What's fascinating about spending time with Peabody is that despite the mind-boggling complexity of the payments industry -- only insomniacs would tackle the tedium of how merchant processors differ say, from card networks -- innovation in today's payments biz can actually draw a logical line all the way back to the days of the Kennedy administration.
Even more interestingly, Peabody points out that the next big round of innovation in payments will not come from disruptive Silicon Valley startups such as PayPal or Square. Rather, the payments industry itself is adapting to tomorrow on its own. Starting last year, a consortium of large merchants founded something called the Merchant Customer Exchange. This MCX, as it is called, is backed by giants including Banana Republic, Walmart ( WMT) and Shell ( RDS.A). And the startup, which just hired a chief executive named Dekkers Davidson, plans to build a payments network around mobile devices. Though it is still in its infancy, the MCX is expected to slowly but surely grow to rival payments heavies such as Visa and MasterCard over the next decade, bringing a new generation of payment options to consumers -- but in small, dare I say, planned steps. "It will take years for them to gain a foothold. Five percent is a lot of market share in this business," he said. But slowly but surely, the business of moving money in the digital age will be just as innovative as moving music or books. But it will get there with much less pain -- and much more profit -- than most anywhere else in the digital economy. "You are talking about money here," he said. "Nobody is going to mess around."