New Mobile Payment Firms Will Not Displace Banks Easily

Some genuinely believe that banks are in danger of serious displacement by mobile payment and mobile banking competitors. It will be harder than many believe. Banking executives will respond; many already are doing so. 


Beyond that, it is difficult to dislodge "trusted providers" in just about any business you can think of. Observers have been predicting the imminent demise of traditional TV distributors or creators for a decade or more. It has failed to materialize, if the measurement is revenue, rather than viewing hours.


Many veterans of the U.S. competitive local exchange carrier business will agree that upending the leading suppliers in the telecom business has proven to be devilishly hard. Some would argue it has proven difficult for all contenders except the cable companies, at least in the consumer market. 


There arguably has been more success in the business customer segments. 


In the emerging mobile payments and mobile wallet businesses, even players as large as Google and Isis (AT&T, Verizon Wireless and T-Mobile USA) are working with banks, rather than trying to displace them. 


PayPal and Square are more directly threats to banks in the ecosystem, but only to a certain extent. 

Banks will be harder to dislodge than many believe.