Musk, Trump and What’s Next in Payments

The first months of 2025 have passed so quickly that there is barely time to reflect.  

First there would be painful tariffs and retaliatory tariffs, now Canada and Mexico have ‘caved’, but really they agreed to do things that they are already doing. By the time you read this the story will have progressed so far that the news in the links above may as well have been written in hieroglyphics on stone tablets, and that’s just one plot thread. There is also AI, Elon Musk, a rapidly evolving regulatory framework, companies rising and falling and new technology either changing the game or fizzling out. 

In this environment, it can be hard to make predictions about where even a small part of the world, let alone payments technology that affects the global agenda, is headed. Yet, we’ve got to have at least some idea of what the future might hold since we need to orientate what we do today to tomorrow’s environment. Here, I’m going to attempt to cut through the noise. I say this because any attempt at futurism is always bound to fail, but we can at least look at the broad trends existing today and the possibilities for where we might go from here. 

Tearing up Regulations? 

Talking to payments professionals about regulation is like talking to fish about water: it’s always there, it always will be there and talking about a time when it will just disappear seems ludicrous. If anything, we have only seen the quantity and quality of regulation increase: DORA was introduced this year and PSD3 will soon be released to improve upon the already transformative Payment Services Directive. 

However, we might be about to see the first real instance of the once-inevitable march of regulation start to run in reverse. The US government’s willingness to use tariffs to enforce its will across the world and the Starmer government’s attempt to walk the line between the US and EU might result in the UK government being willing to loosen up regulations. Right now, Trump seems focussed on the things that interest him at any given moment, like why Europeans don’t drive US-made cars, but soon his government could turn its sights on more material concerns, like loosening or straight-up abolishing regulations to help US companies compete. 

Consider this scenario: Elon Musk launches X as an ‘everything app’ in the manner of China’s WeChat, leveraging a partnership with Visa to create a payments ecosystem on the app. Unfortunately, it doesn’t comply with EU and UK regulations. Is Musk going to shrug his shoulders and accept that 744 million people won’t be able to access his app? Or is he more likely to use his outsized influence in the US government to put pressure on Europe to change its regulations? When this happens, will existing companies stick to previous regulations out of concern for their customers or will they ditch years of regulation to cut costs? 

Open Banking will grow – just don’t call it ‘Open Banking’ 

This year is ‘set to be a pivotal one for Open Banking’, according to Open Banking Limited. 11 million people use Open Banking each month in the UK, and 11.5 million payments are processed through it each month. PSD3 will only improve the technology and regulations behind Open Banking, hopefully leading to more uptake. We could be looking at a doubling of that eleven million figure, or perhaps more. 

But whatever happens in the Open Banking world, it won’t be called ‘Open Banking’. We have seen from our own research (the results of which will be published shortly) that the UK public, the end users of Open Banking, are quite ambivalent about Open Banking as a concept: only 5% say that being unable to use Open Banking payments negatively affects them while buying from UK businesses. We should be seeing a much higher number if around 15% of the country is currently using Open Banking. 

What explains the gap between enthusiasm and use? It’s simple: people are using Open Banking without knowing it – if these figures are right then it’s almost exactly two thirds of Open Banking users. This means that Open Banking needs to remain an insiders-only term, something that we can use within the payments industry without making it public facing.  

Will Mobile Wallets Keep Their Momentum? 

One in five Britons regularly use their smartphone to pay for items in person, and 38% of online transactions were made with a mobile wallet. The industry consensus is that this number will grow, but let’s examine the assumptions underpinning this. 

Firstly, 94% of all Britons own a smartphone. Many would point out that, mostly correctly, that this means that there is a large potential market for mobile wallet apps – it has ‘space’ to more than triple in size. However, we’ve got to remember that mobile wallets have been around for a decade at this point, so it’s unlikely that the 74% of UK residents who own a smartphone but don’t use mobile payment apps haven’t heard of them. The likely reason that they’re not using them is security: it’s one thing to have access to your money on a plastic chip in your wallet, but quite another thing to have it on a device that’s always connected to the internet. Digital wallet crime is rare, and very difficult to carry out without the wallet owner’s permission, but people’s attitudes to their money’s safety is rarely fact-based and many people err on the side of caution. 

What may move the needle on mobile wallet adoption is introducing more features to the apps than just payments. Whether this means a fully-featured super app (something that has been notoriously difficult to get off the ground outside of Asia) or something more minimalist, but still valuable such as airline-style points or discounts. 

Account to Account takes off 

Account to Account, or A2A, is one of the places where Open Banking technology can find its way into the financial mainstream. Although they don’t exclusively use Open Banking, A2A payments offer one of the key parts of Open Banking – direct push and pull payments from one account to another that don’t involve existing card systems like Visa or Mastercard. 

There are currently a host of ways to make real-time payments, such as the transfer functionality in banking apps, but these are optimised for retail or online payments. Consumers don’t want to enter a shop’s account number and sort code when they’re making payments, so API hooks can be used to connect a customer’s account directly to the merchants. 

How do we help this take off? One of the few payments innovations that has really made a mark in recent years has been tap to pay, and it’s not hard to see why: everything you need to know is right there in the name and there’s no need for additional software or hardware to make it work. A2A may not be as simple – setting up a payment, particularly a subscription, could require two-factor identification or some other form of authentication, and if it requires apps to be downloaded then there will be even higher barrier for entry. 

This takes us back to Elon Musk and X – since X Money Account is being developed in a US context one of its key features is being able to send A2A payments, something that has always been difficult in the US, hence why there is an ecosystem of apps like Venmo and CashApp to do things that Europeans take for granted. He is partnering with Visa to deliver key functionality, and given that company’s reach and importance in the overall payments ecosystem there is every reason to believe that these services will be available in Europe. 

Striking the balance in the flux 

There is a lot going on right now, and any of it could have far-reaching implications, even on the payments industry. It’s the wrong move to just dismiss the entire project of trying to predict what next however, because some things are always going to be the same.  

Customers want functionality to genuinely improve their lives without adding complexity; companies want to make money, and that unfortunately often translates to avoiding regulations that add extra cost; regulators want to protect consumers and don’t mind adding complexity or cost to do so.  

There’s going to be some give and take between all of these actors, and when you add in new technology and political developments you’ll begin to see what’s possible.