Are payments eating the world?
A little treat for you. In a special bonus episode of our Fintech Insider Insights Podcast, we sat down with Jeremy Balkin, Global Head of Innovation and Corporate Development, Payments at J.P. Morgan.
What did we chat about? Well, their new ‘Payments are eating the world’ report of course! But not before we paused to wonder - when did payments get so sexy? Here’s a little summary of what went down. And be sure to check out the full episode here. It’s a doozy.
So...when did payments get sexy?
Pinpointing a precise moment is hard. But over time our understanding of payments has evolved. Historically they were viewed as exchanges of paper and, later, value and data. And soon we realised that that was something people did all the time, instinctively.
If we’re living in the era of payments, then the last 15 or so years has been the era of smartphones. The iPhone came out in 2007. Nine years later, there were 3.67bn smartphones on the planet. Flash forward to 2026 and 91% of the global population will have one. The rate of growth is mindblowing.
Connecting people this way gave rise to vertical platforms. We’ve gone from connecting people to connecting these platforms through the exchange of data. And that’s what payments are.
So: the era of payments.
Let’s not forget that in the last decade, $1.5tn has been invested into fintech. A lot of the biggest fintechs in the world are payments companies. As of September 2021, PayPal sits right at the top of the tree with $341.08bn in market capitalisation. In roughly that same ten-year period, payments companies comprised 25% of total shareholder return in publicly listed companies. Asset management, investment banking and consumer banking were all left in the dust. What can we attribute this phenomenal success to? Technology, mobile connectivity and the platformisation of the economy played their part.
Asset management, investment banking and consumer banking were all left in the dust.
And to top it all off, innovation is going at a rate of knots! It took about 15 years to get from PayPal to Apple Pay, Samsung Pay and the mobile wallet. Now we’ve got crypto. Where will we be in 2031?
What’s JPM doing in the payments space?
It might save time to ask what they’re not doing in the space! JPM are the leader in payments. They’ve been right at the forefront as payments have gone from sleepy to sexy - seemingly overnight.
Remember that this is the part of financial services that arguably has the most impact. Efficiently moving capital around the world changes lives. The difference between receiving a payment today or tomorrow can be the difference between life and death for small businesses and individuals. And that’s what JPM aim to make.
Remember that this is the part of financial services that arguably has the most impact.
They move about $8tn a day. One in every four US dollars that goes around the world goes through their payment rails. And they’ve got some big plans for expansion.
What about this report?
That’s where ‘Payments eating the world’ comes into it. And it couldn’t have come sooner. It outlines JPM’s vision for the future and where they exist today. It details how payments are at the centre of everything (hence the title) and how they support their clients. It speaks to JPM’s aim to be the world’s most trusted global innovator in payments. Check it out for yourself.