Book review: ‘The Pay Off’ by Natasha de Terán and Gottfried Leibbrandt
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How changing the way we pay changes everything.
Put at its simplest, a payment is a bilateral transaction in which money moves between parties in exchange for goods or services. The ‘payment’ has been at the heart of how societies work since our tribal origins and has been essential to economies for more than seven millennia, which is roughly how long we’ve been using metal coins to represent fiscal value. The idea of physical money is so fundamental to the way humans interact that authors of ‘The Pay Off’ (Elliott & Thompson, £16.99, ISBN 9781783965847), Natasha de Terán and Gottfried Leibbrandt, argue that it is part of a triumvirate of key abstractions that enable societies to function (the other two being religion and writing).
And while over time we’ve devised ever more sophisticated ways of moving money around, the most explosive developments have arrived with the digital revolution, our current era in which innovation is in the hands of the ‘smartest brains’ whose job is to make paying for things easier. Rapid changes in technology mean that we can spend and borrow in ways that a generation ago we could hardly have dreamed of. We can also become disenfranchised, as the digitally disadvantaged get pushed to the margins of a financial system in which money can be neither seen nor touched.
But we know all that, and our authors know we do, which is why, having established their framework, they move swiftly onto examining what it means to be part of the payment network in the digital age.
For sure, the ease with which we perform transactions today is something that most of us can cheerfully take for granted, but as technology dismantles payment barriers and governments try to erect them, there will be those of us that want to know what’s really going on. While we are comfortable with the idea that technology is hugely influencing how we are paying, what might sit a little less easily with us is the not-so-obvious background process of ‘paying to pay’, how much and why it matters.
Leibbrandt and de Terán delve into this and other questions, exploring the notion that payments matter as much as money itself, untangling who owns our payment systems, the future of banks, the systems behind financial transactions, and the diminishing prospects for cash playing a role in the hyper digitalised societies of tomorrow.
As an analysis of these concepts, ‘The Pay Off’ is fascinating, with genuine insights coming from expert authorities on the subject: Leibbrandt being the former CEO of Swift, the cross-border payments network, while de Terán was for most of the past decade head of corporate affairs at the same organisation. Between them, they reach a surprisingly straightforward conclusion, which is that the most important thing about money is the way in which we move it about. Far less simple is what goes into these payments and how little we understand them.
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