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How Banks Can Drive the Mobile Payment (R)Evolution


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In-store mobile payments usage has increased significantly. Our research shows that, when compared to last year, more than twice as many consumers now turn to mobile payments at least a few times a month. And banks, which garnered the highest level of consumer trust in our study, are sitting on prime digital real estate when it comes to ushering mobile payments into the mainstream – and remaining relevant among more agile competitors. In this infographic, we pair our recent consumer research with the strengths of key market players to decipher the four trends that stand to affect — and propel — banks through the mobile payment (r)evolution.

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How Banks Can Drive the Mobile Payment (R)Evolution

  1. 1. THE MOBILE PAYMENT Presented by (R)EVOLUTION THE GROWTH STORY Mobile payment usage continues to grow year after year, with more than half of consumers (56 percent) now using mobile payments. Banks must reimagine their business, embrace innova- tion, transform into fast-moving organizations, and respond to these changing customer behaviors. 0% Very frequently (daily) Frequently (2-3 times a week) Occasionally (a few times a month) Seldom (every few months) Rarely (a few times a year) 2015 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 2016 5% 13% 12% 27% 19% 39% 15% 14% 49% 6% Q: How often would you say you currently use your mobile phone to pay for things in physical stores? of respondents use mobile payments at least a few times a month. In 2015 In 2016 36% 80% Asia Pacific is set to lead mobile payment (r)evolution. 276 Million about half of China’s mobile internet users use mobile payments. of respondents “rarely” use mobile payments in store (among those who have used mobile payments), down from 49% in 2015. 6% THE TRENDS DRIVING THE CHANGE Emergence of mobile, cloud, artificial intelligence (AI), software as a service Shifting technologies and their applications $3 billion+ in venture capital (VC) funding drives a massive proliferation of startups Substantial funding Empowered customer, smartphone-equipped, with anytime and anywhere expectations Evolving consumer behavior 02 03 THE TRUSTED SOURCE Banks emerged as the most trusted go-to source for mobile payments in our survey. For retailers and technology companies, trust has proven to be one of the leading barriers to consumers’ acceptance and usage of their bespoke mobile payment options.  Q: Who do you trust the most to provide mobile payment services? 43% 14% 11% 10% 6% 5% 4% 3% 2% 1% 1% My bank or other established financial institutions Source: SapientNitro, 2016.* A retailer, like Walmart,Target, or Starbucks Other 01 A mobile phone carrier, like Verizon, AT&T, or Sprint Device manufacturers like Apple, Samsung, or Motorola Google No one Amazon It doesn’t matter who provides the service as long as I get what I want Credit card providers Alternate payment service providers like Paypal, Square, etc. Source: SapientNitro, 2016.* WHAT BANKS CAN DO Partner more closely with retailers and technology companies who offer direct payments. Develop unified payments, integrated reward and loyalty programs, personalized offers, and even GPS and in-venue navigation, all in a single and compelling payment experience. When designing user experiences, place the customer in the center and be more agile if they want to better engage the new generation of payment customers. 01 02 03 THE FUTURE EXPERIENCE THE FANTASY PAYMENT TEAM Consumers will be instantly rewarded in line with their preferences every time they engage in a transaction - not to mention having automatically organized records of each payment. For banks, these personalized experiences will lead to higher customer engagement, cross-sell opportunities, and retention. Automatically recognize when consumers enter the store Allow them to browse peer reviews Shop Wayfind Connect socially Manage coupons and rewardsPay for foods and services through bespoke mobile apps Determine the right payment method and currency Ensure the highest security Stay on top of what each consumer can afford FUTURE RETAIL PAYMENT EXPERIENCES WILL Banks can assess and refine their own approach to payment solutions by benchmarking against this fantasy payment team made up of the best-in-class solutions from each category. ACCOUNT NUMBER (* SapientNitro conducted the 2016 Mobile Payment Study to better understand the mobile payment behaviors of U.S. smartphone users. We conducted a survey of our U.S. based panel on February 2016, and received 493 responses.) FOUR WAYS THAT BANKS CAN PREPARE FOR THE PAYMENT (R)EVOLUTION Anticipate needs and provide contextual experiences Banks should consider taking existing personalized offers and using artificial intelligence and predictive technologies to anticipate customer needs. Banks can also leverage "down-timing" by sending reminders to customers during common travel times or while at the airport. Banks should consider moving beyond mobile-first, app-based strategies and embrace user interfaces that are voice-responsive or integrated with third-party APIs. Banks should consider using messaging platforms and voice-enabled interfaces to offer both transactions and biometric authentication. Banks should consider moving beyond commoditized payment services and invest in peer-to-peer payments, cardless ATMs, or partnerships with third-party rewards programs. Move faster and be nimbler with payment investments Join the conversation More than money 03 0401 02 Wechat Messaging Venmo Social Square POS Wallaby Wallet Samsung Pay Compatible Paypal Brand Visa Developer Open API Danske Bank Bank Starbucks Merchant Stripe E-commerce M-Pesa Inclusive Master- Card Selfie Pay Bitcoin Transparency Alipay Empire