Are the payment processors (Visa, Paypal, payment processors) becoming the new banks? Will they take over the traditional role which saw banks as the holders of personal wealth?
Banks arose as places of transaction where something of value could be exchanged or held to facilitate commerce. Of late many of them seem to transmogrify into traders themselves, so witness the use of complex derivatives and speculation for its own sake rather than the more humdrum idea of transferring currency and acting for escrow. In other words banks seem to think they are a business in their own right! Given that much commerce is moving online, why do we need banks? Most of my wages go directly into paying bills and daily living, very little goes into investment although the traditional banks would like you to think that’s their role. I see a collapse of the need for banking once a new and simple means of exchange arrives, in pretty much the same way that movie houses are being disintermediated by the arrival of self-produced and direct to consumer mechanisms such as YouTube. While cinemas won’t disappear immediately they are far less important now than they used to be.
But with the rise (and now wane) of the internet, mobile world and especially the Internet of Things it seems that banks may be superfulous – after all most of us nowdays never enter a bank branch to transact and I’m simply astonished even when they ask you to ‘print, sign and return’ some form.
Am I about to become one of the great ‘unbanked’? Could I ditch banking altogether and survive using Other Means of Exchange?