Statistics have shown that, in the last decade, as online banking has become more popular, so too has online fraud. 23% of all British people have fallen victim to online fraud, yet for obvious reasons, no bank can or will admit that there is a problem. Juniper Research believe that CNP (Card Not Present) fraud will end up costing retailers around $130 billion over the next five years. These worrying statistics should make everyone sit up and take notice and realise the importance of implementing additional security features such as frictionless authentication (for example biometrics). The vast majority of consumers – as high as 94% according to a recent Forbes publication (Nov 29, 2019) – would prefer to complete transactions, such as payments, online. This provides a massive case for financial inclusion and secure authentication of identity.
It is predicted that instant messaging platforms such as WhatsApp, Telegram and Facebook will soon become the platform of choice for consumers to perform financial transactions on. In order for this to be feasible, these platforms will have to meet the consumer demands for simplicity and security. The security measures will have to meet the stringent banking standards and fall under the control of the banks. If the processes are too clunky, both retailers and consumers will go elsewhere to look for a more seamless experience.
It has become increasingly apparent that are in for a very exciting decade ahead and the banks will have to respond accordingly. Banks will have to become better partners, as they accept that they cannot do everything themselves at the speed at which the market requires. The competition for the major banks will come from non-traditional sources and nimble challenger banks, such as telephone companies, as they compete more aggressively for a share of the payments space. The payment aggregators and PSPs will also compete, as will the digital marketers who will be looking to create a great and secure payment experience for their customers.
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