A recent slide deck from BI Intelligence chronicles its perception of the changing global payments industry. As the use of cash for transactions evolves into online and mobile payments, merchants are testing the waters for mobile, wearable and other innovative payment processing options that cater to consumer convenience and heightened need for security.
Writing checks unarguably is an archaic payment method; though more commonly used than checks, paying with cash is also on the outs, with both methods giving way to an eventual paperless society rooted in the rapid advancement in technologies like ecommerce and smartphones.
More people are paying their bills and shopping online, whether by phone, PC or desktop, inherently triggering an increase in the use of credit and debit cards. BI Intelligence reports that 20% of credit and debit transactions take place online rather than in stores – these “card not present” transactions represent CAGR of 15% compared to 4% growth in card-present payments. Ecommerce and mobile commerce take the overall lead with 16% CAGR, boosted by the increasing amount of time consumers spend on their phones.
Recognition of these trends fired the starting gun for a merchant race to develop the most consumer-friendly online and mobile payment options. Tech leaders like Apple, Amazon and PayPal as well as smaller innovative companies are vying for control of the payment processing industry. The BI Intelligence forecasts that as these technologies advance, U.S. in-store mobile payments volume will perform with 154% CAGR within four years to roughly $189 billion.
Data breaches from big name retailers (Target and eBay to name a couple) have also spurred the quest for transaction innovation, and as BI Intelligence reports, venture capital flows like milk and honey for global payments startup funding.
Mobile card readers like Square and VeriFone are on the ups, advantageous to the placement of embedded chips in debit and credit cards for added security. The forecast is that because of these chips, retailers will need to upgrade their terminals anyway, and that mobile card reader sales will proliferate. The use of apps and consideration for wearable payment options are also increasing as merchants try to make transactions easier and for the consumer.
Despite an uptick in equity and technological investments, the consumer trend remains loyal to debit and credit card payment options because of the safety and privacy issues associated with paying via mobile phones. However, there is an ever-increasing the need for safeguards against credit card fraud.
Florida-based payment innovator Mobile Lads, which also has an office in Canada, designs and delivers secure, wide-area wireless transaction software solutions for the consumer finance, web and health payment processing sectors. These solutions are on pace with the broader payments industry, specifically aimed at helping consumers safeguard their payments and mitigate identity theft and/or fraud.
The company’s solutions center on three core technologies that simplify and secure wireless communications: xmVerify, xmBilling, and xmOne.
xmVerify is a real-time mobile transaction security service that requires user authorization of credit and debit purchases. Using top of the line cryptographic services, xmVerify sends a transaction authorization request directly to the user’s mobile phone to ensure authenticity and eliminate credit card fraud. This is ideal for card-not present transactions.
The xmBilling mobile platform provides a convenient and secure way to review and authorize automatic billing transactions. The system sends the user a text message with a URL leading to an online e-bill, which can then be reviewed and paid via credit card with the use of a secure PIN number.
xmOne caters to students and higher education facilities, providing an array of encrypted mobile services such as top-up, payment processing, emergency notification and marketing. xmOne interfaces with a school’s existing campus card account system, enabling students to perform a variety of banking transactions from their cell phones and benefiting the education institution by increasing the usage of the flex-dollar ecosystem and reducing overhead from ADMs.
As the global landscape of payment processing continues to evolve, companies like Mobile Lads that are willing to front the research and development and remain flexible enough to cater to evolving trends and produce innovative and secure options are poised for tremendous growth.
*View the BI Intelligence Slide Deck at the following link: www.businessinsider.com/the-future-of-the-payments-industry-2014-slide-deck-2014-7#-2
For more information on Mobile Lads, visit www.mobilelads.com
Let us hear your thoughts: Mobile Lads Corp. Message Board
