What will drive payments in 2015?
In 2015, we will see a confluence of internet and mobile based technologies and devices redefining the scope and scale of payments across industry verticals. We will also see more standardizations, consolidation and compliance across devices, channels which will consolidate payments. Here are a few top trends that we feeltttt will dominate 2015.
Mobile first strategy:
Mobile will continue its dominance forcing banks and merchants to adapt mobile first payments strategy. According to a recent report mobile payments will grow by 60.8 per cent to 47 billion transactions through 2015.
Mobile first design will define the payments architecture of banks and financial institutions. Real-time capabilities and scalability will drive the success of mobile payments.
Mobiles will also redefine rural payments space with focus on low cost technologies and devices to gain traction among rural consumers.
The competition between banks, telecom companies and technology companies will push m-commerce to new heights, fuelled by influx of newer technologies such as NFC, BLE, QR codes, social and wearable which will be integrated with mobile payments strategy.
E-commerce will evolve as a standalone industry:
E-commerce will transcend devices and will be fuelled by personalisation and customer centricity. The industry which recorded the first online transaction twenty years ago is now poised to grow into a standalone industry rather than online extension of brick and mortar stores. It is today one of the fastest growing market comprising of multi-national retailers to small time single owner merchants seeking global opportunities. Starting this year, we will also see a gradual merger of e-commerce and m-commerce as more and more will shift to mobile devices. Success of e-commerce will ride on personalization, socialisation and localisation. Flexibility will be critical as the rules of the game continue to change and new technologies crop up each year.
Meeting EMV deadline:
Europay, MasterCard & Visa (EMV) sets the global standard for operation of chip cards, point-of-sale terminals, ATMS, etc. and by Oct 2015, MasterCard, Visa, American Express and Discover have made it mandatory for all acquirers and service providers to have the capability to process any EMP transaction. This will include contact and contactless payments such as card payments and mobile payments. As non-compliance to EMV will shift the liability of risks to the non-EMV complaint entity, there is heightened activity in meeting EMV deadline. There are now 1.24 billion payments cards and 15.4 million PoS terminals currently in use.
Wait and watch continues for Virtual currency:
Virtual currencies or crypto currencies, notably Bitcoin, have recently gained traction as potential investment vehicles. Decentralization, convenience, and transparency are the key drivers for the growth of virtual currencies. In a short span, they have evolved as viable alternatives for traditional investments and existing currencies. However due to decentralisation and transaction anonymity, bitcoins have raised serious security concerns. Some of the limitations that crypto currencies presently face can be addressed through technology. But more regulations and government are likely to attract due to the misuse of bitcoin, will challenge the fundamental of the virtual currency concept. In spite of the unclear roadmap, we strongly believe the virtual currency is here to stay and it is evident from the increasing number of new products launched.
Making Financial inclusion commercial viable:
Financial inclusion is gaining heightened attention across the globe with governments setting inclusive banking and payments as their strategic agenda. Regulators, banks and technology vendors are focusing on innovations around low cost mobility devices, infrastructure and BC driven applications such as bio-metrics, tablets, micro ATMs and mobiles. While rural banking offers huge potential, the key challenge will be to achieve right balance between financial inclusion objectives and commercial viability..