The Future of Payments

Digital disruption is rocking the payments industry. For banks, card networks, and processors, the digital revolution is bringing new opportunities — and new challenges. And for consumers, the digital revolution is providing more choice and making lives easier. The global payments ecosystem is constantly changing as new startups try to change the way we move money around the world. Mobile wallets and the increased importance of card security to reduce fraud are some of the major trends that are shaping the future of payments processing.

Digital Commerce

Digital commerce is no longer restricted to computers or smartphones. There are now a plethora of things, including connected devices, appliances, devices, clothing, fashion accessories and sensors, all with the potential to disrupt commerce and usher in new payment form factors. Consumers also are shifting from type to voice interfaces with personal assistants powered by the established smartphone and emerging wireless speaker categories driving this uptake. Euromonitor International estimates that nearly 81 million wireless speakers, such as Amazon Echo, will be sold globally in 2017, with that category expected to expand 84% from 2017 to 2021.

As a result, payments are becoming more of a commodity in the commerce experience. Consumers expect frictionless checkout experiences combined with the same level of security across all devices as exists today with other more established payment forms.

Mobile Wallets

Mobile wallets could be the single biggest transformation in payments processing if they take off in the way that many analysts expect.

Retailers are particularly excited about mobile payments because they can offer valuable insights about customer transactions that companies can use to enhance the shoppers’ experience. The speed of mobile payments can also help increase foot traffic in stores, which in turn would generate more sales.

In 2014, Apple was the only major mobile wallet on the market. But in 2015, Google and Samsung launched their own mobile wallets, and Walmart, Chase, and other major players joined the market. BI Intelligence, Business Insider’s premium research service, expects in-store mobile payment volume to grow from $75 billion in 2015 to $503 billion in 2020.

Artificial Intelligence

While companies have been collecting petabytes of data for years, the reality is that most struggle to make sense of it all. At its lowest common denominator, artificial intelligence (AI), allows brands to better synthesise data and incorporate those learnings to improve the commerce experience. AI, which refers to technologies capable of performing tasks normally requiring human intelligence, goes back centuries. While AI technologies were commercially available by the 1980s, it was not until the turn of this century that the emerging machine intelligence trend truly took off. Now the confluence of three powerful drivers, including exponential data growth, more sophisticated distribution networks and smarter algorithms, have propelled artificial intelligence to the centre stage.

Artificial intelligence is likely to transform many industries in the next decade, including payments. Dr. Matt Wood, the director of deep learning for Amazon Web Services, spoke at Money20/20 about how Amazon and its AWS clients use artificial intelligence to help inform decisions from fulfilment and logistics to personalisation to fraud prevention. Capital One, for example, deployed chatbots to allow consumers to conduct basic account inquiries, including the status of balances and transfers between accounts. Liberty Mutual offers similar functionality with the addition of fraud risk prevention. Expedia incorporates machine learning, which continues to take in new information to become smarter over time, to display more aesthetically pleasing user photos alongside its consumer reviews. Logistics company Instacart uses machine learning to memorise grocery store layouts in order to provide its delivery personal with the most efficient routes to complete order assembly. “Machine learning is becoming the future of growth,” Wood explained. “The more that companies invest in machine learning, the more they grow.”

Digital Remittance

Migrants have been sending money to their families and friends in their home countries for decades, but the digital shift is making that process easier than ever. And while digital still just holds a small portion of the global remittance market, growth at digital startups is tremendous.

In 2014, $583 billion were remitted across borders in 2014, and the World Bank expects that number to climb to $636 billion in 2017. BI Intelligence notes that digital accounted for 6% of all remittances in 2014.

But digital’s share is growing thanks to the work of startups. Xoom, founded in San Francisco in 2001, grew 53% between 2012 and 2013 and 30% between 2013 and 2014. It now makes more revenue from digital than legacy company MoneyGram, the second-largest remittance company in the world.


Thus far, 2017 has been a landmark year for the payments industry, thanks specifically to emerging payments technologies.

Mobile wallets have flooded the market. Consider that Apple Pay was the only major mobile wallet in 2014, but now Android Pay, Samsung Pay, Chase Pay, and Walmart Pay have all debuted and are thriving in their own ways.

At the same time, mobile commerce has matured as smartphone manufacturers have started to create devices with larger screens and payment companies have added one-click buy buttons in order to remove the friction of shopping on mobile phones.

Alternative technologies and currencies are now poised to disrupt the payments ecosystem and change the way we think about—and interact with—money.

Watch this space.

If you’re an experienced leader in the payments industry, either within a large established player or with a dynamic startup, we may have an opportunity for you. Follow this link for all available senior payments positions.


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