Big Moves from Plaid, Square, and Mastercard

This week’s Today in Payments covers Plaid’s landmark agreement to pay JPMorgan for data access, a move that could reshape the future of open banking. Square simplifies its pricing with a streamlined three-tier structure aimed at helping sellers grow without complexity. Meanwhile, holiday spending forecasts from Mastercard and Adobe point to strong online sales, with Buy Now, Pay Later and AI-powered shopping tools playing a bigger role than ever.

Welcome to Today in Payments, I’m your host, Patti Murphy, here with your weekly dose of payments notes.

Double-Digit Revenue Growth Opportunities in Payments

Global payments revenue is projected to grow from $1.9 trillion in 2024 to $2.4 trillion by 2029, according to new research by Boston Consulting Group (BCG).

But suffice it to say, this won’t be your parents’ payments revenue pie. The consultancy said the industry is headed for a “foundational reset.” AI, digital currencies, and fintech business models are poised to shape the next wave of industry expansion.

In a report titled The Future Is (Anything but) Stable, BCG noted that while global payments revenue reached $1.9 trillion in 2024, future growth is expected to slow. After growing at an average of 8.8% annually since 2019, revenue expansion is projected to ease to 4% annually. Transaction-based revenues remain strong, while deposit margin tailwinds are weakening.

Other key predictions from the report:

• Agentic AI is set to influence over $1 trillion in e-commerce spending.

• Payments fintechs generated $176 billion in revenue in 2024 and are growing at 23% annually.

• Payments-focused fintechs have attracted over $135 billion in equity funding over the past 25 years and now make up 45% of total fintech revenue, BCG said. The top performers are growing three times as fast as incumbents.

Real-time account-to-account (A2A) payment volumes rose 40% globally in 2024. These systems now account for roughly a quarter of digital retail payments worldwide—and over 50% in certain markets like Brazil. That country’s instant payment network, Pix, is currently under scrutiny by the Trump administration. The Office of the U.S. Trade Representative is investigating Pix, alleging that it unfairly competes with U.S. firms like Visa and Mastercard. According to The New York Times, all Brazilian banks are required to participate in the Pix network, which is owned by the Brazilian government. Notably, 80% of Brazil’s population uses Pix—and it’s free to use.

Stablecoins reached a cumulative market value of $26 trillion last year, but real-world payments accounted for just 1% of that total. Most of the activity remains concentrated in crypto trading, the consultancy noted.

Plaid to Pay JPMorgan for Data

JPMorgan Chase made headlines—though not the good kind—this past summer when it announced plans to charge fintech firms for accessing consumer account data that had previously been provided for free. Fintech groups blasted the move, calling the fees “exploitative tolls.”

Now the first domino appears to have fallen. Plaid has agreed to pay for access to data from Chase accounts held by its users. The companies announced the deal as a step forward for “continued innovation” in open banking.

Fintech groups remain critical. The Financial Technology Association said such fees are “prohibited by current law and statute,” according to published reports.

The Consumer Financial Protection Bureau (CFPB) had adopted an open banking rule in 2023, which would have required banks to make consumers’ financial statements available to authorized third parties in standardized formats—free of charge. That rule has since been retracted and is being rewritten by Trump administration appointees.

Square Simplifies Pricing

Square has announced a new, simplified pricing structure that it says will make it easier for sellers to access and use its full suite of commerce tools. The new three-tier system—Square Free, Square Plus, and Square Premium—replaces 18 different à la carte plans. The updated pricing is designed to grow with sellers as their businesses evolve, according to a press release.

Earlier this year, Square unified its Square Point of Sale app, combining all vertical-specific software into a single, adaptable platform.

Square says its software drives as much as 9% more sales for businesses. The new pricing plans are designed to make it easier than ever for sellers to access growth tools without navigating a complex subscription landscape.

Here’s a breakdown of the new plans:

• Square Free – Costs nothing and includes point of sale, websites, online ordering, invoicing, and access to Square Banking.

• Square Plus – $9/month/location. Includes all Square Free features, plus advanced POS tools across 7 point-of-sale modes (e.g., QSRs, bars, salons), as well as loyalty, marketing, inventory, and staff management tools. Processing rate for in-person payments drops to 2.5% + 15¢ (compared to 2.6% + 15¢). Card-not-present payments remain 2.9% + 30¢.

• Square Premium – $149/month/location. Includes nearly all Square software features, 24/7 phone support, advanced reporting, and a reduced in-person processing rate of 2.4% + 15¢.

The new plans are available now for all new U.S. sellers. Most existing U.S. sellers are eligible to migrate, Block said in its announcement.

Holiday Shopping Predictions Point to Big Online Spend

Holiday shopping has already begun, and spending patterns are starting to emerge, according to the Mastercard Economics Institute’s annual holiday forecast for the U.S. and Canada.

In the U.S., online sales are expected to continue outpacing in-store shopping. E-commerce is projected to grow 7.9% year over year, compared to just 2.3% for brick-and-mortar.

Adobe forecasts that consumers will spend $43.7 billion during Cyber Week alone—a 6.3% increase over 2024. Both Adobe and Mastercard expect Black Friday sales to outperform Cyber Monday.

Buy Now, Pay Later (BNPL) is expected to drive $2 billion in online spending this season as shoppers look for more flexible payment options. Adobe also noted that generative AI is influencing shopping habits, with consumers turning to AI-powered chat and browser tools to research products and find deals.

Mastercard also predicts a surge in gift card purchases, as consumers turn to them to manage rising prices while giving recipients more flexibility.

That’s all for Today in Payments. Stay tuned for your weekly dose of payments notes.