GenAI Makes the News for All the Wrong Reasons as Hype Succumbs to Reality
Digital wallets are card companies worst nightmare
Artwork of the day: A Sunday on La Grande Jatte, Georges Seurat, 1884-1886
In his best-known and largest painting, Georges Seurat depicted people relaxing in a suburban park on an island in the Seine River called La Grande Jatte. The artist worked on the painting in several campaigns, beginning in 1884 with a layer of small horizontal brushstrokes of complementary colors. He later added small dots, also in complementary colors, that appear as solid and luminous forms when seen from a distance.
Seurat's use of this highly systematic and "scientific" technique, subsequently called Pointillism, distinguished his art from the more intuitive approach to painting used by the Impressionists. Although Seurat embraced the subject matter of modern life preferred by artists such as Claude Monet and Pierre-Auguste Renoir, he went beyond their concern for capturing the accidental and instantaneous qualities of light in nature.
Why today’s stories matter:
Apologies for the delay! This was ready to go on Sunday night but I forgot to click send! What can I say?
Seurat’s painting captured the “accidental and instantaneous” qualities of light, and it seems that capital market corrections in part generated by AI hype are similarly “accidental and instantaneous.”
We’ve been fed a lot of hype about AI, and it seems that the hype, like an overinflated balloon, has popped. Is anyone really surprised?
I don’t think so, and the new MIT report boldly proclaims that companies are “not rushing into AI.” If there were ever a canary in the coal mine for AI, this statement would be it.
This doesn’t mean that GenAI will fail or not be transformative; it will take longer than advertised.
Banks are diving into GenAI with high expectations. The problem is that some don’t seem to realize that once everyone has GenAI working for them, it will no longer be a compelling differentiator of service.
So banks may get a GenAI lift this year, but a manager who thinks their GenAI lead will last until next is fooling themselves as all banks are getting in the game.
Asia’s wealth management industry believes GenAI is the key to its future. With a doubling of AUM predicted in the next three years, GenAI is seen as crucial.
Is this hype or reality? It's probably a bit of both, Asia’s wealth is rising fast enough that even without GenAI, the increase would be significant.
Digital Wallets are card companies' worst nightmare come true. How long can they hold out?
Finally, a wonderful start-of-the-week read from MIT showed how CIOs think about GenAI. This is a practical read that defies hype.
Digital Wallets: The New Nightmares Keeping Card Companies Awake
Digital wallets are taking over payments, giving card companies nightmares, and now it's getting even worse as they are coming for card companies' cross-border business, too.
You could credit digital wallet growth to convenience and you'd be mostly right.
The problem with that assessment is that you'd be missing out on digital wallets' biggest feature, bringing economic growth through financial inclusion and expanding MSME business.
If you ask yourself why developing nations are pushing digital wallets and CBDC, you have to recognize that governments see them as essential tools for growth.
Many readers using Google or Apple Pay don't get this because these wallets are no more than a credit card on your phone with intentionally limited functionality.
Long-term digital wallets are coming for cards. As soon as people experience a real digital wallet with instant payment and zero fees, they'll never want to go back.
Digital wallets deliver growth that cards never can.
👉TAKEAWAYS: Top trends
🔹 The digital payment evolution: the rise of the cashless economy:
Digital wallets have been the fastest growing payment method, driven by policy support and consumer preference. The Asia Pacific region accounted for nearly two-thirds of the global
spending at a combined US$9.8 trillion, while boasting the highest digital wallet penetration rates among all regions.
🔹 Private and public sector collaboration is key to greater payment interoperability:
Payment interoperability has become a dominant theme in both private and public-sector efforts to boost regional e-wallet adoption. E-wallet players have begun to develop cross-border
payment solutions to allow consumers to use their home e-wallet app while travelling abroad.
🔹 Digital wallets go beyond payments and enable omnichannel commerce:
To adapt to the trend of omnichannel commerce post-pandemic, e-wallets and banking apps are rapidly evolving into super apps by assembling many third-party services through mini apps.
🔹 Fintech eyes inclusive and sustainable growth:
Payments have a proven record of driving financial inclusion, and MSME growth, which makes them potent tools for economic growth.
Tell me why I'm wrong for picking on Google and Apple Pay wallets!
Articles that caught my eye and your start of the week read:
MUST READ ON GENAI: This is a great long-form read on GenAI that you shouldn’t miss!
While GenAI has certainly been overhyped, the reality is that it is coming for every company. Saying no to GenAI isn't an option.
That's why, once again, GenAI makes this week’s reading list.
HSBC’s PayMe goes global with access to 34 million merchants in 46 markets on UnionPay: HERE This matters because its not Visa or Mastercard!
Thai digital money giveaway highlights programmable money challenges: HERE
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