Digital wallets and the use of QR codes have enabled peer-to-peer payments take off across the world, particularly in Asia. This is not news, and for a long time my impression has been that the credit-card companies aren’t too bothered.
Yes, they are being shut out from new ways for people to make payments. But card growth has continued. The networks they operate, based on the four-pillar model (consumer, consumer-card issuer, merchant acquirer, merchant), seem indomitable. There’s always grumbling about such rails, dominated by US giants like Visa and Mastercard, but look at repeated European attempts to come up with a competitor—hopeless!
However, Brad Jones thinks otherwise. He believes wallets, in which your money is held in your own account and not on someone else’s deposit account or payments network, is a real threat to the big processors. And by extension, to many commercial banks, whose own reluctance to service relatively expensive, low-income customers may prove to be self-defeating. At the end of the conversation we also touch on new factors driving P2P wallets: agentic AI and stablecoins.
Brad’s the right person for this conversation. His early career included a role at Visa that was involved with the company’s first attempt to acquire a mobile wallet operator, Fundamo in South Africa. He’s been CEO of two mobile-wallet companies on different ends of the spectrum: WaveMoney in Myanmar, and HSBC’s PayMe in Hong Kong. Today he’s a consultant to payments fintechs in Asia and Africa.
Timecodes:
0:00 - Introduction
02:01 - Brad Jones and his early experience at Visa, looking to embrace mobile money
4:06 - Takeaways from Visa’s acquisition of Fundamo
5:55 - How have QR codes changed the economics for banks or payment processors?
9:06 - What gets lost in services and revenues in new models based on public infrastructure and zero MDR?
11:25 - Can P2P scale to B2B and large corporate needs?
13:47 - Why scheme providers have been asleep at the wheel and face long-term risk of being overtaken by wallets.
16:48 - Banks versus wallets, comparing North versus Southeast Asia
20:26 - Will banks offer wallets to new customers or will wallet providers evolve into banks?
22:21 - Can financial institutions learn to serve small, low-income customers and small businesses?
25:19 - Winners and losers
26:56 - Integrating stablecoins into wallets creates another challenge to credit cards
29:15 - Contact Brad
