When I come across something big that I don’t know anything about it gets my attention.
I never heard of Fiserv before. What is Fiserv?
Fiserv is a fintech company that plays a crucial role in enabling the movement of money and facilitating financial transactions for thousands of financial institutions and millions of people and businesses worldwide.
Fiserv offers solutions for banking, global commerce, merchant acquiring, billing and payments, and point-of-sale systems. This includes platforms for digital banking, account processing, loan origination, cash management, and risk management.
A significant part of Fiserv’s business involves enabling electronic payments. This encompasses services like electronic bill payment, internet and mobile banking, debit and credit card processing, and person-to-person payments. They operate networks like STAR and MoneyPass.
Fiserv is actively involved in developing and adopting new technologies like AI, big data, blockchain, cloud computing, and real-time payments. They recently launched their own stablecoin (FIUSD) and are collaborating with companies like Circle and PayPal to explore stablecoin-enabled solutions for financial institutions and merchants.
I tend to take the plumbing of the financial system for granted but Fiserv is about to revolutionize the banking system for smaller regional and community banks.
Stablecoin World Opens Up to Main Street Banks
Regional and community banks will be able to get in on the stablecoin market through Fiserv ventures with crypto firms and PayPal
By Gina Heeb, The Wall Street Journal, June 23, 2025
Key Points
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Fiserv plans to launch a stablecoin and platform for its clients, which include roughly 3,000 regional and community banks.
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The platform should be compatible with other stablecoins and aims to help banks keep pace with crypto’s move into finance.
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The FIUSD stablecoin will have fraud controls, with large banks handling custody.
The Fiserv stablecoin platform is expected to be compatible with other stablecoins and allow for easy connection with the other 10,000 financial institutions and millions of merchant locations that Fiserv works with…
Fiserv will build its platform on top of the payments and financial-services technology through which it already touches trillions of dollars in transactions each year. The stablecoin will be called FIUSD, but banks could work with Fiserv to create their own branded coins. …
A broad shift to crypto would put at risk the deposits that regional and community banks are especially reliant on to make loans. If customers were to pull deposits out of accounts and put them into stablecoins, that would leave the banks less room to lend, a critical source of revenue. …
Fiserv said it would allow its bank clients to implement its stablecoin technology at no additional cost. But it will demand transaction fees and part of the yield earned through reserve investments such as Treasurys. [end quote]
My understanding is that Fiserv isn’t a shadow bank but is analagous to a pipeline company. A huge amount of money passes through their electronic systems and some of it sticks to Fiserv. Their profit margin is 15%.
I still don’t understand why a customer would benefit from using stablecoins rather than USDs for purchases though I understand why companies might benefit. (e.g. lower costs to process vis-a-vis credit cards.)
Fiserv appears to be an innovative company. I hope that the FDIC and Federal Reserve are watching this potential revolution in Main Street banking carefully to avoid situations where small local banks could be harmed.
Wendy