Far-fetched predictions of micro-chips under the skin by 2020 to aid payment process
- Mobiles expected to be main method of payment by 2020
- Inconsistent information and slow payment processes at heart of move towards mPayments
- Banks to focus on renewing infrastructure between now and 2017
Data, published today by KPMG’s Payments Team, reveals that corporate customers are adding their voice to calls for more advanced mobile payments solutions. Many are driven by a desire to access information rapidly, allowing them to make better use of customer data and transactional records.
According to the research some respondents believe that, by 2020, point-of-sale transactions will take place using biometrics (12 percent) or micro-chips embedded under the skin (2 percent). More realistically, the majority expect mobile phones or watches to be the most likely route to payment (54 percent), with current preferences for plastic cards and cash expected to diminish (16 and 14 percent, respectively).
“In a society dominated by hyper-connectivity and a thirst for real-time information, corporate customers are demanding instantaneous transactional data, together with the ability to speed up the payment process. Banks are realising this, with some products already emerging, but the pace of change needs to increase, if customers are to be kept happy,” says Mark Hale, head of payments and transactional banking at KPMG Management Consulting.
KPMG’s research goes on to reveal that 1 in 3 corporate customers (30 percent) claim that there is no consistency in the information they receive about payments from different parts of their bank. Twenty one percent also suggest their bank does not provide useful information about payment activity. With a significant proportion of respondents arguing that banks should be a ‘valued partner’ and ‘trusted adviser’ (53 percent), it is concerning to note that some businesses are creating their own ‘payment factory’.
However, at the same time it is encouraging to see that banks’ focus for the next 5 years revolves around delivering value for customers and renewing infrastructure. 31 percent suggest new channels and customer service models will emerge and 26 percent believe a new payments infrastructure will become reality. Almost half (47 percent) claim that the emerging 4G spectrum and comfort with ‘Apps’ are critical factors underpinning the desire for these changes, especially mobile payments.
Mark Hale concludes: “There is no doubt that the future lies in mobile payments. Already 1 in 4 banks see mobile communications as the best way of reaching their customers so the logical next step is for transactions to be delivered in the same way, The key will be how to deliver these changes with a simple interface and at an affordable cost.”
Mike Petrook, KPMG Press Office
020 7311 5271 (t), 07917 384 576 (m) or email@example.com
Notes to Editors:
The research was undertaken amongst 145 senior banking executives during the 2012 International Payments Summit.
KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and operates from 22 offices across the UK with over 11,000 partners and staff. The UK firm recorded a turnover of £1.7 billion in the year ended September 2011. KPMG is a global network of professional firms providing Audit, Tax, and Advisory services. We operate in 152 countries and have 145,000 professionals working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG International provides no client services.