Figure 6: Payment Methods Chart (data from eMarketer.com)
Conventional digital payment companies make money by charging a fee to merchants (see figure 7). For example, Square Cash charges a 2.75% per transaction fee to merchants. Venmo charges a similar 2.9% of the transaction plus $0.3. A stablecoin company could potentially undercut this fee by leveraging blockchain to lower their own costs per transaction. Businesses could be incentivized to use a stablecoin solution in order to drive the profit margins.