Delivering an experience fit for the future consumer
Research shows consumers expect a fuss-free, seamless experience, so how will businesses lead the way?
Over the course of history, there have been many different forms of payment systems, from exchanging salt for goods, to bartering with paper currency and coins. The way we make payments is evolving quickly, with the digital age ushering in the development of even more convenient and efficient methods to pay for goods and services.
Instant, seamless and secure experiences are now defining the payment model of the future and businesses will need to adapt.
The future consumer wants a seamless experience
Largely impacted by evolving digital technology and changing consumer demands, we have become conditioned to expect seamless and immediate payment experiences. The Where the World’s Moving Global Report reinforces this sentiment, with 78% of respondents expecting seamless and instant global payments.
The shifting landscape towards instant payment systems holds tremendous promise to improve the customer experience. The explosion of smart phone and digital wallet technologies means consumers can now check their bank accounts and balances instantaneously, track their spending, and split bills, all from the convenience of their chosen device.
From a business perspective, the expansion of payment networks has enabled more efficient use of cash flows as payments and invoices can be processed almost immediately. Additionally, businesses now have access to rich data on what consumers are purchasing and how and where they are purchasing it. Whilst data collection at scale will need to be balanced with privacy considerations, the demand for personalisation means organisations around the world delivering seamless, end-to-end customer experiences will win the battle for hearts and wallets, according to the report.
Australia has been taking steps towards adopting digital payments, through the introduction of the National Payments Platform (NPP). With a simple payment ID, households, businesses and government agencies can now make transactions easily and immediately. The demand for real-time global payments and the era of smart banking has also seen OFX recently implement the Faster Payments System (FPS) in Hong Kong. Available for personal customers, the FPS offers real-time payments from bank accounts to receiving institutions.
Creating an ecosystem of connectivity
The adoption of digital payment innovations is also dramatically shifting the way people conduct business, with the rise of e-commerce and the revolution of cross-border payments.
Through new payment technologies, businesses can now unlock previously untapped markets and engage in the global marketplace. For example, the OFX Global Currency Account offers online sellers access to multi-currency accounts and in doing so, removes once existing barriers associated with selling across borders. Innovative and seamless solutions like this are helping pave the way for domestic sellers to scale internationally and reach global audiences.
“Organisations around the world delivering seamless, end-to-end customer experiences will win the battle for hearts and wallets.”Where the World’s Moving Global Report
Similarly, APIs are transforming the way businesses function and helping create a more seamless experience. Using API technology, businesses can add more value for their customers by offering other services and products through the one interface. Think airlines adding the option to book Airbnb accommodation and Uber rides through their site, or Instagram adding the ability to play Spotify songs in their Stories feature.
Or even take cloud accounting software Xero for example. By embedding OFX’s Payments API through their own platform, Xero is enabling their users to make cross-border payments at competitive rates.
APIs are presenting a world of opportunities to the digital payments space, as increased integration between financial institutions and FinTech firms will revolutionise the efficiency and speed at which transactions are made. Additionally they have allowed businesses to be a specialist in one area, whilst at the same time given them the ability to connect to a whole ecosystem of other similar businesses. The result for the end-user is a more efficient, streamlined process.
What this means for the security of payment transactions
The need to secure transactions with the simplicity desired by the consumer will be the challenge and opportunity for businesses participating in the era of instant payments. Biometric authentications, such as fingerprint ID, two-factor authentication and voice recognition will be vital to counter these security concerns. Organisations will need to accelerate their adoption of such security measures to ensure they offer enough options for their consumers and improve on current practices, without impacting the user experience. The wave of new payment systems has fundamentally changed the way we live and conduct business across borders. With technology and rising consumer demands now leading the way towards seamless and instant payment experiences, a frictionless journey might already be within our grasp.
IMPORTANT: The contents of this blog do not constitute financial advice and are provided for general information purposes only without taking into account the investment objectives, financial situation and particular needs of any particular person. UKForex Limited (trading as “OFX”) and its affiliates make no recommendation as to the merits of any financial strategy or product referred to in the blog. OFX makes no warranty, express or implied, concerning the suitability, completeness, quality or exactness of the information and models provided in this blog.