As the GENIUS Act has spurred rampant speculation about banks issuing stablecoins, Citigroup and JPMorganChase are using the underlying technology to gain a digital asset foothold among corporate users. Payoneer this week added technology from Citi to enhance treasury transfers by using Citi’s Token Services, the bank’s blockchain unit. This follows JPMorganChase’s launch of its deposit token, an alternative to stablecoins that also uses distributed ledger technology to speed transaction processing. The banks’ moves position them to leverage their giant payment businesses to offer a range of digital asset services, including stablecoins, placing pressure on other banks to prepare for a range of new products. “Banks, regardless of size, need a stablecoin strategy now,” said James Wester, director of crypto for Javelin Strategy & Research. “That doesn’t mean they need every technical answer, but they do need a clear vision of where they fit and how they will connect their customers, partners, and developers into the next generation of money movement.” Payoneer, a New York-based company that processes B2B and consumer-to-business transfers, will use Citi’s blockchain to move money across Payoneer-owned accounts, reducing the need for traditional payment methods. “Money movements in legacy systems have cut-off times,” Derek Green, treasurer at Payoneer, told American Banker. “Addressing that is a powerful first step in the value of blockchain.” By using Citi Token Services, Payoneer avoids restricted bank hours and closures on weekends and holidays. Payoneer hopes the collaboration will ensure “instant liquidity” through 24/7 transfers between Payoneer users in the U.S., U.K. and Singapore. Using a blockchain reduces cash management and foreign exchange risk; and an application programming interface enables integration with a business’s existing treasury and payment systems, avoiding infrastructure updates, according to Payoneer. The Citi deal helps Payoneer accelerate its ongoing geographic and product expansion. Payoneer’s 2020 acquisition of German payment firm Optile allowed it to integrate payments orchestration with cloud-based technology to power international business payments while adding more countries to its network. “Given our geographic reach [Citi] is a way to make transfers less complex,” Green said. While Payoneer’s partnership with Citi uses tokenized deposits, the use of stablecoins for transactions is a possibility, according to Green. “The blockchain is really the fundamental technology here,” Green said. “The stablecoins would be the mechanism that would facilitate the outcome.” Like most banks and payment companies, Payoneer is still examining how stablecoins would best suit its business. Getting on board with blockchain-powered payment.
Morgan Stanley brings together a broad suite of tax management solutions from MSIM, Eaton Vance and Parametric Portfolio under its Wealth Strategies Group
Morgan Stanley Investment Management (MSIM) announced today that its Wealth Strategies Group has introduced Tax Optimized Portfolio Solutions (TOPS), a tool that brings together a broad suite of tax management solutions from MSIM, Eaton Vance and Parametric Portfolio Associates (Parametric) to meet individual client needs and drive personalized outcomes. Anchored by the expertise and experience of the Wealth Strategies Group, TOPS addresses complex portfolio challenges including managing volatility, enhancing total return, generating income or planning a legacy as well as understanding investment tax implications, in an integrated, highly customized way. “The power of TOPS is bringing together various component pieces and enhancing their individual value by combining them in highly customized ways,” said Brian Smith, Co-Head of the Wealth Strategies Group. “Our team uses the TOPS tool to analyze client-specific financial attributes and develop tailored solution sets to align results with complex financial planning, providing better tax outcomes and adding value to advisor client relationships.” TOPS interprets the features of a broad range of tax management solutions pioneered by Eaton Vance and Parametric and helps advisors better allocate client assets to maximize tax efficiency, generate alpha and income, address complex portfolio concerns and align investments with client priorities. This includes leveraging Parametric’s industry-leading direct indexing, long/short extension, custom option overlay programs and tax optimized ladders as well as solutions to effectively diversify concentrated stock positions and specialized tax-advantaged charitable giving vehicles. “Each individual’s and family’s set of circumstances require in depth knowledge of their situation, preferences and risk tolerance, and must accommodate a broad range of specifications,” said Matt Witkos, Head of North America Intermediary Sales. “TOPS allows our Wealth Strategies Group to identify the most relevant solutions that deliver greater value when combined in a highly customized, results-oriented way, and to provide a continuous glidepath as markets and investor preferences change.” Commenting on the role TOPS plays with advisors he said, “TOPS is a tool that combined with our expertise, positions advisors to be their clients’ trusted advocate and allows them to generate efficient, customized portfolios.” Combined with Eaton Vance’s decades-long focus on tax efficient investing, Parametric’s innovative approach to customization and efficiency establishes a foundation for the TOPS tool that helps position it as the industry-leading, holistic investment tax investment planning strategy for advisors and their clients.
Regulatory pullback heightens fintech risk: uncertain fee caps and federal delays force fragmented state rules, bilateral data deals, rising integration costs, and unpredictable bank data access
Last week, a federal court struck down the Federal Reserve’s Regulation II debit interchange fee cap, upending a framework that defined payment economics for more than a decade. The Consumer Financial Protection Bureau (CFPB) paused its open banking rule under Section 1033 of Dodd-Frank and delayed small business lending data collection under Section 1071, both responding to litigation. The Supreme Court’s Loper Bright decision eliminated Chevron deference, sharply curtailing agencies’ ability to interpret ambiguous laws. From a distance, this looks like a deregulatory moment. For many fintech business models, it creates a high-risk period of uncertainty that can be more damaging than the rules themselves. The Regulation II ruling illustrates the problem. Companies that built their economics around debit interchange fees now face uncertainty. Some use those fees to fund rewards programs. Others share them with banking-as-a-service partners or use them to offer zero-fee accounts. The Fed could rewrite the rule to favor merchants, which would slash interchange rates. But that process could drag on for years, with appeals and maybe even congressional hearings. Meanwhile, companies are trying to plan budgets and investor presentations without knowing what their core revenue stream will look like. This pattern extends beyond payments. Credit card rewards, routing rules, and data rights all face similar risks. When a business model depends on a particular legal framework, and that framework gets sent back to the drawing board, companies operate in uncertainty until something new emerges. What’s likely to emerge is fragmentation. Private companies will cut bilateral data-sharing deals. Different states will write their own rules. Banks will use different technical standards depending on who’s asking for data. For fintechs that need bank data, the complications are significant. Integration costs increase. Product launch timelines extend. And there’s always the risk that key data sources will change terms or cut access entirely. Recent developments illustrate this risk, with major banks beginning to charge fintechs for customer data access through aggregators. Industry executives warn these fees could be devastating for early-stage startups and make certain financial transactions economically impossible for consumers. Without clear federal rules, banks can essentially set their own terms for data access.
Moody Ratings says stablecoin growth could cause a 1% decrease in both bank assets and bank lending — that is, a $325 billion reduction, as issuers favor Treasuries for reserves, raising systemic financial concerns
Banks have been concerned about stablecoin issuers coming for their deposits, but the growing popularity of the digital asset could have wider implications, including a reduction in available credit. While stablecoins are still early in their evolution, they are bound to scale massively, Rajeev Bamra, associate managing director, head of strategy, digital economy at Moody’s Ratings, told American Banker. This scale could impact traditional lending, investment products and marketwide risk as the use of Treasuries as stablecoin reserves impacts other sectors of finance. “Stablecoins’ role in the plumbing of financial markets … is making them more systemically important,” Bamra said. Stablecoins have been growing at a fast clip, with circulation doubling from January 2024 to July 2025, accounting for $30 billion of transactions daily, or less than 1% of global money flows, according to McKinsey and Company. That growth is not expected to slow anytime soon. Today, the stablecoin market is just over $250 billion, with Tether and Circle’s stablecoins making up the lion’s share at $165 billion and $67 billion, respectively. Stefan Jacewitz, assistant vice president and economist at the Federal Reserve Bank of Kansas City, believes that the stablecoin industry will eventually grow large enough to boost demand for Treasury bonds, but that growth comes at a cost as the role of Treasuries declines elsewhere in banking. Presently, the role of Treasuries in the stablecoin market is limited. Stablecoin issuers such as Circle and Tether favor U.S. Treasuries as a backing for their stablecoins in circulation because they are low risk and highly liquid. Both issuers hold about half of their assets in U.S. treasury notes: As of June 30, Circle held just less than half of its total $61 billion in assets, $27 billion, in Treasuries, and Tether held $105 billion in Treasuries to back its USDT stablecoin, according to the two company’s respective transparency reports. “If all issuers held a similar proportion of their assets as Treasuries, they would hold around $125 billion in Treasury bills — less than 2% of the $6 trillion in outstanding Treasury bills,” Jacewitz wrote in a research bulletin. “While this sum is not negligible, the stablecoin industry is not as yet considered a major part of the Treasury-bill market, and issuer behavior likely has a limited effect on overall Treasury liquidity.” The stablecoin industry would need to grow to about $900 billion to reach the size of the next smallest category of U.S. Treasury owners, which are private pension funds that hold a little more than $450 billion in Treasuries. By comparison, the largest private holders of T-bills are mutual funds, at $4.5 trillion, according to Jacewitz. But as stablecoin issuers grow their share of coins in circulation, so too will the demand for T-bills, Jacewitz said. JPMorganChase has estimated that the market will grow to $500 billion by 2028, and Standard Chartered estimated the stablecoin market would grow to $3 trillion by 2028. Analysts at Bernstein are also bullish, and predicted the market could grow to $4 trillion by 2035. “This potential flow of funds from bank deposits into stablecoins could increase Treasury demand but also could reduce the supply of loans in the economy,” Jacewitz said. “Assuming the stablecoin market grows from $250 billion to $900 billion … the $650 billion in growth could represent a shift from bank deposits to stablecoins,” Jacewitz said. “This shift would represent a 1% decrease in both bank assets and bank lending — that is, a $325 billion reduction in bank loans to the economy.”
B2B payment transformation leverages virtual cards, cloud tools, and AI-driven agreements—turning payment practices into collaborative, adaptive engines of cash flow efficiency
Under the combined weight of ongoing tariff-driven uncertainty, macroeconomic disruptions and cash flow volatility, B2B suppliers and buyers are taking a fresh look at the rules of engagement. This renewed attention on accounts receivable (AR) and accounts payable (AP) points to a new era of trust-building in B2B payments may be emerging, powered by technology, alternative financing tools and an openness to collaboration. The integration of suppliers—through digital means, as their billing systems are linked to the buyers’ payment operations—can improve cash flow for both parties, and by extension, create B2B ecosystems that are efficient. Virtual card platforms are also being adapted for B2B trade. By issuing single-use cards with pre-approved amounts and automatic reconciliation, companies can guarantee payment upon delivery while maintaining tight spend controls. Visa and B2B payment orchestration platform Bluechain, for example, partnered to enable digital transformation of B2B payments in the U.K. The trust-building era in B2B isn’t just a mindset change; it’s also being engineered into the payment process itself. Cloud-based procurement platforms now integrate payment scheduling, financing options and tariff tracking in real time. Both buyer and supplier can see where money is, when it will arrive and how external cost factors might change the plan. This transparency is a departure from legacy systems, where payment status was opaque and disputes were resolved by phone or email chains. Of course, the move toward mutual benefit doesn’t eliminate risk, and there’s also the challenge of ensuring digital tools integrate cleanly with enterprise resource planning systems and comply with local regulations. The B2B trust-building trend may only continue to accelerate as generative AI and predictive analytics enhance B2B payment platforms. In this vision, payment terms cease to be static clauses and become living agreements that adapt in real time to economic signals. That adaptability could turn payment practices from a source of friction into a driver of resilience.
Rocket’s AI texting tool helps bankers by drafting messages that are reviewed before sending, boosting outreach by 20% and allowing quick, personalized client communication with evolving AI learning
Shawn Malhotra, the first chief technology officer in the history of Rocket Companies, says it’s pursuing an ambitious plan — to rewrite its entire operating system, from home search through mortgage servicing, on a foundation of artificial intelligence. The transformation will happen while Rocket integrates real estate brokerage Redfin and mortgage servicer Mr. Cooper Group, if the latter deal closes as expected in late 2025. “We are really taking it as a chance to transform the entire trip, not just one part,” said Malhotra, a former Thomson Reuters and Intel executive who joined Rocket in May 2024, at HousingWire’s AI Summit in Dallas on Tuesday. Some results are already showing. In home search, AI models are predicting listing prices with less than a 2% error rate. For purchase loans, Rocket customers using AI-driven chats convert at three times the rate of other channels, and 2.5 times for refinances — helped by the fact that 80% of customers prefer chat. On the origination side, Rocket’s production teams are handling 50% more clients per person year over year. In servicing, AI assists customers with account questions and identifies refinancing opportunities when rates change. Rocket’s data footprint will grow with Redfin and Mr. Cooper, giving its AI tools — including the proactive Authentic AI system and the emerging Model Context Protocol (MCP) — a stronger base. It will put the company in a “good position,” Malhotra said. Malhotra said Rocket’s philosophy is to deploy early and refine in the wild, rather than wait for a perfect product — especially as AI innovation accelerates. “Every day you’re waiting on the sideline is a day you’re not bringing value — and importantly, others in your industry are getting that value,” Malhotra said. “You can’t build a perfect product in planning; you build the perfect product by getting something out, listening to your clients, iterating all that feedback.” As an example, Rocket recently rolled out an AI-texting tool for bankers. There was initial concern about whether messages would be sent automatically without oversight, so Rocket built it in a review loop — bankers can see every message, confirm the recipient and retain full control. According to Malhotra, some messages are excellent and some are flawed, but the system learns from feedback and improves with each iteration. If Rocket had waited to launch until the tool consistently matched or exceeded a banker’s quality, they’d still be waiting. By releasing early, the company has already seen a 20% increase in client outreach from bankers compared to previous years, he added. Rocket has also experienced a “huge democratization” by allowing its employees to write code and develop apps. All activity is secure and private, with thousands of weekly active users across the company — including underwriters, HR staff, finance teams and bankers — to create new innovations. In the battle between human and AI interaction, Malhotra believes customers want AI to reduce redundancies, handle less emotional tasks and save time. But some parts of the process still require a human touch, since the homebuying journey is not like shopping on Amazon — it’s a significant life event.“There’s a human touch that some of them really need, because when it’s your first home purchase — or just any home purchase — I want to talk to someone at some point. You don’t want to throw it over with paperwork,” he said. “This past quarter, we did our first end-to-end refi where the banker was basically just presenting the final qualifications and the final package to the client, but they completed everything through our chat. It took them 30 minutes to get to that point, and we have the goal to make that 10 minutes.” The benefit of having Mr. Cooper and Redfin, Malhotra added, is that Rocket can use customers’ past interactions with those companies to deliver more personalized experiences. “What’s nice about having that end-to-end view is, you’re the same person coming through the system. Depending on how you behave during home search and how you interact with your agent, that might tell me what kind of experience you want when it comes time to refinance your mortgage. I don’t have to relearn that now.”
Zelle slams New York AG lawsuit as publicity driven and not progress, highlighting 99.95% scam-free transactions; claims suit ignores scam origins and could worsen consumer risk by encouraging payouts
Zelle® released the following statement regarding the politically-motivated lawsuit filed by the New York Attorney General that fails to acknowledge that scams don’t start on Zelle, they start with criminals manipulating people long before dollars move. “Zelle® leads the fight to stop fraud and scams in America. This lawsuit is a political stunt to generate press, not progress. The Attorney General wants to hand criminals a blueprint for guaranteed payouts with no consequences, opening the floodgates to more scams, not less. That’s bad policy and puts consumers at greater risk. This is nothing more than a copycat of the Consumer Financial Protection Bureau lawsuit that was dismissed in March. Despite the Attorney General’s assertions, they did not conduct an investigation of Zelle. Had they conducted an investigation, they would have learned that more than 99.95 percent of all Zelle transactions are completed without any report of scam or fraud – which leads the industry. The Attorney General should focus on the hard facts, stopping criminal activity and adherence to the law, not overreach and meritless claims.”
BNY Mellon to be primary custodian for $TBILL “the world’s first tokenized US Treasury fund to receive an investment grade A rating from Moody’s”
Tokenization platform OpenEden said it has appointed the Bank of New York Mellon (BNY) as primary custodian for the underlying assets of its Tokenized US Treasury Bills ($TBILL) Fund which has $287 million in assets under management. It added that BNY Investments Dreyfus will manage the $TBILL Fund on OpenEden’s behalf as sub-manager. OpenEden described $TBILL as “the world’s first tokenized US Treasury fund to receive an investment grade A rating from Moody’s.” While readers might assume that means it is currently A rated, an April report from the ratings agency had downgraded it from A-bf to Baa-bf. Moody’s responded to our queries noting the rating has been upgraded back to A-bf based on the appointment of BNY Mellon Investment Management Singapore as the investment manager. The ‘bf’ in the ratings stands for bond funds and the rating represents Moody’s opinion of the maturity-adjusted credit quality of the assets within the portfolio. It is not a credit rating. While clearly having BNY involved in the fund should provide some peace of mind, an awareness of OpenEden’s controversial background might be useful for investors to make their own judgment.
KeyBank’s move to UJET’s Google Cloud–based CCaaS platform saw agent call volumes decrease by 15% while seeing a 50% increase in agent digital chat volumes and reduction in costs to run the contact center by 10%
As KeyBank continues migrating its systems to the cloud, it has begun to see results. The Cleveland-based bank fully transitioned its contact center to UJET’s Google Cloud–based CCaaS platform, retiring multiple legacy systems. The move led to a 15% decrease in agent call volumes, a 50% increase in digital chat volumes, and a 10% reduction in costs. “We’re rolling out new capabilities that our contact center teammates are loving … it’s going to simplify the role for our teammates, and when we do that we ultimately are going to deliver a better experience for our clients,” said Jordan Olack, director of intelligent automation and contact center. Cloud adoption is accelerating across the industry: Capital One has operated fully on AWS since 2021, JPMorgan Chase partnered with Thought Machine, Wells Fargo opted for a dual-cloud strategy, and Citi announced in 2024 it would migrate some apps to Google Cloud. KeyBank began its own transition in 2019, later expanding to infrastructure in 2022, with the UJET migration spanning May 2023 to October 2024. “We’re actually going right to the source … We are a strategic partner of UJET, and we’ve made equity investments as a bank into UJET as well,” Olack said. “We’ve never thought of them as a ‘legacy bank,’ but rather as an established leader who was looking for a technology partner that could match their ambition,” said UJET CEO Vasili Triant. He added: “Bridging the gap between on-premise procedures and a cloud-native mindset required a highly collaborative and conversational process.” Dylan Lerner, senior analyst at Javelin Strategy, emphasized that cloud transformation is gradual: “Banks rarely go all-in on cloud technology … A piecemeal approach is easier to manage and gives the financial institution time to adjust.” At Cenlar, AI is being applied to reshape mortgage servicing. EVP and COO Leslie Peeler said her IBM experience showed how AI could compress weeks of work into minutes: “That really informed my thinking around how AI could be disruptive beyond smaller point solutions by stringing things together.” “There’s a lot of cost opportunity, certainly, to use AI and generative AI to take cost out of servicing,” Peeler noted, citing chatbot pilots that sped up homeowner responses. Cenlar, which services over 2 million loans, partnered with PhoenixTeam on AI compliance tools: “The process … takes that from a five- to six-week effort down to one to two days.” She stressed that servicing can now rival origination in technology focus: “I don’t think servicing needs to take a back seat.” Cenlar is also launching a “value network” giving managers cockpit-style visibility. “It’s the equivalent of moving from a lack of visibility to what’s under the water to complete visibility,” Peeler said.
BNPL Splitit targets digital wallets starting with Samsung Pay to gives it access to millions of consumers and thousands of merchants that have NFC terminals
As it pushes to expand installment lending inside brick-and-mortar stores, Splitit is turning to digital wallets, hoping to pick up scale with a combination of contactless payments and the vast reach of the big technology companies that operate the apps. The company’s first move is to link to Samsung Pay, which is adding a feature that enables consumers to pay over time using existing credit at the point of sale. Splitit did not release the exact number of merchants that would be added, saying it would be “most stores” where Samsung Pay is available. Splitit, which told American Banker it plans to announce another large mobile wallet integration in the coming months, is seeking to reach more merchants as more payment technology companies and banks join the fintechs that have dominated the BNPL industry. “An NFC wallet gives us access to millions of consumers and [thousands] of merchants that have NFC terminals,” Splitit CEO Nandan Sheth told American Banker.
Sheth was referring to near-field communication, the technology that enables mobile phones to “talk to” point of sale terminals that accept contactless payments in stores. Eleven years after the launch of Apple Pay, which uses NFC as a core technology, there are more than 230 million NFC terminals globally, according to Research and Markets, adding that 99% of POS terminals shipped in North America and Europe are NFC enabled, with near saturation in Latin America and Asia. Samsung Pay is on pace to process more than 1.6 billion payments globally, and has 35 million active users in the U.S., according to Coin Law, which reports Samsung Pay’s compound annual transaction growth rate in the U.S. is 9%. Apple Pay has 69 million users in the U.S. and 659 million globally, according to Coin Law, which adds Google Pay has 165 million U.S. and 820 million global users. NFC payments are 85% of Samsung Pay transactions, and the app is available in 31 countries. “We’re starting in the U.S. but Samsung Pay is globally large and will move into the large Samsung Wallet markets, primarily in Europe and Asia,” Sheth said. Samsung did not return a request for comment. Like Apple and Google, Samsung has added financial products to its mobile technology over time, giving Samsung incentive to add features that enable flexible payments. For example, Samsung Pay in late July became a payment method and deposit option for trading user accounts in the Coinbase app, boosting Samsung’s reach into digital assets. As Samsung Pay and other mobile wallets grow, Splitit can boost usage by creating payment flexibility, Sheth said. “We can engage those consumers inside the wallet and drive foot traffic for merchants that accept NFC terminals,” Sheth said, adding Splitit would aggressively market to consumers ahead of the holidays in December.