As the variety of payment options on offer expands each year, companies need to be aware that consumers are fickle creatures. At the close of 2011, leading UK newspaper The Times published an issue of the Raconteur supplement on the future of payments. In it, they gathered representatives from five key players in the payments space: Gemalto, O2, KPMG, PayPal and VisaEurope.
MD of Gemalto in the UK, Howard Berg raises the point that the companies meeting the expectations of new internet generations will enjoy first-mover advantage. He says: “The boom in virtual payments is the single biggest opportunity for companies today. This is because of the sheer number of consumers that run their lives over the internet or on their mobile while on the move.”
We spend money in one-click transactions, so why shouldn’t we bank it in the same way? The simple movement of funds across a variety of mediums is likely to be the difference between banks that succeed and banks that thrive. A bank is after all, a business like any other and in personal finance; people often only switch banks when they experience dissatisfaction.
The future for established names looks positive in 2012 as NFC smartphones continue to populate the worldwide market. Smaller cogs in the wheel of mobile banking are likely to be snapped up early if they prove profitable, whilst historically, consumers have proven reluctant to trust unknown innovators in finance.
This February, The Sunday Telegraph (UK) published a Lyonsdown report on digital money asking if we are witnessing the end of cash. In the Business Technology paper Sue Tabbitt discusses whether mobile payment will remove our last connection with hard cash, prompting the UK to become disenfranchised – like OAPs using cheque books instead of direct debit and therefore paying more for their energy.
As in most reports on mobile payment, the ‘Apple factor’ and the Olympic Games are set to provide valuable insight into what consumers think. But what’s of interest to me is how many banks have chosen to market ‘payment innovation’ as time saving, as opposed to money saving. In reality, having a credit card as an application on a phone may help us curb spending by eliminating the middle men.