For all the talk of “fintech innovation,” small payments remain strangely broken. And small payments are actually most payments!
Banks are slow, expensive, and bureaucratic. Card networks appear fast, but only by hiding complexity and risk behind layers of intermediaries. And when it comes to genuinely small payments—pennies, cents, fractions of a cent—almost nothing works well enough to bother using.
This isn’t a temporary problem. It’s structural.
Why banks and cards can’t fix small payments
Traditional banking systems were never designed for fast, low-value, high-frequency transfers. They evolved to move large sums infrequently, with reconciliation happening later. Speed was not a goal; caution was.
Card networks solved a different problem: consumer convenience. They allow a payment to appear instant, while the real transaction settles days or weeks later. That delay isn’t a flaw. It’s how chargebacks, fraud detection, and dispute resolution are made possible.
The cost of this model is enormous. Merchants pay high fees, fraud losses are socialised across the system, and security breaches are so routine that banks often focus more on managing disclosure than preventing incidents.
Card payments feel fast because the risk is pushed onto merchants. Lightning is fast because the payment actually finishes.
This distinction matters. A payment that can be reversed weeks later is not the same thing as a payment that has settled.
Push payments change everything
Most legacy payment systems are “pull-based”: a merchant requests money, and the system attempts to collect it. This is why fraud is endemic—anyone who can impersonate a merchant can try to pull funds.
Lightning is a push-based system. The sender initiates the payment. There are no card numbers to steal, no reusable credentials, and no mechanism for silently extracting funds from someone else’s account.
The result is not just better security but a simpler and more honest trust model.
What’s already possible today
With Lightning, it is already possible to build systems where:
- A sender pays a recipient directly
- The payment settles in seconds
- A third party can cryptographically verify the payment almost immediately
- Balances update in real time
- No bank or payment processor needs to be involved
This is not theoretical. These systems exist and work reliably today, even for very small amounts. The full round trip, from payment to verification to account update, can take only a couple of seconds.
No mainstream banking infrastructure can do this, especially not cheaply and without taking custody of funds.
Small payments unlock new behavior
Once payments become cheap, fast, and final, entirely new patterns emerge.
One often-cited example is streaming money, a concept popularized by Andreas Antonopoulos. Instead of paying upfront or in fixed chunks, value flows continuously over time: per second, per minute, or per unit of consumption.
This enables things that are awkward or impossible with traditional systems:
- Pay-as-you-go media
- Real-time donations and tipping
- Per-use APIs and services
- Live wages or revenue sharing
- Granular paywalls without subscriptions
Banks don’t merely fail to offer these features—they lack the conceptual framework for them. Their systems move balances in batches. Lightning moves value as a flow.
Coordination without custody
One of Lightning’s most overlooked properties is that it allows coordination and accountability without acting as a financial intermediary.
In traditional donation or aid models, money flows through an organization. Donors send funds to a central entity, which then claims to distribute them to recipients. This provides some reassurance, but only by granting the intermediary control over the money—along with the power to delay, redirect, skim, or obscure what actually happens.
Lightning makes a different structure possible.
It is possible to generate a Lightning invoice for a wallet that is not your own, present that invoice to a sender, and then independently verify, within seconds, that the payment arrived at the intended destination.
Crucially, the verifying party never takes custody of the funds and cannot move them.
This preserves the key advantages of an intermediary (verification, signaling, and accountability) while removing the main disadvantage: control over the money.
For donors, this means reassurance without trust. Funds go directly to recipients, yet there is still visibility into what is happening within the system. For recipients, it means sovereignty: no organization can freeze, redirect, or quietly deduct from their income.
This kind of peer-to-peer accountability is extremely difficult to achieve with banks or card networks and awkward or expensive to replicate on traditional blockchains. On Lightning, it emerges naturally from how invoices, settlement, and verification work.
What’s new here isn’t faster payments—it’s the separation of verification from custody.
Not the future: just the present
Lightning is often described as a payment network: faster, cheaper, and more efficient. That description undersells what is actually happening.
By combining push payments, instant settlement, and non-custodial verification, Lightning enables systems that were previously assumed to require trusted middlemen. It allows coordination without control, accountability without custody, and speed without the risk being pushed onto someone else.
This doesn’t mean Lightning will replace banks, card networks, or blockchains. It means that for a growing class of problems (small payments, real-time value transfer, streaming money, direct support) those systems are simply not competitive.
What is striking is not how futuristic Lightning is, but how ordinary it already feels once you use it. Payments complete. Accounts update. No one waits, no one reverses anything, and no one quietly takes a cut in the background.
If you need fast, cheap, small, final payments today, the field is oddly empty. Strip away familiarity and inertia, and Lightning no longer looks like an experiment.
It looks like the only thing that actually works.
