Friday, September 20, 2019
Capgemini’s World Payments Report 2019, published Sept. 17, 2019, assessed the impact of open banking on banks, nonbank financial service providers and corporates. Researchers found banks are evolving their business models to stay apace with consumer preferences and regulatory requirements. As fintechs bring fast, simple, frictionless solutions to market, incumbent financial institutions are gradually migrating to interoperable models and real-time payments clearing, according to the study.
Paysafe’s Lost in Transaction: Gen Z expectations at the checkout, published Sept. 19, 2019, surveyed 6,000 British, American, Canadian, German, Austrian and Bulgarian consumers about their shopping habits and preferences. Researchers found 53 percent of 16 to 24-year-olds want multiple payment options at the POS. More than half of the respondents expressed openness to voice-enabled payments: 52 percent would use voice activation to sign up for subscription-based services such as Netflix, and 43 percent would consider using voice commands to restock smart refrigerators, the report indicated.
Sankar Krishnan, executive vice president, banking and capital markets at Capgemini, predicts voice technologies will play an expanding role in the open-banking ecosystem. “In the voice economy, I’ll talk into my machine to make a payment,” he stated. “Next-generation digital assistants have enough taxonomy to use language processing and create personalized recommendations. You’ll see more integration in the payments infrastructure as APIs extend the reach of financial institutions.”
Philip McHugh, CEO at Paysafe Group, observed that younger consumers are conversant with a broad range of alternative payment methods and tend to be comfortable with technology. “Accepting new payment types and expecting lots of flexibility and ease will be table stakes going forward,” he stated.
Paysafe researchers stressed the need to study current trends and create flexible future-proof business models. “Younger consumers don’t want to be forced to rely on card payments to make transactions; they are clued up when it comes to other options and they’re already embracing alternatives such as online cash solutions and see the upside of other alternative payments such as cryptocurrencies,” they wrote. “Satisfying this demand for choice as the payments ecosystem continues to diversify and consumer preference dissipates away from a reliance on card payments will be critical for all online businesses.”
Capgemini researchers found regulators are pushing banks toward open, data-led and cloud-based approaches, but noted many financial institutions see open APIs more as a regulatory mandate than a growth opportunity.
“Regulators across the world are working on frameworks to enable greater collaboration and to support FinTechs in their region,” they wrote. “In North America, the Federal Reserve Bank of New York set up a FinTech advisory group in April 2019 that offers views and perspectives on emerging FinTech issues, and the application and market impact of new technologies.”
Krishnan pointed out that banking and fintech partnerships are sparking innovation and new marketplace models. “As new players enter the marketplace, consumers have more choices and better deals, which makes collaboration a win-win for everybody,” he said.
A full copy of the Capgemini report is available at worldpaymentsreport.com/
A full copy of the Paysafe report can be found at www.paysafe.com/lost-in-transaction-gen-z-expectations-at-the-checkout/ 
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