The risks of standing still in digital payments

The payment process has a direct impact on business success – research shows a direct correla­tion between the quality of the payment experience and the level of transactions the consumer is willing to undertake.

It’s no surprise, then, that the payments industry is evolving fast in response to demand from consumers for an experience that is personalised and seamless, but also secure. Get them right and payments can not only help you retain business but also acquire new business, improving cashflow optimisa­tion for all stakeholders in the payments chain. But if your technology isn’t as agile as your thinking, implementing your strategy will only lead to frustration.

One payment size does not fit all

Digital innovation has seen a decline in cash use and the near death of cheques. And some payment technology common today may also find itself on the path to extinction. This is good: we need to peel a lot of layers away and make the whole interface instant, secure and friendly, avoiding 16-digit number input, passwords and other painful experiences.

Consumers want secure solutions, but they also want simple authentication, not lengthy passwords. They want personalised services that determine the best option for making payments, allowing them to pay for goods and services, knowing each payment is being processed in the most efficient manner for them.

Saying yes to opportunity

Risk assessment is also evolving. Risk and compliance might traditionally be seen as saying no to everything, but technology has given it a new role as an enabler. It’s essential to consider the future needs of customers and ensure the company offers new functionality, channels and/or services in a way that secures both the provider and the user.

The data generated by payments can also be used to make better decisions – not just in risk management but also regulatory compliance and how services are marketed.

E-commerce activity generates vast quantities of data, which can be used to determine a consumer’s credit risk to a far higher degree of accuracy, ensuring consumers are offered appropriate products and services.

Integrate once, benefit repeatedly

Single-click payments, biometrics and other new processes will enable faster and instant payments, providing the data is secure. Companies such as WeChat Pay, Uber and Revolut are leading examples of how to link payments into an ecosystem application or toolbox that will give the user secure and instant access to multiple services.

We’ll also see peer-to-peer (P2P) payment services and more closed-loop solutions enter widespread use, thanks to cost optimisation. Don’t cut up your credit cards just yet though – they’re not disappearing overnight. They will just be pushed towards the “back office” of digital apps, meeting the preferences of the next generation of users.

The opportunity of risk

We’re already seeing behavioural data being used to make specific products available to individuals, based on how they use their mobile device. This will allow the industry to move away from risky card-based decisions.

Artificial intelligence, too, is already being used to evaluate risk. It will become even more widely used, ulti­mately providing the two elements that every merchant needs to provide for their customers: security and convenience.

More demanding consumers will be less tolerant of unwieldy payment processes. Find out more about how innovation in payments can optimise your business and become an enabler for growth, by visiting and downloading the Intrapay manifesto.

Koen Vanpraet, CEO of Intrapay

+43 650 99 12 999


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