In your opinion, what are the most interesting trends happening in the payments industry right now?
There are a lot of things that are happening right now in terms of allowing people to use their mobile devices or other types of devices, as a payment instrument and this goes beyond simply purchasing on an e-commerce site. The current trend demonstrates a rising use of mobile use for money transfers, peer-to-peer payments, peer-to-group payments, person to SMBs and micro-merchants where the payee wishes to remain anonymous and or when the merchant does not have a credit card processing device, and using a smartphone for unattended POS such as vending machines. Customers and providers wish to be able to connect or what we call ‘pair’ their mobile with any other device on an occasional basis for ad-hoc payments by using a unique, one-time sonic token.
I clearly see the persistence of a tradeoff balancing act between the desire for a fantastic frictionless user experience and industry security requirements. Strong authentication can reduce repudiation and friendly fraud, but at the same time it can also kill all impulsive purchases. So there is a trade-off between a smooth, easy to use experience, and keeping security and assurance as a part of the transaction. I believe that sonic data transfer solves this without compromise.
Many of the authentication schemes are moving towards easy but secure systems, all of which require strong authentication scheme. For example, biometrics as a first factor is a popular solution. However, this still leaves the need for the second authentication to verify the device being used. One technology solves this, using an ultrasonic authentication.
We were able to do this with The Nets Group in Denmark for example. What we did with Nets, was to equip their old vending machines with the ability to have mobile payments. Customers were able to approach the machine and pay at the machine without touching it, using a mobile app.
What is the best way for financial institutions to enter the payment scheme?
For banks and financial institutions, their basic systems have been around forever and are very complex, based on old technologies that in most cases have been combined with new technologies, so their overall systems are very sensitive. It can be extremely difficult to integrate new technologies. Hence, any technology that eases implementation without forcing the financial institutions to change their business policies nor their operation methods, will have an advantage, otherwise, it will just take financial institutions forever to change.
Are there any insights, trends or developments within this industry that have surprised you?
Looking back, one of the biggest changes that really took everybody by surprise, is the fact that China was able to leap over the credit card world and directly adopt mobile wallets like AliPay and such. And this was absolutely astounding to the credit card industry, as Asia just skipped right over them. This was a great unexpected phenomenon. Alipay was able to close the loop and offer customers the services of a bank, without first having to go through the traditional processes.