Kevin Jenkins, Managing Director for the UK & Ireland at Visa
The world of banking and payments is ever evolving. Buoyed by advances to technology, consumers now have access to a myriad of ways to pay, and the possibilities for the banking sector are similarly diverse. To keep up to pace, banks of all sizes are likely to need to keep their finger close to the pulse and maintain a judicious use of the new options available to integrate into their systems.
At Visa, we believe there are five key trends that will shape the industry this year.
Mobile payments on the rise:The major players in the industry have rolled out their mobile payments apps over the last few years, which means that 2017 will be the year when mobile payments truly take off. According to our Digital Payments Study, 74% of British consumers are already managing money or making payments using a mobile device.
The next step in the evolutionary process will be with the banking sector. Challenger banks have picked up the mantle in offering app-first or even app-only offerings to a generation increasingly wedded to their smartphones. Other players in the banking sector are expected to follow suit in developing and rolling out their own powerful proprietary apps throughout the next 12 months and beyond.
WANT TO BUILD A FINANCIAL EMPIRE?
Subscribe to the Global Banking & Finance Review Newsletter for FREE Get Access to Exclusive Reports to Save Time & Money
By using this form you agree with the storage and handling of your data by this website. We Will Not Spam, Rent, or Sell Your Information.
Shopping moves in-app:As more consumers adopt and integrate mobile apps into their daily lives, retailers are well and truly waking up to the huge opportunities offered by mobile commerce. Many retailers now have mobile apps specifically tailored to the buying process, with a recent UPS study suggesting 80% of mobile shoppers have made purchases using a retailer’s app[i]. They have also started to recognise the opportunities mobile apps provide, not only for increasing sales, but for increasing brand loyalty and improving customer experience.
The role of big data: Last year we saw that the number of Europeans using their mobile devices to make purchases had tripled over the previous 12 months.[ii] As retailers receive an ever-growing stream of information from purchases made across devices, the role of big data will continue to shape how they tailor their offerings to consumers. The ability to act on insights in close to real time through smartphones; for instance the ability to send through special offers as people walk through a store, will further shape the multi-channel shopping experience.
More connected devices: Voice activated technologies such as Amazon’s Alexa assistant, which allows consumers to shop over the internet hands-free will become more prominent. Over eight million units of Alexa’s primary medium, Amazon Echo, were sold between November and December 2016, more or less doubling total sales figures since launch in 2014.[iii]The service has been made free for third parties to develop around and is set to be integrated into Ford cars over the coming year. It is sure to be fascinating to see how readily consumers embrace the ability to “voice shop”, and how this will affect the retail landscape.
More advanced forms of authentication: We’re certain to see further innovations in authentication, to meet competing demand for both convenience and security. Risk based security, in which transactions are evaluated by consumer and merchant behaviour based on risk profiles in real time, has been incredibly successful.
Biometric technology services will also see greater adoption in making face-to-face purchases, with a third (31%) of under 35s in the UK stating that they now find PINs and passwords an annoying step in the payment process.
Whatever happens, there is no doubting that the payments and banking space is advancing at a rate never before seen, presenting challenges and opportunities that have the potential to change the everyday lives of consumers.
At Visa, we are in a perfect position to enable this and help companies innovate. Whichever way I look at it, the future is bright.
[i] UPS Pulse of the Online Shopper report
[ii] Visa Digital Payments Survey, 2016