5G and the payments industry.

5g is really here. In the UK it has rolled out to around  200 cities. Globally there are expected to be 221 m 5g phones sold by the end of 2020 and more than double that to 489m, sold in 2021, according to Gartner. It is a significant new technology that is expected to make major impacts in gaming, IOT, autonomous vehicles and remote healthcare.

A key aspect about 5g is that it is initially, an urban technology suitable for crowded cities and towns. Over time it will extend more widely.

But what will its impact mean for the payments industry?

The key advantage of 5g is much increased speeds of download- estimates put this as up to 200 + mbps or several times as fast as 4 g.

This will enable films and sport to be viewed much more easily. It will also allow much more vivid detail to be shown on the screen.

It will also reduce latency. Latency is simply the amount of time information takes to go from one piece of kit in the network to the another. This will improve the experience of the payments process- albeit a small increase. Latency is expected to be half the current amount.

Perhaps the greatest difference will be the experience that individuals find in crowded settings. This applies to things like sports stadia at specific times e.g. half time and busy railway stations. We’ve pretty much all been at a match trying to look at the other current scores and getting frustrated. Actually quite a lot of transactions occur whilst people are traveling - so this should improve things.

Another area of improvements is in Security around transactions. Facial recognition potentially becomes much improved under 5g- so we will start seeing a lot more of this. Also the use of other Biometric signals will grow with 5g ( Iris recognition, how we hold the phone)

Also consider the use of contactless technology. This has been growing for a while and will continue with 5g.The experience of various pay by phone methods (at the point of sale) will again be improved. This will be particularly useful in hospitality settings where queuing and technology limits are frustrating. This will become much more widespread.

Another area that could see meaningful change is in Augmented Reality. This is where the power of 5g could make things really interesting. Take a complex issue like trying new clothes. Remotely. Imagine buying a new winter coat. We know that technology exists for trying new styles using virtual technology is already in place in store, but 5g could deliver a similar experience remotely? Imagine a virtual you testing different colours rapidly. It could assist in a number of other ways- length, size etc.

So 5g is real and will only grow in time. It will improve the customer experience. It is a useful enabler to the payments business with transactions being a little quicker and more secure This is good and with the wider economic benefits it will make a significant difference.