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Payment systems innovation continues: Ripple cutting costs, contactless booming, &

Payment systems are a hot-bed of innovation with Payment Service Providers, fintech developers, card companies and banks all competing to develop the new killer app/new payment system. Important recent developments have included:

  • Cutting Cost Of Cross-Border Payments: Ripple has received BitLicense in State of New York to sell and custody XRP, the digital asset native to the Ripple Consensus Ledger, for institutional investors and financial institutions in New York. This will enable Ripple to use their Consensus Ledger, XRP to improve currency liquidity and lower the capital costs of cross-border payments. The cost savings are created by instead of holding local currency in nostro accounts around the world. Banks can use the Ripple network to consolidate their liquidity for global payments into one XRP account, held on their own balance sheets. This XRP pool will enable correspondent banks to allocate less total capital to service their international payments.
  • Ripple Low Cost International Payments App: Santander is piloting a Ripple blockchain international payments app which connects to Apple Pay. Users can make payments of between £10 and £10,000 securely using Touch ID. Funds appear in the recipient's account the next working day. 
  • Apple Pay expands coverage: 1. is currently available in US, UK, Canada, Australia, China and Singapore, and coming to will launch in France, Hong Kong and Switzerland “in the next few months”; 2. ApplePay is now available on websites, though only through Safari browsers, shutting out Chrome and others possibly limiting Apple Pay’s adoption by online retailers. But not that useful YET. 
  • Contactless payments at point of sale are booming: In UK March 2016: 354,825 bank-owned terminals are available in the UK for contactless transactions, spend had increased by 249% over 2015 to £1,5bn+; new innovations include Barclaycard teaming up with high street fashion retailer Topshop on a range of NFC-enabled bracelets, phone cases and keychains. In China: According to eMarketer, the number of people in China using their phones to pay at the point of sale more than doubled last year, and by 2020, almost half of all smartphone users will be making mobile proximity payments. Contactless must be one of your options
  • Stopping checkout abandonment: BlueSnap - the provider of Powered Buy Platform which provides flexible integration, to enable merchants to improve checkout experience - thave teamed up with MasterCard’s MasterPass to solve checkout abandonment with higher payment conversions. Checkout abandonment is probably the biggest cost in e-commerce.
  • UK companies are stockpiling bitcoins and other cryptocurrencies in case of cyber attacks: According to a survey by Citrix and Censuswide, who polled 250 UK IT and security managers, one in three UK businesses is now creating a backup account for holding crypto currency in the event of a cyber attack such as ransomware hitting computers or servers. Sad
  • Costs of alternative payments needs to be carefully and cost-effectively managed: Work by PSE Consulting - see - shows that in Northern Europe:
    • there is an active consumer preference for “alternative” payments, rather than just being constrained by a lack of access to internationally branded schemes.
    • the number of payment types used in Europe is highly concentrated. There is a danger in getting lost implementing the long tail of “alternatives” which generate very little incremental customer reach.
    • accepting multiple online alternatives is very complex and doesn’t easily fit card centric operational processes.
  • Collection alternatives expand: Deutsche Bank goes live with innovative payment collection services through convenience stores in Indonesia. (Where else can convenience stores be used for your collections?)

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