Today, we are becoming cashless as a society. We receive, store, pay, transfer, borrow, lend and invest via mobile phones. Mobile remittance apps also enable people to send money to each other easily and conveniently. While we have talked about the rising popularity of mobile payments and what we think main industry players can do to keep that trend in the right trajectory, it is not enough to just learn from the past and live in the moment. We must predict the future, and that leads us to this.
Here are five key trends shaping the future of mobile payments.
Rise of social commerce
Today, tech-savvy business owners are looking into social commerce to expand their reach as people are spending more time on social media platforms. Improved system development and integration is giving birth to a slew of social commerce apps capable of performing complicated transactional tasks. Business owners and money transfer operators would do well to make it easier for customers to make payments via these social commerce platforms, which can then boost their product reach and growth.
Artificial Intelligence (AI) to be more prevalent in payments
Artificial Intelligence (AI) allows businesses to process huge quantities of data of customers to identify spending patterns with a greater accuracy. As a result, AI is used by businesses to plan targeted promotional campaigns to enhance their interaction with customers and enterprise planning which will lead to better efficiency in generating sales and implementation of cost-control measures in the future.
Also, AI can be used to combat theft and fraudulent transactions by improving mobile payment systems. Hence, as AI continues to improve, it will improve security for mobile-based transactions. However, fintech is inherently a complicated industry, with lots of moving parts and different regulations.
AI payment needs more major breakthroughs to fulfill its vast potential, but the technology is gaining ground.
Biometric payment to reduce online fraud
According to a Biometrics Study conducted by Visa in 2017, biometric methods of authorising payments such as fingerprint recognition, eye scan as well as facial recognition are viewed to be more secure than the conventional passwords, security questions and signatures. In addition to better security, the research shows that consumers would prefer biometric authentication as it will eliminate the hassle of bringing out their credit and debit cards and remembering passwords.
Hence, tech-savvy businesses are beginning to introduce biometrics to provide a much safer, faster and reliable method to identify their customers to avoid fraud and identity theft. Biometric payment system will be more reliable than ever and consumers will adopt it because it will keep them more secure online.
Augmented reality will revolutionise digital payments
Virtual Reality (VR) involves the creation of a simulated environment from the use of computer technology. Presently, VR has moved beyond gaming where its application has expanded into retail, education, travel and even urban design. If you think eCommerce is revolutionary, try VR Commerce. It may once again transform how companies do business and how we make payments.
While one can argue that mobile apps in their current forms already enable seamless payment processes, VR payments may offer a more tangible and “real” experience, which may end up being more attractive to consumers.
Proliferation of neobanks
Neobanks are digital banks that enable customers to perform a diverse range of banking activities via their mobile phones and personal computers only. They are different from conventional banks which offer banking services through their network of physical branches.
Neobanks are getting really popular and many countries already have the necessary regulations to govern such digital banks. This would highly encourage the usage of mobile-based transactions across Asia Pacific and beyond in the near future.
All in all, the future of mobile payments is getting brighter with a relentless and continuous growth in mobile-based transactions. Hence, it would be prudent for all of us to be aware of such trends to stay relevant and competitive in business and commerce.