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ARM, CDO, CDO2, CDS, MBS, Credit card, ATM, compelling mobile wallets - these are few bank-led innovations I can readily think of. Maybe they are not positioned as disruptors of the status quo or whatever but, IMO, going by their track record of generating greater revenues and profits, they are the most superior form of innovation. 

In which category - SME, Me2, HiPPO - would you place these innovations? Or, does it really matter?

Let me repeat my comment from a previous post titled Card fraud rises across Europe - ECB:  

Does anyone how much extra revenues merchants gained by not being overzealous about security, causing too much friction and suffering from shopping cart abandonment?

Mitigating Fraud Does Not Pay The Bills

Contactless cards and Apple Pay are both based on banking rails. They seek to drive a switch from cash payments, on which a bank earns no interchange revenues, to card payments, on which a bank earns interchange revenues. Cards will be around whether Apple Pay is around or not. But Apple Pay will become pointless if cards are not around. To me, this sounds like the perfect example of a principle-reseller arrangement, with the bank being the principle and Apple Pay, the reseller. Why should banks be worried with this change? The way I see it, banks should be very pleased with it.

Going by my frequent tête-à-têtes with drivers of Ola, Uber's competitor that I use regularly, these loans are the glue that holds this "asset light" model together. Over the past year, Ola has introduced several measures to curtail the initial "honeymoon" phase of drivers e.g. cancel fixed payout, reduce per km rates, adopt a "zero tolerance" policy towards errant drivers, etc. But, drivers tell me that because they have a loan to repay, they have no choice but to continue to operate on the platform.

At least this is one banking IT fiasco that won't be blamed on legacy.

According to this BBC article from BBC, cash is growing, not dying: 

1. In the seven countries ... — Australia, Austria, Canada, France, Germany, the Netherlands and the United States, 46-82% of all transactions in 2012 were conducted using cash.
2. In the United States, cash in circulation grew 42% between 2007 and 2012, and the amount of American money floating around in bills and coins is expected to grow by about 5% each year. The average growth globally is 7% per year.
3. ...card payments in the Netherlands have been growing by about 8% annually over the past few years. And yet, cash is still king. In 2012, there were 2.7 billion card payments, but an estimated 3.5 to four billion payments were made with cash. 

So much for the death of cash - it's not only not dying but it's actually growing. All over the world. Even in Sweden and Denmark - "leaders of cashless crusade" as BBC calls them.

Whaaat? During the implementation of FPS at a Top 3 UK bank, the agenda of one meeting was "Death of BACS". The consensus prediction was that FPS would kill BACS three years after its go live in 2008. So many years later, BACS breaks transaction volume records. Hmmm, this just goes to show that these "A will kill B" and "C will disrupt D" kind of dire predictions rarely come true in financial services.

If “It's undeniable that banks have a certain amount of brand capital”, how does it matter if “that's accidental”? While they may keep dropping the toast, maybe in the decades of their existence, banks have mastered the art of dropping it in such a way that it never falls on the buttered side? Which can’t be said for many seasonal fads / “brand brands” despite their “intentional, cultivated” approach towards brand building??

I recently tweeted "I can't understand why so many people pay by debit cards when credit cards offer many more benefits e.g. rewards, deferred payment." Your post answers my question: Maybe because they began their payment journey with debit cards. I used to think it was due to the aforementioned benefits that I’m a credit card freak but, after reading your post, I'm wondering if it was really because I began my (noncash) payment journey with credit card. (When I got my first credit card in c. 1989, there were no ATMs or debit cards in India.)

I agree that habits won’t change easily - voluntarily. But they can be changed by regulation and compelling new offerings. Ever since 3DS / 2FA was mandated for online credit payments in India, I found too much friction in the process and, in a change of habit, moved from card to COD. And when a compelling new product like HDFC Bank’s PayZapp came along, in another change of habit, I moved to mobile wallet.

PS: Since PayZapp uses my existing credit card as the funding source, it could be argued that my move to mobile wallet was merely a return to my credit card habit, just via a different form factor.

"Unite is urging customers to pay tips in cash." Yet another case of high cash-out cost of card payments driving the move to cash, taxi drivers being the first one I'd highlighted in Cash in Hand Is Worth More Than Card In Bush.