Thursday, May 22, 2014

A Generic Payment Hub 

What is it?

A payment hub is a single junction where streams of money intersect. Usually such a junction contains a collection of other functions that route, track, administer, and tax money flow.  My accounting software is a payment hub. So are quasi-government agencies or commercial bank wire rooms. I don’t use half the functions of my accounting software, and it does not have half the functions needed by payment infrastructure institutions. However, size does not define a payment hub, functionality does. If you have a single junction where streams of money intersect you have a generic payment hub. Diagram 4 shows the concept.

Diagram 4: A Generic Payment Hub

A fancy drawing of a bum’s pocket becomes more interesting with electronic flows instead of manual ones.

I wanted to describe an electronic payment hub because it is the fundamental building block of macroeconomic payment architecture. We will need it later to critique the payment architecture we have in place, grown haphazardly as any human sprawl, and to design solutions for interactions within a common market place controlled by diverse governments.

Next Blog: Security and payment structures, or payment hub interface design concepts (the control process)

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