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INSIDE ADVANCED PAYMENTS
Order the full PCM/EDC 2011 Advanced Payment Report
The full 40 page PCM/EDC 2011 Advanced Payment Report - now in its fifth year - is available as a PDF or hard copy.
All enquiries for the Report please contact: Kaye Skinner | +44 (0)1263 711800 | kaye@paymentscm.com
Advanced payments overview
Over the last decade, a quiet but noticeable transformation has been taking place in the world of payments. The nature and extent of this transformation is not uniform across all geographies but for the first time, all markets – rich or poor, small or large, developed or developing – have the opportunity to participate in this transformation through innovative use of technology, fresh ideas and pragmatic yet creative business models.
Markets with well developed banking infrastructures and high volumes of electronic payments are incorporating advances that make use of available payment infrastructure rather than starting things from scratch. The overriding objectives are to provide greater convenience and utility to end users, minimise transactions costs, and at the same time efficiently mitigate and manage payment risks. Markets with poor or fragmented access to banking services or those with less robust payment infrastructures are creating entirely new methods using the wide reach and availability of mobile telephony.
The last two decades have seen considerable upheaval in the field of electronic payments. The rise of the internet, the unprecedented success of the mobile phone in terms of consumer penetration, and the gradual and growing overlap between online and mobile communications have created entirely new and exciting possibilities for service providers. Sensing these opportunities, a plethora of start-ups with highly innovative propositions built around some unusual and insightful thinking have entered the payment industry. Some will succeed. Most are likely to end in disappointment.
The story of success in the field of payments lies in understanding that technology, while critically important, is not the only ingredient in the payment mix. The value proposition must itself tap pools of “latent” or hidden demand, utilise highly intuitive user interfaces and offer clear value for money to both consumers and merchants. This may sound somewhat oversimplified but a quick review of the many technically brilliant internet payment systems that came about in the first flurry of the internet, only to disappear sometime later, illustrates the fact that the road to failure is paved with good technologies.
Alex Rolfe, Editor-in-chief
What are advanced payments?
There is no standard definition of advanced payments. For the purposes of this supplement, we have included three types of payment categories: Online, contactless, and mobile payments.
This categorisation is made in the context of current debates, customer perceptions and discussions with payment industry professionals. There are other areas that could be reviewed as advanced payments but have not been included, primarily to manage the scope of this supplement.
A stakeholder survey was undertaken online jointly by Edgar, Dunn & Company (EDC) and Payments Card & Mobile magazine (PCM) over November and December 2010. The respondents included representatives from banks, central banks, mobile network operators (MNO’s), technology providers, consultants, retailers and payment entrepreneurs. It is important to note that this is not a consumer survey.
Respondents represented the payments industry directly or were in some way involved in providing or facilitating electronic payments.
A total of 655 responses were received. 51% of the respondents were executives or senior managers in their organisations and 43% described themselves as decision makers or decision influencers. The survey helps us to understand the voice and direction of the payments industry.
Payment Card Yearbooks - European Payment Cards Yearbook 2011-12, containing 33 individual country profiles and Russia, Georgia and CIS Payment Cards Yearbook 2011-12, containing 10 individual country profiles.
