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A mobile payments Q & A with Chris Dunne of VocaLink

With each new iteration of technology comes the ability to carry out a wider set of transactional services when it comes to mobile banking, payments and commerce – could the lack of standardisation & compatibility become a barrier to adoption?
The biggest barrier to mobile payments adoption is reach – the ability of a payer to get the funds to the payee.  There are literally scores of closed loop systems that are unable to gain significant market share and then fail, due to the difficulty in getting a payment to someone that isn’t part of that particular ‘club’.  Open standards and compatibility between systems can help to overcome this.

Do you think the emerging popularity of mobile could be the trigger for organisations to implement a more flexible payment platform?  One that enables them to adapt to changing conditions with agility?
Changing payment platforms is costly, painful and frequently disruptive.  Mobile alone will not be the trigger for change but it can ‘tip the balance’ for organisations looking to implement changes to an existing platform, or buy a new platform.

With so many “non-traditional” players entering the payments market to offer bank services – will the question of security (already a concern in traditional environments) become amplified? What is industry doing to counter consumer concerns?
Security is one of the key differentiators for banks – according to research we have undertaken, whilst many people do not like their bank, they do trust their bank to keep their financial details secure.  The challenge is to balance security with usability.  Bank systems tend to be heavy on security at the expense of the user experience, new entrants are frequently the opposite.  According to our research, security is the number one worry for people regarding mobile payments.  There is no ‘silver bullet’ for this – a combination of multi-factor security along with user education is needed to keep security worries to manageable levels.

There are still retail banking services that will be better serviced through telephone, internet or in-person banking – how does the mobile proposition plan to compete?
Mobile is not a panacea; very few people will apply for a mortgage using their phone for example.  Mobile has its uses but there will always be a place for online and in-person banking, and telephone banking for specific sectors.

Near field communication (NFC) is one technology that opens up the possibility of tapping or waving a mobile to pay for goods, but trials have still yet to trigger mass commercial rollouts – what are the factors hindering this?
NFC does have its uses but it is very difficult to build a credible business case that delivers value to merchants, acquirers and others in the value chain.  I remain extremely sceptical about the mass-market potential for NFC.

Payments Expert

ACI Worldwide powers electronic payments for financial institutions, retailers and processors around the world with its broad and integrated suite of electronic payment software.