The Audacity of Payments
How do you define audacious? I define it by way of example, more specifically, by someone who traverses the contiguous 48 states over 5 months in a well-worn Ford Escape.
Though this scribe is not too audacious, I had the pleasure of meeting up with the individual referenced in my aforementioned example. Some of you might be familiar with Bailey Reutzel, an exceptional fintech reporter who’s spent the past few years at PaymentsSource and American Banker. She’s now somewhere on ‘the road to find out’ (a la the former Cat Stevens)…chronicling the philosophy of money/value in a great blog called Moneytripping.
Bailey and I met up at our recent R2 retail conference in Chicago, which occurred just after Loolapalooza, one of the world’s best music festivals that she also attended (an interesting transition from seeing innovative acts like TV on the Radio and Alabama Shakes to seeing innovative retailers like Domino’s and Nordstrom).
So Bailey, why embark on this tour?
The concept of money and value is changing drastically—that’s part of this vast and rapidly-evolving digital currency revolution. How do people relate to money, what do they think is valuable, how do they interact with the financial system—these are topics I’ve wanted to cover for some time. I was recently at a conference in NYC and a young dad was talking about an experience he had with his kid. He gave a physical dollar to his son. His son, probably 9 or 10-years-old, knew it was a dollar, but associated paper money with charity drives at school or handing money to homeless people on the street. When it came to buying toys, he only associated plastic with that process. That’s when I started wondering how the nature of money changed between demographics and cultures.
The tangential concept I want to undertake is ‘what is value' as it relates to the ‘sharing economy.’ Take Couch Surfing, a great example of an informal economy…or Task Rabbit, an example of the odd job economy…or Lollapalooza, a volunteer economy. Each of these economies is prevalent within my generation, the millennial generation, and millennials are making their own definitions for all aspects of their day-to-day lives.
Initially, I was finding it challenging to define what I was exploring. But as I've done some research on the road, I've found a term that I think applies to what most of my reports have turned into: political economics. It's the study of production and trade and how that relates to culture and customs, the government and politics and both equality and inequality. It's a branch of moral philosophy, which I've always been drawn to writing about.
So can you talk a little about what you’re seeing, regionally speaking?
It’s no surprise that the coasts are predominantly early adopters of technology, the middle of the country…not so much. Bitcoin has a libertarian bent. The new conservative in the Midwest is a pseudo-libertarian. Early on in my travels, I came to the realization that Bitcoin and the Midwest work together—there are parallels between the beliefs in the Midwest of and the tenets of these decentralized virtual currencies.
Ah, good ol’ Midwestern ideals. Do many Midwesterners know what bitcoin is?
Many at least know about it, though it’s not pushed as heavily as it is on the coasts. Bitcoin aligns with the Midwestern contingent that is very much against government ‘spying,’ for lack of a better word.
Evoking thoughts of Edward Snowden.
You were among the earliest trackers of bitcoin and alternative currencies. What is it about virtual that’s resonated with you? Anything in particular minus what you discussed above?
I’m interested in alternatives to the status quo. Bitcoin provided that, but now it’s being appropriated. Ultimately, it’s still very much alternative. Because as Bitcoin gets appropriated, because it's open source, new alternatives can surface.
What’s your stance on tracking transactions? Where’s the line between privacy and transparency?
Millennials are seen as the demographic that doesn’t care about privacy, hence their very public social media feeds. And the idea that there are ultimate secrets is dead—many of us are more open as well as open-minded, which will lead to even fewer secrets. And that's not a bad thing.
I personally don’t care if the government wants to look at my transactions. Ultimately, I feel the government’s job is to protect us, its citizens, and so if they need to monitor transactions to do that, then I say go for it. But I see the other side. Ultimately there's a fine line between surveillance and Minority Report.
What do you think is next on the horizon, from an overall payments trend?
I think it’s all about peer the peer. Unlike in the past, where the large corporates had direct involvement, people will be able to handle all aspects of payments directly.
Do you think cash is king? Is it the king currency?
Cash will continue to be a big part of the economy. Think small corner stores, the bodegas in NYC that don’t accept cards; they’ve long been cash-only and will continue to be cash-only. They don’t want to pay fees. And consumers understand that and will gladly accept that decision.
The ‘cash is king’ mantra has come back around, and hearkens back to fiat currency as a low-cost public good so that consumers can interact with the economic system. We’ve moved away from that to an extent—with private companies and closed-looped networks operating digitally. With the rise of bitcoin and other alternative cryptocurrencies, we might find a digital equivalent to cash.
As Bailey continues her Moneytripping tour, you can follow along at http://moneytripping.com/.
Related Blog Posts
Regulating for Real-Time: The Role of Government in Payments Modernization
Dr. Leo Lipis and Craig Ramsey, Head of Real-Time Payments for ACI Worldwide, continue their discussion on real-time payments and the findings of the new white paper, Get More from Real-Time.
Issuing and Acquiring in a Real-Time and Open Payments Ecosystem – The Global Picture
Dr Leo Lipis and Craig Ramsey, Head of Real-Time Payments for ACI Worldwide, continue their discussion on real-time payments, stemming from the findings of the new white paper, Get More from Real-Time. See part one.
SWIFT gpi: Leveraging Cross-Border Payments for the Real-Time World
SWIFT gpi represents the evolution of business done over the SWIFT network, bringing correspondent banking into the digital era.
I’ve covered this topic before, but with gpi now reaching the two-year milestone, it’s a good chance to reassess the progress that has been made – and what is needed to drive further adoption.
The Race to Real-Time Payments in Europe
Instant payments have quickly morphed into the new norm, and as individual European nations forge a real-time, digital-first payments environment, they raise the bar for all financial institutions conducting business in the Eurozone. It’s no longer a question of “what’s the business case?” but a matter of how instant payments players can take advantage of the opportunities now being created.
Der Wettlauf um Echtzeitzahlungen in Europa
Echtzeitzahlungen haben sich zur neuen Norm entwickelt. Indem einzelne europäische Länder die Rahmenbedingungen für digitale Echtzeitzahlungen schaffen, setzen sie neue Maßstäbe für alle Finanzinstitute, die Geschäfte in der Eurozone abwickeln. Es geht nicht mehr um die Frage „Was ist das Business Model?“, sondern darum, wie Akteure im Bereich der Echtzeitzahlungen die sich bietenden Geschäftsmöglichkeiten erfolgreich nutzen können.
Local Perspectives: Real-Time Realities Across Asia-Pacific in 2019
Money20/20 Asia returns to Singapore this week, attracting payments professionals from around the vast APAC region – and beyond. The real-time and open imperative is one of the reasons why all eyes are on Asia-Pacific when it comes to payments, so I caught up with ACI payments experts representing three of the key countries within the region, to take the pulse of real-time schemes that are in varying stages of maturity.
What it Means for a Bank to be Real-Time Ready – It’s More Than Just Payments
Banks are quickly learning that real-time enablement of the business is more than just a technological upgrade – there is a wider challenge of transforming services and customer experience. Although the banking world faces this challenge with some trepidation, there are success stories from other industries that have overcome legacy technologies and transformed frustrating and opaque customer experiences.
Instant and Open Payments for Consumer Purchases – Lessons Learned From India and Beyond
Did you know that 65% of merchants want to accept instant payments? That’s because they know the customer experience (CX) benefits will drive growth for their business, and they recognize that this payment type will save their business money.
Putting Malaysia on the Path to Payments Innovation
The public launch of the DuitNow instant credit transfer service, in December 2018, provides just a taste of what lies ahead as Malaysia’s Real-time Retail Payments Platform (RPP) is progressively rolled out. Fueled by Bank Negara’s (BNM) increasing support for e-payment platform development, there has been a steady increase in mobile wallet and digital payment usage, setting the stage for 2019 to be a year of transformation for the payments industry in Malaysia.