Payments Industry Shifts Focus from Tech to Business Value

The payments industry often fixates on new technology, but James Wester, director of cryptocurrency and co-head of payments at Javelin Strategy & Research, argues the real focus should be on the business models that emerge around these innovations.

Speaking at the Western States Acquirers Association conference, Wester outlined a familiar pattern: new technology starts as a novelty, gains traction with early adopters, becomes widespread, and eventually turns into a standard feature.

From Novelty to Necessity

Wester notes that while technologies like AI, stablecoins, and real-time payment rails initially grab attention, they often become ordinary tools. “Every successful technology goes through a very familiar pattern,” he said. “It begins with something new, it requires explanation. It becomes a slight advantage for some companies. [To reach] network effects… requires wide adoption before it really succeeds. Eventually, it’s something that every provider has to include.”

The economic climate adds complexity. While consumer spending remains strong in dollar terms, real spending has stagnated due to inflation, and businesses face rising costs. In this environment, minor cost savings are unlikely to sway merchants when choosing a payment provider.

Business Value Over Tech Hype

Wester emphasizes that the true value of technology lies in solving real business problems. He advises payments companies to ask critical questions: What problem does the technology solve? Whose behavior needs to change? And crucially, who will pay for it? Without clear answers, a technology-focused pitch falls short.

For instance, a merchant struggling with lost sales, slow settlement, or chargebacks may find value in a technology that directly addresses these issues. Wester suggests that acquirers and processors should focus on identifying such problems and then work backward to find the right tools, rather than building strategies around technology names.

Vertical expertise, he adds, is harder for competitors to replicate than access to any given technology. “Don’t build where there aren’t economics,” Wester advises. “You don’t get paid to be innovative. That’s not what companies are paying you for.”

Technology’s Role in Solving Merchant Problems

A compelling presentation and product might attract attention, but without answering key questions about problem-solving and cost, a business lacks substance.