We got used to pay for things with our phones, how long before we stop using any form of physical payments and what’s next?
Questions about the future of mobile payments
I haven’t been carrying cash (on purpose) for almost a decade now, sometimes only keeping a small amount in my wallet for those more and more unusual moments where card payments are not an option, or what is the same, in case of emergency.
Three years ago a I received a contactless enabled debit card, it was interesting, new and convenient, to the point that after a couple of weeks I even stopped pulling the card out of the wallet. I literally, just tap the wallet into the receiver and voilà!
Credit cards also followed the trend, providing them with this technology. meaning all my cardsCurrently all my cards
With contactless technologies, the pin number is not required, and transactions are even faster, going from few seconds to just one, and although the amount you can pay this way is capped to only £30 per transaction, which can be perceived as a limitation at the beginning, the reality is that 99% of my daily purchases perfectly match this criteria.
This leaves (for me) the need to type that ‘old-school’ security pin for very specific use cases:
- A store that doesn’t have (yet) a contactless card-reader
- Groceries shopping
- Dinners (special occasions)
- Pricier goods that for some reason I couldn’t get online (clothing, footwear, furniture, etc)
Recently I upgraded my phone to an iPhone 7 and with it comes ‘Apple Pay’, a feature built-in on the phone that allows me to pay with it. I immediately stop using my card(s), just as I stopped pulling it out of the wallet because of contactless, I stopped reaching my wallet because of my phone; except for the exact same reasons I just numbered above. The same capping limits (£30) apply as this are stablished by the bank.
The first natural answer tends to be biometrics.
Probably you have seen that scene from “Back to The Future II” where they use fingerprints to pay for a taxi. The iPhone (and other Smart Phones) already does this, taking advantage of its built in fingerprint-reader for both, identification and authorisation, however, still relying on the phone to handle the transaction.
So, what is the next step into the payment’s evolution that will remove the Smart Phone out of the equation?
As there are certain streams that haven been successfully digitised in its totality (at least from the user’s side of things), like airplane travelling and movie theatres, where the users can buy tickets online or in a app and then, travel or watch a movie just presenting the virtual ticket provided to them; while on the other hand still some other that still relaying solely on cash, like public transport in many cities, just to give one an example, I started to think about this gap, how and when will start to reduce and what will come next.
Based on this, current technology and market trends, and even sci-fi, I started to wonder and to ask myself few questions, regarding the future of payments and how we are going be dealing with them after we reach the point where cash and cards cease to exist; when we only rely on phones and other smart devices to handle every single transaction, and it would be the next(s) logical step in the evolution of payments technology and some of the key stakeholders, users, banks and commerce.
Bellow you will find a collection of questions, thoughts and ideas, aiming to start the conversation, get opinions and views as a way to find the interceptions between those key elements within a holistic approach.
Here we go:
Can the Smart Phone replace cards entirely? After all, Apple Pay is only hosting a virtualised copy of your credit or debit card, this card is issued by the main companies, Visa, MasterCard, AmEx.
Is there a possibility for banks to cut that link and start offering new payment products solely based on Smart Phones or similar emerging Smart Devices (i.e. Smart Watches)?
If there’s no need for a physical card, what’s the point of having one in the first place?
There’s a lot going on in the world of biometrics, to the point that we are now talking not only about finger prints, face and eye recognition, but the entire human body as the ultimate security and identification gateway.
Some questions I got in place (in no specific order)
- For how long the Smart Phone will remain the hub of our digital life/activities before other devices (wearables) become more relevant or take it’s place?
- Are biometrics beyond fingerprint the actual next “big-thing” when it comes to payments?
- When it comes to biometrics becoming the security and privacy standard, what are (some of) the possible, social and behavioural implications?
The Store of The Future
- As several technologies like machine vision, AI, and sensors are currently been merged to create new retail experience (Amazon Go), where payment is automated and linked straight to an amazon account, can this be considered as a blueprint for the future thinking on the topic or is the most logical next step?
- Finally, does the idea of sensors implanted under our skin still relevant or we moved on from that type of hyper-futuristic visions?
What do you think?
As mentioned above, these are just a collection of thought and ideas, presented in a very simplistic manner, as I think each one of them can open for a broader and deeper discussion on their own.
What’s your view of the future?