Payments of the Future

November 5, 2015

Almost every panel on wearables and the IoT at Web Summit touched on the topic of payments, and so we made sure to hear about the subject straight from the source, Jonathan Vaux, Director of New Payment Propositions for Visa Europe.

Vaux predicts that the future of mobile payments will involve further innovation with respect to in-app payment and wearables, something he credits to near-field communication (NFC). He also anticipates we’ll see more integration in the broader IoT beyond wearables, with things like in-car payments per a partnership between Visa and Accenture that was announced at Mobile World Congress (MWC). Just imagine going to a drive-thru and having your car be the payment mechanism. Vaux imagines this will soon be a consumer reality.

As the industry of mobile payment solutions continues to blossom, there’s a battle over consumer control. Vaux shared his viewpoint, which was that the argument shouldn’t be about who owns the customer – and their respective data. The focus should be on creating a smooth payment experience for the customer. Things like safety and privacy continue to be a hot topic in the news, with pain points about password protection being top of mind for many consumers. In Vaux’s opinion, the consumer doesn’t want to know that safety is an issue, they want to know that the payment systems are constantly committed to collaborating for the most secure system possible.

To create wide-spread adoption, Vaux says that companies must work hard to make mobile payment behavior habitual. As it becomes the norm, companies can then focus on optimizing the process by minimizing devices (something that he called “invisible payments”), and evaluating means of authentication such as biometrics, non-sensitive tokenized consumer data and geo-location.

Vaux wrapped up his presentation by leaving the audience with two key thoughts that tied his talk together:

Communicating safety is critical to the growth of the industry. The more companies can communicate what they’re doing to protect data, the more comfortable consumers will be in embracing the technology.
Multi-stage authentication isn’t going anywhere. Vaux said he sees the future of authentication as a 3-stage process. The first two stages he explained were based on invisible things like biometrics, and the final stage, if and when necessary, would be a physical customer action.