The Present State of Future Commerce

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The Present State of Future Commerce

“By 2030, 2 billion people who don’t have a bank account today will be storing money and making payment with their phones.” Bill and Melinda Gates, 2015 Gates Annual Letter

The population is increasingly dependent on mobile phones at any time, and wherever they are, penetration of mobile phone continues to grow, and greatest innovations like M-Pesa in Kenya or commerce via WeChat are all signs of democratisation of banking through mobile phones. Therefore it is not surprising how Mobile Banking as part of ‘Money and Payments’ in the Fintech ecosystem addresses key pain points in the traditional financial system and as a result is one of the greatest enabler changing how consumers exchange value.

Mobile Banking

  • For consumers, the convenience of self-service financial transactions when and where required and with lower if no risk of fraud.
  • For financial services offers a more cost-efficient platform to deliver services such as digital wallets while meeting consumer expectations of real-time transactions as well as better risk management.
  • For businesses offers alternative channels for a transaction at lower fees with lower card fraud and greater customer insights for better experiences online and in-store.

Although the outstanding question is how payment networks will integrate into a financial ecosystem no need for intermediaries, benefits do not come without challenges.

  • Digital Identity. Developers will have to build trust with consumers by protecting their privacy and security.
  • Interoperability. There is a need for further integration of players and legacy systems from traditional financial services.
  • Regulatory Compliance and Reporting. Regulators will have to accept facilitating standardisation, reporting and integration of settlements.

Also, Mobile Banking has further future implications, including:

  • Accelerated Efficiencies. The 5G launch can accelerate the integration of blockchain and Internet of Things with Mobile Banking.
  • Wealth Management. As the population gets greater control of their finances, they will also be empowered to grow wealth.
  • Social Commerce. As customers spend most of their ‘mobile’ time on social apps, it will continue to be critical facilitating transactions through their preferred apps.

Mobile Banking is providing greater access to financial services however to achieve long-term sustainable growth, beyond solving pain points with technology ensuring ongoing engagement and retention will require improvement of end-to-end consumer experiences.

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