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10 trends that will drive the future of payments

These 10 trends are based on Accenture’s 2017 North America Consumer Payments Pulse Survey of 1,500 consumers in the United States and Canada.

1. Today's teens will change payments

Generation Z – current teenagers born in the 21st century – are the digital natives that expect immediate and personalised online and mobile experiences, shaping how they will use payments in future – and by 2020 they will make up 40 per cent of all US consumers. They are more likely than older generations to want to make instant person-to-person payments and a third of Gen Z consumers want to share their payments on social media, compared to only three per cent of Baby Boomers.

2. Customer experience is the new gold

Customer experience is becoming the prime competitive differentiator – just as Open Banking regulation (PSD2 in the EU) means that traditional banks are losing their exclusive relationships with their customers. The Accenture survey suggests that more than half of younger people – those under 35 – would be willing to share online bank account credentials with third parties.

3. Mobile gathers pace

The survey found that 23 per cent of consumers would give up their mobile banking app for a digital wallet with all their payments information in one place. And 64 per cent of consumers plan to use a mobile wallet in 2020, up from 46 per cent today.

4. Consumers want rewards

Almost half – 48 per cent – of consumers would switch their primary rewards card to get more value for their purchases, and 42 per cent would switch for a large up-front, sign-up bonus. Rewards are a strong motivation for consumers but the market is changing, with rewards likely to become more personalised and experience/lifestyle-based in future.

5. Bank collaboration gets bigger

Collaboration between banks – what Accenture calls the 'network effect' – is leading to multibank projects for innovative payment solutions, such as Zelle in the US, an API-enabled network of more than 30 partners, enabling real-time payments across thousands of banks and millions of consumers. Accenture's report says that “collaboration is bigger and bolder than ever before”.

6. Fintechs and bank fusion

Collaboration will make the payments fintech landscape unrecognisable in a decade. While traditional banks have infrastructure, industry knowledge, brand reputation and huge customer bases, fintech companies contribute expertise in disruptive technologies and the ability to innovate flexibly.

7. All in the code

Accenture explains: "Accounts are identified by a string of numbers. But with EMV, every credit card account becomes software code. Code that runs securely and can produce a different number every time. Combine this with advancing digital payments technologies, and the potential is mind boggling. Over the next few decades, this change will disrupt nearly every aspect of payments.”

8. Everyone can accept payments

The Eureka moment for solving the problem of individuals accepting card payments came in 1999 when Paypal found a way to enable individuals in effect to become a POS – a practice that is prevalent now, with applications such as PayPal, Venmo, Stripe and Square. This trend is set to continue, as more people will be able to accept card payments on their mobile devices.

9. Criminal innovation

Accenture's report states: “Criminals are making it their full-time job to out-innovate the payments industry.” It also writes that the credit card industry can expect to see $31.3 billion of losses in global card fraud in 2018 – an 18 per cent increase since 2013.

10. Time for infrastructure change

Traditional payment systems that settle transactions over several days are no longer fit for purpose in tomorrow's world of real-time, immediate payments. Calling today's technology 'monolithic', Accenture's report says: “Ripping and replacing will give payments companies newfound technical flexibility.”

Accenture's infographic, below, summarises the 10 consumer payment trends:

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