Payments in transition: the forces shaping the future of global money movement

Albion Murati from McKinsey & Company explains how fragmentation, stablecoins, and AI are reshaping payments and why innovation, not scale, will drive the next phase of global money movement.

 

What payments trends are most overhyped right now, and which one is quietly becoming foundational for how money will actually move in the next 3–5 years?

Three forces will truly transform the payments industry.

The first is the fragmentation and regionalisation of the payments landscape. On the surface, this has been driven by constant innovation in payment systems and technology, which has resulted in competing infrastructure choices. However, if we step back, the most disruptive force in payments over the last decade has not been technology alone, but geopolitics and regulation.

More specifically, geopolitics has reshaped underlying trade routes. And ultimately, to understand payments, you need to understand commerce and trade, because that is what drives the movement of money. At the same time, we have seen geopolitics fundamentally change how we think about value chain constructs across regions. As a result, fragmentation of systems has become one of the defining structural trends in payments.

The second major force is the adoption of stablecoins and digital assets, which represents a genuine turning point. The promise of blockchain-based payment systems has existed for more than a decade, and eight or ten years ago, it was clearly overhyped. Today, however, we are at a very different inflection point. This time, the technology is there, the ecosystem of providers is there, and, critically, we finally have enough regulatory clarity to enable real money movement in a stable and compliant way. That said, the promise still far exceeds today’s reality. Daily transaction volumes linked to stablecoin payments remain relatively small, at around USD 390 billion annually (or roughly 0.02% of global payment volumes) but continue to pick up rapidly.

What makes this particularly interesting, though, is where adoption may take off. In this case, innovation may begin on the corporate or treasury side before expanding into retail. Historically, many payments innovations started with consumers and then moved into corporate use cases. Here, we are seeing the opposite dynamic. Much of the early momentum around stablecoins is concentrated in B2B use cases such as corporate treasury movements, cross-border flows, and liquidity management. That is what is driving adoption today, and over time, this momentum could spill over into retail.

The third major force, and one I genuinely do not think is overhyped, is AI and its transformation potential. In fact, payments, more than almost any other sector, is particularly prone to being transformed by AI. I believe this transformation will unfold in two distinct steps.

First, there is the impact on how payment companies operate internally. If you look at the cost structure of a typical payment company or transaction bank, around 60-70% of the cost base sits in three areas: IT, customer operations, and product development. The remaining costs are spread across functions such as risk, sales, and marketing.

Those three core domains are exactly where agentic AI delivers the biggest impact across industries. As a result, if you imagine a scenario where a significant portion of that cost base could be reduced by 30-50% over the next few years through widespread adoption of agentic AI, the implications are profound. It fundamentally changes how payment players operate and creates a massive value creation opportunity for the sector.

Based on our estimates, this could unlock up to one hundred and ten billion dollars in productivity gains across the industry. That is significant, both in terms of shareholder value and broader societal impact.

The second step, however, goes beyond efficiency and into a reshaping of the value chain itself. While agentic commerce is a major theme, particularly for B2C or C2B use cases, I am even more excited about what this enables on the B2B side.

For example, think about fully automated treasury flows, where agents manage cash pooling positions across geographies in real time. Or consider the original promise of Open Banking, greater transparency and better data, now fully automated through agentic systems.

As a result, we are going to see a real revolution in how payments data is used, how payment flows are optimised, and how decisions are made. And importantly, this will not be limited to commerce use cases. In fact, I believe the biggest wave of innovation will occur on the B2B side, with a complete rethinking of payment use cases.

That said, we need to consider what could hold these transformations back, and a few key factors stand out.

First and foremost, user experience and adoption will be critical. Payments have a unique way of moving slowly and quickly at the same time. Ultimately, all this innovation must deliver a clear step change in value for consumers and corporates, whether through better economics or fundamentally better experiences.

While the industry has already made major strides in efficiency and speed over the past decade, many of the basics are now largely in place. If you think about the Maslow pyramid of payments, a lot of foundational needs are already being met far better today. Therefore, to truly drive adoption, especially for stablecoins or agentic flows, the industry needs to deliver experiences and benefits that feel materially different, not just incrementally better.

Second, there are critical questions around customer protection, data protection, and consent. A very concrete example is how customer consent is managed in an agentic commerce model. This is not a theoretical issue, but a practical one that the industry needs to solve properly.

Finally, there is fraud. Across every geography today, even in places like the Nordics that historically had very low levels of fraud, we are seeing fraud increase. As new technologies and models are introduced, how the industry addresses fraud will become even more important. On one hand, the bad guys have more tools than ever, on the other hand consumers are using technologies that are inherently vulnerable. This will be a major challenge for the industry ahead.

Ultimately, getting these elements right will be essential to ensuring that these transformations are not only possible, but sustainable.

As real-time payments, wallets, and account-to-account rails scale globally, where do you see the biggest structural bottlenecks (regulation, fraud, legacy infrastructure, fragmentation, or business models) and which players are best positioned to break through them?

Over the last decade, there has been a substantial amount of investment and innovation at the very core of the payments system.

If you look at how many countries, over the past ten to fifteen years, have implemented real-time payment systems or modernised their national payment infrastructures, the progress is clear. At the same time, we have seen entirely new rails emerge, with stablecoins being the most obvious example. Even established players like SWIFT have been innovating, introducing blockchain-based initiatives such as its ledger work and new cross-border schemes.

So, at the core of the system (the ‘reactor,’ so to speak), there has been a lot of innovation. However, when you move one layer up the value chain, that is where momentum starts to slow.

Specifically, if you look at processing systems and payment platforms inside many banks, many of them are still running on legacy infrastructure. In my view, that is a major bottleneck. It prevents banks from fully taking advantage of the capabilities that these new rails and modern infrastructures offer.

If you then go one layer further up the stack, the challenge becomes even more apparent. We have not seen a significant wave of innovation in end-user solutions. Europe is a good example. In the Nordics and parts of Southern Europe, Portugal and Spain in particular, we saw a wave of peer-to-peer interfaces launched eight, nine, even ten years ago.

Since then, APIs and Open Banking have followed, after many years of development, and are now live. However, despite that progress, we still have not really seen the next generation of end-user solutions, either on the retail or the corporate side, being pushed meaningfully by banks.

As a result, this is where the system gets stuck. Banks need to upgrade their payment systems, but at the same time, they also need to rethink what truly novel customer solutions they can build on top of these modern infrastructures. Without that second step, it becomes very difficult to break through and fully capitalise on all these new payment rails.

One of the hurdles that has held banks back, at least to some extent, is regulation. Today, there is still a lack of sufficient harmonisation of requirements across payment systems and jurisdictions. From a bank’s perspective, this creates real uncertainty. Do you bet on instant payment rails? Do you modernise your systems around instant payments? Or do you build for central bank digital currencies? Or for stablecoins?

In many cases, banks feel they are being forced to choose between multiple infrastructures to develop against. This also further increases the already heavy burden of compliance (incl. sanctions/AML) across infrastructures to ensure the right level of quality. However, more fundamentally, the issue still comes back to their own internal payment systems. That is where the biggest innovation gap remains.

That said, looking ahead, I would expect that over the next 2-3 years, we will see a meaningful acceleration in banks investing in payment system upgrades. Historically, this has been difficult for banks to prioritise relative to other initiatives. Increasingly, though, that calculus appears to be changing.

Despite continued growth in payment volumes, margin pressure across the ecosystem is clearly intensifying. Looking toward 2026, where do you see the most credible opportunities for players to rebuild margins and where do you believe value is structurally gone, regardless of scale or efficiency gains?

At its core, this comes down to one thing: innovation. For years, the belief in payments was that scale was everything. Banks and payment specialists aimed to drive as much volume as possible through their systems, creating value through sheer size.

But that no longer works. Traditional merchant acquirers and transaction banks are squeezed. Volumes grow, yet the cost to stay compliant and upgrade systems has risen sharply, often without payoff. This is why margins are tightening and value from scale alone is fading.

On the other hand, companies that scale within specific verticals and add services like fraud protection, analytics, or expanded offerings for consumers, merchants, and corporates have found real value.

In short, rebuilding margins isn’t about volume (alone) anymore; it’s about product innovation and attaching differentiated services to payments. The industry must rethink what genuine innovation means for all players, as that will drive the next wave of growth and value creation.

For years, the race was to achieve the largest scale. Today, that’s not enough. The focus needs to shift from generic scale to scale in specific verticals, use cases, and solutions, paired with targeted differentiation. That is where margins can still be rebuilt. Everything else, despite efficiency gains, is likely gone for good.

How is AI currently enhancing payments operations like fraud detection and transaction routing, and what potential does agentic commerce hold for consumer and merchant experiences?

As discussed above, payments is one of the most attractive sectors when it comes to the application of AI, and arguably one of the most prone to transformation.

When it comes specifically to fraud detection and transaction routing, it is worth noting that this transformation did not start with generative AI. For a long time, payment networks, banks, and specialised providers have already invested heavily in advanced machine learning based systems for fraud detection and transaction monitoring.

Where the next wave of innovation is happening, particularly over the last twelve to eighteen months, is through the application of agentic AI across the full fraud value chain. Detection itself can still rely on traditional AI models, but areas like fraud investigation, transaction monitoring, case management, and regulatory reporting are increasingly being automated through agentic systems.

These are processes that have historically relied heavily on human intervention. By applying agentic AI end-to-end, payment companies can significantly improve accuracy, increase coverage, and review far more transactions than was previously possible.

A similar dynamic is playing out in transaction routing. This has long been an optimisation use case, and many large players have invested heavily in improving authorisation rates and routing logic. AI-driven optimisation in this area directly improves customer experience while also increasing acceptance rates and revenue for payment providers.

Beyond fraud and routing, AI is also transforming how payment companies build and operate their platforms. We are seeing widespread adoption of AI to accelerate software development, modernise payment systems, and build entirely new solutions. At the same time, agentic workflows are being used to reinvent operations, from automated merchant onboarding and ongoing due diligence reviews to customer service. In some cases, this can reduce the volume of manually handled cases by as much as 50%.

That is the operational side. On the experience side, agentic commerce has the potential to be equally transformative for both consumers and merchants.

For consumers, the promise is simple but powerful: a personal assistant that helps manage complex payment journeys. We are already seeing people plan holidays, events, and even major life moments through conversational interfaces. These journeys typically span multiple merchants and services, from travel and accommodation to transport, dining, and entertainment.

As these journeys consolidate into a single interface, the value for consumers is massive in terms of convenience. At the same time, this has clear implications for merchants. Commerce is likely to become even more concentrated around the platforms and marketplaces that control these agentic experiences.

Merchants that can invest in strong agentic capabilities can capture a much larger share of customer spend by covering not just a single transaction, but an entire journey. Conversely, merchants that are not part of these ecosystems risk being further disintermediated.

For payment companies, this also means increased concentration of where merchant flows are initiated. As a result, providers will need to rethink their value propositions to remain relevant to the platforms and merchants that sit at the centre of these agentic journeys, and to ensure they win share where it matters. 

What shifts in competitive differentiation will AI agents introduce for wallets, platforms, and intermediaries?

First, the less exciting but critical part: all payment companies need to get operationally fit.

Before differentiation, there’s a hygiene factor. Payment players must examine their cost base and internal operations. They need to develop software faster, handle customer requests more efficiently, and boost productivity. Transforming internal processes and operating models is essential just to stay competitive.

This also gives legacy players a chance to catch up with industry leaders if they move fast enough. Beyond this baseline, real shifts in the value chain emerge in key areas.

First, payment networks. In an agentic commerce world, networks aim to play a central role by building infrastructure services to enable agent-driven flows. Agentic commerce is like the Apple Pay moment – a new kind of digital wallet.

Networks compete to set standards, shape consumer experiences, and enable personalisation. They also collect and use data to optimise transactions and strengthen customer authentication. Visa and Mastercard are extending tokenization, passkeys, and authentication engines for this new world.

Second, intermediaries like PayPal, Stripe, Worldline, and Adyen are developing agentic protocols. Their challenge is ensuring acceptance solutions work smoothly within agentic flows. With regulation still evolving, interim solutions like virtual cards or tokenized payment instruments will likely emerge, allowing agents to make secure payments for specific merchants.

They’re also building merchant tools – from conversion optimisation to agent-compatible checkouts – where differentiation returns amid margin pressure.

More broadly, agentic commerce opens new service opportunities beyond payments. Companies close to customers can extend value propositions. Square, for example, offers tools to help small businesses onboard staff and automate workflows.

Ultimately, competitive differentiation will come down to who owns the customer relationship and interface. Payment companies are uniquely positioned to lead innovation and capture a meaningful share of the opportunity ahead.

 

This interview is part of the The Paypers` Money Movement in 2026: Trends in AI, Payments & Regulation Newsletter, a source of expert insights on the forces reshaping fintech, payments, and banking, covering fraud and financial crime, AI in fraud prevention and risk intelligence, real-time and cross-border payments, European payments sovereignty and the future of instant rails, stablecoins, agentic commerce, compliance and the evolving regulatory landscape, payments fragmentation driven by geopolitics and regulation, infrastructure bottlenecks in banking modernisation, the shift from generic scale to verticalised, value-added payment models, and digital wallets changing consumer payment behaviour – delivering a clear, data-backed view of what will shape strategy and innovation in 2026 and beyond.

Explore the other contributions in this Money Movement in 2026: Trends in AI, Payments & Regulation Newsletter series for more expert insights:

• Bizum - European instant payments: sovereignty and cross-border interoperability
• Oliver Wyman - Navigating the future: how agentic commerce is redefining payments
• Triple-A - Stablecoins, the once-in-a-lifetime shift in payments
• UniCredit - Navigating regulatory change: compliance and the future of digital payments
• Unlimit - Why the future of digital wallets depends on interoperability at scale
• ACI Worldwide - Global orchestration for a real‑time, APM‑driven payments era
• The Paypers - 2026 fraud forecast: AI, deepfakes, and rising cybercrime risks

About the author

Albion Murati is a Partner at McKinsey & Company and part of McKinsey’s Banking Practice leadership team. He leads McKinsey’s Payments Practice in Europe. Albion works with banks, financial technology providers, payment specialists and investors to transform their businesses. His experience covers strategy, M&A and company-wide transformations across commercial, productivity and Tech/AI levels. Albion has also been part of developing and launching a number new digital banking and payment products across the world.

 

 

About the company

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