Top Banking and Mobile Payment Trends For 2013Posted on January 14, 2013 by Amy in Credit Card Transactions, Payment Methods
Technology has changed the way we spend and manage our money, and even more developments are expected to come into play over the next year.
Both phones and social media will be key influences on the industry, according to analysts at Javelin Strategy & Research.
The company has laid out a roadmap of changes that will take place in the financial services industry in 2013 and identified four key areas of development:
Less trust in financial institutions,
- Omni-channel banking,
- More smartphone security issues; and
- Retailers will take more control over payments.
The 10 Trends For Financial Services in 2013 report is designed to help financial institutions and others within the industry keep afloat over the next year.
Javelin predicts, for instance, that a loss of trust in our financial institutions could lead to the development of more interactive tools and support services.
The Director of Multichannel Financial Services at Javelin, Mark Schwanhausser, said the winners among financial institutions would be the ones that do the best job of developing an intimate financial snapshot of the customers, without crossing the line of being too “creepy.”
“It is difficult to rebuild trust once it erodes,’’ he added. “(Financial institutions) that put themselves in position as proactive, straight-shooting advisers will reap trust and loyalty.”
But that is just the tip of the metaphorical iceberg. While the report highlights the steps providers need to take, it also gives us a guide to what kind of financial options will become available to us in the near future.
So here we take a closer look at what the next 12 months holds for personal finance changes, particularly in regards to our credit cards.
You can already access your bank and credit card accounts via branches, phone, online banking and mobile banking, but there is often disparity between the mediums you use.
The next logical step for banks (and other credit card issuers) that want to keep up with technological developments and use, though, is to make sure each form or channel of banking connects well with others.
This development should mean better banking options for us and, in turn, easier ways to track credit card spending and balances.
As we have increased our use of smartphones and other mobile devices, the number of security issues, such as malware is also on the rise.
With two out of every three mobile devices left unprotected, Javelin said hackers would see smartphones as one of the easiest targets.
Javelin suggests financial institutions partner with security firms to offer customers better protection and develop an awareness of these risks.
But the chances are good that it will be more than the banks warning us about new forms of fraud; security software companies, tech media, smartphone providers and more will probably also run campaigns around mobile device security.
This awareness should end up giving you an advantage over the hackers targeting smartphones, tablets and any other mobile devices that you use, because you will know what to look for.
But at the very least, it should make the process of reporting issues faster and less stressful to resolve.
Retail Purchases and Swipe Fees
In 2012 the retail industry fought hard to reduce the cost of swipe fees imposed on them by banks, even arguing that they increase the cost of shopping for customers.
While the settlement is still up in the air, the prediction is that retailers will take as much control as they can get over payment options.
As well as collectively challenging the settlement, this could see an increase in different ways to make card payments – such as those from Groupon, PayPal and Square – so that swipe fees are reduced or by-passed for merchants.
Swipe fees, however, are one of the main forms of funding for credit card reward programs.
This connection means that any significant changes to the profits that banks make off traditional card processing could lead to financial losses and even significant restructuring of reward options.
Other Credit Card Predictions
While Javelin did not look at credit cards specifically, it is interesting to consider the changes that came about in 2012 and where they could lead over the next year.
One of the biggest developments was in the realm of digital and virtual wallets, with major players like Google and Visa promoting these cloud-based, mobile payment options.
Then there were the smaller, but very popular, virtual wallet options like the walla.by card, Square and Geode.
With more and more of us using smartphones and cloud services for other parts of our lives, the competition between these options (and any new ones) could lead to interesting developments.
Connections to daily deals seem likely, with the likes of Google already testing out this option, but it will also be interesting to see what kind of partnerships and promotions form as a result of new technology coming to our banking.
While a lot of things can happen in a 12 month period, from all the predictions above it seems as though almost all of the banking and credit card developments will work in our favor.