Dateline: London, 11th May 2023.The economist John Kay wrote in a paper on “Robust and Resilient Finance” that while “many aspects of the modern financial system are designed to give an impression of overwhelming urgency… only its most boring part – the payments system – is an essential utility on whose continuous functioning the modern economy depends”. His choice of word — utility — is interesting. Just like the electricity network or the water system, not only are payments a utility but they are also critical infrastructure: If the stock market shuts down for a day, life goes on, but if salary payments stop because of a bank failure, customers cannot access their money because of bug-ridden software update or debit cards stop working in supermarkets because of misplaced cost-saving on testing, there is chaos. Perhaps we need to think again how the payments system works.ShareCritical InfrastructureMatthew Klein says that banks are speculative investment funds grafted on top of that critical infrastructure and goes on to suggest that the public sector should embrace the role because money and the payments system are public goods. As he sees it, banks could focus on (what should be) their core competency of identifying creditworthy borrowers and making profitable loans. I think this is a very interesting perspective that is brought into focus because of two imminent developments in that critical infrastructure: FedNow, which is coming along in the summer, and the Digital Dollar, which could well be coming along soon.Subscribe nowI mention both of these…Payments Are A Utility. And Critical Infrastructure.