What will the future of payments look like?

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To mark next month’s 30th annual Payments Knowledge Forum conference, PaymentEye caught up with three of the event’s speakers: Nick Telford Reed, the director of Technology Innovation at Worldpay; Brian Cunnington, Business Architect at World Class Payments Project, Payments UK and the futurologist Ian Pearson, Futurizon.

We caught up with them about the current industry landscape, covering topics such as Bitcoin, the rise of contactless and future of cash, as well as getting a preview of the things they will be talking about during their presentations at the event.

 

Making payments ‘more human’

The key theme of the conference is ‘The User Experience’,  so naturally our first question to Dr Ian Pearson, the second keynote speaker, was how he sees that payment feature evolving in the future?

He believes that over time focus will be shifted towards “making payments more human and provides the example of a parent giving money to their children – rather than involving some complex transaction, one just hands over the money and Ian says it would be nice to make future payments as “intuitive” as that.

When asked about his thoughts on the term ‘disruptive’, the buzzword that makes industry experts flinch and grimace faster than rotten eggs, he says it is not the best description for the current state of innovation.

He posits “stimulative technology” is more apposite than ‘disruptive’ because new technology methods don’t “remove businesses” but rather create many more opportunities and stimulate enterprises.

In terms of cash, Ian says, “It will last as long as there is still a convenience factor or a trust factor in play. At the moment people don’t trust electronics completely.”

He also mentions the “beggar in the street test” which asks how easy is it to give £1 to a beggar through various means. If it’s not as easy as throwing a pound into a hat then “we are not there yet”, and he adds that with electronic means, it’s not as easy as giving the physical coin.

 

Cash isn’t going just yet

Payments UK’s Brian Cunnington also suggests that cash isn’t going anywhere just yet.

He believes cash will continue to play an important role in the payments of the future, and that despite the news that cashless transactions have overtaken cash ones for the first time, he points out that “cash remains the most popular payment method by volume, followed by the debit card, which accounted for 24% of all payments last year”.

 His presentation at next month’s conference asks What Does a Future World Class Payments Vision Look Like? and when we asked him what the key features of a perfect experience looked like, he revealed that Payment UK’s analysis revealed 13 important features.

“Open access to the payments infrastructure would enable healthy competition and innovation in the industry which will create the environment for the steady stream of improvements that customers want to see.”

Certain ideas were appealing to different customer groups, something that Brian found particularly interesting. The idea of confirmation of payee was something that had a high level of cross-group agreement.

Brian also highlighted that to achieve a world class payment vision, more control over outgoing payments for customers and enhanced data must also be prioritised. Such features would greatly benefit a crucial part of the economy – small businesses. They would be able to operate much more efficiently “whilst enhanced data would make it possible to provide additional reference information with an electronic payment helping businesses better reconcile payments”.

On the topic of Bitcoin, Brian stresses that international consistency and at a global level is important to ensure that digital currencies do not slip into “jurisdictions that do not have formal regulation”.

“Provided that risks are adequately addressed, digital currencies such as Bitcoin could provide new benefits for customers,” he adds.

 

NFC ‘has a role to play’

Worldpay’s Nick Telford-Reed describes Bitcoin as interesting given its current state.

“It seems to be used mainly for trading purposes rather than traditional retail ecommerce.”

At the Payments Knowledge Forum Nick will be talking about practical payment innovations. He mentions contactless technology, NFC has a role to play in simplifying and speeding up the in-store payment experience”.

When asked how he sees the technology evolving in the future, Nick suggests portable recharging devices with mobile contactless and wearable technology as having a ‘great’ future.

He also adds that ‘high value contactless’ transactions will happen and will drive growth.

“In the UK, contactless is becoming the norm, and Visa Europe’s recent contactless mandate for card issuers is sure to increase market penetration.”

However, Nick agrees with Brian about cash, saying that whilst the introduction of the likes of Apple and Samsung Pay will reduce the importance of cash, it certainly won’t be eliminated.

But it’s not just these technological advancements that will be crucial in the future of payments. The data derived from these digital transactions is becoming as important as the payment innovations themselves, Nick says.

He states that analysing and understanding how consumers shop, in-store, online and increasingly on their mobile devices is incredibly important as “as it allows us to develop a range of payment products and services that reflect the ever-evolving Omni-channel consumer journey.”

Nick will be talking more about this necessity to build things customers actually need at next month’s conference.

In his position as the director of Technology Innovation, Nick will also be talking about the actual process of innovating. “We are going to talk about the realities of innovating inside a large organisation.”

 

Payments Knowledge Forum’s 30th annual conference will be taking place on the 5th-6th October, 2015 at One Great George Street, Westminster.

For more information about the Payments Knowledge Forum 2015 and the speakers, visit the conference’s website.

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