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Dependence on the card rails

For ISOs, MLSs and their processors, revenue is derived
from markup of interchange, as set by the card brands,
and associated fees. Hence, revenue is dependent on
signing up merchants and running their transactions on
the card brand rails. This also requires a close relationship
with the banking industry, which provides settlement of
funds to merchants.
Changes in the world of banks and card brands will impact
revenue and profitability for our readers. In addition, the
list of eligible employers is shrinking. Today, only six
legacy acquirers remain, and some analysts predict this
will shrink even further in the near future.

Skinner sees big changes coming in banking. The back
The future of payments: office is being affected by the cloud and data analytics; the
middle office by APIs and plug & play software; and the
front office by mobile devices and the Internet of Things.
An interview with But the big banks are driven by legacy core systems that
run on COBOL (43 percent) and use batch processing, so
Chris Skinner that is going to have to change.
A digital revolution

By Brandes Elitch Skinner sees the United States as a legacy economy with
CrossCheck Inc. a legacy infrastructure. This has implications for our
ISOs and MLSs, as it tends to reinforce our system of
ccasionally, people will ask me about the acquiring banks, processors, resellers and ISOs because
future of payments. I might be considered an it is so fragmented. He quoteed a statistic from Citibank
expert on the subject, based on the more than that in the next seven years, a third of all bank jobs will
O 30 years I've worked in the field of corporate be eliminated, and a similar one from Deutsche Bank that
cash management. But for this article, I was fortunate to half of all bank jobs will be eliminated. This should give
interview a real futurist, someone who spends most of his pause to people working for banks ‒ or processors, which
time thinking about the future by analyzing current events share numerous similarities to banks.
and drawing conclusions about where they could lead.
His name is Chris Skinner. Skinner said financial institutions aren't prepared for
the digital revolution. "Digital revolution is upon us
Skinner writes a daily blog at www.thefinanser.com. His … changing the way we talk, trade and transact, and
posts are read worldwide daily by many of the most changing the way we make business and relationships," he
senior people in banking and payments, where he also said. "It is a massively important moment and represents
has a thriving consulting business. The Wall Street Journal the fourth revolution of humankind, where for the first
named him one of the top 40 most influential people in time in history every person on earth can connect in real-
fintech. He also appears on a top five list of information time with every other human on earth, through a digital
security leaders, and has been voted one of the most network."
influential people in banking worldwide.
In the future, we will create data as currency. Dealing
Skinner's new book, Digital Human, analyzes such current with technology is different from dealing with money, and
developments as digital identity; new forms of currency; dealing with money through technology is different from
the dominance of Alipay, the world's largest third-party dealing with technology through money, Skinner added.
mobile and online payment platform; and the interface of For example, with the latter, we use Square, Stripe, PayPal,
banking and technology. He is also a compelling speaker. Venmo, Alipay and WeChat Pay ‒ payment systems that
I heard his talk at Money 20/20 2018, and this caused me shut out the ISO from revenue.
to think about the future of merchant acquiring. I am
concerned about the ISOs and merchant level salespeople "Those approaching technology from finance will be firmly
(MLSs) prospecting every day for new merchant accounts. grounded in rules and regulations, safety and security,
resilience and reliability; those approaching finance from
technology will be firmly grounded in innovation and

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