The changing face of payments: new research

The Financial Services Club released their latest survey research last week – The Changing Face of Payments 2013.  The survey had responses from 450 financial services professionals in a total of 63 countries, with the majority from UK and mainland Europe.  The survey builds on a similar exercise last year, asking which infrastructures are most important to them, and are they fit for purpose? 

Most respondents ranked their processors as fit for purpose, with SWIFT and Visa being ranked as the most innovative.  However Europay, Stet and Eurogiro were judged to be more ‘challenged’ or ‘out of date’.  Personally I think this is a little harsh on Stet, the domestic French processor and it may reflect the survey sample.  Stet has recently won the contracts to process payments in Belgium and Estonia, and they already process an immense volume of ACH and card payments efficiently and effectively. Perhaps they need to shout more loudly about their successes.

The most important success factors for retail payment infrastructures were ‘security’ and ‘mobile’, followed closely by ‘resilience’.  The importance of mobile was significantly higher than it was last year, which is hardly surprising, but it is striking that resilience wasn’t at the absolute top of the list.

Mobile was a recurring theme in the responses to many aspects of the survey, and over half of the respondents believed that mobile payment transaction volumes will exceed internet transaction volumes within five years.  Personally I think this is conservative, particularly in the UK, but we shall see.

The report also looks at the impact of regulation on investment decisions and on technology choices.  It’s clear that the combination of regulatory changes, technology advances and changing consumer behaviour mean that we will see more, and greater, change in the payments market in the next couple of years.  In the UK this change is highly likely to be accelerated by the UK Government’s desire to dramatically change the way payments are regulated in the UK, as announced earlier this week by George Osborne (which I will discuss in a separate blog).