Elon Musk has never made a secret of transforming financial services being among his many grand ambitions. The recent announcement of his X platform’s partnership with Visa to support P2P payments via the soon-to-be launched X Money is a major step towards making that vision a reality.
While Musk clearly has digital payment providers like PayPal's Venmo in his sights, in our view a much wider range of enterprises, and banks in particular, should take note. As the shift towards digitally-driven, engagement-based financial services gains strength, staying close to the customer and their needs is paramount – and any new business that captures customer attention and interactions represents a challenge.
The Visa partnership is a masterstroke; it provides the rails and, crucially, the credibility needed to convince X’s 600-million-strong captive user base to transact within the platform. X’s MTL (Money transfer licence) and Visa’s rails in the United States (a market that accounts for around 100 million X users) should enable X to provide both money transfers and payment processing.
The main beneficiaries will be the X platform’s many content creators, who will be able to receive payment for their work without needing to turn to third-party payment platforms. A more frictionless experience will not only boost the creative economy being nurtured inside the platform but will also deepen creator loyalty and engagement, making X’s digital ecosystem even stickier.
The eventual impacts could be far more significant. By offering incentives to users to store funds within the platform, X Money could soon begin to compete with banks and other peer-to-peer (P2P) payment providers in terms of scale. The combination of Musk’s ambitions and X’s reach make it easy to imagine the platform expanding beyond payment processing to encompass a broader range of offerings, from consumer credit to insurance. Musk’s pro-crypto stance also makes it highly likely the platform will intersect with the burgeoning crypto sector, not least with the launch of an X Money stablecoin.
One app to rule them all?
Visions of X Money morphing into a ‘super app’ like China’s WeChat may be overblown. At least in North America, consumers have demonstrated little appetite for these kinds of all-encompassing solutions. Nonetheless, it’s all but certain that the X Money universe is poised to develop rapidly and capture a greater share of users’ wallets and financial activity. The question is what does that mean for the rest of the industry, especially legacy banks already grappling with a surge in digital competition?
First, the providers of digital wallets and other payment systems that X users may no longer have to depend on will need to consider how they’ll encourage users to retain these systems as their primary mode of payment and foster longer-term loyalty. As a growth strategy, X could be expected to offer incentives and discounts to keep paid users within its ecosystem and may push more unpaid X users to migrate to its paid model. Other providers, like Venmo, CashApp and Zelle may respond with instant interest-bearing balances for users storing funds in their digital wallets, while Apple Pay and Google Pay could push deeper into embedded lending and rewards.
For banks, this is another major wake-up call to adopt an open, API-first approach that enables enterprises like X Money to interact with their systems. Having worked with both fintech disruptors and legacy financial institutions building infrastructure to adapt to the rise of embedded finance, we’ve seen how these trends benefit both sides. JPMorgan, for example, has developed embedded payments capabilities to cement the loyalty of its commercial customers. Spain’s BBVA has leveraged industry-leading open banking solutions to reach a broader market. Challengers like Revolut and Monzo have gained ground in part by offering features that traditional banks still lack, such as crypto integration and instant creator payments.
The cost of complacency
The alternative for banks is to do nothing and continue to wall off systems from new payment providers. But we’re starting to see the consequences of that choice. In India for example, bank mobile apps account for less than 5% of instant payments, with third-party wallets making up the vast majority.
Banks are starting to realize that however small some of these transactions may be, individually, they represent a crucial point of contact with the customer, and collectively amount to something meaningful. Each transaction is also potentially the first point of predicting churn. A customer using a third-party app for payments will soon be comfortable doing the same for insurance, credit or investment – and as more countries adopt open banking standards that give consumers more control of their financial data, making the switch will only get easier.
Each transaction that migrates elsewhere is a missed opportunity to drive engagement with the customer or derive insights from data. As ecosystems like X Money gain traction and extend their capabilities, legacy banks risk becoming relegated to the license holders and custodians of funds, while all customer interaction takes place outside their carefully protected gardens.
Adapting to a new financial landscape
In the world of embedded finance, technology is no longer just an enabler—it is the decisive factor separating industry leaders from those left behind. As open banking expands into open finance and open data, enterprises must seamlessly integrate payments, data, and customer engagement to remain competitive in a rapidly shifting ecosystem.
For incumbent banks, this means evolving into an API-driven powerhouse that keeps banking services at the core of customer interactions. For challengers entering financial services, it means navigating the complexities of payments infrastructure at scale—without compromising on security, compliance, or performance.
At Thoughtworks, we don’t just observe these transformations—we build them. Our expertise in modernizing payments infrastructure, embedding finance into digital ecosystems, and developing API-first architectures has helped global financial institutions transition from legacy models to real-time, adaptive financial networks. Whether it’s powering instant settlements, architecting super apps, or ensuring regulatory compliance, we help businesses stay ahead of disruption rather than react to it.
All this work serves a single goal: unlocking new value opportunities for enterprises and their customers. The impending launch of X Money is the clearest signal yet that the payments space will only grow more contested and presents industry players with the stark strategic choice of actively participating in fast-growing ecosystems, or fading quietly into the background.