Banks Could Lose $170B to AI Disruption, McKinsey Warns
A new McKinsey report warns that AI-driven automation and shifting customer expectations could erode up to $170 billion in bank profits annually. While AI adoption can significantly reduce costs and improve decision-making, many banks remain burdened by legacy technology and slow transformation cycles. The consultancy says winners will be those that aggressively redesign processes around AI rather than simply layering tools on top of outdated systems. Customer-facing areas like lending, fraud prevention and personalized engagement are expected to see the most value creation. However, banks that fail to keep pace could see margins compress as fintechs and digital-first competitors move faster. The report emphasizes that urgency, not experimentation, will define competitive advantage. In the end, AI won’t just improve banking — it will separate leaders from laggards.
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The rise of agentic commerce and threats to retailers
AI shopping agents are reshaping digital commerce by automating what once required active consumer effort. Instead of manually searching and comparing, users now rely on agents that scan multiple platforms, filter results by preferences, compare prices and features, and make context-aware recommendations.
As trust grows, these agents are starting to complete transactions—checking delivery times, applying stored payment details, and finalizing purchases autonomously. The result? A frictionless, conversational shopping experience requiring minimal human input.
Adoption is accelerating fast. Traffic to U.S. retail sites from GenAI browsers and chat services surged 4,700% year-over-year in July 2025, per Adobe. These users also engage more—spending 32% more time, viewing 10% more pages, and showing a 27% lower bounce rate.
Major players like Perplexity, ChatGPT, and Google Gemini are racing to embed commerce features. Perplexity launched Buy with Pro, enabling in-chat purchases, and integrated Firmly AI, connecting merchants directly. A partnership with PayPal now powers seamless checkout inside the chat.
ChatGPT introduced Instant Checkout, letting users complete purchases within the chat window—starting with Etsy and expanding to Shopify merchants soon. Meanwhile, Google’s AI Mode is evolving beyond browsing and comparison to include price tracking and direct checkout via Google Pay.
Curated News
💳 Payments
Finix & Interac Expand Merchant Payment Options in Canada
Finix teams up with Interac to broaden digital payment capabilities for merchants across Canada, improving transaction flexibility and customer choice. This could strengthen Finix’s North American footprint as competition intensifies.
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Worldpay Adds Tap to Pay on iPhone for SwipeSimple Merchants
Worldpay now enables SwipeSimple merchants to accept contactless payments directly on iPhones, removing the need for additional hardware. The move supports continued mobile-first growth among small businesses.
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Worldpay Integrates Affirm for SaaS Embedded Payments
By bringing Affirm’s BNPL option into its embedded payments suite, Worldpay is helping SaaS platforms offer flexible consumer financing at checkout. The integration may boost conversion and broaden merchant adoption.
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Alchemy Pay & dLocal Enable Instant Bank Transfers in Argentina
Alchemy Pay partners with dLocal to roll out fast, bank-based payments in Argentina, tackling local FX and infrastructure constraints. This helps global merchants reach Latin American customers more effectively.
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Finzly Deploys Agentic AI Across Payments Operations
Finzly is embedding agentic AI into its products to automate payment workflows and reduce manual intervention. The upgrade aims to increase speed and accuracy for financial institutions modernizing their infrastructure.
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🏦 Banking
Citigroup’s Jane Fraser Becomes Chair, Receives $25M Stock Award
Citi CEO Jane Fraser is now also chair of the board, consolidating leadership as the bank continues restructuring. The stock package signals confidence in her long-term turnaround strategy.
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Pave Bank Raises $39M to Build First “Programmable Bank”
Pave aims to architect infrastructure that enables smart contract-based banking services, blending compliance with Web3 functionality. The raise supports product build-out and regulatory go-to-market execution.
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FintechOS Hits 50% ARR Growth, Expands in Banking & Insurance
FintechOS reports continued international expansion and rising ARR, driven by banks modernizing digital experiences. Its low-code approach helps institutions accelerate transformation while containing costs.
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Grasshopper Bank Launches Innovator Term Loan for SMB Growth
Grasshopper introduces a new credit product designed to fuel capital access for growing small businesses in innovation-led sectors. The offering positions the digital bank to capture more commercial lending demand.
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Bizcap Acquires AI-Driven Funding Platform
Australian lender Bizcap has purchased an AI-powered underwriting platform to expand its ability to serve riskier SME borrowers. The acquisition strengthens data-driven lending capabilities.
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🪙 Crypto
Canadian Regulator Fines Cryptomus C$177M
A major Canadian watchdog has issued a C$177M penalty against crypto payments firm Cryptomus for compliance failures. The enforcement highlights increasing global scrutiny of crypto AML controls.
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Fireblocks Acquires Dynamic to Expand Web3 Developer Tools
Fireblocks is broadening its developer stack through the acquisition of Dynamic, enabling more seamless authentication and MPC wallet infrastructure for on-chain apps. This accelerates enterprise-grade blockchain tooling adoption.
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Hong Kong Approves First Solana ETF
Hong Kong regulators have greenlit the first Solana-based ETF, expanding institutional access beyond Bitcoin and Ethereum. It signals further diversification in regulated crypto investment products.
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Melania-Coin Wallets Receive $1.2M Airdrop
Wallets tied to the “Melania Trump” meme coin unexpectedly received $1.2M worth of Meteora tokens via airdrop. The episode underscores the unpredictable — and sometimes lucrative — nature of meme-economics.
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📈 WealthTech
Plynk Launches Military-Focused Investing Services
Plynk introduces a new initiative supporting active-duty military and veterans with education-backed investing tools. The company aims to close financial literacy gaps in underserved communities.
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🧩 Fintech
LSEG Invests in Post-Trade Solutions
The London Stock Exchange Group is partnering and investing in Post Trade Solutions to enhance clearing, risk management, and post-trade efficiencies. It supports modernization efforts amid rising volumes and regulatory demand.
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Riverchain Raises $5M to Scale Across Southeast Asia
Hong Kong fintech Riverchain secures fresh capital to expand its operational footprint into Southeast Asia. The company focuses on blockchain-anchored trade and supply chain solutions.
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Domino Helps Enterprises Scale AI ROI
Domino launches a solution designed to help enterprise IT maximize the impact of AI investments while reducing operational costs. The platform targets organizations struggling with AI deployment at scale.
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📜 Regulation
NYDFS Publishes Guidance on Third-Party Cyber Risks
New York regulators have issued fresh guidance requiring financial institutions to strengthen oversight and risk controls over technology vendors. The update underscores growing concern over supply-chain vulnerabilities.
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