With the introduction of digital payments such as Apple Pay, Google Wallet, Barclays pay tag and social payment apps like Venmo and PayPal. Does the future of the plastic cards looks bleak? Who is driving the future of digital payments?
Increasingly people are using phones to make digital payments. this trend goes against the traditional use of a plastic card. Who is driving this shift towards digital only payments? Millennials of course! Lets take a look at some of the facts from a recent worldwide survey undertaken by PayPal. Let keep in mind the impact this may have on how we operate snack machines or coffee machines in the future.
34 per cent of Millennials see credit cards as “old fashioned” and a staggering 71 per cent believe traditional credit/debit cards are not secure anymore.PayPal argues, “Millennials want credit that is as digitally native as they are.”
This view of plastic card insecurity was equally true across all age groups. A large portion of respondents “agreed somewhat” indicates that people are confused and not sure what’s true. The perception of insecurity is pervasive however. Of course, many can argue the digital age is about innovation which can inevitably disrupt traditional methods with more convenient ways of doing things and that is exactly what is happening with credit cards. No one enjoys fiddling around in their wallet to find the credit card they want to use or panicking at the thought of losing their wallet and waiting days for a replacement card to arrive. It is very inconvenient and ripe for a disruptive technology to swoop in and transform the industry.
Recent examples of innovations that have highly influenced digital payments is
Apple Pay, which is growing in popularity and allows users to pay for items using their smartphone combined with Near Field Communication. This combination allows contactless payments and users can choose from visual versions of their credit cards when choosing payments. This shows that the credit card won’t necessarily die, it will just change its form from plastic to virtual.
Google wallet is similar to Apple Pay. Users can store debit cards, credit cards, loyalty cards and gift cards virtually in the platform. It also facilitates and easy and fast way to pay people efficiently online, in a similar way to the popular app Venmo. Along with efficient payments, each platform offers helpful analytics to report on spending habits and savings opportunities.
Uber cabs are an example of a large corporation that not only cuts out cash altogether but the payment experience as well. It allows the user to focus on the experience instead of dealing with payments. It also gives drivers the confidence that the client can pay for their fare. This removes any awkward, uneasy feeling about taking a taxi drive and allows all parties to enjoy the experience. Imagine if you could go to a supermarket and leave without physically having to swipe and pay? So has it worked? Well Uber is 6 years old to date with the latest reported turnover of $10 billion and all done via Digital payments!
At this point digital payments are in a stage where users need to observe and use new payment methods to keep up to date with changes. E Commerce is the main industry that needs to be considering how to integrate digital payments in the future to help improve the overall user experience with their brand. Individually our very own personal banking experiences are changing so it is vital our business goals are also aligned with the latest payment infrastructure.
We at Connect have always invested in staying up to date with our latest vending machines and you can certainly be sure we have a few tricks up our sleeves in our next offering, a game changer! Watch this space early next year.