Almost three in four (71%) of European retailers and financial institutions plan to increase spending on payments technology in the next 18 to 24 months in the face of increasing competitive pressure and a feeling of being ‘under siege’, reports ACI Worldwide.
The electronic payments specialist and market researcher Ovum are releasing a five-part Global Payments Insight study, surveying more than 1,600 executives from leading banks, retailers and billing organisations across the Americas, Asia-Pacific and Europe, the Middle East and Africa (EMEA) about their experiences, perceptions and expectations of payments and how payments are shaping their behaviours today.
The study also finds that the theft of customer payment details is a major concern for 70% of European retailers, while the growth of e-commerce has seen card-not-present (CNP) fraud become the most pressing issue for 59% of retailers.
Other findings of the survey include:
• Competition drives spending: The majority of European executives stated that new competitive pressures and the burgeoning threat of financial technology (fintech) are driving investments in their own payment systems.
• Immediate payments offer new opportunities: Fifty-seven percent of European executives believe that consumers will benefit directly from immediate payments, while 59% of transaction banking executives also believe that businesses will benefit directly from improved liquidity management, lower risks and faster payments.
• Payment initiators want to work directly with payment operators: A strong continuing trend from 2015 is that payment initiators (retailers and billers) want to work directly with payment operators (banks) to cut out intermediaries in the payment value chain and simplify the payments ecosystem.
Banks are seen as the primary provider of payment services by European retailers, with 87% saying they want to work directly with banks. Other payment provider categories are increasingly gaining traction, most notably online payment providers, with 74% of European retailers willing to work with them in future.
“The payments industry is undergoing radical change that will have far-reaching consequences for banks, billers and merchants, as well as for the consumers and business customers to which they provide services,” said David Bannister, principal analyst, financial services technology, Ovum.
“How all of the players in the industry adjust to these changes and interact with each other will be a crucial factor in their future success.”
“For all of these organisations, the key takeaway is that competitive pressures are driving up spending in the marketplace,” added Paul Thomalla, senior vice president, ACI Worldwide. “Spending small, incremental amounts will only lead to an erosion of market share.
“The payment initiators of the world want to work directly with payment operators. By doing so, they will be able to lower payment costs, reduce complexity and increase investments to stave off the threat of new competitors.”
A free copy of the Global Payments Insight Study is available from http://www.aciworldwide.com/paymentsinsight.
The top five sectors Asian fintech investors are interested in are data analytics, blockchain, lending, payments and regtech, according to Gary Hwa, EY regional managing partner.
On the third day of the Singapore Fintech Festival conference, there was a focus on specific applications of fintech innovation. One was trade finance, which is clearly is ripe for a revolution.
Kicking off the first day of the Singapore Fintech Festival, issues with cryptocurrencies were addressed by MIT media labs director, Joi Ito, and panels of technology leaders discussed how they’re using data analytics.
The EU and US’ shift in accounting standards may bring balance sheet losses and increase credit risk, according to James Elder, director of risk services at Standard & Poor’s (S&P) Global.