Käärmann: Future payment processing fees will drop far below 49 bps
Kristo Käärmann · a16z Podcast | The Future of Money and Monetization · Jan 2, 2019 · at 16:23
Kristo Käärmann, co-founder of Wise (TransferWise), argues that the underlying technical execution of digital payments is too cheap to justify high interchange rates in the long run.
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“You can't really imagine the future of payments costing even 49 basis points. It doesn't, just doesn't make sense. You know exactly how, if you know how payments, card payments work, you know, electrons go from the terminal or one web browser through the gateway to the issuing bank, money gets deducted, electrons go back, and it's done. Doesn't cost 45, 49 basis points. Definitely doesn't. So, so, you can't imagine the future where Card payments are gonna, ah, cost as much as they do.”
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