Five Key Themes Driving Payments Innovation in 2026 – Alan Koenigsberg  [Season 3 | Episode #06]

Intro & Outro 00:00:00 Hello. Welcome to P.I.T. Exchange, a podcast by Currency Research. Join us as we discuss the latest in payments innovation and technology with the industry’s most innovative thought leaders. Today’s payments are changing and moving around the world faster than ever before, and Pit Exchange gives you the knowledge and insights to keep up. Sit back and relax as we join currency research, exchanging ideas with today’s special guest.

Jordan Taylor 00:00:33 Welcome to the P.I.T. Exchange Podcast by Currency Research, where we talk payments, innovation and technology. My name is Jordan Taylor and I’ll be your host for this episode. And today I am delighted to be joined by Alan Konigsberg. And actually, this is the first part of what is going to be a two part episode. We had just too much to talk about with with Alan. For those of you who don’t know, Alan, Alan is a veteran of more than three decades, holding senior global leadership roles at such well-known institutions as visa, American Express, JP Morgan, and Bank of America. And Alan has now formed his own global advisory, Konigsberg Insights, that we’re delighted to have Alan with us today to discuss some of the major trends, topics and themes that are shaping the world of payments in 2026.

Jordan Taylor 00:01:31 Alan, good to have you around. How are you?

Alan Koenigsberg 00:01:33 Good to be here, Jordan. Thank you for inviting me.

Jordan Taylor 00:01:36 It’s always our pleasure. Always our pleasure. I know you’re a very busy man, and, traveling as much as ever, so we’re glad we could. We could catch up with you for a little bit here this afternoon. what you got on your mind?

Alan Koenigsberg 00:01:50 I would love to tell you, Jordan. Thank you for the invite. I’d love to tell you that there’s five new things going on and that are so gigantic. But there aren’t. There are forces out there that are conflating to create change. Sort of. All at once. I learned about the ten forces or reshaping the business, and we’ll talk about some of them today. But I think it really comes down to sort of five key themes. And one is removing friction from the system for designing for what the real challenges are that are customer focused versus patching and sort of renovating versus innovating. The second is really around business and consumer trust of these systems themselves, that privacy and security and compliance are fundamental to their success in nearly every market that we’re in.

Alan Koenigsberg 00:02:46 Or I was in Visa or J.P. Morgan. there are payment changes and infrastructure changes going on one domestically and two from a cross-border perspective. cross borders. Never seen so much change. providing inclusion activities for all versus just some, commercial bankers managing their relationships with middle market companies or tomorrow’s large enterprises. Small to medium sized enterprises as well as consumers, only had very few choices in the past. Even today, many markets had wires or other very dangerous to choose from. But now we’ve got retailers, we’ve got all kinds of capabilities all over the world that demand an integrated real time or near real time experience. I think the third theme is really, really important, which is execution. It’s getting this done, but you have to have flexible goals, long term thinking in order to get there. You can’t boil the ocean all at once. I mean, I think that a lot of the treasurers I talked to are confronted with all of these projects happening at the same time. Nobody’s got this bandwidth to to execute.

Alan Koenigsberg 00:04:03 Not to mention AI. Those things go around, and those rocks are sort of the bedrock of many businesses for their customers. The fourth is collaboration. And by the way, this is no earthquake here. You know, it’s collaboration really wins the day. That acknowledging that one company or not one organization can do this by themselves. But you need standards. You need partnerships. I think this is something that you guys do very well at CR, right? You bring people together, you talk, you discuss, and you know what change comes from that. Are central bankers go back to their their countries and they begin to have a conversation. And then they have a conversation with each other. And potentially we see what we have in Ghana, which is a pan regional kind of partnership. that started very, very humbly with mobile payments and now sort of expanded into this massive, massive behemoth of cross-border solution, including QR. And then last I would mention, inclusion that’s inclusion, diversity, etc. has been announced with cocktail conversation in the past.

Alan Koenigsberg 00:05:14 You know, I mean, we want to include everyone but this we needed this time. I think consumers need at this time or they’re going to move on. It’s a force for revenue. It’s a force for economic strength. And if we’re not building these to include all just some, we’re not going to really make it to where we need to go because it’s going to happen anyway, especially with non banks coming into the market and providing and putting services that banks traditionally provided. I think it’s really important to think about it. So you know they could say, well I’m not going to provide it or I don’t have the time or the bandwidth, but they have to because they’re serving not only their constituency, they’re serving new fintechs that could probably do it better and faster. They should be partnering with them, not just optional having discussions. And that, to me, makes up the five sort of themes that took me down this road to really think through. What are those top ten forces? And frankly, they’re big.

Alan Koenigsberg 00:06:11 Each one of them is big. And if you think about my conversation with Sean last year or the year before. Again, no big shakes on, you know, the topics changing, but boy, it’s almost breathtaking to see how much change has happened since even last year. Yeah. This year.

Jordan Taylor 00:06:29 Yeah, I think it’s I think it’s really timely actually, that we are having this conversation today. And first of all, I want to say that, you know, looking at your, you know, these five bedrock principles, they, they all to my mind, they all work together, right? None of them are necessarily in isolation. They all Inform each other to sort of, you know, create one, one whole. and so looking at something like execution and collaboration and you’re talking about the cross-border space. Just yesterday, the chair of the Financial Stability Board, Andrew Bailey. had a had a statement about, you know, work that needs to be done. And one of the things that he emphasized was, you know, public private cooperation.

Jordan Taylor 00:07:24 And I know it gets said a lot, but, you know, and he laid out a, not quite a roadmap, but, but some, some, some designs about what that should look like. And so I think that it’s just really indicative of what, what you’re talking about, where the industry knows they need to go to get to these places. So what what does that actual that, that, that public private partnership. What does that look like in your mind to, to advance something like cross-border payments? Now that we’re more than five, you know, five plus years into the G20 roadmap.

Alan Koenigsberg 00:08:02 I think the G20 roadmap was excellent, providing a framework by which the the the businesses can move forward. I think you suggesting your question, who should lead it? Who should follow? I think it depends on each market to figure that out. I think that the voice of the customer has to be at the centre of these conversations. You’ve heard this in the past, you know, oh, Lord, we’re not going to provide this or we’re not going to talk to the other real time system, which was sort of comical in the past.

Alan Koenigsberg 00:08:34 that doesn’t serve anybody other than like an internal focus. And I think to be relevant, you have to include that constituency, which as consumers or small business or large corporates, etc., that has to be there. Who leads it, I would say. Sort of. Who cares? As long as it’s led. And as long as the change has happened accordingly. It doesn’t matter to me or I don’t think it doesn’t matter any of us. as long as process is followed. It took us, probably. I rolled out J.P. Morgan in 2005, I believe was the first bank to actually roll out a first step in the payment out of Europe. It’s still rolling out, you know, sort of 20 years later. so that was continuing. Now you could say, well, it’s so sophisticated. Now we have a domestic payment system across the eurozone. Yep. We do. does it have the kind of volumes that have the US ACH and other markets have? It’ll get it’ll get there. Does it have an opex that rivals other competitive types of products? It does.

Alan Koenigsberg 00:09:38 So I think those things all in take time. But it’s public private to get there. Some markets were really public at the beginning. And then they realized that. Wait a minute. We’ve got to stop. Turn around and ask the customer what they think. I would use the example, and I don’t get too provocative on you, but use the example of, PayPal. Some years ago, it took the US banks 18 years to respond to that. 18 years. And so I don’t think 18 years is going to be acceptable. Going forward, I don’t think in the world of academic AI and so much change and so much velocity and shift is shifting so quickly that even that it’s going to allow six months, to like, you know, ponder the universe and come up with solutions. but I think it’s really important to understand that our customers are banks. Customers are really struggling to understand their own relevance with their own customers. Everyone’s thinking about AI for different reasons. Some risk management Operations, retail experiences, and it’s just moving so quickly.

Alan Koenigsberg 00:10:51 And consumers like never before are empowered to actually take control of their financial wealth and take control of of how they navigate banking. And they can make choices they never have before, including doing business with non banks, including programming, payments and all the rest of it. So I think that, I don’t know what you think about it, but I think there’s a lot of change and it’s excellent that it’s happening now because it’s right on time. It’s right on message with with the changes there.

Jordan Taylor 00:11:26 And certainly well, I would say first that nobody is really interested in what I think about about anything. That’s why we’re talking to you. Well, I appreciate I appreciate that, to your point about how, how quickly and how new this this is going obviously, 18 years is not going to be acceptable, any longer. I would say that that dovetails nicely into sort of the first major, trend that you recognize or theme for, for 2026 and stablecoins, the maturation of stablecoins and how, how quickly they have gone from being talked about in a certain type of fashion, about a speculative asset to more mainstream use.

Jordan Taylor 00:12:12 Now, I think there is a lot to unpack about just how mainstream they have gone or become, how widespread they are being used for actual payments. their total share of, of, you know, global, money movement. But we can get into that now or another time. But but the fact is that they have certainly matured since, you know, even this time last year.

Alan Koenigsberg 00:12:43 Well, we spent a lot of time talking about central bank digital currencies, and the president of the US sort of put a halt to that and sort of stumbled the efforts of many central banks and sort of exploring that because the US was not going to be involved. But the whole idea of programmable money is something that isn’t new. We’ve been using it as what? Debit cards or excuse me, prepaid cards and benefits, etc.. When I was in the UK at JPM, you know, we were managing a lot of the public services accounts for the government and we had programmable money back then. It was mundane, it was pretty archaic, but it’s something that the customer wanted for theirs in terms of giving them money to be able to pay their gas bill, but not having it passed, pay anything else.

Alan Koenigsberg 00:13:37 That’s a really key opportunity we have in the US with, with food stamp programs, etc. where you could buy certain things and not others. HSA accounts, health care, but not beer and other things. So. That’s money. Tokenized deposits are extremely important from a commercial perspective. It doesn’t destabilize the regulated deposit basin markets. and I sort of feel like a little bit redeemed short one is because when I went to visa, I was asked by the leadership there to develop the first non card based high value payment system that they had, and B2B direct was born out of that. What is B2B and what is B2B connect? Excuse me. I would say these are direct at the same time. B2B connect is essentially without calling it so at the beginning. A an application that does just this. Basically, digitize this money provides into the payments and is essentially a stablecoin application. And we’ve had it now live for five years or more. And I’m very proud of those efforts. And there’s hundreds of banks that use P2P connect and more that use visa.

Alan Koenigsberg 00:15:10 Correct. I think that’s fantastic that these companies are leveraging it because they didn’t have choice before. And so we have banks that want to have control over or manage the whole client experience, end to end. No negative comments on a chain that is provided in the past, with money moving from institution to institution along a line with many and other types of deductions along the way, you could say technology has surpassed that now. You can remove the friction points in between. Or the intermediaries in between them, so that an institution could actually have a relationship with their customer, with a consumer or business, and they can get their payment point to point that way. That’s what being interconnected does, and that’s what stablecoins do. And there’s a whole host of applications and use cases that it’ll provide. And by the way, it’s here. It’s producing billions if not more of volume. But from a B2B perspective, commercial bank perspective 50. So it’s here to stay in. Essentially it’s digitizing the experience of moving money in in that fiat currency.

Jordan Taylor 00:16:24 What do you see as being the the largest use case for individuals?

Alan Koenigsberg 00:16:34 I think cross-border is enormous. Opportunity for stablecoins a good continues to be the use case that gets touted, as a huge problem solver and opportunity.

Jordan Taylor 00:16:47 I would, I don’t disagree. I was as you know, the the central bank payments conference that we had this year, we have implemented a research component where we are giving some, some researchers from academia and central banks and private sector to present on some papers that they’ve written. and one of the papers that that really stood out to, to all involved was, looking at stablecoins, stablecoin, digital dollar wallet, and one of the really fascinating. Bit about that, that paper was the way that stablecoins are at least this particular wallet was being used for micropayments. Yeah, right. And so we often talk and I think I think you know, it’s often talked about a settlement asset. You know, high value payments and things like that between institutions. But this idea of, you know, $2 micropayments being sent across border or cross borders, is not the sexy stablecoin, use case that we often hear about, but I think one that is certainly more impactful to the average person.

Jordan Taylor 00:18:09 And if we’re talking about things like financial inclusion, however, you want to define inclusion that that there’s real meaning and value in, in two bucks.

Alan Koenigsberg 00:18:21 I think the fact that we can deliver a value payment of $2 at an operating cost is well below that is sexy. you know that potential institutions that can have actually control over that process end to end. I can deliver that payment in its fiat currency in a wallet. is very impactful, because it’s being delivered today by non banks. And so it’s not like banks need to stay competitive. It’s like innovating and restoring, capabilities and infrastructure that continue to pace with the markets. You can’t just sit in a market and say I’m in a bubble and I can do what I wish. it’s just not it doesn’t work anymore.

Jordan Taylor 00:19:10 if not now, do you foresee any, any risk in a, in a certain level of fragmentation between just a proliferation of, of stablecoins? I mean, I don’t know how many there are currently. I mean, but is is that something that if concern is not the right word, is that is that something that should be kept an eye on and or what? What do we do about it?

Alan Koenigsberg 00:19:35 Something about that exact topic last year.

Alan Koenigsberg 00:19:39 and yeah, I think I have concerns about it from a risk perspective. I think you saw some you also have a major generational shift happening at the same time, right? So you have the Gen X kids of us Gen X kids, handing the keys to Y, Z and alphas. And I mentioned that only because a lot of them don’t know a world without some of the stuff without crypto. Now, it took us a while to get our head around that crypto technology and proprietary crypto, and then moving on to central bank and now stablecoins. But yeah, there’s competition in the market for leveraging volume. Every stablecoin has to be backed up in fiat currency. Question is how it’s being backed up. What rules and what, audit requirements are behind it. If there’s a failure, if there’s an event in the system. Jordan, I think that’s an important marker to understand. As Warren Buffett put it, you know who’s wearing a bathing suit when the tide goes out? it’s important to, you know, really have belt and suspenders in terms of understanding what your processes are.

Alan Koenigsberg 00:20:53 And I’ll leave that to the markets for themselves. But it was something I noted last year, and it still concerns me. But the process itself, the idea of using stablecoins as a digital form, a digital record on a public or private, you know, blockchain is impactful. not every consumer or business needs to understand it, but the banks can operate that at a cost that’s much lower than they have today.

Jordan Taylor 00:21:20 Alan, I was I read something recently, just the other day that I think it was recent research from a variety of sources actually, pointing to not Bitcoin, which was a huge concern a couple of years ago, being used for illicit purposes. But actually stablecoins being being the instrument used in in sanctioned circumvention. What you know, one is that a surprise to where do we go from there.

Alan Koenigsberg 00:21:58 KYC and AML processes is probably the most duplicated, complicated and expensive processes banks have because if they don’t do it right themselves. They’re going to get fined and their business is going to be at risk.

Alan Koenigsberg 00:22:13 I think the next horizon for KYC and identifying, you know, the evildoers, as they say, is some form of ubiquity around managing risk and, and audit and quite know your customer. That could be shared across institutions so that they have a trusted network, a trusted space. Be able to look up, validate and make sure to your point that their systems aren’t being used against them, that there aren’t illicit things going on that break the rules of a financial institution or break the law. I think it’s as simple as that. There are a host of different companies that have come to the market. Some of them sort of legacy firms, some of them born in, digital currencies of crypto that are extremely competitive and offer services. Even a good friend of mine, a JP. She left and founded this organization that is getting traction in the market. And you had to have one central banker or a couple of central bankers really believe, and, you know, you can catch fire. Look. I really do believe that this is probably the biggest underlying concern of financial institutions.

Alan Koenigsberg 00:23:35 Can they keep up? I know I’ve been to connect and other types of, you know, payment systems I’ve worked on in the past. It has been the one sort of process that has been the most expensive to slow us down, and not because we don’t have the desire to follow the law. It’s just that it’s so cumbersome. And when something gets flagged, it could take days if not weeks to clear them. And, countries that produce lists of banned markets, banned cars, banned boats, etc., they in the past haven’t thought about it from a strategic perspective. Bankers are beginning to think about it that way. And that goes back to partnerships. How can you have a third party or an enterprise out there that’s providing that kind of consistent review, and we’ve got to make it time for that?

Jordan Taylor 00:24:27 Yeah. So Where is that that that balance between compliance and rigorous standards. You know how how how does a financial institution and regulatory authorities, you know, how do they find that sweet spot that that does work, that isn’t overly cumbersome, that isn’t overly costly?

Alan Koenigsberg 00:24:51 Let me give you maybe a little bit of history on it.

Alan Koenigsberg 00:24:54 Okay. So in the US with the US, ACH the KYC is done at the account level so that every domestic payments, that every customer is vetted that way. So their DDA, if you will, it’s you know, Jordan walks into the bank and opens up a current account and a savings account, and your KYC is done. They’re not in every transaction. And of course through a machine learning pattern management AI now. And they can see if you’re behaving out of pattern. Right. So if you make five payments a month and then all of a sudden you’re making 25 payments a month valued at $2 million. Somebody is going to begin to ask questions. That’s where the technology can actually support, taking that to the next level. That’s not new. The networks Mastercard, visa have been in the have been in the business of examining transactions for over 35 years. They call it AI now. But essentially looking at this from the perspective of compliance and following the law. this is that isn’t anything that that the networks or the banks haven’t done before, but it’s being done faster and it’s being done on a lesser expense.

Alan Koenigsberg 00:26:07 Now you’re at the horizon to say, okay, how do we do it consistently cross-border. How do we share information? and how do we homogenize the way these reviews are done? So whether it’s at the account level or it’s at the transaction level, which is probably the most painful, you know, how does that actually go? Go. go.

Jordan Taylor 4 00:26:28 Alan, I don’t know about you, but I think that makes a nice little place to wrap up the first half of our conversation. I encourage everyone to be on the lookout for the second installment of this discussion, where we will pick things back up and explore more of the major trends and topics and themes shaping the world of payments or currency research. My name is Jordan Taylor. I want to thank Alan Koenigsberg for being our guest and to all of you, thank you for listening. Please like, subscribe, download, do all the things you do and we hope you enjoyed. Catch us next time. Thank you very much.

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