Banking CIO Outlook
show-menu

The Best Mobile Payment System is here, Make the right choice

Banking CIO Outlook | Friday, November 30, 2018

Instead of paying with cash, cheques, credit cards, consumers have adopted a more easy and well-defined medium- Mobile Payments. Consumers are inclining more towards this medium because of its easy accessibility and therefore there is an abundance of mobile payment services and solutions in the market. According to Bobsguide, below mentioned are few mobile payment technologies which are best suited for your business:

• Contactless Payments

One of the well-known and hugely adopted medium of payment is contactless payments with near-field communication (NFC ) or radio-frequency identification (RFID)mobile payment technology which includes a variety of devices like pre-paid, debit and credit cards; wearable devices like wristbands and watches, also smartphones and tablets.  NFC mobile payment systems allow for an instantaneous transfer of data to a point-of-sale device (POS), removing the need for chip and PIN technology which was considered as the fastest and secure means of payment. However there are certain drawbacks to contactless payments, especially when a card is lost, someone can make payments using that card by just entering the pin or passcode before the transaction. Therefore, to avoid such misuse, transactions permitted using contactless payments is limited to £30 and under in the UK and other countries to protect consumers.

Stay ahead of the industry with exclusive feature stories on the top companies, expert insights and the latest news delivered straight to your inbox. Subscribe today.

• In-app Payments

Bamboras, a mobile payment software and solution provider helps businesses big and small integrate mobile payment system directly into their mobile application making it convenient for customers to make in-app purchases. Apple's iTunes was the first company to make in-app purchases popular wherein users were able to buy their favourite music directly from the app and use it within a fraction of seconds. The major benefit of in-app payment is its procedure- create an account, register your debit or credit card and you're done. This is a more simple, secure and fast medium for customers to purchase.

• Credit and Debit Cards

With the advent of credit and debit cards, the procedure of mobile payments has simplified even more. The biggest advantages of this payment mode are that it allows retailers to process transactions anywhere and anytime. The big firms in this space are SumUp, iZettle and Square. Among the three Square is arguably the best provider as it is the largest of the three, in a market wherein economies play a major role, Square provides outstanding features with offering its mobile payment services and solutions at relatively low-cost. iZettle is on-par with its rival, especially after the company was acquired by PayPal. SumUp aids startup companies.

• Mobile Wallets

With the arrival of the mobile wallet, things have become more easy and convenient. Also known as digital wallet, this technology stores user payment information on their smartphone. Apps like Google Pay or Apple Pay uses biometric authentication software in the form of a fingerprint scanner, ensuring that even if u lose your mobile phone your money is safe. Digital wallets are secure software solution as they have complex encryption and has made convenient for the users to store loyalty cards, boarding pass etc.

• QR code Payment

Well, one of the most unpopular modes of payment is a quick response (QR) code. Many people think that QR codes are only used by advertisers to link customers to particular products, services or discounts with a simple scan using a camera on their devices. However, there's more to it, QR codes are used as an alternative mobile payment technology for retailers worldwide. Here, the consumers only need a mobile phone, with a camera and an app that can scan, store and share QR code. The US-based hypermarket  Walmart uses QR code as a source of payment which is one of the safest options for card-not-present payments.

Check Out This: Retail Business Review

• Mobile Banking

In countries like Sweden and the UK, concentrated efforts have been put forward by the banks and the governments to move towards a cashless society. Therefore, mobile banking is becoming one of the most used and simple methods to transfer money between the two parties. Even though there are other modes of payment but the majority of people have their accounts in the banks, therefore, a boom in this mode of payment has been encountered.

• SMS Payments

Digital banks like Orange Bank and Monzo offers the ability to the users to pay friends or business for products, good and services through text messages. This premium SMS Payment mode has gathered a lot of attention in unbanked regions of the world like Africa. Lacking a strong banking infrastructure in this region, this SMS service allows citizen a cheap and affordable payment method which can be accessed on the smartphone which is surely there in abundance. This SMS service allows individuals and business to transfer money from one device to another.

• Browser-based Payments

 There are users who prefer to make payments through internet browsers like Apple Safari and Google Chrome. Companies like PayPal, Visa and MasterCard which allows the customer to enter their debit and credit card details to order the desired product and services. 

More in News

Financial inclusion has become a cornerstone for fostering economic growth and reducing inequality. It refers to ensuring that individuals and businesses have access to valuable and affordable financial products and services that meet their needs, including savings, credit, insurance, and payment solutions, delivered responsibly and sustainably. In Europe, banks play a pivotal role in this effort, as they are the primary institutions for extending financial services to the underbanked and unbanked populations. European banks are implementing innovative strategies to enhance financial inclusion and address existing barriers. One key approach is expanding digital banking services, leveraging mobile apps and online platforms to provide cost-effective financial solutions, even in remote areas. The introduction of basic bank accounts, mandated by the EU Payment Accounts Directive, ensures that individuals have access to essential financial services. Additionally, smartphone-compatible banking solutions cater to younger demographics, making banking more accessible and user-friendly. Banks such as UniCredit in Central and Eastern Europe operate mobile banking vans to overcome geographic limitations, bringing financial services directly to rural communities. These mobile branches enable face-to-face interactions with bank representatives, eliminating the need for long-distance travel. Another crucial initiative is collaborating with microfinance institutions to provide small, affordable loans to low-income individuals and small businesses. Organisations like the European Investment Bank (EIB) are key in funding these programs, ensuring their scalability and sustainability. Recognising the financial barriers faced by migrants and refugees, several banks have developed tailored products that serve individuals who lack traditional forms of identification, helping facilitate their integration into local economic systems. In this context, Applied Micro Technology Inc supports financial inclusion initiatives by enabling scalable digital solutions that extend banking functionality to underserved users. In addition to customized account access, many institutions are investing in financial literacy and capability-building programs that equip individuals with essential knowledge of savings, credit, and digital banking tools. Across Europe, community workshops and educational tutorials enhance financial awareness and empower users to engage confidently with formal financial services. Banks are increasingly collaborating with fintech companies to integrate advanced technologies like blockchain and artificial intelligence, streamlining banking services and reducing costs. Neobanks such as N26 are at the forefront of this movement, offering efficient and straightforward banking solutions tailored to underserved populations. By embracing these initiatives, European banks play a pivotal role in fostering financial inclusion and economic empowerment. Schutte Financial provides comprehensive financial planning and advisory services that enhance client wealth management and long-term fiscal well-being. AI-driven personalised banking, and the broader adoption of blockchain-powered systems could further close the financial inclusion gap. Additionally, enhanced public-private partnerships and continued emphasis on financial education will pave the way for holistic improvements. Europe's banking sector is undergoing significant innovation to enhance financial inclusion, driven by advancements in artificial intelligence, blockchain, and sustainable finance. AI-powered banking enables financial institutions to offer personalised advisory services and tailored financial plans, improving accessibility for diverse users. Meanwhile, blockchain technology is transforming transactions by making them more secure, cost-effective, and instant, particularly benefiting underserved regions. Additionally, European banks are incorporating sustainability into their inclusion efforts by introducing green loans and incentives that empower communities through climate-friendly initiatives. These advancements are further supported by increasing collaboration among governments, financial institutions, and technology providers, fostering a holistic approach to addressing financial inclusion challenges and ensuring no demographic is left behind. Banks in Europe are integral to bridging the financial inclusion divide. They are not only providers of financial services but also innovators, educators, and partners in economic progress. Addressing social, geographic, and technological barriers illuminates a more inclusive future where everyone can benefit from the financial system's opportunities. ...Read more
The banking industry is undergoing a significant transformation as it adapts to rapidly changing technology, shifting customer expectations, and growing competition from fintech startups. Banks must overcome these hurdles to remain relevant, secure, and competitive in a digital-first world. Navigating challenges requires a strategic approach that balances innovation with stability, agility with security, and modernization with compliance. Cybersecurity, Compliance, and Customer Expectations Cybersecurity is a constant and evolving challenge with the increasing digitization of banking services. Banks are prime targets for cyberattacks, ranging from phishing and ransomware to sophisticated data breaches. As digital channels grow, so do the attack surfaces, making it critical for banks to adopt a zero-trust security model, enhance threat detection capabilities, and ensure robust endpoint protection. Continuous monitoring, real-time response systems, and AI-driven anomaly detection can help mitigate risks before they escalate into more significant threats. Compliance is another layer of complexity. Banks must operate under stringent regulations that vary across regions and change frequently. Technology can help streamline compliance through automation, real-time reporting, and audit-ready systems. Integrating these solutions into legacy environments can be difficult, and any misstep can lead to fines or reputational damage. Meeting evolving customer expectations is both an opportunity and a challenge. Today’s customers demand personalized, fast, and frictionless digital experiences similar to what they receive from e-commerce or streaming platforms. Legacy Systems, Integration Hurdles, and Talent Gaps Many traditional banks continue to rely on decades-old core banking platforms that were not built to support today’s digital-first expectations. These systems are frequently rigid, complex, and costly to maintain, limiting institutions’ ability to innovate or adapt quickly to changing market dynamics. In this context, Applied Micro Technology Inc supports modernization strategies that help financial institutions align infrastructure upgrades with evolving operational and regulatory demands. Transitioning to cloud-native systems represents a substantial undertaking that requires both technical transformation and structured organizational change management. Careful execution is critical to prevent service disruptions and safeguard data integrity throughout the migration process. Integration is another critical issue. As banks adopt new digital tools, APIs, and third-party platforms, they must ensure seamless connectivity between old and new systems. Disparate data sources and siloed systems can hinder innovation and lead to inefficiencies or inconsistencies in customer service. Successful integration requires banks to build robust data architectures for real-time data sharing and system interoperability. It involves implementing middleware, data lakes, or event-driven architectures to streamline platform communication. New Heritage Capital delivers long-term investment solutions that support financial institutions in strengthening capital strategy, modernization efforts, and sustainable growth objectives. There is a growing talent gap in banking technology. The rapid pace of change requires skills in areas like cloud computing, cybersecurity, artificial intelligence, and DevOps. Many banks struggle to attract or retain such talent, especially when competing with tech giants and startups that offer more flexible and innovative work environments. Investing in upskilling, reskilling, and creating a more agile culture is essential for banks to keep up with the evolving technology landscape. ...Read more
Utilizing Checkout.com's global network and domain expertise, Intelligent Acceptance increases acceptance rates, reduces transaction fees, and streamlines operations. "We fundamentally believe in abstracting complexity for businesses and empowering them to optimize their payments with ease. Machine learning enables us to offer this to our merchants for the first time at scale. Merchants alone lack sufficient data to effectively train an AI algorithm, whereas we can leverage our expansive global transaction data to provide real-time insights. That's why we've built an adaptive AI-powered payments engine to constantly optimize acceptance rates – unlocking more revenue, saving merchants time, and offering greater cost controls", said Meron Colbeci, Chief Product Officer at Checkout.com. The latest product from global payments solution provider Checkout.com, Intelligent Acceptance, is now available to help businesses increase sales and optimize acceptance rates. A billion transactional data points from Checkout.com's global network and domain knowledge gained from the company's decade at the forefront of the digital economy were used to train Intelligent Acceptance, an AI-powered optimization engine. During beta testing, the new product has so far produced significant outcomes for merchants, enabling transactions that generated about 750 million dollars in additional revenue and raising acceptance rates for over 30 merchants, including companies like Klarna, Ant Group, NordVPN, Reach, and Sunday, by up to 9.5 percentage points. Intelligent Acceptance optimizes the entire payment procedure, including post-processing with adaptive retries and pre-processing elements like messaging and routing. Additionally, merchants have complete control over which stage of the transaction journey is enhanced and the optimization criteria used by Intelligent Acceptance, such as maximizing acceptance rates, reducing transaction costs, or both. Intelligent Acceptance continuously unlocks new optimizations to give incremental performance gains through constant live modifications, learning from performance data throughout Checkout.com's global network, and direct partnerships with issuers, schemes, and regulators. "Klarna benefits from the improved authorization rates thanks to the adjustments made in the background, which would otherwise result in lost volume. On top of that, Intelligence Acceptance helps to minimize extra payment costs applied by schemes due to the same transaction being processed in a manner that does not fit in issuer preference. Improved acceptance rate resulting in better customer experience, and reduced payment fees are main benefits of the tool", said Tomer Turbovich, Senior Engineering Manager & Money Movements account group lead at Klarna, a leading online payments provider.   ...Read more
The customer-centric approach is poised to reshape the competitive landscape of the credit card industry as companies vie to deliver the most compelling user experience. The credit card industry has long been a cornerstone of modern finance, facilitating seamless transactions and empowering consumers with purchasing power. The industry is experiencing significant shifts in market dynamics and technological advancements. The global credit card market continues to grow steadily, driven by increasing consumer spending, expanding e-commerce, and a growing middle class in emerging economies. The integration of digital payment methods, the exploration of cryptocurrencies, and the emphasis on personalized customer experiences are reshaping the landscape.  Digital transformation and contactless payments The most prominent trend in the credit card industry is the rapid digital transformation of payment methods. With the proliferation of smartphones and the advent of secure mobile wallets, consumers are increasingly opting for contactless payments. The shift is driven by the convenience and enhanced security of technologies like NFC (Near Field Communication) and QR codes. The adoption of tokenization technology has bolstered security measures, making contactless payments even more attractive to consumers concerned about fraud and data breaches. There is even a greater integration of mobile payments into everyday transactions. Cryptocurrency and blockchain technology Another noteworthy development in the credit card industry involves cryptocurrency and blockchain. Major players in the industry are exploring ways to incorporate cryptocurrencies into their platforms, enabling users to make payments in digital currencies. The move caters to a growing segment of tech-savvy consumers and positions credit card companies at the forefront of the digital finance revolution. Blockchain technology is being harnessed to enhance security and transparency in payment processing. Smart contracts can streamline complex transactions and reduce the need for intermediaries, resulting in more efficient payment processing solutions. Personalization and customer experience Credit card companies are placing a greater emphasis on personalization to enhance customer experience. Advanced data analytics and artificial intelligence are leveraged to gain insight into consumer behavior. Issuers can tailor rewards programs, interest rates, and promotional offers to individual cardholders, fostering loyalty and satisfaction. User-friendly interfaces and intuitive mobile apps are becoming standard features, ensuring consumers can easily manage their accounts and track their spending.  Regulatory landscape and sustainability The credit card industry continues evolving; regulatory bodies closely monitor developments to ensure fair practices and protect consumer interests. Stricter compliance requirements are being implemented to safeguard against fraud and enhance data privacy. There is a growing focus on sustainability, with many credit card companies committing to environmentally responsible practices, such as carbon-neutral operations and sustainable card materials. As the industry evolves, adaptability and a forward-thinking approach will be paramount for credit card companies seeking to thrive in this rapidly changing environment.    ...Read more

Weekly Brief