Now put the fast forward mode on. PSD2 has been implemented. You are doing your shopping again, but instead of entering your debit or credit card details, you are asked if you want to give to the retailer access to your bank account. You agree and the merchant redirect you to the banking website, where you give your permission. This is like the way you allow applications to access your Facebook or Twitter accounts today. You do not give your banking details to the merchant, or something like that. The retailer asks for your details to your bank account and you just give the permission to the merchant to execute payments on your behalf via your internet banking account.
Then, at the end of this value chain, it is not a butterfly effect anymore but a storm. The major payment companies in the world (Visa, Mastercard, ACI, Ingenico, Wincor,…) have already adopted our strategy a couple of years ago.
However, the banks have not changed their habits yet. They have just adapted their market to the fintech effects and they think it is just necessary to buy start-ups in the financial fintech area to stop changes. They believe it is a good opportunity to add new services. Marcel Proust said:
« Le véritable voyage de découverte ne consiste pas à chercher de nouveaux paysages, mais à avoir de nouveaux yeux. »
« The true discovery travel is not to look for new landscapes, but to see with new eyes. »
Furthermore, the main European banks do not have new eyes. When they will understand, it will be too late.
Combining the PSD2 regulation and open architectures (open API, cloud solutions, biometric security) gives to the GAFA and the great retailers a real opportunity to process the payments outside the traditional banking channels.
This disintermediation storm is more important than the subprime mortgage crisis, because this is not a speculative bubble. For 1 million euros in the disintermediation exchanges, you have 1 million euros lost in the bank accounts. At the end of 2015, thanks to the new payment solutions the retailers already had 115 billion euros in the world, with a low cost.
Banks, wake up, the storm is here. Your benefits will decrease quickly if you believe it is just necessary to buy start-ups to continue. This is a big mistake. It is necessary to work with the major payment companies and to change your strategy. In 2018, if you have just your legacy platforms, your legacy customer’s applications and a few new services, it will be too late.