Call for Papers - Fintech’s Impact on Payments

Call for Papers

Fintech’s Impact on Payments — A special issue of the Journal of Payments Strategy & Systems 

Guest-Editor: Harish Natarajan, Lead – Payments and Market Infrastructures, World Bank

Submission deadline: 18th August 2020

The safe, reliable and efficient functioning of the economy, financial markets and financial services are dependent on well-functioning payments and market infrastructures and universal access to payment services for individuals, businesses and government agencies. Innovations in the real economy and payment services are mutually linked and reinforcing; this is best illustrated by the example of ride-hailing companies and “pay-as-you-go” models. The push to make payments “invisible” in ride-hailing services requires the means of payments to be provisioned in multiple “form factors”. The wide availability of payment services, increasing speed and easier integration with real-world interactions enable new business models like “pay-as-you-go” provision of essential utility services like electricity and water. 

This close linkage between Fintech and payments is manifested in the lion’s share of entrepreneurial activity and venture capital funding going towards emerging markets. There the limited level of financial inclusion is driving innovation in payments – nearly half of the gains in financial inclusion in the period 2011-17 in Sub-Saharan Africa has been on account of growth in mobile money and the impressive gains in the same period India have been on the back of advances in payment systems and Digital Id. 

Payments are often the first beachhead for BigTech companies. For banks, payments are the most data rich financial service that helps establish a connection with the customer. This makes payments one of the areas in financial services seeing the highest levels of competition between and amongst incumbents and fintech companies.

The regulators are stepping in against this backdrop to shape the development of the payments market and leverage the advances in payments to achieve broader policy goals in the financial sector. Regulators are also evaluating and calibrating their role in the provision of payment services. Currency and money are fundamental concepts in the financial sector and have been taken for granted for close to 100 years. The key component of the ongoing FinTech phenomenon has been premised on questioning these basic constructs on which the entire financial system has been built.

Bitcoin introduced the prospect of transferring money and making payments without any intermediary – no bank, no mobile money provider, no Visa/MasterCard - showing that functions of the financial system could be executed by decentralized networks. It removed trust from being extrinsic to the system (controlled by institutions) and weaved it into the grain of the system itself. Bitcoin, while having limited use as a unit of account, has made us question what money is, in what form it should be, and whether we really do need an issuer of money. The onslaught on these concepts is not new, several attempts have been made to create alternatives to money like e-Gold, but none have succeeded. But now the attack seems to be stronger, first came Bitcoin followed by a whole slew of cryptocurrencies. The debate then started to move towards the underlying blockchain and distributed ledger technology and is now leading to discussions on whether central banks can themselves issue currency with some of the features of a cryptocurrency.

Lastly, the public and private sector’s response to the unprecedented COVID-19 pandemic has shown the importance of digital means of making payments. Countries that have made strides in digital payments seem to have been able to respond more boldly and with agility and have been able to take advantage of the digital economy models for conduct of business, learning and medicine. 

The Journal hence finds it timely to take stock of current developments, initiatives and reflect on the medium- and long-term impact of Fintech on payments.

Fintech and payments are intricately linked, and it is difficult to draw the line between traditional payment services and fintech enabled payments. In this call for papers, we will distinguish between: (1) payment services that rely on dedicated physical devices and infrastructures; and (2) digital payments that rely on general purpose devices like mobile phones and other internet connected devices. Papers in this edition of the journal should focus on the latter. Digital payments include provisioning of payment cards as tokens and QR codes; mobile money; and payments made directly from transaction accounts using APIs and other similar technologies. In addition, papers assessing developments in digital currencies and their usage for payments are also considered to be in the scope of this edition.

Leading practitioners are asked to give their views on the most important topics in this context, including:

The payments market

•    What is driving Fintech interest in payments and what has been the impact on the payments market so far in terms of market structure, competition and efficiency?

•    How are digital payments and fintech improving societal welfare and what is the evidence for this?

•    What are the key success factors for Fintechs in the payment’s domain – what is the empirical evidence for this?

•    Are Fast Payment services the new normal – will they overtake other traditional payment services in terms of both usage and value of payments?

•    What are the key attributes of fast payment services that influence adoption?

•    What is Fintech’s role in the emerging ‘faster’ and ‘immediate’ payment systems?

•    Is Fintech making payments a commodity business that is to be provided for free?

•    What is the impact of fintech on remittances and cross-border payments and what needs to be done to fully leverage the potential of Fintech for these payment streams?

•    Are digital payments and Fintech only relevant for consumer payments? What is the potential of digital payments and fintech for Business-to-Business payments?

Response of Regulators

•    How are regulators responding to the rapid developments in digital payments and Fintech? What regulatory approaches are working, which ones are impeding market development and which ones are challenging the traditional regulatory constructs?

•    What significant adjustments to e and m money could regulations introduce to enable new payment schemes to emerge (such as the likes of AliPay, WeChatPay and other schemes such as iDEAL and Swish)?

•    Could Fintech play a significant role in addressing new emerging trends in payment fraud?

•    Could Fintech enhance modernisation of RTGS systems?

•    How do we measure the development of digital payments and Fintech in a country?

•    Can we declare that cryptocurrencies have failed in their quest to become a means of payment?

•    Are stablecoins and global stablecoins (like Libra) inevitably poised to overtake traditional payments systems?

•    Are CBDCs relevant for financial inclusion?

•    What would be the effect of CBDC, multi-currency CBDC and synthetic CBDC on the payments market?

Payments during COVID-19 

•    How have countries leveraged digital payments in the COVID-19 response?

•    What lessons can countries draw from the performance of digital payments in COVID-19 pandemic for their future national payment strategies?

•    The impact of Coronavirus on the Fintech sector.

Submission Guidelines:

The deadline for the submission of articles to this special issue is the 18th August 2020.  The following types of articles will be considered for publication:

Practice articles: Thought leadership pieces, regulatory updates, briefings, case studies and other contributions written by practitioners. Articles should be 2,000 to 5,000 words in length.

Research papers: Contributions which explore new models, theories and research in Digital payments and Fintech. The principal management implications of the submission should be included. Articles should be up to 6,000 words in length.  

Author guidelines, sample articles and other relevant information about the journal can be found here.

Questions about this issue may be directed to the Guest Editor, Harish Natarajan and Julie Kerry, the Publisher.

Manuscript submissions should be submitted to the Publisher, Julie Kerry