Our own day-to-day experience tells us the cashless society is inching closer.
You’ll surely have noticed growing numbers of people paying even very small sums by card in shops pubs and restaurants.
And the stats support this perception, with the value of payments made electronically surpassing cash payments for the first time ever last year.
But if this process, which has been accelerated by chip and pin and latterly touch-less debit cards, has been in train for many years now, another trend has emerged: the diversification of electronic payment methods.
Reflecting demand from consumers for convenience and speed in online transactions, electronic payments is now a highly innovative area.
Speaking in the Future of Payments & Cross Border Theatre on day one of eCommerce Expo 2015 Gearoid Quigley, Corporate Sales Manager at Realex Payments, walked his audience through the smorgasbord of payment platforms now competing with traditional methods like credit and debit card schemes, real-time bank transfers and direct debits.
Everyone’s aware of PayPal, which has dominated the market it effectively created in 1998 and was recently valued at $52bn.
Accounting for 57% of global alternative payments PayPal should be seriously considered as a payment option by retailers, said Quigley, despite the not inconsiderable costs involved.
JP Morgan analysts have said, however, that “the competitive advantages PayPal enjoyed in the traditional online commerce channel do not necessarily carry over into the mobile and offline worlds.”
Visa, the world’s biggest payments processer and #32 on Forbes Most Innovative Companies rankings, is a serious competitor. Launching its own eWallet – a “secure cross-channel digital wallet” and a “range of customised mobile payments services” for various local markets – the credit card giant is recognising changing consumer needs and future-proofing itself against the perhaps inevitable decline of its traditional model.
Masterpass is Mastercard’s equivalent foray into the digital realm and has been growing 40% a month for the past six months, said the speaker.
Inevitably Google has taken an interest in this burgeoning, mind bogglingly lucrative market. With Android Pay the search giant is taking on Apple Pay and hoping to succeed where Google Wallet – which has had a disappointing take-up among retailers – has largely failed.
Apple Pay, said the speaker, was successfully “leveraging card and mobile devices”. With details of 700 million payment cards stored on the platform it represents a “strong, viable payments method” for retailers.
The iPhone and iPad Touch ID app hugely reduces the risk of fraud, liberating Apple from the need to impose spending limits on customers.
Amazon, meanwhile, has launched Amazon Payments.
Social platforms are muscling in on the action too, with Twitter piloting a scheme in conjunction with biometric payment innovator Zwipe. Only available in the US for now, payment-by-tweet will become possible in the UK and elsewhere should the trial succeed, said the speaker.
Facebook is rolling out a payment function for its Messenger app.
Virtual currencies remain outside of the mainstream, despite the enormous media coverage generated by Bitcoin, though this is an area that will surely grow as trust builds.
Summing up the principle driving innovation in the sector the speaker said: “Cash is no longer king; convenience is.”
The session ended with questions from the floor.
What about text-based payments, said one attendee? There is definitely growth in this area, said Quigley, who apologised for omitting them from the session – which only attested to the sheer number emerging. There simply wasn’t the time to cover everything.
Then asked how and when mobile-based payments might be viable for the low-level sole trader, the speaker essentially said necessity would surely give birth to invention.
Another audience member professed, quite understandably given the dizzying pace of change in this arena, to being confused about the options available and the best course of action to take.
“As a payment service provider we facilitate for our merchants,” said the speaker, who counselled that “you need to listen to your consumers.
“What are they doing? Are they leaving because your payments methods aren’t right for them?”
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