Payments are about the logistics to transfer money (value) from one to an other. Governments have long tried to control the mechanisms to pay as payments are an important part of the fabric of society being a conditio sine qua non for economic progress. Society has handed the operational aspects of payments to the banks a long time ago. Banks, and with them many others, then started to believe that payments are “owned” by the banks (as being commercial companies). This in my view is a dramatic fallacy. Payments are a social “product” by essence.
Payments are by nature used between two parties and should not be steered by a sub interest let alone be monopolized by commercial firms. Payments are moving into the commercial realm more and more though. Like with telecom this in itself is not a bad development as the legacy payment providers are not suited to create payment methodologies for the new internet based economy (i.e. not in functionality, not in innovative power not in position in the new fabric of the internet based society and economy, not with how they have shown to misuse their position to the point of sending our global economy in a total tailspin.) But there are negative effects of the commercialization of payments as well.
First of all with commercial companies at the helm not all of societies goals with payments are aligned with the quarterly profit driven molochs trying to corner by monopolising the “coins” or creating a publican roll the exchange of values on their gated network and ecosystems. This will hamper the way exchanges can be made outside the gated islands, or to deploy activities at multiple islands. The seamless and frictionless exchange of value between any two actors will be reduced with all negative societal and economic consequences this can hold.
Companies have political agenda’s by themselves. Whatever you think about the wikileaks episode the fact that US based credit card companies just blocked the possibility to sent the organization money (on the ground that it was not patriotic) brought it to its knees.
But also Apple does not allow all types of content on its services what in a way limits the ability of certain providers to reach an audience via one of the dominant (and gated) networks.
The payment method becomes synonym with the money it caries, with the superlative degree being digital money (e.g. Bitcoin). There is an other worrying aspect though: If the commercialization of payments merges with digital money (or gated islands “coins” like with facebook and Amazon) the ability for society to steer and control the exchange of value to the good of us all will be hampered.
In this light I am fascinated to see the emergence of Bitcoin and the way it is starting to get accepted as a way to pay: Pay Another Way: Bitcoin — Blog — WordPress.com.
At WordPress.com, our mission is making publishing democratic — accessible and easy for anyone, anywhere. And while anyone can start a free blog here, not everyone can access upgrades (like going ad-free or enabling custom design) because of limits on traditional payment networks.
Today, that changes: you can now buy WordPress.com upgrades with Bitcoins.
PayPal alone blocks access from over 60 countries, and many credit card companies have similar restrictions. Some are blocked for political reasons, some because of higher fraud rates, and some for other financial reasons. Whatever the reason, we don’t think an individual blogger from Haiti, Ethiopia, or Kenya should have diminished access to the blogosphere because of payment issues they can’t control. Our goal is to enable people, not block them.
Payments can contribute to the further democratization of the internet and our society.