View
786
Download
2
Category
Preview:
Citation preview
Payment Industry Trends for 2016
2015 was a historical year within the payments industry that held numerous events, which transformed the future of payments.
Between the EMV liability shiD, data breach protecEon, mobile payments, and the growth of mobile wallets, there were many significant changes that took place.
The payments industry is evolving rapidly and will certainly conEnue to do so throughout 2016 as well. As 2016 transpires, here are some of the top trends predicted to make an impact this year:
ConEnuaEon of EMV ImplementaEon
October 1st marked the start of the EMV liability shiD in the United States and altered the regulaEons in regards to card-‐present credit card fraud. With EMV now in full swing, this form of technology will be a great soluEon to shield both the merchant and consumer against possible counterfeit fraudulent transacEons.
EMV integraEon will take Eme, and most merchants sEll have yet to upgrade their terminals to EMV-‐capable products despite the mandated liability shiD. A study done by The Strawhecker Group found that only 27 percent of merchants within the U.S. were EMV-‐ready as of October 1st.
The main barriers that prevented merchants from becoming EMV compliant in Eme for the liability shiD were due to price and lack of Eme to research EMV and the compaEble soluEons. Likewise, although merchants are now fully responsible for any incidents of counterfeit fraud, many are sEll not concerned about upgrading their terminals right away.
Several merchants may not upgrade their terminals unEl it comes closer to the Eme when they need to renew or purchase new terminals. At this Eme, merchants may feel it more worthwhile to go ahead and invest in an EMV terminal so their business stays up-‐to-‐date with modern security and technology. 2016 will be a prime year where many merchants will make the switch to EMV technology as it becomes more widespread and prevalent.
Increase of Mobile Wallets
With the rise of mobile payment acceptance, consumers are now beginning to uElize their smartphones to make purchases. Mobile wallets are one alternaEve payment opEon that has become increasingly popular amongst consumers.
A study done by eMarketer found that mobile payment transacEons are forecasted to grow 210% during 2016.
In 2014, Apple introduced Apple Pay as the first mainstream mobile wallet that provided a safe and fast alternaEve for payments. By the end of 2015, all of the major smartphone manufacturers had developed a mobile wallet – including Android Pay and Samsung Pay in addiEon to Apple Pay.
In turn, with technology advancing to benefit the convenience of the consumer, most customers are now making their purchases digitally. As a result, checks, cash, and even credit card usage could slowly decline over the years and smartphones could become the prime way consumers pay.
Growth of NFC
As mobile wallets have expanded recently, so has the need for Near-‐Field CommunicaEon (NFC). NFC is a method of contactless communicaEon and data exchange between electronic devices, like smartphones, to other devices like credit card terminals.
NFC is not only a valuable soluEon for consumers, but for businesses as well, and has already begun emerging at in-‐store counters, vending machines, and EckeEng booths. When making a payment, consumers will hold their smartphone over an in-‐person contactless terminal to make a payment and NFC will communicate the data exchange from the smartphone to the terminal.
NFC’s vast list of where and when it can be used is highly appealing and is addiEonally being coupled with EMV terminals, making it even more accessible. NFC is unquesEonably evolving the way consumers acEvate and pay for transacEons and 2016 will be a big year for NFC popularity.
Emergence of Blockchain Technology
Blockchain technology is predicted to break out in the payment industry during 2016. Blockchain is a type of database on which bitcoin is based off, where every bitcoin transacEon is documented.
It is comprised of a vast series of data blocks, where one or mulEple transacEons are combined, encrypted, and stored in a secure way. With blockchain, transacEons are processed quicker and are cost-‐effecEve.
It is safe to say that 2016 is foreseen to be an evenaul year, as new trends emerge and recent trends conEnue to grow. EMV will conEnue to be implemented within businesses and many merchants will begin to upgrade their soluEons to become EMV capable. Mobile wallets will addiEonally expand and become more prominent within digital payments and the need for NFC technology will also become more prevalent. Blockchain technology, a newer trend, is expected to make an impact during the New Year as well.
Here’s to 2016 and the future of payments!
Contact First American Payment Systems to integrate payment processing today.
Recommended