging AI-driven purchasing experiences are reshaping how consumers pay and how banks compete.

During the recent Finextra webinar sponsored by ACI Worldwide, The future of consumer payments: Cards, Pay by Bank, and the evolution of the multi-rail bank, industry experts from ACI Worldwide, J.P. Morgan and Red Hat debated a deceptively simple question: What happens to consumer payments now that cards have to share the stage with instant payments, pay by bank, wallets, stablecoins, and, increasingly, AI-driven payments?

The discussion opened with a nod to Mark Twain: Reports of the card’s death have been greatly exaggerated. What followed was a candid look at why cards continue to thrive, what it takes for banks to support growing payments choice, and how AI could reshape the future of commerce.

Four key themes emerged for banks looking to modernize payment operations while delivering the choice, convenience, and trust consumers increasingly expect. We’ve summarized these insights into a practical framework banks can use to assess their own consumer payments strategy.

The framework at a glance

If there was one area of consensus across the discussion, it was this: Cards are not disappearing, but they are no longer the only consumer payment option. Their longevity is rooted in global acceptance, convenience, and deeply embedded consumer habits. Equally important, card schemes and the fintechs built around them have continued to innovate rather than standing still.

Consumer behavior ultimately determines which payment methods succeed. Dean Wallace shared a personal example of using a pay by bank option with a major online retailer. While instant refunds directly into the bank account were a compelling benefit, the additional steps required to complete the payment eventually led him back to the convenience of one-click card payments. By contrast, younger consumers in his household viewed paying directly from a bank account as entirely natural. The lesson is clear: Payment preferences are generational, contextual, and market-specific.

“The emergence of new payment methods should not be viewed as a battle between cards and alternatives. Instead, banks should expect a growing range of payment options to coexist, with consumers choosing the method that best fits their circumstances, preferences, and expectations.”

Dean Wallace, Director, Consumer Payments Modernization, ACI Worldwide

An audience poll reinforced this view, with the overwhelming majority of respondents expecting cards and pay by bank to coexist, giving consumers greater choice at the point of sale.

Takeaways for banks:

• Treat multi-rail payments as a long-term strategic reality, not a transition from one dominant rail to another.
• Focus on interoperability and orchestration across payment rails, enabling consumers and merchants to move seamlessly between payment options.
• Expect payment choice to continue expand through wallets, request to pay, stablecoins, and AI-enabled payment experiences.
• Pay close attention to market dynamics. Regulation, incentives, interchange models, and central bank policies often influence adoption more strongly than product features alone.

Merchants and consumers, the panel agreed, don’t want more rails, they want better outcomes.

For consumers, that means choice, convenience, and a seamless experience, regardless of how a payment is processed behind the scenes. Whether they choose cards, pay by bank, digital wallets, or emerging payment methods, the experience should be simple, consistent, and reliable.

Merchants are focused on customer experience and business outcomes: higher conversion rates, lower fraud, fewer chargebacks, stronger authorization performance, and simpler reconciliation. They want to offer more payment options, but without the operational complexity that often comes with supporting them. Choice matters, but it cannot come at the expense of convenience, performance, or efficiency.

That creates a clear challenge for banks: offering choice while masking the underlying complexity from both the merchant and the shopper. Banks have technically been multi-rail for decades (RTGS, ACH, instant payments, cards, and multiple card brands), but those rails typically sit in separate fiefdoms. The panel was blunt that this is not only a systems problem: In many banks, cards and pay by bank are operated by entirely different organizations, and this structural separation constrains seamless routing as much as any legacy platform does.

The institutions furthest ahead were described as those that invested early in modernization and now run payments on a unified platform, able to select the most effective route for the customer and the transaction type without the customer ever being aware a decision was made.

Resilience is equally important. In an always-on commerce environment, availability directly impacts customer loyalty. If a preferred payment method is unavailable during checkout, consumers are unlikely to wait. They’ll simply choose another vendor.

Takeaway for banks

• Focus on outcomes, not payment rails
• Simplify payments for customers, merchants, and internal teams alike
• Address the operating model alongside the technology; siloed ownership of cards and account-to-account will reproduce itself in the customer experience
• Prioritize interoperability and intelligent orchestration across payment types
• Treat resilience and availability as essential components of the customer experience

One audience question cut to the heart of the pay-by-bank debate: Consumers expect the same level of protection they receive when paying with cards, and that protection is not always consistent across payment methods.

The panel framed agentic commerce as the next evolution of eCommerce in which the decision-maker, and potentially the payer, may be an agent deployed by the consumer rather than the consumer themselves. Today, this is already happening mostly through product recommendations and price alerts. Over time, it could evolve into agents that search, select, and also pay within consumer-defined parameters.

That second scenario is not yet deeply penetrating eCommerce. While the technology is advancing rapidly, the discussion highlighted that the biggest barrier is not technical capability. It’s trust.

“We can offer a lot of features, widgets, and capabilities, but adoption is the key. That has always been true in payments, and it will be just as important for AI-driven experiences.”

Ramon Villarreal, Global Payments Industry Lead, Global Financial Services, Red Hat

Recent ACI-commissioned research shows that around half of respondents would trust AI to find the best price, but only 18% trusted AI to act in their best financial interest, a stat that reflects today, not five years from now.

Another point brought into the discussion was a parallel with card behavior: We were once told never to let a card out of our sight, and now, we enter card details on websites without a second thought.

Several practical implications emerged for banks and merchants. Product data will need to become increasingly machine-consumable so agents can discover, compare, and evaluate products and services. Adoption is also likely to begin with lower-risk, lower-value transactions before expanding into more significant purchases as confidence grows: “spend 50p, not £4,000” was the informal test.

The discussion also highlighted an important payments consideration. Agent-initiated payments raise new questions around authorization, liability, dispute management, and consumer control. While the technology already exists, the industry is still determining the operational and governance models needed to support it at scale.

At the same time, AI is already delivering value today. Panelists noted that banks are actively exploring AI-assisted payment method selection, rail optimization, and payments remediation. In many cases, the limiting factor is no longer capability, but customer adoption and trust.

Takeaways for banks

• Establish governance frameworks for agent-initiated payments, including permissions, spending limits, revocation, and auditability.
• Focus first on low-value, high-frequency use cases where trust barriers are lower.
• Treat trust, transparency, and consumer control as foundational design principles.
• Start preparing now. The pace of adoption remains uncertain, but the direction of travel is clear.

Takeaways for merchants

• Ensure product information, pricing, and offers are machine-readable and easily discoverable by AI agents.
• Prepare for AI-assisted customer journeys, where product discovery, comparison, and purchase decisions may increasingly be influenced by autonomous agents.

The results are revealing. Cost and migration risk, often assumed to be the primary barriers to modernization, ranked well behind two other concerns: building a compelling business case and managing the complexity of transformation.

A second audience poll asked what is holding banks, issuers, and processors back from end-to-end modernization of their cards business.

For banks planning modernization initiatives, the message is clear. The challenge is not simply technical. Success depends on clearly articulating the strategic value of modernization, aligning stakeholders around measurable outcomes, and establishing a practical roadmap for change.

As the discussion highlighted throughout, modernization is no longer just about replacing legacy technology. It is about creating a payments environment that supports multiple rails, simplifies operations, improves resilience, and enables future innovation. The strongest business cases connect these outcomes directly to growth, customer experience, and operational efficiency.

Rather than predicting a single winner, the discussion highlighted three developments likely to shape the future of consumer payments.

1. First, programmable money and stablecoins are expected to gain traction in specific use cases, particularly cross-border payments, settlement, and treasury operations, before becoming a mainstream option for everyday consumer transactions.
2. Second, agentic commerce will continue to evolve as trust and adoption grow. The most successful use cases are likely to be those that deliver clear value to consumers while maintaining transparency, security, and control. Over time, AI agents may play a larger role in how consumers discover, select, and pay for products and services.
3. Third, interconnectivity across payment rails will become increasingly important. As consumer payment choice expands, the challenge will not be introducing more rails but ensuring existing rails work together seamlessly. Banks that can orchestrate payments across cards, pay by bank, instant payments, and emerging payment methods will be better positioned to deliver the experiences customers expect.

One longer-term theme also emerged: the convergence of payments and savings. As payments become more intelligent and programmable, household financial management could become increasingly automated, connecting income, bills, savings, and discretionary spending into a more unified financial experience.

The central question for banks is no longer which payment rail will win. The real differentiator will be the ability to deliver choice, trust, and simplicity across an increasingly diverse payments ecosystem. Institutions that can reduce complexity, connect payment rails, and adapt to changing consumer expectations will be best positioned for the next phase of consumer payments.