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December 2015 | Blog


The future of payment tools lies in messaging apps

The advent of the digital era has revolutionized the way of doing so many things, and now it has its hands on the way we do payments. At The Future of Nordic Banking conference, companies such as Spar Nord, BBVA Compass and Kofax shared examples of what this could look like for consumers.

A lot has been said about how the payment infrastructure would change in the years ahead. We hear, read and talk about moving to a cashless world but in reality such a shift is still not taking place, apart from countries like Sweden who go ahead in a cashless economy. How come?

Seamless payments

The answer resides in consumer’s behavior. People seem to have a strong relationship with the current way of doing payments, namely cash, checks and credit or debit cards. In addition, the majority of consumers don’t recognize the value in moving to another payment method.  Launching an app or retrieving a QR code is no more convenient than taking out cash from your pocket or paying with your card. And the abundance in mobile payment tools, like Apple Pay, Samsung Pay, GoPayment, PayPal Here, PayWave, etc., which in their core are another banking solution, is contributing to confusion among consumers. Recent developments like mixing payments with fashion seems logical, like the Kickstarter payment ring Kerv, but in the end, how can we really make payments become a non-intrusive experience?

In order to displace cash and payment cards, mobile payments must provide more value to consumers that they would recognize and desire.

If the future of payments is truly mobile, it is important to take a deeper look into the way people interact with their mobile devices, what are they searching for through this interaction and what is it that can be done differently to improve and enrich their overall experience.

It is estimated that by 2017 almost 7 out of 10 people in the world will own a mobile device. Messaging apps and social platforms are where consumers spend most of their time on their mobile devices. Take WhatsApp for instance. With more than 800 million active users, the app facilitates the traffic flow of around 30 billion text and 200 million voice messages on a daily basis. As texting is more popular then face-to-face communication, messaging apps become quite convenient places that can be leveraged to bring consumers value that goes beyond a simple message exchange with friends and family.

This perspective might sound a bit unorthodox and quite disruptive, but actually a model of integrating more than one functionality with a messaging app is already in practice. The Chinese-developed all-in-one-app, WeChat, is providing solutions to various consumer needs – ranging from scheduling a doctor appointment, booking flights, ordering food, hailing a taxi, etc., and even to payments.

The model of WeChat still doesn’t exist in countries other than China. Still, in the context of bringing more relevant and convenient ways for consumers to actively adopt a mobile payment culture, it is interesting to consider whether the future of payments lies in messaging apps.

It definitely looks like a highly plausible scenario. For one, integrating the mobile payment process within a texting app has the potential to make payments a more seamless experience than mobile banking apps . As an example, the WeChat Wallet, allows users to make instant, frictionless transactions to carefully curated and preselected service providers. Think about taking a picture of your dish, sending it to your friends, tagging the restaurant where you are dining, and without needing to switch apps or look for your wallet or credit card, pay for your meal with one tap on the screen.
Such integrated features bring more convenience within the payment process and have the potential to alter consumers’ payment behavior. We expect major messaging apps like Facebook’s Messenger, which recently allowed businesses to privately communicate with customers through the app, to follow the steps of WeChat and harness the power of all-in-one apps.  


To learn more about Kofax Mobile Bill Pay™ and other industry-leading technology solutions for banking and financial services, visit www.spigraph.com/solutions .