top trends in payments 2018
The future is here. Mars may not be the frontier just yet, but we are living in a world any 50-year-old from the 1950s would recognize as being more similar to a science fiction fantasy rather than their own reality. We keep hearing and reading about how technology is changing the world. It is not.
What we, as individuals and as a culture, do with the shiny new technologies - inventions, innovations, gadgets - is what shapes the reality we live, love and do business in. How we interact with the technology, how we relate to it and how (much of it) we take for granted is the crucial ingredient that changes our world.
GENERATION Z TO SHAPE THE FUTURE
Apple, Amazon and Alibaba - the behemoths of digital commerce - are stepping into brick-and-mortar stores. No accident there. They have recognized the needs of Generation Z. And no, this is no generation of zombies! They do, however, bring a big surprise, one to be very aware of: for them, the internet is so ubiquitous they don't see the difference between online and offline. And that is just the beginning. Generation Z is here to truly shake up the future.
A CUSTOMER DRIVEN PAYMENT EVOLUTION
It looked like we were going to be paying for everything with mobile. There was Booking.com for renting a room, Uber for getting a ride and millions of mobile apps-to-be for anything one could imagine. Seamless payment on mobile was simple, sexy and very successful. It made everybody happy: banks, service providers and customers. But desires never wane, so now we live in a world in which a fridge can, on its own, order and pay in our name and where businesses can automate payments to a level unimaginable before.
SUBSCRIBE ME TO THIS LOYALTY
Loyalty keeps business growing, and plenty of financial services utilize this notion - credit cards, funds, insurance companies, etc. Finding a new unique proposition that inspires loyalty in existing and kindles it in new customers might be a big challenge for banks, but each time it is faced, it is helping create innovative services, such as subscriptions which Millennials and Generation Z love. Satisfying financial needs, while looking as sleek as Apple or Google.
Generations which prefer subscriptions over ownership are ushering in a new concept of loyalty, supported by omnichannel and based on a profound knowledge of the customer lifestyle.
PAYMENTS ARE SMART, TOO!
Everything is becoming smart - phones, watches, fridges, TV sets, cars, elevators, even cities… What about payments? Mobile payments, mobile wallets, mPOS and payments inside mobile apps are now ordinary. Paying with a ring, a bracelet or a scan is becoming ordinary faster rather than slower. The financial industry being an exquisite source of data, a true heaven for AI and big data, makes new and emerging technologies just the beginning of a shiny new reality of smart payments on the horizon. A brave new world of the Internet of Payments is coming.
KEEP CALM AND CARRY ON REGULATING
As of May 2018, banks will be obligated to officially report hacker attacks on their infrastructure and services, be these successful or only attempted. GDPR decrees banks must know at all times who has access to which information, as well as when, where and how they have access to it and whether they can change it. Customers must be able to access, change and/or erase their personal data at will. At the same time, PSD2 regulations stipulate banks to have to open up their APIs, both to competitors and start-ups. Regulations to operate by or face astronomical financial penalties.
SAFE AND SATISFIED: A NEW EQUILIBRIUM
New malware software infects mobile phones and computers via websites every day. It's hidden in ads and in apps, and it's maddeningly difficult to guard and fight against. Because of it, banks are on the lookout for a new kind of balance, one that allows them to offer a seamless customer experience while offering payments featuring biometrics, IoT and a high level of security for the user. That last one is crucial, and is as such the focal point of the biggest investments in the industry.
Changes are coming in faster and faster and standards are rushing to meet them. Biometrics will be ordinary as early as 2019. Thus, the need for security is no longer imaginable without machine learning and AI, which are not only already watching financial traffic to detect fraud, but are now also searching the web to gather knowledge on how to fight against it.