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I've been hearing about the eventuality of biometrics for 9 years. I'll give it one more year before commenting about it since I subscribe to Bill Gates' famous saying about how people underestimate the amount of change that can happen in 10 years. I'm not sure how EMV is relevant in the present context of CNP transactions but, nevertheless, in my interactions with merchants, banks and regulators in various parts of the world, it's not as though USA doesn't care about fraud. It's just that (a) only it gets friction and the other here-and-now revenue-threatening problems caused by overzealous implementation of fraud prevention measures, and (b) Even without VbV / SecureCode, there's no evidence that fraud as a percentage of CNP transaction value is any higher in the USA than other parts of the world that have implemented 2FA / Mobile OTP, etc.

Instead of USA following the ROW on convenience-versus-security, I'd place my bet on the opposite. With several Indian ecommerce companies getting rid of the extra hop involved with ePGs, a couple of them completely shifting to US-based payment processors in the recent past to circumvent friction, the trend has already commenced.

@AlexP:

TY for your comment. The rationale from the issuer's p.o.v is clear: To make online payments more fraud-proof. Question is, will the resultant friction will also make it transaction-proof (for me, it already has).

In today's world, customers are spoilt for choice: They'll simply ditch the MOP that requires 10 hoops to stay secure; cash will make a comeback (as it is, cash-on-delivery accounts for 70% for ecommerce in India); we'll start seeing genuine innovation in payments viz. COD for otherwise completely digital transactions like e-tickets at no higher transaction processing cost than the MDF/MSC applicable for card payments, as I'd highlighted in The Death Of Cash Is At Least 190 Years Away.

When it comes to how payees wish to get paid, our experience mirrors that of @EranK. That said, payees don't always have a say. In my personal blog post Why B2B Suppliers Should Accept Credit Cards, I've cited a real life example of why the payer (i.e. buyer) only wishes to pay by credit card and the seller will lose the deal if s/he doesn't accept credit card. In such cases, nonbank alternatives like SQUARE and PayPal muscle their way into the transaction. But, and this is my real point, banks are still present in the transaction. Payee accepts credit card payment, bank collects its regular interchange fees, nonbanks receive an additional fee (from the payee) for extending a merchant account to the payee who wouldn't have got one from bank. In a nutshell, even in transactions frontended by nonbanks, banks don't lose any fees, just that payee bears a higher transaction processing cost.

Given the key role played by targeted offers driven by transaction data, I'm not sure if banks can find a business case for getting into mobile wallets since it won't be practical for one bank to solicit offers from another bank for the latter's cardholders. This might explain why banks have largely left mobile wallets to third-parties, who are better placed to sign up offers from multiple banks. That said, banks can alternatively treat mobile wallets as a branding investment. From what I know about the money spent by one bank on developing its own mobile wallet, it's a mere rounding error on its marketing budget.

Having claimed that Banks Have Nothing To Fear From TELCOs, I'm happy - and relieved - to note, "This year we have three major banks from Europe and the Middle East but no Western European operators anymore".

In the past, whenever I've read that Vodafone had launched M-PESA in India, I've checked the availability date. Everytime, Vodafone India has told me that it has no immediate plans of launching any mobile wallet in India. Let me try again and see if my experience is any different this time. It's not only complex to launch a mobile payment scheme in India but, with the current regulatory requirement of linking mobile wallets to bank accounts, it really serves no useful purpose. 

In the debate between the cost of cash versus cashless payments, the only two parties whose opinions really count is payer / customer and payee / merchant. The merchants have spoken unequivocally that cash is much cheaper from them to handle than noncash alternatives.

Apart from the ultra-narrow definition of the CFO's KRA, I agree with almost all other points. This also highlights the crucial role played by the business while inputting master data into systems even if it sounds trivial at the time. No amount of technology integration or process uniformity can deliver enterprisewide visibility if, for example, purchase wants to continue to codify an item as 2-INCH-NUT, finance, as NUT-2-INCH and sales, as NUT-IS-A-NUT.

Hopefully, after this high-profile case, the "cash must go" camp will stop associating money laundering, drugs and other nefarious activities exclusively with cash. Now that law enforcement has caught on to shady alternative payment networks, I hope the day is not far when the ax falls on other providers who block merchants from withdrawing their funds under the guise of verifying the nature of the transaction but don't bother with such formalities while pulling out the money from the payer's account, slapping their fees on top and enjoying the float for months.

Customers need as much advice on how to approach social media as banks. Many of the former simply don't understand that there's got to be a difference between communicating with friends and a bank on social media. Shedding command-and-control, changing style of engagement - all these are fine. But, it's not fine for a bank to dignify a lot of gibberish and NSFW language put out by customers with response (cf. Bridging Social Media With Traditional Customer Service Channels on my company blog for examples). Not surprisingly, banks prefer to engage with customers on their own websites. I only wish they improved the UX of doing so.

@TusharC: Nice to see you on Finextra Blog! As I'd highlighted in my op-ed piece in JIBC, virtually every nonbank / mobile payment method in existence today uses banking rails in one form or the other - as a funding source, for executing the transaction or for cash in / cash out process. Carrier Billing is one rare exception, but for reasons I'd outlined in Banks Have Nothing To Fear From TELCOs, they don't seem to be headed for mainstream adoption anytime soon. Furthermore, with increasing regulatory scrutiny over Liberty Reserve et al, the outlook for alternative payment systems doesn't look so rosy any longer. If I were a bank, I'd surely keep an eye on the new kids on the blocks but spend far more time and money on improving my current electronic / mobile payment products so that they enjoy greater adoption. In short, evolution, not revolution.