CHAPTER 17The Future of Payments

Ruth Wandhöfer

The world around us is transforming at a mindboggling rate. Digitisation, automation and artificial intelligence (AI) are expected by some to lead us to ‘the singularity’ – that is, the development of a computer-based intelligence that will not only be indistinguishable from human intelligence (the Turing test), but will far exceed it and fundamentally change every aspect of society.1

For some that may sound too revolutionary to be credible, but many small revolutions are already here, not least in financial services and, in particular, in payments. During the last decade a combination of technological innovation and regulatory realignment has opened up the market for new players, new business models, new products and services and new ways to consume those products and services. In this chapter we examine the developments in payments in Europe and the UK, provide an overview of the state of play and take a look at what the future may hold at the international level.

Introduction

Payments innovation in Europe arguably started with the arrival of the European Commission's first Payment Services Directive (PSD1) in 2007.2 The EC's overarching aim was to ensure ‘the proper operation of the single market in payment services… [and] a level playing field for all payment systems, in order to maintain ...

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