Steve Percy
President, Diolkos Commerce Solutions
Oct 2022
"To reach a port, we must sail, not tie anchor, and not drift." - Franklin D. Roosevelt
Isn't every CEO of every Financial Institution looking for a breakthrough in the saga of payments exchange ?
A Financial Times article published in late September proposes that JP Morgan is looking for Pay-by-Bank “Payments Nirvana”, a place that Diolkos is able to take them and all their other regulated banking partners/competitors. In fact, the only way for consumers and businesses to jump to the next generation of payments is to move in the direction that Diolkos’ promises.
The Financial Times article hits on all the anchors and frustrations of the important stakeholders. Revenue cannibalization, interchange rate wars, technology limitations, reward program integration, internal revenue attribution (transfer pricing), interconnecting aging systems... Who can step up and provide a solution to address all stakeholder needs ?
Can any one bank solve the problem with their own solution ? Can the industry through massive joint committees solve it with initiatives like TCH’s RTP or The FED’s newest project FEDnow ? And what about international exchange ? Are all these initiatives coordinated with other jurisdictions in any manner other than SWIFT’s ISO20022 standard ? Is every jurisdiction implementing the "same configuration" of ISO20022 ? Experts have weighed in for the last decade and they have stated that international integration of real-time payments is not possible with these approaches by the end of the “next” decade.
The next generation solution must embrace all industry stakeholders and address convenience, simplicity, payment reconciliation, authorization, fraud security, local fiat currencies, as well as meet the needs of the next century with new capabilities for effective commerce across all user exchange groups (C2C, B2B, B2C, G2B, and G2C). For example, split/shared transaction exchange from/to multiple banks, Payment Approval from any FI, Loyalty Program integration into the core exchange solution, payment pre-authorization for all, Time-Sensitive/Escrow payments, Auto FX on Cross-Border exchange, … Bankers providing a whole new suite of services and users interacting on payments with significantly more control and trust.
Now according to the article, JPM has been on this quest for the last year. They recently purchased Renovite Technologies which gives them both Cloud engineering and capabilities in the Cloud Merchant API connectivity arena. What else has been accomplished ? No idea. But to be sure they will not have redesigned a completely new and independently operating global payment exchange platform that can bring their competitors and partners on board for a fully distributed independent payment network. A platform that can share a single payment amongst more than one Payor operating through multiple FI’s in multiple jurisdictions to multiple Payee’s operating through multiple FI’s, including multiple Approvers (if desired) operating through different FI’s [again, in multiple jurisdictions].
Current payment industry participants have only experienced “A swing and a miss for strike three…” as FINTECH's and Banks bring a new bat to the plate and continue on to another extra inning. But the Commissioner has finally deemed changes are required and that Payment Fans are due for a better world. The new uniform has a Diolkos label.
"Give me six hours to chop down a tree and I will spend the first four sharpening the axe." - Abraham Lincoln
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