Digital payments will be witnessing new evolving trends in the coming months. The user base for the global mobile payments market is growing with each passing year. From 70 million in 2009, it is predicted to reach 384 million by the end of 2015 (Source – www.slideshare.net). In terms of the global value, it is predicted to reach $472 billion by 2015. Experts suggest that the next big thing in digital payments would be payment on delivery through mobile. Working on the lines of the older brother COD (Cash on Delivery), this development would surely stir a revolution in the digital payments market. Other than this, there has been major developments in the digital payments sector over the past 4-5 years. Following Naspers, who backed entrepreneur Nitin Gupta to set up payment firm PayU in 2011, earlier this month, One Mobikwik Systems announced a $25 million funding round with Cisco & American Express coming in as new investors. The entry of Apple Pay and Google Wallet sends a clear indication about the huge potential of the digital payments market. Here’s an infographic that sheds light on the digital payment trends.
However, the banks need to properly formulate and execute new digital payment strategy by inculcating some old points to tap the potential of this market. Here are a couple of aspects that will continue to play a pivotal role in right formulation of a digital payment strategy. These aspects will enable banks to define right propositions & proposition roadmap.
The Role of Remote Control Handsets to Get Bigger
Mobile wallet introduction has been under major focus recently. However, the key challenge is to address the “all consumers, all merchants” motive. Banks have been enabling consumer accounts to be used in all digital interactions and operate on all digital channels. Account-driven payments will play a major role in upcoming innovations in the digital payments market. Mobile handsets and tablets that are being used as a remote control device for a bank account in all online transactions are poised to get bigger. Banks should come up with new propositions that allows lag-free usage, along with safer consumer protection. This proposition should align with the consumer protection regulation at all points. This is where banks can provide value beyond traditional payments, online payments and generate new profits.
A Rollout of Unexplored Industry-wide Solutions will hold the key
With so many industry-wide solutions coming into the picture, the market is getting competitive with each passing day. However, in order to gain more profits, banks must focus on rolling out unexplored and new-age industry-wide solutions. A retailer would always appreciate a solution that has an industry-wide reach rather than one that can be used by customers of a single bank. It is important to identify the needs and dynamics of every particular ecosystem. This can be achieved by the encouragement to create partnerships with complementary organizations. This process can help the banks to reflect both the retailer-centric and consumer-centric needs alike. Developing new-age industry-wide credentialing solutions designed to help improve the future safety and soundness of digital payments will provide a safer solution that meets the broadest set of end user needs.