2 Ocak 2015 Cuma

New Playmakers Of Payment and The Shifting Definition Of Money

For most companies, innovations made with regard to differentiation from the category, have become the payment systems they developed.

Apple Pay came with a wallet-without-the-wallet claim and its iPad, iPhone, and Apple Watch integration.

Many brands have accepted Bitcoin as real currency. Banks are constructing their alternative systems. In brief, payment systems have evolved in order to meet the various needs of the new consumer called the “millennial”.

Millennials are less insistent on protecting the paradigm and therefore, open to new alternatives on every matter.

This best serves start-ups that are just entering the market. With the newly forming consumer concept, for the first time in history, payment systems are able to offer opportunities that are so much differentiated.

Millennials who are between the ages 18-34 and utilize alternative payment systems, mostly use the mobile apps of brands. This could very well be a new payment app by Starbucks or banks’ own payment systems.

One-touch payment and virtual money are becoming increasingly popular.

The definition of cash is changing.

Physical money is being used less and less.

In a world where there is less of physical money, what the “new money” is going to be is totally up to the new generation who will be using it.

At the end of the day, cash, credit cards, virtual money, payment systems... are all concepts created by man.

Ages ago it was barters and now mobile payment is valuable.

In this age dominated by technology, systems, like the Cloud, that can integrate every touch point (web site, bank, etc. ) will be one step ahead.

It’s not like these payment systems do not have barriers. Security and the procedures are still the biggest reservations for consumers. That is why for now virtual cards which are backed by the power of a bank are popular rather than just any payment experience that is simpler or faster.

And if we take a look at the trends...

We will encounter the term “seamless” technology often and uninterruptedness is going to become a must-have for payment systems.

Wearable technology is not yet widespread in Turkey, however, various applications across the globe are starting to engage our agenda as well. Google Glass is a pioneer in this area. Payment can be made with just a nod.

The real surprise will come via biometric payment methods. Samsung Galaxy makes payment possible with the fingerprint scanner with the PayPal app.

More futuristic approaches are around the corner: Payment via iris scanning, voice-signature, face and vein maps will become the norm in the future.

So what are the different forms of money that are currently being used?

Even though local, brand-based, and virtual currencies are not widely used, examples are increasing by the number.

Economic crisis and the increasing income disparity make way for local currencies: Some examples are the Brazilian Capivari and the Colorado COJack.

When we take a look at virtual currencies, the dominance of Bitcoin is increasing. Even though approached with suspicion by some, there are over 250 Bitcoin ATM’s around the world. The number of brands that accept Bitcoin is increasing fast: Dish Network, Dell, United Way, Expedia, Overstock.com, The Sacramento Kings...

According to Viacom’s The Millennial Disruption Index report, 68% of millennials think that our access to money will be completely different in five years; 70% think that our payment method will be completely different from today’s; and 33% think we will not even be needing a bank.

Millennials predict that the change will emanate from players from outside the industry and 73% say that they will prefer the payment systems launched by brands such as Google, Amazon, Apple, PayPal, or Square rather than their own bank.

So how is the situation in Turkey? Who are the players in the market?

Many players like Express by the Interbank Card Center, 3pay, iPara, ininal, iyzico, Paybyme, PayPal, and PayU are competing in the market.

It is imperative that these players overcome the real barrier of the category: Security. Therefore, whoever succeeds in adding a new product feature or experience on top of security, speed, and practicality – will succeed in differentiation. This is worth fighting for because the potential in Turkey is immense: According to the 2014 data there are over 57 million credit cards and 103 million bank cards. When we look at the gap between the number of cards that are owned and the number of those that are used for online shopping, we see that there is much progress to be made in e-commerce.


Mobile operators are replacing the traditional roles of banks and financial services. The reduction of costs and the simplicity in transactions make operators more attractive thus causing the expectation that mobile payment transactions will total 7 billion in 2015.

Messaging systems:
Technology and messaging systems have positioned themselves as mediators: Payment is possible through Google Wallet, Gmail, or the KakaoPay app of the free voice chat and messaging service KakaoTalk.

Retailer have long been in the world of payment systems. However, lately they are more keen on in-store money transfers with personal accounts and to offering discounts during the transfer. Walmart allows sending or depositing money inside the store with credit cards or bank cards and what is really intriguing is that these transactions can also be made via club cards.

Payment systems are evolving with enormous speed. Some of the discoverer brands of the category are Bitcoin bank Circle, digital wallet or card producer Plastc, and the Ripple network which provides global money transfer that can be instantly converted to real currency from virtual currency.

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