Payments Buzzwords Bingo: Mid-Year Report Card
Summer is in the air (and it’s 95 degrees this week!!). As we move properly into ‘flip-flops and shorts’ season in the North East, it’s about that time to check in on our annual calls from the New Year (and begin to look forward to counting down to the next set of predictions). Hard to believe that 2017’s Christmas is now closer than 2016’s, but so goes time, and nobody can slow that down. So without further ado I give to you… the mid-year trends update!
We closed out last year with five main trends to watch: Open APIs, Blockchain, IoT, Mobile Payments and Ecosystem. Let’s dig into what we said on each of these.
#OpenAPIs Banks go live with #PSD2 solutions ahead of schedule! Focus shifts to internal innovation and new product packaging and solutions.
Status: On Point: PSD2 is basically the topic du jour in Europe (when we remove politics from the conversation). I think the second half of this prediction is also looking to come to fruition, albeit less bullish than the go-live call. January 2018 will be here before you know it!
#Blockchain at the center of growing volume of international payments. YoY CAGR exceeds 500%. Investment in PoCs and alliances continues growth.
Status: Trending Green. I will say this about blockchain and distributed ledgers; they still grab headlines every time they are mentioned. While the luster has worn off slightly, the potential of this technology to bring massive change to our industry is still there. Now that the hype is dying down, I can’t wait to start seeing use cases in action and volumes begin to grow. For now, I am going to keep my prediction intact.
#IoT #connectedlifestyle Fraud concerns don’t allay adoption as payments via connected devices take off. Virtual Assistants, the new norm!
Status: Trending Yellow. IoT dominated the early part of the year with its strong showing at CES. The number of Amazon Echos and Google Assistants that are shipping monthly are staggering, however the acceptance by consumers of actually transacting on these devices is still in its infancy. For now, we are hearing a lot more inquiries about the weather than we are about making a purchase. I remain bullish on this, however, timescales may be slightly off.
#MobilePayments continue slow slog toward mass adoption; #OpenAPIs at center of growth through #mCommerce and in-app purchases.
Status: Trending Green. We are now over two full years post-Apple Pay launch and the mobile payments space is still waiting to take off like the rocket ship many of us expected. As I have said in the past, I think we put some unrealistic expectations on a technology that is so dependent on ubiquity and acceptance. The past two years has seen great growth in the Payments space and the focus from the tech giants and FIs alike make this an area that we all need to keep a watchful eye on because when this trend tips, it will tip hard. Maybe Europe will lead the way in their post-PSD2 world!
#Ecosystem Traditional competitors work together in sandbox to create net new payment value chain workflows with real time at the center.
Status: Too Early to Call. I’ll take a page out of the political watches handbook here. The New Payments Ecosystem is something to which we all need to pay the closest attention. Each of us (in the payments ecosystem) is entering a new world, be it post-PSD2, post-disruption, post-digital transformation or [insert another buzzy sounding term]. At the heart of this are the changes that are happening from the outside in, and the old business models that we have operated in will be unrecognizable. It’s both exhilarating and frightening, but no matter which way you look at it, opportunities abound.
Related Blog Posts
Slam the Brakes on Gas Pump Fraud and Rental Car Scams This Memorial Day Weekend
The process of secretly reading data off credit and debit cards (aka skimming) could be netting criminals as much as $3 billion a year in the US, according to Bankinfosecurity.com.
As we look forward to Memorial Day weekend here in the U.S., travelers are getting ready for road trips to their favorite destinations. Whether it’s a beach party in Miami, snorkeling in Catalina Island, or even a staycation, payments – and more specifically, payment fraud – is a huge consideration for travelers, especially during the holiday weekend. I sat down with one of our payments fraud experts, Seth Ruden, to talk about what travelers must look out for regarding payment fraud and how they can keep their money safe. Here’s what he told me.
Cutting the Cost and Complexity of Merchant Payments – But Not the Customer Experience
New research from ACI and Ovum, released this week, highlights that many merchants in 2018 are investing in creating operational efficiencies in their payments systems. But the question is, as they strive to simplify systems and cut costs, will customer experience suffer?
Despite the Hype, Machine Learning, Models, Behavioral Profiling and the Customer Experience are Still Fundamental
Think about the last time you got a fraud decline. Where were you? In the grocery store? Buying airline tickets? On holiday? Shopping in the same place you’ve been a dozen times, but across the border? How frustrating was that, what did it do to your perspective, your mood, your confidence in your financial institution? This can be embarrassing and inconvenient, stressful and alarming for the consumer. There are few things that can be more disruptive in our day-to-day lives then the lack of access to your funds, or the care taken by your financial institution after a fraud occurs. According to ACI’s Global Consumer Fraud Survey, 20% of people may decide this is too much and move along to another financial institution.
Cross-Border eCommerce Expansion: A Fraud Perspective
For merchants that are expanding their online presence overseas, enabling the right locally-preferred alternative payment methods and connecting to local acquirers can be a critical determinant of success. But without considering fraud management strategy in tandem with payments strategy, the road to cross-border success could be a bumpy (not to mention costly) one.
The 12 Biggest Security Threats to Payments
Consumers ask a lot of you in terms of convenience, speed and, above all, security. This puts the pressure on you to offer a pain-free consumer experience that is also highly secure. And when you accept payments, you need to secure all parts of your organization. Here’s an actual example: one major breach occurred when an air conditioning vendor was hacked, allowing hackers to access the corporate network and finally the point of sale network. This highlights the importance of understanding the threat landscape we face today.
Maintain Vs. Invest: What the Digital Era Ushers in for Banks
Taking place this week in Brussels, the European Credit Research Institute (ECRI) will host a high-level debate on how policymakers can build on the process of digitalisation of banks to raise competitiveness in light of increased competition from fintech start-ups and tech giants.
Ursinus College: The Future of Campus Commerce is in the Cloud
Sixty-eight percent of schools are moving eCommerce to the cloudi. As Ellucian Live begins to descend upon San Diego this week, ACI’s Gene Scriven took a moment to chat with Ellen Curcio, Director of Student Accounts at Ursinus College, about the future of campus commerce.
Be sure to catch Ellen and Gene, as well as ACI partner and host Ellucian at the event on Wednesday, April 11, for a panel discussion on “The Future of eCommerce in the Cloud.”
Fraud Awareness Month Canada
A couple years ago, I penned a blog post to commend the Canadians on what made their culture so resilient to fraud that it developed the lowest fraud rates in the Northern Hemisphere. It got a bit of circulation and created significant positive feedback. This time, I would like to bring awareness back to Canada about a potential threat as it relates to the increasingly popular Tap payment channel.
Telcos Have a Unique Opportunity to Drive Mobile Payments
We are witnessing a significant and inevitable shift in digital payments towards mobile commerce. In the next ten years, we will see an exponential expansion in the number of devices and applications we will use to make mobile payments. You could pay for your groceries on your mobile, for delivery at home, then two days later receive a message from your fridge alerting you that the milk is running low. By the time you get back home, a new bottle of milk could be waiting for you, thanks to real-time delivery, even by a drone.
Securely Growing Online Sales in 2018: An Australian Perspective
Back in November 2017, I participated in a panel discussion for NORA (National Online Retail Association), where I looked at fraud trends in Australia over the previous holiday shopping season and made predictions to help retailers prepare. Now looking back, I am sorry to say that my predictions were painfully accurate.