EXCLUSIVE- #PayPal wants to move #beyond #payments, according to its CFO John Rainey, who said the company will focus on a combination of partnerships and investments in companies that can propel the payments companies into other areas. Rainey pointed to the PayPal’s recent partnership with investing platform Acorns as an example of this desired move […]
Bank Innovation
EXCLUSIVE – #Kiwibank launched a new mobile feature for its business #customers today, joining the list of many other fintechs and #banks that have unveiled similar #merchant-focused apps and features. Today, the New Zealand bank unveiled Kiwibank QuickPay. This mobile solution lets its merchant customers receive “on-the-spot” #payments — peer-to-peer payments in #realtime. The app, […]
Bank Innovation
EXCLUSIVE – British #payments #network, #Earthport Plc expands to #Bangladesh by partnering with local bank BRAC Saajan Exchange Ltd. The partnership between the two now enables inbound payments into Bangladesh through Earthport’s payment network. The partnership also marks Earthport’s entry into the South Asian country. Hank Uberoi, CEO of Earthport, said in a Monday statement: […]
Bank Innovation
#Norwegian #banks are coming #together to merge their #payments. According to Reuters, the purpose behind this merger is to combat competition from global payment companies, perhaps ones like PayPal or Square Cash to name a few. DNB, banking group Eika, Sparebank 1 Gruppen and others will merge their respective payment systems Vipps (mobile payment app), […]
Bank Innovation
Two #banks have unveiled a corporate cross-border payment solution for real-time #payments, using #Ripple’s #blockchain solution for the network. The solution, which is now commercially available between #Standard #Chartered #bank in Singapore, and #Axis Bank in India, will give corporates “greater control over cash flow,” according to the banks. While Axis Bank corporate customers can […]
Bank Innovation
EXCLUSIVE – Cloud-based payment processing platform, #Dream #Payments is marshaling forces for a major U.S. launch next month. The payments platform, which has been live in Canada since 2016, will go live with one of its payment solution products in mid-December, CEO Brent Ho-Young told Bank Innovation. The solution is Dream Payments’ point of sale product, […]
Bank Innovation
EXCLUSIVE–With global #payments service #SWIFT gpi (global payments innovation) finishing up its first active year, how is SWIFT planning to push the service forward in 2018? The banking infrastructure provider will be moving gpi forward through new partnerships and new projects, most notably API capabilities, Stephen Grainger, managing director, head of North America for SWIFT, […]
Bank Innovation
In “Paradise Lost”, 17th-century English poet John Milton describes two types of warriors: One group are “employed in sporting games and exercises” and “sing in the valleys”, while the other group “rend up both rocks and hills”, “make wild uproar” and “ride the air in whirlwind”.
Milton’s bifurcation also applies to the modern-day #payments industry. With fast-paced disruptive change sweeping the industry, are traditional payment players going through the motions trying to protect their traditional sources of profit or are they willing to be combative and create “wild uproar” by driving radical change?
Consider Accenture’s prediction that in the UK alone there will be between six billion and nine billion contactless card transactions in 2017. Alternative payment mechanisms such as PayPal and iDEAL will continue to grow at 20 to 30 percent a year for e-commerce transactions, driven by convenience and sky-rocketing fraud rates in card-not-present transactions. We estimate that up to 25 percent of banks’ traditional cross-border payments revenue streams are at risk from these innovations. These are just a few of the seemingly endless examples of disruptive change in the payments industry. Traditional payments players are at a crossroad: figure out how to ride this whirlwind to success, or be content to just keep playing the traditional games.
To help #banks make sense of this fast-changing landscape, Accenture has identified ten payments #mega #trends from our 2017 North America Consumer Payments Pulse Survey.
One key trend is banks’ new-found enthusiasm for collaborating with digital consumer-to-business and #fintech partners to both exploit the power of an exponentially growing network and deliver benefits to customers. Tapping into these networks allows payments players to multiply capabilities and extend their reach without building and investing from scratch. One example is Zelle®. This API-enabled network of more than 50 partners, including Ally, Wells Fargo, Bank of America and JPMorgan Chase, offers real-time, person-to-person payments and disbursements through one recognisable brand. According to Zelle, some 85 million consumers can now experience its services through the mobile banking apps of the Zelle Network® participant banks. The app quickly ramped up to $ 33.6 billion in network volumes and 100 million transactions in the first half of 2017. This scale gives participating banks the edge they need to compete effectively with challengers like Venmo from PayPal. Creating and capitalising on network effects require banks to participate in digital ecosystems beyond their own walls and be willing to subsume to some degree their own operating models, cultures and strategies. Just as the payments industry of 50 years ago was energised by the emergence of the credit card networks, we are now seeing a new set of digital networks emerge that also have the power to reshape payments.
Another critical trend driving the #future of payments is the democratisation of payments acceptance. Today, everyone can be a merchant and every device can accept payments, whether you are talking traditional point-of-sale, online or mobile. Enabled by new entrants like Stripe and Square, all it takes is connectivity, a portable card reader or a website to create the next-generation POS. This “payments everywhere” wave that enabled small merchants and peer-to-peer commerce has also created new growth opportunities for payments players; they can address such increasingly attractive markets as large merchant payment margins get more compressed. This democratisation of payments acceptance has also created new opportunities for analytics-based lending and data monetisation strategies, which also offer new and appealing revenue streams for payments players.
These are just two of the ten payments mega trends identified in our recent report, Driving the Future of Payments: 10 Mega Trends, and I encourage you to explore the other eight. Regardless of what type of payments warrior you are, we hope this report can help you ride the whirlwind to the future, as simply singing in the valley is unlikely to be a successful long-term strategy.
The post Ten mega trends that will drive the future of payments appeared first on Accenture Banking Blog.
#Payments are becoming real-time #around the #world, although the U.S. and Canada have lagged.
Financial Technology
In #part one of my blog on atomizing #payments, I explained how payments volumes are likely to expand 25 times or more in the future, resulting in trillions of new payments. In part two, I explain a precedent for this #atomization and its implications, and how the payments industry needs to prepare.
Atomization of communication is a precedent. Nowadays, communication is dominated by e-mail, texts and social media posts in volumes that dwarf those of the past using paper. Individuals typically send and receive hundreds of texts and e-mails each week, compared to a few letters in the past. It has taken about 20 years to reach this state, and volumes are still growing.
If atomization of communications is replicated in the payments industry, trillions of payments can become a realistic prospect. The implications are far-reaching.
Kevin Hanley at RBS recently gave a great Finextra interview in which he talked about the divergence between technology changing exponentially and industries, organizations and individuals thinking linearly. Payments is an industry changing exponentially, however, much of it remains in a linear mode, underestimating the impact of this change. For example, earlier this year, at a conference I was rebuked for forecasting UK contactless card volumes would rise from three billion in 2016 to six to nine billion transactions this year. A member of the ATM industry, passionate about cash, described my forecast as irresponsible. However, UK Finance figures already show the country is clearly on track to exceed six billion contactless transactions in 2017.
My point at the time was that no one is predicting these volumes, or planning for them, yet they are happening. The payments industry is sleepwalking towards its future. The industry needs to think and act exponentially, and it needs a vision. A 25-times increase in volumes over 30 years is only an 11 percent per year compound growth rate—a rate that the world-leading UK Faster Payments system has exceeded consistently for many years.
We are already in an exponential payments world. The good news is that innovation and change in payments will be sustained for many years and the responsible action to take is to embrace it now.
My thanks to Nick Caplan, Chairman of Faster Payments Scheme Ltd for the inspiration behind this blog.
The post The atomization of payments: Part two appeared first on Accenture Banking Blog.
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