As a global payment service provider, we couldn’t properly support our merchants, innovate or offer suitable solutions for our clients, without keeping track of on the ongoing developments within the payments market, the consumer behavior, as well as the latest technology trends. So, here is our latest post about the current payments trends discussed with the digital financial services blogger David Birch, at this year’s edition of MPE Berlin.
The payments industry is an exciting ecosystem in constant development. What we currently see is that the market is not dominated just by one big player or by a single type of technology. There are actually different communities that together make up the entire payments ecosystem. The market is so segmented due to the variety of issues and phenomena highly impacting payments, such as APIs, the “Amazon effect” and PSD2. These topics create different niche submarkets in which “consumers and producers work together” to make the most of these changes.
In the payments field, merchants bring their own contribution to building these specific, niche services. Certainly, PSPs can’t provide merchants with the proper products or services without their constant feedback, testing and involvement. Once the payment services are integrated into the API environment, merchants themselves are massively contributing to the development of these services by testing them and finding the best approach together with their PSP.
Nowadays, the concept of communities has got a different meaning; if back in the days we used to think of communities from a geographical point of view, the digitalization has broken these physical barriers. Communities are no longer made of the people next to you, the shops located nearby; they are not about the concept of “everybody knows everybody else” anymore. As David Birch pointed “in the digital world, we all belong to many communities” just “like each one of us belongs to different communities” in the physical space. Obviously, each community member within payments has different plans and expectations. As a result, merchant service providers must keep track of these stakeholder particularities and come up with value-adding services that meet the market’s demands.
PSPs top of mind services
Talking about value-adding services, the big, global, payments operators are currently focusing on data science, analytics and machine learning. These are the type of services that, as David Birch indicated “smaller merchants could never do on their own”. Interestingly enough, this ties in with what Ron Kalifa has mentioned in one of our previous video reports; nowadays, processing transactions has become a commodity, and merchant service providers must offer merchants extra services to greatly support their business growth. By integrating data science and machine learning into their systems and products PSPs go beyond just processing transactions and support their merchants with better conversion, higher authorization rates, fraud prevention and so on.
Bottom line, in the near future, as David Birch mentioned, we can expect that many of the ecommerce services will involve some kind of big data due to its great value. However, as he argues, we should not forget about the basic, but essential services; offering merchants customer recognition, the ability to identify a customer that returns to their store is still a very powerful trend within the industry and without a doubt merchant service providers strive to offer the most competitive service in this area.
Curious to hear more from thought industry leaders? Check out the MPE Berlin 2017 video report and stay tuned on our blog to keep up with ecommerce and payments related trends.