Seizing Quantum Computing’s Opportunities Within Payments and Finance

When OpenAI’s ChatGPT was released a year ago, it seemed to come from nowhere.

But the emergence of generative artificial intelligence (AI) as a viable, usable commercial product was, in reality, the end result of countless decades of research and untold billions of dollars of investment.

Still, that an upstart and former nonprofit had surprised the rest of the tech landscape, including long-time AI pioneers like Google, and gotten there first with a standalone AI interface was somewhat surprising. That OpenAI had done so with billions of dollars in support and by partnering with Microsoft was less surprising.

This, as another revolutionary technical innovation, quantum computing, is rapidly percolating in the background of today’s landscape, being developed in a similar way and by similar players as AI.

The computing power and quantum capabilities being developed in today’s corporate and academic research labs and national development programs are like nothing the world has ever seen.

Yet the world may see them soon enough. A recent benchmark experiment suggests quantum-powered applications could be a commercial reality within the next two years.

Are we ready for the changes it will bring to the payments and finance industries?

Read also: Quantum Computing Could Change Everything

Quantum Computing and the End of Encryption

Similar to how today’s bleeding-edge generative AI capabilities moved beyond the sequential limitations of prior algorithms by using transformer neural networks and multi-head attention mechanisms to collate and produce relevant information sets in real-time from vast data, quantum computing provides a comparable paradigm shift in how information is encoded and acted upon in a computing environment.

While traditional computers process information by breaking it down into binary zeros and ones, quantum computing is driven by qubits (quantum bits) that break down information across fundamentally different planes and allow quantum processors to tackle complex problems in fundamentally different — and more advanced — ways by placing the quantum information into a state of superposition.

This new approach to presenting and solving complex problems via quantum superpositions will leave a lot of legacy processes in the proverbial dust and create a mix of both opportunity and risk for security-critical operations in sectors like healthcare and finance.

That’s because quantum computers are predicted to be able to solve for all of the mathematical encryption schemes currently used around the world to protect sensitive information and valuable data.

Michael Jabbara, global head of fraud services at Visa, told PYMNTS in March that bad actors are already starting to steal and hold onto encrypted data in preparation for quantum computing tools to enter the market and allow them to decrypt the information.

Observers believe that creating one-way function encryption schemes that are impossible for tomorrow’s quantum computers to crack may not ever be a possibility.

But the news around quantum computing isn’t all apocalyptic. The technology represents a whole new paradigm of opportunity, particularly for financial and payments players.

More like this: Quantifying Quantum Computing’s Value In Financial Services

The Upcoming Hyper Computing Payments Landscape

Firms wishing to take advantage of the promise of quantum computing have a variety of areas where the computing innovation’s advantages will be evident compared to classical ways of doing things.

Quantum computing can run complex simulations at unprecedented speeds, leading to better-informed investment and business decisions, and its ability to process huge amounts of data instantaneously will make it invaluable is areas like risk analysis and credit underwriting.

The computing innovation, once commercialized in the coming years, will also revolutionize compliance processes within the financial services sector by streamlining and identifying patterns and discrepancies; as well as transform data management more generally — leading to operational optimizations across areas such as logistics, supply chain management and resource allocation, by finding the most efficient solutions to complex problems.

So, after decades of R&D and billions of dollars of investment, what is the current state of today’s quantum computing landscape?

In a word, it is promising.

Already, back in 2019, Google’s prototype quantum computer was able to solve a problem in 200 seconds that would have taken a legacy digital computer 10,000 years.

And now, large tech companies like IBM and Google are making rapid progress in developing quantum computing hardware and capabilities, as are quantum-specific startups and ecosystem players like Rigetti, Pasqal and Infleqtion.

Banks like JPMorgan, Wells Fargo and Goldman Sachs, as well as their international peers like Japan’s Mizuho, are already experimenting with quantum technologies and edge computing capabilities.

The quantum revolution may not be here quite yet, but the innovation itself is no longer purely theoretical — and its impact is just waiting to be realized.