Impact of Technology on Financial Payments. – Henry Skull
•The success of any innovative payment solution will require a strong customer rationale to switch, as most customers do not consider the existing payment regime to be broken.
•In an increasingly cashless future, payment providers who can embrace emerging payment innovations to offer differentiated, value-adding digital experiences will be able to deepen their relationships with customers and take a dominant place in the changing market landscape.
•Reduced control over customer experience: Financial institutions may lose some or most control over their customers’ transaction experience as digital wallets consolidate digital payment platforms.
•Customer targeting: Leveraging data on specific customer segments will become an essential component of strategies to gain a dominant share of wallet among those segments that encourage or drive more frequent usage in a diversified market.
•Merchant relationships: Financial institutions’ ability to partner with merchants will become a critical component of strategies to drive merchant-specific usage, enable merchant-issued credits, or become a preferred card on merchant platforms.
•Competitiveness of bank-issuers: Large stand-alone issuers or network issuers may gain a competitive edge over bank-issuers using their scale to consolidate the market.
•360° view of customers: Issuers that consolidate their customers’ share of wallet will gain visibility into most of their payment activities, leading to valuable data on their lifestyles and preferences.
•Customer retention: As consumers spread purchases over a larger and larger number of cards, the credit card will lose its significance as a key anchor of customer retention for financial institutions.
•Distributed credit: It will become more difficult for individual financial institutions to assess customers’ creditworthiness as their credits become distributed over multiple cards.
•The shift in credit business models: As new credit vehicles displace credit card based borrowing the overall profit models of retail financial institutions will be forced to change.
•Loyalty programs: Financial institutions will need to create new ways to promote customer loyalty as lower fees on bank account transactions disrupt the current credit card, loyalty models.
•Competitiveness of bank-issuers: Large stand-alone issuers or network issuers may gain a competitive edge over bank-issuers using their scale to consolidate the market.
•360° view of customers: Issuers that consolidate their customers’ share of wallet will gain visibility into most of their payment activities, leading to valuable data on their lifestyles and preferences.
•Customer retention: As consumers spread purchases over a larger and larger number of cards, the credit card will lose its significance as a key anchor of customer retention for financial institutions.
•Distributed credit: It will become more difficult for individual financial institutions to assess customers’ creditworthiness as their credits become distributed over multiple cards.
•A shift in credit business models: As new credit vehicles displace credit card based borrowing the overall profit models of retail financial institutions will be forced to change.
•Loyalty programs: Financial institutions will need to create new ways to promote customer loyalty as lower fees on bank account transactions disrupt the current credit card, loyalty models.
•To bring innovations to the traditional value transfer rails, financial institutions must collaborate to identify top priority areas for transformation solve for regulatory complexity.
•Revised margin structure: Margins on the current payment and settlement transactions will need to be restructured as competitive pressure grows from alternative rails.
•Global implementation: Global settlement infrastructure and emerging markets may present the largest immediate opportunities for the development of alternative rails of payment and settlement, given regulatory complexity of developed local markets.
•Changing role of trusted intermediaries: As highly accurate and efficient alternative rail designs are implemented, the role of traditional intermediaries (e.g., payment networks) as a trusted party may diminish.
•Loss of visibility into customer transactions: As more financial transactions are conducted via alternative rails, financial institutions will lose visibility into payment history to asset/loan portfolio aspects of some or most of customers’ finances.
•New sets of risks: As financial institutions participate in the further development and usage of alternative rails, they will face a new set of risks around reputation, security, and compliance that are not under their direct control.
https://www.weforum.org/agenda/2015/06/5-ways-technology-transforming-finance/
Impact of technology on the financial sector
http://www3.weforum.org/docs/WEF_The_future__of_financial_services.pdf
Published at Sun, 21 Jul 2019 23:45:13 +0000
Bitcoin Pic Of The Moment
Bitcoin held in hand
By btckeychain on 2013-08-29 09:16:41
